As filed with the Securities and Exchange Commission on April 21, 1999
Securities Act Registration No. 333-_____
SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549
FORM N-14
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
Pre-Effective Amendment No. ____
Post-Effective Amendment No. ___
GREAT PLAINS FUNDS(Exact Name of Registration as Specified in Charter)
5800 Corporate Drive, Pittsburgh, Pennsylvania 15237-7010
(Address of Principal Executive Offices)
Registrant's Telephone Number, Including Area Code: (412) 288-1900
Copies to:
James Stuart III Cameron S. Avery, Esquire
Vice President Bell, Boyd & Lloyd
Great Plains Funds 70 West Madison Street, Suite 3300
610 NBC Center Chicago, Illinois 60602
1248 "O" Street
Lincoln, Nebraska 68508
Gail Cagney, Esquire Federated Investors Tower 1001 Liberty Avenue
Pittsburgh, Pennsylvania 15222-3779
(Name and Address of Agents for Service)
With an additional copy to:
Donald F. Burt
Cline, Williams, Wright, Johnson & Oldfather
1900 U.S. Bank Building
233 South 13th Street
Lincoln, Nebraska 68508
It is proposed that this Registration Statement shall become effective on May
21, 1999 pursuant to Rule 488 under the Securities Act of 1933, or on such
earlier date as the Commission shall declare this Registration Statement
effective pursuant to that Rule, and the approximate date of the proposed public
offering will be as soon as practicable after this Registration Statement
becomes effective.
<PAGE>
May ___, 1999
Dear Shareholder:
The Directors of your Lancaster Fund endorse a proposal for the reorganization
of your Lancaster Fund into a similar portfolio of Great Plains Funds. If the
proposal passes, you will become a shareholder of Great Plains. Great Plains
will issue shares equal in value to the Lancaster Fund shares you own. You will
not pay a sales charge. You should not have adverse federal income tax
consequences.
I ask you to vote in favor of this important proposal affecting your investment
in one or more of the Lancaster Funds. You are welcome to join us at the
Lancaster Fund Special Shareholder Meeting, but most shareholders vote by
filling out and returning the enclosed proxy card.
The Directors of your Lancaster Fund ask you to approve the reorganization. They
believe the reorganization will benefit you by making it easier for the combined
funds to attract and retain investors. The Directors reviewed several factors,
including the investment objectives, strategies and past performance of the
Great Plains Funds and the capabilities of Great Plains' adviser, administrator
and distributor. If the Great Plains distributor successfully markets Great
Plains Funds' shares, Great Plains Funds' assets should increase and Great
Plains Funds' per share expenses could decrease. We cannot guarantee these
results, of course.
The enclosed combined Proxy Statement/Prospectus contains detailed information
about the proposed reorganization and the reasons for it. You can vote your
shares using the enclosed proxy card. It tells us how to vote on your behalf. If
you complete and sign the proxy, we'll vote it exactly as you tell us. If you
simply sign the proxy card, we'll vote it according to the Directors'
recommendation. Please carefully review the Proxy Statement/Prospectus, fill out
your proxy card, and return it to us. A self-addressed, postage-paid envelope is
enclosed for your convenience. It is important that you vote and that we receive
your proxy no later than June ___, 1999.
NOTE: If you hold shares in more than one Lancaster Fund or in more than one
account we may send you multiple proxy packages. You must return ALL proxy cards
you receive in order to vote all of your shares. We have provided postage-paid
return envelopes for each. If you have any questions, please call SMITH HAYES
Financial Services Corporation at (402) 476-3000 or 1-800-279-7437.
Sincerely,
Thomas C. Smith, President
Lancaster Funds,
portfolios of SMITH HAYES Trust, Inc.
<PAGE>
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
TO BE HELD ON JUNE ___, 1999
TO OUR SHAREHOLDERS:
You are cordially invited to attend the Special Meeting of Shareholders of
Lancaster Capital Builder Fund, Lancaster Convertible Fund, Lancaster Crestone
Small Cap Fund and Lancaster Government Quality Bond Fund (each a "Lancaster
Fund" and, collectively, the "Lancaster Funds"). The Meeting will be held at 200
Centre Terrace, 1225 "L" Street, Lincoln, Nebraska 68508, on June ___, 1999, at
10:00 a.m. The purposes of the Meeting are:
1. To consider and vote on an Agreement and Plan of Reorganization providing
for
o the transfer of all the assets of each Lancaster Fund in exchange for
shares of equal value of a corresponding series of Great Plains Funds
o the assumption by the corresponding series of Great Plains Funds of
the stated liabilities of each corresponding Lancaster Fund
o the distribution of shares of the corresponding Great Plains Fund to
the shareholders of each Lancaster Fund in complete liquidation of
that Lancaster Fund
2. To act upon any other matters that may properly come before the Meeting or
any adjournment thereof.
The Board of Directors has fixed the close of business on May 1, 1999, as the
record date for determination of shareholders entitled to notice of, and to vote
at, the Special Shareholders Meeting. A list of shareholders will be maintained
at the offices of SMITH HAYES Financial Services Corporation, 1225 "L" Street,
Lincoln, Nebraska 68508, during the ten day period preceding the Special
Shareholders Meeting. Please read the Proxy Statement/Prospectus carefully
before telling us, through your proxy card, how you wish your shares to be
voted. The Board of Directors of Lancaster Funds unanimously recommends a vote
in favor of the proposal.
WE URGE YOU TO SIGN AND DATE THE ENCLOSED PROXY CARD AND PROMPTLY RETURN IT IN
THE ENVELOPE PROVIDED. No postage is required. Prompt return of your proxy card
will be appreciated. Your vote is important no matter how many shares you own.
Lincoln, Nebraska BY ORDER OF THE BOARD OF DIRECTORS
May ___, 1999
Colleen Avery, Secretary
<PAGE>
PROXY STATEMENT/PROSPECTUS
RELATING TO THE ACQUISITION OF
CERTAIN PORTFOLIOS OF
LANCASTER FUNDS
200 CENTRE TERRACE, 1225 "L" STREET
LINCOLN, NEBRASKA 68508
TELEPHONE 1-800-279-7437
BY AND IN EXCHANGE FOR SHARES OF
CERTAIN PORTFOLIOS OF
GREAT PLAINS FUNDS
FEDERATED INVESTORS TOWER
PITTSBURGH, PENNSYLVANIA 15222-3779
TELEPHONE 1-800-568-8257
The Board of Directors of Lancaster Funds ("Lancaster") approved a plan to
reorganize four Lancaster portfolios (each a "Lancaster Fund" and, collectively,
the "Lancaster Funds"). Each Lancaster Fund will be combined with a
corresponding portfolio of Great Plains Funds ("Great Plains") if the plan is
completed. Lancaster Fund shareholder approval is needed to proceed with that
transaction (called the "Reorganization"). A shareholder meeting (the "Special
Meeting") will be held on June _____, 1999. If you owned shares of a Lancaster
Fund on May 1, 1999, you are entitled to vote at the Special Meeting. We are
sending you this Proxy Statement/Prospectus, Notice of Special Meeting and form
of Proxy on or about May ___, 1999. You should use them in deciding whether to
approve the Reorganization at the Special Meeting.
This document describes the proposed Reorganization in which:
o All of the assets of each Lancaster Fund will be acquired by a
portfolio of Great Plains (each a "GP Fund" and, collectively, the "GP
Funds") in exchange for shares of equal value of that GP Fund and
assumption of the stated liabilities of the Lancaster Fund
o Those GP Fund shares will be distributed to shareholders of the
corresponding Lancaster Fund
o The Lancaster Funds will be terminated
As a result, you will hold shares of a GP Fund equal in value to the Lancaster
Fund shares you held just before completion of the Reorganization. Lawyers for
the Lancaster Funds have issued a tax opinion stating that the Reorganization
will not cause you to recognize a gain or loss for federal income tax purposes.
1
<PAGE>
Each GP Fund's investment objectives, policies and restrictions are similar to
those of the corresponding Lancaster Fund. The risks of investing are also
similar. We have compared the investment objectives and policies of each
Lancaster Fund and each corresponding GP Fund below under "Proposal: Agreement
and Plan of Reorganization--Investment Objectives, Policies and Restrictions."
Each Lancaster Fund is a portfolio of SMITH HAYES Trust, Inc., a Minnesota
corporation which does business under the name Lancaster Funds. Each GP Fund is
a portfolio of Great Plains, a Massachusetts business trust. Lancaster and Great
Plains each is a registered open-end management investment company. First
Commerce Investors, Inc. is the investment adviser for Great Plains. CONLEY
SMITH Investment Advisers, Inc. is the investment adviser for Lancaster.
This Proxy Statement/Prospectus gives you the basic information you need to vote
on the proposed Reorganization. You should read it and keep it for future
reference. Much of the information is required under rules of the Securities and
Exchange Commission ("SEC") and some of it is technical in nature. If there is
anything you do not understand, or if you have other questions, please contact
Lancaster at our toll-free number, 1-800-279-7437. You should return your proxy
and any correspondence to Lancaster Funds, 200 Centre Terrace, 1225 "L" Street,
Lincoln, Nebraska 68508. The following documents are on file with the SEC and
are deemed to be legally part of this document:
o a Statement of Additional Information also dated ____________, 1999
and relating to this Proxy Statement/Prospectus
o the Prospectus and Statement of Additional Information of Great Plains
dated October 31, 1998
o the Annual Report of Great Plains dated August 31, 1998
o the Semi-Annual Report of Great Plains dated February 28, 1999
o the Prospectus and Statement of Additional Information of Lancaster,
dated September 29, 1998
o the Annual Financial Statement of Lancaster dated June 30, 1998
o the Semi-Annual Financial Statement of Lancaster Fund dated December
31, 1998
Copies of these documents are available upon request and without charge by
calling 1-800-279-7437. The Great Plains Prospectus, Annual Report and
Semi-Annual Report, as well as the Lancaster Prospectus, Annual Financial
Statement and Semi-Annual Financial Statement, are included in your package.
2
<PAGE>
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved these securities, or determined if this
Proxy Statement/Prospectus is truthful or complete. Any representation to the
contrary is a criminal offense.
This Proxy Statement/Prospectus is dated May ___, 1999.
3
<PAGE>
SYNOPSIS
Who Is Asking For My Vote?
The Board of Directors of Lancaster is soliciting your proxy for use at the
Special Meeting of Shareholders of Lancaster to be held on June ___, 1999. The
purpose of the Special Meeting is to vote on the proposed Reorganization.
How Do Your Directors Recommend That You Vote On The Proposal?
The Directors recommend that you vote FOR the proposed Reorganization, in which
the assets and stated liabilities of each Lancaster Fund will be transferred to
a corresponding GP Fund in exchange for shares of equal value of that GP Fund.
Who Is Eligible To Vote?
If you owned shares of a Lancaster Fund of record at the close of business
on May 1, 1999, you are entitled to vote at the Special Meeting. On May 1, 1999,
the following shares of the Lancaster Funds were outstanding:
Shares Outstanding
Lancaster Fund on Record Date
Capital Builder Fund ("Capital Builder")
Convertible Fund ("Convertible")
Crestone Small Cap Fund ("Small Cap")
Government Quality Bond Fund ("Government")
You have one vote for each share you own. Fractional shares are voted
proportionately. Each Lancaster Fund votes separately on the Reorganization and
each Lancaster Fund must approve it before it is implemented. If you vote, sign
and return a proxy, we'll vote your shares exactly as you instruct us. If you've
sent us a proxy, you can revoke it:
o by mail (addressed to Lancaster's Secretary at 200 Centre Terrace,
1225 "L" Street, Lincoln, Nebraska 68508)
o in person at the meeting, by executing a subsequent proxy, or by
submitting a notice of revocation to Lancaster
4
<PAGE>
If you sign your proxy, but don't fill in a vote, your shares will be voted in
accordance with the Directors' recommendations. If any other business is brought
before the meeting, your shares will be voted at the Directors' discretion
What Is Being Proposed?
The Directors of your Lancaster Fund are recommending that you approve
the Reorganization. An Agreement and Plan of Reorganization provides for the
transfer of all of the assets and stated liabilities of:
o Capital Builder to Great Plains Equity Fund ("GP Equity") in exchange
for shares of GP Equity;
o Convertible to GP Equity in exchange for shares of GP Equity;
o Small Cap to Great Plains Premier Fund ("GP Premier") in exchange for
shares of GP Premier; and
o Government to Great Plains Intermediate Bond Fund ("GP Bond") in
exchange for shares of GP Bond.
Upon completion of the Reorganization:
o You will be a shareholder of a GP Fund, which has investment
objectives, fees and purchase and redemption procedures similar to
your Lancaster Fund
o You will own the same dollar value of GP Fund shares as you previously
owned in a Lancaster Fund o You should not experience federal income
tax consequences
o Lancaster will cease its operations and dissolve
All of Lancaster's expenses related to this Proxy Statement/Prospectus and the
Reorganization will be paid by SMITH HAYES Financial Services Corporation
("SMITH HAYES"), the Distributor of Lancaster. Great Plains' expenses will be
paid by its investment adviser.
RISK FACTORS
We believe that owning shares of a GP Fund will not involve any unique
or special risks compared to owning shares of a Lancaster Fund. However, we
can't guarantee that each GP Fund will achieve its investment objective.
5
<PAGE>
GP Equity invests mainly in domestic and foreign stocks. The U.S. stock
market is often volatile and unpredictable over short periods. Foreign equity
securities often are more volatile than U.S. securities. They may face a variety
of other risks. Some of these are:
o greater political, economic and legal instability
o currency exchange fluctuations
o different government regulatory schemes
o less publicly available information
o different accounting standards
Capital Builder and Convertible do not invest in foreign securities. Capital
Builder and Convertible are "diversified" portfolios and GP Equity is
"non-diversified." This means GP Equity may concentrate its investments (by
company or industry) more than Capital Builder and Convertible.
GP Premier also invests in domestic and foreign equity securities. It is
subject to all the risk factors discussed in the preceding paragraph. GP Premier
emphasizes investment in medium-to-smaller-capitalized companies. The stocks of
these companies often fluctuate more than stocks of larger companies. Small Cap
also invests in smaller companies. Small Cap has not invested in foreign
securities. Small Cap is a "diversified" portfolio and GP Premier is
"non-diversified."
GP Bond invests primarily in fixed income securities. So does
Government. Fixed income securities may decrease in value when interest rates
rise, or increase in value when interest rates decline. High yield securities
typically fluctuate in value more than investment grade securities. GP Bond and
Government both are "diversified" portfolios.
As with any mutual fund investment, there is a risk of losing the money
you have invested. For more detailed information, see "Introduction--Certain
Risk Factors to Consider" and "Investment Objectives and Policies" in the
Lancaster September 29, 1998 Prospectus and "Synopsis--Risk Factors" in the
Great Plains October 31, 1998 Prospectus.
6
<PAGE>
PROPOSAL: AGREEMENT AND PLAN OF REORGANIZATION
General Information
The Board of Directors of Lancaster has unanimously approved the
Agreement and Plan of Reorganization (the "Plan"). Lancaster Fund shareholders
now must vote on whether to proceed with the Plan. If the Plan is approved, each
GP Fund will purchase all of the assets of a corresponding Lancaster Fund in
exchange for shares of that GP Fund and the assumption by that GP Fund of the
stated liabilities of that Lancaster Fund (the "Reorganization"). The proposed
transaction will take place about June ___, 1999 (the "Exchange Date"). Each
Lancaster Fund will value its assets as of the close of regular session trading
on the New York Stock Exchange on the business day before the Exchange Date.
Each GP Fund will issue shares equal in value to the corresponding Lancaster
Fund shares then outstanding. The shares of each GP Fund will be distributed pro
rata to shareholders of the corresponding Lancaster Fund and the Lancaster Funds
will be terminated. Because this is a summary, it does not contain all the
information that may be important to you. You should read this entire document
and its exhibits, before you decide how to vote. A copy of the Plan is attached
as Exhibit A.
All shares of each Lancaster Fund and each GP Fund are in uncertificated
book-entry form. The exchange of shares will take place automatically on the
Exchange Date. You will not need to submit transmittal forms or other documents.
Shareholder Services and Privileges
You will enjoy all the same services and privileges as other shareholders
of Great Plains. You will also have the opportunity to exchange into portfolios
with a variety of investment objectives and policies, which Lancaster presently
does not offer. Purchase and redemption procedures for Great Plains are similar
to those of Lancaster.
Investment Objectives, Policies and Restrictions
The following table summarizes the investment objective, policies,
strategies and techniques of each GP Fund and compares them to the Lancaster
Fund in which you hold shares:
<TABLE>
<CAPTION>
GP Equity Capital Builder
<S> <C> <C>
o Investment Objective o Achieve total return o Long-term capital
(current income and capital appreciation with secondary
appreciation) over the objective of current income
long term
o Strategies, o Invests in non-diversified o Invests in a diversified
Techniques, Policies portfolio of common and portfolio of common and
preferred stocks, which will preferred stocks and
normally be at least 65% of convertible securities which
the portfolio will normally be at least 65%
of the portfolio
o Invests primarily in medium o Invests in companies of all
to large companies sizes
o May invest up to 35% in o Does not invest in foreign
foreign investments securities
o Investments selected on a o Investments selected on basis
"value" basis, that is, when of either "value" or "growth",
Adviser believes the security emphasizing price in
is undervalued in the market relation to earnings, cash
flow and book value
o May invest up to 100% of its o May invest up to 100% of its
assets in investment grade assets in investment grade
money market instruments money market instruments
for temporary defensive for temporary defensive
purposes purposes
7
<PAGE>
GP Equity Convertible
o Investment Objective o Achieve total return (current o Preservation of capital while
income and capital maximizing total return
appreciation) over the long (capital gains, interest and
term dividends)
o Strategies, o Invests in non-diversified o Invests at least 65% of
Techniques, Policies portfolio of common and assets in a diversified
preferred stocks, which will portfolio of bonds and
normally be at least 65% of preferred stock convertible
the portfolio into common stock
o Invests primarily in medium o May invest in companies of
to large companies any size
o May invest up to 35% in o Does not invest in foreign
foreign investments securities
o Investments selected on a o Investments selected on basis
"value" basis, that is, when of credit analysis of issuers
Adviser believes the security emphasizing fundamental
is undervalued in the factors, e.g., cash flow,
market asset or dividend coverage,
liquidation value
o May invest up to 100% of its o May invest up to 100% of its
assets in investment grade assets in investment grade
money market instruments for money market instruments
for temporary defensive temporary defensive purposes
purposes
8
<PAGE>
GP Premier Small Cap
o Investment Objective o Total return (current o Long-term capital
income and capital appreciation
appreciation) over the
long term
o Strategies, o Invests primarily in o Normally invests at least 90%
Techniques, Policies non-diversified portfolio of of assets in diversified
common and preferred stocks portfolio of companies having
of issuers having market average market capitalization
capitalization under $1 between $350 million and $600
billion million
o May invest up to 35% in o Does not invest in foreign
foreign securities securities
o Investments selected on a o Investments selected on
"value" basis, that is, "growth at a discount" strategy,
When Adviser believes the that is, companies which have
security is undervalued in above-average potential for stock price
the market growth, trade at a discount to
S&P 500 price-earnings ratio
and have consistent historical earnings
o May invest up to 100% of its o May invest up to 100% of its
assets in investment grade assets in investment grade
money market instruments money market instruments for
for temporary defensive temporary defensive purposes
purposes
9
<PAGE>
GP Bond Government
o Investment Objective o Total return (current income o Income with capital
and capital appreciation) appreciation consistent with
preservation of capital
o Strategies, o Normally invests 65% of o Invests solely in U.S.
Techniques, Policies assets in diversified Government securities,
portfolio of investment grade repurchase agreements
bonds collateralized by U.S.
Government securities and
corporate bonds rated A or
better by Moody's or Standard
& Poors
o May invest up to 35% in below o Normally invests at least 65%
investment grade securities, in U.S. Government securities
but usually will not so and no more than 10% in
invest more than 15% corporate bonds
o Average dollar-weighted o Average dollar-weighted
maturity will normally be maturity will not exceed ten
three to ten years years
o May invest up to 100% of its o May invest up to 100% of its
assets in investment grade assets in investment grade
money market instruments for money market instruments for
temporary defensive purposes temporary defensive purposes
</TABLE>
This is only a summary. The Great Plains Prospectus dated October 31,
1998, and the Lancaster Fund Prospectus dated September 29, 1998, both included
in your package, contain a detailed description of the investment objectives,
policies and restrictions of each GP Fund and each Lancaster Fund.
10
<PAGE>
Background and Reasons for the Proposed Reorganization
The Board of Directors of Lancaster, including all of the Directors who
are not "interested persons" as defined by the Investment Company Act of 1940
(the "Disinterested Directors"), unanimously concluded that the Reorganization
will be in your best interests, and that your interest in a Lancaster Fund will
not be diluted as a result of the Reorganization. The Lancaster Directors have
submitted the Reorganization for approval by the Lancaster Fund shareholders at
the Special Meeting on June ___, 1999. The Reorganization will be implemented if
a majority of the outstanding shares of each Lancaster Fund vote in favor of it.
The Directors of Lancaster approved the Reorganization because they
believe it will benefit shareholders of the Lancaster Funds. The Directors
considered a number of factors in reaching their decision. Some of these factors
are:
o the investment objectives, strategies and past performance of the
GP Funds
o First Commerce Investors, Inc. (the "GP Adviser") will manage the
investments of the GP Funds in a similar manner as CONLEY SMITH
Investment Advisers, Inc. ("CSI") has managed the assets of the
Lancaster Funds
o the capabilities and resources of the other service providers of
Great Plains in the areas of marketing, investment and
shareholder services
o the expenses and advisory fees applicable to the Lancaster Funds
before the Reorganization and the estimated expense ratios of the
GP Funds after the Reorganization
o the terms and conditions of the Plan and whether the proposed
Reorganization will dilute the Lancaster Fund shareholder
interests
o economies of scale which may be realized in the future (although
not presently determined) through the Reorganization
o the assumption by SMITH HAYES of the Lancaster Funds' costs
estimated to be incurred to complete the Reorganization
o the future growth prospects of the GP Funds
The Directors of Lancaster reviewed information provided by the GP
Adviser concerning the impact of the Reorganization. The Directors also
conferred with representatives of Great Plains, SMITH HAYES, and CSI, and held
discussions with counsel. The Directors determined that the following results
are likely, though not guaranteed:
o Great Plains will have a greater ability to attract and retain
investors than would Lancaster alone
o combining the net assets of each Lancaster Fund with the assets
of a corresponding GP Fund should reduce total operating
expenses, on a per share basis, by allowing some costs, such as
accounting, legal and printing expenses, to be spread over a
larger asset base
o consolidating the Lancaster Funds and the GP Funds should
eliminate duplication of services and expenses and promote more
efficient and cost-effective operations in the future
11
<PAGE>
Prior to approving the Plan, the Directors of Lancaster were advised by
SMITH HAYES that it will receive a fee from the parent of the GP Adviser. In
return, SMITH HAYES will assist in completing the Reorganization by:
o transferring assets and shareholder records
o filing final tax returns
o preparing the other documents related to the dissolution of the
Lancaster Funds
The fee is equal to approximately .026% of the net assets of the Lancaster Funds
transferred to Great Plains in the Reorganization, subject to reduction to
reflect share redemptions by former Lancaster Fund shareholders within three
years. The fee will be paid in stock of the GP Adviser's parent valued at its
approximate fair market value on the Exchange Date. SMITH HAYES and the GP
Adviser have advised the Directors they believe payment of such a fee is a
common practice and that the amount of the fee is reasonable under the
circumstances.
The Trustees of Great Plains, none of whom is an "interested person,"
unanimously concluded the Reorganization will be in the best interests of Great
Plains shareholders and that the interests of Great Plains will not be diluted
as a result of the Reorganization.
Expense Summary
The purpose of the following tables is to inform you of the various
costs and expenses you will bear, directly or indirectly, as a shareholder of a
GP Fund, and to compare those costs and expenses with the costs and expenses you
bore as a shareholder of a corresponding Lancaster Fund during the past fiscal
year.
Shareholder Transaction Expenses
<TABLE>
<CAPTION>
Lancaster Lancaster
Great Plains Funds Capital Funds Capital
Equity Fund Builder Investor Builder Select
<S> <C> <C> <C>
Maximum Sales Load Imposed on Purchases 3.00% 0.00% 3.90%
(as a % of offering price)
Lancaster Funds Lancaster Funds
Great Plains Convertible Convertible
Equity Fund Investor Select
Maximum Sales Load Imposed on Purchases 3.00% 0.00% 3.90%
(as a % of offering price)
Lancaster Funds Lancaster Funds
Great Plains Crestone Small Crestone Small
Premier Fund Cap Investor Cap Select
Maximum Sales Load Imposed on Purchases 3.00% 0.00% 3.90%
(as a % of offering price)
Lancaster Funds Lancaster Funds
Great Plains Gov't/Quality Gov't/Quality
Int. Bond Fund Investor Select
Maximum Sales Load Imposed on Purchases 3.00% 0.00% 1.50%
(as a % of offering price)
</TABLE>
12
<PAGE>
Annual Fund Operating Expenses
Equity/Capital Builder
Great Plains Lancaster Capital Lancaster Capital
Equity Fund Builder Investor Builder Select
Management Fees 0.75% 1.00% 1.00%
Rule 12b-1 Fees 0.00% 0.50% 0.00%
Other Expenses 0.27% 0.20% 0.20%
----- ----- -----
1.02% 1.70% 1.20%
Example
Shareholders would pay the following expenses on a $10,000
investment, assuming a 5% annual return.
Great Plains Lancaster Capital Lancaster Capital
Equity Fund Builder Investor Builder Select
1 Year $401 $179 $508
3 Years $615 $553 $756
5 Years $846 $949 $1,024
10 Years $1,510 $2,031 $1,788
Annual Fund Operating Expenses
Equity/Convertible
Great Plains Lancaster Lancaster
Equity Fund Convertible Investor Convertible Select
Management Fees 0.75% 1.00% 1.00%
Rule 12b-1 Fees 0.00% 0.50% 0.00%
Other Expenses 0.27% 0.41% 0.41%
----- ----- -----
1.02% 1.91% 1.41%
Example
Shareholders would pay the following expenses on a $10,000
investment, assuming a 5% annual return.
Great Plains Lancaster Lancaster
Equity Fund Convertible Investor Convertible Select
1 Year $401 $201 $528
3 Years $615 $620 $819
5 Years $846 $1,062 $1,131
10 Years $1,510 $2,262 $2,015
13
<PAGE>
Annual Fund Operating Expenses
Premier/Crestone Small Cap
Great Plains Lancaster Crestone Lancaster Crestone
Premier Fund Small Cap Investor Small Cap Select
Management Fees 1.00% 1.00% 1.00%
Rule 12b-1 Fees 0.00% 0.50% 0.00%
Other Expenses 0.84% 0.20% 0.20%
----- ----- -----
1.84%(3) 1.70% 1.20%
(1) After voluntary waiver by the investment adviser, the actual management fee
charged to the Great Plains Premier Fund was 0.80%.
(2) After voluntary waiver by the administrator, the actual other expenses
incurred by the Great Plains Premier Fund was 0.84%.
(3) The total fee paid by the fund after waivers was 1.44%.
Example
Shareholders would pay the following expenses on a $10,000
investment, assuming a 5% annual return.
Great Plains Lancaster Crestone Lancaster Crestone
Premier Fund * Small Cap Investor Small Cap Select
1 Year $442 $179 $508
3 Years $861 $553 $756
5 Years $1,266 $949 $1,024
10 Years $2,394 $2,031 $1,788
* Expenses quoted at the net fee rate of 1.44% for the first year and at the
gross fee rate, before waivers, of 1.84% for years 3, 5 and 10.
Annual Fund Operating Expenses
Intermediate Bond/Government/Quality Bond
Great Plains Int. Lancaster Gov't/ Lancaster Gov't/
Bond Fund Quality Investor Quality Select
Management Fees 0.50% 0.85% 0.85%
Rule 12b-1 Fees 0.00% 0.25% 0.00%
Other Expenses 0.29% 0.55% 0.55%
----- ----- -----
0.79% 1.65% 1.40%
Example
Shareholders would pay the following expenses on a $10,000
investment, assuming a 5% annual return.
Great Plains Int. Lancaster Gov't/ Lancaster Gov't/
Bond Fund Quality Investor Quality Select
1 Year $378 $173 $290
3 Years $545 $537 $586
5 Years $726 $922 $904
10 Years $1,249 $1,976 $1,805
14
<PAGE>
Federal Income Tax Consequences
Cline, Williams, Wright, Johnson & Oldfather has given a legal opinion
to Lancaster and Great Plains to the effect that for Federal income tax
purposes:
o transferring all the assets and liabilities of each Lancaster Fund to
the corresponding GP Fund in exchange for shares of that GP Fund and
distributing those GP Fund shares to shareholders of the Lancaster Fund
will constitute a "reorganization" under Section 368(a)(1)(C) of the
Internal Revenue Code of 1986, as amended (the "Code")
o under Sections 361(a), 361(c)(1) and 357(a) of the Code, no gain or loss
will be recognized by a Lancaster Fund as a result of the Reorganization
o under Section 354(a)(1) of the Code, you will recognize no gain or loss
because of the distribution to you of shares of a GP Fund
o under Section 358(a)(1) of the Code, the basis of the GP Fund shares you
receive will be the same as the basis of your Lancaster Fund shares
immediately before the Exchange Date
o under Section 362(b) of the Code, the basis to each GP Fund of the
assets of a Lancaster Fund received will be the same as the basis of the
assets in the hands of that Lancaster Fund immediately before the
Reorganization
o under Section 1223(1) of the Code, your holding period for your shares
of a GP Fund will include the period you held your shares of the
corresponding Lancaster Fund, if your shares of the Lancaster Fund were
held as a capital asset
o under Section 1223(2) of the Code, the holding period for each GP Fund
with respect to the assets received in the Reorganization will include
the period for which such assets were held by the corresponding
Lancaster Fund
Neither Lancaster nor Great Plains has sought a tax ruling from the
Internal Revenue Service ("IRS"). The opinion of counsel is not binding on the
IRS, and the IRS could take a contrary position. You should consult your own
adviser concerning the potential tax consequences to you, including state and
local income tax consequences.
Both Great Plains and Lancaster comply with Subchapter M of the Code
and, as a result, do not pay any corporate level federal or state income tax.
15
<PAGE>
Shares and Shareholder Rights
Each GP Fund is a series of Great Plains, a business trust organized
under Massachusetts law. Great Plains' Declaration of Trust permits its Trustees
to issue an unlimited number of shares, without par value, from each series that
is designated by the Board of Trustees. Each share of a series:
o represents an equal proportionate interest in the assets and
liabilities of that series
o is entitled to dividends and distributions out of the income
belonging to the series as declared by the Trustees
o has no cumulative voting rights or preemptive rights
o in case of a liquidation, subject to the rights of creditors, is
entitled to receive a proportionate distribution out of the net
assets belonging to that series
Under certain conditions, shareholders of a Massachusetts business trust
could be deemed to have the same type of personal liability for the obligations
of a GP Fund as does a partner of a partnership. The Declaration of Trust
disclaims liability on the part of GP Fund shareholders and provides that Great
Plains will assume the defense on behalf of its shareholders. Thus, the risk of
GP Fund shareholder liability is slight and limited to a circumstance where a
series itself is unable to meet its obligations.
Great Plains legally is not required to, and does not intend to, hold
annual shareholders' meetings. GP Fund shareholders will vote on:
o the election or removal of Trustees if a meeting is called for
that purpose
o any contract required to be approved by shareholders under the
Investment Company Act of 1940, as amended (the "1940 Act")
o any termination or reorganization of Great Plains or any series
of Great Plains to the extent provided in the Declaration of
Trust
o any amendment of the Declaration of Trust requiring shareholder
approval (other than amendments designating new series, or making
certain other technical changes)
Meetings of GP Fund shareholders may be called by shareholders holding at least
25% (or 10% if the purpose of the meeting is to determine if a Trustee is to be
removed from office) of the shares then outstanding. Shareholders will receive
assistance from Great Plains in communicating with other shareholders about a
proposed removal of a Trustee.
16
<PAGE>
Each Lancaster Fund is a series of SMITH HAYES Trust, Inc., a Minnesota
corporation. For a detailed description of the characteristics of the shares of
Lancaster and the rights of its shareholders, see "General Information" in the
September 29, 1998 Prospectus of Lancaster. There are no significant differences
in the rights of shareholders of Lancaster and Great Plains.
Capitalization
The following table shows the capitalization of each Lancaster Fund and
each corresponding GP Fund as of February 28, 1999 and the pro forma
capitalization of the combined GP Fund-Lancaster Fund as if all relevant
Reorganization transactions occurred on February 28, 1999:
Net Asset
Total Net Shares Value
Assets Outstanding Per Share
- -------------------------- --------------------- -------------------- ----------
Capital Builder Investor $8,450,395 644,602 $13.11
Capital Builder Select $472,882 35,892 $13.18
Convertible Investor $3,048,301 234,550 $13.00
Convertible Select $234,257 18,009 $13.01
GP Equity $183,159,483 17,238,370 $10.63
------------
Pro forma combined $195,365,319 18,387,144 $10.63
============
Small Cap Investor $2,561,790 246,622 $10.39
Small Cap Select $176,355 16,697 $10.56
GP Premier $22,931,680 2,707,673 $8.47
-----------
Pro forma combined $25,669,825 3,030,676 $8.47
===========
Government Investor $642,828 62,154 $10.34
Government Select $30,409 2,939 $10.35
GP Intermediate Bond $134,362,320 13,211,083 $10.17
-----------
Pro Forma combined 135,035,557 13,277,833 $10.17
===========
17
<PAGE>
Comparative Performance Information
The chart below shows each Lancaster Fund's and each corresponding GP
Fund's annual returns for the past five years. The table shows the average
annual returns of each Lancaster Fund and each GP Fund and its market benchmark
for the 1-, 5-year and inception periods ending December 31, 1998. This
information is intended to help you assess the risk of investing in each fund by
showing how each fund's total return has varied from year to year and by
comparing each fund's performance to the most commonly used index for its market
segment. Of course, past performance is no guarantee of future results.
Lancaster Funds Capital Builder Fund - Calendar Year Annual Returns
The annual returns shown below are calculated on investment without a
sales Charge. If a sales charge had been paid, the returns would have
been less than those shown .
Capital Builder Investor Capital Builder Select
1996 19.11%
1997 19.38%
1998 10.28% 1998 10.79%
<TABLE>
<CAPTION>
<S> <C> <C>
During the period described above in the bar During the period described above in the bar
chart, Capital Builder Investor shares' highest chart, Capital Builder Select shares' highest
quarterly return was 18.65% for the quarter quarterly return was 18.77% for the quarter
ended September 30, 1998 ended December 31, 1998
and its lowest quarterly return was (15.46%) and its lowest quarterly return was (15.29%)
for the quarter ended December 31, 1998. The for the quarter ended September 30, 1998.
1999 year-to-date return on The 1999 year-to-date return on
March 31, 1999 was 3.12%. March 31, 1999 was 3.18%
</TABLE>
Great Plains Equity Fund - Calendar Year Annual Returns
The annual returns shown below are calculated on investment without a
sales Charge. If a sales charge had been paid, the returns would have
been less than those shown .
Great Plains Equity
1989 23.89%
1990 (5.86%)
1991 24.39%
1992 7.53%
1993 6.34%
1994 0.56%
1995 30.33%
1996 23.36%
1997 25.82%
1998 17.92%
During the period described above in the bar chart, Equity Fund's
highest quarterly return was 15.90% for the quarter ended
December 31, 1998, and its lowest quarterly return was (10.86%)
for the quarter ended September 30, 1990.
The 1999 year-to-date return on March 31, 1999 was (3.99%).
Past performance is not indicative of future results. Investment return and
principal value will fluctuate so when shares are redeemed, they may be worth
more or less than the original cost. Total return represents the change in the
value of an investment after reinvesting all income and capital gains.
Performance does not reflect the maximum sales charge of 3% which is waived for
purchases through the trust department of National Bank of Commerce. The quoted
performance data includes the performance of a common trust fund advised by
First Commerce Investors, Inc., or the period before the date on which the Fund
commenced operations (9/26/97), as adjusted to reflect the Fund's anticipated
expenses as set forth in the "Expenses of the Fund" section of the Fund's
initial prospectus. The common trust fund was not registered under the
Investment Company Act of 1940 (the "1940 Act"), and therefore was not subject
to certain investment restrictions that are imposed by the 1940 Act. If the
common trust fund had been registered under the 1940 Act, the performance may
have been adversely affected.
18
<PAGE>
Lancaster Funds Convertible Fund - Calendar Year Annual Returns
The annual returns shown below are calculated on investment without a
sales Charge. If a sales charge had been paid, the returns would have
been less than those shown .
Convertible Investor Shares Convertible Select Shares
1989 12.06%
1990 (5.77%)
1991 28.64%
1992 10.26%
1993 16.39%
1994 (7.98%)
1995 26.26%
1996 14.75%
1997 22.42%
1998 6.84% 1998 7.34%
<TABLE>
<CAPTION>
<S> <C> <C>
During the period described above in the bar During the period described above in the bar
chart, Convertible Investor shares' highest chart, Convertible Select shares' highest
quarterly return was 18.77% for quarterly return was 13.82% for
the quarter ended December 31, 1998, the quarter ended December 31, 1998,
and its lowest quarterly return was (15.29%) and its lowest quarterly return was (14.94%)
for the quarter ended September 30, 1998. The for the quarter ended September 30, 1998.
1999 year-to-date return on March 31, The 1999 year-to-date return on March 31, 1999 was 1.84%.
1999 was 2.31%.
</TABLE>
Great Plains Equity Fund - Calendar Year Annual Returns
The annual returns shown below are calculated on investment without a
sales charge. If a sales charge had been paid, the returns would have
been less than those shown .
Great Plains Equity
1999 23.89%
2000 (5.86%)
2001 24.39%
2002 7.53%
2003 6.34%
2004 0.56%
2005 30.33%
2006 23.36%
2007 25.82%
2008 17.92%
During the period described above in the bar chart, Equity Fund's
highest quarterly return was 15.90% for the quarter ended
December 31, 1998, and its lowest quarterly return was (10.86%)
for the quarter ended September 30, 1990.
The 1999 year-to-date return on March 31, 1999 was (3.99%).
Past performance is not indicative of future results. Investment return and
principal value will fluctuate so when shares are redeemed, they may be worth
more or less than the original cost. Total return represents the change in the
value of an investment after reinvesting all income and capital gains.
Performance does not reflect the maximum sales charge of 3% which is waived for
purchases through the trust department of National Bank of Commerce. The quoted
performance data includes the performance of a common trust fund advised by
First Commerce Investors, Inc., for the period before the date on which the Fund
commenced operations (9/26/97), as adjusted to reflect the Fund's anticipated
expenses as set forth in the "Expenses of the Fund" section of the Fund's
initial prospectus. The common trust fund was not registered under the
Investment Company Act of 1940 (the "1940 Act"), and there fore was not subject
to certain investment restrictions that are imposed by the 1940 Act. If the
common trust fund had been registered under the 1940 Act, the performance may
have been adversely affected.
19
<PAGE>
Lancaster Funds Crestone Small Cap Fund - Calendar Year Annual Returns
The annual returns shown below are calculated on investment without a
sales Charge. If a sales charge had been paid, the returns would have
been less than those shown .
Small Cap Investor Small Cap Select
1993 12.32%
1994 2.46%
1995 21.13%
1996 24.37%
1997 8.48% 1997 8.98%
1998 (10.85%) 1998 (10.25%)
<TABLE>
<CAPTION>
<S> <C> <C>
During the period described above in the bar During the period described above in the bar
chart, Crestone Small Cap Investor shares' chart, Crestone Small Cap Select shares'
highest quarterly return was 19.19% for the highest quarterly return was 19.10% for the
quarter ended December 31, 1998 and its quarter ended December 31,
lowest quarterly return was (28.11%) 1998 and its lowest quarterly return was (27.76%)
for the quarter ended September 30, 1998. The for the quarter ended September 30, 1998. The 1999
1999 year-to-date return on March 31, 1999 was year-to-date return on March 31, 1999 was
(13.19%). (12.92%).
</TABLE>
Great Plains Premier Fund - Calendar Year Annual Returns
The annual returns shown below are calculated on investment without a
sales charge. If a sales charge had been paid, the returns would have
been less than those shown .
Great Plains Premier
1989 5.42%
1990 (6.99%)
1991 31.36%
1992 6.25%
1993 8.60%
1994 (1.27%)
1995 26.63%
1996 21.68%
1997 28.12%
1998 0.61%
During the period described above in the bar chart, Premier
Fund's highest quarterly return was 17.65% for the quarter ended
June 30, 1997, and its lowest quarterly return was (18.38%) for
the quarter ended September 30, 1998. The 1999 year-to-date
return on March 31, 1999 was (13.68%).
Past performance is not indicative of future results. Investment return and
principal value will fluctuate so when shares are redeemed, they may be worth
more or less than the original cost. Total return represents the change in the
value of an investment after reinvesting all income and capital gains.
Performance does not reflect the maximum sales charge of 3% which is waived for
purchases through the trust department of National Bank of Commerce.
The quoted performance data includes the performance of a common trust fund
advised by First Commerce Investors, Inc., for the period before the date on
which the Fund commenced operations (9/26/97), as adjusted to reflect the Fund's
anticipated expenses as set forth in the "Expenses of the Fund" section of the
Fund's initial prospectus. The common trust fund was not registered under the
Investment Company Act of 1940 (the "1940 Act"), and there fore was not subject
to certain investment restrictions that are imposed by the 1940 Act. If the
common trust fund had been registered under the 1940 Act, the performance may
have been adversely affected.
20
<PAGE>
Lancaster Funds Government/Quality Bond Fund - Calendar Year Annual Returns The
annual returns shown below are calculated on investment without a sales
Charge. If a sales charge had been paid, the returns would have been
less than those shown .
Governmen Investor Government Select
1989 12.41%
1990 10.46%
1991 14.28%
1992 6.68%
1993 8.23%
1994 (3.35%)
1995 13.59%
1996 2.34%
1997 6.99%
1998 5.17% 1998 5.35%
<TABLE>
<CAPTION>
<S> <C> <C>
During the period described above in the bar During the period described above in the bar
chart, Government/Quality Bond Investor shares' chart, Government/Quality Bond Select shares'
highest quarterly return was 7.19% for the highest quarterly return was 2.52% for the
quarter ended June 30, 1989 quarter ended September 30, 1998
and its lowest quarterly return was and its lowest quarterly return was
(2.66%) for the quarter ended March 31, 1994. Was (0.06%) for the quarter ended December 31, 1998.
The 1999 year-to-date return on March 31, 1999 The 1999 year-to-date return on March 31,
was .48%. 1999 was .58%.
</TABLE>
Great Plains Intermediate Bond Fund - Calendar Year Annual Returns The annual
returns shown below are calculated on investment without a sales charge.
If a sales charge had been paid, the returns would have been less than
those shown .
Great Plains Intermediate Bond
1989 11.47%
1990 8.38%
1991 14.40%
1992 6.51%
1993 9.49%
1994 (4.40%)
1995 17.90%
1996 2.37%
1997 9.12%
1998 9.07%
During the period described above in the bar chart, Intermediate
Bond Fund's highest quarterly return was 6.08% for the quarter
ended June 30, 1995, and its lowest quarterly return was (3.24%)
for the quarter ended March 31, 1994. The 1999 year-to-date
return on March 31, 1999 was (1.02%)
Past performance is not indicative of future results. Investment return and
principal value will fluctuate so when shares are redeemed, they may be worth
more or less than the original cost. Total return represents the change in the
value of an investment after reinvesting all income and capital gains.
Performance does not reflect the maximum sales charge of 3% which is waived for
purchases through the trust department of National Bank of Commerce. The quoted
performance data includes the performance of a common trust fund advised by
First Commerce Investors, Inc., for the period before the date on which the Fund
commenced operations (9/26/97), as adjusted to reflect the Fund's anticipated
expenses as set forth in the "Expenses of the Fund" section of the Fund's
initial prospectus. The common trust fund was not registered under the
Investment Company Act of 1940 (the "1940 Act"), and there fore was not subject
to certain investment restrictions that are imposed by the 1940 Act. If the
common trust fund had been registered under the 1940 Act, the performance may
have been adversely affected.
21
<PAGE>
Return Table
Average Annual Returns through December 31, 1998
Since
One Year Five Year Ten Year Inception
Capital Builder Investor 10.28% n/a n/a 17.91%
Capital Builder Select* 10.79% n/a n/a 15.05%
GP Equity** 17.92% 19.12% 14.81% 14.60%
Lipper Growth & Income Fund Index*** 13.60% 17.80% 15.50% n/a
Convertible Investor 6.84% 11.76% 11.76% 10.52%
Convertible Select* 7.34% n/a n/a 12.93%
GP Equity** 17.92% 19.12% 14.81% 14.60%
Lipper Growth & Income Fund Index*** 13.60% 17.80% 15.50% n/a
Small Cap Investor (10.85%) 8.34% n/a 10.21%
Small Cap Select* (10.25%) n/a n/a 3.56%
GP Premier** 0.61% 14.42% 11.29% 10.97%
Lipper Small-Cap Fund Index*** (0.90%) 11.30% 13.20% n/a
Government Investor 5.17% 4.80% 7.19% 7.02%
Government Select* 5.35% n/a n/a 6.40%
GP Bond** 9.07% 6.55% 8.27% 8.21%
Lipper Intermediate U.S. Government
Fund Index*** 8.20% 6.10% 7.50% n/a
Investment return and principal value will fluctuate so when shares are
redeemed, they may be worth more or less than the original cost. Total return
represents the change in the value of an investment after reinvesting all income
and capital gains.
* Excludes maximum sales charge of 3.9% (1.5% for Government).
** Performance does not reflect the maximum sales charge of 3% which is waived
for purchases through the trust department of National Bank of Commerce. If a
sales charge had been paid the return would have been less than is shown in the
table. The quoted performance data includes the performance of a common trust
fund advised by First Commerce Investors, Inc., for the period before the date
on which the Fund commenced operations (9/26/97), as adjusted to reflect the
Fund's anticipated expenses as set forth in the "Expenses of the Fund" section
of the Fund's initial prospectus. The common trust fund was not registered under
the Investment Company Act of 1940 (the "1940 Act"), and there fore was not
subject to certain investment restrictions that are imposed by the 1940 Act. If
the common trust fund had been registered under the 1940 Act, the performance
may have been adversely affected.
*** Lipper figures represent the average of the total returns reported by the
largest mutual funds designated by Lipper Analytical Services, Inc. as falling
into the respective categories indicated. These figures do not reflect sales
charges.
22
<PAGE>
GREAT PLAINS FUNDS
General. Great Plains is a management investment company organized as an
unincorporated business trust in July, 1997. Each GP Fund is an open-end series
of Great Plains. The accompanying Great Plains Prospectus dated October 31, 1998
contains a general discussion of Great Plains. For the convenience of Lancaster
Fund shareholders, cross-references to that Prospectus are set forth below.
Certain Expenses and Financial Information. The Great Plains Prospectus includes
information on per-share income and capital changes under the heading "Financial
Highlights." For a discussion of each GP Fund's expenses, see "Proposal:
Agreement and Plan of Reorganization--Expense Summary" above and "Summary of
Fund Expenses" in the Great Plains Prospectus.
Investment Objectives and Policies. For a discussion of each GP Fund's
investment objectives and policies, see "Synopsis" and "Fund Objectives and
Policies" in the Great Plains Prospectus.
Trustees and Officers. The Board of Trustees exercises overall responsibility
for management of Great Plains. The Trustees are elected by the shareholders of
all the series of Great Plains. There are currently four Trustees, none of whom
is an "interested person" within the meaning of that term under the 1940 Act.
The Trustees elect the officers to supervise actively its day-to-day operations.
The names of the Trustees and officers of Great Plains, their addresses, their
ages as of March 31, 1999 and principal occupations during the past five years
are as follows:
23
<PAGE>
<TABLE>
<CAPTION>
Position(s) Held
Name, Address with Principal Occupation(s)
and Age Great Plains During Past 5 Years
------- ------------ -------------------
<S> <C> <C> <C>
Hugh Hansen@ Trustee Consultant, First Commerce Bancshares,
1325 Fall Creek Road Inc.; Formerly, President, COO and
Lincoln, NE 68510 Director, First Commerce Bancshares,
71 Inc.; Formerly, Vice Chairman and Director,
National Bank of Commerce; Formerly,
Chairman and Director, North Platte
National Bank; Formerly, Director, First
National Bank, Kearney, NE, McCook,
NE and West Point, NE; Formerly,
Director, First Commerce Mortgage Co.;
Formerly, Director, Overland National
Bank; Formerly, Director, NBC Computer
Services Corporation
George E. Howard@+ Trustee Formerly, Chairman and CEO, Lincoln Mutual
3901 South 27th St., #50 Life Insurance Company
Lincoln, NE 68508
74
Dr. Martin A. Massengale + Trustee Foundation Distinguished Professor,
220 Keim Hall President Emeritus, Director of
University of Nebraska-Lincoln Center for Grassland Studies,
Lincoln, NE 68583-0953 University of Nebraska; Director,
65 IBP, Inc., American First Companies
LLC, and Woodmen Life and Accident
Company
Keith C. Mitchell Trustee Vice President and Chief Financial
2331 Woodscrest Avenue Officer, MDS-Harris; Financial
Lincoln, NE 68502 Consultant; Director, Cliff's
55 Notes, Inc.; Former General
Partner, Deloitte & Touche LLP
Edward C. Gonzales President Vice Chairman, Federated Investors,
Federated Investors Tower Inc.; Vice President, Federated
Pittsburgh, PA 15222 Advisers, Federated Management,
68 Federated Research, Federated
Research Corp., Federated Global
Research Corp. and Passport
Research, Ltd.; Executive Vice
President and Director, Federated
Securities Corp.; Trustee,
Federated Shareholder Services
Company; Trustee or Director of
certain investment companies
distributed, organized, or advised
by Federated Investors, Inc. and
its affiliates (Federated Funds);
President, Executive Vice President
and Treasurer of some of the
Federated Funds
James Stuart, III Vice President Chairman and Chief Executive
610 NBC Center Officer, First Commerce Investors,
1248 "O" Street Inc.; Director, First Commerce
Lincoln, NE 68508 Bancshares, Inc.; Director,
35 National Bank of Commerce; Chief
Investment Officer and Secretary,
Stuart Global Investment Company,
BVI; James Stuart, III Sole
Proprietorship, Consultant; Executive
Vice President, Stuart Investment Co.
Anne E. Hansen Vice President Vice President, First Commerce
610 NBC Center Investors, Inc.
1248 "O" Street
Lincoln, NE 68508
38
Beth S. Broderick Vice President and Assistant Vice President, Federated
Federated Investors Tower Treasurer Administrative Services since
Pittsburgh, PA 15222 1997; Client Services Officer,
33 Federated Administrative Services
from 1992 to 1997
Gail Cagney Secretary Corporate Counsel, Vice President,
Federated Investors Tower Federated Administrative Services
Pittsburgh, PA 15222 since 1997; previously Associate
45 Counsel (1993-1997) and Staff
Attorney (1991-1993), Federated
Administrative Services
@ Member of the Executive Committee, which generally exercises the authority of
the Board between meetings of the Board.
+ Member of the Audit Committee
</TABLE>
24
<PAGE>
Investment Adviser. For a discussion of the GP Adviser, the services performed
by it and its fees, see "Great Plains Funds Information" in the Great Plains
Prospectus.
Administrator. For a discussion of Federated Administrative Services' activities
as Administrator and Portfolio Accountant, the services performed by it and its
fees, see "Administration of the Trust" in the Great Plains Prospectus.
Distributor. For a discussion of Edgewood Services, Inc.'s activities as the
Great Plains distributor, the services performed by it and its fees, see "Great
Plains Funds Information--Distribution of Fund Shares" in the Great Plains
Prospectus.
Shares. For a discussion of voting rights of shares of Great Plains, see
"Shareholder Information" in the Great Plains Prospectus and "Shares and
Shareholder Rights" above.
Purchase and Redemption of Shares. For a discussion concerning purchase
procedures, pricing and redemption of shares of Great Plains, see "Net Asset
Value", "Investing in the Funds" and "Redeeming Shares" in the Great Plains
Prospectus.
Dividends, Distributions and Tax Matters. For a discussion of Great Plains'
policies with respect to dividends and distributions, see "Investing in the
Funds--Dividends and Capital Gains" and "Tax Information" in the Great Plains
Prospectus.
Exchange Privileges. For a discussion of a GP Fund shareholder's right to
exchange shares for shares of another GP Fund, see "Exchange Privilege" in the
Great Plains Prospectus.
Legal Proceedings. Great Plains is not presently involved in any important legal
proceedings.
Shareholder Inquiries. Shareholder inquiries relating to any GP Fund may be
addressed by writing to Great Plains Funds, 5800 Corporate Drive, Pittsburgh,
Pennsylvania 15237-7010, or by calling toll free 1-800-568-8257.
Management Discussion of Fund Performance. Management's discussion of the
performance of each GP Fund is located in the Great Plains Annual Report dated
August 31, 1998, and the Great Plains Semi-Annual Report dated February 28,
1999. Both of these reports are included in your package. Both are deemed to be
legally a part of this document.
LANCASTER FUNDS
General. Each Lancaster Fund is a series of SMITH HAYES Trust, Inc., a Minnesota
corporation organized in 1988 which operates as an open-end management
investment company and does business under the name "Lancaster Funds." The
accompanying Lancaster Prospectus dated September 28, 1998 contains a general
discussion of each Lancaster Fund. For the convenience of shareholders, certain
cross-references to that Prospectus are set forth below.
Certain Expenses and Financial Information. The Lancaster Prospectus contains
information on per-share income and capital changes, under the heading
"Financial Highlights." For a discussion of each Lancaster Fund's expenses, see
"Proposal: Agreement and Plan of Reorganization--Expense Summary" above and
"Expenses" in the Lancaster Prospectus.
Investment Objectives and Policies. For a discussion of each Lancaster Fund's
investment objectives and policies, see "Investment Objectives and Policies" and
"Investment Practices" in the Lancaster Prospectus.
Directors and Officers. The Board of Directors exercises overall responsibility
for management of Lancaster Fund. The Directors are elected by all shareholders
of SMITH HAYES Trust, Inc. The Directors elect the officers to supervise
actively the day-to-day operations.
The names of the Directors and officers, their addresses, their ages as of March
31, 1999 and their principal occupations during the past five years are as
follows:
25
<PAGE>
<TABLE>
<CAPTION>
Name, Address Position(s) Principal Occupation
and Age Held with Fund Last Five Years
- ---------------------------- --------------------------- -------------------------------------
<S> <C> <C>
Thomas C. Smith* Chairman, President, Chairman, CONLEY SMITH Investment
200 Centre Terrace Chief Executive Officer, Advisers, Inc., Omaha, Nebraska;
1225 "L" Street Treasurer Chairman and President, SMITH HAYES
Lincoln, NE 68508 Financial Services Corporation,
53 Lincoln, Nebraska; Vice President,
Lancaster Administrative Services,
Inc., Lincoln, Nebraska; Chairman
and President, Consolidated
Investment Corporation, Lincoln,
Nebraska; Vice President and
Director, Concorde Management and
Development, Inc., Lincoln,
Nebraska; Chairman, SMITH HAYES
Advisers, Inc., Lincoln, Nebraska
Thomas D. Potter Director President and Chief Executive
1800 Memorial Drive Officer, Lincoln, Mutual Life
Lincoln, NE 68508 Insurance Company, Lincoln,
58 Nebraska; December 1987-Current
Dale C. Tinstman Director Financial and Investment
3901 S. 27th Street Consultant; Chairman of University
Unit #40 of Nebraska Foundation; Director
Lincoln, NE 68502 and Consultant of IBP, Inc. (meat
79 packing and agribusiness), Dakota
City, Nebraska
John H. Conley* Director President, CONLEY SMITH Investment
444 Regency Parkway Advisers, Inc., Omaha, Nebraska;
Omaha, NE Chairman, Lancaster Administrative
68114-3779 Services, Inc., Lincoln, Nebraska;
45 President and Director Conley
Investment Counsel, Omaha,
Nebraska, December 1986-April 1995
Charles W. Hoskins Director Self-Employed Financial Adviser,
63208 Sheridan Ct. Lincoln, Nebraska; Retired Partner
Lincoln, NE 68506 of Deloitte & Touche LLP, Lincoln,
62 Nebraska
Colleen Avery Secretary Vice President, Lancaster
200 Centre Terrace Administrative Services, Inc.,
1225 "L" Street Lincoln, Nebraska, March
Lincoln NE 68508 1996-Present; Investment Operations
37 coordinator, Security Mutual Life
Insurance Company, Lincoln,
Nebraska, June 1984-March 1996
</TABLE>
* Interested director as defined under the Investment Company Act of 1940 by
virtue of affiliation with CONLEY SMITH Investment Advisers, Inc.
Investment Adviser. For a discussion of CSI, the services performed by it and
its fees, see "Management" in the Lancaster Prospectus.
Administrator. For a discussion of Lancaster Administrative Services, Inc. and
its fees and services, see "Management" in the Lancaster Prospectus.
Distributor. For a discussion of SMITH HAYES Financial Services Corporation's
activities as distributor, see "Distribution of Fund Shares" in the Lancaster
Prospectus.
Shares. For a discussion of the significant attributes of Lancaster Fund shares,
see "General Information" in the Lancaster Prospectus.
Purchase and Redemption of Shares. For a discussion concerning purchase
procedures, pricing and redemption of shares of each Lancaster Fund, see
"Distribution of Fund Shares", "Valuation of Shares" and "Redemption of Shares"
in the Lancaster Prospectus.
Dividends, Distributions and Tax Matters. For a discussion of Lancaster's
policies with respect to dividends and distributions, see "Dividends and Taxes"
in the Lancaster Prospectus.
Exchange Privileges. Lancaster does not offer any exchange rights.
Legal Proceedings. Lancaster is not presently involved in any important legal
proceedings.
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Shareholder Inquiries. Shareholder inquiries relating to any Lancaster Fund may
be addressed by writing to SMITH HAYES Financial Services Corporation, 200
Centre Terrace, 1225 "L" Street, Lincoln, Nebraska 68508, or calling toll-free
1-800-279-7437.
Management Discussion of Fund Performance. Management's discussion of the
performance of each Lancaster Fund is located in the Annual Financial Report of
Lancaster, dated June 30, 1998 and the Semi-Annual Financial Report dated
December 31, 1998. Both of these reports are included in your package. Both are
deemed to be legally part of this document.
INFORMATION ABOUT VOTING MATTERS
General Information
You received this document as part of the solicitation of proxies by the Board
of Directors of Lancaster for use at the Special Meeting. The Board of Directors
will solicit proxies primarily by mail. The officers of Lancaster may also
solicit proxies by telephone, facsimile transmission or personal interview. See
"Synopsis" for the number of shares of each Lancaster Fund outstanding and
entitled to vote as of the record date.
You are entitled to one vote for each Lancaster Fund share you own and a
fractional vote for each fractional share you own. If you fill out, sign and
return the proxy in time for the Special Meeting, your shares will be voted
exactly as you tell us. If you only sign and return the proxy, your shares will
be voted FOR the Reorganization proposal and at the direction of the Board of
Directors on any other matters that are brought up at the Special Meeting. Even
if you have sent us your proxy, you may revoke it at any time before it is
voted:
o by mail (addressed to Lancaster's Secretary at 200 Centre
Terrace, 1225 "L" Street, Lincoln, Nebraska 68508)
o in person at the meeting, by executing a subsequent proxy, or by
submitting a notice of revocation to Lancaster
Your written revocation or subsequent proxy should be mailed or delivered to:
Lancaster Funds, c/o Secretary, 200 Centre Terrace, 1225 "L" Street, Lincoln,
Nebraska 68508.
Shareholder and Board Approval
If a majority of outstanding shares of each Lancaster Fund, voting as a class,
vote for the Agreement and Plan of Reorganization it can be implemented. Under
Minnesota law, abstentions are disregarded in determining the "votes cast" on an
issue. Broker "non-votes" (i.e., proxies from brokers or nominees
27
<PAGE>
indicating they have not received instructions from the owner of the shares) are
considered abstentions.
GP Fund shareholders will not vote on the approval of the Plan because their
approval is not necessary for the completion of the Reorganization.
On the Record Date, all of the officers and Directors of Lancaster beneficially
owned, individually and as a group, less than 1% of the shares of each Lancaster
Fund. As of the record date, the following were believed to be the only persons
who owned of record or beneficially 5% or more of the outstanding shares of a
Lancaster Fund:
Name and Address Fund Shares Owned Ownership Percentage
- ---------------------- -------------------- ----------------- ------------------
On the Record Date, all of the officers and Trustees of Great Plains
beneficially owned, individually and as a group, less than 1% of each GP Fund's
shares. No person was known to own 5% or more of any GP Fund's shares on that
date.
Quorum
If a quorum is not present at the Special Meeting, or if a quorum is present at
the Special Meeting but there are not enough favorable votes to approve the
Reorganization, the persons named as proxies may propose adjourning the Special
Meeting to permit more solicitation of proxies. The Special Meeting can be
adjourned by affirmative vote of a majority of all shares represented at the
meeting in person or by proxy. If a quorum is present, the persons named as
proxies will vote those proxies which they are entitled to vote FOR the
Reorganization in favor of such adjournment, and will vote those proxies
required to be voted AGAINST the Reorganization against any adjournment. A
quorum exists if the holders of more than 50% of the aggregate outstanding
shares entitled to vote at the Special Meeting are present in person or by
proxy. If you send us a proxy marked with an abstention, your shares will be
considered to be present at the Meeting for the purpose of determining the
existence of a quorum.
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INFORMATION FILED WITH
THE SECURITIES AND EXCHANGE COMMISSION
This combined Proxy Statement/Prospectus and the related Statement of Additional
Information do not contain all of the information set forth in the registration
statements and the exhibits which Great Plains and Lancaster Fund have filed
with the SEC under the Securities Act of 1933 and the 1940 Act. The SEC file
number for the Lancaster Prospectus and the related Statement of Additional
Information which are legally deemed a part of this document is Registration No.
33-19894. The SEC file number for the Great Plains Prospectus and related
Statement of Additional Information which are legally deemed a part of this
document is Registration No. 333-31137.
Great Plains and Lancaster file annual, quarterly and special reports and other
information with the SEC. They can be inspected and copied at the public
reference facilities of the SEC at 450 Fifth Street, N.W., Washington, D.C.
20549. Copies of such filings may also be available at the following SEC
regional offices: Northwestern Atrium, 500 West Madison Street, Suite 1400,
Chicago, IL 60661-2511; 7 World Trade Center, Suite 1300, New York, NY 10048 and
73 Tremont Street, Suite 600, Boston, MA 02108-3912. Copies of such materials
can also be obtained by mail from the Public Reference Branch, Office of
Consumer Affairs and Information Services, SEC, Washington, D.C. 20549, at
prescribed rates or from the SEC web site, http://www.sec.gov.
OTHER BUSINESS
The Lancaster Board of Directors knows of no other business to be brought before
the Special Meeting. However, if any other matters come before the Special
Meeting, proxies which do not contain contrary instructions will be voted on
such matters as the Board of Directors recommends.
LEGAL MATTERS
Certain legal matters concerning the issuance of shares in the Reorganization
will be passed upon for Great Plains by Federated Administrative Services,
Federated Investors Tower, Pittsburgh, Pennsylvania 15222. Certain tax matters
will be passed upon for Lancaster by Cline, Williams, Wright, Johnson &
Oldfather, 1900 U.S. Bank Building, 233 South 13th Street, Lincoln, Nebraska
68508.
29
<PAGE>
SHAREHOLDER INQUIRIES
Shareholder inquiries may be addressed to Lancaster Funds in writing at the
address on the cover page of this combined Proxy Statement/Prospectus or by
telephoning 1-800-279-7437.
* * *
SHAREHOLDERS WHO DO NOT EXPECT TO BE PRESENT AT THE MEETING ARE REQUESTED TO
DATE AND SIGN THE ENCLOSED PROXY AND RETURN IT IN THE ENCLOSED ENVELOPE. NO
POSTAGE IS REQUIRED IF MAILED IN THE UNITED STATES.
30
<PAGE>
EXHIBIT A
AGREEMENT AND PLAN OF REORGANIZATION
THIS AGREEMENT made as of the 21st day of April 1999, is made by and between
SMITH HAYES Trust, Inc., a Minnesota corporation doing business as Lancaster
Funds ("Lancaster"), and Great Plains Funds, a Massachusetts business trust
("Great Plains").
WITNESSETH:
WHEREAS, the Board of Directors of Lancaster, and the Board of Trustees of Great
Plains, each an open-end management investment company, deem it advisable that
Great Plains acquire certain portfolios (the "Acquired Funds" hereinafter
identified) of Lancaster in exchange for the assumption by Great Plains of all
of the Stated Liabilities (as hereinafter defined) of the Acquired Funds and the
issuance of shares of Great Plains which are thereafter to be distributed by
Lancaster in complete liquidation and termination of the Acquired Funds and in
exchange for all of the outstanding shares of the Acquired Funds, with the
intent that the transactions described herein shall qualify as a tax-free
reorganization under Section 368(a)(1)(C) of the Internal Revenue Code of 1986
(the "Reorganization"); and
WHEREAS, the portfolios of Lancaster to be acquired pursuant to this Agreement
are Lancaster Capital Builder Fund ("Capital Builder"), Lancaster Convertible
Fund ("Convertible"), Lancaster Crestone Small Cap Fund ("Small Cap") and
Lancaster Government Quality Bond Fund ("Government"), each an "Acquired Fund"
and, collectively, the "Acquired Funds"; and the portfolios of Great Plains
which shall acquire the Acquired Funds are: Great Plains Equity Fund ("Great
Plains Equity") which shall acquire Capital Builder and Convertible; Great
Plains Premier Fund ("Great Plains Premier") which shall acquire Small Cap; and
Great Plains Intermediate Bond Fund ("Great Plains Bond") which shall acquire
Government, each such portfolio of Great Plains to be referred to herein as an
"Acquiring Fund" and, collectively, the "Acquiring Funds."
NOW THEREFORE, in consideration of the mutual promises herein contained, each of
the parties hereto represents and warrants to, and agrees with, the other party
as follows:
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1. Great Plains hereby represents, warrants and covenants to Lancaster that:
(1) Great Plains is a business trust with transferable shares duly
organized and validly existing under the laws of Massachusetts, and
has full corporate power to own its properties and assets and to carry
on its business as such business is now being conducted.
(2) The statement of assets and liabilities of each Acquiring Fund, as of
August 31, 1998, and the related statements of operations and changes
in net assets for the fiscal year ended August 31, 1998, all as
audited by Deloitte & Touche LLP, have been prepared in accordance
with generally accepted accounting principles applied on a consistent
basis. Each such statement of assets and liabilities fairly presents
the financial position and net assets of such Acquiring Fund as of
such date and each such statement of operations and changes in net
assets fairly present the results of its operations for the period
covered thereby;
(3) There are no claims, actions, suits or proceedings pending or, to its
knowledge, threatened against or affecting Great Plains or its
properties or business or its right to issue and sell shares, or which
would prevent or hinder consummation of the transactions contemplated
hereby, and it is not charged with or, to Great Plains' knowledge,
threatened with any charge or investigation of, or any violation of
any provision of any federal, state or local law or any administrative
ruling or regulation relating to any aspect of its business or the
issuance or sale of its shares;
(4) Great Plains is not a party to or subject to any judgment or decree or
order entered in any suit or proceeding brought by any governmental
agency or by any other person enjoining it in respect of, or the
effect of which is to prohibit, any business practice or the
acquisition of any property or the conduct of business by it or the
issuance or sale of its shares in any area;
2
<PAGE>
(5) Each Acquiring Fund has filed all tax returns required to be filed,
has no liability for any unpaid taxes and has made a proper election
to be treated as a regulated investment company under Subchapter M of
the Internal Revenue Code of 1986 (the "Code") for each of its taxable
years. No Acquiring Fund has committed any action or failed to perform
any necessary action that would render invalid its election to be
treated as a regulated investment company for any of its taxable
years;
(6) The authorization, execution and delivery of this Agreement on behalf
of Great Plains does not, and the consummation of the transactions
contemplated hereby will not violate, or conflict with any provision
of Great Plains' Declaration of Trust or By-Laws, or any provision of,
or result in the acceleration of any obligation under, any mortgage,
lien, lease, agreement, instrument, order, arbitration award, judgment
or decree to which it is party or by which it or any of its assets is
bound, or violate or conflict with any other material contractual or
statutory restriction of any kind or character to which it is subject;
(7) This Agreement has been duly authorized, executed, and delivered by
Great Plains and constitutes a valid and binding agreement of Great
Plains, and, on or prior to the Closing Date (as herein defined), all
governmental and other approvals required for Great Plains to carry
out the transactions contemplated hereunder will have been obtained.
Great Plains will comply with all applicable laws and regulations in
carrying out the transactions contemplated hereunder, including,
without limitation, the Investment Company Act of 1940, as amended
(the "1940 Act");
(8) Great Plains is registered under the 1940 Act as an open-end
management investment company. Great Plains is currently in compliance
with the 1940 Act and the rules of the Securities and Exchange
Commission (the "Commission") promulgated thereunder in all material
respects.
3
<PAGE>
(9) On the Closing Date, each Acquiring Fund will own its assets free and
clear of all liens, claims, charges, options and encumbrances except
for items arising in the ordinary course of business which are
deducted in the calculation of net asset value;
(10) On the Closing Date the shares of each of the Acquiring Funds to be
delivered to Lancaster hereunder shall have been registered under the
Securities Act of 1933, as amended (the "1933 Act") and duly
authorized, and, when issued and delivered pursuant to this Agreement,
will be validly issued, fully paid and nonassessable; and Great Plains
will comply with all applicable laws in connection with the issuance
of such shares and shall not be subject to a stop-order of the
Commission in connection therewith; and
(11) On the Closing Date, the shares of the Acquiring Funds to be delivered
to Lancaster hereunder shall have been registered with the appropriate
securities administrator or agency of each state under whose
securities law such registration is required.
2. Lancaster hereby represents, warrants and covenants to Great Plains that:
(1) Lancaster is a corporation, with transferable shares, duly organized
and validly existing under the laws of the State of Minnesota, and has
full corporate power to own its properties and assets and to carry on
its business as such business is now being conducted.
4
<PAGE>
(2) The statement of assets and liabilities as of June 30, 1998, and the
related statements of operations and changes in net assets for the
fiscal year ended June 30, 1998 of each Acquired Fund, all as audited
by Deloitte & Touche LLP, have been prepared in accordance with
generally accepted accounting principles applied on a consistent
basis. Each such statement of assets and liabilities fairly presents
the financial position and net assets of such Acquired Fund as of such
date and such statements of operations and changes in net assets
fairly present the results of its operations for the period covered
thereby. All books, records and accounts of the Acquired Funds have
been maintained in accordance with applicable legal requirements and
generally accepted accounting principles applicable to investment
companies;
(3) There are no claims, actions, suits or proceedings pending or, to its
knowledge, threatened against or affecting Lancaster or its properties
or business or its right to issue and sell shares, or which would
prevent or hinder consummation of the transactions contemplated
hereby, and it is not charged with or, to Lancaster's knowledge,
threatened with any charge or investigation of, or any violation of
any provision of any federal, state or local law or any administrative
ruling or regulation relating to any aspect of its business or the
issuance or sale of its shares;
(4) Lancaster is not a party to or subject to any judgment or decree or
order entered in any suit or proceeding brought by any governmental
agency or by any other person enjoining it in respect of, or the
effect of which is to prohibit, any business practice or the
acquisition of any property or the conduct of business by it or the
issuance or sale of its shares in any area;
(5) Each Acquired Fund has filed all tax returns required to be filed, has
no liability for any unpaid taxes and has made a proper election to be
treated as a regulated investment company under Subchapter M of the
Code for each of its taxable years. No Acquired Fund has committed any
action or failed to perform any necessary action that would render
invalid its election to be treated as a regulated investment company
for any of its taxable years;
5
<PAGE>
(6) The authorization, execution and delivery of this Agreement on behalf
of Lancaster does not, and the consummation of the transactions
contemplated hereby, subject to the approval of shareholders of the
Acquired Funds as referred to in paragraph 11, will not, violate, or
conflict with any provision of Lancaster's Articles of Incorporation
or By-Laws, or any provision of, or result in the acceleration of any
obligation under, any mortgage, lien, lease, agreement, instrument,
order, arbitration award, judgment or decree to which it is a party or
by which it or any of its assets is bound, or violate or conflict with
any other material contractual or statutory restriction of any kind or
character to which it is subject;
(7) This Agreement has been duly authorized, executed, and delivered by
Lancaster and constitutes a valid and binding agreement of Lancaster,
and, on or prior to the Closing Date (as herein defined), all
governmental and other approvals required for Lancaster to carry out
the transactions contemplated hereunder will have been obtained.
Lancaster will comply with all applicable laws and regulations in
carrying out the transactions contemplated hereunder, including,
without limitation, the Investment Company Act of 1949, as amended
(the "1940 Act");
(8) On the Closing Date, Lancaster and each Acquired Fund will own its
assets free and clear of all liens, claims, charges, options and
encumbrances and, except for the various agreements listed in Part C
of Lancaster's current Form N-1A Registration Statement under the 1933
Act and 1940 Act, there will be no material contracts or agreements
(other than this Agreement) outstanding to which Lancaster is a party
or to which it is subject;
(9) On the Closing Date, subject to the approval of shareholders of the
Acquired Funds as referred to in paragraph 11, Lancaster will have
full right, power and authority to sell, assign and deliver the assets
to be sold, assigned, transferred and delivered to Great Plains
hereunder, and upon delivery and payment for such assets, Great Plains
will acquire good and marketable title thereto free and clear of all
liens, claims, charges, options and encumbrances;
6
<PAGE>
(10) Lancaster will declare to shareholders of record of each Acquired Fund
immediately prior to the Closing Date a dividend or dividends which,
together with all previous such dividends, shall have the effect of
distributing to the shareholders all of the investment company taxable
income of each Acquired Fund (computed without regard to any deduction
for dividends paid) and all of the net realized capital gains, if any,
through the close of business on the business day immediately
preceding the Closing Date; and on the Closing Date no Acquired Fund
will engage in any portfolio transaction other than as provided for in
this Agreement; and
(11) Lancaster will, from time to time, as and when requested by Great
Plains, execute and deliver or cause to be executed and delivered, all
such assignments and other instruments, and will take and cause to be
taken such further action, as Great Plains may deem necessary or
desirable in order to vest in and confirm to Great Plains, title to
and possession of all the assets of Lancaster to be sold, assigned,
transferred and delivered hereunder and otherwise to carry out the
intent and purpose of this Agreement.
3. Based on the respective representations and warranties, subject to the
terms and conditions contained herein, Lancaster agrees to transfer to
Great Plains and Great Plains agrees to acquire from Lancaster, all the
assets of each Acquired Fund on the Closing Date and to assume from
Lancaster all of the Stated Liabilities (as defined in Section 7) of each
Acquired Fund in exchange for the issuance of the number of shares of the
Acquiring Funds provided in Section 4 which will be subsequently
distributed pro rata to the shareholders of the Acquired Funds in complete
liquidation and termination of the Acquired Funds and in exchange for all
of the outstanding shares of the Acquired Funds, as provided in Section 6.
Lancaster shall not issue, sell or transfer any of its shares on or after
the Valuation Date (hereinafter defined), and only redemption requests
received by Lancaster in proper form prior to the Valuation Date shall be
fulfilled by Lancaster. Redemption requests received by Lancaster on or
after the Valuation Date shall be treated as requests for redemption of
those shares of the Acquiring Funds allocable to the shareholder in
question as provided in Section 6 of this Agreement.
4. On the Closing Date, Great Plains will issue to Lancaster that number of
full and fractional shares of the respective Acquiring Funds referred to in
(a) through (d) below, as follows:
7
<PAGE>
(1) Great Plains will issue that number of shares of Great Plains Equity,
taken at their net asset value, having an aggregate net asset value
equal to the aggregate value of the net assets of Lancaster that are
allocable to Capital Builder transferred to Great Plains Equity on the
Closing Date;
(2) Great Plains will issue that number of shares of Great Plains Equity,
taken at their net asset value, having an aggregate net asset value
equal to the aggregate value of the net assets of Lancaster that are
allocable to Convertible transferred to Great Plains Equity on the
Closing Date;
(3) Great Plains will issue that number of shares of Great Plains Premier,
taken at their net asset value, having an aggregate net asset value
equal to the aggregate value of the net assets of Lancaster that are
allocable to Small Cap transferred to Great Plains Premier on the
Closing Date; and
(4) Great Plains will issue that number of shares of Great Plains
Intermediate Bond, taken at their net asset value, having an aggregate
net asset value equal to the aggregate value of the net assets of
Lancaster that are allocable to Government transferred to Great Plains
Intermediate Bond on the Closing Date.
(5) For purposes of this Section 4, the aggregate value of the net assets
of each Acquired Fund and the net asset value each Acquiring Fund
shall be determined in accordance with the then current Prospectus of
Great Plains as of the close of trading on the New York Stock Exchange
on the business day immediately preceding the Closing Date, unless the
parties agree to determine such values as of another date (the
"Valuation Date").
8
<PAGE>
5. The closing of the transaction contemplated in this Agreement (the
"Closing") shall be held at the offices of First Commerce Investors, 610
NBC Center, 1248 "O" Street, Lincoln, Nebraska 68508 (or at such other
place as the parties hereto may agree) at 9:00 a.m. Central Standard Time
on May 24, 1999, or on such earlier or later date as the parties hereto may
mutually agree. The date on which the Closing is to be held as provided in
this Agreement shall be known as the "Closing Date".
In the event that on the proposed Valuation Date or Closing Date (a)the New
York Stock Exchange is closed for other than customary week-end and holiday
closings or (b) trading on said Exchange is restricted or (c) an emergency
exists as a result of which it is not reasonably practicable for either the
Acquiring Funds or the Acquired Funds to fairly determine the value of
their respective assets, the Closing shall be postponed until the first
business day after the day on which trading shall have been fully resumed.
6. As soon as practicable after the Closing Date, Lancaster shall (a)
distribute on a pro rata basis to each shareholder of record of the
Acquired Funds at the close of business on the Valuation Date the shares of
the appropriate Acquiring Fund received by Lancaster at the Closing in
exchange for each such shareholder's shares of an Acquired Fund; (b) cancel
all shares of each Acquired Fund; and (c) liquidate and dissolve the
Acquired Funds in accordance with applicable law and its Articles of
Incorporation.
For purposes of the distribution of shares of the Acquiring Funds to
shareholders of the Acquired Funds, Great Plains shall credit on the books
of each Acquiring Fund an appropriate number of shares of such Acquiring
Fund to the account of each shareholder of the corresponding Acquired Fund.
No certificates will be issued for shares of the Acquiring Funds.
9
<PAGE>
7. On the Closing Date, the chief financial officer of Lancaster shall certify
as true and correct and deliver to Great Plains a statement of assets and
liabilities for each Acquired Fund, showing separately (a) each asset of
that Acquired Fund and the date of purchase, the federal income tax basis
(on an identified cost basis) and the value on the Valuation Date for each
such asset, (b) stated each liability of that Acquired Fund, including the
dollar amount of the liability, the party to whom the liability is owed and
the nature of the liability, (c) the number of shares of such Acquired Fund
outstanding at the close of business on the Valuation Date and (d) the net
asset value per share of such Acquired Fund as of that time. Each such
statement of assets and liabilities shall be certified by the chief
financial officer as true and correct and shall be delivered to Great
Plains. For purposes of this Agreement, the "Stated Liabilities" of each
Acquired Fund shall be only those liabilities specifically listed on such
statement of assets and liabilities, and the Acquiring Fund shall assume
only those Stated Liabilities of an Acquired Fund whose assets it acquires
and, as to any Stated Liability, only in the maximum amount shown on such
statements as the amount of such liability. Neither Great Plains nor any
Acquiring Fund shall assume or have any liability for any actual or
contingent liability or obligation of any Acquired Fund except as and to
the extent set forth in the preceding sentence.
8. All portfolio securities of each Acquired Fund shall be delivered by
Lancaster's custodian on the Closing Date to Great Plains or its custodian,
either endorsed in proper form for transfer in such condition as to
constitute good delivery thereof in accordance with the practice of brokers
or, if such securities are held in a securities depository within the
meaning of Rule 17f-4 under the 1940 Act, transferred to an account in the
name of Great Plains or its custodian with said depository. Such delivery
shall be "free" delivery. All cash of any Acquired Fund to be delivered
pursuant to this Agreement shall be wire transferred from Lancaster's
account at its custodian to Great Plains' custodian, to the specific
account of the Acquiring Fund issuing shares to that Acquired Fund pursuant
to this Agreement. If on the Closing Date Lancaster is unable to make good
delivery pursuant to this Section 8 to Great Plains' custodian of any of
Lancaster's portfolio securities because such securities have not yet been
delivered to Lancaster's custodian by its broker or by the transfer agent
for such securities, then the delivery requirement of this Section 8 with
respect to such securities shall be waived, and Lancaster shall deliver to
Great Plains' custodian on or by said Closing Date, with respect to said
undelivered securities, executed copies of an agreement of assignment in a
form satisfactory to Great Plains, and a due bill or due bills in form and
substance satisfactory to the custodian, together with such other documents
including brokers' confirmations, as may be reasonably required by Great
Plains.
10
<PAGE>
9. The obligations of Great Plains under this Agreement shall be subject to
receipt by Great Plains on or prior to the Closing Date of:
(1) Copies of the resolutions adopted by the Board of Directors of
Lancaster and the shareholders of each Acquired Fund authorizing the
execution and performance of this Agreement by Lancaster and the
transactions contemplated hereunder, certified by the Secretary or
Assistant Secretary of Lancaster;
(2) A certificate of the Secretary or Assistant Secretary of Lancaster as
to the signatures and incumbency of its officers who executed this
Agreement on behalf of Lancaster and any other documents delivered in
connection with the transactions contemplated thereby on behalf of
Lancaster;
(3) A certificate of an appropriate officer of Lancaster as to the
fulfillment of all agreements and conditions on its part to be
fulfilled hereunder at or prior to the Closing Date and to the effect
that the representations and warranties of Lancaster are true and
correct in all material respects at and as of the Closing Date as if
made at and as of such date;
(4) Such other documents as Great Plains may reasonably request to show
fulfillment of the purposes and conditions of this Agreement; and
11
<PAGE>
(5) An opinion of Cline, Williams, Wright, Johnson & Oldfather in form
reasonably satisfactory to Great Plains and dated as of the Closing
Date of the Reorganization, substantially to the effect that (i)
Lancaster is a Minnesota corporation duly established and validly
existing under the laws of the State of Minnesota; (ii) the shares of
the Acquired Funds presently outstanding are duly authorized and are
validly issued, fully paid and non-assessable; (iii) this Agreement
has been duly authorized, executed and delivered by Lancaster, and
represents a legal, valid and binding contract enforceable in
accordance with its terms, subject as to enforcement to bankruptcy,
insolvency, reorganization, moratorium or other similar laws of
general application relating to or affecting creditors' rights
generally and to the application of general principles of equity; and
(iv) the execution and delivery of this Agreement did not, and the
consummation of the transactions contemplated by this Agreement will
not, violate the Charter or Bylaws of Lancaster or any material
contract known to such counsel to which Lancaster is a party or by
which it is bound.
10. The obligations of Lancaster under this Agreement shall be subject to
receipt by Lancaster on or prior to the Closing Date of:
(1) Copies of the resolutions adopted by the Board of Directors of Great
Plains authorizing the execution and performance of this Agreement and
the transactions contemplated hereunder, certified by the Secretary or
Assistant Secretary of Great Plains;
(2) A certificate of the Secretary or Assistant Secretary of Great Plains
as to the signatures and incumbency of its officers who executed this
Agreement on behalf of Great Plains and any other documents delivered
in connection with the transactions contemplated thereby on behalf of
Great Plains;
(3) A certificate of an appropriate officer of Great Plains as to the
fulfillment of all agreements and conditions on its part to be
fulfilled hereunder at or prior to the Closing Date and to the effect
that the representations and warranties of Great Plains are true and
correct in all material respects at and as of the Closing Date as if
made at and as of such date;
(4) Such other documents as Lancaster may reasonably request to show
fulfillment of the purposes and conditions of this Agreement;
12
<PAGE>
(5) An opinion of Bell, Boyd & Lloyd in form reasonably satisfactory to
Lancaster and dated as of the Closing Date of the Reorganization,
substantially to the effect that (i) Great Plains is a business trust
duly established and validly existing under the laws of the State of
Massachusetts; (ii)the shares of the Acquiring Funds to be delivered
to Lancaster as provided for by this Agreement are duly authorized and
upon delivery will be validly issued, fully paid and non-assessable by
Great Plains; (iii) this Agreement has been duly authorized, executed
and delivered by Great Plains, and represents a legal, valid and
binding contract, enforceable in accordance with its terms, subject as
to enforcement to bankruptcy, insolvency, reorganization, moratorium
or other similar laws of general application relating to or affecting
creditors' rights generally and to the application of general
principles of equity; (iv) the execution and delivery of this
Agreement did not, and the consummation of the transactions
contemplated by this Agreement will not, violate the Declaration of
Trust or By-Laws of Great Plains or any material contract known to
such counsel to which Great Plains is a party or by which it is bound
and (v) no consent, approval, authorization or order of any court or
governmental authority is required for the consummation by Great
Plains of the transactions contemplated by this Agreement, except such
as have been obtained under the 1933 Act, the 1940 Act, the rules and
regulations under those Acts and such as may be required by state
securities laws or such as may be required subsequent to the Closing
of the Reorganization.
13
<PAGE>
(6) An opinion of Cline, Williams, Wright, Johnson & Oldfather addressed
to Great Plains and Lancaster in form reasonably satisfactory to them,
and dated as of the Closing Date of the Reorganization, substantially
to the effect that, for federal income tax purposes (i) the transfer
by each Acquired Fund of all of its assets to the corresponding
Acquiring Fund in exchange for shares of the corresponding Acquiring
Fund, and the distribution of such shares to the shareholders of the
Acquired Fund, as provided in this Agreement, will constitute a
reorganization within the meaning of Section 368(a)(1)(C) of the Code;
(ii) no income, gain or loss will be recognized by the Acquired Funds
as a result of such transactions; (iii) no income, gain or loss will
be recognized by the Acquiring Funds as a result of such transactions;
(iv) no income, gain or loss will be recognized by the shareholders of
the Acquired Funds on the distribution to them by the Acquired Funds
of shares of the corresponding Acquiring Funds in exchange for their
shares of the Acquired Funds (but shareholders of an Acquired Fund
subject to taxation will recognize income upon receipt of any net
investment income or net capital gains of such Acquired Fund which are
distributed by such Acquired Fund prior to the Closing Date of the
Reorganization); (v) the tax basis of the Acquiring Fund shares
received by each shareholder of an Acquired Fund will be the same as
the tax basis of the shareholder's Acquired Fund shares exchanged
therefor; (vi) the tax basis of the Acquired Fund assets received by
each Acquiring Fund will be the same as the basis of such Fund's
assets in the hands of the corresponding Acquired Fund immediately
prior to the transactions; (vii) a shareholder's holding period for
Acquiring Fund shares will be determined by including the period for
which the shareholder held the shares of the Acquired Fund exchanged
therefor, provided that the shareholder held such shares of the
Acquired Fund as a capital asset at the Closing of the Reorganization;
(viii) the holding period of each Acquiring Fund with respect to the
Acquired Fund assets will include the period for which such assets
were held by the corresponding Acquired Fund provided that the
Acquired Fund held such assets as capital assets; and (ix) each
Acquiring Fund will succeed to and take into account the earnings and
profits, or deficit in earnings and profits, of the corresponding
Acquired Fund as of the Closing of the Reorganization.
11. The obligations of the parties under this Agreement shall be subject to:
(1) Any required approval, at a meeting duly called for the purpose, of
the holders of the outstanding shares of each Acquired Fund, of this
Agreement and the transactions contemplated hereunder.
14
<PAGE>
(2) The right of either Lancaster or Great Plains to abandon and terminate
this Agreement prior to the Closing Date, upon 48 hours written notice
delivered in person or by facsimile, if it believes that the
consummation of the transactions contemplated hereunder would not be
in the best interests of its shareholders.
12. Neither Great Plains nor Lancaster will be responsible for payment of any
expenses of the other, including out-of-pocket fees and expenses incurred
in connection with the transactions contemplated under this Agreement,
accountants' fees, legal fees, registration fees, filing fees, printing
expenses, transfer taxes (if any) and the fees of banks, custodians and
transfer agents.
13. This Agreement may be amended by an instrument executed by the duly
authorized officers of Lancaster and Great Plains at any time, except that
after approval by the shareholders of the Acquired Funds, no amendment may
be made with respect to the Agreement which, in the opinion of the Board of
Directors of Lancaster, materially adversely affects the interests of the
shareholders of Lancaster. At any time Lancaster or Great Plains may by
written instrument signed by it (i) waive any inaccuracies in the
representations and warranties made to it by the other contained herein and
(ii) waive compliance with any of the covenants or conditions made for its
benefit contained herein.
14. In addition to the right to terminate this Agreement described in paragraph
11, this Agreement may be terminated and the plan described in the
Agreement abandoned at any time prior to the Closing Date, whether before
or after action thereon by the shareholders of the Acquired Funds and
notwithstanding favorable action by such shareholders, by mutual consent of
the Board of Directors of Lancaster and the Board of Trustees of Great
Plains. This Agreement may also be terminated by action of the Board of
Directors of Lancaster or the Board of Trustees of Great Plains prior to
the Closing Date, if:
(1) The Closing described in this Agreement shall not have taken place by
June 30, 1999 or such other date agreed to in writing by the parties
(hereinafter called the "Final Date"); or
15
<PAGE>
(2) Either Lancaster or Great Plains shall, at the Final Date, have failed
to comply with any of its agreements contained herein; or
(3) Prior to the Final Date any one or more of the conditions to the
obligations of Great Plains or Lancaster contained in this Agreement
shall not be fulfilled to the reasonable satisfaction of Great Plains
and its counsel or Lancaster and its counsel, as the case may be, or
it shall become evident to Great Plains or Lancaster that any of such
conditions are incapable of being fulfilled.
15. This Agreement shall bind and inure to the benefit of the parties hereto
and is not intended to confer upon any other person any rights or remedies
hereunder.
16. The parties hereto represent and warrant that they have not employed any
broker, finder or intermediary in connection with this transaction who
might be entitled to a finder's fee or other similar fee or commission.
17. This Agreement constitutes the entire and exclusive agreement of the
Parties concerning the Reorganization and supersedes all previous
communications, representations or agreements, either oral or written,
between them.
18. This Agreement shall be governed by and construed in accordance with the
laws of the State of Nebraska.
19. This Agreement may be executed in one or more counterparts, all of which
shall be considered one and the same agreement, and shall become effective
when one or more of the counterparts has been signed by all parties hereto.
16
<PAGE>
20. Lancaster shall indemnify, defend and hold harmless Great Plains, its
officers, directors, employees and agents against all losses, claims,
demands, liabilities and expenses, including reasonable legal and other
expenses incurred in defending claims or liabilities, whether or not
resulting in any liability to Great Plains, its officers, directors,
employees or agents, arising out of or based on (i) any breach by Lancaster
of any of its representations, warranties, covenants or agreements set
forth in this Agreement, or (ii) any untrue statement or alleged untrue
statement of a material fact provided by Lancaster and contained in any
proxy statement for Lancaster, as filed with the Commission or any
amendment or supplement thereto, or any notification prepared by or on
behalf of Lancaster and filed with any state regulatory agency, or in any
information provided by Lancaster included in any proxy statement or
registration statement filed by Great Plains with the Securities and
Exchange Commission or any amendment or supplement thereto; or which shall
arise out of or be based upon any omission or alleged omission to state
therein a material fact required to be stated in any such proxy statement,
registration statement or application necessary to make the statements
therein not misleading. This indemnity provision shall survive the
termination of this Agreement.
21. Great Plains shall indemnify, defend and hold harmless Lancaster, its
officers, trustees, employees and agents against all losses, claims,
demands, liabilities and expenses, including reasonable legal and other
expenses incurred in defending claims or liabilities, whether or not
resulting in any liability to Lancaster, its officers, trustees, employees
or agents, arising out of or based on (i) any breach by Great Plains of any
of its representations, warranties, covenants or agreements set forth in
this Agreement, or (ii) any untrue statement or alleged untrue statement of
a material fact contained in any registration statement on Form N-1A or
Form N-14 for Great Plains, as filed with the Securities and Exchange
Commission or any amendment or supplement thereto, or any notification
prepared by or on behalf of Great Plains and submitted to any state
regulatory agency regarding the sale of shares of Great Plains under the
securities laws thereof; or which shall arise out of or be based upon any
omission or alleged omission to state therein a material fact required to
be stated in any such registration statement or application necessary to
make the statements therein not misleading; provided, however, Great Plains
shall not be required to indemnify Lancaster, its officers, directors,
employees and agents against any loss, claim, demand, liability or expense
arising out of any information provided by Lancaster included in any
registration statement filed by Great Plains with the Securities and
Exchange Commission or any amendment or supplement thereto. This indemnity
provision shall survive the termination of this Agreement.
17
<PAGE>
22. The execution of this Agreement has been authorized by the Board of
Directors of Lancaster and by the Board of Trustees of Great Plains.
The Declaration of Trust of Great Plains Funds, a copy of which, together with
all amendments thereto, is on file in the Office of the Secretary of the
Commonwealth of Massachusetts, provides (i) that the name Great Plains Funds
refers to the trustees under the Declaration of Trust collectively as trustees
and not as individuals or personally, (ii) that no shareholder shall be subject
to any personal liability whatsoever to any person in connection with trust
property or the acts, obligations or affairs of the trust, and (iii) that no
trustee, officer, employee or agent of the trust shall be subject to any
personal liability whatsoever to any person, other than to the trust or its
shareholders, in connection with trust property or the affairs of the trust,
save only that arising from bad faith, willful misfeasance, gross negligence or
reckless disregard of his duties with respect to such person; and all such
persons shall look solely to the trust property for satisfaction of claims of
any nature arising in connection with the affairs of the trust.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
and attested by their officers thereunto duly authorized, as of the date first
written above.
SMITH HAYES TRUST, INC.
Attest
By:_________________________ By:_________________________
Title: Secretary Title: President
GREAT PLAINS FUNDS
Attest
By:_________________________ By:_________________________
Title: Vice President Title: Vice President
18
<PAGE>
TABLE OF CONTENTS
SYNOPSIS.....................................................................
RISK FACTORS.................................................................
PROPOSAL: AGREEMENT AND PLAN OF REORGANIZATION...............................
GREAT PLAINS FUNDS...........................................................
LANCASTER FUNDS..............................................................
INFORMATION ABOUT VOTING MATTERS.............................................
INFORMATION FILED WITH THE SECURITIES
AND EXCHANGE COMMISSION....................................................
OTHER BUSINESS...............................................................
LEGAL MATTERS................................................................
SHAREHOLDER INQUIRIES........................................................
EXHIBIT A - AGREEMENT AND PLAN OF REORGANIZATION.............................
----------------------------------------
You should rely only on the information contained in this document or
information to which we have referred you. We have not authorized anyone to give
you information that is different.
24
<PAGE>
GREAT PLAINS FUNDS
Statement of Additional Information
General Information
This Statement of Additional Information contains or incorporates
information which may be of interest to investors but which is not included in
the combined Proxy Statement/Prospectus (the "Prospectus") dated May ___, 1999,
relating to the reorganization involving certain Lancaster Funds (the "Lancaster
Funds"), series of the SMITH HAYES Trust, Inc. and certain series of Great
Plains Funds (the "GP Funds"). The Statement of Additional Information for the
Lancaster Funds dated September 29, 1998 and the Statement of Additional
Information for the GP Funds dated October 31, 1998 have been filed with the
Securities and Exchange Commission and are deemed to be legally a part of this
document. This Statement is not a Prospectus and is authorized for distribution
only when it accompanies or follows delivery of the Prospectus. This Statement
of Additional Information should be read in conjunction with the Prospectus. A
copy of the May ___, 1999 Proxy Statement/Prospectus may be obtained, without
charge, by writing Lancaster Funds, 200 Centre Terrace, 1225 "L" Street,
Lincoln, Nebraska 68508 or by calling 1-800-279-7437.
The date of this Statement of Additional Information is May ___, 1999.
Table of Contents
General Information........................................................1
<PAGE>
PART C -- OTHER INFORMATION
Item 15. Indemnification
Indemnification is provided to Officers and Trustees of the Registrant
pursuant to Section 2 of Article XI of Registrant's Declaration of Trust. The
Investment Advisory Contract between the Registrant and First Commerce Investors
("Adviser") provides that, in the absence of willful misfeasance, bad faith,
gross negligence, or reckless disregard of the obligations or duties under the
Investment Advisory Contract on the part of Adviser, Adviser shall not be liable
to the Registrant or to any shareholder for any act or omission in the course of
or connected in any way with rendering services or for any losses that may be
sustained in the purchase, holding, or sale of any security. Registrant's
Trustees and Officers are covered by an Investment Trust Errors and Omissions
Policy.
Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to Trustees, Officers, and controlling persons of the
Registrant by the Registrant pursuant to the Declaration of Trust or otherwise,
the Registrant is aware that in the opinion of the Securities and Exchange
Commission, such indemnification is against public policy as expressed in the
Act and, therefore, is unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
Registrant of expenses incurred or paid by Trustees, Officers, or controlling
persons of the Registrant in connection with the successful defense of any act,
suit, or proceeding) is asserted by such Trustees, Officers, or controlling
persons in connection with the shares being registered, the Registrant will,
unless in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the Act and
will be governed by the final adjudication of such issues.
Insofar as indemnification for liabilities may be permitted pursuant to
Section 17 of the Investment Company Act of 1940 for Trustees, Officers, and
controlling persons of the Registrant by the Registrant pursuant to the
Declaration of Trust or otherwise, the Registrant is aware of the position of
the Securities and Exchange Commission as set forth in Investment Company Act
Release No. IC-11330. Therefore, the Registrant undertakes that in addition to
complying with the applicable provisions of the Declaration of Trust or
otherwise, in the absence of a final decision on the merits by a court or other
body before which the proceeding was brought, that an indemnification payment
will not be made unless in the absence of such a decision, a reasonable
determination based upon factual review has been made (i) by a majority vote of
quorum of non-party Trustees who are not interested persons of the Registrant or
(ii) by independent legal counsel in a written opinion that the indemnitee was
not liable for an act of willful misfeasance, bad faith, gross negligence, or
reckless disregard of duties. The Registrant further undertakes that advancement
of expenses incurred in the defense of a proceeding (upon undertaking for
repayment unless it is ultimately determined that indemnification is
appropriate) against an Officer, Trustee, or controlling person of the
Registrant will not be made absent the fulfillment of at least one of the
following conditions: (i) the indemnitee provides security for his undertaking;
(ii) the Registrant is insured against losses arising by reason of any lawful
advances; or (iii) a majority of a quorum of disinterested non-party Trustees or
independent legal counsel in a written opinion makes a factual determination
that there is reason to believe the indemnitee will be entitled to
indemnification.
<PAGE>
Item 16. Exhibits
1. Declaration of Trust of Registrant./1/
2. By-Laws of Registrant./1/
3. Not applicable.
4. Agreement and Plan of Reorganization between Great Plains Funds and
Lancaster Funds dated April 21, 1999. (See Exhibit A to Proxy
Statement/Prospectus) /6/
5. Not applicable.
6(a). Conformed Copy of Investment Advisory Contract of the Registrant./2/
6(b)-(e).Conformed Copy of Exhibits A through E to the Investment Advisory
Contract./2/
6(f). Conformed Copy of Sub-Advisory Contract./3/
7(a). Conformed Copy of Distributor's Contract of the Registrant./3/
7(b). Conformed Copy of Exhibit A to the Distributor's Contract./3/
7(c). Conformed Copy of Mutual Fund Sales and Service Agreement./3/
8. Not applicable.
9(a). Conformed Copy of Custodian Contract of the Registrant./4/
9(b). Schedule of Compensation./4/
9(c). Conformed Copy of Subcustody Agreement./5/
10(a). Conformed Copy of Distribution Plan of Registrant./3/
10(b). Conformed Copy of Exhibit A to the Distribution Plan./3/
11. Opinion of Federated Administrative Services dated April 21, 1999./6/
12. Opinion of Cline, Williams, Wright, Johnson & Oldfather dated April 14,
1999. /6/
13. Conformed Copy of Agreement for Fund Accounting Services, Administrative
Services, and Transfer Agency Services of the Registrant./3/
14(a). Consent of Deloitte & Touche LLP for Lancaster Funds./6/
14(b). Consent of Deloitte & Touche LLP for Great Plains Funds./6/
15. [None.]
16. Powers of Attorney for Messrs. Gonzales, Hansen, Howard, Massengale,
Mitchell, and Ms. Broderick, Trustees, authorizing, among others, Gail
Cagney to execute the Registration Statement./6/
17. Form of Proxy Card. /6/
/1/ Incorporated by reference to the Registrant's initial registration
statement on Form N-1A, filed July 11, 1997, No. 333-31137 (the
"Registration Statement").
/2/ Incorporated by reference to pre-effective amendment no. 2 to the
Registration Statement filed September 18, 1997.
/3/ Incorporated by reference to pre-effective amendment no. 1 to the
Registration Statement filed September 10, 1997.
/4/ Incorporated by reference to post-effective amendment no. 1 to the
Registration Statement filed October 2, 1997.
/5/ Incorporated by reference to post-effective amendment no. 2 to the
Registration Statement filed April 14, 1998.
/6/ Filed herewith.
Item 17. Undertakings.
(1) The undersigned registrant agrees that prior to any public reoffering
of the securities registered through the use of a prospectus which is a part of
this registration statement by any person or party who is deemed to be an
underwriter within the meaning of Rule 145(c) of the Securities Act of 1933 (the
"1933 Act"), the reoffering prospectus will contain the information called for
by the applicable registration form for reofferings by persons who may be deemed
underwriters, in addition to the information called for by the other items of
the applicable form.
(2) The undersigned registrant agrees that every prospectus that is filed
under paragraph (1) above will be filed as part of an amendment to the
registration statement and will not be used until the amendment is effective,
and that, in determining any liability under the 1933 Act, each post-effective
amendment shall be deemed to be a new registration statement for the securities
offered therein, and the offering of the securities at that time shall be deemed
to be the initial bona fide offering of them.
(3) The registrant undertakes to furnish each person to whom a prospectus
is delivered with a copy of the registrant's latest annual report to
shareholders upon request and without charge.
<PAGE>
SIGNATURES As required by the Securities Act of 1933, this registration
statement has been signed on behalf of the Registrant, in the City of
Pittsburgh, and State of Pennsylvania, on the ______ day of April, 1999.
GREAT PLAINS FUNDS
By:______________________________________
Gail Cagney, Attorney In Fact for
Edward C. Gonzales, President
____________________, 1999
As required by the Securities Act of 1933, this registration statement has
been signed by the following persons in the capacities and on the dates
indicated:
SIGNATURE TITLE DATE
By:______________________ Attorney In Fact For
Gail Cagney the Persons Listed Below __________, 1999
Edward C. Gonzales* President
Beth Broderick* Treasurer
(Principal Financial
and Accounting Officer)
Hugh Hansen* Trustee
George E. Howard* Trustee
Dr. Martin J. Massengale* Trustee
Keith C. Mitchell* Trustee
---------------
*By Power of Attorney
<PAGE>
EXHIBIT INDEX
4. Agreement and Plan of Reorganization and Liquidation between Great Plans
Funds and Lancaster Funds dated April 21, 1999. (See Exhibit A to
Proxy Statement/Prospectus)
11. Opinion of Federated Administrative Services dated April 21, 1999.
12. Opinion of Cline, Williams, Wright, Johnson & Oldfather dated
April 14, 1999.
14(a). Consent of Deloitte & Touche LLP for Lancaster Funds.
14(b). Consent of Deloitte & Touche LLP for Great Plains Funds.
16. Powers of Attorney.
17. Form of Proxy
Federated Administrative Services
Federated Investors Tower
Pittsburgh, PA 15222
412-288-1900
April 21, 1999
The Trustees of
Great Plains Funds
Federated Investors Tower
Pittsburgh, PA 15222-3779
Gentlemen:
Great Plains Funds (the "Trust") proposed to offer and sell shares of
beneficial interest in its portfolios of securities known as Great Plains Equity
Fund, Great Plains Premier Fund and Great Plains Intermediate Bond Fund
("Shares") in the manner and on the terms set forth in its Registration
Statement filed on Form N-14 with the Securities and Exchange Commission under
the Securities Act of 1933, as amended.
As counsel I have participated in the preparation and filing of the Trust's
Registration Statement under the Securities Act of 1933. Further, I have
examined and am familiar with the provisions of the Declaration of Trust dated
July 1, 1997 ("Declaration of Trust"), the Bylaws of the Trust and such other
documents and records deemed relevant. I have also reviewed questions of law and
consulted with counsel thereon as deemed necessary or appropriate by me for the
purposes of this opinion.
Based upon the foregoing, it is my opinion that
l. The Trust is duly organized and validly existing pursuant to the laws of
the Commonwealth of Massachusetts.
2 The Shares which are currently being registered by the Registration
Statement referred to above may be legally and validly issued from time to
time in accordance with the Declaration of Trust upon receipt of
consideration sufficient to comply with the Declaration of Trust and
subject to compliance with the Securities Act of 1933, as amended, the
Investment Company Act of 1940, as amended, and applicable state laws
regulating the sale of securities. Such Shares, when so issued, will be
fully paid and non-assessable by the Trust.
I hereby consent to the filing of this opinion as an exhibit to the
Registration Statement referred to above and to any application or registration
statement filed under the securities laws of any of the States of the United
States.
The foregoing opinion is limited to the Federal laws of the United States
and the laws of the Commonwealth of Massachusetts, and I am expressing no
opinion as to the effect of the laws of any other jurisdiction.
Very truly yours,
Gail Cagney
Secretary
Great Plains Funds
EXHIBIT 12
April 14, 1999
Board of Directors
SMITH HAYES Trust, Inc.
Board of Trustees
Great Plains Funds
RE: Plan of Reorganization for Combining Certain Portfolios of the
SMITH HAYES Trust, Inc. (the "Acquired Funds"), into
Corresponding Portfolios of the Great Plains Funds (the
"Acquiring Funds")
Dear Sirs:
We have been asked to give our opinion relating to the above-described
transaction (the "Reorganization"), as to certain Federal income tax
consequences of consummating the transactions contemplated in the Agreement and
Plan of Reorganization dated April 14, 1999 (the "Plan"). Capitalized terms not
otherwise defined herein shall have the meanings ascribed to them in the Plan.
Background
SMITH HAYES Trust, Inc., d/b/a Lancaster Funds ("Lancaster") is a
Minnesota corporation consisting of multiple investment portfolios, including
the Acquired Funds. Great Plains Funds ("Great Plains") is a Massachusetts
business trust consisting of multiple investment portfolios, including the
Acquiring Funds. The Acquired Funds and the Acquiring Funds are sometimes
referred to herein collectively as "Funds." Lancaster and Great Plains each is
registered under the Investment Company Act of 1940, as amended, as an open-end
management investment company.
<PAGE>
April 14, 1999
Page 2
It is proposed that all the assets and liabilities of each Acquired Fund
be transferred to a corresponding Acquiring Fund as set forth in the Plan. As
consideration for such transfer, each Acquiring Fund is issuing to the
corresponding Acquired Fund a number of full and fractional shares of common
stock in such Acquiring Fund equal to the net asset value of the shares
outstanding of such Acquired Fund at the Valuation Date of the Reorganization.
Immediately after the transfer, the Acquiring Fund shares issued to the
Acquired Funds are to be distributed to the shareholders of the respective
Acquired Funds in liquidation of such Acquired Funds, and such Acquired Funds
are to cease operations. Each Acquired Fund shareholder is receiving shares of
an Acquiring Fund in proportion to the shareholding in such Acquired Fund
immediately before the Reorganization. The outstanding shares of each Acquired
Fund are to be canceled, and each Acquired Fund is to be terminated.
Assumptions
For purposes of this opinion, we have made several assumptions:
First, that each of the Funds qualified as a "regulated investment company"
under Part I of Subchapter M of Subtitle A, Chapter 1, of the Internal Revenue
Code of 1986, as amended (the "Code") and also met the diversification
requirements of Code ss.368(a)(2)(F), for its most recently ended taxable year
and will continue to so qualify for its current taxable year;
Second, that each Acquiring Fund is acquiring at least 90% of the fair
market value of the net assets and at least 70% of the fair market value of the
gross assets held by the corresponding Acquired Fund immediately prior to the
transaction, treating any assets used to make other than regular and normal
distributions or redemptions as unacquired assets;
Third, that the shareholders of each Acquired Fund have no plan or
intention to dispose of a number of shares of the corresponding Acquiring Fund
received by them as a result of the transaction which would result in their
owning in the aggregate shares of such Acquiring Fund having a fair market value
that is less than 50% of the fair market value of the Acquired Fund's shares
outstanding immediately before the transaction (including any of the Acquired
Fund's shares redeemed in anticipation of the transaction);
<PAGE>
April 14, 1999
Page 3
Fourth, that no Acquiring Fund has a plan or intention to reacquire any
of its shares issued in the transaction, except for redemptions in the ordinary
course of business as a regulated investment company;
Fifth, that no Acquiring Fund has a plan or intention to sell or
otherwise to dispose of any of the assets of an Acquired Fund acquired in the
transaction, except for dispositions made in the ordinary course of business;
Sixth, that the liabilities of each Acquired Fund assumed by the
corresponding Acquiring Fund and the liabilities to which the transferred assets
of such Acquired Fund are subject were incurred by such Acquired Fund in the
ordinary course of business;
Seventh, that the transaction serves a business purpose or purposes of
the Funds and that following the transaction each Acquiring Fund will continue
the historic business of the corresponding Acquired Fund or use a significant
portion of such Acquired Fund's historic business assets in a business;
Eighth, that there is no intercorporate indebtedness existing between
any Acquiring Fund and any Acquired Fund that was issued, acquired or will be
settled at a discount;
Ninth, that no Acquiring Fund owns, directly or indirectly, nor has it
owned during the past five years, directly or indirectly, any stock of any
Acquired Fund;
Tenth, that no Acquired Fund is under the jurisdiction of a court in a
case under Title 11 of the United States Code or a receivership, foreclosure or
similar proceeding in any Federal or State court; and
Eleventh, that the Plan substantially in the form included as an exhibit
to the registration statement of Great Plains, on Form N-14 under the Securities
Act of 1933 (the "Registration Statement") has been or will be duly authorized
by Great Plains.
The opinions set forth below are subject to the approval of the Plan by
the shareholders of Lancaster, to the proper submission and filing of
appropriate documents with the appropriate government agencies and to the
satisfaction of the terms and conditions set forth in the Plan.
<PAGE>
April 14, 1999
Page 4
Conclusions
Based upon the Code, applicable Treasury Department regulations in
effect as of the date hereof, current published administrative positions of the
Internal Revenue Service contained in revenue rulings and procedures, and
judicial decisions, and upon the information, representations and assumptions
contained herein and in the documents provided to us by you, it is our opinion
for Federal income tax purposes that:
(i) the transfer of all of the assets and liabilities of an
Acquired Fund to the corresponding Acquiring Fund in exchange for shares
of such Acquiring Fund and distribution to shareholders of such Acquired
Fund of the shares of such Acquiring Fund so received, as described in
the Plan, will constitute a reorganization within the meaning of Code
section 368(a)(1)(C);
(ii) in accordance with sections 361(a), 361(c)(1) and 357(a) of
the Code, no gain or loss will be recognized by an Acquired Fund as a
result of such transaction;
(iii) in accordance with section 1032(a) of the Code, no gain or
loss will be recognized by an Acquiring Fund as a result of such
transaction;
(iv) in accordance with section 354(a)(1) of the Code, no gain or
loss will be recognized by the shareholders of an Acquired Fund on the
distribution to them by such Acquired Fund of shares of the
corresponding Acquiring Fund in exchange for their shares of such
Acquired Fund;
(v) in accordance with section 358(a)(1) of the Code, the basis
of an Acquiring Fund's shares received by a shareholder of the
corresponding Acquired Fund will be the same as the basis of the
shareholder's Acquired Fund shares immediately before the transaction;
(vi) in accordance with section 362(b) of the Code, the basis to
an Acquiring Fund of the assets of the corresponding Acquired Fund
received pursuant to the transaction will be the same as the basis of
those assets in the hands of such Acquired Fund immediately before the
transactions;
<PAGE>
April 14, 1999
Page 5
(vii) in accordance with section 1223(1) of the Code, a
shareholder's holding period for Acquiring Fund shares will be
determined by including the period for which the shareholder held
Acquired Fund shares exchanged therefor, provided that the shareholder
held such Acquired Fund shares as a capital asset; and
(viii) in accordance with section 1223(2) of the Code, an Acquiring
Fund's holding period with respect to any asset acquired from an
Acquired Fund will include the period for which such asset was held by
such Acquired Fund.
We express no opinion relating to any Federal income tax matter except on
the basis of the documents and assumptions described above. In issuing our
opinion, we have relied solely upon existing provisions of the Code, existing
regulations thereunder, and current administrative rulings and court decisions.
Such laws, regulations, administrative rulings and court decisions are subject
to change at any time. Any such change could affect the validity of the opinion
set forth above. We express no opinion on any state or local tax issues.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement and to the references to our firm under the caption
"Proposal - Agreement and Plan of Reorganization - Federal Income Tax
Consequences" in the Proxy Statement/Prospectus constituting a part of the
Registration Statement.
Very truly yours,
/s/
CLINE, WILLIAMS, WRIGHT,
JOHNSON & OLDFATHER
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in this Registration Statement of
SMITH HAYES Trust, Inc. d/b/a Lancaster Funds Government/Quality Bond Fund,
Capital Builder Fund, Crestone Small Cap Fund, and Convertible Fund on Form N-14
of our report dated July 24, 1998 appearing in the Annual Report dated June 30,
1998.
/s/ DELOITTE & TOUCHE LLP
DELOITTE & TOUCHE LLP
Lincoln, Nebraska
April 15, 1999
EXHIBIT 14(b).
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in this Registration Statement of
Great Plains Equity Fund, Great Plains Premier Fund, Great Plains Intermediate
Bond Fund on Form N-14 of our report dated October 9, 1998 appearing in the
Combined Annual Report of Great Plains Funds (comprised of Great Plains Equity
Fund, Great Plains Premier Fund, Great Plains Intermediate Bond Fund, and Great
Plains Tax-Free Bond Fund) for the year ended August 31, 1998, which is part of
this Registration Statement.
DELOITTE & TOUCHE LLP
Pittsburgh, Pennsylvania
April 21, 1999
Exhibit 16
Powers of Attorney
POWER OF ATTORNEY
Each person whose signature appears below hereby constitutes and
appoints the Secretary and Assistant Secretary of GREAT PLAINS FUNDS
and the Deputy General Counsel of Federated Services Company, and each
of them, their true and lawful attorneys-in-fact and agents, with full
power of substitution and resubstitution for them and in their names,
place and stead, in any and all capacities, to sign any and all
documents to be filed with the Securities and Exchange Commission
pursuant to the Securities Act of 1933, the Securities Exchange Act of
1934 and the Investment Company Act of 1940, by means of the
Securities and Exchange Commission's electronic disclosure system
known as EDGAR; and to file the same, with all exhibits thereto and
other documents in connection therewith, with the Securities and
Exchange Commission, granting unto said attorneys-in-fact and agents,
and each of them, full power and authority to sign and perform each
and every act and thing requisite and necessary to be done in
connection therewith, as fully to all intents and purposes as each of
them might or could do in person, hereby ratifying and confirming all
that said attorneys-in-fact and agents, or any of them, or their or
his substitute or substitutes, may lawfully do or cause to be done by
virtue thereof.
SIGNATURE TITLE DATE
Edward C. Gonzales President April ___, 1999
Beth Broderick Treasurer April ___, 1999
(Principal Financial
and Accounting Officer)
Hugh Hansen Trustee April ___, 1999
George E. Howard Trustee April ___, 1999
Dr. Martin J. Massengale Trustee April ___, 1999
Keith C. Mitchell Trustee April ___, 1999
Sworn to and subscribed before me this ____ day of April, 1999
Notarial Seal
EXHIBIT 17
PROXY
FOR SPECIAL MEETING OF SHAREHOLDERS OF
LANCASTER __________________ FUND
June ____, 1999
The undersigned hereby appoints Thomas C. Smith and Colleen Avery, and
each of them, proxies for the undersigned, with full power of substitution to
represent the undersigned and to vote all the shares of Lancaster Fund (the
"Lancaster Fund") of SMITH HAYES Trust, Inc., which the undersigned is entitled
to vote at the Special Meeting of Shareholders of the Lancaster Fund to be held
on June ____, 1999 and at any adjournment thereof.
Proposal to approve a reorganization of the Lancaster Fund
providing for (i) the transfer of substantially all of the assets
and liabilities of the Lancaster Fund to Great Plains ("GP
Fund"), a separate series of Great Plains Funds, in exchange for
shares of GP Fund (the "GP Fund Shares") of equivalent value,
(ii) the pro rata distribution of those GP Fund Shares to the
shareholders of the Lancaster Fund in full redemption of those
shareholders' shares in the Lancaster Fund, and (iii) the
immediate liquidation and termination of the Lancaster Fund, all
as described in the accompanying Combined Proxy
Statement/Prospectus.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
And, in their discretion, to transact any other business that may lawfully come
before the meeting or any adjournment(s) thereof.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS AND WILL BE
VOTED AS YOU DIRECT ON THIS FORM. IF NO DIRECTION IS GIVEN, THIS PROXY WILL BE
VOTED FOR THE PROPOSAL.
Dated: _____________________________, 1999
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Signature of Shareholder
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Signature of Shareholder
When shares are registered jointly in the names of two or more persons. ALL must
sign. Signature(s) must correspond exactly with the name(s) shown. Please, sign,
date and return promptly in the enclosed envelope.
