In addition to voting by mail you may also vote either by telephone or through the Internet as follows:
We encourage you to vote by telephone or through the internet using the control number that appears on the enclosed proxy card. Use of telephone or internet voting will reduce the time and costs associated with this proxy solicitation. Whichever method you choose, please read the enclosed Proxy Statement carefully before you vote.
We appreciate your participation and prompt response to this matter and thank you for your continued support. If you have any questions after considering the enclosed materials, please call 1-877-632-0910.Okapi Partners, our proxy solicitor, toll-free at 1-888-785-6668.
Please vote by telephone or through the internet by following the instructions on your proxy card, thus avoiding unnecessary expense and delay. You may also execute the enclosed proxy and return it promptly in the enclosed envelope. No postage is required if mailed in the United States. The proxy is revocable and will not affect your right to vote in person if you attend the Meeting. |
5
IMPORTANT INFORMATION TO HELP YOU UNDERSTAND THE PROPOSALS
While we encourage you to carefully read the entire text of the Proxy Statement, for your convenience we have provided answers to some of the most frequently asked questions and a brief summary of the proposals to be voted on by shareholders.
QUESTIONS AND ANSWERS
While we encourage you to carefully read the entire text of the Proxy Statement, for your convenience we have provided answers to some of the most frequently asked questions and a brief summary of the proposal to be voted on by shareholders.
Q: What is happening? Why did I get this package of materials?
A:A: The Schwartz Value Focused FundInvestment Trust (the “Fund”“Trust”) is conducting a special meeting of shareholders (the “Special Meeting” or “Meeting”), scheduled to be held at 10:0030 a.m., Eastern Time, on June 29, 2016.March 15, 2018. According to our records, you are a shareholder of record of one of the Fundfunds in the Trust as of May 6, 2016,January 16, 2018, the record date for this Meeting.
Q: Why are shareholdersam I being asked to vote on changing the Fund’s sub-classification from a diversified to a non-diversified Fund?elect Trustees?
A:A: Schwartz Investment Counsel, Inc. (the “Adviser”) has recommended The Trust is required to hold a shareholder meeting for the purpose of electing Trustees to ensure that at least two-thirds of the members of the Board of Trusteeshave been elected by the shareholders of the Trust thatas required by the Fund change its sub-classification from a diversified fund to a non-diversified fund in order to enableInvestment Company Act of 1940, as amended (the “Investment Company Act”). The Board has considered the Fund to invest larger percentagesqualifications of its assets in the securities of a single issuer. The proposed change would provide increased flexibility to take advantage of future investment opportunities by allowing the Adviser to add meaningfully to certain positions in the Fund if it has a strong conviction about their potential for capital appreciation or to take larger positions initially. The proposed change would also allow the Adviser to take a more focused investment approach and to invest in a smaller number of issuers, business sectors or group of industries. The Adviser believes this increased flexibility may provide opportunities to enhance the Fund’s performance; however, investing a larger percentage of assets in any one issuer could increase the risk and volatilityeach of the Fund.
Q: Why are shareholders being askednominees, including those nominees that currently serve as Trustees, and determined that each is qualified to voteserve on removing certain of the Fund’s fundamental investment limitations?
A: Board.The proposed elimination of the fundamental investment limitations of the Fund with respect to amounts that can be invested in one issuer and amounts that can be invested in unseasoned issuers (or securities that are subject to legal or contractual restrictions on resale) are intended to provide the Fund with more investment flexibility. Since the time each of these limitations were adopted, there have been many changes to federal or state regulatory oversight and these limitations are outdated and are no longer required by law. The existing fundamental investment limitations of the Fund with respect to amounts that can be invested in one issuer are based, in part, upon the requirements for a “diversified” fund under the 1940 Act but are actually more restrictive than the 1940 Act requirements for a diversified fund. Under the 1940 Act, the 5% limitation on amounts invested in one issuer only applies to 75% of a fund’s portfolio and not 100% of the portfolio, as currently set forth in the Fund’s fundamental limitation. If the Fund’s fundamental investment limitations with respect to the amounts that can be invested in one issuer are eliminated, but shareholders do not approve the change in classification to a non-diversified fund, the Fund would still have more investment flexibility in that it will be permitted to take greater than 5% positions as it relates to 25% of the Fund’s portfolio. (See “Diversified Fund Within the Meaning of the 1940 Act” in the Proxy Statement).
Q: How will the proposed changes impact the investment process of the Fund?
A: The changes are being proposed in conjunction with the proposed implementation of a more focused investment strategy for the Fund that will give the Adviser the ability, from time to time, to invest a substantial portion of the Fund’s assets in a smaller number of issuers, business sectors or group of industries. The Fund may also invest more meaningfully in smaller, less seasoned issuers and in special situation companies that have fallen out of favor with the market but that the Adviser expects to appreciate over time due to company-specific developments, rather than general business conditions or movements in the markets as a whole. The Adviser believes that this strategy may provide greater potential to add meaningfully to a position if it has a strong conviction about the potential for capital appreciation. However, investing a larger percentage of assets in any one issuer, in a smaller number of issuers, in smaller, less seasoned companies, or in special situation companies, could increase the risk and volatility of the Fund. No assurance can be given that operating the Fund as a non-diversified fund and removing these fundamental investment limitations will improve its investment performance.
Q: What happens if shareholders do not approve the proposals?
A: The Fund will not operate as a non-diversified fund within the meaning of the 1940 Act unless Proposal 1, Proposal 2 and Proposal 3 are approved by the Fund’s shareholders. Approval of Proposals 2 and 3, without approval of Proposal 1, will allow for the Fund to operate as a diversified fund within the meaning of the 1940 Act, and is less restrictive than the Fund’s existing fundamental investment limitation. Under the 1940 Act, the 5% limitation on amounts invested in one issuer only applies to 75% of a fund’s portfolio and not 100% of the portfolio, as currently set forth in the Fund’s fundamental limitation. With respect to Proposals 2, 3, and 4, if any proposal is approved by shareholders of the Fund, it will be implemented for the Fund.
Q: Why might I receive more than one Proxy Card?
A: If you own shares that are registered in different accounts, you may receive a separate proxy card for the shares held in each named account and should vote each proxy card received.
Q: How does the Board of Trustees recommend that I vote?
A:A: After careful consideration of the proposals,proposal, the Board of Trustees unanimously recommends that you vote FOR eachthe proposal. Information on the qualifications of the proposals. The various factors that the Board of Trustees considered in making these determinations are describednominees is set forth in the accompanying Proxy Statement.
Q: What will happen if there are not enough votes to hold the Meeting?
A:A: It is important that shareholders vote by telephone or internet or complete and return signed proxy cards promptly, but no later than June 28, 2016March 14, 2018 to ensure there is a quorum for the Meeting. You may be contacted by a representative of the Trust or a proxy solicitor if we do not hear from you. If we have not received sufficient votes to have a quorum at the Meeting or have not received enough votes to approve the proposals,proposal, we may adjourn the Meeting to a later date so we can continue to seek more votes.
Q: WhomWho should I call for additional information about the Proxy Statement?
A: If you have any questions regarding the Proxy Statement or completing and returning your proxy card, you can call 1-877-632-0910.1-888-785-6668.
SCHWARTZ INVESTMENT TRUST
SPECIAL
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INFORMATION ABOUT THE MEETING OF SHAREHOLDERS
OF THE SCHWARTZ VALUE FOCUSED FUND
To Be HeldThis proxy statement is being provided to you on June 29, 2016
Atbehalf of the Board of Trustees in connection with the Special Meeting of Shareholders to be held on Thursday, March 15, 2018 at 10:30 a.m., Eastern time (the “Special Meeting” or “Meeting”). The Special Meeting will be held at the offices of the Trust’s transfer agent, Ultimus Fund Solutions, LLC, 225 Pictoria Drive, Suite 450,
Cincinnati, Ohio 45246
PROXY STATEMENT
This Proxy Statement is being furnished in connection with the solicitation of proxies by the Board of Trustees of45246. In this proxy statement, Schwartz Investment Trust (the “Trust”) for usewill be referred to as the “Trust.” The shares of the Trust entitled to vote at the Special Meeting of Shareholders, or any adjournment thereof (the “Meeting”) ofare issued in series. Currently there are six series issued – the Schwartz Value Focused Fund, (thethe Ave Maria Value Fund, the Ave Maria Growth Fund, the Ave Maria Rising Dividend Fund, the Ave Maria World Equity Fund and the Ave Maria Bond Fund (each of which will be referred to individually as a “Fund” and together as the “Funds”), a series.
This notice of the Trust. The principal address of the Trust is 801 W. Ann Arbor Trail, Suite 244, Plymouth, Michigan 48170. This Proxy StatementSpecial Meeting and proxy card werestatement are first being mailed to shareholders on or about May 13, 2016.
As described in more detail below, at the Meeting shareholders are being asked to vote on a proposal that would change the sub-classification of the Fund from a diversified fund to a non-diversified fund, as defined by the 1940 Act, and to vote on proposals to remove certain fundamental investment limitations of the Fund that generally have the effect of requiring it to operate within the parameters of a diversified fund.
A proxy, if properly executed, duly returned and not revoked, will be voted in accordance with the specifications therein. A proxy that is properly executed but has no voting instructions with respect to a proposal will be voted for that proposal. A shareholder may revoke a proxy at any time prior to use by filing with the Assistant Secretary of the Trust an instrument revoking the proxy, by submitting a proxy bearing a later date, or by attending and voting at the Meeting.
The Trust has retained Computershare Fund Services (“Computershare”) to solicit proxies for the Meeting. Computershare is responsible for printing proxy cards, mailing proxy material to shareholders, soliciting broker-dealer firms, custodians, nominees and fiduciaries, tabulating the returned proxies and performing other proxy solicitation services. The anticipated cost of these services is approximately $3,950, and will be paid by the Adviser.
In addition to solicitation through the mail, proxiesaround January 22, 2018. Supplementary solicitations may be solicitedmade by representatives of the Trust without cost to the Trust. Such solicitation may be by mail, telephone, e-mail, facsimile or otherwise. Itother electronic means.
Costs of Proxy and Proxy Solicitation Services. All costs associated with the Special Meeting, including the expenses of preparing, printing and mailing this proxy statement and the solicitation and tabulation of proxies, will be borne by the Funds. The Trust has retained Okapi Partners to assist with the distribution, tabulation and solicitation of proxies. The estimated costs of such services by Okapi Partners is anticipated that banks, broker-dealers, custodians,$35,800. Banks, brokerage houses, nominees fiduciaries and other financial institutionsfiduciaries will be requested to forward this proxy materials to beneficial owners and to obtain approval for the execution of proxies. Upon request, the Adviser will reimburse brokers, custodians, nominees and fiduciaries for the reasonable expenses incurred by them in connection with forwarding solicitation materialstatement to the beneficial owners of shares held of record by such persons.
SUMMARY OF PROPOSAL 1, PROPOSAL 2, PROPOSAL 3 AND PROPOSAL 4
To Approve the Reclassification of the Fund from a “Diversified” to a “Non-Diversified” FundFunds and Removing Certain Fundamental Investment Limitations of the Fund
Diversified Fund Within the Meaning of the 1940 Act.obtain authorization for executing proxies. The 1940 Act requires each investment company to recite in its registration statement its status as either a diversified or a non-diversified fund. Currently, the Fund is classified as “diversified,” meaning that it is limitedFunds may reimburse brokers, banks and other fiduciaries for postage and reasonable expenses incurred in the amountforwarding of assets it can invest in securities of any one individual issuer. As a diversified fund under the 1940 Act requirements, a fund may not purchase the securities of any one issuer if, as a result, with respect to 75% of the fund’s total assets, more than 5% of the value of its total assets would be invested in the securities of any one issuer or the fund’s ownership would be more than 10% of the outstanding voting securities of that issuer, provided that this restriction does not limit the fund’s investments in securities issued or guaranteed as to principal or interest by the U.S. Government or any of its agencies or instrumentalities, or investments in securities of other investment companies. With respectproxy materials to the remaining 25% of a fund’s total assets, there is no limitation on the amount of assets the fundbeneficial owners. Supplementary proxy solicitation services may investinclude any additional solicitation made by letter, Internet, telephone or telecopy. Expenses incurred in any one issuer. These limits apply at the time a fund purchases a security; the fund may exceed these limits if positions it already owns increase in value relative to the remainder of its holdings. Currently, the fundamental investment restrictions included in Proposals 2 and 3 are more restrictive than required by the 1940 Act for a diversified fund since the 5% limitation on amounts invested in one issuer only applies to 75% of a fund’s portfolio under the 1940 Act, and not 100% of the portfolio, as currently set forth in the Fund’s fundamental limitation. By approving Proposals 2 and 3, which would eliminate these two fundamental investment restrictions, the Fund could begin operating consistentconnection with the 1940 Act’s less restrictive definition of a diversified fund.
DISCUSSION OF PROPOSED CHANGES
At a meeting ofSpecial Meeting will generally be allocated among the Board of Trustees held April 22, 2016 (the “Board Meeting”),Funds based upon the Adviser presented a proposal to the Board to allow the Adviser to employ a more focused approach when managing the Fund, which would result in the ability of the Fund to invest in special situation companies and to hold proportionately larger positions in a relatively limited number of securities. Special situation companies may include companies that have fallen out of favor with the market but that the Adviser expects to appreciate over time due to company-specific developments, rather than general business conditions or movementsshareholders in the markets as a whole. At the Board Meeting, the Trustees, including all of the Trustees who are not “interested persons” of the Trust, as defined under the 1940 Act (the “Independent Trustees”), unanimously approved a change to the name of theeach Fund as well as certain non-material changes to the Fund’s investment strategies. These non-material changes became effective on May 1, 2016 and are reflected in the Fund’s May 1, 2016 Prospectus. Specifically, the Board approved (i) changing the Fund’s name from Schwartz Value Fund to Schwartz Value Focused Fund; (ii) the removal of disclosure indicating the Fund’s portfolio will consist primarily of large-cap companies and adding disclosure that states the Fund intends to invest in companies of all market capitalizations; and (iii) additional disclosure about the Fund’s investments in special situation companies that have fallen out of favor with the market but that the Adviser expects to appreciate over time.
Change to Non-Diversified Classification. Because the Adviser would like the ability, from time to time, to invest a substantial portion of the Fund’s assets in a smaller number of issuers, business sectors or group of industries, at the Board Meeting, the Trustees, including all the Independent Trustees, also approved a change to the Fund’s classification from a “diversified” to a “non-diversified” fund, as such terms are defined in the 1940 Act. The change to a non-diversified classification would allow the Fund to invest a larger percentage of its assets in the securities of a single issuer and thus enable the Adviser to take more meaningful positions in securities that it sees as having greater investment potential. At the Board Meeting, the Adviser represented that it does not believe the proposed changes would have a significant impact on the Fund’s portfolio turnover rate, or any significant tax implications. However, the Adviser’s investment decisions represent its subjective determinations and may not accurately reflect the investment prospects of a particular security. At the Board Meeting, the Adviser represented that it would continue to monitor the performance of the Fund following the change to a non-diversified classification. No assurance can be given that operating the Fund as a non-diversified fund will improve its investment performance.
Removal of Fundamental Limitations. Under the 1940 Act, the Fund is required to adopt certain “fundamental investment limitations” with respect to certain matters that can be changed only by a shareholder vote. Since the time each of the limitations described below were adopted, there have been many changes to federal or state regulatory oversight and these limitations are outdated and are no longer required by law. At the Board Meeting, the Trustees, including all of the Independent Trustees, approved removing three fundamental investment limitations of the Fund and are recommending that shareholders approve these changes. Shareholders are being asked to consider and approve the removal of two fundamental limitations (described below) with respect to amounts that can be invested in one issuer (“Fundamental Issuer Limitations”) that generally have the effect of requiring the Fund to operate as a diversified fund. The Fundamental Issuer Limitations are actually more restrictive than required by the 1940 Act for a diversified fund because under the 1940 Act, the 5% limitation on amounts invested in one issuer only applies to 75% of a fund’s portfolio, and not 100%, as currently setforth in the Fund’s Fundamental Issuer Limitations.
Fundamental Issuer Limitations |
1. The Fund will not purchase the securities of an issuer (other than the United States Government, its agencies or instrumentalities) if such purchase, at the time thereof, would cause more than 5% of the Fund’s total assets taken at market value to be invested in the securities of such issuer. |
2. The Fund will not purchase voting securities of any issuer if such purchase, at the time thereof, would cause more than 10% of the outstanding voting securities of such issuer to be held by the Fund. |
Shareholders are also being asked to consider and approve the removal of a fundamental limitation (described below) with respect to investments in securities of unseasoned issuers (or securities that are subject to legal or contractual restrictions on resale). The Board is recommending that shareholders of the Fund approve the removal of this fundamental investment limitation, as it could be interpreted as having the effect of limiting the Fund’s investments in smaller, less seasoned companies and in special situation companies. The elimination of this fundamental investment limitation could potentially allow the Adviser to take a more meaningful position in these securities.
Unseasoned Issuer Limitations |
The Fund will not invest more than 10% of its total assets in securities of unseasoned issuers or in securities which are subject to legal or contractual restrictions on resale. |
If shareholders of the Fund approve Proposals 2 and 3, the Fund will have more flexibility with respect to the amount that can be invested in one issuer. If shareholders of the Fund approve Proposal 4, the Fund will have more flexibility with respect to the amount that can be invested in securities of unseasoned issuers or securities that are subject to legal or contractual restrictions on resale. The removal of the second clause of the fundamental investment limitation (securities which are subject to legal or contractual restrictions on resale) will remove a restriction that is no longer required by law and will have no impact on the investment process of the Fund, as it currently does not intend to invest in these securities.
PRINCIPAL INVESTMENT STRATEGIES OF THE FUND
Under normal market conditions, the Fund invests at least 80% of its net assets, including the amount of any borrowings for investment purposes, in U.S. common stocks. The Fund may invest in the securities of companies of any size, regardless of market capitalization. The Fund may invest in special situation companies that have fallen out of favor with the market, but that the Adviser expects to appreciate over time due to company-specific developments, rather than general business conditions or movements in the markets as a whole. Special situations may include significant changes in a company's allocation of its existing capital (companies undergoing turnarounds or spin-offs) or a restructuring of assets. Special situations may also result from significant changes to an industry through regulatory developments or shifts in competition, new product introductions, changes in senior management or significant changes in a company's cost structure.
The Fund may also invest in exchange-traded funds ("ETFs") if the Adviser believes it is advisable to expose the Fund to the broad market or to broad market sectors or to hedge against market risk without purchasing a large number of individual securities. The Fund may invest in debt securities, which include U.S. Treasury notes and bonds, investment grade corporate debt securities, convertible debt securities and debt securities below investment grade (high yield or junk bonds). The Fund may also invest in cash or cash equivalents. The Fund's cash level is a result of the Adviser's individual security selection process, and therefore may vary, depending on the Adviser's desired security weightings. Under normal market conditions, the Fund will limit its investment in ETFs, debt securities (including junk bonds), and cash or cash equivalents to no more than 20% of its net assets.
EFFECT OF CHANGE TO A NON-DIVERSIFIED CLASSIFICATION
If shareholders of the Fund approve Proposal 1, the Fund will be classified as non-diversified and may therefore invest a greater percentage of its assets in the securities of fewer issuers than a fund that is diversified. At times, depending on market and other conditions, and in the sole discretion of the Adviser, the Fund may invest a substantial portion of its assets in a small number of issuers, business sectors or group of industries. The Adviser believes the additional advantages of non-diversification include:
· | Flexibility and Opportunity - The Fund’s investments may be limited to a smaller number of investment opportunities, allowing the Adviser to potentially avoid overvalued securities and to overweight a position if it has a strong conviction about its potential for capital appreciation.
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· | Potential for Enhanced Performance - Non-diversification allows the Adviser to invest a greater percentage of the assets of the Fund in individual securities believed to have the potential to significantly appreciate in value, which may have a meaningful impact on the performance of the Fund.
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Tax Requirements for Non-Diversified Funds. While the 1940 Act does not limit the amount of investments a non-diversified fund may make in a single issuer, the Fund intends to continue complying with the mutual fund diversification rules of the Internal Revenue Service (“IRS”). These rules provide that, to maintain favorable tax treatment, an investment company must invest at least 50% of its total assets so that no more than 5% of its total assets are invested in the securities of a single issuer and may not own more than 10% of the outstanding voting securities of any issuer. With respect to the remaining 50% of its total assets, an investment company is limited to investing 25% of the value of its total assets in the securities of a single issuer, or of two or more issuers that are controlled by the investment company and which are engaged in the same or similar trades or businesses or related trades or businesses, or securities of one or more qualified publicly traded partnerships. These limits apply only as of the end of each quarter of the investment company’s fiscal year, so the investment companyRecord Date.
BY VOTING IMMEDIATELY, YOU CAN HELP AVOID THE CONSIDERABLE EXPENSE OF ANY ADDITIONAL SOLICITATION OF PROXIES
Voting Your Proxy. If you vote your proxy now, you may actually have a higher concentration of assets in an issuer during periods between its fiscal quarter ends. Like the 1940 Act, the IRS limits do not apply to securities issued or guaranteed by the U.S. Government or any of its agencies or instrumentalities, or to the securities of other investment companies. If the investment company fails to meet the IRS diversification requirements as a result of fluctuations in the market value of the securities held in its portfolio or from distributions made by the investment company,revoke it will not lose its favorable tax treatment.
Risks of Non-Diversification. The risks of non-diversification include the risk that if the Fund invests a relatively high percentage of its assets in the securities of a limited number of issuers, adverse developments affecting a particular stock may cause the Fund’s performance to be more sensitive to developments affecting those stocks than a fund that is diversified. The share price of a non-diversified fund may be more volatile than the share price of a diversified fund and a non-diversified fund may be more susceptible to any single economic, business, political or regulatory occurrence than a diversified fund. If the Adviser’s investment decisions are not successful and a security fails to produce the expected results, the negative impact to the Fund may be greater than if the Fund were diversified.
The change to a non-diversified status would enable the Adviser to take more meaningful positions in securities in which it has the strongest conviction, if and when it believes that doing so justifies the risks involved in investing a larger percentage of the Fund’s assets in one issuer. The Adviser will attempt to address these risks through extensive research and monitoring in relation to the Adviser’s criteria for value.
The Fund will not operate as a non-diversified fund within the meaning of the 1940 Act unless Proposal 1, Proposal 2 and Proposal 3 are approved by the Fund’s shareholders. If shareholders of the Fund approve Proposals 1, 2 and 3, the reclassification will take effect shortly after the Meeting. In the event shareholders of the Fund do not approve Proposal 1, but approve Proposals 2 and 3, the Fund will be able to operate as a diversified fund under the requirements of the 1940 Act. With respect to Proposals 2, 3 and 4, if any proposal is approved, then it will be implemented for the Funds. In the event shareholders of the Fund do not approve any proposals, the Fund will continue to operate within the requirements of its current fundamental investment limitations. In that case, the Board may consider other courses of action.
THE BOARD OF TRUSTEES, INCLUDING THE INDEPENDENT TRUSTEES, UNANIMOUSLY RECOMMENDS THAT SHAREHOLDERS OF THE FUND VOTE "FOR" APPROVAL OF EACH OF PROPOSAL NO. 1, PROPOSAL NO. 2, PROPOSAL NO. 3 AND PROPOSAL NO. 4
PROPOSAL 5: TO TRANSACT ANY OTHER BUSINESS THAT MAY PROPERLY COME BEFORE THE MEETING OR ANY ADJOURNMENT THEREOF IN THE DISCRETION OF THE PROXIES OR THEIR SUBSTITUTES
The proxy holders have no present intention of bringing any other matter before the Meeting other thanusing any of the mattersvoting procedures described hereinon your proxy card or mattersby attending the Special Meeting and voting in connection with or for the purposeperson. Unless revoked, proxies that have been returned by shareholders without instructions will be voted in favor of effecting the same. Neitherall proposals. In instances where choices are specified on the proxy, holders northose proxies will be voted as the Board of Trustees are aware of any matters which may be presented by others. If any other business shall properly come before the Meeting, the proxy holders intend to vote thereon in accordance with their best judgment.shareholder has instructed.
OUTSTANDING SHARES AND VOTING REQUIREMENTS
Record Date. and Outstanding Shares. The Board of Trustees has fixed the close of business on May 6, 2016January 16, 2018 (the “Record Date”) as the record date for determiningthe determination of shareholders of the Fund entitled to notice of and to vote at the Special Meeting orand any adjournmentadjournment(s) thereof. AsShareholders of record as of the Record Date there were 829,309.376 shares of beneficial interest, no par value, of the Fund. All full shares of the Fund arewill be entitled to one vote withfor each share held and a proportionate votingvote for fractional shares.shares held. No
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5% Shareholders.
shares have cumulative voting rights. As of the Record Date, the following shareholders ownedtotal number of record or beneficially more than 5% of theissued and outstanding shares of the Fund. No other person ownedbeneficial interest of record and, according to information available to the Trust no other person owned beneficially 5% or more of theis 113,783,202.379. Below is a table reflecting each Fund’s outstanding shares as of the Fund on the Record Date.
Name and Address of Shareholder*Fund | Amount and Nature of OwnershipShares Outstanding | Percentage Ownership |
Louis C. ArgentaSchwartz Value Focused Fund | 174,937.811 shares of record856,348.268 | 21.09% |
Linda J. BaroliAve Maria Value Fund | 149,414.326 shares of record11,978,993.898 | 18.02% |
Ave Maria Growth Fund | 15,954,779.183 | |
Ave Maria Rising Dividend Fund | 53,681,294.194 | |
Ave Maria World Equity Fund | 4,148,898.589 | |
Ave Maria Bond Fund | 27,162,888.247 | |
Shareholder Vote Required.The addressvote of each shareholdera plurality of the Trust’s shares represented at the Meeting is c/orequired for the Adviser, 801 W. Ann Arbor Trail, Suite 244, Plymouth, Michigan 48170.election of Trustees (Proposal 1 below). If Proposal 1 does not receive enough “FOR” votes by the date of the Meeting to constitute approval, the named proxies may propose adjourning the Special Meeting to allow the gathering of more proxy votes.
Quorum.Quorum. A quorum is the number of shares legally required to be at a meeting in order to conduct business. The presence, in person or by proxy, of the holders of more than 50% of the outstanding shares of the FundTrust is necessary to constitute a quorum at the Special Meeting. Proxies properly executed and marked with a negative vote or an abstention will be considered to be present at the Meeting for purposes of determining the existence of a quorum for the transaction of business. If the Meeting is called to order but a quorum is not present at the Meeting, the persons named as proxies may vote those proxies that have been received with respect to adjournment of the Meeting to a later date. Ifor if a quorum is present at the Meeting but sufficient votes to approve a proposal described herein are not received to approve the proposal, the persons named as proxies may propose one or more adjournments of the Meetingmeeting to permit further solicitation of proxies. Any such adjournment will require the affirmative vote of a majority of those shares represented at the Meeting in person or by proxy. TheIf a quorum is not present, the persons named as proxies will vote those proxies received that voted in favor of the proposal in favor of such an adjournment, and will vote those proxies received that voted againstfor which they are required to vote “AGAINST” the proposal against any such adjournment.
If a quorum (more than 50% of the outstanding shares of the Fund) is represented at the Meeting, the vote of a majority of the outstanding shares of the Fund is required to approve Proposals 1, 2, 3 and 4. The vote of a majority of the outstanding shares of the Fund means the vote of the lesser of (1) 67% or more of the shares present or represented by proxy at the Meeting, if the holders of more than 50% of the outstanding shares are present or represented by proxy, or (2) more than 50% of the outstanding shares. Proposal 5 will require the affirmative vote of a majority of the shares voted, whether or not a quorum is present.
Abstentions and “broker non-voters”non-votes” are counted for purposes of determining whether a quorum is present but do not represent votes cast with respect to the proposal. “Broker non-votes” are shares held by a broker or nominee for which an executed proxy is received by the Trust, but are not voted as to one or more proposals because instructions have not been received from the beneficial owners or persons entitled to vote, and the broker or nominee does not have discretionary voting power. Notwithstanding the foregoing, “broker non-votes” will be excluded from the denominator of the calculation of the number of votes required to approve any proposal to adjourn the Meeting. Accordingly, abstentions and “broker non-votes” effectively will effectively be a vote against anythe proposal for which the required vote is a percentage of the outstanding voting shares and will have no effect on a vote for adjournment.
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Trustee Votes.Votes. The Trustees intend to vote all of their shares held in the FundFunds in favor of the proposalsproposal described herein. OnAs of the Record Date, the incumbent Trustees, Trustee nominee and officers of the Trust, as a group, owned of record and/or beneficially 6.38%11.03% of the outstanding shares of the Fund.Schwartz Value Focused Fund, 1.20% of the outstanding shares of the Ave Maria World Equity Fund, and less than 1% of the outstanding shares of each of the other Funds.
PROPOSAL 1:
ELECTION OF TRUSTEES
Seven individuals are being proposed for election to the Board of Trustees (the “Nominees”). Except for William A. Morrow, all Nominees are currently Trustees and have served in that capacity for the length of time indicated in the table below. At the Special Meeting, the shareholders of the Trust will be asked to elect the Nominees to serve on the Board of Trustees of the Trust. It is intended that the enclosed Proxy will be voted “FOR” the election of the seven Nominees named below as Trustees, unless such authority has been withheld in the Proxy.
Shareholders are being asked to elect the seven Nominees to serve on the Board of Trustees of the Trust to ensure that at least two-thirds of the members of the Board have been elected by the shareholders of the Trust as required by the Investment Company Act of 1940, as amended (the “Investment Company Act”). Currently, the Board consists of six Trustees, four of whom have been elected by shareholders and two of whom have not. However, with the nomination by the Trustees who are not considered to be “interested persons” under the Investment Company Act (the “Independent Trustees”) of a new member to the Board of Trustees, the Trust no longer would meet the requirement that two-thirds of all Trustees be elected by shareholders. To ensure continued compliance with the forgoing requirements of the Investment Company Act, shareholders are being asked at the Special Meeting to elect the seven Nominees. Each Nominee has indicated a willingness to serve as a member of the Board of Trustees if elected. If any of the Nominees should not be available for election, the persons named as proxies (or their substitutes) may vote for other persons in their discretion. However, management has no reason to believe that any Nominee will be unavailable for election. On November 3, 2017, the Independent Trustees met to review pertinent information on the nomination of William A. Morrow to serve on the Board. After considering Mr. Morrow’s background and experience, the Independent Trustees determined to nominate Mr. Morrow for election as a Trustee. The Board of Trustees recommends that William A. Morrow be elected to serve as a Trustee of the Trust.
The Board of Trustees Generally
The Trustees serve for an indefinite term, subject to death, resignation, removal or retirement. The Trustees have adopted a retirement policy that provides for a mandatory retirement age of 82 with the status of Trustee Emeritus until age 85 (which applies to all Trustees who were elected prior to November 2016). Trustees who were elected after November 2016 are subject to a mandatory retirement age of 80 with the status of
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OTHER MATTERS
Trustee Emeritus until age 83. Subject to the Investment Company Act and applicable Ohio law, the Trustees may fill vacancies in or reduce the number of Board members, and may elect and remove such officers and appoint and terminate such agents as they consider appropriate.
The Board of Trustees oversees the management of the Trust and meets at least quarterly to review reports about the Trust’s operations. The Board of Trustees provides broad supervision over the affairs of the Trust. The Board of Trustees, in turn, elects the officers of the Trust to actively supervise the Funds’ day-to-day operations. The Trustees may appoint from their own number and establish and terminate one or more committees consisting of two or more Trustees who may exercise the powers and authority of the Board to the extent that the Trustees determine. The Trustees may, in general, delegate such authority as they consider desirable to any officer of the Trust, to any committee of the Board and to any agent or employee of the Trust. During the most recent fiscal year ended December 31, 2017, the Board of Trustees held five meetings. Each Trustee attended each Board meeting (that occurred during his term in office) during the December 31, 2017 fiscal year.
Board Committees. The Board has established a Nominating and Governance Committee and an Audit Committee consisting entirely of the Independent Trustees. Donald J. Dawson, Jr. is the Chairman of the Nominating and Governance Committee and Joseph M. Grace is the Chairman of the Audit Committee. The members of each committee are, and subject to their election as Trustee at the Special Meeting, will continue to be, Donald J. Dawson, Jr., Louis C. Bosco, Jr., Joseph M. Grace, John J. McHale, Jr. and Edward J. Miller, and subject to his election as Trustee at the Special Meeting, William A. Morrow. The Audit Committee oversees (i) each Fund’s accounting and financial reporting policies and practices, its internal controls and, as appropriate in its judgment, the internal controls of certain service providers; and (ii) the quality and objectivity of the financial statements of each Fund and the independent audits thereof. In addition, the Audit Committee acts as a liaison between the Funds’ independent registered public accounting firm and the full Board and pre-approves the scope of the audit and non-audit services the independent registered public accounting firm provides to the Funds. The Nominating and Governance Committee oversees the independence and effective functioning of the Board and reviews in the first instance and makes recommendations to the Board regarding any investment advisory agreement relating to the Funds. The Nominating and Governance Committee will review shareholder recommendations for nominations to fill vacancies on the Board of Trustees if such recommendations are submitted in writing, addressed to the Nominating and Governance Committee at the Trust’s offices, and meet any minimum qualifications that may be adopted by the Committee. The Nominating and Governance Committee may adopt, by resolution, policies regarding its procedures for considering candidates for the Board of Trustees, including any recommended by shareholders. A copy of the Trust’s Nominating and Governance Committee charter is available free of charge, upon request directed to the Assistant Secretary of the Trust, and is included herewith as Appendix A. During the most recent fiscal year ended December 31, 2017, the Audit Committee met three times and the Nominating and Governance Committee met four times.
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Information Regarding the Nominees and Officers of the Trust
The following is a list of the Nominees, as well as the executive officers of the Trust. George P. Schwartz is an “interested person” of the Trust, as defined by the Investment Company Act. The other Nominees are Independent Trustees; that is, they are not considered “interested persons” of the Trust under the Investment Company Act because they are not employees or officers of, and have no financial interest in, the Trust’s affiliates or its service providers.
Name, Address and Year of Birth | Length of Service | Position(s) Held with Trust | Principal Occupation(s) During Past 5 Years and Directorships of Public Companies | Number of Funds in Trust Overseen by Trustee/Nominee | Other Directorships held by Trustee/ Nominee |
Interested Trustee/Nominee |
George P. Schwartz, CFA* 801 W. Ann Arbor Trail, Suite 244 Plymouth, Michigan 48170 Year of Birth: 1944 | Since August 1992 | Trustee/Chairman/ President/Nominee | Chairman and Chief Executive Officer of Schwartz Investment Counsel, Inc. (the “Adviser”) | 6 | None |
Independent Trustees/Nominees |
Louis C. Bosco, Jr. 801 W. Ann Arbor Trail, Suite 244 Plymouth, Michigan 48170 Year of Birth: 1936 | Since December 2008 | Trustee/Nominee | Retired Partner of Bosco Development Company (real estate firm) | 6 | None |
Donald J. Dawson, Jr. 801 W. Ann Arbor Trail, Suite 244 Plymouth, Michigan 48170 Year of Birth: 1947 | Since January 1993 | Trustee/Nominee | Retired, Prior to retirement, he was Chairman of Payroll 1, Inc. (payroll processing company) from 1986 until 2015 | 6 | None |
Joseph M. Grace 801 W. Ann Arbor Trail, Suite 244 Plymouth, Michigan 48170 Year of Birth: 1936 | Since August 2007 | Trustee/Nominee | Retired Senior Vice President of National Bank of Detroit (renamed JP Morgan Chase & Company) | 6 | None |
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Name, Address and Year of Birth | Length of Service | Position(s) Held with Trust | Principal Occupation(s) During Past 5 Years and Directorships of Public Companies | Number of Funds in Trust Overseen by Trustee/Nominee | Other Directorships held by Trustee/ Nominee |
John J. McHale, Jr. 801 W. Ann Arbor Trail, Suite 244 Plymouth, Michigan 48170 Year of Birth: 1949 | Since April 2014 | Trustee/Nominee | Special Assistant to the Commissioner of Major League Baseball (as of April 2015), Executive Vice President of Major League Baseball from 2000 until April 2015 | 6 | None |
Edward J. Miller 801 W. Ann Arbor Trail, Suite 244 Plymouth, Michigan 48170 Year of Birth: 1946 | Since May 2017 | Trustee/Nominee | Vice Chairman of the Board of the Detroit Investment Fund since 2001 and Invest Detroit Foundation since 2010 (financiers for redevelopment of Detroit Michigan) | 6 | None |
William A. Morrow 801 W. Ann Arbor Trail, Suite 244 Plymouth, Michigan 48170 Year of Birth:1947 | — | Nominee | Retired, Prior to retirement, he was Senior Executive Vice President of Crain Communications Inc. (business media) from 1985 to 2017 | N/A | None |
Executive Officers: |
Richard L. Platte, Jr., CFA* 801 W. Ann Arbor Trail, Suite 244 Plymouth, Michigan 48170 Year of Birth: 1951 | Since January 1993 | Vice President and Secretary | President and Chief Investment Officer (as of January 2014), Executive Vice President and Secretary (until January 2014) of the Adviser | | |
Timothy S. Schwartz, CFA* 5060 Annunciation Circle, Ste. 101 Ave Maria, Florida 34142 Year of Birth: 1971 | Since April 2000 | Treasurer | Executive Vice President and Chief Financial Officer of the Adviser | | |
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Name, Address and Year of Birth | Length of Service | Position(s) Held with Trust | Principal Occupation(s) During Past 5 Years and Directorships of Public Companies | Number of Funds in Trust Overseen by Trustee/Nominee | Other Directorships held by Trustee/ Nominee |
Cathy M. Stoner, CPA, IAACP* 801 W. Ann Arbor Trail, Suite 244 Plymouth, Michigan 48170 Year of Birth: 1970 | Since January 2010 | Chief Compliance Officer | Chief Compliance Officer, Vice President and Treasurer of the Adviser | | |
Robert C. Schwartz, CFP* 801 W. Ann Arbor Trail, Suite 244 Plymouth, Michigan 48170 Year of Birth: 1976 | Since October 2013 | Vice President | Senior Vice President and Secretary of the Adviser | | |
* | George P. Schwartz, Richard L. Platte, Jr., Timothy S. Schwartz, Cathy M. Stoner and Robert C. Schwartz, as affiliated persons of the Funds’ Adviser, are “interested persons” of the Trust within the meaning of Section 2(a)(19) of the 1940 Act. Timothy S. Schwartz and Robert C. Schwartz are sons of George P. Schwartz. |
CATHOLIC ADVISORY BOARD
The Ave Maria Value Fund, Ave Maria Growth Fund, Ave Maria Rising Dividend Fund, Ave Maria World Equity Fund and Ave Maria Bond Fund (together the “Ave Maria Mutual Funds”) have a Catholic Advisory Board (“CAB”) that provides guidance in setting the criteria for screening investments in order to construct the portfolios of the Ave Maria Mutual Funds in a way that is consistent with the core values and teachings of the Roman Catholic Church. The CAB is composed of prominent lay Catholics and clergy who provide religious guidance. The CAB reviews companies using publicly available information obtained by the Adviser and other sources in making its determinations. The CAB is not affiliated with the Roman Catholic Church.
The following is a list of the members of the CAB. Each member oversees each of the Ave Maria Mutual Funds and serves for an indefinite term, subject to death, resignation, retirement or removal. The address of each member is 801 W. Ann Arbor Trail, Suite 244, Plymouth, Michigan 48170.
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Name and Year of Birth | Length of Service | Principal Occupation(s) During Past 5 Years | Other Directorships Held by Member of CAB |
Paul R. Roney, Chairman Year of Birth: 1957 | Since April 2001 | Executive Director of the Ave Maria Foundation (a non-profit foundation supporting Roman Catholic organizations); President of Domino’s Farms Corporation. | None |
Lou Holtz* Year of Birth: 1937 | Since April 2007 | Former football coach at University of Notre Dame, among others, and former ESPN college football analyst, author and motivational speaker. | None |
Larry Kudlow Year of Birth: 1947 | Since July 2005 | CNBC’s Senior Contributor. Chief Executive Officer and founder of Kudlow & Co., LLC (an economic research and consulting firm). | None |
Thomas S. Monaghan Year of Birth: 1937 | Since April 2001 | Chairman of the Ave Maria Foundation (a non-profit foundation supporting Roman Catholic organizations); Chancellor of Ave Maria University. | None |
Robert P. George Year of Birth: 1955 | Since October 2016 | McCormick Professor of Jurisprudence and Professor of Politics at Princeton University, author, columnist and lecturer. He serves on a number of institutions that promote religious freedom and civil rights and is a recipient of many honors and awards. | None |
Father John Riccardo, STL * Year of Birth: 1965 | Since August 2011 | Priest of the Archdiocese of Detroit and Pastor of Our Lady of Good Counsel Catholic Church in Plymouth Michigan, host of radio show “Christ is the Answer.” | None |
Melissa Moschella, PhD Year of Birth: 1979 | Since April 2017 | Assistant Professor of Medical Ethics at the Columbia University College of Physicians and Surgeons since 2017; Assistant Professor of Philosophy at The Catholic University of America from 2013 until 2017. She has published articles about moral and political philosophy and ethics in a number of academic publications, is a lecturer, and recipient of a number of academic honors and fellowships. | None |
Gloria Purvis Year of Birth: 1969 | Since October 2017 | Creator and host of Eternal World Television Network (EWTN) series “Authentically Free at Last” and host of “Morning Glory” on EWTN Global Catholic Radio. She is active in the National Black Catholic Congress and in Black Catholics United for Life. | None |
* | These members have moved to “Emeritus” status. |
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Ownership in the Trust’s Adviser or Distributor by the Nominees who are Independent Trustees
As of the Record Date, none of the Trustees or Nominees who are Independent Trustees of the Trust hold any positions, or have any ownership interest in the Adviser, Ultimus Fund Distributors, LLC (the “Distributor”) or any affiliated person of the Trust.
Qualifications of Trustees
The Nominating and Governance Committee reviews the experience, qualifications, attributes and skills of potential candidates for nomination or election by the Board. In evaluating a candidate for nomination or election as a Trustee, the Nominating and Governance Committee takes into account the contribution that the candidate would be expected to make to the diverse mix of experience, qualifications, attributes and skills that the Nominating and Governance Committee believes contribute to good governance for the Trust. The Board has concluded, based on each Trustee’s experience, qualifications, attributes or skills on an individual basis and in combination with the other Trustees, that each Trustee is qualified and should continue to serve as such. In determining that a particular Trustee was and continues to be qualified to serve as a Trustee, the Board considered a variety of criteria, none of which, in isolation, was controlling.
George P. Schwartz |
Mr. George P. Schwartz has served as the Chief Executive Officer of the Adviser since he founded the Adviser in 1980. He has 50 years of experience in the investment management profession, including 7 years as an investment research analyst and partner with two New York Stock Exchange member firms and 6 years as Senior Investment Officer and Chairman of the Investment Committee of a national bank. Mr. Schwartz holds a B.S. degree in Finance from the University of Detroit. He is a Chartered Financial Analyst and a Chartered Investment Counselor. Mr. Schwartz has served as President and a Trustee of the Trust since August 1992. The Board concluded that Mr. Schwartz is suitable to serve as a Trustee because of his professional experience and his academic background. |
Louis C. Bosco, Jr. |
Mr. Louis C. Bosco, Jr. previously operated a closely-held real estate development company and was engaged in that business for over 35 years. He has also served on the Finance Committee of two non-profit organizations and has engaged in the private practice of law. Mr. Bosco holds a Ph.B. degree in Finance from the University of Notre Dame and a J.D. degree from the University of Detroit Law School. Mr. Bosco has served as a Trustee of the Trust since December 2008. The Board concluded that Mr. Bosco is suitable to serve as a Trustee because of his business and legal experience, his academic background and his service and experience on other boards. |
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Donald Dawson, Jr. |
Mr. Donald J. Dawson, Jr. previously served as the Chairman and President of a closely-held company from 1986 until 1998 and Chairman of that company from 1999 until 2015. He has also been a Board member of a non-profit organization since 2000, serving as Chairman from 2009 until 2011. Mr. Dawson holds a B.A. degree in Economics from Georgetown University and a J.D. degree from the University of Michigan Law School. He has previously been licensed with the Financial Industry Regulatory Authority (“FINRA”) as a general securities representative. Mr. Dawson has served as a Trustee of the Trust since January 1993. The Board concluded that Mr. Dawson is suitable to serve as a Trustee because of his business and legal experience, his academic background and his service and experience on other boards. |
Joseph M. Grace |
Mr. Joseph M. Grace was previously employed as Executive Vice President and Chief Financial Officer of a Michigan chartered state bank and later as Senior Vice President and head of the Investment Division of a national bank. He sits on the Investment Committee of several non-profit organizations. Mr. Grace holds a B.S. degree in Accounting from the University of Notre Dame. He is licensed as a Certified Public Accountant by the State of Michigan. Mr. Grace has served as a Trustee of the Trust since August 2007. The Board concluded that Mr. Grace is suitable to serve as a Trustee because of his business and investment experience, his academic and professional background and his service and experience on other boards. |
John J. McHale, Jr. |
Mr. John J. McHale, Jr. has served as the Special Assistant to the Commissioner of Major League Baseball since April 2015, responsible for special project assignments, grievances and on-field disciplinary matters, and previously served as Executive Vice President of Administration and Chief Information Officer for Major League Baseball from 2000 until 2015, overseeing the administrative functions of the MLB Central Office. Prior to 2002, he served in executive capacities for various Major League Baseball teams; Chief Operating Officer for the Tampa Bay Rays (2001-2002), President and Chief Executive Officer of the Detroit Tigers (1995-2001) and Executive Vice President of Baseball Operations of the Colorado Rockies (1991-1994). He is a Board member of the United States Amateur Baseball Federation, Inc., Baseball Tomorrow Fund, USA Baseball and a Trustee of several major league baseball retirement and pension plans. Mr. McHale holds an undergraduate degree from the University of Notre Dame, a J.D. degree from Boston College and an L.L.M. degree from Georgetown University. Mr. McHale has served as a Trustee of the Trust since April 2014. The Board concluded that Mr. McHale is suitable to serve as a Trustee because of his business and legal experience, his academic and professional background and his service and experience on other boards. |
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Edward J. Miller |
Mr. Edward J. Miller serves as Vice Chairman of the Board of the Detroit Investment Fund and the Invest Detroit Foundation (provides financing for residential and commercial redevelopment of the City of Detroit, Michigan) and was actively involved in the management of both organizations until 2016. Prior to joining the Detroit Investment Fund, Mr. Miller was an Executive Vice President at Standard Federal Bank (now Bank of America) from 1995 until 2000 where he was responsible for its commercial banking activities. Before he joined Standard Federal Bank, Mr. Miller held executive management positions with Comerica Bank and Manufacturers Bank (prior to its merger with Comerica). These positions included responsibility for Retail Banking (1993-1995) and Trust and Investment Management (1988-1993). He started his career with Manufacturers Bank in 1970 and held positions in commercial lending, strategic planning and corporate development before being appointed Executive Vice President in 1990. He is a Board member of various non-profit organizations. Mr. Miller holds a B.S degree from Regis University in Denver, Colorado and an M.B.A. from the University of Detroit. Mr. Miller has served as a Trustee of the Trust since May 2017. The Board concluded that Mr. Miller is suitable to serve as a Trustee because of his business and investment experience, his academic and professional background and his service and experience on other boards. |
William A. Morrow |
Mr. William A. Morrow served as a Senior Executive Vice President for Crain Communications Inc., an international business media company, from March 1985 until May 2017. As Senior Executive Vice President, he had overall responsibility for Crain Communications’ internal business operations, including finance, legal, acquisitions, administration, human resources, facilities and other corporate areas. He also served as Plan Administrator for Crain Communications’ Pension and Profit Sharing Plans. Prior to working at Crain, Mr. Morrow was a partner-in-charge in the Detroit office of Touche Ross & Co. (now Deloitte & Touche LLP) and a member of the firm’s national Management Advisory Council. He is active in many civic and business organizations, including serving as a Trustee and member of the Executive Committee at the University of Detroit Mercy. He is a former director of American Business Media, a membership association for business-to-business information providers, and previously served as Chairman. Mr. Morrow holds a B.S. degree in Accounting from the University of Detroit and a J.D. degree from Wayne State Law School. Mr. Morrow is a Trustee nominee. The Board concluded that Mr. Morrow is suitable to serve as a Trustee because of his business, legal and financial experience, his academic and professional background and his service and experience on other boards. |
THE BOARD OF TRUSTEES, INCLUDING THE INDEPENDENT TRUSTEES, UNANIMOUSLY RECOMMENDS THAT YOU VOTE “FOR” EACH OF THE NOMINEES.
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ADDITIONAL INFORMATION
Audit Committee Financial Expert. The Board of Trustees has determined that the Trust has at least one audit committee financial expert serving on the Audit Committee and has designated Joseph M. Grace and Edward J. Miller as an audit committee financial expert. Messrs. Grace and Miller are “independent” as defined by Securities and Exchange Commission (“SEC”) regulations.
Nominee Ownership of Shares of the Trust as of the Record Date. The following table shows the dollar range of beneficial ownership of shares of each Fund and, on an aggregate basis the dollar range of ownership of shares of all Funds within the Trust, held by each Nominee as of the Record Date. The Funds’ names have been abbreviated in the table as follows: Schwartz Value Focused Fund – SVFF; Ave Maria Value Fund – AMVF; Ave Maria Growth Fund – AMGF; Ave Maria Rising Dividend Fund – AMRDF; Ave Maria World Equity Fund – AMWEF; and Ave Maria Bond Fund – AMBF.
Name of Trustee or Nominee | Name of Fund | Dollar Range of Fund Shares Owned by Trustee/Nominee | Aggregate Dollar Range of Shares of All Funds in Trust Overseen by Trustee/Nominee |
Interested Trustee/Nominee: |
George P. Schwartz | SVFF AMVF AMGF AMRDF AMWEF AMBF | Over $100,000 Over $100,000 Over $100,000 Over $100,000 Over $100,000 Over $100,000 | Over $100,000 |
Independent Trustees/Nominees: |
Louis C. Bosco, Jr. | SVFF AMVF AMGF AMRDF AMWEF AMBF | None $10,001 – $50,000 $10,001 – $50,000 $1 – $10,000 $1 – $10,000 None | Over $100,000 |
Donald J. Dawson, Jr. | SVFF AMVF AMGF AMRDF AMWEF AMBF | $10,001 – $50,000 None Over $100,000 $50,001-$100,000 None Over $100,000 | Over $100,000 |
Joseph M. Grace | SVFF AMVF AMGF AMRDF AMWEF AMBF | None $1 – $10,000 $10,001 - $50,000 $10,001 - $50,000 $1 – $10,000 $1 – $10,000 | $10,001 - $50,000 |
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Name of Trustee or Nominee | Name of Fund | Dollar Range of Fund Shares Owned by Trustee/Nominee | Aggregate Dollar Range of Shares of All Funds in Trust Overseen by Trustee/Nominee |
John J. McHale | SVFF AMVF AMGF AMRDF AMWEF AMBF | None None $10,001- $50,000 None None None | $10,001- $50,000 |
Edward J. Miller | SVFF AMVF AMGF AMRDF AMWEF AMBF | None $1 – $10,000 $1 – $10,000 $1 – $10,000 $1 – $10,000 $1 – $10,000 | $10,001 - $50,000 |
William A. Morrow | SVFF AMVF AMGF AMRDF AMWEF AMBF | None None None None None None | None |
Independent Trustee Compensation. George P. Schwartz, as an “interested person” of the Trust, does not receive any compensation from the Trust for serving as a Trustee of the Trust. Effective January 1, 2018, each Independent Trustee receives from the Trust an annual retainer of $46,000, payable quarterly (except that such retainer is $56,000 for the Chairman of the Nominating and Governance Committee/Lead Independent Trustee and $50,000 for the Chairman of the Audit Committee), plus a fee of $6,000 for attendance at each meeting of the Board of Trustees. Prior to January 1, 2018, each Independent Trustee received from the Trust an annual retainer of $40,000, payable quarterly (except that such retainer was $50,000 for the Chairman of the Nominating and Governance Committee/Lead Independent Trustee and $44,000 for the Chairman of the Audit Committee), plus a fee of $6,000 for attendance at each meeting of the Board of Trustees. The fees are split equally among the Funds. The following table shows the compensation paid to each Trustee during the Trust’s fiscal year ended December 31, 2017:
| Aggregate Compensation From Each Fund | Pension or Retirement Benefits Accrued | Estimated Retirement Benefits Accrued | Aggregate Compensation From the Trust |
George P. Schwartz* | None | None | None | None |
Donald J. Dawson, Jr. | $12,333 | None | None | $74,000 |
Joseph M. Grace | $11,333 | None | None | $68,000 |
Louis C. Bosco, Jr. | $10,666 | None | None | $64,000 |
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| Aggregate Compensation From Each Fund | Pension or Retirement Benefits Accrued | Estimated Retirement Benefits Accrued | Aggregate Compensation From the Trust |
John J. McHale, Jr. | $10,666 | None | None | $64,000 |
Edward J. Miller** | $6,444 | None | None | $38,666 |
William A. Morrow*** | None | None | None | None |
* | George P. Schwartz is an “interested person” of the Trust |
** | Edward J. Miller began serving as a Trustee in May 2017 |
*** | William A. Morrow is a Trustee Nominee |
CAB Compensation. The Chairman of the CAB receives an annual retainer of $14,000, payable quarterly, and a fee of $3,000 for each CAB meeting attended. All other CAB members, including Emeritus members, receive an annual retainer of $4,000 and a fee of $3,000 for each CAB meeting attended. All CAB members are reimbursed for travel and other expenses incurred in attending meetings. The following table shows the compensation paid by the Ave Maria Mutual Funds to members of the CAB during the Trust’s fiscal year ended December 31, 2017:
CAB Member | | Compensation | |
Paul R. Roney, Chairman | | $ | 20,000 | |
Lou Holtz, Emeritus | | $ | 4,000 | |
Larry Kudlow | | $ | 10,000 | |
Thomas S. Monaghan | | $ | 10,000 | |
Father John Riccardo, STL, Emeritus | | $ | 4,000 | |
Robert P. George | | $ | 10,000 | |
Melissa Moschella, PhD* | | $ | 6,000 | |
Gloria Purvis** | | $ | 1,000 | |
* | Melissa Moschella began serving on the CAB in April 2017 |
** | Gloria Purvis began serving on the CAB in October 2017 |
INVESTMENT ADVISER AND OTHER SERVICE PROVIDERS
Investment Adviser. Schwartz Investment Counsel, Inc. (the “Adviser”), 801 W. Ann Arbor Trail, Plymouth, Michigan 48170, is the investment adviser for each Fund. The Adviser is responsible for managing each Fund’s investment portfolio and oversees the daily business operations of the Funds.
Administrator. Ultimus Fund Solutions, LLC (“Ultimus”) provides the Funds with administration, fund accounting and transfer agent and shareholder services. The mailing address of Ultimus is 225 Pictoria Drive, Suite 450, Cincinnati, Ohio 45246.
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Principal Underwriter. Ultimus Fund Distributors, LLC (the “Distributor”) is the Funds’ principal underwriter. The Distributor is a wholly-owned subsidiary of Ultimus. The Distributor’s mailing address is 225 Pictoria Drive, Suite 450, Cincinnati, Ohio 45246.
Annual and Semiannual Reports. The Trust will furnish, without charge, a copy of each Fund’s most recent annual and semiannual reports upon request. To request these documents, please call us at 1-888-726-9331 or write to the Trust at P.O. Box 46707, Cincinnati, Ohio 45246-0707. The annual and semiannual reports are also available on the Funds’ websites at www.schwartzvaluefocusedfund.com and www.avemariafunds.com.
Independent Registered Public Accounting Firm. The Board of Trustees, including a majority of the Independent Trustees, has selected Deloitte & Touche LLP (“D&T”) as the Trust’s independent registered public accounting firm. D&T is located at 111 South Wacker Drive, Chicago, Illinois 60606. Representatives of D&T are not expected to be present at the Meeting although they will have an opportunity to attend and to make a statement, if they desire to do so. If representatives of D&T are present at the Meeting, they will be available to respond to appropriate questions from shareholders.
The Board of Trustees has not adopted policies and procedures with regard to the pre-approval of services provided by D&T. Audit, audit-related and tax compliance services provided to the Trust on an annual basis require specific pre-approval by the Board. During the last two fiscal years, all of the services provided to the Trust were pre-approved by the Audit Committee.
Fees Billed by D&T to the Trust During the Previous Two Fiscal Years
| ● | Audit Fees. The aggregate fees billed for professional services rendered by D&T for the audit of the annual financial statements of the Trust or for services that are normally provided by D&T in connection with statutory and regulatory filings or engagements were $134,500 with respect to the fiscal year ended December 31, 2016 and $138,500 with respect to the fiscal year ended December 31, 2017. |
| ● | Audit-Related Fees. No fees were billed to the Trust in either of the last two fiscal years for assurance and related services by D&T that are reasonably related to the performance of the audit of the Trust’s financial statements and are not reported as “Audit Fees” in the preceding paragraph. |
| ● | Tax Fees. The aggregate fees billed for professional services rendered by D&T to the Trust for tax compliance, tax advice and tax planning were $17,350 with respect to the fiscal year ended December 31, 2016 and $17,850 with respect to the fiscal year ended December 31, 2017. The services comprising these fees are tax consulting and the preparation of the Trust’s federal income and excise tax returns. |
| ● | All Other Fees. No fees were billed to the Trust in either of the last two fiscal years for products and services provided by D&T, other than the services reported above. |
| ● | Non-Audit Fees Paid by the Adviser. The aggregate non-audit fees billed by D&T to the Trust’s Adviser for Global Investment Performance Standards (“GIPS”) verification services were $12,500 with respect to the fiscal year ended December 31, 2016 and $13,000 with respect to the fiscal year ended December 31, 2017. |
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The percentage of hours expended by D&T on the audit of the Trust’s financial statements for the last completed fiscal year that were attributed to work performed by individuals other than D&T full time, permanent employees was less than fifty percent.
Principal Shareholders of the Funds. The following table sets forth, as of the Record Date, the share ownership of those shareholders known by the Trust to own of record or beneficially more than 5% of the outstanding shares of a Fund.
Fund | Name and Address of Owner | Number of Shares Owned | Percentage Ownership |
Schwartz Value Focused Fund | Linda J. Baroli Trust c/o Schwartz Investment Counsel, 801 W. Ann Arbor Trail, Suite 244, Plymouth, Michigan 48170 | 160,774.424 | 18.77% |
Schwartz Value Focused Fund | George P. Schwartz Roth IRA Account c/o Schwartz Investment Counsel, 801 W. Ann Arbor Trail, Suite 244, Plymouth, Michigan 48170 | 44,972.855 | 5.25% |
Schwartz Value Focused Fund | Louis C. Argenta Living Trust c/o Schwartz Investment Counsel, 801 W. Ann Arbor Trail, Suite 244, Plymouth, Michigan 48170 | 210,064.665 | 24.53% |
Ave Maria Value Fund | Charles Schwab & Co. Inc. Special Custody Account For the Benefit of its Customers 211 Main Street San Francisco, California 94105 | 778,474.176 | 6.50% |
Ave Maria Growth Fund | Charles Schwab & Co. Inc. Special Custody Account For the Benefit of its Customers 211 Main Street San Francisco, California 94105 | 2,182,193.794 | 13.68% |
Ave Maria Rising Dividend Fund | Charles Schwab & Co. Inc. Special Custody Account For the Benefit of its Customers 211 Main Street San Francisco, California 94105 | 8,957,366.023 | 16.69% |
Ave Maria Rising Dividend Fund | National Financial Services LLC For the Benefit of State Street Bank Trust Various Retirement Plans 440 Mamaroneck Avenue Harrison, New York, 10528 | 7,189,872.580 | 13.39% |
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Fund | Name and Address of Owner | Number of Shares Owned | Percentage Ownership |
Ave Maria Rising Dividend Fund | Merrill Lynch Pierce Fenner & Smith For the Benefit of its Customers 4800 Deer Lake Drive East Jacksonville, Florida 32202 | 2,808,190.537 | 5.23% |
Ave Maria World Equity Fund | Charles Schwab & Co. Inc. Special Custody Account For the Benefit of its Customers 211 Main Street San Francisco, California 94105 | 494,521.090 | 11.92% |
Ave Maria World Equity Fund | Louis C. Argenta Living Trust c/o Schwartz Investment Counsel, 801 W. Ann Arbor Trail, Suite 244, Plymouth, Michigan 48170 | 608,641.813 | 14.67% |
Ave Maria Bond Fund | Charles Schwab & Co. Inc. Special Custody Account For the Benefit of its Customers 211 Main Street San Francisco, California 94105 | 3,727,882.727 | 13.72% |
Shareholder Proposals. As an Ohio business trust, the Trust does not intend to, and is not required to hold annual meetings of shareholders, except under certain limited circumstances. The Board of Trustees does not believe a formal process for shareholders to send communications to the Board of Trustees is appropriate due to the infrequency of shareholder communications to the Board of Trustees. The Trust has not received any shareholder proposals to be considered for presentation at the Meeting. Under the proxy rules of the SEC, shareholder proposals may, under certain conditions, be included in the Trust'sTrust’s proxy statement and proxy for a particular meeting. Under these rules, proposals submitted for inclusion in the Trust'sTrust’s proxy materials must be received by the Trust within a reasonable time before the solicitation is made. The fact that the Trust receives a shareholder proposal in a timely manner does not ensure its inclusion in its proxy materials, because there are other requirements in the proxy rules relating to such inclusion. Annual meetings of shareholders of the Trust are not required as long as there is no particular requirement under the 1940Investment Company Act or state law, which must be met by convening such a shareholder meeting. Any shareholder proposal should be sent to Wade R. Bridge,Simon H. Berry, Assistant Secretary of the Trust, 225 Pictoria Drive, Suite 450, Cincinnati, Ohio 45246.
Shareholder CommunicationsCommunicating with Trustees. the Board.Shareholders who wish tomay communicate with the Board of Trustees, or, if applicable, specified individual Trustees, should write to the Board or the particular Trustee in care of the Trust at the offices of the Trust as set forth below. All communications will be forwarded directly to the Board or the individual Trustee. Shareholders also have an opportunity to communicate with the Board at shareholder meetings. The Trust does not have a policy requiring Trustees to attend shareholder meetings.
Proxy Delivery. The Trust may only send one proxy statement to shareholders who share the same address unless the Trust has received different instructions from one or more of the shareholders. The Fund will deliver promptly to a shareholder, upon oral or written request, a separate copy of the proxy statement to a shared address to which a single copy of this Proxy was delivered. By calling orby writing the Trust, a shareholder may request separate copies of future proxy statements, or if the shareholder is receiving multiple copies of the proxy statement now, may request a single copy in the future. To request a paper or e-mail copy of the proxy statement or annual report at no charge, or to make any of the aforementioned requests, write to Schwartz Investment Trust, P.O. Box 46707, Cincinnati, Ohio 45246-0707,801 W. Ann Arbor Trail, Suite 244, Plymouth, Michigan 48170.
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OTHER BUSINESS
The proxy holders have no present intention of bringing any other matter before the Special Meeting other than those specifically referred to above or call the Trust toll-free at 1-877-632-0910matters in connection with or e-mail the Trust at fundinfo@ultimus.com.
Annual and Semiannual Reports. The Fund will furnish, without charge, a copy of its most recent annual report and most recent semi-annual report succeeding such annual report, if any, upon request. To request the annual or semi-annual report, please call us toll free at 1-888-726-0753 or write to Wade R. Bridge, Assistant Secretary, Schwartz Investment Trust, P.O. Box 46707, Cincinnati, Ohio 45246-0707. The Fund’s annual and semi-annual reports are available for download at www.schwartzvaluefocusedfund.com.
ADDITIONAL INFORMATION ON THE OPERATION OF THE FUND
Principal Underwriter. Ultimus Fund Distributors, LLC (the “Distributor”) serves as the Fund’s principal underwriter and, as such, is the exclusive agent for distribution of shares of the Fund. The Distributor is obligated to sell shares on a best efforts basis only against purchase orders for the shares. Sharespurpose of effecting the Fundsame. Neither the proxy holders nor the Board of Trustees are offeredaware of any matters which may be presented by others. If any other business shall properly come before the Special Meeting, the proxy holders intend to the public on a continuous basis. The Distributor is located at 225 Pictoria Drive, Suite 450, Cincinnati Ohio 45246.vote thereon in accordance with their best judgment.
Administration and Other Services. Ultimus Fund Solutions, LLC (“Ultimus”) provides administrative services, accounting and pricing services, and transfer agent and shareholder services to the Fund. Ultimus is located at 225 Pictoria Drive, Suite 450, Cincinnati, Ohio 45246.
| By orderOrder of the Board of Trustees |
| |
| Simon H. Berry |
| Wade R. Bridge |
May 10, 2016 | Assistant Secretary |
Date: January 17, 2018
Please complete, date and signexecute the enclosed Proxyproxy and return it promptly in the enclosed reply envelope. NO POSTAGE IS REQUIRED IF MAILED IN envelope, thus avoiding unnecessary expense and delay. No postage is necessary if mailed in the United States. The proxy is revocable and will not affect your right to vote in person if you attend the Meeting.
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APPENDIX A
SCHWARTZ INVESTMENT TRUST
CHARTER FOR NOMINATING AND GOVERNANCE COMMITTEE
THE UNITED STATES. YouCOMMITTEE
The Nominating and Governance Committee (the “Committee”) of the Board of Trustees (the “Board”) of Schwartz Investment Trust (the “Trust”) shall be composed entirely of Trustees who are not “interested persons” of the Trust or its investment adviser (“Independent Trustees”), as defined in Section 2(a)(19) of the Investment Company Act of 1940, as amended (the “1940 Act”).
BOARD NOMINATIONS AND FUNCTIONS
1. The Committee shall select and nominate all persons to serve as Independent Trustees. The Committee shall evaluate candidates’ qualifications for Board membership and the independence of such candidates from the investment advisers and other principal service providers for the funds of the Trust. Persons selected must be independent in terms of both the letter and the spirit of the 1940 Act. The Committee shall also consider the effect of any relationships beyond those delineated in the 1940 Act that might impair independence, e.g., business, financial or family relationships with investment advisers or service providers.
2. The Committee also shall evaluate the qualifications of, and make recommendations for, “interested” Trustee candidates to the Board.
3. The Committee may also voteadopt from time to time specific, minimum qualifications that the Committee believes a candidate must meet before being considered as a candidate for Board membership and shall comply with any rules adopted from time to time by the U.S. Securities and Exchange Commission regarding investment company nominating committees and the nomination of persons to be considered as candidates for Board membership.
4. The Committee shall review shareholder recommendations for nominations to fill vacancies on the Board if such recommendations are submitted in writing and addressed to the Committee at the Trust’s offices. The Committee may adopt, by resolution, a policy regarding its procedures for considering candidates for the Board, including any recommended by shareholders.
5. The Committee shall periodically review Independent Trustee compensation and shall recommend any appropriate changes in compensation to the Independent Trustees as a group.
6. The Committee shall oversee arrangements for orientation of new Independent Trustees, and continuing education for Independent Trustees.
7. The Committee shall oversee the governance processes and activities of the Board, including the conduct of Board meetings and the nature and organization of materials prepared for Board meetings.
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COMMITTEE NOMINATIONS AND FUNCTIONS
1. The Committee has the authority to make recommendations to the full Board for nomination for membership on any committees of the Board.
2. The Committee has the authority to make recommendations to the full Board for any policy for retirement from Board membership.
3. The Committee has the authority to review as necessary the responsibilities of any committees of the Board, whether there is a continuing need for each committee, whether there is a need for additional committees of the Board, and whether committees should be combined or reorganized. The Committee shall make recommendations for any such action to the full Board.
OTHER POWERS AND RESPONSIBILITIES
1. The Committee shall meet on a regular basis in open or executive sessions. The Committee may invite members of management, counsel, advisers and others to attend its meetings as it deems appropriate. The Committee shall have separate sessions with management and others, as and when it deems appropriate.
2. The Committee shall have the authority to assess and determine whether counsel to the Independent Trustees is “independent legal counsel” as defined by Rule 0-1(a)(6) under the 1940 Act.
3. The Committee shall have the resources and authority appropriate to discharge its responsibilities, including authority to retain special counsel and other experts or consultants at the expense of the Trust.
4. The Committee shall maintain minutes of its meetings and report its activities to the Board on a regular basis and make such recommendations as the Committee may deem necessary or appropriate.
5. A majority of the members of the Committee shall constitute a quorum for the transaction of business at any meeting of the Committee. The action of a majority of the members of the Committee present at a meeting at which a quorum is present shall be the action of the Committee. The Committee may meet in person or by telephone, or throughand the InternetCommittee may act by followingwritten consent, to the instructions on your proxy card.