SCHEDULE 14A
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. _____________)
Filed by the Registrant [X]
Filed by a Party other than the Registrant [_]
Check the appropriate box:
[X] Preliminary Proxy Statement
[_] Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
[_] Definitive Proxy Statement
[_] Definitive Additional Materials
[_] Soliciting Material Pursuant to ss. 240.14a-11(c) or ss. 240.14a-12
Great Hall Investment Funds, Inc.
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(Name of Registrant as Specified in its Charter)
(specify)
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(Name of Person(s) Filing Proxy Statement if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
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Item 22(a)(2) of Schedule 14A.
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(1) Title of each class of securities to which transaction applies:
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filing fee is calculated and state how it was determined):
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paid previously. Identify the previous filing by registration statement
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(1) Amount Previously Paid:
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[EFFECTIVE DATE]
Dear Shareholder:
As a shareholder in a Great Hall fund, you are being asked to vote on several
important matters that would affect your fund. These matters will be considered
at a special meeting of shareholders of your fund, which has been scheduled for
March 15, 2004.
As part of a broader integration initiative, you are being asked to approve the
reorganization of your fund as a separate series of the Tamarack Funds Trust.
The reorganization would be accomplished through a Reorganization transaction
that has been approved by your fund's Board. If you and your fellow shareholders
approve the Reorganization, your fund would be reorganized as a Tamarack Fund on
or about March 31, 2004. The Reorganization would consist of the transfer of all
of the assets of your fund to the corresponding Tamarack Fund in exchange for
shares of the Tamarack Fund, the assumption by the Tamarack Fund of all
liabilities of your fund, and the distribution of Tamarack Fund shares to the
accounts of the shareholders of your fund in complete liquidation of your fund.
The total net asset value of your shares in the Tamarack Fund would be the same
as the total net asset value of your shares in your fund. Voyageur, the
investment advisor to both your fund and the Tamarack Funds, is paying all of
the ordinary costs of the Reorganization and the transaction is expected to
qualify as a tax-free reorganization for federal income tax purposes.
You are also being asked to elect nine nominees to serve on the board of
directors of your fund. In addition, you are being asked to approve the
modification of your fund's fundamental investment polices/restrictions.
Furthermore, shareholders of certain Great Hall funds are being asked to approve
the reclassification as non-fundamental of certain investment
policies/restrictions that are no longer legally required to be classified as
fundamental. These changes are intended to streamline and make uniform the
policies/restrictions applicable to all funds in order to promote ease of
administration of the investment program of each fund and to modernize the
investment limitations currently applicable to the funds. Furthermore, you are
being asked to ratify the Board's selection of Deloitte & Touche LLP as the
independent auditors of your fund for the current fiscal year.
The enclosed materials include detailed information about these four proposals.
To assist you in understanding these proposals we have provided a Definitions of
Key Terms page and a Questions and Answers section.
As a valued shareholder, your vote is very important. Please review the enclosed
materials carefully. After reviewing the materials, please complete, date and
sign the enclosed proxy card(s), and return it in the postage-paid,
self-addressed envelope. Please be aware that if you hold shares in more than
one account, you may receive more than one proxy package. Separate proxy cards
are required for each account. If you would like to attend the shareholder
meeting, you may vote your shares in person. If you expect to attend the
meeting, please notify us in advance by calling [TELEPHONE NUMBER].
Alternatively, you may vote your shares by telephone, by following the
instructions on your proxy card(s). Because your vote is important, if we have
not heard from you by [February 20, 2004], you may be contacted by [a
representative of Voyageur or [SOLICITOR NAME]].
If you have any questions, please call your fund's toll-free number (800)
934-6674, and ask to speak with a representative, who will be happy to help you.
Sincerely,
Jennifer Lammers
President
DEFINITIONS OF KEY TERMS
USED IN THE QUESTIONS & ANSWERS
AND LETTER TO SHAREHOLDERS
BOARD: The current board of directors of Great Hall
Investment Funds, Inc. The members of the Board may
change if shareholders of Great Hall Investment
Funds, Inc. approve the proposal described in the
enclosed materials to elect a new board of directors.
Shareholders of the other funds are being asked to
elect the same new board of directors for their
funds. The independent directors nominated to serve
on the new boards of directors have been selected
from among the independent directors currently
serving on the boards of Great Hall Investment Funds,
Inc. and the other funds.
INTEGRATION INITIATIVE: Voyageur's effort to integrate its financial services
operations by simplifying the existing lineup of
funds and standardizing current investment
operations. Specifically, this involves reducing the
number of funds (by combining similar portfolios),
closing under-performing portfolios, and simplifying
administration by integrating the funds under a
single legal entity and a single board of trustees. A
final step is to rename all the funds with a common
name, the Tamarack Funds. This renaming will allow
the funds' distributor to provide improved marketing
and sales support to the funds by focusing resources
on supporting a single name in the marketplace.
PLAN: The Agreement and Plan of Reorganization under which
your fund would be reorganized as a separate
portfolio of the Tamarack Funds Trust.
REORGANIZATION: The proposed reorganization of your fund as a
separate portfolio of the Tamarack Funds Trust, which
would be accomplished through a reorganization
transaction that would be carried out in accordance
with the terms of the Plan.
TAMARACK FUNDS TRUST: The new legal entity (a Delaware statutory trust)
under which Voyageur has proposed to integrate all
the funds as separate portfolios of this trust.
Organizing as a Delaware statutory trust is a common
legal structure for mutual fund companies. As
mentioned above, the Tamarack Funds would become the
new name for the funds if the Integration Initiative
proposals are approved.
THE FUNDS: The Babson Group of Funds, the Great Hall Funds, the
J&B Funds and the RBC Funds are a collection of
twenty-two individual mutual funds and/or portfolios.
Voyageur serves as investment advisor to all of these
funds and portfolios.
THE GREAT HALL FUNDS: Great Hall Prime Money Market Fund, Great Hall U.S.
Government Money Market Fund, Great Hall Tax-Free
Money Market Fund, Great Hall Institutional Prime
Money Market Fund, and Great Hall Institutional
Tax-Free Money Market Fund. Each is a separate
portfolio of Great Hall Investment Funds, Inc.
VOYAGEUR: Voyageur Asset Management Inc. is an SEC registered
investment advisor and subsidiary of RBC Dain
Rauscher Corporation, currently serving as advisor to
your fund and all the funds. For over 20 years,
Voyageur has provided equity, fixed income and
balanced asset management services to clients
throughout the U.S. and in Canada. Currently,
Voyageur manages client assets totaling over $23
billion.
YOUR FUND: The Great Hall fund in which you currently hold
shares.
IMPORTANT NEWS FOR
SHAREHOLDERS OF THE GREAT HALL FUNDS
You are being asked to consider several proposals to be voted upon at an
upcoming shareholder meeting of your fund. A brief overview of these proposals
and related matters is provided below. We suggest that you review the
Definitions of Key Terms page before reading the information below. In addition,
we encourage you to read the full text of the enclosed Proxy Statement before
voting.
Q & A: QUESTIONS AND ANSWERS
Q: WHAT IS HAPPENING?
A: Voyageur, your fund's investment advisor, currently serves as the
investment advisor for twenty-two individual mutual funds or
portfolios. Among these twenty-two funds, there is some duplication of
investment objectives and administrative requirements. Voyageur has
undertaken an initiative to simplify the existing fund lineup and
reduce the administrative burden of these overlapping requirements.
Voyageur believes that this will allow your fund and all the funds for
which it serves as investment advisor to be more efficiently
administered. Voyageur also believes that combining certain funds with
comparable investment objectives will either reduce shareholder
expenses or maintain them at the current levels. Therefore, Voyageur
has recommended, and the boards of directors/trustees of the funds have
approved, certain changes, which include: (1) standardizing the
fundamental investment restrictions for the funds, (2) creating a
single board of directors/trustees for the funds, (3) combining certain
funds that have similar investment objectives, (4) liquidating certain
funds that have not grown as quickly as originally anticipated and that
are not expected to attract substantial assets in the future, and (5)
simplifying the organizational structure for the funds by reorganizing
all of the funds (other than those that are being liquidated or
combined into other funds) into a single legal entity to be named the
Tamarack Funds Trust.
As part of this integration initiative, Voyageur has proposed, and your
fund's Board has approved, the reorganization of your fund as a
separate series of the Tamarack Funds Trust. This would be accomplished
through the proposed Reorganization. Also as part of this integration
initiative, your fund's Board has nominated nine individuals to serve
on the Board. These same individuals are being nominated to serve on
the boards of directors/trustees for each of the other funds so that a
single, unitary board of directors/trustees would be elected for all of
the funds. The independent directors/trustees nominated to serve on the
unitary board have been selected from among the independent
directors/trustees currently serving on the boards of the funds. In
addition, as part of this initiative, your fund's Board is recommending
that shareholders approve the modification of your fund's fundamental
investment policies/restrictions in order to streamline and make
uniform the policies/restrictions applicable to all the funds. These
modifications are intended to promote ease of administration of the
investment program of each fund and to modernize the investment
limitations currently applicable to each fund.
Q: WHAT AM I BEING ASKED TO VOTE ON?
A: You are asked to vote in favor of four proposals:
Proposal 1: The election of each of the nine individuals nominated to
serve on the Board of Directors of Great Hall Investment
Funds, Inc.;
Proposal 2: The approval of the Plan, which would result in your
fund being reorganized as a separate series of the Tamarack
Funds Trust through the Reorganization;
Proposal 3: The approval of the modification of your fund's
fundamental investment policies/restrictions; and
Proposal 4: The ratification of the selection of Deloitte & Touche
LLP as independent auditors of your fund.
Q: HOW DOES MY FUND'S BOARD RECOMMEND THAT I VOTE?
A: After carefully considering the proposals, your fund's Board
unanimously recommends that you vote FOR the nominees listed in
Proposal 1 and FOR Proposals 2, 3 and 4.
Q: WHY HAS MY FUND'S BOARD RECOMMENDED THAT I VOTE IN FAVOR OF THE
REORGANIZATION?
A: After carefully considering the Reorganization proposal, your fund's
Board determined that it is advisable and in the best interests of your
fund and its shareholders. In reaching this determination, the Board
considered multiple factors, including: (1) Voyageur has informed the
Board that it believes that by reorganizing your fund and the other
funds as separate series of a single entity, the Tamarack Funds Trust,
the funds should be able to realize greater operating efficiencies; (2)
Voyageur has informed the Board that it believes that the proposed
Delaware statutory trust form provides a cost efficient and flexible
method of operating your fund for the benefit of its shareholders; (3)
the terms of the current expense limitation agreement for your fund,
which is in place through November 30, 2004, would continue to be
applied to the corresponding Tamarack Fund; (4) your fund will not bear
any ordinary costs of the Reorganization; (5) the investment objective
of your fund will be identical to that of the corresponding Tamarack
Fund, and the Tamarack Fund will be managed by the same personnel and,
with a few exceptions that are the subject of Proposal 3, in accordance
with the same investment strategies and techniques utilized in the
management of your fund immediately prior to the Reorganization; (6)
shareholders of your fund will continue to receive the same level of
services currently provided by your fund; (7) the Reorganization is
intended to be tax-free for federal income tax purposes; and (8)
shareholders' ownership interests will not be diluted as a result of
the Reorganization.
Q: WHEN WOULD THE REORGANIZATION OF MY FUND AS A SERIES OF THE TAMARACK
FUNDS TRUST TAKE PLACE?
A: It is expected that the Reorganization would occur on March 31, 2004.
You would receive notice of any material changes to this schedule.
Q: WOULD THE REORGANIZATION AFFECT MY ACCOUNT VALUE?
A: The value of your fund account would not change as a result of the
Reorganization. Shares of your fund would be exchanged for shares of
the corresponding Tamarack Fund in the Reorganization. The total value
of the shares you hold will not be affected. The value of your
investment would be the same immediately before and after the
Reorganization.
Q: WHO WOULD PAY FOR THE REORGANIZATION?
A: Voyageur has agreed to bear all ordinary costs and expenses of the
Reorganization, and there are not expected to be any extraordinary
costs or expenses. Any costs incurred by an individual shareholder,
such as traveling to the shareholder meeting or seeking personal
financial advice, would be the individual shareholder's responsibility.
Q: WHY AM I BEING ASKED TO ELECT A NEW BOARD OF DIRECTORS FOR GREAT HALL
INVESTMENT FUNDS, INC.?
A: You are being asked to vote in favor of this proposal in case the
Reorganization is not approved. If the Reorganization is approved, the
board of trustees of the Tamarack Funds Trust will oversee the
operations of the Tamarack Funds. The composition of the board of
trustees of the Tamarack Funds Trust would be the same as the board of
directors you are being asked to approve for Great Hall Investment
Funds, Inc.
A mutual fund's board of directors/trustees represents shareholder
interests and oversees the management and operations of the fund. As
part of the broader integration initiative to simplify the existing
fund lineup and standardize key elements of current investment
operations, which is mentioned above, Voyageur has proposed the
creation of a single board of directors/trustees for all of the funds
managed by Voyageur. Your fund's Board of Directors has voted in favor
of this proposal and has nominated nine individuals to serve on the
unitary board. Information about each nominee is contained in the
enclosed Proxy Statement. You are being asked to approve the election
of each of these nine individuals to the Board. Your fund's Board
believes that a unitary board of directors/trustees for all of the
funds has the potential to increase efficiencies and enhance the
effectiveness of governance.
Q: WHY AM I BEING ASKED TO APPROVE CHANGES TO MY FUND'S INVESTMENT
POLICIES/RESTRICTIONS?
A: The proposed changes to your fund's fundamental investment
policies/restrictions are intended to streamline and make uniform the
policies/restrictions applicable to all of the funds in order to
promote ease of administration of the investment program of each fund
and to modernize the investment limitations currently applicable to
each fund.
Q: WHERE CAN I OBTAIN ADDITIONAL INFORMATION ABOUT THESE FOUR PROPOSALS?
A: The proposals are discussed in more detail in the enclosed Proxy
Statement, which we encourage you to read. If you have any questions
about the matters discussed in the enclosed materials or need
assistance completing your proxy card(s), please call [PROXY SOLICITOR
TELEPHONE NUMBER].
GREAT HALL INVESTMENT FUNDS, INC.
---------------------------------
GREAT HALL PRIME MONEY MARKET FUND
GREAT HALL U.S. GOVERNMENT MONEY MARKET FUND
GREAT HALL TAX-FREE MONEY MARKET FUND
GREAT HALL INSTITUTIONAL PRIME MONEY MARKET FUND
GREAT HALL INSTITUTIONAL TAX-FREE MONEY MARKET FUND
60 SOUTH SIXTH STREET
MINNEAPOLIS, MINNESOTA 55402
(800) 934-6674
------------
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
TO BE HELD ON MARCH 15, 2004
NOTICE IS HEREBY GIVEN that a special meeting of the shareholders ("Meeting") of
Great Hall Prime Money Market Fund, Great Hall U.S. Government Money Market
Fund, Great Hall Tax-Free Money Market Fund, Great Hall Institutional Prime
Money Market Fund, Great Hall Institutional Tax-Free Money Market Fund (each a
"Fund," and collectively the "Funds"), the separate series of Great Hall
Investment Funds, Inc. (the "Company"), will be held at the offices of RBC Dain
Rauscher Corporation, 60 South Sixth Street, Minneapolis, Minnesota at 9:00 a.m.
Central Time, for the following purposes:
PROPOSAL 1: To approve the election of each of the nine individuals nominated to
serve on the Board of Directors of the Company;
PROPOSAL 2: To approve an Agreement and Plan of Reorganization, pursuant
to which each Fund would be reorganized as a separate portfolio of
the Tamarack Funds Trust, a newly-created Delaware statutory trust;
PROPOSAL 3: To approve the modification or reclassification as non-fundamental
of certain of the Funds' fundamental investment
policies/restrictions in order to modernize such investment
policies/restrictions and increase the Funds' investment
flexibility; and
PROPOSAL 4: To ratify the selection of Deloitte & Touche LLP as the independent
auditors of the Funds for the current fiscal year.
The attached Proxy Statement provides additional information about these
proposals. Shareholders of record of a Fund as of the close of business on
January 15, 2004 are entitled to vote at the Meeting and any adjournment(s) or
postponement(s) thereof. Whether or not you plan to attend the Meeting in
person, please vote your shares. In addition to voting by mail, you may also
vote by telephone, as follows:
TO VOTE BY TELEPHONE:
=================================================
(1) Read the Proxy Statement and have your proxy
card at hand.
(2) Call the toll-free 1-[800/888] number that
appears on your proxy card.
(3) Enter the control number set forth on the
proxy card and follow the instructions.
-------------------------------------------------
We encourage you to vote by telephone using the control number that appears on
your enclosed proxy card. Voting by telephone will reduce the time and costs
associated with this proxy solicitation. Whichever method of voting you choose,
please read the enclosed Proxy Statement carefully before you vote.
The persons named as proxies will vote in their discretion on any other business
that may properly come before the Meeting or any adjournments or postponements
thereof.
If the necessary quorum to transact business or the vote required to approve any
proposal is not obtained at the Meeting, the persons named as proxies may
propose one or more adjournments of the Meeting in accordance with applicable
law to permit further solicitation of proxies. Any adjournment as to a matter
being voted on by shareholders of the Funds collectively will require the
affirmative vote of the holders of a majority of the Funds' shares present in
person or by proxy at the Meeting. Any adjournment as to a matter being voted on
by the shareholders of an individual Fund will require the affirmative vote of
the holders of a majority of that individual Fund's shares present in person or
by proxy at the Meeting. The persons named as proxies will vote FOR any such
adjournment those proxies which they are entitled to vote in favor of that
Proposal and will vote AGAINST any such adjournment those proxies to be voted
against that Proposal.
PLEASE RESPOND -- WE ASK THAT YOU VOTE PROMPTLY IN ORDER TO AVOID
THE ADDITIONAL EXPENSE OF FURTHER SOLICITATION.
YOUR VOTE IS IMPORTANT.
By Order of the Board of Directors,
Laura Moret
[EFFECTIVE DATE] Secretary
GREAT HALL INVESTMENT FUNDS, INC.
---------------------------------
GREAT HALL PRIME MONEY MARKET FUND ("PRIME FUND")
GREAT HALL U.S. GOVERNMENT MONEY MARKET FUND ("GOVERNMENT FUND")
GREAT HALL TAX-FREE MONEY MARKET FUND ("TAX-FREE FUND")
GREAT HALL INSTITUTIONAL PRIME MONEY MARKET FUND ("INSTITUTIONAL PRIME FUND")
GREAT HALL INSTITUTIONAL TAX-FREE MONEY MARKET FUND ("INSTITUTIONAL TAX-FREE
FUND")
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PROXY STATEMENT
---------------------------
SPECIAL MEETING OF SHAREHOLDERS
TO BE HELD ON MARCH 15, 2004
This document is a proxy statement (the "Proxy Statement"). This Proxy Statement
is being furnished to shareholders of Prime Fund, Government Fund, Tax-Free
Fund, Institutional Prime Fund and Institutional Tax-Free Fund (each a "Fund,"
and collectively the "Funds"), each of which is a separate series/portfolio of
Great Hall Investment Funds, Inc. (the "Company") in connection with four
proposals ("Proposals"). This Proxy Statement sets forth concisely the
information that shareholders should know in order to evaluate the Proposals.
Voyageur Asset Management Inc. ("Voyageur") is the Funds' investment advisor. On
May 1, 2003, Jones & Babson, Inc. ("J&B") was acquired by RBC Dain Rauscher
Corporation. At the time of this acquisition, J&B was the investment advisor for
the Babson and J&B families of mutual funds. Subsequent to the acquisition, J&B
became an affiliate of Voyageur. Like J&B, Voyageur is also a subsidiary of RBC
Dain Rauscher Corporation and a registered investment advisor. On December 31,
2003, for ease of administration, RBC Dain Rauscher Corporation consolidated the
investment advisory activities of its two subsidiaries (Voyageur and J&B) into a
single entity, which continues to use the Voyageur name. In addition to the
Funds, Voyageur currently serves as the investment advisor for RBC Funds, Inc.,
J&B Funds, and each of the funds constituting the Babson Group of Funds -- a
collection of twenty-two individual mutual funds and/or portfolios ("funds").
Voyageur has undertaken an initiative to integrate its financial services
operations by simplifying the existing fund lineup and standardizing key
elements of current investment operations (the "integration initiative").
Voyageur believes that this will allow the Funds and all the funds for which
Voyageur serves as investment advisor to be more efficiently administered.
Voyageur also believes that combining certain funds with comparable investment
objectives will either reduce shareholder expenses or maintain them at the
current levels. As part of this integration initiative, Voyageur has
recommended, and the boards of directors/trustees of the applicable funds have
approved, the following changes: (1) standardizing the fundamental investment
restrictions for the funds, (2) creating boards of directors/trustees for the
funds with uniform members, (3) combining certain funds that have similar
investment objectives and policies, (4) liquidating certain funds that have not
grown as quickly as originally anticipated and that are not expected to attract
substantial assets in the future, and (5) simplifying the organizational
structure for the funds by reorganizing all of the funds (other than those which
are being liquidated or combined into other funds) into portfolios of a single
legal entity to be named the Tamarack Funds Trust. The Tamarack Funds Trust
would be organized as a Delaware statutory trust, a common form of organization
for mutual funds, and would consist of seventeen separate portfolios. The funds
would be referred to as the Tamarack Funds.
The following Proposals will be considered and acted upon at the Meeting:
PROPOSAL FUND(S) AFFECTED PAGE
==============================================================================================================
1. To approve the election of each of the nine individuals ALL FUNDS [ ]
nominated to serve on the Board of Directors of the
Company.
2. To approve an Agreement and Plan of Reorganization, pursuant ALL FUNDS [ ]
to which each Fund would be reorganized as a separate portfolio
of Tamarack Funds Trust, a newly-created Delaware statutory trust.
3. To approve the modification/reclassification of certain [ ]
fundamental investment policies/restrictions
Modification of policies that must remain fundamental:
3.A Diversification PRIME FUND, GOVERNMENT FUND,
TAX-FREE FUND
3.B Borrowing ALL FUNDS
3.C Senior Securities ALL FUNDS
3.D Underwriting Securities ALL FUNDS
3.E Real Estate ALL FUNDS
3.F Making Loans ALL FUNDS
3.G Concentration of Investments ALL FUNDS
3.H Commodities ALL FUNDS
Reclassification of certain fundamental investment
restrictions as non-fundamental:
3.I Pledging, Mortgaging and Hypothecating Fund Assets PRIME FUND, GOVERNMENT FUND,
TAX-FREE FUND
3.J Investments for Control PRIME FUND, GOVERNMENT FUND,
TAX-FREE FUND
3.K Investments in Other Investment Companies PRIME FUND, GOVERNMENT FUND,
TAX-FREE FUND
3.L Writing and Selling Options PRIME FUND, GOVERNMENT FUND,
TAX-FREE FUND
3.M Margin Activities and Short Selling PRIME FUND, GOVERNMENT FUND,
TAX-FREE FUND
3.N Unseasoned Companies PRIME FUND, GOVERNMENT FUND,
TAX-FREE FUND
3.O Investments in Equity Securities PRIME FUND, GOVERNMENT FUND,
TAX-FREE FUND
3.P Investments in Non-Municipal Obligations. TAX-FREE FUND
4. To ratify the selection of Deloitte & Touche LLP as the ALL FUNDS [ ]
independent auditors of the Funds for the current fiscal year.
The Board, on behalf of each Fund, is soliciting proxies from shareholders of
the Funds for the special meeting of shareholders to be held on March 15, 2004,
at the offices of RBC Dain Rauscher Corporation, 60 South Sixth Street,
Minneapolis, Minnesota, at 9:00 a.m. Central Time, and at any and all
adjournment(s) or postponement(s) thereof (the "Meeting"). This Proxy Statement,
the Notice of Special Meeting and the proxy card(s) are first being mailed to
shareholders on or about January 22, 2004, or as soon as practicable thereafter.
2
This Proxy Statement should be kept for future reference. The most recent annual
report of each Fund, including financial statements, for the fiscal year ended
July 31, 2003 has been mailed previously to shareholders. If you would like to
receive additional copies of these shareholder reports free of charge, or copies
of any subsequent shareholder report, please contact the Company by writing to
the address set forth on the first page of this proxy statement or by calling
(800) 934-6674. Shareholder reports will be sent by first class mail within
three business days of the receipt of the request.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS
THAT SHAREHOLDERS VOTE FOR THE NOMINEES LISTED IN PROPOSAL 1
AND FOR PROPOSALS 2, 3 AND 4.
3
---------------------------
PROPOSAL 1 -- ALL FUNDS
ELECTION OF THE DIRECTORS
---------------------------
The purpose of this proposal is to elect a Board of Directors for the Company in
case the Plan, as described in Proposal 2, is not approved by shareholders of
each Fund. It is intended that the enclosed proxy will be voted for the election
as Directors of the Company of the nine nominees listed below ("Nominees").
Three of the Nominees named below are currently Directors of the Company and
each has served in that capacity since originally elected or appointed.
In order to create uniform boards of directors/trustees for all of the funds
advised by Voyageur, the same Nominees are also being proposed for election to
the boards of directors/trustees of the other funds involved in the proposed
reorganization described below in Proposal 2 (the "Reorganization"). If the
Reorganization takes place, the Nominees will be nominated to serve as the
Trustees of the Tamarack Funds Trust. The Report of the Advisory Group on Best
Practices for Fund Directors issued in 1999 by the Investment Company Institute
recommends that mutual fund boards of directors generally be organized either as
a unitary board for all the funds in a complex or as cluster boards for groups
of funds within a complex, rather than as separate boards for each individual
fund.
THE NOMINEES TO THE BOARD
Information about the Nominees, including their business addresses, ages and
principal occupations during the past five years, and other current
directorships of publicly traded companies or funds, are set forth in the table
below. A Nominee is deemed to be "independent" to the extent the Nominee is not
an "interested person" of the Company, as that term is defined in Section
2(a)(19) of the Investment Company Act of 1940, as amended ("1940 Act"). For
purposes of this Proxy Statement, "Fund Complex" means: the series of the
Company; the series of RBC Funds, Inc.; the series of J&B Funds; the series of
Investors Mark Series Fund, Inc.; Babson Enterprise Fund, Inc.; Babson
Enterprise Fund II, Inc.; Babson-Stewart Ivory International Fund, Inc.; Babson
Value Fund, Inc.; David L. Babson Growth Fund, Inc.; the series of D.L. Babson
Bond Trust; D.L. Babson Money Market Fund, Inc.; D.L. Babson Tax-Free Income
Fund, Inc. and Shadow Stock Fund, Inc.
NUMBER OF
PORTFOLIOS
IN FUND
COMPLEX(2) OTHER
POSITION(S) TERM OF OFFICE PRINCIPAL OCCUPATION(S) OVERSEEN DIRECTORSHIPS
NAME, ADDRESS(1) WITH THE AND LENGTH OF DURING BY HELD BY
AND AGE COMPANY TIME SERVED PAST 5 YEARS NOMINEE NOMINEE
================================================================================================================================
INDEPENDENT NOMINEES
T. Geron Bell Director Indefinite(3); President of Twins Sports, Inc. 25(5) None
34 Kirby Puckett Place since 1993 (the parent company of Minnesota
Minneapolis, Minnesota 55415 Twins and Victory Sports)
Age: 62 since November, 2002; prior thereto
President of the Minnesota Twins
Baseball Club Incorporated since 1987.
4
NUMBER OF
PORTFOLIOS
IN FUND
COMPLEX(2) OTHER
POSITION(S) TERM OF OFFICE PRINCIPAL OCCUPATION(S) OVERSEEN DIRECTORSHIPS
NAME, ADDRESS(1) WITH THE AND LENGTH OF DURING BY HELD BY
AND AGE COMPANY TIME SERVED PAST 5 YEARS NOMINEE NOMINEE
================================================================================================================================
Ronald James Director Indefinite(3); President and Chief Executive Officer, 25(5) None
Age: 52 since 1992 Center for Ethical Business Cultures
since 2000; President and Chief
Executive Officer of the Human
Resources Group, a division of
Ceridian Corporation, from 1996-1998.
Ceridian Corporation is an information
services company specializing in
human resources outsourcing solutions.
Jay H. Wein Director Indefinite(3); Independent investor and business 25(5) None
5305 Elmridge Circle since 1991 consultant since 1989.
Excelsior, Minnesota 55331
Age: 71
Lucy Hancock Bode Nominee Indefinite(3) Lobbyist. 6(4) None
2518 White Oak Road
Raleigh, North Carolina 27609
Age: 51
Leslie H. Garner, Jr. Nominee Indefinite(3) President, Cornell College. 6(4) None
600 First Street
West Mount Vernon, Iowa 52314-1098
Age: 53
John A. MacDonald Nominee Indefinite(3) CIO, Hall Family Foundation. 1(6) None
P.O. Box 419580
Mail Drop 323
Kansas City, Missouri 64141
Age: 54
H. David Rybolt Nominee Indefinite(3) Consultant, HDR Associates, 18(7) None
6501 W. 66th Street (management consulting).
Overland Park, Kansas 66202
Age: 61
James R. Seward Nominee Indefinite(3) Private Investor/Consultant, 10(8) Director,
Age: 51 2000 to present; Financial Syntroleum
Consultant, Seward & Corp., Lab One,
Company, LLC 1998-2000. Inc., Concorde
Career Colleges.
5
NUMBER OF
PORTFOLIOS
IN FUND
COMPLEX(2) OTHER
POSITION(S) TERM OF OFFICE PRINCIPAL OCCUPATION(S) OVERSEEN DIRECTORSHIPS
NAME, ADDRESS(1) WITH THE AND LENGTH OF DURING BY HELD BY
AND AGE COMPANY TIME SERVED PAST 5 YEARS NOMINEE NOMINEE
================================================================================================================================
INTERESTED NOMINEE
Michael T. Lee(9) Nominee Indefinite(3) Chief Operating Officer and None Director, Royal
Age: 40 Senior Vice President, Voyageur, Bank of Canada.
2003 to present; Senior
Portfolio Manager, Voyageur,
2000 to present; Vice President,
Senior Research Analyst and Equity
Portfolio Manager, Voyageur, 1999 - 2003.
- ----------
(1) Unless otherwise specified, the address of each Director/Nominee is 90
South Seventh Street, Suite 4300, Minneapolis, Minnesota 55402.
(2) The Tamarack Funds Trust consists of 17 "shell" series as of the date of
this Proxy Statement. The Tamarack Funds Trust was formed solely for the
purposes of completing the Reorganization. Accordingly, the series of the
Tamarack Funds Trust have not been included in the totals in this column.
(3) The Director/Nominee may serve until his or her resignation, removal or
disqualification.
(4) Director of RBC Funds, Inc., which consists of six series.
(5) Director of Great Hall Investment Funds, Inc., which consists of five
series. Director/Trustee of each of the nine Babson Funds, one of which
consists of two series. Director of Investors Mark Series Fund, Inc.,
which consists of nine series. Trustee of J&B Funds, which consists of a
single series, J&B Small-Cap International Fund.
(6) Trustee of J&B Funds, which consists of a single series, J&B Small-Cap
International Fund.
(7) Director/Trustee of each of the Babson Funds except Babson-Stewart Ivory
International Fund, Inc. Director of Investors Mark Series Fund, Inc.,
which consists of nine series.
(8) Trustee of J&B Funds, which consists of a single series, J&B Small-Cap
International Fund; also, Director, Investors Mark Series Fund, Inc.,
which consists of nine series.
(9) Mr. Lee is an "interested person" of the Funds as defined in the 1940 Act.
He is an officer of Voyageur, the Funds' investment advisor.
EXECUTIVE OFFICERS
Officers of the Company are elected by the Board of Directors to oversee the
day-to-day activities of each Fund. Information about the executive officers of
the Company, including their principal occupations during the past five years,
are set forth in EXHIBIT B. Each of these officers are also officers and/or
employees of Voyageur.
SHARE OWNERSHIP
As of [DATE], the Nominees, Directors and officers of the Company beneficially
owned as a group less than 1% of the outstanding shares of each series of the
Company, except as follows:
6
NAME AMOUNT AND NATURE OF
OF BENEFICIAL OWNER/FUND RECORD OR BENEFICIAL OWNERSHIP PERCENT OF SERIES/CLASS
=====================================================================================================
[Insert executive officers,
directors, nominees as needed]
The following table sets forth the aggregate dollar range of equity securities
owned by each Nominee of each Fund and of all funds in the Fund Complex as of
December 31, 2003. The information as to beneficial ownership is based on
statements furnished by each Nominee.
AGGREGATE DOLLAR RANGE OF EQUITY
SECURITIES IN ALL REGISTERED INVESTMENT
COMPANIES OVERSEEN OR TO BE OVERSEEN BY
DOLLAR RANGE OF EQUITY DIRECTOR/NOMINEE IN FAMILY OF INVESTMENT
SECURITIES IN THE FUNDS COMPANIES
==========================================================================================================
INDEPENDENT NOMINEES
T. Geron Bell $[ ]
[Name of Great Hall fund] $[ ]
Lucy Hancock Bode $[ ]
[Name of Great Hall fund] $[ ]
Leslie H. Garner, Jr. $[ ]
[Name of Great Hall fund] $[ ]
Ronald James $[ ]
[Name of Great Hall fund] $[ ]
John A. MacDonald $[ ]
[Name of Great Hall fund] $[ ]
H. David Rybolt $[ ]
[Name of Great Hall fund] $[ ]
James R. Seward $[ ]
[Name of Great Hall fund] $[ ]
Jay H. Wein $[ ]
[Name of Great Hall fund] $[ ]
INTERESTED NOMINEE
Michael T. Lee $[ ]
[Name of Great Hall fund] $[ ]
All of the current Directors of the Company are considered not to be "interested
persons" of the Company, as that term is defined in the 1940 Act ("Independent
Directors"). During the fiscal year ended July 31, 2003, the Board of Directors
met [NUMBER] times. It is expected that the Board will meet at least quarterly
at regularly scheduled meetings.
COMPENSATION
The annual compensation of each Director is $12,000 plus $3,500 for each
regularly scheduled meeting attended (in-person or telephonically) and $1,000
for each special telephonic meeting attended.
7
The following table summarizes the compensation paid to the Directors of the
Company, including committee fees, for the twelve-month period ended July 31,
2003.
AGGREGATE COMPENSATION PENSION OR RETIREMENT
FOR THE COMPANY BENEFITS ACCRUED AS PART OF ESTIMATED ANNUAL BENEFITS TOTAL COMPENSATION FOR FUND
NAME OF DIRECTOR (6 FUNDS) FUND EXPENSES UPON RETIREMENT COMPLEX PAID TO DIRECTOR
====================================================================================================================================
T. Geron Bell $31,000 None None $[ ]
Sandra J. Hale $31,000 None None $[ ]
Ronald James $31,000 None None $[ ]
Jay H. Wein $31,000 None None $[ ]
To facilitate the creation of a unitary board of directors/trustees as part of
the integration initiative discussed above, certain Independent Directors agreed
not to stand for re-election. Independent Directors are not entitled to benefits
under any pension or retirement plan. However, the Board determined that,
particularly given the benefits that would accrue to the Funds from the creation
of unitary boards of directors/trustees, it was appropriate to provide the one
Independent Director who is not standing for re-election a one-time benefit.
Given that Voyageur will also benefit from the administrative efficiencies of
unitary boards of directors/trustees, Voyageur has agreed to bear the costs of
this one-time benefit. The amount of the benefit being paid to Ms. Hale is
$13,250 in the aggregate for all of the Babson Funds, the J&B Funds, and the
Great Hall Funds for which she serves as an independent director/trustee.
STANDING COMMITTEES
The Company has a standing Audit Committee currently consisting of the
Independent Directors.
As set forth in its charter, the primary duties of the Company's Audit Committee
are: (1) to evaluate the performance and compensation of the independent
auditors and make recommendations to the Board regarding the selection of
independent auditors; (2) to review communications concerning the independence
of the auditors, including the auditors' specific representations as to their
independence; (3) to meet with the Funds' independent auditors to review the
arrangements for, procedures to be utilized, staffing and scope of the annual
audit; (4) to consider the independent auditors' review of audit results,
including the proposed auditors' report on the Funds' financial statements and
the proposed auditors' report on internal controls; (5) to review reports by the
Funds' investment adviser, including reports on: (a) any problems under the
Funds' Codes of Ethics; (b) the adequacy of internal controls and internal audit
functions; (c) the performance of the Funds' service providers; (d) any problems
with compliance with the Funds' investment policies and restrictions; and (e)
any actual or apparent conflicts of interest between the Funds and their
investment adviser, distributor or other service providers.
8
The Audit Committee met three times during the fiscal year ended July 31, 2003.
No Director attended less than 75% of the Board meetings, including committee
meetings.
As described above, the integration initiative includes proposals to create a
single board of directors/trustees for the funds. As part of this initiative,
the Board has nominated nine individuals to serve on the board of directors of
the Company. These same individuals are being nominated to serve on the boards
of directors/trustees for each of the other funds so that a single, unitary
board of directors/trustees would be elected for all of the funds.
The eight independent directors/trustees nominated to serve on the single,
unitary board have been selected from among the independent directors/trustees
currently serving on the boards of the funds. In this connection, the
independent directors/trustees of the existing boards of the funds determined to
create an ad hoc board consolidation committee (the "Committee") of four
independent directors/trustees. An independent board member from each of the
four fund families was selected to serve on the Committee. The Committee was
assigned the responsibility of evaluating each existing board member's
professional background and work experience, professional competencies, time
availability and commitment, and overall past contribution to the board of an
existing fund within the fund complex. The Committee was also responsible for
developing recommendations for the size and actual membership of the new board.
Among the core professional competencies and abilities that the Committee
considered relevant in making its recommendations on board membership were a
person's investment background, accounting/finance background,
academic/theoretical background, marketing perspective, technology/systems
background, leadership abilities, business acumen and entrepreneurial talent. In
addition, the Committee took into account the age distribution, diversity and
impact of regulatory requirements in its recommendations on the composition of
the new board.
Based on the recommendations of the Committee, the independent
directors/trustees of each of the funds' boards determined to fix the number of
board members at nine, eight of whom would be independent board members and one
of whom would be an inside board member. Each of the boards also approved the
Committee's
9
recommendations on the eight independent board member nominees and management's
recommendation on the inside board member nominee.
The Committee does not have a charter. The Company does not have a stated policy
with regard to the consideration of board candidates nominated by shareholders.
As part of the creation of the new Tamarack Funds Trust, which is being proposed
as part of the integration initiative described above, it is expected that the
Trust's board of trustees will establish various committees as part of the
organization process for the Trust. As part of that process, the board of
trustees will determine whether to establish a formal nominating committee,
prepare a written charter for the committee, include a formal policy on
consideration of shareholder nominations to serve on the board of trustees,
define the material elements that would be included in any such policy, identify
the process to be followed by such committee in identifying and evaluating
nominees (including those recommended by shareholders), specify minimum
qualifications for any committee-recommended nominees, including any specific
qualities or skills, and establish a process for shareholders to send
communications to the board of trustees.
* * *
SHAREHOLDER APPROVAL: Election of each of the Nominees to the Board of Directors
must be approved by the affirmative vote of the holders of a majority of the
voting power of the shares present and entitled to vote on that item of
business. The votes of each series of the Company will be counted together with
respect to the election of the Nominees.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A
VOTE FOR APPROVAL OF THE ELECTION OF
EACH OF THE NOMINEES TO THE BOARD OF DIRECTORS.
---------------------------
PROPOSAL 2 -- ALL FUNDS
APPROVAL OF AGREEMENT AND PLAN OF REORGANIZATION
---------------------------
At a meeting of the Board held on November 24, 2003, the Board approved on
behalf of the Company and its Funds an Agreement and Plan of Reorganization
("Plan") substantially in the form attached to this Proxy Statement as EXHIBIT
A. Fund shareholders are now being asked to approve the Plan. If shareholders of
a Fund approve the proposal, the Directors and officers of the Company will
execute and implement the Plan on behalf of such Fund. If approved, the
Reorganization is expected to take effect on or about March 31, 2004 ("Closing
Date"), although that date may be adjusted in accordance with the Plan.
OVERVIEW OF THE PROPOSAL
Shareholders of each Fund are asked to consider the proposed Plan, which
contemplates:
o the transfer of all of the assets of the Fund to the corresponding
Tamarack Fund and the assumption by the corresponding Tamarack Fund
of all of the liabilities of the Fund in exchange for shares of the
corresponding Tamarack Fund having an aggregate net asset value
equal to the transferred net assets of the Fund;
o the distribution to each shareholder of the Fund of the same number
of shares of the corresponding Tamarack Fund having an aggregate net
asset value equal to the aggregate net asset value of the shares of
the Fund held by that shareholder on the Closing Date (shareholders
of Funds that offer
10
multiple classes of shares will receive shares of the corresponding
class of the corresponding Tamarack Fund); and
o the subsequent complete liquidation of the Fund.
The following table presents the name of the Tamarack Fund corresponding to each
Fund.
GREAT HALL FUND CORRESPONDING TAMARACK FUND
==================================================================================================
Great Hall Prime Money Market Fund Tamarack Prime Money Market Fund
Great Hall U.S. Government Money Market Fund Tamarack U.S. Government Money Market Fund
Great Hall Tax-Free Money Market Fund Tamarack Tax-Free Money Market Fund
Great Hall Institutional Prime Money Market Fund Tamarack Institutional Prime Money Market Fund
Great Hall Institutional Tax-Free Money Tamarack Institutional Tax-Free Money
Market Fund Market Fund
For a more detailed discussion of the terms of the Plan, please refer to
"Additional Information About the Plan," below.
Prior to shares of the Tamarack Funds being distributed to the Funds'
shareholders, the Funds, as shareholders of the Tamarack Funds Trust, will be
asked to vote on certain issues regarding the organization of the Tamarack Funds
Trust. A Fund will vote in favor of such matters regarding the organization of
the Tamarack Funds Trust only to the extent that the shareholders of that Fund
have voted in favor of the proposed Reorganization. Thus, shareholders of the
Funds, in approving the proposed Reorganization, will also, in effect, be
approving the following matters with respect to the Tamarack Funds Trust:
o Election of the nine Trustees described in Proposal 1;
o Approval of investment advisory agreements with Voyageur, which will
be substantially similar to the investment advisory agreements
currently in place with respect to the Funds, except as noted below;
o Approval of the liquidation and dissolution of the Company, to the
extent such approval is required.
Shareholders of the Funds are not being asked to vote separately on these
issues. More information on each of these items is discussed below under
"Matters on Which the Tamarack Funds Will Vote."
BOARD CONSIDERATION OF THE PLAN
The primary purposes of the proposed Reorganization are to seek future economies
of scale and to eliminate certain costs associated with operating eight
different business entities--the Company, RBC Funds, Inc., J&B Funds, Babson
Enterprise Fund, Inc., Babson Enterprise Fund II, Inc., Babson Value Fund, Inc.,
D.L. Babson Tax-Free Income Fund, Inc. and Shadow Stock Fund, Inc.--in three
different states. In unanimously approving the Reorganization, the Directors of
the Company determined that the proposed Reorganization would be in the best
interests of the applicable Fund and its shareholders and that the ownership
interests of each Fund's shareholders would not be diluted as a result of the
Reorganization. Key factors considered by the Board are summarized below:
11
o Voyageur has informed the Board that it believes that by reorganizing
each Fund and the other funds advised by Voyageur as separate series
of a single entity, the Tamarack Funds Trust, the funds should be able
to realize greater operating efficiencies.
o Voyageur has informed the Board that it believes that the proposed
Delaware statutory trust form provides a cost efficient and flexible
method of operating the Funds for the benefit of Fund shareholders.
In recent years, many mutual funds have reorganized as Delaware
statutory trusts.
o The terms of the current expense limitation agreement for each Fund,
which is in place through November 30, 2004, would continue to be
applied to the corresponding Tamarack Fund.
o The Funds will not bear any ordinary costs of the Reorganization.
o The investment objective of each Fund will be identical to that of the
corresponding Tamarack Fund, and the Tamarack Fund will be managed by
the same personnel and, with a few exceptions that are the subject of
Proposal 3, in accordance with the same investment strategies and
techniques utilized in the management of each Fund immediately prior
to the Reorganization.
o Shareholders of the Funds will continue to receive the same level of
services currently provided by the Fund.
o The Reorganization is intended to be tax-free for federal income tax
purposes.
o Shareholders' ownership interests will not be diluted as a result of
the Reorganization.
EFFECTS OF THE REORGANIZATION ON THE FUNDS AND THEIR SHAREHOLDERS
Immediately after the Reorganization, shareholders of each Fund will own shares
of the corresponding Tamarack Fund that are equal in number and in value to the
shares of each Fund that were held by those shareholders immediately prior to
the closing of the Reorganization (the "Closing"). Shareholders of those Funds
that offer multiple classes of shares will own shares of the corresponding class
of each corresponding Tamarack Fund. For example, a shareholder who owns 100
Investor Class shares of a Fund immediately prior to the Closing would own,
immediately after the Closing, 100 Investor Class shares of the corresponding
Tamarack Fund having the same net asset value as those 100 Investor Class shares
of the Fund held immediately prior to the Closing. Shareholders of those Funds
that do not offer multiple classes of shares (namely, Institutional Prime Fund
and Institutional Tax-Free Fund) will own corresponding shares of each
corresponding Tamarack Fund.
The Tamarack Fund corresponding to each Great Hall Fund will offer the same
class, if any, as currently is offered by such Great Hall Fund.
As a result of the Reorganization, shareholders of the Funds, which are series
of the Company, a Minnesota corporation, will become shareholders of the
Tamarack Funds, each of which is a series of a Delaware statutory trust. For a
comparison of certain attributes of these entities that may affect shareholders
of the Funds, please see "Comparison of the Company and the Tamarack Funds
Trust" below.
THE REORGANIZATION WILL NOT RESULT IN ANY CHANGE IN THE INVESTMENT OBJECTIVE OR
PRINCIPAL INVESTMENT STRATEGIES, INVESTMENT ADVISOR OR PORTFOLIO MANAGERS OF ANY
OF THE FUNDS. IF PROPOSALS 3 IS APPROVED, WHETHER OR NOT THIS REORGANIZATION
PROPOSAL IS APPROVED, CERTAIN CHANGES MAY BE MADE TO CURRENT
12
INVESTMENT POLICIES/RESTRICTIONS OF THE FUNDS, AS FURTHER DESCRIBED IN THAT
PROPOSAL. EACH TAMARACK FUND WILL OFFER THE SAME SHAREHOLDER SERVICES AS ITS
CORRESPONDING FUND.
NO SALES LOAD, COMMISSION OR OTHER TRANSACTIONAL FEE IN CONNECTION WITH THE
REORGANIZATION
The full value of your shares of a Fund will be exchanged for shares of the
corresponding Tamarack Fund without any sales load, commission or other
transactional fee being imposed.
FEDERAL INCOME TAX CONSEQUENCES OF THE REORGANIZATION
As a condition to each Fund's obligation to consummate the Reorganization, the
Fund and the Tamarack Fund will receive an opinion from legal counsel to the
Funds to the effect that, on the basis of the existing provisions of the
Internal Revenue Code of 1986, as amended ("Code"), current administrative rules
and court decisions, the transactions contemplated by the Plan constitute a
tax-free reorganization for federal income tax purposes.
EXPENSES RELATED TO THE REORGANIZATION
Voyageur, the Funds' investment advisor, will bear all ordinary expenses
associated with the Reorganization, other than any expenses individually
incurred by shareholders. No extraordinary expenses are expected.
ADDITIONAL INFORMATION ABOUT THE PLAN
SUMMARY OF TERMS
The following is a summary of the Plan. This summary is subject in all respects
to the provisions of, and is qualified in its entirety by reference to, the
Plan, which is attached as EXHIBIT A.
As stated above, with respect to each Fund and its corresponding Tamarack Fund,
the Plan provides that all of the assets of the Fund will be transferred to the
Tamarack Fund, which will assume all of the Fund's liabilities. Fund
shareholders will receive that number of full and fractional Investor Class
shares of the Tamarack Fund which is equivalent in number and value to the
shares of the Fund held as of the close of business on the Closing Date.
Immediately following the Reorganization, shareholders of the Fund will be
shareholders of its corresponding Tamarack Fund and the Tamarack Fund will have
no other shareholders. The Fund's shareholders will not pay a sales charge,
commission or other transaction costs in connection with their receipt of shares
of the Tamarack Fund.
With respect to each Fund, the Plan must be approved separately by shareholders
of that Fund. In the event that shareholders of a particular Fund do not approve
the Reorganization of that Fund with and into the corresponding Tamarack Fund,
the Plan will continue to remain in full force and effect with respect to any
reorganization transactions approved by shareholders of the other Funds.
Moreover, the Plan provides that the benefits and obligations attendant to the
Reorganization are severable with respect to each Fund and the corresponding
Tamarack Fund.
Each Reorganization is subject to a number of conditions, including the
following: (1) approval of the Plan and the transactions contemplated thereby as
described in this Proxy Statement by the shareholders of the Fund; (2) the
receipt of certain legal opinions described in the Plan; (3) the receipt of
certain certificates from the parties concerning the continuing accuracy of the
representations and warranties in the Plan and other matters; and (4) the
parties' performance in all material respects of their agreements and
undertakings in the Plan. For a complete description of the terms and conditions
of the Reorganization, please refer to the Plan in EXHIBIT A.
If the shareholders approve the Plan and the various other conditions required
for the Closing are satisfied, the Closing is expected to occur on or about
March 31, 2004, or such other date as is agreed to by the Funds, on the basis of
values calculated as of the close of regular trading on the New York Stock
Exchange as of the close of business on the Closing Date.
13
The Plan may be terminated (i) by the mutual agreement of the parties, or (ii)
by either party if the Closing shall not have occurred on or before July 15,
2004, unless such date is extended by mutual agreement of the parties, (iii) by
either party if the other party shall have materially breached its obligations
under the Plan or made a material and intentional misrepresentation in the Plan
or in connection with the Plan, or (iv) at any time prior to the Closing Date if
circumstances should develop that, in the opinion of the Board or the board of
trustees of the Tamarack Fund make proceeding with the Reorganization
inadvisable with respect to the Fund or the Tamarack Fund, respectively. The
Plan may also be amended by mutual agreement of the parties in writing. However,
no amendment may be made following the shareholder meeting if such amendment
would have the effect of changing the provisions for determining the number of
shares of the Tamarack Fund to be issued to the Fund under the Plan to the
detriment of the Fund's shareholders without their approval.
TAX CONSIDERATIONS
It is anticipated that each Reorganization will be a tax-free reorganization
within the meaning of Section 368(a) of the Code. With respect to each
Reorganization, the Fund and its corresponding Tamarack Fund will receive an
opinion from Dechert LLP substantially to the effect that, based on certain
facts, assumptions and representations, for federal income tax purposes: (1) the
Reorganization will constitute a "reorganization" within the meaning of Code
Section 368(a); (2) the shareholders will recognize no gain or loss on their
receipt of voting shares of the Tamarack Fund in exchange for their voting
shares of the Fund pursuant to the Reorganization; (3) the Fund will not
recognize gain or loss on the transfer of all of its assets to the Tamarack Fund
solely in exchange for voting shares of the Tamarack Fund and the assumption by
the Tamarack Fund of the Fund's liabilities pursuant to the Reorganization; (4)
the Fund will not recognize gain or loss on its distribution of voting shares of
the Tamarack Fund to its shareholders pursuant to the liquidation of the Fund;
(5) the Tamarack Fund will not recognize gain or loss on its acquisition of all
of the assets of the Fund solely in exchange for voting shares of the Tamarack
Fund and the assumption by the Tamarack Fund of the Fund's liabilities; (6) the
tax basis of the voting shares of the Tamarack Fund received by each of the
Fund's shareholders pursuant to the Reorganization will equal the tax basis of
the voting shares of the Fund surrendered in exchange therefor; (7) the holding
period of the voting shares of the Tamarack Fund received by each of the
shareholders pursuant to the Reorganization will include the period that the
shareholder held the voting shares of the Fund exchanged therefor, provided that
the shareholder held such shares as capital assets on the date of the
Reorganization; (8) the Tamarack Fund's basis in the assets of the Fund received
pursuant to the Reorganization will equal the Fund's basis in the assets
immediately before the Reorganization; and (9) the Tamarack Fund's holding
period in the Fund's assets received pursuant to the Reorganization will include
the period during which the Fund held the assets. No opinion will be expressed
by Dechert LLP, however, as to whether any gain or loss will be recognized by
any Fund or Tamarack Fund in connection with any disposition of assets by the
Fund or the Tamarack Fund prior to or following the Reorganization.
Shareholders of the Fund should consult their tax advisors regarding the effect,
if any, of the Reorganization in light of their individual circumstances and,
since the foregoing discussion only relates to the federal income tax
consequences of the Reorganization, should consult their tax advisors as to
state and local tax consequences, if any, of the Reorganization.
COMPARISON OF THE COMPANY AND THE TAMARACK FUNDS TRUST
The Company is a Minnesota corporation governed by its Articles of
Incorporation, By-Laws and Board of Directors. The Tamarack Funds Trust is a
Delaware statutory trust governed by its Agreement and Declaration of Trust,
By-Laws and Board of Trustees. The operations of the Tamarack Funds Trust and
the Company are also governed by applicable state and Federal law.
Certain differences and similarities between the Tamarack Funds Trust and the
Company are summarized below, although this is not a complete list of
comparisons. Shareholders should refer to the provisions of these governing
documents and the relevant state law directly for a more thorough comparison.
Copies of these governing documents are available to shareholders without charge
upon written request.
14
Under the Agreement and Declaration of Trust and By-Laws of the Tamarack Funds
Trust, the Trustees of the Tamarack Funds Trust will have more flexibility than
Directors of the Company and, subject to applicable requirements of the 1940 Act
and Delaware law, broader authority to act. The increased flexibility may allow
the Trustees of the Tamarack Funds Trust to react more quickly to changes in
competitive and regulatory conditions and, as a consequence, may allow the
Tamarack Funds Trust to operate in a more efficient and economical manner.
Delaware law also promotes ease of administration by permitting the Board of the
Tamarack Funds Trust to take certain actions, for example, establishing new
investment series of the Tamarack Funds Trust, without filing additional
documentation with the state, and incurring the additional preparation time and
costs.
Importantly, the Trustees of the Tamarack Funds Trust will effectively have the
same fiduciary obligations to act with due care and in the interest of the
Tamarack Funds and their shareholders as do the Directors with respect to the
Funds and their shareholders.
For more detailed information, please refer to the comparison of the Tamarack
Funds Trust and the Company in EXHIBIT C to this Proxy Statement.
MATTERS ON WHICH THE TAMARACK FUNDS WILL VOTE
As noted above, in approving the Plan, shareholders of each Fund will also be
authorizing that Fund to vote on various actions regarding the Tamarack Funds
and the Tamarack Funds Trust. Fund shareholders are not being asked to vote
separately on these actions. One of these actions will be to approve the
election of Trustees of the Tamarack Funds Trust. The nominees for election will
be the same Nominees elected under Proposal 1 at the Meeting. In addition, while
each Fund is the sole shareholder of the corresponding Tamarack Fund, each Fund
will approve a new investment advisory agreement with Voyageur. The new
investment advisory agreement will be substantially similar to the current
investment advisory agreement for such Fund, except as noted in EXHIBIT D to
this Proxy Statement. For information about the new investment advisory
agreement, please refer to EXHIBIT D to this Proxy Statement. Shareholders of
each Fund approving of the Reorganization will also be approving the liquidation
and dissolution of that Fund and the liquidation and dissolution of the Company.
INVESTMENT ADVISOR
Voyageur is a wholly-owned subsidiary of RBC Dain Rauscher Corporation, which
maintains its offices at Dain Bosworth Plaza, 60 South Sixth Street,
Minneapolis, Minnesota 55402. RBC Dain Rauscher Corporation is a wholly-owned
subsidiary of Royal Bank of Canada ("RBC"), which maintains its offices at 200
Bay Street, Toronto, Ontario, Canada M5J 2J5 A6 00000. RBC is a diversified
financial services company that provides personal and commercial banking, wealth
management services, insurance, corporate and investment banking, online banking
and transaction processing on a global basis. As of October 31, 2003, RBC
employs approximately 60,000 people who serve approximately 12 million personal,
business and public sector customers in North America and in some 30 countries
around the world.
Voyageur has been registered with the Securities and Exchange Commission ("SEC")
as an investment advisor since 1983, and has been a portfolio manager of
publicly-offered mutual funds since 1986. Voyageur maintains its offices at 90
South Seventh Street, Suite 4300, Minneapolis, Minnesota 55402. Voyageur employs
an experienced staff of professional investment analysts, portfolio managers and
traders, and uses several proprietary computer-based systems in conjunction with
fundamental analysis to identify investment opportunities.
Voyageur was formed in 1983 and currently provides investment advisory and
administrative services to the Babson Funds, a family of ten individual equity,
fixed income, and money market funds and portfolios; RBC Funds, Inc., a series
company that currently consists of six separately managed equity and fixed
income portfolios; and J&B Funds, a series company that currently consists of a
single equity portfolio. Voyageur also provides fixed income, equity and
balanced portfolio management services to a variety of wrap programs,
15
insurance company separate accounts, and private account clients, including
individuals, public entities, Taft-Hartley plans, corporations, private
nonprofits, foundations, endowments and healthcare organizations. As of October
31, 2003, Voyageur had approximately $23 billion in assets under management,
approximately $10.7 billion of which was represented by the net assets of Great
Hall Investment Funds, Inc., $317 million of which was represented by the net
assets of RBC Funds, Inc., $1.2 billion of which was represented by the net
assets of the Babson Group of Funds, and $12 million of which was represented by
the net assets of J&B Funds.
EXHIBIT F to this Proxy Statement sets forth information regarding other
registered investment companies with investment objectives similar to the Funds
for which Voyageur acts as investment advisor, including the rate of Voyageur's
compensation.
EXHIBIT G to this Proxy Statement sets forth information regarding the principal
executive officer and directors of Voyageur.
EXHIBIT E to this Proxy Statement sets forth the amount of fees paid by the
Funds to Voyageur under the current investment advisory agreements during the
most recently completed fiscal years. Voyageur has also contractually agreed to
limit expenses for the Funds through November 30, 2004 so that annual fund
operating expenses do not exceed certain rates. EXHIBIT E also sets forth
information concerning the amount and purpose of payments made by each Fund to
Voyageur or any affiliated person of Voyageur for services provided to the Funds
(other than under the current investment advisory agreements or for brokerage
commissions) during the most recently completed fiscal years.
* * *
SHAREHOLDER APPROVAL: Approval of Proposal 2 with respect to each Fund will
require the affirmative vote of the holders of a majority of the voting power of
the shares present and entitled to vote on that item of business.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT
THE SHAREHOLDERS OF EACH FUND APPROVE THE PLAN.
---------------------------
PROPOSAL 3 -- ALL FUNDS
APPROVAL OF THE MODIFICATION OR RECLASSIFICATION AS NON-FUNDAMENTAL OF
CERTAIN FUNDAMENTAL INVESTMENT POLICIES/RESTRICTIONS
---------------------------
The 1940 Act requires each Fund to adopt policies governing certain specified
activities, which can be changed only by a shareholder vote. Policies that
cannot be changed or eliminated without a shareholder vote are referred to in
this Proxy Statement as "fundamental" policies or restrictions. The purposes of
this Proposal are to eliminate the requirement of shareholder approval to change
policies/restrictions except where required by the 1940 Act and to provide the
maximum permitted flexibility in those policies/restrictions that do require
shareholder approval. Voyageur has informed the Board that some of the Funds'
fundamental policies/restrictions that are not required to be fundamental under
the 1940 Act were adopted in the past as a result of now rescinded regulatory
requirements and no longer serve any useful purpose. Voyageur believes that
other fundamental policies/restrictions are unnecessary because the provisions
of the 1940 Act or federal tax law, together with the disclosure requirements of
the federal securities laws, provide adequate safeguards for a Fund and its
shareholders.
16
Many of the Funds' current fundamental investment policies/restrictions can be
traced back to certain legal and regulatory requirements that were in effect
when the Funds were organized or were adopted for other reasons (for example,
then prevailing industry conditions or practices). These policies/restrictions
have subsequently been made less restrictive or are no longer applicable to the
Funds. For example, the National Securities Markets Improvement Act of 1996
preempted many investment restrictions formerly imposed by state securities laws
and regulations, so those state requirements no longer apply. As a result,
certain of the current policies/restrictions unnecessarily limit the investment
strategies available to Voyageur in managing a Fund's assets. In addition, the
lack of uniform standards applicable to all of the Funds leads to operating
inefficiencies and increases the costs of compliance monitoring.
In general, under this Proposal only those investment restrictions that the 1940
Act specifically requires to be fundamental (that is, those from which
registered investment companies cannot deviate without shareholder
authorization) will remain fundamental investment policies/restrictions of the
Funds. However, shareholders are being asked to approve amendments to these
investment policies/restrictions. Investment restrictions that are currently
designated fundamental by a Fund, but which the 1940 Act does not require to be
classified as fundamental, are proposed to be reclassified as non-fundamental.
This Proposal is sub-divided into the following two sections:
(1) REVISION OF POLICIES THAT MUST REMAIN FUNDAMENTAL. Each of the fundamental
policies/restrictions proposed for revision in this section relates to an
activity that the 1940 Act only permits to be changed by shareholder approval.
Each proposed revision is, in general, intended to provide the Funds' Board with
the maximum flexibility permitted under the 1940 Act, and to promote consistency
among the Funds' policies/restrictions. Those fundamental investment
policies/restrictions that will remain fundamental are set forth in Proposals
3.A-3.H.
(2) ELIMINATION OF SHAREHOLDER APPROVAL REQUIREMENT TO CHANGE OTHER FUNDAMENTAL
POLICIES. The proposed revisions in this section seek to eliminate the
requirement of shareholder approval to change the policies/restrictions that are
not required to be classified as fundamental under the 1940 Act. Any
policy/restriction that is not designated as fundamental can be modified or
eliminated by the Board. Accordingly, reclassifying these fundamental
policies/restrictions as non-fundamental will permit the Funds to minimize the
costs and delays associated with holding future shareholder meetings to revise
policies/restrictions that become outdated or unnecessary under current
conditions. Those fundamental investment policies/restrictions that are proposed
to be reclassified as non-fundamental are addressed in Proposals 3.I - 3.P.
Each Fund's current fundamental policies/restrictions are set forth in EXHIBIT H
to this Proxy Statement. Changes in fundamental policies/restrictions that are
approved by shareholders, as well as changes in non-fundamental
policies/restrictions that are adopted by the Board, will be reflected in each
Fund's Prospectus and other disclosure documents. Any change in the method of
operation of a Fund will require prior Board approval. Should shareholders
approve the Proposal, the Funds would continue to be managed subject to the
limitations imposed by the 1940 Act and the rules and interpretive guidance
provided thereunder.
Approval of each item of this Proposal with respect to any Fund requires the
affirmative vote of a majority of that Fund's outstanding voting securities (as
that term is defined in the 1940 Act). In addition, approval of changes to the
Funds' fundamental investment policies/restrictions will not be dependent upon
your vote on Proposal 2 regarding the Reorganization. Therefore, if approved by
shareholders, these changes would take effect regardless of the vote with
respect to the Reorganization. Should shareholders also approve the proposed
Reorganization, each Tamarack Fund would have as its fundamental investment
policies/restrictions those revised fundamental investment policies/restrictions
approved by the corresponding Fund's shareholders. Should a Fund's shareholders
not approve an item of this Proposal to amend or reclassify a particular
fundamental investment policy/restriction, the Fund's current fundamental
investment policy/restriction, as set forth in EXHIBIT H, would continue to
apply unchanged.
17
REVISION OF POLICIES THAT MUST REMAIN FUNDAMENTAL
-------------------------------------------------
PROPOSAL 3.A -- DIVERSIFICATION
APPLICABLE FUNDS -- PRIME FUND, GOVERNMENT FUND AND TAX-FREE FUND
PROPOSED NEW FUNDAMENTAL INVESTMENT POLICY/RESTRICTION: If this Proposal item is
approved by shareholders, each Fund's sub-classification as a diversified or
non-diversified Fund would read:
Each Fund has elected to be classified as a diversified series of an
open end management investment company and will invest its assets
only in a manner consistent with this classification under
applicable law.
DISCUSSION OF PROPOSED MODIFICATION
Section 8(b) of the 1940 Act requires each series of an investment company to
state whether it is "diversified" or "non-diversified," as those terms are
defined in the 1940 Act. Under the 1940 Act, a diversified fund generally is
required to have 75% of its total assets invested in (1) cash and cash items
(including receivables), obligations issued or guaranteed by the U.S.
Government, its agencies or instrumentalities, or securities of other investment
companies; or (2) other securities limited for any one issuer to an amount (x)
not greater than 5% of the total assets of the fund, and (y) not more than 10%
of the outstanding voting securities of such issuer.
Each Fund is currently classified as a diversified series of an open-end
investment company. However, each Fund has adopted a more restrictive
diversification policy (applying the diversification requirements to 100% of the
value of its assets) than what is required by the 1940 Act. No change is being
proposed to a Fund's designation as a diversified Fund. Instead, the proposed
change would modify the Funds' fundamental investment policies/restrictions
regarding diversification to rely on the definition of the term "diversified" in
the 1940 Act rather than stating relevant percentage limitations that exceed
those required by the 1940 Act. Thus, this investment policy/restriction will
apply to each Fund the requirements of the 1940 Act, as they may be amended from
time to time (which are applicable in any case), without the Funds' Board or
shareholders taking further action.
PROPOSAL 3.B -- BORROWING
APPLICABLE FUNDS -- ALL FUNDS
PROPOSED NEW FUNDAMENTAL INVESTMENT POLICY/RESTRICTION: If this Proposal item is
approved by shareholders, each Fund's fundamental investment policy/restriction
regarding borrowing would read:
Each Fund will not borrow money, except as permitted under the
Investment Company Act of 1940, as amended, and the rules and
regulations thereunder, or as may otherwise be permitted from time
to time by a regulatory authority having jurisdiction.
DISCUSSION OF PROPOSED MODIFICATION
Unless further restricted, all investment companies are limited in the amount
they may borrow by the 1940 Act. At the present time, the 1940 Act permits a
Fund to borrow from banks in an amount up to 33-1/3% of the Fund's assets,
including the amount borrowed. The proposed policy/restriction would permit the
Funds to borrow in a manner and to the full extent permitted under applicable
law and regulation. Therefore, no further Board or shareholder action would be
needed to conform the borrowing policy/restriction to future changes in the 1940
Act, and interpretations thereunder, that govern borrowing by investment
companies. This change is
18
sought for administrative convenience. None of the Funds currently anticipates
changing its existing practices on borrowing or expanding those practices.
PROPOSAL 3.C -- SENIOR SECURITIES
APPLICABLE FUNDS -- ALL FUNDS
PROPOSED NEW FUNDAMENTAL INVESTMENT POLICY/RESTRICTION: If this Proposal item is
approved by shareholders, each Fund's fundamental investment policy/restriction
regarding issuing senior securities would read:
Each Fund will not issue any class of senior securities, except as
permitted under the Investment Company Act of 1940, as amended, and
the rules and regulations thereunder, or as may otherwise be
permitted from time to time by a regulatory authority having
jurisdiction.
DISCUSSION OF PROPOSED MODIFICATION
The 1940 Act prohibits Funds from issuing senior securities, except for
borrowings where certain conditions are met. The proposed policy/restriction
rewords the current policies/restrictions of Institutional Prime Fund and
Institutional Tax-Free Fund and is intended to standardize this
policy/restriction across all of the Funds. The proposed policy/restriction
permits the Funds to issue senior securities to the full extent permitted under
applicable law and regulation. Therefore, no further Board or shareholder action
would be needed to conform this policy/restriction to future changes in the 1940
Act, and interpretations thereunder, that govern issuing senior securities by
investment companies.
PROPOSAL 3.D -- UNDERWRITING SECURITIES
APPLICABLE FUNDS -- ALL FUNDS
PROPOSED NEW FUNDAMENTAL INVESTMENT POLICY/RESTRICTION: If this Proposal item is
approved by shareholders, each Fund's fundamental investment policy/restriction
regarding underwriting securities would read:
Each Fund will not engage in the business of underwriting securities
issued by others, except to the extent that the Fund may be deemed
to be an underwriter under applicable laws in connection with the
disposition of portfolio securities.
DISCUSSION OF PROPOSED MODIFICATION
The proposed policy/restriction with respect to underwriting securities has been
reworded without making any material changes. In addition, for Prime Fund,
Government Fund and Tax-Free Fund, the proposed policy/restriction will identify
the general exception from the restriction on underwriting securities whereby
purchasing securities directly from an issuer or selling portfolio securities
may technically cause a Fund to be considered an underwriter. The current
investment policies/restrictions for Institutional Prime Fund and Institutional
Tax-Free Fund presently identify this exception.
19
PROPOSAL 3.E -- REAL ESTATE
APPLICABLE FUNDS -- ALL FUNDS
PROPOSED NEW FUNDAMENTAL INVESTMENT POLICY/RESTRICTION: If this Proposal item is
approved by shareholders, each Fund's fundamental investment policy/restriction
regarding investments in real estate would read:
Each Fund will not purchase or sell real estate, unless acquired as
a result of ownership of securities or other instruments, although
it may purchase securities secured by real estate or interests
therein, or securities issued by companies which invest, deal or
otherwise engage in transactions in real estate or interests
therein.
DISCUSSION OF PROPOSED MODIFICATION
With the following exception, the proposed real estate policy/restriction
rewords the current policy/restriction without making any material changes. The
current policies/restrictions of the Funds also prohibit investment in real
estate partnership interests and oil, gas and mineral leases. Voyageur intends
to recommend to the Board the adoption of this policy/restriction with respect
to real estate partnership interests and oil, gas and mineral leases as
non-fundamental.
PROPOSAL 3.F -- MAKING LOANS
APPLICABLE FUNDS -- ALL FUNDS
PROPOSED NEW FUNDAMENTAL INVESTMENT POLICY/RESTRICTION: If this Proposal item is
approved by shareholders, each Fund's fundamental investment policy/restriction
regarding making loans would read:
Each Fund will not make loans, except as permitted under, or to the
extent not prohibited by, the Investment Company Act of 1940, as
amended, and the rules and regulations thereunder, or as may
otherwise be permitted from time to time by a regulatory authority
having jurisdiction.
DISCUSSION OF PROPOSED MODIFICATION
The proposed policy/restriction, unlike the current policies/restrictions, does
not list exceptions or specify the particular types of lending in which a Fund
is permitted to engage. Instead, it would permit the Funds to engage in
securities lending to the full extent permitted under applicable law and
regulation. Therefore, should the SEC staff modify the requirements governing an
investment company's loan of its securities in the future, under the proposed
policy/restriction, each Fund would be able to take advantage of that increased
flexibility without requiring further shareholder action. The current
policies/restrictions for Prime Fund, Government Fund and Tax-Free Fund also
prohibit each Fund from entering into a repurchase agreement if, as a result
thereof, more that 10% of the Fund's total assets would be subject to repurchase
agreements maturing in more than seven days. Voyageur intends to recommend to
the Board the adoption of this policy/restriction as non-fundamental.
PROPOSAL 3.G -- CONCENTRATION OF INVESTMENTS
APPLICABLE FUNDS -- ALL FUNDS
PROPOSED NEW FUNDAMENTAL INVESTMENT POLICY/RESTRICTION: If this Proposal item is
approved by shareholders, each Fund's fundamental investment policy/restriction
regarding concentration of investments would read:
Each Fund will not concentrate its investments in the securities of
issuers primarily engaged in the same industry, as that term is used
in the Investment
20
Company Act of 1940, as amended, and as interpreted or modified from
time to time by a regulatory authority having jurisdiction, except
that (i) with respect to Tax-Free Fund and Institutional Tax-Free
Fund, this restriction will not apply to municipal obligations; (ii)
with respect to Prime Fund, Tax-Free Fund, Institutional Prime Fund
and Institutional Tax-Free Fund, this restriction will not apply to
securities issued or guaranteed by United States banks or United
States branches of foreign banks that are subject to the same
regulation as United States banks; and (iii) this restriction will
not apply to a Fund's investments in securities issued or guaranteed
by the U.S. Government, its agencies or instrumentalities.
DISCUSSION OF PROPOSED MODIFICATION
Each Fund currently has, and will continue to have, a fundamental investment
policy/restriction that prohibits the Fund from concentrating its investments in
any one industry. While the 1940 Act does not define what constitutes
"concentration" in an industry, the SEC staff has taken the position that
investment of more than 25% of a Fund's total assets in one or more issuers
conducting their principal business activities in the same industry (excluding
the U.S. Government, its agencies or instrumentalities) constitutes
concentration. The proposed policy/restriction would permit investment in an
industry up to the most recently prescribed limits under the 1940 Act and
accompanying SEC interpretations. Therefore, if the SEC or its staff were to
relax the current position in the future, the Funds would be able to take
advantage of such increased flexibility without seeking further shareholder
action.
PROPOSAL 3.H -- COMMODITIES
APPLICABLE FUNDS -- ALL FUNDS
PROPOSED NEW FUNDAMENTAL INVESTMENT POLICY/RESTRICTION: If this Proposal item is
approved by shareholders, each Fund's fundamental investment policy/restriction
regarding investments in commodities would read:
Each Fund will not purchase or sell physical commodities or
contracts relating to physical commodities, except as permitted
under the Investment Company Act of 1940, as amended, and the rules
and regulations thereunder, or as may otherwise be permitted from
time to time by a regulatory authority having jurisdiction.
DISCUSSION OF PROPOSED MODIFICATION
The current fundamental investment policies/restrictions prohibit the Funds from
investing in commodities or commodity contracts. The proposed policy/restriction
prohibits only the purchase of physical commodities or contracts relating to
physical commodities, and permits the Funds to purchase or sell commodities to
the full extent permitted under applicable law and regulation.
RECLASSIFICATION OF CERTAIN FUNDAMENTAL INVESTMENT RESTRICTIONS OF THE FUNDS
----------------------------------------------------------------------------
Each of the investment policies/restrictions listed below was based on
restrictions formerly imposed by legal and regulatory requirements, or then
prevailing industry conditions or practices, which have become outdated or
unnecessary under current requirements and conditions. As stated above, the
Proposal items in this section seek to eliminate the requirement of shareholder
approval to change each of these policies/restrictions that are not required to
be classified as fundamental under the 1940 Act. Accordingly, the Directors
unanimously recommend that the Funds' shareholders approve the reclassification
as non-fundamental of each of the Proposal items listed in Proposal 3.I-3.P.
21
PROPOSAL 3.I -- PLEDGING, MORTGAGING AND HYPOTHECATING FUND ASSETS
APPLICABLE FUNDS -- PRIME FUND, GOVERNMENT FUND AND TAX-FREE FUND
PROPOSAL
It is proposed that the fundamental investment policy/restriction on pledging,
mortgaging and hypothecating a Fund's assets be reclassified as a
non-fundamental investment policy/restriction.
PROPOSAL 3.J -- INVESTMENTS FOR CONTROL
APPLICABLE FUNDS -- PRIME FUND, GOVERNMENT FUND AND TAX-FREE FUND
PROPOSAL
It is proposed that the fundamental investment policy/restriction on investments
made for purposes of exercising control over, or management of, the issuer be
reclassified as a non-fundamental investment policy/restriction.
PROPOSAL 3.K -- INVESTMENTS IN OTHER INVESTMENT COMPANIES
APPLICABLE FUNDS -- PRIME FUND, GOVERNMENT FUND AND TAX-FREE FUND
PROPOSAL
It is proposed that the fundamental investment policy/restriction on investments
in other investment companies be reclassified as a non-fundamental investment
policy/restriction.
PROPOSAL 3.L -- WRITING AND SELLING OPTIONS
APPLICABLE FUNDS -- PRIME FUND, GOVERNMENT FUND AND TAX-FREE FUND
PROPOSAL
It is proposed that the fundamental investment policy/restriction on writing and
selling put and call options and similar financial instruments be reclassified
as a non-fundamental investment policy/restriction.
PROPOSAL 3.M -- MARGIN ACTIVITIES AND SHORT SELLING
APPLICABLE FUNDS -- PRIME FUND, GOVERNMENT FUND AND TAX-FREE FUND
PROPOSAL
It is proposed that the fundamental investment policy/restriction on margin
activities and selling securities short be reclassified as a non-fundamental
investment policy/restriction.
22
PROPOSAL 3.N -- UNSEASONED COMPANIES
APPLICABLE FUNDS -- PRIME FUND, GOVERNMENT FUND AND TAX-FREE FUND
PROPOSAL
It is proposed that the fundamental investment policy/restriction on investments
in securities of issuers which, with their predecessors, have a record of less
than three years of continuous operation be reclassified as a non-fundamental
investment policy/restriction.
PROPOSAL 3.O -- INVESTMENTS IN EQUITY SECURITIES
APPLICABLE FUNDS -- PRIME FUND, GOVERNMENT FUND AND TAX-FREE FUND
PROPOSAL
It is proposed that the fundamental investment policy/restriction on investments
in equity securities be reclassified as a non-fundamental investment
policy/restriction.
PROPOSAL 3.P -- INVESTMENTS IN NON-MUNICIPAL OBLIGATIONS
APPLICABLE FUND -- TAX-FREE FUND ONLY
PROPOSAL
It is proposed that the fundamental investment policy/restriction on investments
that are not municipal obligations be reclassified as a non-fundamental
investment policy/restriction.
* * *
SHAREHOLDER APPROVAL: Approval of each item of Proposals 3.A-3.P for the
applicable Fund will require the affirmative vote of a majority of the
outstanding shares of such Fund, as that term is defined in the 1940 Act. Under
the 1940 Act, the vote of a "majority of the outstanding shares" means the vote
of (1) 67% or more of the voting securities entitled to vote on the proposal
that are present 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 voting securities entitled to vote on the proposal, whichever is
less.
THE BOARD UNANIMOUSLY RECOMMENDS THAT THE SHAREHOLDERS
OF EACH FUND APPROVE PROPOSALS 3.A THROUGH 3.P, AS APPLICABLE.
---------------------------
PROPOSAL 4 -- ALL FUNDS
RATIFICATION OF SELECTION OF INDEPENDENT AUDITORS
---------------------------
Upon the recommendation of the Audit Committee, the Board of Directors, has
selected Deloitte & Touche LLP ("Deloitte") to serve as independent auditors of
the Funds with respect to its financial statements for its current fiscal year
and recommends that shareholders ratify such selection. Deloitte has confirmed
to the Audit
23
Committee that they are independent auditors with respect to the Funds.
Representatives of Deloitte are not expected to be present at the Meeting, but
have been given the opportunity to make a statement if they so desire and will
be available should any matter arise requiring their presence. Deloitte also
serves as independent auditors of the Babson Group of Funds, J&B Funds and RBC
Funds, Inc.
The Audit Committee is required to pre-approve all audit services and non-audit
services that an independent auditor provides to the Funds. Furthermore, the
Audit Committee is required to pre-approve any engagement of a Fund's
independent auditor to provide non-audit services to Voyageur or any affiliate
of Voyageur that provides ongoing services to the Funds, if such engagement
would relate directly to the Funds' operations and financial reporting. The
Audit Committee may delegate to one or more of its members authority to
pre-approve the auditor's provision of audit and/or non-audit services to the
Funds, or the provision of non-audit services to Voyageur or any service
provider affiliated with Voyageur. The Audit Committee will also review at least
annually whether any receipt of non-audit fees by the Funds' independent auditor
from (i) the Fund, (ii) other funds advised by Voyageur or its affiliates, (iii)
Voyageur or any entity controlling or controlled by Voyageur, and (iv) any
investment advisor or investment company service provider under common control
with Voyageur is compatible with maintaining the independence of the independent
auditor.
Deloitte served as independent auditors of the Funds for the fiscal year ended
July 31, 2003. For further information about the independent auditors of the
Funds, please refer to the "Independent Auditors" section under "General
Information About the Funds" below.
* * *
SHAREHOLDER APPROVAL: Approval of Proposal 4 by each Fund's shareholders
requires the affirmative vote of the holders of a majority of the voting power
of the shares present and entitled to vote on that item of business.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT THE
SHAREHOLDERS OF EACH FUND APPROVE PROPOSAL 4.
OTHER BUSINESS
The Board does not intend to present any other business at the Meeting. If,
however, any other matters are properly brought before the Meeting, the persons
named in the accompanying form of proxy will vote thereon in accordance with
their judgment.
SHAREHOLDER PROPOSALS
The Company is not required, and does not intend, to hold regular annual
meetings of shareholders. Shareholders wishing to submit proposals for
consideration for inclusion in a proxy statement for the next meeting of
shareholders should send their written proposals to the Company's offices, 60
South Sixth Street, Minneapolis, Minnesota 55402, so they are received within a
reasonable time before any such meeting. An opportunity will be provided at the
Meeting for shareholders present in person to present a motion to the Meeting.
Should any properly presented motion or any other matter requiring a vote of the
shareholders arise, including any question as to an adjournment or postponement
of the Meeting, the persons named as proxies will vote on such matters according
to their best judgment in the interests of the Funds.
VOTING INFORMATION
This Proxy Statement is furnished in connection with a solicitation of proxies
by the Board to be used at the Meeting. This Proxy Statement, along with a
Notice of the Meeting and proxy card(s), is first being mailed to
24
shareholders of the Funds on or about January 22, 2004. Only shareholders of
record as of the close of business on January 15, 2004 ("Record Date"), will be
entitled to notice of, and to vote at, the Meeting. If the enclosed form of
proxy card is properly executed and returned in time to be voted at the Meeting,
the proxies named therein will vote the shares represented by the proxy in
accordance with the instructions marked thereon. Unmarked but properly executed
proxy cards will be voted FOR the proposed Reorganization and FOR any other
matters deemed appropriate. A proxy may be revoked at any time on or before the
Meeting at which the matter is voted on by written notice to the Secretary of
the Funds at the address on the cover of this Proxy Statement or by attending
and voting at the Meeting. Unless revoked, all valid and executed proxies will
be voted in accordance with the specifications thereon or, in the absence of
such specifications, for approval of the Plan and the Reorganization
contemplated thereby. Shareholders holding shares through a broker-dealer who
wish to vote or revoke their proxies in person will need to present a valid
proxy obtained from their broker-dealer. Each share of record on the Record Date
is entitled to one vote on each matter presented at the Meeting, with
proportionate votes for fractional shares.
The Funds request that broker-dealer firms, custodians, nominees and fiduciaries
forward proxy material to the beneficial owners of the shares held of record by
such persons. Voyageur may reimburse such broker-dealer firms, custodians,
nominees and fiduciaries for their reasonable expenses incurred in connection
with such proxy solicitation. The cost of soliciting these proxies will be borne
by Voyageur. Voyageur has engaged [SOLICITOR NAME] to solicit proxies from
brokers, banks, other institutional holders and individual shareholders for an
approximate fee, including out-of-pocket expenses, of up to $[ ].
SHARE INFORMATION
The chart below lists the number of shares of the Funds that are outstanding as
of the Record Date:
NUMBER OF SHARES
NAME OF FUND OUTSTANDING
======================================================================
GREAT HALL INVESTMENT FUNDS, INC.
---------------------------------
Great Hall Prime Money Market Fund
Great Hall U.S. Government Market Fund
Great Hall Tax-Free Money Market Fund
Great Hall Institutional Prime Money Market Fund
Great Hall Institutional Tax-Free Money Market Fund
QUORUM
The presence in person or by proxy of the holders of 10% of the shares of stock
of the Company (or of the applicable series, if the proposal under consideration
requires approval by a separate vote of one or more series) outstanding and
entitled to vote at the Meeting constitutes a quorum.
VOTING REQUIREMENT
For Proposal 1, nominees for Director receiving the affirmative vote of the
holders of a majority of the voting power of the shares present and entitled to
vote on that item of business will be elected to the Board of Directors of the
Company. With respect to each Fund, Proposals 2 and 4 each require the
affirmative vote of the holders of a majority of the voting power of the shares
present and entitled to vote on that item of business. Proposals 3.A-3.P each
require the vote of the majority of a Fund's outstanding voting securities,
which, for these purposes, is the vote of (1) 67% or more of the voting
securities entitled to vote on the proposal that are present at the Meeting, if
the holders of more than 50% of the outstanding shares are present or
represented by proxy, or
25
(2) more than 50% of the outstanding voting securities entitled to vote on the
proposal, whichever is less.
ADJOURNMENT
In the event that a quorum to transact business or the vote required to approve
any Proposal is not obtained at the Meeting, the persons named as proxies may
propose one or more adjournments of the Meeting in accordance with applicable
law to permit further solicitation of proxies. If the proposed adjournment
relates to a Proposal on which all Funds are voting collectively, any such
adjournment will require the affirmative vote of the holders of a majority of
all of the Funds' shares present in person or by proxy and entitled to vote at
the Meeting. If the proposed adjournment relates to a Proposal on which Funds
are voting individually, any such adjournment with respect to a particular Fund
will require the affirmative vote of the holders of a majority of that Fund's
shares present in person or by proxy and entitled to vote at the Meeting. The
persons named as proxies will vote in favor of such adjournment with respect to
any Proposal those proxies which they are entitled to vote in favor of that
Proposal and will vote against any such adjournment with respect to any Proposal
those proxies required to be voted against that Proposal.
EFFECT OF ABSTENTIONS AND BROKER "NON-VOTES"
For purposes of determining the presence of a quorum for transacting business at
the Meeting, executed proxies marked as abstentions and broker "non-votes" (that
is, proxies from brokers or nominees indicating that such persons have not
received instructions from the beneficial owner or other persons entitled to
vote shares on a particular matter with respect to which the brokers or nominees
do not have discretionary power) will be treated as shares that are present for
quorum purposes but which have not been voted. Accordingly, abstentions and
broker non-votes will effectively be a vote against adjournment and against
Proposals 1, 2, 3 and 4 for which the required vote is a percentage of the
shares outstanding or present, and entitled to vote on the matter.
PROXY SOLICITATION
[Proxies are being solicited by mail. This Proxy Statement is first being mailed
on or about January 22, 2004 to shareholders of record as of January 15, 2004.
Additional solicitations may be made by telephone, e-mail, or other personal
contact by officers or employees of Voyageur and its affiliates or by proxy
soliciting firms retained by Voyageur. Voyageur has retained [SOLICITOR NAME] to
provide proxy solicitation services in connection with the Meeting at an
estimated cost of $[ ]. In addition, Voyageur may reimburse persons holding
shares in their names or names of their nominees for expenses incurred in
forwarding solicitation material to beneficial owners of Fund shares. The cost
of the solicitation will be borne by Voyageur. In addition to returning a
written proxy card, Fund shareholders may authorize Voyageur or [SOLICITOR NAME]
by telephone to execute proxies on their behalf. As the meeting date approaches,
shareholders of each Fund may receive a call from a representative of Voyageur
or [SOLICITOR NAME] if the Fund has not yet received their votes.
Proxies that are obtained will be recorded in accordance with the following
procedures. In all cases where a telephonic proxy is solicited, a Voyageur or
[SOLICITOR NAME] representative is required to ask the shareholder for the
shareholder's full name, address, social security number or employer
identification number, title (if the person giving the proxy is authorized to
act on behalf of an entity, such as a corporation), the number of shares owned
and to confirm that the shareholder has received this Proxy Statement in the
mail. A Voyageur or [SOLICITOR NAME] representative is required to verify the
identification information provided on the call against shareholder information
provided by a Fund. If the information solicited is successfully verified, the
Voyageur or [SOLICITOR NAME] representative has the responsibility to explain
the voting process, read the Proposals listed on the proxy card, and ask for the
shareholder's instructions on each Proposal. The Voyageur or [SOLICITOR NAME]
representative, although permitted to answer questions about the process, is not
permitted to recommend to the shareholder how to vote, other than to read any
recommendation set forth in this Proxy Statement. Voyageur or [SOLICITOR NAME]
will record the shareholder's instructions on the card. Within 72 hours,
Voyageur
26
or [SOLICITOR NAME] will send the shareholder a letter or mailgram confirming
the shareholder's vote and asking the shareholder to call Voyageur or [SOLICITOR
NAME] immediately if the shareholder's instructions are not correctly reflected
in the confirmation. Voyageur believes that these procedures are reasonably
designed to ensure that the identity of the shareholder casting the vote is
accurately determined and that the voting instructions of the shareholder are
accurately determined.]
BENEFICIAL OWNERS
For a list of persons or entities that owned beneficially or of record 5% or
more of the outstanding shares of a class of each Fund as of [DATE], to the best
of each Fund's knowledge, please refer to EXHIBIT I.
INFORMATION ABOUT THE FUNDS
Set forth below is a description of the current service providers of the Funds
and the proposed service providers of the Tamarack Funds Trust.
INVESTMENT ADVISOR
For information about Voyageur, please refer to Proposal 2 above.
DISTRIBUTOR, ADMINISTRATOR, SUB-ADMINISTRATOR, FUND ACCOUNTING AGENT, CUSTODIAN
AND TRANSFER AGENT
RBC Dain Rauscher Inc., located at 3435 Stelzer Road, Columbus, Ohio 43219, an
affiliate of Voyageur, serves as the Funds' distributor. Voyageur serves as the
Funds' administrator. BISYS Fund Services Limited Partnership ("BISYS LP")
serves as the Funds' sub-administrator and fund accounting agent. Wells Fargo
Bank Minnesota, N.A. ("Wells Fargo") serves as the Funds' custodian. BISYS Fund
Services Ohio, Inc. ("BISYS Ohio"), an affiliate of BISYS LP, serves as the
Funds' transfer agent.
Following the Reorganization, J&B, located at 90 South Seventh Street,
Minneapolis, Minnesota 55402, an affiliate of Voyageur, will serve as the
distributor of the Tamarack Funds; BISYS LP will serve as the Tamarack Funds'
administrator and fund accounting agent; Wells Fargo will serve as the Tamarack
Funds' custodian; and BISYS Ohio will serve as the transfer agent to the
Tamarack Funds corresponding to the Funds, while Boston Financial Data Services,
Inc. ("BFDS") will serve as the transfer agent to certain other Tamarack Funds.
INDEPENDENT AUDITORS
On November 24, 2003, the Board of Directors selected Deloitte as independent
auditors of the Funds for the fiscal year ending July 31, 2004. Deloitte has
confirmed to the Audit Committee of the Board of Directors ("Audit Committee")
that they are independent auditors with respect to the Funds.
PricewaterhouseCoopers LLP ("PwC") served as independent auditors of the Funds
for the fiscal year ended July 31, 2002. PwC had been selected by the Board as
the independent auditors of the Funds for the Funds' fiscal year ended July 31,
2003. In July and August 2003, a PwC affiliate in Canada provided certain
prohibited non-audit services for the benefit of a Canadian subsidiary of RBC,
the indirect parent company of Voyageur. Accordingly, PwC resigned effective
October 9, 2003 due to concerns regarding its independence and did not render an
audit opinion on the Funds' financial statements for the period ended July 31,
2003. On October 9, 2003, the Board of Directors selected Deloitte as the new
independent auditors of the Funds for the fiscal year ended July 31, 2003.
During the Funds' fiscal year ended July 31, 2002, PwC's audit reports
concerning the Funds contained no adverse opinion or disclaimer of opinion; nor
were its reports qualified or modified as to uncertainty, audit scope, or
accounting principles. Further, in connection with its audit work for the fiscal
year ended July 31,
27
2002, and through October 9, 2003, there were no disagreements between the Funds
and PwC on any matter of accounting principles or practices, financial statement
disclosure or auditing scope or procedure, which if not resolved to the
satisfaction of PwC would have caused it to make reference to the disagreements
in its report on the financial statements for such periods.
Certain information concerning the fees and services provided by Deloitte and
PwC to the Funds and to Voyageur and its affiliates for each entity's two most
recent fiscal years is provided below.
AUDIT FEES. The aggregate fees billed by Deloitte for professional services
rendered for the audit of the Funds' annual financial statements for the fiscal
year ended July 31, 2003 were $ [ ]. The aggregate fees billed by PwC for
professional services rendered for the audit of the Funds' annual financial
statements for the fiscal year ended July 31, 2002 were $ [ ].
AUDIT-RELATED FEES. The aggregate fees billed by Deloitte for professional
services rendered that are related to the audit of the Funds' annual financial
statements but not reported under "Audit Fees" above for the fiscal year ended
July 31, 2003 were $ [ ]. In addition, the aggregate fees billed by Deloitte for
such services rendered to Voyageur, or an affiliate thereof that provides
ongoing services to the Funds, relating to the operations and financial
reporting of the Funds and subject to pre-approval by the Audit Committee, for
the fiscal year ended July 31, 2003 were $ [ ]. The aggregate fees billed by PwC
for professional services rendered that are related to the audit of the Funds'
annual financial statements but not reported under "Audit Fees" above for the
fiscal year ended July 31, 2002 were $ [ ]. In addition, the aggregate fees
billed by PwC for such services rendered to Voyageur, or an affiliate thereof
that provides ongoing services to the Funds, relating to the operations and
financial reporting of the Funds and subject to pre-approval by the Audit
Committee, for the fiscal year ended July 31, 2002 were $ [ ].
TAX FEES. The aggregate fees billed by Deloitte for professional services
rendered for tax compliance, tax advice and tax planning for the fiscal year
ended July 31, 2003 were $ [ ]. In addition, the aggregate fees billed by
Deloitte for such services rendered to Voyageur, or an affiliate thereof that
provides ongoing services to the Funds, relating to the operations and financial
reporting of the Funds and subject to pre-approval by the Audit Committee, for
the fiscal year ended July 31, 2003 were $ [ ]. The aggregate fees billed by PwC
for professional services rendered for tax compliance, tax advice and tax
planning for the fiscal year ended July 31, 2002 were $ [ ]. In addition, the
aggregate fees billed by PwC for such services rendered to Voyageur, or an
affiliate thereof that provides ongoing services to the Funds, relating to the
operations and financial reporting of the Funds and subject to pre-approval by
the Audit Committee, for the fiscal year ended July 31, 2002 were $ [ ].
ALL OTHER FEES. The aggregate fees billed by Deloitte for professional services
rendered for products and services other that those described above for the
fiscal year ended July 31, 2003 were $ [ ]. In addition, the aggregate fees
billed by Deloitte for such services rendered to Voyageur, or an affiliate
thereof that provides ongoing services to the Funds, relating to the operations
and financial reporting of the Funds and subject to pre-approval by the Audit
Committee, for the fiscal year ended July 31, 2003 were $ [ ]. The aggregate
fees billed by PwC for professional services rendered for products and services
other that those described above for the fiscal years ended July 31, 2002 were $
[ ]. In addition, the aggregate fees billed by PwC for such services rendered to
Voyageur, or an affiliate thereof that provides ongoing services to the Funds,
relating to the operations and financial reporting of the Funds and subject to
pre-approval by the Audit Committee, for the fiscal year ended July 31, 2002
were $ [ ].
The Audit Committee considered whether the services described above were
compatible with Deloitte's and PwC's independence. The Audit Committee also
considered whether the provision of all other non-audit services rendered to
Voyageur, or an affiliate thereof that provides ongoing services to each Fund,
was compatible with maintaining the independence of Deloitte and PwC,
respectively. The Audit Committee has adopted pre-approval policies and
procedures pursuant to which the engagement of any independent auditor is
approved. Such procedures provide that: (1) before an auditor is engaged by a
Fund to render audit services, the
28
Audit Committee shall review and approve the engagement; (2) the Audit Committee
shall review and approve in advance any proposal (with the exception of
proposals that fall under a de minimis exception permitted by applicable law)
that a Fund employs its auditor to render "permissible non-audit services" to a
Fund, or any proposal (with the exception of proposals that fall under a de
minimis exception permitted by applicable law) that Voyageur, and any entity
controlling, controlled by, or under common control with Voyageur that provides
ongoing services to a Fund, employ a Fund's auditor to render non-audit
services, if such engagement would relate directly to the operations and
financial reporting of a Fund; (3) as a part of any such review, the Audit
Committee shall consider whether the provision of such services is consistent
with the auditor's independence; and (4) the Audit Committee may delegate to one
or more of its members ("Delegates") authority to pre-approve the auditor's
provision of audit services or permissible non-audit services to a Fund, or the
provision of non-audit services to Voyageur or any Voyageur-affiliated service
provider, provided that any pre-approval determination made by a Delegate is
presented to the full Audit Committee at its next meeting. The pre-approval
procedures do not include delegation of the Audit Committee's responsibilities
to management.
The percentage of the services rendered described under "Audit-Related Fees,"
"Tax Fees" and "All Other Fees," above, for which pre-approval was waived
subject to the de minimis exception as permitted by applicable law amounted to
[ ]%. The percentage of such services rendered to Voyageur, or an affiliate
thereof that provides ongoing services to the Funds, amounted to [ ]%.
The aggregate non-audit fees billed by Deloitte for services rendered to the
Funds and to Voyageur, or an affiliate of Voyageur that provided ongoing
services to the Funds, for the fiscal year ended July 31, 2003 were $ [ ]. The
aggregate non-audit fees billed by PwC for services rendered to the Funds and to
Voyageur, or an affiliate of Voyageur that provided ongoing services to the
Funds, for the fiscal year ended July 31, 2002 were $ [ ].
SHAREHOLDER INFORMATION
To help lower the impact of operating costs, the Funds attempt to eliminate
mailing duplicate documents to the same address. When two or more Fund
shareholders have the same last name and address, the Fund may send only one
prospectus, annual report, semiannual report, general information statement or
proxy to that address rather than mailing separate documents to each
shareholder. Shareholders may opt out of this single mailing at any time by
calling the Funds at (800) 934-6674 or writing to the Funds at 60 South Sixth
Street, Minneapolis, Minnesota 55402 and requesting the additional copies of
Fund documents. Shareholders sharing a single mailing address who are currently
receiving multiple copies of Fund documents can request delivery of a single
copy instead by calling the same telephone number or writing to the same
address.
LEGAL MATTERS
Certain legal matters concerning the federal income tax consequences of the
Reorganization and the issuance of shares of the Tamarack Funds Trust will be
passed upon by Dechert LLP, 200 Clarendon Street, 27th Floor, Boston,
Massachusetts 02116.
29
EXHIBIT A
FORM OF AGREEMENT AND PLAN OF REORGANIZATION
THIS AGREEMENT AND PLAN OF REORGANIZATION (the "Agreement") is made as
of this _____day of _____, 2004, by Tamarack Funds Trust ("New Acquiring
Trust"), a Delaware statutory trust, with its principal place of business at
_____, on behalf of each of its separate series listed on Schedule A (each, an
"Acquiring Fund"), and Great Hall Investment Funds, Inc. ("Target Company"), a
Minnesota corporation, with its principal place of business at _____, on behalf
of each of its separate series listed on Schedule A (each, a "Target Fund", and
together with its corresponding Acquiring Fund, a "Fund" and together, the
"Funds"). Each Target Fund has outstanding, and at the Closing Date will have
outstanding, one class of shares, which class is identified in Schedule A. Each
Acquiring Fund has been organized to hold the assets of a Target Fund and such
Acquiring Fund has had no assets (other than the seed capital required by
Section 14(a) of the Investment Company Act of 1940, as amended ("1940 Act"))
and has carried on no business activities prior to the date first shown above
and will have had no assets (other than the required seed capital) and will have
carried on no business activities prior to the consummation of this transaction
described herein.
This Agreement is intended to be and is adopted as a plan of
reorganization and liquidation within the meaning of Section 368(a) of the
Internal Revenue Code of 1986, as amended (the "Code"). The reorganizations
(each a "Reorganization" and collectively the "Reorganizations") will consist of
the transfer of all of the assets of each Target Fund to the corresponding
Acquiring Fund in exchange solely for voting shares of beneficial interest
($0.01 par value per share) of such Acquiring Fund (the "Acquiring Fund
Shares"), the assumption by such Acquiring Fund of all of the liabilities of
such Target Fund and the distribution of such Acquiring Fund Shares to the
shareholders of such Target Fund in complete liquidation of such Target Fund as
provided herein, all upon the terms and conditions hereinafter set forth in this
Agreement. All references in this Agreement to action taken by an Acquiring Fund
shall be deemed to refer to action taken by New Acquiring Trust on behalf of
such Acquiring Fund; and all references in this Agreement to action taken by a
Target Fund shall be deemed to refer to action taken by Target Company on behalf
of such Target Fund. Notwithstanding anything to the contrary in this Agreement,
the rights and obligations of each Acquiring Fund, and the New Acquiring Trust
with respect to that Acquiring Fund, and each Target Fund, and the Target
Company with respect to that Target Fund, are not contingent upon the
satisfaction by any other Acquiring Fund or Target Fund, as applicable, of its
obligations under this Agreement.
NOW, THEREFORE, in consideration of the premises and of the covenants
and agreements hereinafter set forth, the parties hereto covenant and agree as
follows:
1. TRANSFER OF ASSETS OF EACH TARGET FUND TO CORRESPONDING ACQUIRING FUND
IN EXCHANGE FOR ACQUIRING FUND SHARES, THE ASSUMPTION OF ALL TARGET FUND
LIABILITIES AND THE LIQUIDATION OF TARGET FUND
1.1. Subject to the terms and conditions set forth herein and on the
basis of the representations and warranties contained herein, each Target Fund
agrees to transfer to the corresponding Acquiring Fund all of its assets as set
forth in section 1.2, and such Acquiring Fund agrees in exchange therefor (i) to
deliver to the Target Fund that number of full and fractional Acquiring Fund
Shares corresponding to the Target Fund shares as of the time and date set forth
in section 2.1; and (ii) to assume all of the liabilities of the Target Fund, as
set forth in Section 1.2. All such Acquiring Fund Shares delivered to the Target
Funds shall be delivered at net asset value without a sales load, commission or
other similar fee being imposed. Such transactions shall take place at the
closing provided for in section 3.1 (the "Closing").
A-1
1.2. The assets of each Target Fund to be acquired by the corresponding
Acquiring Fund (the "Assets") shall consist of all assets, including, without
limitation, all cash, cash equivalents, securities, commodities and futures
interests and dividends or interest or other receivables that are owned by the
Target Fund and any deferred or prepaid expenses shown as an asset on the books
of the Target Fund on the Valuation Time (as defined in Section 2.1). The
liabilities of each Target Fund to be assumed by the corresponding Acquiring
Fund (the "Liabilities") shall consist of all liabilities of the Target Fund
existing at the Valuation Time, whether accrued or contingent, known or unknown.
1.3. Immediately upon delivery to a Target Fund of the corresponding
Acquiring Fund Shares, the Target Fund, as the then sole shareholder of the
corresponding Acquiring Fund, shall (i) elect trustees of the New Acquiring
Trust, (ii) approve the advisory and any sub-advisory agreements, (iii) approve
the distribution and service plan pursuant to Rule 12b-1 under the 1940 Act, as
applicable, (iv) ratify the selection of the New Acquiring Trust's independent
accountants, and (v) take such other steps related to the inception of
operations of such Acquiring Fund as deemed necessary or appropriate by the
Trustees of New Acquiring Trust.
1.4. With respect to each pair of Funds, immediately following the
action contemplated by Section 1.3, the Target Fund will distribute to its
shareholders of record (the "Target Fund Shareholders"), determined as of the
Valuation Time (as defined in section 2.1), on a pro rata basis, the
corresponding Acquiring Fund Shares received by the Target Fund pursuant to
section 1.1 and will completely liquidate. Such distribution and liquidation
will be accomplished with respect to the Target Fund by the transfer of the
Acquiring Fund Shares then credited to the account of the Target Fund on the
books of the Acquiring Fund to open accounts on the share records of the
Acquiring Fund in the names of the Target Fund Shareholders. An Acquiring Fund
shall have no obligation to inquire as to the validity, propriety or correctness
of such records, but shall assume that such transaction is valid, proper and
correct. With respect to each pair of Funds, the aggregate net asset value of
the Acquiring Fund Shares to be so credited to the Target Fund Shareholders
shall be equal to the aggregate net asset value of the Target Fund shares owned
by such shareholders on the Closing Date. All issued and outstanding shares of
the Target Fund will simultaneously be cancelled on the books of the Target
Fund. Acquiring Funds will not issue certificates representing Acquiring Fund
Shares issued in connection with such exchanges.
1.5. Ownership of Acquiring Fund Shares of each Acquiring Fund will be
shown on its books.
1.6. Any reporting responsibility of a Target Fund including, without
limitation, the responsibility for filing of regulatory reports, tax returns, or
other documents with the Securities and Exchange Commission (the "Commission"),
any state securities commission, and any federal, state or local tax authorities
or any other relevant regulatory authority, is and shall remain the
responsibility of the Target Fund.
1.7. All books and records of a Target Fund, including all books and
records required to be maintained under the Investment Company Act of 1940, as
amended (the "1940 Act"), and the rules and regulations thereunder, shall be
available to the corresponding Acquiring Fund from and after the Closing Date
and shall be turned over to the corresponding Acquiring Fund as soon as
practicable following the Closing Date.
1.8. In order to bind all holders of Target Fund shares to the
transactions contemplated hereby, and in particular in order to bind them to the
cancellation and retirement of the outstanding Target Fund shares held by them,
each Target Fund shall, prior to the Closing Date, (a) seek to obtain
shareholder approval pursuant to Minnesota law of an amendment to Target
Company's articles of
A-2
incorporation substantially in the form attached hereto as Schedule B (the
"Amendment"), and (b) file the Amendment with the Secretary of State of
Minnesota. The Amendment as actually filed shall refer only to those Target
Funds whose shareholders approved the Amendment.
2. VALUATION
2.1. With respect to each pair of Funds, the value of the Assets shall
be computed as of the date and time ("Valuation Time") that is the close of
regular trading on the New York Stock Exchange (the "NYSE") on the Closing Date
(as defined in section 3.1) after the declaration and payment of any dividends
and/or other distributions on the Closing Date, using such valuation procedures
as are disclosed in the then-current prospectus and/or statement of additional
information for the Acquiring Fund and as have been approved by its Board of
Trustees, copies of which have been delivered to the Target Fund.
2.2. All computations of value hereunder shall be made by or under the
direction of each Fund's respective accounting agent, if applicable, in
accordance with its regular practice and the requirements of the 1940 Act, and
shall be subject to confirmation by each Fund's respective independent
accountants upon the reasonable request of the other Fund.
3. CLOSING AND CLOSING DATE
3.1. The Closing of the transactions contemplated by this Agreement
shall be March 31, 2004, or such later date as the parties may agree in writing
(the "Closing Date"). All acts taking place at the Closing shall be deemed to
take place immediately after of 4:00 p.m., Eastern time, on the Closing Date,
unless otherwise agreed to by the parties. The Closing shall be held at the
offices of New Acquiring Trust, _____, or at such other place and time as the
parties may agree.
3.2. Each Target Fund shall deliver to the corresponding Acquiring Fund
on the Closing Date a schedule of Assets.
3.3. With respect to each pair of Funds, the Target Fund shall direct
Wells Fargo Bank Minnesota, N.A., as custodian for the Target Fund, to deliver
at the Closing a certificate of an authorized officer stating that (a) the
Assets shall have been delivered in proper form to Wells Fargo Bank Minnesota,
N.A., as custodian for the corresponding Acquiring Fund, prior to or on the
Closing Date and (b) all necessary taxes in connection with the delivery of the
Assets, including all applicable federal and state stock transfer stamps, if
any, have been paid or provision for payment has been made. The Target Fund's
portfolio securities represented by a certificate or other written instrument
shall be presented by the custodian for the Target Fund to the custodian for the
Acquiring Fund for examination no later than five business days preceding the
Closing Date and transferred and delivered by the Target Fund as of the Closing
Date by the Target Fund for the account of the Acquiring Fund duly endorsed in
proper form for transfer in such condition as to constitute good delivery
thereof. The Target Fund's portfolio securities and instruments deposited with a
securities depository, as defined in Rule 17f-4 under the 1940 Act, shall be
delivered as of the Closing Date by book entry in accordance with the customary
practices of such depositories and the custodian for the Acquiring Fund. The
cash to be transferred by the Target Fund shall be delivered by wire transfer of
federal funds on the Closing Date.
3.4. Each Target Fund shall direct Bisys Fund Services Ohio, Inc.
("Transfer Agent"), as transfer agent for the Target Fund, to deliver at the
Closing a certificate of an authorized officer stating that its records contain
the names and addresses of the Target Fund Shareholders and the number and
percentage ownership (to three decimal places) of outstanding Target Fund
shares, as applicable, owned
A-3
by each such shareholder immediately prior to the Closing. The corresponding
Acquiring Fund shall issue and deliver a confirmation evidencing the Acquiring
Fund Shares to be credited on the Closing Date to the Target Fund or provide
evidence satisfactory to the Target Fund that such Acquiring Fund Shares have
been credited to that Target Fund's account on the books of such Acquiring Fund.
At the Closing, each party shall deliver to the other such bills of sale,
checks, assignments, share certificates, if any, receipts or other documents as
such other party or its counsel may reasonably request to effect the
transactions contemplated by this Agreement.
3.5. In the event that immediately prior to the Valuation Time (a) the
primary trading market for portfolio securities of a Target Fund or a
corresponding Acquiring Fund shall be closed to trading or trading thereupon
shall be restricted, or (b) trading or the reporting of trading thereupon or
elsewhere shall be disrupted so that, in the judgment of the Board members of
either party to this Agreement, accurate appraisal of the value of the net
assets with respect to the Acquiring Fund Shares or the shares of Target Fund is
impracticable, the Closing Date shall be postponed until the first business day
after the day when trading shall have been fully resumed and reporting shall
have been restored.
3.6. The liabilities of each Target Fund shall include all of such
Target Fund's liabilities, debts, obligations and duties of whatever kind or
nature, whether absolute, accrued, contingent or otherwise, whether or not
arising in the ordinary course of business, whether or not determinable at the
Closing Date, and whether or not specifically referred to in this Agreement,
including but not limited to any deferred compensation to such Target Fund's
board members.
4. REPRESENTATIONS AND WARRANTIES
4.1. With respect to each pair of Funds, except as has been fully
disclosed to the Acquiring Fund prior to the date of this Agreement in a written
instrument executed by an appropriate officer of Target Company, Target Company,
on behalf of the corresponding Target Fund, represents and warrants to the
Acquiring Fund as follows:
(a) Target Fund is duly designated as a series of Target
Company, which is a corporation duly organized and validly existing
under the laws of the State of Minnesota, with power under Target
Company's Articles of Incorporation, as amended and supplemented from
time to time, to own all of its Assets and to carry on its business as
it is now being conducted and, subject to approval of shareholders of
Target Fund, to carry out this Agreement. Target Fund is qualified to
do business in all jurisdictions in which it is required to be so
qualified, except jurisdictions in which the failure to so qualify
would not reasonably be expected to have a material adverse effect on
Target Fund. Target Fund has all material federal, state and local
authorizations necessary to own all of its Assets and to carry on its
business as now being conducted, except authorizations that the failure
to so obtain would not reasonably be expected to have a material
adverse effect on Target Fund;
(b) The Target Fund is registered with the Commission as an
open-end management investment company under the 1940 Act, and such
registration is in full force and effect and the Target Fund is in
compliance in all material respects with the 1940 Act and the rules and
regulations thereunder;
(c) No consent, approval, authorization, or order of any court
or governmental authority is required for the consummation by the
Target Fund of the transactions contemplated herein, except such as
have been obtained under the Securities Act of 1933, as amended (the
A-4
"1933 Act"), the Securities Exchange Act of 1934, as amended (the "1934
Act") and the 1940 Act and such as may be required by state securities
laws;
(d) The Target Fund is not, and the execution, delivery and
performance of this Agreement by the Target Fund, will not, (i) result
in a material violation of Minnesota law or of its Articles of
Incorporation or By-Laws; (ii) result in a material violation or breach
of, or constitute a default under, any material agreement, indenture,
instrument, contract, lease or other undertaking to which the Target
Fund is a party or by which it is bound, or the acceleration of any
obligation, or the imposition of any penalty, under any agreement,
indenture, instrument, contract, lease, judgment or decree to which the
Target Fund is a party or by which it is bound; or (iii) result in the
creation or imposition of any lien, charge or encumbrance or any
property or assets of the Target Fund;
(e) All material contracts or other commitments of the Target
Fund (other than this Agreement and any contracts listed on Schedule C)
will terminate without liability to the Target Fund on or prior to the
Closing Date. Each contract listed on Schedule C is a valid, binding
and enforceable obligation of each party thereto and the assignment by
the Target Fund to the corresponding Acquiring Fund of each such
contract will not result in the termination of such contract, any
breach or default thereunder or the imposition of any penalty
thereunder;
(f) No material litigation or administrative proceeding or
investigation of or before any court or governmental body is presently
pending or to its knowledge threatened against the Target Fund or any
properties or assets held by it. The Target Fund knows of no facts that
might form the basis for the institution of such proceedings that would
materially and adversely affect its business and is not a party to or
subject to the provisions of any order, decree or judgment of any court
or governmental body which materially and adversely affects its
business or its ability to consummate the transactions herein
contemplated;
(g) The Statement of Assets and Liabilities, Statement of
Operations, Statement of Changes in Net Assets and Financial Highlights
of the Target Fund at and for the fiscal year ended July 31, 2003, have
been audited by Deloitte & Touche LLP, and are in accordance with GAAP
consistently applied, and such statements (a copy of each of which has
been furnished to Acquiring Fund) present fairly, in all material
respects, the financial position of the Target Fund as of such date in
accordance with GAAP, and there are no known contingent liabilities of
the Target Fund required to be reflected on a balance sheet (including
the notes thereto) in accordance with GAAP as of such date not
disclosed therein;
(h) Since July 31, 2003, there has not been any material
adverse change in the Target Fund's financial condition, assets,
liabilities or business other than changes occurring in the ordinary
course of business, or any incurrence by the Target Fund of
indebtedness maturing more than one year from the date such
indebtedness was incurred except as otherwise disclosed to and accepted
in writing by the corresponding Acquiring Fund. For purposes of this
subsection (h), a decline in net asset value per share of the Target
Fund due to declines in market values of securities in the Target
Fund's portfolio, the discharge of the Target Fund liabilities, or the
redemption of Target Fund shares by Target Fund Shareholders shall not
constitute a material adverse change;
(i) At the date hereof and at the Closing Date, all federal
and other tax returns and reports of the Target Fund required by law to
have been filed by such dates (including any
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extensions) shall have been filed and are or will be correct in all
material respects, and all federal and other taxes shown as due or
required to be shown as due on said returns and reports shall have been
paid or provision shall have been made for the payment thereof, and, to
the best of the Target Fund's knowledge, no such return is currently
under audit and no assessment has been asserted with respect to such
returns;
(j) For each taxable year of its operation (including the
taxable year that includes the Closing Date), the Target Fund has met
the requirements of Subchapter M of the Code for qualification and
treatment as a regulated investment company and has elected to be
treated as such, and has been eligible to and has computed its federal
income tax under Section 852 of the Code;
(k) All issued and outstanding shares of the Target Fund (i)
have been offered and sold in every state and the District of Columbia
in compliance in all material respects with applicable registration
requirements of the 1933 Act and state securities laws, (ii) are, and
on the Closing Date will be, duly and validly issued and outstanding,
fully paid and non-assessable and not subject to preemptive or
dissenter's rights, and (iii) will be held at the time of the Closing
by the persons and in the amounts set forth in the records of the
Transfer Agent, as provided in section 3.4. The Target Fund does not
have outstanding any options, warrants or other rights to subscribe for
or purchase any of the Target Fund shares, nor is there outstanding any
security convertible into any of the Target Fund shares;
(l) At the Closing Date, the Target Fund will have good and
marketable title to the Assets to be transferred to the corresponding
Acquiring Fund pursuant to section 1.2 and full right, power and
authority to sell, assign, transfer and deliver such Assets hereunder
free of any liens or other encumbrances and upon delivery and payment
for such Assets, such Acquiring Fund will acquire good and marketable
title thereto, subject to no restrictions on the full transfer thereof,
including such restrictions as might arise under the 1933 Act and the
1940 Act;
(m) The execution, delivery and performance of this Agreement
will have been duly authorized prior to the Closing Date by all
necessary action on the part of the Board members of Target Company,
(including the determinations required by Rule 17a-8(a) under the 1940
Act), and, subject to the approval of this Agreement and the Amendment
by the Target Fund Shareholders, this Agreement constitutes a valid and
binding obligation of the Target Fund, enforceable in accordance with
its terms, subject, as to enforcement, to bankruptcy, insolvency,
fraudulent transfer, reorganization, moratorium and other laws relating
to or affecting creditors' rights and to general equity principles;
(n) The information to be furnished by the Target Fund for use
in applications for orders, registration statements or proxy materials
or for use in any other document filed or to be filed with any federal,
state or local regulatory authority (including the National Association
of Securities Dealers, Inc. (the "NASD")), which may be necessary in
connection with the transactions contemplated hereby, shall be accurate
and complete in all material respects and shall comply in all material
respects with federal securities and other laws and regulations
applicable thereto;
(o) At the Closing Date, the then current prospectus and
statement of additional information of the Target Fund conform in all
material respects to the applicable requirements of the 1933 Act and
the 1940 Act and the rules and regulations of the Commission thereunder
and
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do not include any untrue statement of a material fact or omit to state
any material fact required to be stated therein or necessary to make
the statements therein, in light of the circumstances under which they
were made, not materially misleading; and
(p) The Proxy Statement (as defined in section 5.7), insofar
as it relates to the Target Fund, will, on the effective date of the
Registration Statement and on the Closing Date, (i) comply in all
material respects with the provisions and Regulations of the 1933 Act,
1934 Act and 1940 Act, as applicable, and (ii) not contain any untrue
statement of a material fact or omit to state a material fact required
to be stated therein or necessary to make the statements therein, in
light of the circumstances under which such statements are made, not
materially misleading; provided, however, that the representations and
warranties in this section shall not apply to statements in or
omissions from the Proxy Statement and the Registration Statement made
in reliance upon and in conformity with information that was furnished
or should have been furnished by Acquiring Fund for use therein.
4.2. With respect to each pair of Funds, except as has been fully
disclosed to the Target Fund prior to the date of this Agreement in a written
instrument executed by an appropriate officer of New Acquiring Trust, New
Acquiring Trust, on behalf of the corresponding Acquiring Fund, represents and
warrants to the Target Fund as follows:
(a) The Acquiring Fund is duly organized as a series of New
Acquiring Trust, which is a statutory trust duly organized and validly
existing under the laws of the State of Delaware with the power under
New Acquiring Trust's Declaration of Trust to own all of its properties
and assets and to carry on its business as contemplated by this
Agreement;
(b) New Acquiring Trust is registered with the Commission as
an open-end management investment company under the 1940 Act, and such
registration is in full force and effect and Acquiring Fund is in
compliance in all material respects with the 1940 Act and the rules and
regulations thereunder, and the registration of Acquiring Fund Shares
will be in full force and effect on the Closing Date;
(c) No consent, approval, authorization, or order of any court
or governmental authority is required for the consummation by Acquiring
Fund of the transactions contemplated herein, except such as have been
obtained under the 1933 Act, the 1934 Act and the 1940 Act and such as
may be required by state securities laws;
(d) The Acquiring Fund is not, and the execution, delivery and
performance of this Agreement by the Acquiring Fund will not, (i)
result in a material violation of Delaware law or its then current
Declaration of Trust or By-Laws; (ii) result in a material violation or
breach of or constitute a default under, any material agreement,
indenture, instrument, contract, lease or other undertaking to which
New Acquiring Trust, on behalf of the Acquiring Fund, is a party or by
which it is bound, or (ii) the acceleration of any obligation, or the
imposition of any penalty, under any agreement, indenture, instrument,
contract, lease, judgment or decree to which New Acquiring Trust, on
behalf of the Acquiring Fund, is a party or by which it is bound; nor
(iii) result in the creation or imposition of any lien, charge or
encumbrance on any property or assets of the Acquiring Fund;
(e) No material litigation or administrative proceeding or
investigation of or before any court or governmental body is presently
pending or to its knowledge threatened against the
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Acquiring Fund or any properties or assets held by it. The Acquiring
Fund knows of no facts that might form the basis for the institution of
such proceedings that would materially and adversely affect its
business and is not a party to or subject to the provisions of any
order, decree or judgment of any court or governmental body which
materially and adversely affects its business or its ability to
consummate the transactions herein contemplated;
(f) Acquiring Fund will meet the requirements of Subchapter M
of the Code for qualification as a regulated investment company for its
first taxable year that ends after the Closing Date and will be
eligible to, and will for such taxable year, compute its Federal income
tax under Section 852 of the Code;
(g) Upon consummation of the Reorganization, all issued and
outstanding Acquiring Fund Shares will be duly and validly issued and
outstanding, fully paid and non-assessable by New Acquiring Trust and
will have been offered and sold in every state, territory and the
District of Columbia in compliance in all material respects with
applicable registration requirements of the 1933 Act and other
securities laws. The Acquiring Fund does not have outstanding any
options, warrants or other rights to subscribe for or purchase any
Acquiring Fund Shares, nor is there outstanding any security
convertible into any Acquiring Fund Shares;
(h) The execution, delivery and performance of this Agreement
will have been duly authorized prior to the Closing Date by all
necessary action on the part of the Board members of New Acquiring
Trust (including the determinations required by Rule 17a-8(a) under the
1940 Act), and this Agreement will constitute a valid and binding
obligation of New Acquiring Trust, on behalf of the Acquiring Fund,
enforceable in accordance with its terms, subject, as to enforcement,
to bankruptcy, insolvency, fraudulent transfer, reorganization,
moratorium and other laws relating to or affecting creditors' rights
and to general equity principles;
(i) The information to be furnished by the Acquiring Fund for
use in applications for orders, registration statements or proxy
materials or for use in any other document filed or to be filed with
any federal, state or local regulatory authority (including the NASD),
which may be necessary in connection with the transactions contemplated
hereby, shall be accurate and complete in all material respects and
shall comply in all material respects with federal securities and other
laws and regulations applicable thereto;
(j) At the Closing Date, the then current prospectus and
statement of additional information of the Acquiring Fund conform in
all material respects to the applicable requirements of the 1933 Act
and the 1940 Act and the rules and regulations of the Commission
thereunder and do not include any untrue statement of a material fact
or omit to state any material fact required to be stated therein or
necessary to make the statements therein, in light of the circumstances
under which they were made, not materially misleading;
(k) Prior to the Closing Date, the Acquiring Fund will have
carried on no business activity and will have had no assets or
liabilities other than the seed capital required by Section 14(a) of
the 1940 Act.
5. COVENANTS OF ACQUIRING FUND OR TARGET FUND OR BOTH
5.1. Each Target Fund covenants to operate its business in the ordinary
course between the date hereof and the Closing Date, it being understood that
(a) such ordinary course of business will
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include (i) the declaration and payment of customary dividends and other
distributions and (ii) such changes as are contemplated by the Target Fund's
normal operations.
5.2. Each Target Fund covenants that, upon reasonable notice, the
corresponding Acquiring Fund's officers and agents shall have reasonable access
to the Target Fund's books and records necessary to maintain current knowledge
of the Target Fund and to ensure that the representations and warranties made by
the Target Fund are accurate.
5.3. Each Target Fund covenants to call a meeting of Target Fund
Shareholders entitled to vote thereon to consider and act upon this Agreement
and the Amendment and to take all other reasonable action necessary to obtain
approval of the transactions contemplated herein. Such meeting shall be
scheduled for no later than June 30, 2004.
5.4. Each Target Fund covenants that the corresponding Acquiring Fund
Shares to be issued hereunder are not being acquired for the purpose of making
any distribution thereof other than in accordance with the terms of this
Agreement.
5.5. Each Target Fund covenants that it will assist the corresponding
Acquiring Fund in obtaining such information as such Acquiring Fund reasonably
requests concerning the beneficial ownership of the Target Fund shares.
5.6. With respect to each pair of Funds, each of Acquiring Fund and
Target Fund, on behalf of itself, covenants that, subject to the provisions of
this Agreement, it will take, or cause to be taken, all actions, and do or cause
to be done, all things reasonably necessary, proper and/or advisable to
consummate and make effective the transactions contemplated by this Agreement.
5.7. Each Target Fund covenants that it will prepare, file with the
Commission, and deliver to the corresponding Acquired Fund Shareholders in
connection with such meeting, a proxy statement on Schedule 14A ("Proxy
Statement") in compliance in all material respects with the provisions of the
1934 Act and the rules and regulations thereunder.
5.8. Each Acquiring Fund covenants that it will provide the
corresponding Target Fund with information reasonably necessary for the
preparation of the Proxy Statement in compliance with the 1934 Act and 1940 Act
and the rules and regulations thereunder.
5.9. Each Target Fund covenants that it will, from time to time, as and
when reasonably requested by the corresponding Acquiring Fund, execute and
deliver or cause to be executed and delivered all such assignments and other
instruments, and will take or cause to be taken such further action as such
Acquiring Fund may reasonably deem necessary or desirable in order to vest in
and confirm such Acquiring Fund's title to and possession of all the Assets and
otherwise to carry out the intent and purpose of this Agreement.
5.10. Each Acquiring Fund covenants to use all reasonable efforts to
obtain the approvals and authorizations required by the 1933 Act and 1940 Act,
and such of the state securities laws as it deems appropriate in order to
continue its operations after the Closing Date and to consummate the
transactions contemplated herein; provided, however, that such Acquiring Fund
may take such actions it reasonably deems advisable after the Closing Date as
circumstances change.
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5.11. Each Fund shall use its reasonable best efforts to fulfill or
obtain the fulfillment of the conditions precedent to effect the transactions
contemplated by this Agreement as promptly as practicable.
6. CONDITIONS PRECEDENT TO OBLIGATIONS OF TARGET FUND
With respect to the Reorganization, the obligations of each Target Fund
to consummate the transactions provided for herein shall be subject, at its
election, to the performance by the corresponding Acquiring Fund of all the
obligations to be performed by it hereunder on or before the Closing Date, and,
in addition thereto, the following further conditions:
6.1. All representations and warranties of New Acquiring Trust, on
behalf of the corresponding Acquiring Fund, contained in this Agreement shall be
true and correct in all material respects as of the date hereof and, except as
they may be affected by the transactions contemplated by this Agreement, as of
the Closing Date, with the same force and effect as if made on and as of the
Closing Date.
6.2. The Acquiring Fund shall have delivered to the Target Fund on the
Closing Date a certificate executed in its name by its President or a Vice
President, in a form reasonably satisfactory to New Acquiring Trust, on behalf
of the Target Fund, and dated as of the Closing Date, to the effect that the
representations and warranties of New Acquiring Trust with respect to the
Acquiring Fund made in this Agreement are true and correct on and as of the
Closing Date, except as they may be affected by the transactions contemplated by
this Agreement, and as to such other matters as the Target Fund shall reasonably
request.
6.3. The Acquiring Fund shall have performed all of the covenants and
complied with all of the provisions required by this Agreement to be performed
or complied with by the Acquiring Fund on or before the Closing Date.
7. CONDITIONS PRECEDENT TO OBLIGATIONS OF ACQUIRING FUND
With respect to the Reorganization, the obligations of each Acquiring
Fund to consummate the transactions provided for herein shall be subject, at its
election, to the performance by the corresponding Target Fund of all of the
obligations to be performed by it hereunder on or before the Closing Date and,
in addition thereto, the following further conditions:
7.1. All representations and warranties of such Target Fund contained
in this Agreement shall be true and correct in all material respects as of the
date hereof and, except as they may be affected by the transactions contemplated
by this Agreement, as of the Closing Date, with the same force and effect as if
made on and as of the Closing Date.
7.2. The Target Fund shall have delivered to the Acquiring Fund a
statement of the Target Fund's Assets and liabilities as of the Closing Date,
certified by the Treasurer of the Target Fund.
7.3. The Target Fund shall have delivered to the Acquiring Fund on the
Closing Date a certificate executed in its name by its President or a Vice
President, in a form reasonably satisfactory to the Acquiring Fund, and dated as
of the Closing Date, to the effect that the representations and warranties of
the Target Fund made in this Agreement are true and correct on and as of the
Closing Date, except as they may be affected by the transactions contemplated by
this Agreement, and as to such other matters as the Acquiring Fund shall
reasonably request.
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7.4. The Target Fund shall have performed all of the covenants and
complied with all of the provisions required by this Agreement to be performed
or complied with by the Target Fund on or before the Closing Date.
8. FURTHER CONDITIONS PRECEDENT TO OBLIGATIONS OF ACQUIRING FUND AND
TARGET FUND
With respect to each pair of Funds, if any of the conditions set forth
below have not been met on or before the Closing Date with respect to a Target
Fund or Acquiring Fund, the other party to this Agreement shall, at its option,
not be required to consummate the transactions contemplated by this Agreement:
8.1. This Agreement, the Amendment, and the transactions contemplated
herein and therein, with respect to the Target Fund, shall have been approved by
the requisite vote of the holders of the outstanding shares of the Target Fund
in accordance with the provisions of the Target Fund's Articles of Incorporation
and By-Laws, applicable Minnesota law and the 1940 Act, and certified copies of
the resolutions evidencing such approval shall have been delivered to Acquiring
Fund; and the Amendment shall have been duly filed with the Secretary of State
of Minnesota. Notwithstanding anything herein to the contrary, neither the
Acquiring Fund nor the Target Fund may waive the conditions set forth in this
section 8.1.
8.2. On the Closing Date, no action, suit or other proceeding shall be
pending or to its knowledge threatened before any court or governmental agency
in which it is sought to restrain or prohibit, or obtain material damages or
other relief in connection with, this Agreement or the transactions contemplated
herein.
8.3. All consents of other parties and all other consents, orders and
permits of federal, state and local regulatory authorities deemed necessary by
the Acquiring Fund or the Target Fund to permit consummation, in all material
respects, of the transactions contemplated hereby shall have been obtained,
except where failure to obtain any such consent, order or permit would not
involve a risk of a material adverse effect on the assets or properties of the
Acquiring Fund or the Target Fund, provided that either party hereto may for
itself waive any of such conditions.
8.4. The Registration Statement with respect to the Acquiring Fund
Shares shall have become effective under the 1933 Act and no stop orders
suspending the effectiveness thereof shall have been issued and, to the best
knowledge of the parties hereto, no investigation or proceeding for that purpose
shall have been instituted or be pending, threatened or contemplated under the
1933 Act.
8.5. With respect to the Reorganization, the parties shall have
received an opinion of Dechert LLP addressed to each Acquiring Fund and Target
Fund, in a form reasonably satisfactory to each such party, substantially to the
effect that, based upon certain facts, assumptions and representations of the
parties, for federal income tax purposes: (i) the transfer to each Acquiring
Fund of all of the assets of the corresponding Target Fund in exchange solely
for such Acquiring Fund Shares and the assumption by such Acquiring Fund of all
of the liabilities of the Target Fund, followed by the distribution of such
shares to the Target Fund Shareholders in exchange for their shares of the
Target Fund in complete liquidation of the Target Fund, will constitute a
"reorganization" within the meaning of Section 368(a)(1) of the Code, and such
Acquiring Fund and the Target Fund will each be "a party to a reorganization"
within the meaning of Section 368(b) of the Code; (ii) no gain or loss will be
recognized by the Target Fund upon the transfer of all of its assets to such
Acquiring Fund in exchange solely for such Acquiring
A-11
Fund Shares and the assumption by such Acquiring Fund of all of the liabilities
of the Target Fund; (iii) the basis of the assets of the Target Fund in the
hands of such Acquiring Fund will be the same as the basis of such assets of the
Target Fund immediately prior to the transfer; (iv) the holding period of the
assets of the Target Fund in the hands of such Acquiring Fund will include the
period during which such assets were held by the Target Fund; (v) no gain or
loss will be recognized by such Acquiring Fund upon the receipt of the assets of
the Target Fund in exchange for such Acquiring Fund Shares and the assumption by
Acquiring Fund of all of the liabilities of Target Fund; (vi) no gain or loss
will be recognized by the Target Fund Shareholders upon the receipt of such
Acquiring Fund Shares solely in exchange for their shares of the Target Fund as
part of the transaction; (vii) the basis of such Acquiring Fund Shares received
by the Target Fund Shareholders will be the same as the basis of the shares of
the Target Fund exchanged therefor; and (viii) the holding period of such
Acquiring Fund Shares received by Target Fund Shareholders will include the
holding period during which the shares of the Target Fund exchanged therefor
were held, provided that at the time of the exchange the shares of the Target
Fund were held as capital assets in the hands of the Target Fund Shareholders.
The delivery of such opinion is conditioned upon receipt by Dechert LLP of
representations it shall request of New Acquiring Trust and the Target Fund.
Notwithstanding anything herein to the contrary, neither such Acquiring Fund nor
the Target Fund may waive the condition set forth in this section 8.5. No
opinion will be expressed by Dechert LLP, however, as to whether any gain or
loss will be recognized by a Target Fund or Acquiring Fund in connection with
any dispositions of assets by such Fund prior to or following its
Reorganization.
8.6. The Target Fund and the Acquiring Fund shall have agreed on the
number of full and fractional Acquiring Fund Shares to be issued in connection
with the Reorganization after such number has been calculated in accordance with
paragraph 1.1.
9. INDEMNIFICATION
9.1. Each Acquiring Fund agrees to indemnify and hold harmless the
corresponding Target Fund and each of such Target Fund's Board members and
officers from and against any and all losses, claims, damages, liabilities or
expenses (including, without limitation, the payment of reasonable legal fees
and reasonable costs of investigation) to which jointly and severally, such
Target Fund or any of its Board members or officers may become subject, insofar
as any such loss, claim, damage, liability or expense (or actions with respect
thereto) arises out of or is based on any breach by such Acquiring Fund of any
of its representations, warranties, covenants or agreements set forth in this
Agreement.
9.2. Each Target Fund agrees to indemnify and hold harmless the
corresponding Acquiring Fund and each of such Acquiring Fund's Board members and
officers from and against any and all losses, claims, damages, liabilities or
expenses (including, without limitation, the payment of reasonable legal fees
and reasonable costs of investigation) to which jointly and severally, such
Acquiring Fund or any of its Board members or officers may become subject,
insofar as any such loss, claim, damage, liability or expense (or actions with
respect thereto) arises out of or is based on any breach by such Target Fund of
any of its representations, warranties, covenants or agreements set forth in
this Agreement.
10. FEES AND EXPENSES
10.1. Each of New Acquiring Trust, on behalf of each Acquiring Fund,
and Target Company, on behalf of each Target Fund, represents and warrants to
the other that it has no obligations to pay any brokers or finders fees in
connection with the transactions provided for herein.
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10.2. Voyageur Asset Management, Inc. ("Voyageur") will bear all the
expenses associated with the Reorganization, except that Acquiring Fund will
bear all SEC registration fees (which are currently estimated to be $_____). Any
such expenses which are so borne by Voyageur will be solely and directly related
to the Reorganization within the meaning of Revenue Ruling 73-54, 1973-1 C.B.
187. Target Fund Shareholders will pay their own expenses, if any, incurred in
connection with the Reorganization.
11. ENTIRE AGREEMENT; SURVIVAL OF WARRANTIES
11.1. Each Fund agrees that no party has made any representation,
warranty or covenant not set forth herein and that this Agreement constitutes
the entire agreement between the parties.
11.2. Except as specified in the next sentence set forth in this
section 11.2, the representations, warranties and covenants contained in this
Agreement or in any document delivered pursuant hereto or in connection herewith
shall not survive the consummation of the transactions contemplated hereunder.
The covenants to be performed after the Closing and the obligations of each of
Acquiring Funds and Target Funds in sections 9.1 and 9.2 shall survive the
Closing.
12. TERMINATION
This Agreement may be terminated and the transactions contemplated
hereby may be abandoned by any party as it relates to the transactions
applicable to such party (i) by the mutual agreement of the parties, or (ii) by
either party if the Closing shall not have occurred on or before July 15, 2004,
unless such date is extended by mutual agreement of the parties, or (iii) by
either party if the other party shall have materially breached its obligations
under this Agreement or made a material and intentional misrepresentation herein
or in connection herewith; or (iv) upon the resolution of either of the Board of
Trustees of New Acquiring Trust or the Board of Directors of Target Company, at
any time prior to the Closing Date, if circumstances should develop that, in the
opinion of that Board, make proceeding with the Agreement inadvisable with
respect to New Acquiring Trust or Target Company, respectively. In the event of
any such termination, this Agreement shall become void and there shall be no
liability hereunder on the part of any party or their respective Board members
or officers, except for any such material breach or intentional
misrepresentation, as to each of which all remedies at law or in equity of the
party adversely affected shall survive.
13. AMENDMENTS
This Agreement may be amended, modified or supplemented in such manner
as may be mutually agreed upon in writing by any authorized officer of Target
Company and any authorized officer of New Acquiring Trust; provided, however,
that following the meeting of Target Fund Shareholders called by Target Company
pursuant to section 5.3 of this Agreement, no such amendment may have the effect
of changing the provisions for determining the number of Acquiring Fund Shares
to be issued to Target Fund Shareholders under this Agreement to the detriment
of such shareholders without their further approval.
14. NOTICES
Any notice, report, statement or demand required or permitted by any
provisions of this Agreement shall be in writing and shall be deemed duly given
if delivered by hand (including by Federal Express or similar express courier)
or transmitted by facsimile or three days after being mailed by prepaid
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registered or certified mail, return receipt requested, addressed to the
applicable Target Fund, _____, with a copy to Dechert LLP, 200 Clarendon Street,
Boston, Massachusetts 02116, Attention: Joseph R. Fleming, Esq., or to the
applicable Acquiring Fund, _____, with a copy to Dechert LLP, 200 Clarendon
Street, Boston, Massachusetts 02116, Attention: Joseph R. Fleming, Esq., or to
any other address that Target Funds or Acquiring Fund shall have last designated
by notice to the other party.
15. HEADINGS; COUNTERPARTS; ASSIGNMENT; LIMITATION OF LIABILITY
15.1. The Article and section headings contained in this Agreement are
for reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement.
15.2. This Agreement may be executed in any number of counterparts,
each of which shall be deemed an original.
15.3. This Agreement shall bind and inure to the benefit of the parties
hereto and their respective successors and assigns, but no assignment or
transfer hereof or of any rights or obligations hereunder shall be made by any
party without the written consent of the other party. Nothing herein expressed
or implied is intended or shall be construed to confer upon or give any person,
firm or corporation, other than the parties hereto and the shareholders of each
Acquiring Fund and Target Fund and their respective successors and assigns, any
rights or remedies under or by reason of this Agreement.
15.4. Notwithstanding anything to the contrary contained in this
Agreement, the obligations, agreements, representations and warranties with
respect to each Fund shall constitute the obligations, agreements,
representations and warranties of that Fund only (the "Obligated Fund"), and in
no event shall any other series of New Acquiring Trust or the assets of any such
series be held liable with respect to the breach or other default by the
Obligated Fund of its obligations, agreements, representations and warranties as
set forth herein.
15.5. This Agreement shall be governed by, and construed and enforced
in accordance with, the laws of the State of Delaware without regard to its
principles of conflicts of laws.
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IN WITNESS WHEREOF, each of the parties hereto has caused this
Agreement to be executed by an authorized officer and its seal to be affixed
thereto and attested by its Secretary or Assistant Secretary.
Attest: TAMARACK FUNDS TRUST,
on behalf of each Acquiring Fund
By: ----------------------------------
Its:
- ---------------------------------- ----------------------------------
Secretary
Attest: GREAT HALL INVESTMENT FUNDS, INC.,
on behalf of each Target Fund
By: ----------------------------------
Its:
- ---------------------------------- ----------------------------------
Secretary
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Schedule A
----------
- -------------------------------------------------------------------------------------------------------------------------------
TARGET FUNDS ACQUIRING FUNDS
- -------------------------------------------------------------------------------------------------------------------------------
Great Hall Institutional Money Market Fund
(represented by Target Company's Series F Common
Shares, without designation as to series, also known
as Investor Shares
- -------------------------------------------------------------------------------------------------------------------------------
Great Hall Institutional Tax-Free Money Market Fund
(represented by Target Company's Series G Common
Shares, without designation as to series, also known
as Investor Shares)
- -------------------------------------------------------------------------------------------------------------------------------
Great Hall Prime Money Market Fund (represented by
Target Company's Series A Common Shares, without
designation as to series, also known as Investor
Shares)
- -------------------------------------------------------------------------------------------------------------------------------
Great Hall Tax-Free Money Market Fund (represented
by Target Company's Series C Common Shares,
without designation as to series, also known as
Investor Shares)
- -------------------------------------------------------------------------------------------------------------------------------
Great Hall U.S. Government Money Market Fund
(represented by Target Company's Series B Common
Shares, without designation as to series, also known
as Investor Shares)
- -------------------------------------------------------------------------------------------------------------------------------
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Schedule B
----------
ARTICLES OF AMENDMENT
TO
RESTATED ARTICLES OF INCORPORATION
OF
GREAT HALL INVESTMENT FUNDS, INC.
The undersigned officer of Great Hall Investment Funds, Inc. (the
"Corporation"), a Minnesota corporation which is subject to the provisions of
Minnesota Statutes, Chapter 302A, hereby certifies that the following amendment
to the Corporation's restated articles of incorporation has been adopted by the
Board of Directors and by the requisite vote of shareholders of the Corporation
pursuant to said Chapter 302A:
WHEREAS, the Corporation is registered as an open-end management
investment company (i.e., a mutual fund) under the Investment Company
Act of 1940 and offers its shares to the public in several series, each
of which represents a separate and distinct portfolio of assets;
WHEREAS, it is desirable and in the best interests of the holders of
the Corporation's series of common stock identified in the table below
as the "Target Funds" that the assets belonging to such Target Funds be
sold to the respective series of [name of shell Delaware business
trust], a Delaware statutory trust (the "New Acquiring Trust"),
identified in the table below as the "Acquiring Funds," in exchange for
shares of the respective Acquiring Funds, which shares will be
distributed pro rata to the former shareholders of the Target Funds:
Target Funds (series Acquiring Funds (series of the
of the Corporation) New Acquiring Trust
-------------------- ------------------------------
Series A Common Shares (known as
Prime Money Market Fund)
Series B Common Shares (known as
U.S. Government Money Market Fund)
Series C Common Shares (known as
Tax-Free Money Market Fund)
Series F Common Shares (known as
Institutional Prime Money Market
Fund)
Series G Common Shares (known as
Institutional Tax-Free Money Market
Fund)
A-17
WHEREAS, each of the Target Funds presently has outstanding shares of
only one class, which is without designation as to class within the
lettered series of shares referred to in the Corporation's restated
articles of incorporation and which is known as "Investor Shares;"
WHEREAS, the Corporation and the New Acquiring Trust have entered into
an Agreement and Plan of Reorganization dated ______________, 200___
providing for the foregoing transactions (the "Reorganization
Agreement"); and
WHEREAS, the Reorganization Agreement requires that, in order to bind
all holders of shares of the respective series of the Corporation which
constitute Target Funds to the foregoing transactions, and in
particular to bind such holders to the cancellation and retirement of
their outstanding shares of the Corporation, it is necessary to adopt
an amendment to the Corporation's amended and restated articles of
incorporation.
NOW, THEREFORE, BE IT RESOLVED, that the Corporation's restated
articles of incorporation be, and the same hereby are, amended to add
the following Article 5C immediately following Article 5B thereof:
5A. (a) For purposes of this Article 5C, the following terms
shall have the following meanings:
The terms "Target Funds," "Acquiring Funds," and
"Reorganization Agreement" shall have the meanings set forth in the
preamble to the Articles of Amendment which added this Article 5C to
the Corporation's restated articles of incorporation.
The term "Closing Date" shall have the meaning set forth in
the Reorganization Agreement.
(b) At the Closing Date, the assets belonging to each Target
Fund, the Special Liabilities associated therewith, and the General
Assets and General Liabilities allocated to such Target Fund, shall be
transferred to the corresponding Acquiring Fund for Investor Shares of
such Acquiring Fund, all as set forth in the Reorganization Agreement.
Such Acquiring Fund shares shall be distributed to Target Fund
shareholders as set forth in (c) below. For purposes of the foregoing,
the terms "assets belonging to," "Special Liabilities," "General
Assets," and "General Liabilities" have the meanings assigned to them
in Articles 7(b), 7(c), and 7(d) of the Corporation's restated articles
of incorporation.
(c) At the Closing Date, each issued and outstanding share of
each Target Fund shall be, without further action, exchanged for that
number of such Investor Shares of the corresponding Acquiring Fund
determined in accordance with Sections 1 and 2 of the Reorganization
Agreement, and such Target Fund shares shall be cancelled and retired.
The distribution of the Acquiring Fund shares to Target Fund
shareholders shall be accomplished in the manner set forth in Section
1.4 of the Reorganization Agreement.
A-18
(d) From and after the Closing Date, the Target Fund shares
cancelled and retired pursuant to (c) above shall have the status of
authorized and unissued shares of the Corporation, without designation
as to series or class. If all outstanding series of the Corporation
participate in the foregoing transactions as "Target Funds," their
shareholders' approval of such transactions also shall constitute their
approval of the Corporation's dissolution and winding up pursuant to
the Minnesota Business Corporation Act.
IN WITNESS WHEREOF, the undersigned officer of the Corporation has
executed these Articles of Amendment on behalf of the Corporation on
____________, 200___.
GREAT HALL INVESTMENT FUNDS, INC.
By:
----------------------------------
Its:
----------------------------------
A-19
Schedule C
----------
A-20
EXHIBIT B
CURRENT EXECUTIVE OFFICERS OF THE COMPANY
TERM OF OFFICE
POSITION(S) WITH AND LENGTH OF PRINCIPAL OCCUPATION(S) DURING
NAME, ADDRESS(1) AND AGE THE COMPANY TIME SERVED PAST 5 YEARS
====================================================================================================================================
Jennifer Lammers Chief Executive One year; Managing Director, Voyageur Asset Management (2000 to
Officer since 2003. present); Mutual Fund Services Director, Voyageur Asset
Age: 42 Management (2003 to present); Chief Financial Officer,
Great Hall Investment Funds, Inc. (2001-2003);
Compliance Officer, Great Hall Investment Funds, Inc.
(2000-2001); Director of Finance, Voyageur Asset
Management (2000-2003); Vice President and Manager,
Financial Reporting, RBC Dain Rauscher (1998-2000);
President and Chief Executive Officer(2).
Raye C. Kanzenbach Chief Investment One year; Senior Managing Director and Chief Investment
Officer since 1997. Officer of Voyageur.
Age: 54
Christopher J. Tomas Treasurer, Chief One year; Vice President and Finance Manager, RBC Dain Rauscher
Financial Officer since 2003. (2001 to present); Senior Financial Analyst, RBC Dain
Age: 33 Rauscher (1999-2001); Financial Analyst, RBC Dain Rauscher
(1997-1999); Treasurer, Chief Financial Officer and
Principal Accounting Officer(2).
Martin A. Cramer Vice President, One year; Legal and Regulatory Affairs Vice President, Chief Compliance
Assistant Secretary, since 2003. Officer and Secretary, J&B (mutual fund management company);
Age: 53 Chief Compliance Vice President, Assistant Secretary, Chief Compliance Officer
Officer and AML and AML Compliance Officer(2); and formerly, Vice President,
Compliance Officer Chief Compliance Officer and Secretary, Buffalo Fund Complex
and Secretary, Gold Bank Funds(3).
Laura Moret Secretary One year; Vice President and Senior Associate Counsel, RBC Dain Rauscher
since 2003. (2002-present); Vice President and Group Counsel,
Age: 49 American Express Financial Advisors (1995-2002); Secretary(2).
(1) The address for each officer is 60 South Sixth Street, Minneapolis,
Minnesota 55402.
(2) Great Hall Investment Funds, Inc., RBC Funds, Inc., J&B Funds, Babson
Enterprise Fund, Inc., Babson Enterprise Fund II, Inc., Babson-Stewart
Ivory International Fund, Inc., Babson Value Fund, Inc., David L. Babson
Growth Fund, Inc., D.L. Babson Bond Trust, D.L. Babson Money Market Fund,
Inc., D.L. Babson Tax-Free Income Fund, Inc., Shadow Stock Fund, Inc. and
Investors Mark Series Fund, Inc.
B-1
(3) The Buffalo Fund Complex consists of Buffalo Balanced Fund, Inc., Buffalo
Large Cap Fund, Inc., Buffalo High Yield Fund, Inc., Buffalo Small Cap
Fund, Inc., Buffalo USA Global Fund, Inc. and the Buffalo Funds, which is
a series fund consisting of Buffalo Science & Technology Fund and Buffalo
Mid Cap Fund. Gold Bank Funds is a series fund consisting of Gold Bank
Equity and Gold Bank Money Market Fund.
B-2
EXHIBIT C
COMPARISON OF THE TAMARACK FUNDS TRUST AND THE COMPANY
The following is a summary of certain characteristics of the operations of the
Tamarack Funds Trust (the "New Trust"), a Delaware statutory trust, and the
Company, a Minnesota corporation, their respective corporate governance
documents and relevant state law. The following is not a complete description of
the documents cited. Shareholders should refer to the provisions of such
documents and state laws governing the New Trust and the Company for a more
thorough description.
SHAREHOLDER LIABILITY
New Trust
The Declaration of Trust of the New Trust provides that shareholders are not
personally liable for the debts, liabilities, obligations and expenses incurred
by, contracted for, or otherwise existing with respect to the New Trust, the
Tamarack Funds or any class of shares. In addition, shareholders have the same
limitation of personal liability as is extended to shareholders of a Delaware
for-profit corporation.
Company
The Company is organized as a Minnesota corporation, and as such, its
shareholders generally have no personal liability for its acts or obligations.
LIQUIDATION OR DISSOLUTION
Generally, in the event of the liquidation or dissolution of any of the Funds or
Tamarack Funds, as the case may be, the shareholders of that Fund/Tamarack Fund
are entitled to receive, when and as declared by the Board, the excess of the
assets over the liabilities belonging to the Fund/Tamarack Fund. The assets so
distributed to shareholders of a Fund/Tamarack Fund would be distributed among
the shareholders in proportion to the number of shares of that Fund/Tamarack
Fund held by them and recorded on the books of the Fund/Tamarack Fund.
New Trust
The Declaration of Trust of the New Trust permits a majority of the Trustees to
liquidate the New Trust, or any class or series of the New Trust, upon written
notice to shareholders, without submitting the matter for shareholder approval.
Company
Minnesota law generally requires shareholder approval of a dissolution of the
Company. If all outstanding shares of a Fund, or a class of a Fund, have been
redeemed, exchanged, or otherwise acquired by the Company, such shares return to
the status of authorized and unissued shares without designation as to Fund (if
no shares of such Fund remain outstanding) or with the same designation as to
Fund, but no designation as to class within such Fund, and all provisions of the
Company's articles of incorporation relating to such Fund, or such class of such
Fund, cease to be of further effect and cease to be a part of the Company's
Articles of Incorporation. Upon the occurrence of such an event, the Board has
the power, without shareholder approval, to cause restated Articles of
Incorporation to be filed that reflect the removal from the Articles of
Incorporation of all such provisions relating to such Fund, or such class of
such Fund.
LIABILITY OF DIRECTORS/TRUSTEES
New Trust
Absent willful misfeasance, bad faith, gross negligence or reckless disregard of
a Trustee's duties, a Trustee acting in such capacity shall not be personally
liable to any person other than the New Trust or a beneficial owner for any act,
omission or obligation of the New Trust or any Trustee. A Trustee or officer of
the New
C-1
Trust will be indemnified by the New Trust to the fullest extent permitted by
law against liability and against all expenses reasonably incurred or paid by
him or in connection with the defense of any proceeding in which he or she
becomes involved by virtue of being or having been a Trustee or officer.
Company
The Articles of Incorporation of the Company provide that, to the fullest extent
permitted by the Minnesota Business Corporation Act (except as prohibited by the
1940 Act), a Director is not liable to the Company or its shareholders for
monetary damages for breach of fiduciary duty as a Director. The Articles of
Incorporation also provide that the Company will indemnify Directors for such
expenses and liabilities, and to the full extent, permitted by the Minnesota
Business Corporation Act, except as prohibited by the 1940 Act.
RIGHTS OF INSPECTION
New Trust
Shareholders shall have the right to inspect the New Trust's accounts, books or
documents only to the extent such right is conferred by the Trustees.
Company
The Minnesota Business Corporation Act provides that a shareholder has, upon
written demand stating the purpose of the demand, a right at any reasonable time
to examine and copy a corporation's share register and other corporate records
reasonably related to the stated purpose and described with reasonable
particularity in the written demand. The shareholder must demonstrate that the
stated purpose is a proper purpose, as that term is defined in the Minnesota
Business Corporation Act.
SHAREHOLDER MEETINGS
Neither the New Trust nor the Company is required to hold annual meetings of
shareholders (other than in a year in which the election of directors is
required by the 1940 Act), although the New Trust and the Company may hold
special meetings at any time. However, the Minnesota Business Corporation Act
provides that, if a regular meeting of shareholders has not been held during the
immediately preceding 15 months, a shareholder or shareholders holding 3% or
more of the voting power of all shares entitled to vote may demand a regular
meeting of shareholders by written notice of demand given to the chief executive
officer or the chief financial officer of the corporation.
When a shareholder meeting is held by either the New Trust or the Company, all
shares entitled to vote on any matters submitted to a vote of the shareholders
are voted in the aggregate, except when (1) required by the 1940 Act, shares are
voted by the individual Fund or Tamarack Fund; (2) the matter involves any
action that the Directors/Trustees have determined will affect only the
interests of one or more Fund or Tamarack Fund, then only the shareholders of
such series shall be entitled to vote thereon; and (3) the matter involves any
action that the Directors/Trustees have determined will affect only the
interests of one or more classes, then only the shareholders of such class or
classes shall be entitled to vote thereon.
New Trust
The By-Laws for the New Trust permit special meetings of the shareholders to be
called by shareholders holding at least 10% of the outstanding shares of the New
Trust entitled to vote at such meeting. Shareholders may also take action in
lieu of a meeting by written instrument signed by the holders of outstanding
shares representing the minimum number of votes that would be necessary to
authorize or take that action at a meeting.
Delaware law generally provides greater flexibility with regard to shareholder
voting rights, and proxy requirements. The Declaration of Trust provides that
33-1/3% of the shares entitled to vote at any meeting must be present in person
or by proxy to establish a proper quorum for voting purposes, unless a larger
quorum is required by applicable law, by the By-Laws of the Trust, or by the
Declaration of Trust. Further, when a quorum is present, a majority of votes
cast shall decide any issues, and a plurality shall elect a Trustee of the
C-2
New Trust, unless a larger vote is required by the governing documents or under
applicable law. The effect of the quorum and voting provisions is to make it
easier for the New Trust to seek appropriate shareholder approvals for many
actions not related to regulatory issues without experiencing the added costs or
delays of soliciting additional proxies or votes and without being disadvantaged
by abstentions or broker non-votes. Delaware also affords trustees the ability
to adapt a Delaware statutory trust to future contingencies. For example,
trustees have the authority to incorporate a Delaware statutory trust, to merge
or consolidate a Delaware statutory trust or its series with another entity, to
cause multiple series of a Delaware statutory trust to become separate trusts,
to change the state of domicile or to liquidate a Delaware statutory trust, all
without having to obtain a shareholder vote.
Company
Under the By-Laws of the Company, a special meeting of shareholders of a Fund
may be called by one or more shareholders holding 10% or more of the shares
entitled to vote on the matters to be presented to the meeting.
Under the By-Laws of the Company, the holders of 10% of the shares outstanding
and entitled to vote constitute a quorum for the transaction of business at any
regular or special meeting. The By-Laws provide that, except as otherwise
specifically provided by the By-Laws or as required by the Investment Company
Act of 1940 or other applicable laws, all questions shall be decided by a
majority vote of the number of shares entitled to vote and represented at a
meeting at the time of the vote. If a matter to be presented at a meeting
relates only to particular classes or series of the Company, then only the
shareholders of such classes or series are entitled to vote on such matter.
Minnesota law generally requires that shareholders may take action by the
affirmative vote of the holders of a majority of the voting power of the shares
present and entitled to vote on that item of business.
REORGANIZATION/COMBINATION TRANSACTIONS
New Trust
Under the Declaration of Trust and Delaware law, the Trustees may generally
authorize mergers, consolidations, share exchanges and reorganizations of a
Tamarack Fund or the New Trust with another trust, series or other business
organization without shareholder approval, although such approval may be
separately required under the federal securities laws and rules thereunder. For
example, the 1940 Act and rules thereunder may require a shareholder vote of a
proposed merger involving affiliated funds under certain circumstances, such as
when the merging funds have materially different advisory contracts or
fundamental investment restrictions.
Company
Under the Minnesota Business Corporation Act, with limited exceptions, a plan of
merger or exchange must first be approved by the Board of Directors and then
approved at a shareholder meeting by the affirmative vote of the holders of a
majority of the voting power of all shares entitled to vote.
AMENDMENT OF CHARTER DOCUMENT
New Trust
The Trustees may generally restate, amend or otherwise supplement the Trust's
governing instrument, which includes the Declaration of Trust and the By-Laws,
without the approval of shareholders, subject to limited exceptions (such as
amendments affecting shareholders' voting rights).
Company
Under the Minnesota Business Corporation Act, amendments to the charter of a
corporation may be proposed by the Board of Directors or by a shareholder or
shareholders holding three percent or more of the voting power of the shares
entitled to vote. Such a proposal must be approved at a shareholder meeting by
the affirmative vote of the holders of the greater of (1) a majority of the
voting power of the shares present and entitled to vote on the proposal, or (2)
a majority of the voting power of the minimum number of the shares entitled to
vote that would constitute a quorum for the transaction of business at the
meeting, except where the Act or the corporation's Articles of Incorporation
require a larger proportion or number. (If the Articles of Incorporation require
a larger
C-3
proportion or number than is required by the Act for a particular action, the
Articles of Incorporation control.) In any case where a class or series of
shares is entitled to vote as a class or series, the proposal being voted upon
must also receive the affirmative vote of the holders of the same proportion of
the shares present of that class or series, or of the total outstanding shares
of that class or series, as the proportion required above, unless the
corporation's Articles of Incorporation require a larger proportion.
DERIVATIVE ACTIONS
New Trust
Shareholders of the New Trust or any Tamarack Fund may not bring a derivative
action to enforce the right of the New Trust or Tamarack Fund unless certain
conditions are satisfied. The conditions include, among others, that (1) the
complaining shareholder submit a written demand to the Board of Trustees and
that demand must be refused, and (2) at least 10% of the shareholders of the New
Trust or the Tamarack Fund, as applicable, join in bringing the derivative
action. A shareholder of a particular Tamarack Fund is not entitled to
participate in a derivative action on behalf of any other Tamarack Fund of the
New Trust.
Company
Under Minnesota law, a shareholder generally may bring a derivative action to
enforce a right of a corporation if the corporation has failed to enforce a
right that may properly have been asserted by it. The complaint filed by the
plaintiff shareholder must describe the efforts, if any, made by the plaintiff
shareholder to obtain the desired action from the Board of Directors and, if
necessary, from the shareholders, and the reasons for the plaintiff
shareholder's failure to obtain the desired action, or for not making the
effort. A derivative action may not be maintained if it appears that the
plaintiff shareholder does not fairly and adequately represent the interest of
the shareholders similarly situated in enforcing the right of the corporation.
C-4
EXHIBIT D
INFORMATION ON CERTAIN MATTERS ON WHICH THE TAMARACK FUNDS WILL VOTE
Each Fund, while it is the sole shareholder of the corresponding Tamarack Fund,
will approve an investment advisory agreement that is substantially the same as
the existing investment advisory agreement for each of the Funds, except as
noted below.
The proposed investment advisory agreement is an agreement by and between the
New Trust, on behalf of each applicable New Fund, and Voyageur that is
substantially similar to the current Investment Advisory Agreement, dated August
29, 1991, by and between the Company, on behalf of its respective Funds, and
Voyageur, with the exceptions noted below. The current Investment Advisory
Agreement is referred to herein as the "Current Advisory Agreement." The
proposed Investment Advisory Agreement is referred to herein as the "New
Advisory Agreement."
CURRENT ADVISORY AGREEMENT. The Current Advisory Agreement between the Company,
on behalf of the Funds, and Voyageur was last approved by Fund shareholders on
[ ]. As of the date of this Proxy Statement, the Board of Directors last
approved the Current Advisory Agreement on November 24, 2003. If not sooner
terminated, the Current Advisory Agreement will continue in effect until
November 24, 2004, and for successive one year periods thereafter, provided that
each continuance is specifically approved annually by (a) the vote of a majority
of the Board who are not parties to the Current Advisory Agreement or interested
persons (as defined in the 1940 Act), cast in person at a meeting called for the
purpose of voting on such approval, and (b) either (i) the vote of a majority of
the outstanding voting securities of the affected Fund, or (ii) the vote of a
majority of the Board. The Current Advisory Agreement is terminable with respect
to a Fund by a vote of the Board, or by the holders of a majority of the
outstanding voting securities of the Fund, at any time without penalty, upon 60
days written notice to Voyageur. Voyageur may also terminate its advisory
relationship with respect to a Fund without penalty upon 60 days written notice
to the Company. The Current Advisory Agreement terminates automatically in the
event of its assignment (as defined in the 1940 Act).
In determining whether to approve the Current Advisory Agreement, the Board
requested, and received from Voyageur, information that the Board believed to be
reasonably necessary to reach their conclusion. The Board considered, with the
assistance of independent counsel, their legal responsibilities and reviewed the
nature and quality of the Voyageur's services provided to each Fund and the
Voyageur's experience, resources and qualifications. In addition to monthly
written reports of each Fund's investment performance relative to broad-based
industry benchmarks and presentations at each regular Board of Directors meeting
by the Voyageur's Chief Investment Officer, the Board reviewed and considered
various factors including:
o a report prepared by Lipper Analytical Services, Inc., comparing the
investment advisory fees and other expenses of each Fund (as a
percentage of assets) and the investment performance of each Fund
(net of fees and expenses) with those of comparable funds, including
a description of the bases upon which funds were selected for
comparison;
o descriptions of transaction allocation practices and assurances that
such practices and arrangements are accurately described in the
Funds' registration statement;
o assurances that Voyageur and its personnel are in compliance with
the Funds' Code of Ethics, policies and procedures and with
applicable laws and regulations;
o a report on Voyageur's profitability related to providing investment
advisory services to the Funds after taking into account (i)
investment advisory fees and any other benefits realized by Voyageur
or any of its affiliates as a result of Voyageur's role as the
investment advisor to the Funds, (ii) the direct and indirect
expenses incurred by Voyageur in providing such investment advisory
services to
D-1
the Funds, (iii) the contractual expense limitation described below,
and (iv) compensation arrangements for the Voyageur's key personnel;
and
o information on the financial condition of Voyageur.
After discussion, the Board of Directors concluded that Voyageur has the
capabilities, resources and personnel necessary to manage the Funds. The Board
of Directors also concluded that, based on the services that Voyageur would
provide to the Funds under the Current Advisory Agreement and the expenses
incurred by Voyageur in the performance of such services, the compensation to be
paid to Voyageur is fair and equitable with respect to each Fund. Based upon
such information as it considered necessary to the exercise of its reasonable
business judgment, the Board of Directors concluded unanimously that it is in
the best interests of each Fund to continue the Current Advisory Agreement with
Voyageur for an additional one-year period.
Under its terms, the Current Advisory Agreement will remain in effect with
respect to each Fund until November 24, 2004 and continue thereafter only as
long as such continuance is approved at least annually (i) by vote of the
holders of a majority of the outstanding voting securities of each Fund or by
the Board of Directors and (ii) by a majority of the Directors who are not
parties to the Investment Advisory Agreement or "interested persons" (as defined
in the 1940 Act) of any such party.
Subsequent to November 24, 2003, the Board of Directors continued to receive
regular updates on the performance of each of the Funds and other matters
relevant to the performance of Voyageur.
PROVISIONS OF THE CURRENT AND NEW ADVISORY AGREEMENTS. Below is a discussion of
the provisions of, and other relevant information concerning, the Current
Advisory Agreement. Unless otherwise noted, the New Advisory Agreement with
respect to the Tamarack Funds are substantially similar to the Current Advisory
Agreement with respect to the Funds.
VOYAGEUR'S RESPONSIBILITIES. Under the terms of the Current Advisory Agreement,
Voyageur furnishes continuing investment supervision to the Funds and is
responsible for the management of each Fund's portfolio. The responsibility for
making decisions to buy, sell or hold a particular security rests with Voyageur,
subject to review by the Board.
COMPENSATION PAID TO VOYAGEUR. Under the Current Advisory Agreement, the Funds
pay Voyageur fees for its services performed pursuant to these agreements. The
fees, which are computed daily and paid monthly, are stated as an annual rates
for each Fund, calculated as a percentage of the particular Fund's average daily
net assets. The fees applicable to each Fund may be found in EXHIBIT E to this
Proxy Statement; the aggregate dollar amount paid to Voyageur in the Funds' most
recent fiscal year may be found in EXHIBIT I. The rate of advisory fees to be
paid to Voyageur under the New Advisory Agreement with respect to the Tamarack
Funds will be the same as under the Current Advisory Agreement for each
corresponding Fund.
VOYAGEUR'S STANDARD OF CARE. The Current Advisory Agreement does not contain a
provision regarding Voyageur's standard of care in connection with Voyageur's
performance of the Agreement. Pursuant to the New Advisory Agreement, Voyageur
will give the Fund the benefit of Voyageur's best judgment and efforts in
rendering investment advisory services. The New Advisory Agreement provides that
Voyageur shall not be liable for any error of judgment or mistake of law or for
any loss suffered by a Fund in connection with the performance of the agreement,
except a loss resulting from a breach of fiduciary duty with respect to the
receipt of compensation for services or a loss resulting from willful
misfeasance, bad faith, or gross negligence on the part of Voyageur in the
performance of its duties, or from reckless disregard by Voyageur of its duties
and obligations thereunder.
USE OF SUB-ADVISORS. The Current Advisory Agreement does not contain provisions
authorizing Voyageur to delegate any or all of its duties to sub-advisors. The
New Advisory Agreement provides that Voyageur is authorized, with respect to any
one or more Funds, to delegate any or all of its rights, duties and obligations
D-2
under the Agreement (subject in any event to all of the limitations, terms and
conditions applicable to Voyageur under the Agreement) to one or more
sub-advisors, and that Voyageur may enter into agreements with sub-advisors, and
may replace any such sub-advisors from time to time in its discretion, in
accordance with applicable requirements of the 1940 Act, the Investment Advisers
Act of 1940, as amended, and rules and regulations thereunder, as amended from
time to time or as interpreted from time to time by the staff of the SEC, and in
accordance with any applicable exemptive orders or similar relief granted by the
SEC. The New Advisory Agreement requires Voyageur to oversee the performance and
services provided by any sub-advisor engaged under the Agreement.
D-3
EXHIBIT E
INFORMATION REGARDING CERTAIN PAYMENTS TO VOYAGEUR AND ITS AFFILIATES
FEES PAID UNDER THE CURRENT ADVISORY AGREEMENTS
The following table provides the amounts paid by each Fund to Voyageur under the
Current Advisory Agreement during the Fund's most recent fiscal year, as well as
the annual fee rate of each Fund under that Agreement.
ADVISORY FEES
RECEIVED BY
VOYAGEUR FOR THE
ADVISORY FEES FISCAL YEAR ENDED
RECEIVED BY VOYAGEUR JULY 31, 2003 AS A
FOR THE FISCAL YEAR PERCENTAGE OF
ENDED JULY 31, 2003 AVERAGE NET ASSETS APPLICABLE FEE RATE
=======================================================================================================================
GREAT HALL INVESTMENT FUNDS, INC.
Great Hall Prime Money Market
Fund $35,412,626* [ ]%* 0.55% on average daily net
assets up to $700 million
0.50% on average daily net
assets of over $700 million
up to $1.2 billion
0.45% on average daily net
assets of over $1.2 billion
up to $2 billion
0.40% on average daily net
assets of over $2 billion.
Great Hall U.S. Government Money $4,082,284* [ ]%* 0.50% of average daily net assets
Market Fund up to $100 million
0.40% on average daily net
assets of over $100 million
up to $300 million
0.35% of average daily net
assets in excess of $300 million
Great Hall Tax-Free Money Market $4,859,088* [ ]%* 0.50% of average daily net assets
Fund
Great Hall Institutional Prime Money $1,218,661 [ ]% 0.25% of average daily net assets
Market Fund
Great Hall Institutional Tax-Free $596,521 [ ]% 0.25% of average daily net assets
Money Market Fund
- --------------
E-1
* Voyageur has contractually agreed to limit expenses for each Fund through
November 30, 2004 so that annual fund operating expenses do not exceed 0.71% for
the Great Hall Prime Money Market Fund, 0.71% for the Great Hall U.S. Government
Money Market Fund and 0.62% for the Great Hall Tax-Free Money Market Fund.
Pursuant to this arrangement, Voyageur's contractual obligation to waive and/or
reimburse expenses is limited to 0.25% per annum of the respective Fund's
average daily net assets. Voyageur may voluntarily waive and/or reimburse
additional fund operating expenses from time to time. Any such voluntary program
may be modified or discontinued at any time without notice.
OTHER FEES PAID TO THE VOYAGEUR
For the fiscal year ended July 31, 2003, the Funds paid Voyageur $[ ] pursuant
to an administrative services agreement between the Funds and Voyageur.
COMMISSIONS PAID TO AFFILIATED BROKERS
For the most recently completed fiscal year, the aggregate amount of commissions
paid by the [NAME OF APPLICABLE FUND] to [BROKER AFFILIATED WITH VOYAGEUR] was
$[ ]. The percentage of the [NAME OF APPLICABLE FUND]'s aggregate brokerage
commissions paid to [BROKER AFFILIATED WITH VOYAGEUR] during the most recently
completed fiscal year was [ ]%.
E-2
EXHIBIT F
OTHER INVESTMENT COMPANIES ADVISED BY VOYAGEUR
Voyageur acts as advisor to the following funds that have investment objectives
similar to the Funds:
- ------------------------------------------------------------------------------------------------------------------------------------
NAME OF FUND INVESTMENT OBJECTIVE NET ASSETS VOYAGEUR'S RATE OF
(AS OF OCT. 31, 2003) ROLE COMPENSATION
- ------------------------------------------------------------------------------------------------------------------------------------
D.L. Babson Money Market Fund, Inc. Maximizing income $28,901,101 investment 0.75%*
consistent with advisor
maintaining the safety
and liquidity of the
Fund's assets and
seeking to maintain a
consistent net asset
value of $1.00 per share.
- ------------------------------------------------------------------------------------------------------------------------------------
- ---------------
* Prior to May 1, 2003, the D.L. Babson Money Market Fund paid a unified fee for
advisory and non-advisory services. The D.L. Babson Money Market Fund's advisory
fee is subject to reduction pursuant to an expense limitation agreement to limit
the its total operating expenses to 0.83% until May 1, 2005.
F-1
EXHIBIT G
PRINCIPAL EXECUTIVE OFFICER AND DIRECTORS OF VOYAGEUR ASSET MANAGEMENT INC.
NAME AND ADDRESS* PRINCIPAL OCCUPATION
=======================================================================
John G. Taft Chief Executive Officer and Director
Lisa Ferris Director
Raye C. Kanzenbach Senior Managing Director; Senior
Portfolio Manager
- --------
* The address for each officer and director is 90 South Seventh Street,
Suite 4300, Minneapolis, Minnesota 55402.
G-1
EXHIBIT H
CURRENT INVESTMENT POLICIES/RESTRICTIONS
PRIME MONEY MARKET FUND, U.S. GOVERNMENT MONEY MARKET FUND, AND TAX-FREE MONEY
MARKET FUND
As fundamental investment policies/restrictions, Prime Money Market Fund, U.S.
Government Money Market Fund, and Tax-Free Money Market Fund may not:
(1) purchase common stocks, preferred stocks, warrants or other equity
securities;
(2) purchase securities, if immediately after such purchase more than 5%
of its total assets would be invested in the securities of any one issuer
(excluding securities issued or guaranteed by the U.S. Government, its agencies
or instrumentalities), except that, subject to applicable SEC rules [(see the
discussion of Rule 2a-7 above)], up to 25% of its total assets may be invested
without regard to this 5% limitation;
(3) invest more than 25% of its total assets in any one industry, except
that (i) with respect to Tax-Free Fund, this restriction shall not apply to
municipal obligations; (ii) with respect to Prime Fund and Tax-Free Fund this
restriction shall not apply to securities issued or guaranteed by United States
banks or United States branches of foreign banks that are subject to the same
regulation as United States banks; and (iii) this restriction shall not apply to
securities issued or guaranteed by the U.S. Government, its agencies or
instrumentalities. If the issuer of a security is within a given industry and
the security is guaranteed by an entity within a different industry, the
industry of the guarantor rather than that of the issuer shall be deemed to be
the industry for purposes of applying the foregoing test;
(4) invest more than 5% of its assets in securities of issuers which, with
their predecessors, have a record of less than three years continuous operation.
(Securities of such issuers will not be deemed to fall within this limitation if
they are guaranteed by an entity in continuous operation, with its predecessor,
for more than three years);
(5) borrow money, except for temporary or emergency non-investment
purposes such as to accommodate abnormally heavy redemption requests, and then
only in an amount not exceeding 5% of the value of its total assets at the time
of borrowing;
(6) pledge, mortgage or hypothecate its assets, except that to secure
borrowings permitted by (5) above, it may pledge securities having a market
value at the time of such pledge not exceeding 15% of its total assets;
(7) sell securities short or purchase any securities on margin, except for
such short-term credits as are necessary for clearance of portfolio
transactions;
(8) write, purchase or sell put or call options, straddles, spreads or any
combination thereof except that Tax-Free Fund may acquire rights to resell
obligations [as set forth herein under "Great Hall Tax-Free Money Market Fund
and Institutional Tax-Free Money Market Fund -- Variable and Floating Rate
Demand Municipal Obligations" and "Stand-By Commitments"];
(9) underwrite any securities issued by others;
(10) purchase or sell real estate or real estate mortgage loans (although
the Funds may invest in obligations secured by interests in real estate),
commodities, commodity contracts (including futures contracts), real estate
partnership interests and oil, gas and mineral leases;
(11) make loans, other than by entering into repurchase agreements and
through the purchase of other permitted investments in accordance with its
investment objective and policies; provided, however, that it may not enter into
a repurchase agreement if, as a result thereof, more than 10% of its total
assets would be subject to repurchase agreements maturing in more than seven
days;
H-1
(12) invest in companies for the purpose of exercising control or
management of another company; or
(13) invest in securities of other investment companies, except as they
may be acquired as part of a merger, consolidation or acquisition of assets.
"Investment companies" refers only to companies registered as investment
companies under the 1940 Act.
With respect to the application of the 5% limitation contained in investment
restriction (2) above to Tax-Free Money Market Fund, the non-governmental user
of facilities financed by industrial development or pollution control revenue
bonds and a financial institution issuing a letter of credit or comparable
guarantee supporting a variable rate demand municipal obligation are considered
to be issuers. In addition to the above restrictions and limitations, Tax-Free
Money Market Fund may not purchase securities that are not municipal obligations
and the income from which is subject to federal income tax, if such purchase
would cause more than 20% of its total assets to be invested in such securities,
except that Tax-Free Money Market Fund may invest more than 20% of its total
assets in such securities during other than normal market conditions. Bonds
subject to the alternative minimum tax are considered taxable for this test.
INSTITUTIONAL PRIME MONEY MARKET FUND AND INSTITUTIONAL TAX-FREE MONEY MARKET
FUND
As fundamental investment policies/restrictions, Institutional Prime Money
Market Fund and Institutional Tax-Free Money Market Fund may not:
(1) borrow money or issue senior securities (as defined in the Investment
Company Act of 1940, as amended), except for temporary or emergency
non-investment purposes such as to accommodate abnormally heavy redemption
requests, and then only in an amount not exceeding 5% of the value of its total
assets at the time of borrowing;
(2) underwrite securities issued by other persons, except insofar as a
Fund may be deemed an underwriter under the Securities Act of 1933, as amended,
in selling portfolio securities;
(3) invest more than 25% of its total assets in any one industry, except
that (i) with respect to Institutional Tax-Free Fund, this restriction shall not
apply to municipal obligations; (ii) with respect to Institutional Prime Fund
and Institutional Tax-Free Fund this restriction shall not apply to securities
issued or guaranteed by United States banks or United States branches of foreign
banks that are subject to the same regulation as United States banks; and (iii)
this restriction shall not apply to securities issued or guaranteed by the U.S.
Government, its agencies or instrumentalities. If the issuer of a security is
within a given industry and the security is guaranteed by an entity within a
different industry, the industry of the guarantor rather than that of the issuer
shall be deemed to be the industry for purposes of applying the foregoing test;
(4) purchase or sell real estate or real estate mortgage loans (although a
Fund may invest in obligations secured by interests in real estate),
commodities, commodity contracts (including futures contracts), real estate
partnership interests and oil, gas and mineral leases; or
(5) make loans, other than by entering into repurchase agreements and
through the purchase of other permitted investments in accordance with its
investment objective and policies.
H-2
EXHIBIT I
PRINCIPAL SHAREHOLDERS OF THE FUNDS
CONTROL PERSONS AND PRINCIPAL HOLDERS OF SECURITIES. As of [DATE], the following
person(s) owned of record or were known by the Funds to own beneficially 5% or
more of any class of the Funds' shares.
AMOUNT AND NATURE OF PERCENTAGE OF CLASS
NAME OF FUND AND CLASS NAME AND ADDRESS BENEFICIAL OWNERSHIP OUTSTANDING (%)
==================================================================================================================================
GREAT HALL INVESTMENT FUNDS, INC.
- ---------------------------------
Prime Money Market Fund
U.S. Government Money Market Fund
Tax-Free Money Market Fund
Institutional Prime Money Market Fund
Institutional Tax-Free Money Market Fund
I-1
[FORM OF PROXY CARD FOR GREAT HALL TAX-FREE MONEY MARKET FUND]
The shares represented by a properly executed proxy card
will be voted as specified on the proxy card.
GREAT HALL TAX-FREE MONEY THIS PROXY IS SOLICITED ON BEHALF OF
MARKET FUND (THE "FUND"), THE BOARD OF DIRECTORS
A SERIES OF GREAT HALL SPECIAL MEETING OF SHAREHOLDERS
INVESTMENT FUNDS, INC. MARCH 15, 2004 - 9:00 A.M. CENTRAL TIME
(THE "COMPANY") (THE "MEETING")
The undersigned appoints Jennifer Lammers, Laura Moret, Christopher J. Tomas and
Martin A. Cramer, and each of them individually with power to act without the
other and with the right of substitution in each, the proxies of the undersigned
to vote all shares of the Fund held by the undersigned on January 15, 2004, at
the Meeting, to be held at the offices of RBC Dain Rauscher Corporation, 60
South Sixth Street, Minneapolis, Minnesota, on March 15, 2004 at 9 a.m. Central
Time and at any adjournment thereof, with all powers the undersigned would
possess if present in person. All previous proxies given with respect to the
Meeting are revoked. The undersigned acknowledges receipt of the Notice of
Special Meeting and Proxy Statement dated [EFFECTIVE DATE].
PLEASE VOTE, DATE AND SIGN,
AND PROMPTLY RETURN THIS PROXY
CARD IN THE ENCLOSED ENVELOPE PROVIDED.
Dated: ____________________________
__________________________________________
(Signature) (SIGN IN THE BOX)
Please sign exactly as your name or names
appear to the left. When shares are held by
joint tenants, both should sign. When
signing as attorney, executor,
administrator, trustee, guardian or in any
other representative capacity, please give
full title as such. If signing for a
corporation, please sign in full corporate
name by authorized person. If a
partnership, please sign in partnership
name by authorized person.
PLEASE FILL IN BOXES AS SHOWN USING BLACK OR BLUE INK OR NUMBER 2 PENCIL. [X]
PLEASE DO NOT USE FINE POINT PENS. IF NO SPECIFICATION IS MADE, THE SHARES WILL
BE VOTED "FOR" ALL ITEMS, AS APPLICABLE.
FOR WITHHOLD FOR ALL
ALL ALL EXCEPT
1. To approve the election of the following individuals to the board of
directors of the Company: (01) T. Geron Bell, (02) Lucy Hancock Bode, (03) [ ] [ ] [ ]
Leslie H. Garner, Jr., (04) Ronald James, (05) Michael T. Lee, (06) John A.
MacDonald, (07) H. David Rybolt, (08) James R. Seward, and (09) Jay H. Wein.
(INSTRUCTION: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL, MARK THE BOX
"FOR ALL EXCEPT" AND WRITE THE NOMINEE'S(S') NAME(S) ON THE LINE BELOW.)
- -------------------------------------------------
FOR AGAINST ABSTAIN
2. To approve an Agreement and Plan of Reorganization, pursuant to which the [ ] [ ] [ ]
Fund would be reorganized as a separate portfolio of Tamarack Funds Trust, a
newly-created Delaware statutory trust.
FOR AGAINST ABSTAIN
3. To approve the modification of the fundamental investment restrictions
regarding:
Modification of policies that must remain fundamental:
3.A Diversification [ ] [ ] [ ]
3.B Borrowing [ ] [ ] [ ]
3.C Senior Securities [ ] [ ] [ ]
3.D Underwriting Securities [ ] [ ] [ ]
3.E Real Estate [ ] [ ] [ ]
3.F Making Loans [ ] [ ] [ ]
3.G Concentration of Investments [ ] [ ] [ ]
3.H Commodities [ ] [ ] [ ]
Reclassification of certain fundamental investment restrictions as
non-fundamental:
3.I Pledging, Mortgaging and Hypothecating Fund Assets [ ] [ ] [ ]
3.J Investments for Control [ ] [ ] [ ]
3.K Investments in Other Investment Companies [ ] [ ] [ ]
3.L Writing and Selling Options [ ] [ ] [ ]
3.M Margin Activities and Short Selling [ ] [ ] [ ]
3.N Unseasoned Companies [ ] [ ] [ ]
3.O Investments in Equity Securities [ ] [ ] [ ]
3.P Investments in Non-Municipal Obligations. [ ] [ ] [ ]
FOR AGAINST ABSTAIN
4. To ratify the selection of Deloitte & Touche LLP as the independent [ ] [ ] [ ]
auditors of the Fund for the current fiscal year.
THE PERSONS NAMED AS PROXIES WILL VOTE IN THEIR DISCRETION ON ANY OTHER
BUSINESS THAT MAY PROPERLY COME BEFORE THE MEETING OR ANY ADJOURNMENTS
OR POSTPONEMENTS THEREOF
(PLEASE SIGN AND DATE ON REVERSE)
[FORM OF PROXY CARD FOR
GREAT HALL PRIME MONEY MARKET FUND AND
GREAT HALL U.S. GOVERNMENT MONEY MARKET FUND]
The shares represented by a properly executed proxy card
will be voted as specified on the proxy card.
[NAME OF FUND] (THE "FUND"), THIS PROXY IS SOLICITED ON BEHALF OF
A SERIES OF GREAT HALL THE BOARD OF DIRECTORS
INVESTMENT FUNDS, INC. SPECIAL MEETING OF SHAREHOLDERS
(THE "COMPANY") MARCH 15, 2004 - 9:00 A.M. CENTRAL TIME
(THE "MEETING")
The undersigned appoints Jennifer Lammers, Laura Moret, Christopher J. Tomas and
Martin A. Cramer, and each of them individually with power to act without the
other and with the right of substitution in each, the proxies of the undersigned
to vote all shares of the Fund held by the undersigned on January 15, 2004, at
the Meeting, to be held at the offices of RBC Dain Rauscher Corporation, 60
South Sixth Street, Minneapolis, Minnesota, on March 15, 2004 at 9 a.m. Central
Time and at any adjournment thereof, with all powers the undersigned would
possess if present in person. All previous proxies given with respect to the
Meeting are revoked. The undersigned acknowledges receipt of the Notice of
Special Meeting and Proxy Statement dated [EFFECTIVE DATE].
PLEASE VOTE, DATE AND SIGN,
AND PROMPTLY RETURN THIS PROXY
CARD IN THE ENCLOSED ENVELOPE PROVIDED.
Dated: ____________________________
__________________________________________
(Signature) (SIGN IN THE BOX)
Please sign exactly as your name or names
appear to the left. When shares are held by
joint tenants, both should sign. When
signing as attorney, executor,
administrator, trustee, guardian or in any
other representative capacity, please give
full title as such. If signing for a
corporation, please sign in full corporate
name by authorized person. If a
partnership, please sign in partnership
name by authorized person.
PLEASE FILL IN BOXES AS SHOWN USING BLACK OR BLUE INK OR NUMBER 2 PENCIL. [X]
PLEASE DO NOT USE FINE POINT PENS. IF NO SPECIFICATION IS MADE, THE SHARES WILL
BE VOTED "FOR" ALL ITEMS, AS APPLICABLE.
FOR WITHHOLD FOR ALL
ALL ALL EXCEPT
1. To approve the election of the following individuals to the board of
directors of the Company: (01) T. Geron Bell, (02) Lucy Hancock Bode, (03) [ ] [ ] [ ]
Leslie H. Garner, Jr., (04) Ronald James, (05) Michael T. Lee, (06) John A.
MacDonald, (07) H. David Rybolt, (08) James R. Seward, and (09) Jay H. Wein.
(INSTRUCTION: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL, MARK THE BOX
"FOR ALL EXCEPT" AND WRITE THE NOMINEE'S(S') NAME(S) ON THE LINE BELOW.)
- -------------------------------------------------
FOR AGAINST ABSTAIN
2. To approve an Agreement and Plan of Reorganization, pursuant to which the [ ] [ ] [ ]
Fund would be reorganized as a separate portfolio of Tamarack Funds Trust, a
newly-created Delaware statutory trust.
FOR AGAINST ABSTAIN
3. To approve the modification of the fundamental investment restrictions
regarding:
Modification of policies that must remain fundamental:
3.A Diversification [ ] [ ] [ ]
3.B Borrowing [ ] [ ] [ ]
3.C Senior Securities [ ] [ ] [ ]
3.D Underwriting Securities [ ] [ ] [ ]
3.E Real Estate [ ] [ ] [ ]
3.F Making Loans [ ] [ ] [ ]
3.G Concentration of Investments [ ] [ ] [ ]
3.H Commodities [ ] [ ] [ ]
Reclassification of certain fundamental investment restrictions as
non-fundamental:
3.I Pledging, Mortgaging and Hypothecating Fund Assets [ ] [ ] [ ]
3.J Investments for Control [ ] [ ] [ ]
3.K Investments in Other Investment Companies [ ] [ ] [ ]
3.L Writing and Selling Options [ ] [ ] [ ]
3.M Margin Activities and Short Selling [ ] [ ] [ ]
3.N Unseasoned Companies [ ] [ ] [ ]
3.O Investments in Equity Securities. [ ] [ ] [ ]
FOR AGAINST ABSTAIN
4. To ratify the selection of Deloitte & Touche LLP as the independent [ ] [ ] [ ]
auditors of the Fund for the current fiscal year.
THE PERSONS NAMED AS PROXIES WILL VOTE IN THEIR DISCRETION ON ANY OTHER
BUSINESS THAT MAY PROPERLY COME BEFORE THE MEETING OR ANY ADJOURNMENTS
OR POSTPONEMENTS THEREOF
(PLEASE SIGN AND DATE ON REVERSE)
[FORM OF PROXY CARD FOR
GREAT HALL INSTITUTIONAL PRIME MONEY MARKET FUND AND
GREAT HALL INSTITUTIONAL TAX-FREE MONEY MARKET FUND]
The shares represented by a properly executed proxy card
will be voted as specified on the proxy card.
[NAME OF FUND] (THE "FUND"), THIS PROXY IS SOLICITED ON BEHALF OF
A SERIES OF GREAT HALL THE BOARD OF DIRECTORS
INVESTMENT FUNDS, INC. SPECIAL MEETING OF SHAREHOLDERS
(THE "COMPANY") MARCH 15, 2004 - 9:00 A.M. CENTRAL TIME
(THE "MEETING")
The undersigned appoints Jennifer Lammers, Laura Moret, Christopher J. Tomas and
Martin A. Cramer, and each of them individually with power to act without the
other and with the right of substitution in each, the proxies of the undersigned
to vote all shares of the Fund held by the undersigned on January 15, 2004, at
the Meeting, to be held at the offices of RBC Dain Rauscher Corporation, 60
South Sixth Street, Minneapolis, Minnesota, on March 15, 2004 at 9 a.m. Central
Time and at any adjournment thereof, with all powers the undersigned would
possess if present in person. All previous proxies given with respect to the
Meeting are revoked. The undersigned acknowledges receipt of the Notice of
Special Meeting and Proxy Statement dated [EFFECTIVE DATE].
PLEASE VOTE, DATE AND SIGN,
AND PROMPTLY RETURN THIS PROXY
CARD IN THE ENCLOSED ENVELOPE PROVIDED.
Dated: ____________________________
__________________________________________
(Signature) (SIGN IN THE BOX)
Please sign exactly as your name or names
appear to the left. When shares are held by
joint tenants, both should sign. When
signing as attorney, executor,
administrator, trustee, guardian or in any
other representative capacity, please give
full title as such. If signing for a
corporation, please sign in full corporate
name by authorized person. If a
partnership, please sign in partnership
name by authorized person.
PLEASE FILL IN BOXES AS SHOWN USING BLACK OR BLUE INK OR NUMBER 2 PENCIL. [X]
PLEASE DO NOT USE FINE POINT PENS. IF NO SPECIFICATION IS MADE, THE SHARES WILL
BE VOTED "FOR" ALL ITEMS, AS APPLICABLE.
FOR WITHHOLD FOR ALL
ALL ALL EXCEPT
1. To approve the election of the following individuals to the board of
directors of the Company: (01) T. Geron Bell, (02) Lucy Hancock Bode, (03) [ ] [ ] [ ]
Leslie H. Garner, Jr., (04) Ronald James, (05) Michael T. Lee, (06) John A.
MacDonald, (07) H. David Rybolt, (08) James R. Seward, and (09) Jay H. Wein.
(INSTRUCTION: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL, MARK THE BOX
"FOR ALL EXCEPT" AND WRITE THE NOMINEE'S(S') NAME(S) ON THE LINE BELOW.)
- -------------------------------------------------
FOR AGAINST ABSTAIN
2. To approve an Agreement and Plan of Reorganization, pursuant to which the [ ] [ ] [ ]
Fund would be reorganized as a separate portfolio of Tamarack Funds Trust, a
newly-created Delaware statutory trust.
FOR AGAINST ABSTAIN
3. To approve the modification of the fundamental investment restrictions
regarding:
Modification of policies that must remain fundamental:
3.B Borrowing [ ] [ ] [ ]
3.C Senior Securities [ ] [ ] [ ]
3.D Underwriting Securities [ ] [ ] [ ]
3.E Real Estate [ ] [ ] [ ]
3.F Making Loans [ ] [ ] [ ]
3.G Concentration of Investments [ ] [ ] [ ]
3.H Commodities. [ ] [ ] [ ]
[ ] [ ] [ ]
4. To ratify the selection of Deloitte & Touche LLP as the independent FOR AGAINST ABSTAIN
auditors of the Fund for the current fiscal year. [ ] [ ] [ ]
THE PERSONS NAMED AS PROXIES WILL VOTE IN THEIR DISCRETION ON ANY OTHER
BUSINESS THAT MAY PROPERLY COME BEFORE THE MEETING OR ANY ADJOURNMENTS
OR POSTPONEMENTS THEREOF
(PLEASE SIGN AND DATE ON REVERSE)