As filed with the Securities and Exchange Commission on November 16, 2001.
File No. 333-71994
U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form N-14
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 [ ]
Pre-Effective Amendment No. 1 [X]
Post-Effective Amendment No. _____ [ ]
INVESTEC FUNDS
(Formerly Guinness Flight Investment Funds)
(Exact name of Registrant as Specified in Trust Instrument)
1055 Washington Blvd., 3rd Floor
Stamford, Connecticut 06901
___________________________________________________
(Address of Principal Executive Office) (Zip Code)
(800) 362-5365
(Area Code and Telephone Number)
Susan Penry-Williams, Esq.
Kramer Levin Naftalis & Frankel LLP
919 Third Avenue
New York, New York 10022
____________________________________
(Name and Address of Agent for Service)
Copy to
Mr. Royce N. Brennen
Investec Funds
1055 Washington Blvd., 3rd Floor
Stamford, Connecticut 06901
Approximate Date of Proposed Public Offering: As soon as practicable after
this Registration Statement becomes effective.
Title of Securities Being Registered: Shares of Beneficial Interest.
No Filing Fee is due because of reliance on Section 24(f) of the Investment
Company Act of 1940, as amended.
Registrant proposes that the filing become effective, pursuant to Rule 488
under the Securities Act of 1933, as amended.
PRELIMINARY PROXY MATERIALS FOR THE INFORMATION
OF THE SECURITIES AND EXCHANGE COMMISSION
INVESTEC FUNDS
Investec Asia New Economy Fund
800-915-6565
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
The Investec Funds (the "Trust") will host a special meeting of
shareholders of the Investec Asia New Economy Fund (the "Fund") on December 27,
2001, at 3:00 p.m. Eastern Time (the "Meeting"). The Meeting will be held at the
Fund's offices, located at 1055 Washington Blvd., 3rd Floor, Stamford,
Connecticut. At the Meeting, shareholders will be asked to consider and act upon
the following proposal:
To reorganize the Fund into the Investec Asia Small Cap Fund; and
To transact such other business as may properly come before the
Meeting or any adjournments thereof.
November __, 2001
By Order of the Board of Trustees,
Eric M. Banhazl
Secretary
Investec Funds
1055 Washington Blvd., 3rd Floor
Stamford, Connecticut 06901
Dear Shareholder,
Enclosed is a Proxy Statement seeking your approval of a proposed
merger of Investec Asia New Economy ("Asia New Economy Fund") into Investec Asia
Small Cap Fund ("Asia Small Cap Fund"). Investec Asset Management U.S. Limited
("Investec") is the investment adviser for the Investec Funds and will remain
the investment adviser of the Asia Small Cap Fund after the merger.
We are recommending the merger of the two funds because the
investment objectives of the Asia New Economy Fund and the Asia Small Cap Fund
are similar and the two funds employ similar investment policies to achieve
their investment objectives. Additionally, as discussed in the accompanying
document, Asia New Economy Fund's asset base is decreasing and Asia Small Cap
Fund's ratio of expenses to net assets is lower than that of the Asia New
Economy Fund. The combined assets of the two Funds should provide a more stable
asset base for management because daily purchases and redemptions of shares
should have a less significant impact on the size of the combined Funds. The
accompanying document describes the proposed transaction and compares the
investment policies, operating expenses and performance history of the Asia
Small Cap Fund and the Asia New Economy Fund. You should review the accompanying
materials carefully.
Remember, your vote is important. PLEASE TAKE A MOMENT NOW TO SIGN,
DATE AND RETURN YOUR PROXY CARD IN THE ENCLOSED POSTAGE-PAID RETURN ENVELOPE. If
we do not receive your signed proxy card after a reasonable amount of time, you
may receive a telephone call from our proxy solicitor, Georgeson Shareholder
Communications Inc. ("GS"), reminding you to vote your shares. Proxies may be
voted by telephone by called GS at 888-889-2580 between the hours of 9:00 a.m.
and 11 p.m. (EST) Monday-Friday or Saturday between the hours of 12:00 p.m. and
6:00 p.m. (EST). If you prefer, you can fax the proxy card to GS, Attn: Proxy
Department, at 800-733-1885. We encourage you to vote by telephone or through
the Internet (please refer to your proxy card for the appropriate website) in
order to expedite the process. Whichever voting method you choose, please read
the full text of the Proxy Statement before you vote.
If you have any questions regarding the shareholder meeting, please
feel free to call our proxy solicitors, GS, at 888-889-2580 who will be pleased
to assist you.
IT IS VERY IMPORTANT THAT YOUR VOTING INSTRUCTIONS BE RECEIVED PROMPTLY.
Sincerely,
Royce N. Brennan
President
PRELIMINARY PROXY MATERIALS FOR THE INFORMATION
OF THE SECURITIES AND EXCHANGE COMMISSION
YOUR VOTE IS IMPORTANT!
------------------------------------------------------------------------------
YOU CAN VOTE EASILY AND QUICKLY BY MAIL, BY PHONE (Toll-Free), OR BY FAX.
JUST FOLLOW THE SIMPLE INSTRUCTIONS THAT APPEAR ON YOUR ENCLOSED PROXY CARD.
------------------------------------------------------------------------------
INVESTEC FUNDS
Investec Asia New Economy Fund
SPECIAL MEETING OF SHAREHOLDERS
December 27, 2001
____________________________________________________________
INVESTEC FUNDS
1055 Washington Blvd., 3rd Floor
Stamford, Connecticut 06901
COMBINED PROXY STATEMENT AND PROSPECTUS
DATED NOVEMBER __, 2001
INTRODUCTION
------------
This Combined Proxy Statement and Prospectus is being provided for a
special meeting of shareholders of the Investec Asia New Economy Fund (the
"Fund") to be held on December 27, 2001 (the "Meeting"). We have divided the
Combined Proxy Statement and Prospectus into five parts:
Part 1 -- An Overview
Part 2 -- Proposal to Reorganize the Fund
Part 3 -- More on Proxy Voting and Meeting of Shareholders
Part 4 -- Fund Information
Part 5 -- Form of Agreement and Plan of Reorganization and Liquidation
Please read the entire Proxy Statement before voting. If you have any
questions about the Meeting, please feel free to call Georgeson Shareholder
Communications Inc. at 1-888-889-2580.
This Combined Proxy Statement and Prospectus was first mailed to
shareholders the week of November 26, 2001. It contains information about
certain of the Investec Funds that you should know. Please keep it for future
reference. A Statement of Additional Information and a Prospectus dated April
26, 2001, and an Annual Report and Semi Annual Report dated
December 31, 2000 and June 30, 2001, respectively, are incorporated by reference
and can be obtained free of charge by calling us at 800-915-6565.
NEITHER THE SECURITIES AND EXCHANGE COMMISSION (THE "SEC") NOR ANY STATE
SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED THESE SECURITIES, OR
DETERMINED THAT THIS COMBINED PROXY STATEMENT AND PROSPECTUS IS ACCURATE OR
COMPLETE. ANYONE WHO TELLS YOU OTHERWISE IS COMMITTING A CRIME.
Investec Funds is required by federal law to file reports, proxy
statements and other information with the SEC. The SEC maintains a website
that contains information about the Investec Funds. Any such reports, proxy
material and other information can be inspected and copied at the public
reference facilities of the SEC, 450 Fifth Street, N.W., Washington, D.C.
20549. Copies of such materials can be obtained from the Public Reference
Branch, Office of Consumer Affairs and Information Services of the SEC at 450
Fifth Street, N.W., Washington, D.C. 20549, or by electronic request at the
following e-mail address: publicinfo@sec.gov, at prescribed rates. You may
call the SEC at (202) 942-8090 for information on the operation of the Public
Reference Room.
PART 1 - AN OVERVIEW........................................................1
PART 2 - PROPOSAL TO REORGANIZATION THE FUND................................1
Introduction...........................................................1
How the Reorganization Works...........................................1
How the Fees of the Investec Asia New Economy Fund Compare
to the Fees of the Investec Asia Small Cap Fund..................2
Information about the Reorganization...................................4
Why We Want to Reorganize the Investec Asia New Economy Fund..........15
Considerations by the Board of Trustees...............................15
How your Fund compares to the Investec Asia Small Cap Fund.............4
Comparison of Investment Objectives..............................4
Comparison of Principal Investment Risks.........................7
Comparison of Potential Risks and Rewards/Performance............8
Comparison of Operations.........................................9
Investment Advisory Agreement..........................................9
Administration Agreement, Distribution Agreement and
Distribution Plans..............................................10
Transfer Agent and Custodian..........................................10
Dividends and Other Distributions.....................................10
Purchase, Redemption and Exchange Procedures..........................11
Exchange and Redemption Rights........................................11
Trustees..............................................................11
Comparison of Shareholder Rights......................................11
Capitalization of the Funds...........................................12
Required Vote.........................................................12
Board Recommendation..................................................16
PART 3 - MORE ON PROXY VOTING AND MEETING OF SHAREHOLDERS..................16
PART 4 - FUND INFORMATION..................................................18
PART 5 - FORM OF AGREEMENT AND PLAN OF REORGANIZATION AND LIQUIDATION......19
PART 1 - AN OVERVIEW
The Board of Trustees of the Investec Funds (the "Trust") has sent you
this Combined Proxy Statement and Prospectus to ask for your vote on a proposal
to reorganize your Fund into the Investec Asia Small Cap Fund. Your Fund has
scheduled a shareholder meeting for December 27, 2001 to consider the proposal.
PART 2 - PROPOSAL TO REORGANIZE THE FUND
Introduction
The Board of Trustees of the Trust, on behalf of your Fund and the
Investec Asia Small Cap Fund, both of which are series of the Trust, has
approved an Agreement and Plan of Reorganization and Liquidation under which
your Fund would be reorganized into the Investec Asia Small Cap Fund. In this
Combined Proxy Statement and Prospectus, we refer to the Agreement and Plan of
Reorganization and Liquidation as the "Plan of Reorganization," and to the
transactions described in the Plan of Reorganization as the "reorganization."
The primary purpose of the reorganization is to provide a more stable base
for management of your Fund because daily purchases and redemptions of shares
should have a less significant impact on the size of the combined fund. This may
grant a wider range of choices among permitted investments than are currently
available to your Fund whose policy is to invest at least 85% of its assets in
securities issued by new economy companies. In addition, although expenses are
expected to rise immediately after the reorganization, the larger asset base
following the reorganization may help your Fund achieve economies of scale,
thereby reducing its expenses as a percentage of net assets.
To adopt the Plan of Reorganization, we need shareholder approval.
The next few pages of this Combined Proxy Statement and Prospectus discuss
some of the details of the proposed reorganization and how it will affect your
Fund and you.
How the Reorganization Works
If you approve the proposal discussed in this Combined Proxy Statement and
Prospectus, your Fund would reorganize into the Investec Asia Small Cap Fund.
The reorganization would work as follows:
o If you approve the Plan of Reorganization, your Fund would transfer
substantially all of its assets and liabilities to the Investec Asia Small
Cap Fund, in exchange for shares of the Investec Asia Small Cap Fund.
o Your Fund would distribute to you the Investec Asia Small Cap Fund shares
it receives. The dollar value of the Investec Asia Small Cap Fund shares
would be the same as the dollar value of your Fund shares.
o The reorganization is expected to qualify as a tax-free reorganization
under the Internal Revenue Code (the "Code"). If the reorganization
qualifies as such, you and your Fund will not recognize gain or loss
solely as a result of the reorganization.
o You would become a shareholder of the Investec Asia Small Cap Fund. Your
Fund would then cease operations.
Your Fund and the Investec Asia Small Cap Fund have the same team of
portfolio managers. The investment objective of your Fund is long-term capital
appreciation. At present, the Asia Small Cap Fund invests primarily in equity
securities of smaller capitalization issuers (market value of less than U.S. $1
billion). To enable the Asia Small Cap Fund to place a greater emphasis on
investments in equity securities of companies of any size market value which are
traded on the Asian markets or that derive a substantial portion of their
revenue from business activities in Asia but which are traded elsewhere, the
Board of Trustees of the Trust approved and voted to recommend that shareholders
of the Asia Small Cap Fund approve a change in the Funds investment objective.
Subject to approval of the proposed change of investment objective, the Asia
Small Cap Fund's name will be changed to "Investec Asia Focus Fund". It is
anticipated that before year end, shareholders of the Asia Small Cap Fund will
receive a proxy statement requesting their vote on the proposed amendment to its
investment objective. See "How Your Fund Compares to the Investec Asia Small Cap
Fund" for summary comparisons charts showing investment objectives, investment
policies and investment strategies of the Investec Asia New Economy Fund, the
Investec Asia Small Cap Fund and, assuming shareholders of the Asia Small Cap
Fund approve an amendment to its investment objective, the Investec Asia Focus
Fund. Investec Asset Management U.S. Limited (the "Adviser") currently serves as
the investment adviser of each Fund.
How the Fees of the Investec Asia New Economy Fund Compare to the
Fees of the Investec Asia Small Cap Fund
Both your Fund and the Investec Asia Small Cap Fund, like all mutual
funds, incur certain expenses in their operations. These expenses include
management fees, as well as the costs of maintaining accounts, administration,
providing shareholder liaison and distribution services, and other activities.
The following table describes the fees and expenses you may pay if you invest in
your Fund or the Investec Asia Small Cap Fund. The table also shows the expected
expenses of the Investec Asia Small Cap Fund after the reorganization. The
Funds' annual expenses may be more or less than the amounts shown below.
2
Investec Investec
Asia New Asia
Economy Small Cap Combined
Fund Fund Pro Forma
Shareholder Transaction
Expenses (paid directly from
your investment)
Maximum Sales Charge Imposed
on Purchases (as a percentage
of offering price) None None None
Sales Charge Imposed on
Reinvested Dividends None None None
Deferred Sales Charge None None None
Redemption Fees/Exchange Fees(1) 1.00% 1.00% 1.00%
Maximum Account Fee None None None
Annual Fund Operating Expenses
(as a percentage of average
daily net assets)
Management Fees 1.00% 1.00% 1.00%
Distribution (Rule 12b-1) Fees 0.00% 0.00% 0.00%
Other Expenses 2.50% 1.67% 1.68%
Total Annual Fund Operating
Expenses2 3.50% 2.67% 2.68%
Expenses Reimbursed to the Fund 1.52% 0.69% 0.70%
Net Annual Fund Operating
Expenses (expenses actually
incurred by the Fund)(2) 1.98% 1.98% 1.98%
(1) You will be charged a 1% fee if you redeem or exchange shares of either Fund
within 30 days of purchase. There is a $10 fee for redemptions by wire.
(2) The Fund's Adviser is contractually obligated to cap each Fund's Total
Annual Fund Operating Expenses at 1.98% at least through June 30, 2002.
Example. This Example is intended to help you compare the cost of
investing in the Investec Asia New Economy Fund with the cost of investing in
the Investec Asia Small Cap Fund.
The Example assumes that you invest $10,000 in either of the Funds for the
time periods indicated and then redeem all of your shares at the end of those
periods. The Example also assumes that your investment has a 5% return each year
and that each Fund's operating expenses remain the same. Although your actual
costs may be higher or lower, based on these assumptions your costs would be:
3
- --------------------------------------------------------------------------------
1 Year 3 Years 5 Years 10 Years
- --------------------------------------------------------------------------------
Investec Asia New Economy Fund* $201 $933 $1,687 $3,674
- --------------------------------------------------------------------------------
Investec Asia Small Cap Fund* $201 $764 $1,354 $2,952
- --------------------------------------------------------------------------------
Combined Pro Forma* $201 $766 $1,358 $2,961
- --------------------------------------------------------------------------------
* Your costs of investing in the Fund for 1 year reflect the amount you
would pay after the Adviser reimburses the Fund for some or all of the
other expenses. Your costs of investing in the Fund for 3, 5 and 10
years reflect the amount you would pay if the Adviser did not reimburse
the Fund for some or all of the other expenses. If the Adviser
continues to cap the Fund's expenses for 3, 5 or 10 years as the
Advisor did for the first year, your actual costs for those periods
would be lower than the amounts shown. The Advisor is currently under
no obligation to cap expenses for any period beyond June 30, 2002.
How your Fund Compares to the Investec Asia Small Cap Fund.
For complete information about your Fund, or the Investec Asia Small Cap
Fund, please refer to your copy of the Investec Funds' combined prospectus dated
April 26, 2001. You also can call us at 800-915-6565 for a free copy of the
combined prospectus. The information contained in your Fund's prospectus is
incorporated by reference into this Combined Proxy Statement and Prospectus.
Comparison of Investment Objectives. The following table compares
the investment objective of your Fund with the current investment objective of
the Investec Asia Small Cap Fund, and with the investment objective of the
Investec Asia Focus Fund, assuming that shareholders of the Asia Small Cap Fund
vote to approve a proposed change of fundamental investment objective.
- --------------------------------------------------------------------------------
Investec Asia Small Cap
Fund Pro Forma:
Assuming change of name
to Investec Asia Focus
Investec Asia New Economy Investec Asia Small Cap Fund and change of
Fund Fund: Current investment objective
- --------------------------------------------------------------------------------
Long-term capital Long-term capital Long-term capital
appreciation. appreciation primarily appreciation
through investments in
equity securities of
smaller capitalization
issuers that are located
in Asia.
- --------------------------------------------------------------------------------
Comparison of Investment Policies and Strategies. Your Fund and the
Investec Asia Small Cap Fund differ primarily in the investment strategies that
they employ to achieve their respective goals. For example, your Fund limits its
investments to securities issued by "new economy" companies that are traded
primarily on the Asian stock markets, whereas the Investec Asia Small Cap Fund
invests primarily in securities issued by "small cap" companies that are traded
on the Asian markets. Furthermore, assuming that the change of investment
objective is approved by shareholders of the Investec Asia Small Cap Fund, the
investments of the renamed fund (Investec Asia Focus Fund) will not be limited
to "new economy" or "small
4
cap" companies. Rather, the Investec Asia Focus Fund will invest at least 65% of
its assets in equity securities of Asian companies of all types. The following
table highlights in more detail the differences between the principal investment
policies and strategies of your Fund with the current principal investment
policies and strategies of the Investec Asia Small Cap Fund, and the proposed
principal investment policies and strategies of the Investec Asia Focus Fund.
- -------------------------------------------------------------------------------
Investec Asia Small Cap
Fund Pro Forma: Assuming
change of name to Investec
Investec Asia New Investec Asia Small Cap Asia Focus Fund and change
Economy Fund Fund: Current of investment objective
- -------------------------------------------------------------------------------
The Fund intends to The Investec Asia Small Cap The Investec Asia Focus
invest at least 85% Fund intends to invest at Fund intends to invest at
of its total assets least 65% of its total least 65% of its total
in securities assets in securities issued assets in equities of
issued by New by "small cap" companies Asian companies. The
Economy companies that are traded on the Asian Fund considers an issuer
that are traded markets. of securities to be an
primarily on the Asian Company if: (i) it
Asian stock markets. A small cap company for is organized under the
purposes of this Fund is a laws of a country in Asia
The New Economy company that has a market and has a principal
consists of those value of less than U.S. $1 office in a country in
companies that use billion. Asia (ii) it derives a
communications significant portion
technology to Under normal market (i.e., 50% or more) of
create global conditions, the Investec its total revenues from
competition. Asia Small Cap Fund will business in Asia; or
invest in at least four (iii) its equity
Under normal market different countries. These securities are traded
conditions, the countries include, but are principally on a stock
Fund will invest in not limited to: exchange in Asia or in an
at least four over-the-counter market
different o Mainland China, Hong in Asia.
countries. These Kong, Taiwan and South Korea
countries include, in Northeast Asia; Under normal market
but are not limited conditions, the Investec
to: o Singapore, Thailand, Asia Focus Fund will
Malaysia, Indonesia, Vietnam invest in at least four
o Mainland and the Philippines in different countries.
China, Hong Southeast Asia; and These countries include,
Kong, Taiwan but are not limited to:
and South o India, Pakistan,
Korea in Bangladesh and Sri Lanka in o Mainland China, Hong
Northeast Asia; South Asia. Kong, Taiwan and
South Korea in
o Singapore, When current market, Northeast Asia;
Thailand, economic, political or other
Malaysia, conditions are unsuitable o Singapore, Thailand,
Indonesia, for the Investec Asia Small Malaysia, Indonesia,
Vietnam and Cap Fund's investment Vietnam and the
the objective, the Investec Asia Philippines in
Philippines in Small Cap Fund may Southeast Asia; and
Southeast temporarily invest up to
Asia; and 100% of its assets in cash, o India, Pakistan,
cash equivalents or high Bangladesh,
5
- -------------------------------------------------------------------------------
Investec Asia Small Cap
Fund Pro Forma: Assuming
change of name to Investec
Investec Asia New Investec Asia Small Cap Asia Focus Fund and change
Economy Fund Fund: Current of investment objective
- -------------------------------------------------------------------------------
o India, quality short-term money Sri Lanka, New
Pakistan, market instruments. However, Zealand in South Asia.
Bangladesh and the Fund will not engage in
Sri Lanka in market timing. The Under normal market
South Asia. philosophy of the Fund is to conditions, the Fund
remain invested. intends to invest in
Under normal market approximately 35 to 40
conditions, the stocks. The Fund manager
Fund intends to will invest primarily in
invest in medium to large market
approximately 35 to capitalization companies
40 stocks. The Fund (companies with market
manager will invest capitalizations greater
primarily in medium than $1 billion).
to large market
capitalization When current market,
companies economic, political or
(companies with other conditions are
market unsuitable for the
capitalizations Investec Asia Focus Fund's
greater than $1 investment objective, the
billion) but may Investec Asia Focus Fund
from time to time may temporarily invest up
invest in smaller to 100% of its assets in
capitalization cash, cash equivalents or
issues (companies high quality short-term
with market money market instruments.
capitalization less However, the Fund will not
than $1 billion). engage in market timing.
The philosophy of the Fund
When current is to remain invested.
6
- -------------------------------------------------------------------------------
Investec Asia Small Cap
Fund Pro Forma: Assuming
change of name to Investec
Investec Asia New Investec Asia Small Cap Asia Focus Fund and change
Economy Fund Fund: Current of investment objective
- -------------------------------------------------------------------------------
market, economic,
political or other
conditions are
unsuitable for the
Fund's investment
objective, the Fund
may temporarily
invest up to 100%
of its assets in
cash, cash
equivalents or high
quality short-term
money market
instruments. To the
extent that the
Fund is invested in
cash, cash
equivalents or high
quality short-term
money market
instruments for
defensive purposes,
the Fund's
investment
objective may not
be achieved. When
investing for
temporary defensive
purposes, the Fund
will not engage in
market timing. The
philosophy of the
Fund is to remain
invested.
- -------------------------------------------------------------------------------
Comparison of Principal Investment Risks. The Funds are all subject
to the risks common to all mutual funds that invest in equity securities.
However, each Fund's risks differ based on the types of equity securities in
which it invests. The following table highlights in more detail the differences
between the principal investment risks of investing in your Fund, the principal
investment risks of investing in the Investec Asia Small Cap Fund, and the
principal investment risks of investing in the Investec Asia Focus Fund,
assuming the shareholders of the Asia Small Cap Fund approve a proposed change
of fundamental investment objective.
- --------------------------------------------------------------------------------
Investec Asia Small Cap
Fund Pro Forma: Assuming
change of name to
Investec Asia Focus Fund
Investec Asia New Economy Investec Asia Small Cap and change of investment
Fund Fund objective
- --------------------------------------------------------------------------------
You may lose money if any You may lose money by You may lose money if any
of the following occurs: investing in this Fund of the following
if any of the following occurs:
7
- --------------------------------------------------------------------------------
Investec Asia Small Cap
Fund Pro Forma: Assuming
change of name to
Investec Asia Focus Fund
Investec Asia New Economy Investec Asia Small Cap and change of investment
Fund Fund objective
- --------------------------------------------------------------------------------
o the Asian stock occur:
markets decline in o the Asian stock
value; o the Asian stock markets decline in
markets decline in value;
o Asian New Economy value,
stocks fall out of o a stock or stocks in
favor with investors; o Asian small cap the Fund's portfolio
stocks fall out of do not perform well;
o the value of Asian favor with
currencies declines investors; o the value of Asian
relative to the U.S. currencies declines
dollar; o small cap stocks relative to the U.S.
are more difficult dollar;
o a foreign government to sell during a
expropriates the down market due to o a foreign government
Fund's assets; lower liquidity; expropriates the
Fund's assets; or
o political, social or o a stock or stocks
economic instability in the Fund's o political, social or
in Asia causes the portfolio do not economic instability
value of the Fund's perform well; in Asia causes the
investments to value of the Fund's
decline; or o the value of Asian investments to
currencies declines decline.
o the Fund manager's relative to the
investment strategy U.S. dollar;
does not achieve the
Fund's objective or o a foreign
the manager does not government
implement the expropriates the
strategy properly. Fund's assets; or
o political, social
or economic
instability in Asia
causes the value of
the Fund's
investments to
decline.
- --------------------------------------------------------------------------------
Comparison of Potential Risks and Rewards/Performance. Both Funds
have their own risks and potential rewards. The charts and tables below compare
the potential risks and rewards of investing in each Fund.
The bar charts shown below provide an indication of the risks of investing
in each Fund by showing changes in each Fund's performance for various time
periods ending December 31. The figures shown in the bar charts and tables
assume reinvestment of dividends.
8
Keep in mind that past performance does not indicate future results.
Investec Asia New Economy Fund*
2000: -38.58%
1999: 61.16%
1998: -11.78%
1997: -37.68%
* Formerly known as the Guinness Flight Asia Blue Chip Fund.
During the period shown in the bar chart, the highest return for a quarter
was 35.67% (quarter ending December 31, 1999) and the lowest return for a
quarter was -26.75% (quarter ending June 30, 1998).
Investec Asia Small Cap Fund
2000: -45.74%
1999: 42.43%
1998: -30.83%
1997: -30.77%
During the period shown in the bar chart, the highest return for a quarter
was 40.59% (quarter ending June 30, 1999) and the lowest return for a quarter
was -37.39% (quarter ending December 31, 1997).
The average annual total returns for the two Funds for the periods ended
December 31, 2000 are as follows:
- ----------------------------------------------------------------------
Past One Since
Average Annual Total Returns Year inception
- ----------------------------------------------------------------------
Investec Asia New Economy Fund -38.58% -11.49%*
- ----------------------------------------------------------------------
Investec Asia Small Cap Fund -45.74% -16.99%*
- ----------------------------------------------------------------------
*Average annual total return since inception, April 29, 1996.
Comparison of Operations.
Investment Advisory Agreement
Investec Asset Management U.S. Limited (the "Adviser") is the investment
adviser for both of the Funds. The Adviser supervises all aspects of each Fund's
operations and advises the Funds, subject to oversight by the Funds' Board of
Trustees. For providing these services, each Fund pays the Adviser an annual 1%
advisory fee. The Adviser's primary offices are located in the U.K., South
Africa, Guernsey, Hong Kong, and the U.S. The U.S. office is located at 1055
9
Washington Blvd., 3rd Floor Stamford, CT 06901. The Advisers' main office is
located in London, England at 2 Gresham Street, London EC2V 7QP. The Hong Kong
office is located at 2106-2108 Jardine House, One Connaught Place, Central, Hong
Kong. The current Advisory Agreement was approved on behalf of each Fund by the
Board of Trustees on June 3, 1998 and by the shareholders of the Funds on August
25, 1998 at a shareholder meeting called for that purpose.
Administration Agreement, Distribution Agreement and Distribution
Plan
The Trust has entered into separate Administration and Distribution
Agreements with respect to the Funds with Investment Company Administration,
L.L.C. ("Administrator") and Quasar Distributors, LLC ("Distributor"),
respectively.
For its services to the Funds, the Administrator receives a monthly fee
equal to, on an annual basis, 0.25% of each Funds' average daily net assets,
subject to a $40,000 annual minimum for the Investec Asia New Economy Fund and
for the Investec Asia Small Cap Fund.
Under the Distribution Agreement, the Distributor uses all reasonable
efforts, consistent with its other business, to secure purchases for the Funds'
shares and pays the expenses of printing and distributing any prospectuses,
reports and other literature used by the Distributor, advertising, and other
promotional activities in connection with the offering of shares of the Funds
for sale to the public. It is understood that the Administrator may reimburse
the Distributor for these expenses from any source available to it, including
the administration fee paid to the Administrator by the Funds.
The Funds will not make separate payments as a result of the Distribution
Plan to the Adviser, the Administrator, Distributor or any other party, it being
recognized that the Funds presently pay, and will continue to pay, an investment
advisory fee to the Adviser and an administration fee to the Administrator. To
the extent that any payments made by the Funds to the Adviser or the
Administrator, including payment of fees under the Investment Advisory Agreement
or the Administration Agreement, respectively, should be deemed to be indirect
financing of any activity primarily intended to result in the sale of shares of
the Funds within the context of rule 12b-1 under the Investment Company Act of
1940, as amended (the "1940 Act"), then such payments shall be deemed to be
authorized by the Plan. The Distribution Plan and related agreements were
approved by the Board of Trustees including all of the "Qualified Trustees"
(Trustees who are not "interested" persons of the Funds, as defined in the 1940
Act, and who have no direct or indirect financial interest in the Plan or any
related agreement).
Transfer Agent and Custodian
Transfer Agent. State Street Bank and Trust Company is the Transfer Agent
for the Funds. The Transfer Agent provides record keeping and shareholder
services. State Street is located at P.O. Box 1912, Boston, MA 02105.
Custodian. Investors Bank and Trust Company is the custodian for the
Funds. The custodian holds the securities, cash and other assets of the Funds.
Investors Bank and Trust is located at 200 Claredon Street, Boston, MA 02116.
10
Dividends and Other Distributions
The dividend and distribution arrangements for both your Fund and the
Investec Asia Small Cap Fund are the same. Both Funds distribute all or most of
their net investment income and net capital gains to shareholders. Dividends
(investment income) for the Funds are normally declared and paid semi-annually,
in June and December. Net capital gains for the Funds are normally distributed
in June and December. When calculating the amount of capital gain for a Fund,
the Fund can offset any capital gain with net capital loss (which may be carried
forward from a previous year).
Your dividends and/or capital gains distributions will be automatically
reinvested on the ex-dividend date when there is a distribution, unless you
elect otherwise, so that you will be buying more of both full and fractional
shares of the Fund. You will be buying those new shares at the NAV per share on
the ex-dividend date. You may choose to have dividends and capital gains
distributions paid to you in cash. You may also choose to reinvest dividends and
capital gains distributions in shares of another Investec Fund. You may
authorize either of these options by calling the Transfer Agent at (800)
915-6565 and requesting an optional shareholder services form. Dividends and
distributions are treated in the same manner for federal income tax purposes
whether you receive them in the form of cash or additional shares.
Purchase, Redemption and Exchange Procedures
The purchase, redemption and exchange procedures for both your Fund and
the Investec Asia Small Cap Fund are the same. The Transfer Agent is open from 8
a.m. to 6 p.m. Eastern Time for purchase, redemption and exchange orders. Shares
will be purchased, exchanged and redeemed at NAV per share. For trades in the
Investec Asia New Economy Fund and the Investec Asia Small Cap Fund the cut-off
time is 9:30 a.m. Eastern Time, meaning that purchase, exchange and redemption
orders must be received by that time to be processed that day. The phone number
you should call for account transaction requests is (800) 915-6565.
Exchange and Redemption Rights
The exchange and redemption rights for both your Fund and the Investec
Asia Small Cap Fund are the same. You may exchange or redeem shares by mail or
telephone. When you exchange shares, you sell shares of one Investec Fund and
buy shares of another Fund. You may realize either a gain or loss on those
shares and will be responsible for paying the appropriate taxes. If you exchange
or redeem through a broker, the broker may charge you a transaction fee. If you
purchased your shares by check, you may not receive your redemption proceeds
until the check has cleared, which may take up to 15 calendar days.
Trustees
The Board of Trustees of the Trust is responsible for the management of
both Funds.
Comparison of Shareholder Rights. As series of the Trust, both
Funds' shareholders have the same rights, including, but not limited to, par
value, preemptive rights, preference and appraisal rights.
11
Capitalization of the Funds. The table below show existing
capitalization as of September 30, 2001, as well as pro forma capitalization as
of the same date, which reflects the impact of any corporate actions, including
accounting adjustments, required to facilitate the reorganization. For these
reasons, the total pro forma combined Total Net Assets may differ from the
combined net assets of the Funds prior to the reorganization.
------------------------------------------------------------------------------
Shares
Total Net Outstanding
Assets (000) (000) NAV
------------------------------------------------------------------------------
Investec Asia New Economy Fund $2,959 628 $4.71
------------------------------------------------------------------------------
Investec Asia Small Cap Fund $11,007 2,442 $4.51
------------------------------------------------------------------------------
Combined Pro Forma $9,281 2,058 $4.51
------------------------------------------------------------------------------
Information about the Reorganization
This section describes some information you should know about the
reorganization.
Description of transaction. The Plan of Reorganization provides that your
Fund will transfer substantially all of its assets to the Investec Asia Small
Cap Fund in exchange for shares of the Investec Asia Small Cap Fund in the same
proportion as the shares of your Fund. The Investec Asia Small Cap Fund will
also assume substantially all of your Fund's liabilities. After this
transaction, the Investec Asia New Economy Fund will give you shares of the
Investec Asia Small Cap Fund (the "Closing"). The dollar value of the shares you
receive will be equal to the dollar value of the Fund shares you owned at the
end of business on the day of the Closing. You will not pay a sales charge or
any other fee as part of this transaction.
Please see the Plan of Reorganization for a more detailed description of
the reorganization. You can find the Plan of Reorganization in Part 5 of this
Combined Proxy Statement and Prospectus.
Tax Consequences of the Reorganization. The following discussion addresses
certain material United States federal income tax consequences of the
reorganization. It is based on current tax law, which may be changed by
legislative, judicial, or administrative action, possibly with retroactive
effect. No attempt has been made to present a complete discussion of the federal
tax consequences to the Funds or their shareholders, and this discussion does
not address any state, local or foreign tax consequences. The discussion relates
to United States persons who hold shares of your Fund as capital assets (as
defined in section 1221 of the Code). Special tax considerations may apply to
certain types of investors subject to special treatment under the tax law.
Accordingly, you are urged to consult your tax adviser with specific reference
to your own tax circumstances.
As a condition to the closing of the reorganization, both your Fund and
the Asia Small Cap Fund must receive an opinion of counsel, on the basis of the
representations set forth or referred to in such opinion, describing the
material federal income tax consequences of the reorganization (the "Tax
Opinion"). The Funds anticipate that the Tax Opinion will provide that, although
the federal income tax consequences of the reorganization are not free from
doubt, the reorganization should constitute a "reorganization" as such term is
defined in section 368(a)(1)
12
of the Code (a "tax-free reorganization"). If the reorganization qualifies as a
tax-free reorganization, then:
o No gain or loss should be recognized by your Fund on the transfer to
the Asia Small Cap Fund of its assets in exchange solely for shares
of the Asia Small Cap Fund and the Asia Small Cap Fund's assumption
of your Fund's liabilities or on the subsequent distribution of
shares of the Asia Small Cap Fund to you in liquidation of your
Fund;
o No gain or loss should be recognized by the Asia Small Cap Fund on
its receipt of your Fund's assets in exchange solely for shares of
the Asia Small Cap Fund and the Asia Small Cap Fund's assumption of
your Fund's liabilities;
o The Asia Small Cap Fund's adjusted tax basis in the assets acquired
from your Fund should be equal to the basis thereof in your Fund's
hands immediately before the reorganization, and the Asia Small Cap
Fund's holding period for the assets acquired from your Fund will
include your Fund's holding period therefor;
o You should recognize no gain or loss on the exchange of shares of
your Fund solely for shares of the Asia Small Cap Fund pursuant to
the reorganization; and
o Your aggregate tax basis in shares of the Asia Small Cap Fund
received by you in the reorganization should equal your aggregate
tax basis in the shares of your Fund surrendered in exchange
therefor, and your holding period for shares of the Asia Small Cap
Fund received in the reorganization should include your holding
period for the shares of your Fund surrendered in exchange therefor,
provided that you hold such shares as capital assets at the
effective time of the reorganization.
However, it is possible that the Internal Revenue Service could
successfully challenge the qualification of the reorganization as a tax-free
reorganization. If the reorganization does not qualify as a tax-free
reorganization:
o Your Fund would be treated as if it had transferred all of its
assets to the Asia Small Cap Fund in a taxable transaction in which
all built-in gains and losses on the assets transferred would be
recognized;
o You would be deemed to have exchanged your shares of your Fund for
shares of the Asia Small Cap Fund in a taxable transaction in which
you would recognize a capital gain or loss equal to the difference
between your adjusted tax basis in the shares surrendered and the
fair market value of the shares of the Asia Small Cap Fund received;
and
o Your aggregate tax basis in shares of the Asia Small Cap Fund
received by you in the reorganization would be equal to their fair
market value on the date of the reorganization, and your holding
period for shares of the Asia Small Cap Fund received by you in the
reorganization would begin on the day after the day you receive such
shares.
13
In the event that the reorganization fails to qualify as a
tax-free reorganization, the Adviser believes that your Fund's capital loss
carryforwards would be sufficient to offset any net gain that would be
recognized by your Fund.
As of September 30, 2001, your Fund had capital loss
carryforwards of $2,537,351. If the reorganization qualifies as a tax-free
reorganization, the use of your Fund's capital loss carryforwards after the
reorganization will be limited each year to an amount equal to the net asset
value of your Fund immediately prior to the reorganization multiplied by the
long-term tax-exempt rate in effect for the month in which the reorganization
occurs (the rate for November 2001 is 4.85%). If the reorganization does not
qualify as a tax-free reorganization, your Fund's capital loss carryforwards
will not be available to offset capital gains of the Asia Small Cap Fund
after the reorganization. Regardless of any limitation on the ability of the
Asia Small Cap Fund to utilize your Fund's losses, the Asia Small Cap Fund
had $89,932,816 of its own capital loss carryforwards as of September 30,
2001 that are available to offset capital gains realized after the
reorganization.
Assuming the reorganization qualifies as a tax-free
reorganization, you will be required to retain in your records and file with
your federal income tax return for the taxable year in which the
reorganization takes place a statement setting forth all relevant facts in
respect of the nonrecognition of gain or loss upon the exchange. The
statement is required to include:
o your tax basis in the shares surrendered in the
reorganization; and
o the fair market value of the shares of the Asia Small Cap Fund
received in the reorganization as of the effective time of the
reorganization.
Your Fund may pay a dividend or distribute a taxable gain prior
to the reorganization. You may be liable for taxes on those distributions.
The foregoing discussion is intended only as a summary and does
not purport to be a complete analysis or listing of all potential tax effects
relevant to a decision whether to vote in favor of the reorganization.
Conditions of the reorganization. Before the reorganization can occur,
both your Fund and the Investec Asia Small Cap Fund must satisfy certain
conditions. For example:
o Each Fund must receive an opinion of counsel stating, in effect, that the
reorganization will qualify as a tax-free reorganization under the Code;
o Each Fund must receive an opinion of counsel describing the material
federal income tax consequences of the reorganization.
o A majority of the shareholders voting at the Meeting in person or by proxy
must approve the reorganization.
14
Why We Want to Reorganize the Investec Asia New Economy Fund
The Adviser believes that the reorganization will benefit both of the
Funds. Among other things, the Adviser believes the reorganization will:
o Result in economies of scale. That is, the increased assets of two
combined Funds could possibly reduce expenses over time by spreading fixed
costs over a larger asset base.
o Going forward, eliminate duplicative efforts that separate funds may
require, such as accounting services, resulting in more efficient
operations of the Investec Asia Small Cap Fund.
o Provides a more stable base for management of your Fund because daily
purchases and redemptions of shares should have a less significant impact
on the size of the two combined Funds.
o Provide greater investment opportunities. That is, the increased assets of
the two combined Funds will provide the manager with a wider range of
choices among permitted investments than are currently available to the
Funds separately.
Considerations by the Board of Trustees
On September 10, 2001, the Board of Trustees of the Trust, on behalf of
both your Fund and the Investec Asia Small Cap Fund, unanimously approved the
proposed Plan of Reorganization. The Trustees concluded that the reorganization:
o Was in the best interests of the shareholders of both your Fund and the
Investec Asia Small Cap Fund; and
o Would not result in any dilution of the value of your investment or the
investment of the shareholders of the Investec Asia Small Cap Fund.
In approving the Plan of Reorganization, the Trustees, including a
majority of the Trustees who are not "interested persons" (as defined in the
Investment Company Act of 1940, as amended) (the "Independent Trustees"),
considered that, among other things:
o The investment objective and policies of your Fund and those proposed for
the Investec Asia Small Cap Fund are relatively similar (see comparison
charts below); and
o Merging your Fund with the Investec Asia Small Cap Fund would result in
the combined Fund having a larger asset base which, over time, may result
in economies of scale and offer improved services to shareholders.
Required Vote
Approval of the Proposal requires approval of a majority of the
outstanding shares of your Fund. Should the Plan of Reorganization not be
approved, the Board of Trustees would
15
determine what, if any, further action should be taken, including continuing to
operate your Fund or liquidating it.
Board Recommendation
THE BOARD OF TRUSTEES RECOMMENDS THAT
SHAREHOLDERS VOTE "FOR" THE PROPOSAL
PART 3 - MORE ON PROXY VOTING AND MEETING of SHAREHOLDERS
Who Can Vote
Only shareholders of record of the Fund at the close of business on the
Record Date, November 5, 2001, may vote for the proposal at the Meeting. As
of the Record Date, the Fund had 654,280.8 shares of beneficial interest
issued and outstanding, each share being entitled to one vote.
Information Concerning Outstanding Shares
As of the Record Date, November 5, 2001, principal holders owning 5% or
more of the outstanding shares of the Fund are set forth below:
- --------------------------------------------------------------------------------
Shareholder Name & Address % held as of November 5, 2001
-------------------------- ------------------------------
Charles Schwab & Co. Inc. 32.60%
Special Custody Account for the
Exclusive Benefit of Customers
Attn: Mutual Funds
101 Monterey Street
San Francisco, CA 94104-4122
- --------------------------------------------------------------------------------
As of the Record Date, the Trustees and officers as a group owned
beneficially less than 1% of the outstanding shares of the Fund.
Quorum Requirements
At the Meeting, the presence in person or by proxy of shareholders of
one-third of the outstanding shares entitled to vote at the Meeting shall be
necessary and sufficient to constitute a quorum for the transaction of
business. In the event that a quorum of shareholders is not present at the
Meeting, the persons named as proxies shall have the power to adjourn the
Meeting. Such meeting shall be reconvened without additional notice. In the
event a quorum is present but sufficient votes to approve the proposal are
not received, the persons named as proxies may propose one or more
adjournments to permit further solicitation of proxies. If this should
occur, we will vote proxies for or against a motion to adjourn in the same
proportion to the votes received in favor or against the proposal.
16
You may cast one vote for the proposal for each whole share that you
own of the Fund. We count your fractional shares as fractional votes. If we
receive your proxy before the Meeting date, we will vote your shares as you
instruct the proxies. If you sign and return your proxy, but do not specify
instructions, we will vote your shares in favor of the proposal. You may
revoke your proxy at any time before the Meeting if you notify us in writing,
or if you attend the Meeting in person and vote in person.
If a proxy represents a broker "non-vote" (that is, a proxy from a
broker or nominee indicating that such person has not received instructions
from the beneficial owner or other person entitled to vote shares on a
particular matter with respect to which the broker or nominee does not have
discretionary power) or is marked with an abstention, the shares represented
thereby will be considered to be present at the Meeting for purposes of
determining the existence of a quorum for the transaction of business but
will not be voted. For this reason, a broker "non-vote" and abstentions will
have the affect of a "no" vote for purposes of obtaining the requisite
approval of the proposal.
The Proxy Solicitation Process
The Board of Trustees of the Trust is soliciting your proxy to vote on
the matters described in this Combined Prospectus and Proxy Statement. We
expect to solicit proxies primarily by mail, but representatives of the Fund,
the Adviser, their affiliates or others may communicate with you by mail or
by telephone or other electronic means to discuss your vote. Such
individuals will receive no additional compensation from the Fund for
soliciting your proxy vote. The costs of preparing and mailing proxy
materials will be borne by the Adviser, and is estimated to be $2,930.
Proxy solicitations will be made primarily by mail, but may also be made by
telephone, facsimile or personal interview conducted by certain officers or
employees of the Fund or the Adviser. The Fund has also retained Georgeson
Shareholder Communications Inc. ("GS") to assist with proxy solicitations,
the cost of which (estimated to be $2,063) will also be borne by the
Adviser. GS is responsible for soliciting individual shareholders, brokers,
custodians, nominees and fiduciaries, tabulating the returned proxies and
performing other proxy solicitation services.
PLEASE TAKE A MOMENT NOW TO SIGN, DATE AND RETURN YOUR PROXY CARD IN
THE ENCLOSED POSTAGE-PAID RETURN ENVELOPE. If we do not receive your signed
proxy card after a reasonable amount of time, you may receive a telephone
call from our proxy solicitor, GS, reminding you to vote your shares.
proxies may be voted by telephone by calling GS at 888-899-2580 between the
hours of 9:00 a.m. and 11:00 p.m. (EST) Monday-Friday or Saturday between the
hours of 12:00 p.m. and 6:00 p.m. (EST) If you prefer, you can fax the proxy
card to GS, Attn: Proxy Department, at 800-733-1885. We encourage you to
vote by telephone or through the Internet (please refer to your proxy card
for the appropriate website) in order to expedite the process. Whichever
voting method you choose, please read the full text of the Proxy Statement
before you vote.
If you have any questions regarding the shareholder meeting, please
feel free to call our proxy solicitors, GS, at 888-889-2580 who will be
pleased to assist you.
17
Other business. The Board of Trustees knows of no other business to be
brought before the Meeting. If any other matters properly come before the
Meeting, and on all matters incidental to the conduct of the Meeting, the
named proxies will vote all proxies using their best judgment on such matters
unless instructed to the contrary.
Recommendation of the Board of Trustees. After carefully considering
all of the issues involved, the Board of Trustees of the Trust has
unanimously concluded that the proposal is in the best interests of
shareholders. The Board of Trustees recommends that you vote to approve the
Proposal.
PART 4 - FUND INFORMATION
The Trust is a business trust established under Delaware law. The
operations of The Trust is governed by a Trust Instrument dated March 7, 1997.
Each Fund is a separate series of the Trust and, as such, has similar
rights under the Trust Instrument of the Trust and applicable Delaware law.
You should be aware of the following features of the Funds:
o Shares of each Fund participate equally in dividends and other
distributions attributable to that Fund, including any distributions in
the event of a liquidation.
o Each share of the Funds is entitled to one vote for all purposes.
o Shares of all series of the Trust vote for the election of Trustees and on
any other matter that affects all series of the Trust in substantially the
same manner, except as otherwise required by law.
o As to matters that affect each Fund differently, such as approval of an
investment advisory agreement, shares of each series vote as a separate
series.
o Delaware law does not require registered investment companies, such as the
Trust or its series, to hold annual meetings of shareholders and it is
anticipated that shareholder meetings will be held only when specifically
required by federal or state law.
o Shareholders have available certain procedures for the removal of
Trustees.
o The Trust indemnifies trustees and officers to the fullest extent
permitted under federal and Delaware law.
Financial Statements. Ernst & Young LLP, independent auditors of the
Trust, has audited the financial statements for the year ended December 31,
2000 included in the Trust's Annual Report to Shareholders and incorporated
by reference into the Statement of Additional Information date April 26, 2001.
18
PART 5 - FORM OF AGREEMENT AND PLAN OF REORGANIZATION AND LIQUIDATION
This AGREEMENT AND PLAN OF REORGANIZATION AND LIQUIDATION ("Agreement")
is made as of _______, 2001, between Investec Funds, a Delaware business
trust (the "Trust"), on behalf of Investec Asia Small Cap Fund, a series of
the Trust ("Acquiring Fund"), and the Trust, on behalf of, Investec Asia New
Economy Fund a series of the Trust ("Target"). (Acquiring Fund and Target
are sometimes referred to herein individually as a "Fund" and collectively as
the "Funds," and the Trust is sometimes referred to herein as the "Investment
Company.")
All agreements, representations, and obligations described herein, made
or to be taken or undertaken by either Fund, are made or shall be taken or
undertaken by the Trust on the Fund's behalf.
In accordance with the terms and conditions set forth in this
Agreement, the parties desire that Target transfer substantially all its
assets to Acquiring Fund in exchange solely for voting shares of beneficial
interest of Acquiring Fund ("Acquiring Fund's Shares") and the assumption by
Acquiring Fund of substantially all of Target's liabilities, and that Target
distribute Acquiring Fund's Shares pro rata to the holders of shares of
beneficial interest in Target ("Target's Shares") in liquidation of Target.
All such transactions with respect to Target and Acquiring Fund are referred
to herein collectively as the "Reorganization."
It is intended by the parties hereto that the Reorganization constitute
a reorganization within the meaning of Section 368(a)(1) of the Internal
Revenue Code of 1986, as amended (the "Code"). The parties hereto hereby
adopt this Agreement as a "plan of reorganization" within the meaning of
Treasury Regulation Sections 1.368-2(g) and 1.368-3(a).
In consideration of the mutual promises herein, the parties covenant
and agree as follows:
1. PLAN OF REORGANIZATION AND LIQUIDATION OF TARGET
1.1. At the Effective Time (as defined in paragraph 3.1), Target agrees
to assign, sell, convey, transfer, and deliver all of its assets
described in paragraph 1.2 ("Assets") to Acquiring Fund. Acquiring
Fund agrees in exchange therefore:
(a) to issue and deliver to Target the number of full and
fractional Acquiring Fund's Shares determined by dividing the
net value of Target (computed as set forth in paragraph 2.1)
by the "NAV" (computed as set forth in paragraph 2.2) of
Acquiring Fund's Shares; and
(b) to assume Target's liabilities described in paragraph 1.3
("Liabilities").
1.2. Assets shall include, without limitation, all cash, cash
equivalents, securities, receivables (including interest and
dividends receivable), claims and rights of action, rights to
register shares under applicable securities laws, books and records,
deferred and prepaid expenses shown as assets on Target's books, and
other property owned by Target at the Effective Time as defined in
paragraph 3.1.
19
1.3. Liabilities shall include (except as otherwise provided herein) all
of Target's known liabilities, debts and obligations arising in the
ordinary course of business reflected on the books of Target at the
Effective Time, and any contingent liabilities, if any, as the Board
of Trustees shall reasonably deem exist against Target at the
Effective Time, for which contingent and other appropriate liability
reserves shall be established on Target's books. Notwithstanding
the foregoing, Target agrees to use its best efforts to discharge
all of its known Liabilities prior to the Effective Time.
1.4. At or immediately before the Effective Time, Target shall declare
and pay to its shareholders a dividend and/or other distribution in
an amount large enough so that it will have distributed
substantially all (and in any event not less than 90%) of its
investment company taxable income (computed without regard to any
deduction for dividends paid) and substantially all of its realized
net capital gain, if any, for the current taxable year through the
Effective Time.
1.5. At the Effective Time (or as soon thereafter as is reasonably
practicable), Target shall distribute Acquiring Fund's Shares
received by it pursuant to paragraph 1.1 to Target's shareholders of
record, determined as of the Effective Time (collectively
"Shareholders" and individually a "Shareholder"), in exchange for
Target's Shares and in liquidation of Target. To accomplish this
distribution, Acquiring Fund's transfer agent ("Transfer Agent")
shall open accounts on Acquiring Fund's share transfer books in the
Shareholders' names and transfer Acquiring Fund's Shares thereto.
Each Shareholder's account shall be credited with the pro rata
number of full and fractional (rounded to the third decimal place)
Acquiring Fund's Shares due that Shareholder. All outstanding
Target's Shares, including any represented by certificates, shall
simultaneously be canceled on Target's share transfer books.
Acquiring Fund shall not issue certificates representing Acquiring
Fund's Shares in connection with the Reorganization. However,
certificates representing Target's Shares shall represent Acquiring
Fund's Shares after the Reorganization.
1.6. As soon as reasonably practicable after distribution of Acquiring
Fund's Shares pursuant to paragraph 1.5, Target shall be terminated
and any further actions shall be taken in connection therewith as
required by applicable law. Target shall file such instruments and
shall take all other steps necessary to effect a complete
liquidation and dissolution of Target.
1.7. Any reporting responsibility of Target to a public authority is and
shall remain its responsibility up to and including the date on
which it is terminated.
1.8. Any transfer taxes payable upon issuance of Acquiring Fund's Shares
in a name other than that of the registered holder on Target's books
of Target's Shares exchanged therefor shall be paid by the person to
whom Acquiring Fund's Shares are to be issued, as a condition of
such transfer.
20
2. VALUATION
2.1. For purposes of paragraph 1.1(a), Target's net value shall be (a)
the value of the Assets computed as of the close of regular trading
on the New York Stock Exchange ("NYSE") on the date of the Closing
as defined in paragraph 3.1 ("Valuation Time"), using the valuation
procedures set forth in Target's then current prospectus and
statement of additional information less (b) the amount of the
Liabilities as of the Valuation Time.
2.2. For purposes of paragraph 1.1(a), the NAV of Acquiring Fund's Shares
shall be computed as of the Valuation Time, using the valuation
procedures set forth in Acquiring Fund's then current prospectus and
statement of additional information.
2.3. All computations pursuant to paragraphs 2.1 and 2.2 shall be made by
or under the direction of Investec Asset Management U.S. Limited.
3. CLOSING AND EFFECTIVE TIME
3.1. The Reorganization, together with related acts necessary to
consummate the same ("Closing"), shall occur at the Funds' principal
offices, located at 1055 Washington Blvd., Stamford, CT 06901 on
____________, 2001, or at such other place and/or on such other date
upon which the parties may agree. All acts taking place at the
Closing shall be deemed to take place simultaneously as of the close
of business on the date thereof or at such other time upon which the
parties may agree ("Effective Time"). If, immediately before the
Valuation Time, (a) the NYSE is closed to trading or trading thereon
is restricted or (b) trading or the reporting of trading on the NYSE
or elsewhere is disrupted, so that accurate appraisal of the net
value of Target and the NAV for Acquiring Fund is impracticable, the
Effective Time shall be postponed until the first business day after
the day when such trading shall have been fully resumed and such
reporting shall have been restored.
3.2. Target shall deliver to the Trust at the Closing a schedule of its
Assets as of the Effective Time, which shall set forth for all
portfolio securities included therein their adjusted tax bases and
holding periods by lot. Target's custodian shall deliver at the
Closing a certificate of an authorized officer stating that (a) the
Assets held by the custodian will be transferred to Acquiring Fund
at the Effective Time and (b) all necessary taxes in conjunction
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.
3.3. The Transfer Agent shall deliver at the Closing a certificate as to
the opening on Acquiring Fund's share transfer books of accounts in
the names of Target's Shareholders. The Trust shall issue and
deliver a confirmation to Target evidencing Acquiring Fund's Shares
to be credited to Target at the Effective Time or provide evidence
satisfactory to Target that Acquiring Fund's Shares have been
credited to Target's account on Acquiring Fund's books. At the
Closing, each party shall deliver
21
to the other such bills of sale, checks, assignments, stock
certificates, receipts, or other documents as the other party or its
counsel may reasonably request.
3.4. The Trust, on behalf of Target and Acquiring Fund, respectively,
shall deliver at the Closing a certificate executed in its name by
its President or a Vice President and dated as of the Effective
Time, to the effect that the representations and warranties it made
in this Agreement are true and correct in all material respects at
the Effective Time, with the same force and effect as if made at and
as of the Effective Time, except as they may be affected by the
transactions contemplated by this Agreement.
4. REPRESENTATIONS AND WARRANTIES
4.1. Target represents and warrants as follows:
4.1.1. At the Closing, Target will have good and marketable title to
its Assets and full right, power, and authority to sell, assign,
transfer, and deliver its Assets free of any liens or other
encumbrances; and upon delivery and payment for the Assets,
Acquiring Fund will acquire good and marketable title thereto;
4.1.2. Acquiring Fund's Shares are not being acquired for the
purpose of making any distribution thereof, other than in
accordance with the terms hereof;
4.1.3. Target's current prospectus and statement of additional
information conform in all material respects to the applicable
requirements of the Securities Act of 1933, as amended (the "1933
Act"), and the Investment Company Act of 1940, as amended (the
"1940 Act"), and the rules and regulations thereunder, and do not
include any untrue statement of a material fact or omit any
material fact required to be stated therein or necessary to make
the statements therein, in light of the circumstances under which
they were made, not misleading;
4.1.4. Target is not in violation of, and the execution and
delivery of this Agreement and consummation of the transactions
contemplated hereby will not (a) conflict with or violate
Delaware law or any provision of the Trust's Trust Instrument or
By-laws or of any agreement, instrument, lease, or other
undertaking to which Target is a party or by which it is bound or
(b) result in the acceleration of any obligation, or the
imposition of any penalty, under any agreement, judgment, or
decree to which Target is a party or by which it is bound, except
as previously disclosed in writing to and accepted by the Trust;
4.1.5. Except as otherwise disclosed in writing to and accepted by
the Trust, all material contracts and other commitments of or
applicable to Target (other than this Agreement and investment
contracts, including options and futures) will be terminated, or
provision for discharge of any liabilities of Target thereunder
will be made, at or prior to the Effective Time, without Target
incurring any liability or penalty with respect thereto and
without diminishing or releasing any rights Target may have had
with respect to actions taken or not taken by any other party
thereto prior to the Closing;
22
4.1.6. Except as otherwise disclosed in writing to and accepted by
the Trust on behalf of Acquiring Fund, no litigation,
administrative proceeding, or investigation of or before any
court or governmental body is presently pending or (to Target's
knowledge) threatened against Target or any of its properties or
assets that, if adversely determined, would materially and
adversely affect Target's financial condition or the conduct of
its business; Target knows of no facts that might form the basis
for the institution of any such litigation, proceeding, or
investigation and is not a party to or subject to the provisions
of any order, decree, or judgment of any court or governmental
body that materially or adversely affects its business or its
ability to consummate the transactions contemplated hereby;
4.1.7. The execution, delivery, and performance of this Agreement
has been duly authorized as of the date hereof by all necessary
action on the part of the Trust's Board of Trustees on behalf of
Target, which has made the determinations required by Rule
17a-8(a) under the 1940 Act; and, subject to approval by Target's
shareholders and receipt of any necessary exemptive relief or
no-action assurances requested from the Securities and Exchange
Commission ("SEC") or its staff with respect to Sections 17(a)
and 17(d) of the 1940 Act, this Agreement will constitute a valid
and legally binding obligation of Target, enforceable in
accordance with its terms, except as the same may be limited by
bankruptcy, insolvency, fraudulent transfer, reorganization,
moratorium, and similar laws relating to or affecting creditors'
rights and by general principles of equity;
4.1.8. At the Effective Time, the performance of this Agreement
shall have been duly authorized by all necessary action by
Target's shareholders;
4.1.9. No governmental consents, approvals, authorizations, or
filings are required under the 1933 Act, the Securities Exchange
Act of 1934, as amended ("1934 Act"), or the 1940 Act for the
execution or performance of this Agreement by Target, except for
(a) a proxy statement ("Proxy Statement"), the information for
which is included in a combined prospectus and proxy statement
filed by Acquiring Fund with the SEC on Form N-14, (b) receipt of
the exemptive relief or no-action assurances referenced in
subparagraph 4.1.7, and (c) such consents, approvals,
authorizations, and filings as have been made or received or as
may be required subsequent to the Effective Time;
4.1.10.On the effective date of the Registration Statement, at the
time of the shareholders' meeting referred to in paragraph 5.2,
and at the Effective Time, the Proxy Statement will (a) comply in
all material respects with the applicable provisions of the 1933
Act, the 1934 Act, and the 1940 Act and the rules and regulations
thereunder and (b) not contain any untrue statement of a material
fact or omit any material fact required to be stated therein or
necessary to make the statements therein, in light of the
circumstances under which such statements were made, not
misleading. This provision shall not apply to statements in or
omissions from the Proxy Statement made in reliance on and in
conformity with information furnished by the Trust for use
therein.
23
4.2. Acquiring Fund represents and warrants as follows:
4.2.1. Acquiring Fund's Shares to be issued and delivered to
Target hereunder will, at the Effective Time, have been duly
authorized and, when issued and delivered as provided herein,
will be duly and validly issued and outstanding shares of
Acquiring Fund, fully paid and nonassessable by the Trust (except
as disclosed in the Trust's then current prospectus and statement
of additional information). Except as contemplated by this
Agreement, Acquiring Fund does not have outstanding any options,
warrants, or other rights to subscribe for or purchase any of its
shares, nor is there outstanding any security convertible into
any of its shares;
4.2.2. Acquiring Fund's current prospectus and statement of
additional information conform in all material respects to the
applicable requirements of the 1933 Act and the 1940 Act and the
rules and regulations thereunder and do not include any untrue
statement of a material fact or omit any material fact required
to be stated therein or necessary to make the statements therein,
in light of the circumstances under which they were made, not
misleading;
4.2.3. Acquiring Fund is not in violation of, and the execution
and delivery of this Agreement and consummation of the
transactions contemplated hereby (a) will not conflict with or
violate Delaware law or any provision of the Trust's Trust
Instrument or By-laws or any provision of any agreement,
instrument, lease, or other undertaking to which Acquiring Fund
is a party or by which it is bound or (b) result in the
acceleration of any obligation, or the imposition of any penalty,
under any agreement, judgment, or decree to which Acquiring Fund
is a party or by which it is bound, except as previously
disclosed in writing to and accepted by the Trust;
4.2.4. Except as otherwise disclosed in writing to and accepted by
the Trust on behalf of Target, no litigation, administrative
proceeding, or investigation of or before any court or
governmental body is presently pending or (to Acquiring Fund's
knowledge) threatened against the Trust with respect to Acquiring
Fund or any of its properties or assets that, if adversely
determined, would materially and adversely affect Acquiring
Fund's financial condition or the conduct of its business;
Acquiring Fund knows of no facts that might form the basis for
the institution of any such litigation, proceeding, or
investigation and is not a party to or subject to the provisions
of any order, decree, or judgment of any court or governmental
body that materially or adversely affects its business or its
ability to consummate the transactions contemplated hereby;
4.2.5. The execution, delivery, and performance of this Agreement
has been duly authorized as of the date hereof by all necessary
action on the part of the Trust's Board of Trustees on behalf of
Acquiring Fund, which has made the determinations required by
Rule 17a-8(a) under the 1940 Act; and, subject to receipt of any
necessary exemptive relief or no-action assurances requested from
the SEC or its staff with respect to Sections 17(a) and 17(d) of
the 1940 Act, this
24
Agreement will constitute a valid and legally binding obligation of
Acquiring Fund, enforceable in accordance with its terms, except as
the same may be limited by bankruptcy, insolvency, fraudulent
transfer, reorganization, moratorium, and similar laws relating to
or affecting creditors' rights and by general principles of equity;
4.2.6. No governmental consents, approvals, authorizations, or
filings are required under the 1933 Act, the 1934 Act, or the
1940 Act for the execution or performance of this Agreement by
the Trust, except for (a) the filing with the SEC of the
Registration Statement and a post-effective amendment to the
Trust's registration statement on Form N-14, (b) receipt of the
exemptive relief or no-action assurances referenced in
subparagraph 4.2.5, and (c) such consents, approvals,
authorizations, and filings as have been made or received or as
may be required subsequent to the Effective Time;
4.3. The Trust, on behalf of each Fund, represents and warrants to the
other as follows:
4.3.1. The Trust is a business trust that is duly organized,
validly existing, and in good standing under the laws of the
State of Delaware; and a copy of its Certificate of Trust is on
file with the Secretary of the State of Delaware;
4.3.2. The Trust is duly registered as an open-end management
investment company under the 1940 Act, and such registration will
be in full force and effect at the Effective Time;
4.3.3. Each Fund is a duly established and designated series of
the Trust.
5. COVENANTS
5.1. Each Fund covenants to operate its respective business in the
ordinary course between the date hereof and the Closing, it being
understood that (a) such ordinary course will include declaring and
paying customary dividends and other distributions and such changes
in operations as are contemplated by each Fund's normal business
activities and (b) each Fund will retain exclusive control of the
composition of its portfolio until the Closing, provided that Target
shall not dispose of more than an insignificant portion of its
historic business assets during such period without Acquiring Fund's
prior consent.
5.2. Target covenants to call a special meeting of shareholders to
consider and act upon this Agreement and to take all other action
necessary to obtain approval of the transactions contemplated hereby.
5.3. Target covenants that Acquiring Fund's Shares to be delivered
hereunder are not being acquired for the purpose of making any
distribution thereof, other than in accordance with the terms hereof.
5.4. Target covenants that it will assist the Trust in obtaining such
information as the Trust reasonably requests concerning the
beneficial ownership of Target's Shares.
25
5.5. Target covenants that its books and records (including all books and
records required to be maintained under the 1940 Act and the rules
and regulations thereunder) will be turned over to the Trust at the
Closing.
5.6. Each Fund covenants to cooperate in preparing the Proxy Statement in
compliance with applicable federal securities laws.
5.7. Each Fund covenants that it will, from time to time, as and when
requested by the other 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 the other
Fund may deem necessary or desirable in order to vest in, and
confirm to (a) Acquiring Fund, title to and possession of all
Target's Assets, and (b) Target, title to and possession of
Acquiring Fund's Shares to be delivered hereunder, and otherwise to
carry out the intent and purpose hereof.
5.8. Acquiring Fund covenants to use all reasonable efforts to obtain the
approvals and authorizations required by the 1933 Act, the 1940 Act,
and such state securities laws as it may deem appropriate in order
to continue its operations after the Effective Time.
5.9. Subject to this Agreement, each Fund covenants to take or cause to
be taken all actions, and to do or cause to be done all things,
reasonably necessary, proper, or advisable to consummate and
effectuate the transactions contemplated hereby.
6. CONDITIONS PRECEDENT
6.1. Each Fund's obligations hereunder shall be subject to (a)
performance by the other Fund of all the obligations to be performed
hereunder at or before the Effective Time, (b) all representations
and warranties of the other Fund contained herein being true and
correct in all material respects as of the date hereof and, except
as they may be affected by the transactions contemplated hereby, as
of the Effective Time, with the same force and effect as if made at
and as of the Effective Time, and (c) the following further
conditions that, at or before the Effective Time:
6.1.1. This Agreement and the transactions contemplated hereby
shall have been duly adopted and approved by the Trust's Board of
Trustees on behalf of Target and Acquiring Fund and shall have
been approved by Target's shareholders in accordance with
applicable law.
6.1.2. All necessary filings shall have been made with the SEC and
state securities authorities, and no order or directive shall
have been received that any other or further action is required
to permit the parties to carry out the transactions contemplated
hereby. The Registration Statement shall have become effective
under the 1933 Act, no stop orders suspending the effectiveness
thereof shall have been issued, and the SEC shall not have issued
an unfavorable report with respect to the Reorganization under
Section 25(b) of the 1940 Act nor instituted any proceedings
seeking to enjoin consummation of the transactions contemplated
hereby under Section 25(c) of the 1940 Act. All consents,
orders, and permits of
26
federal, state, and local regulatory authorities (including the SEC
and state securities authorities) deemed necessary by either Fund to
permit consummation, in all material respects, of the transactions
contemplated hereby shall have been obtained, except where failure
to obtain the same would not involve a risk of a material adverse
effect on the assets or properties of the Fund.
6.1.3. At the Effective Time, no action, suit, or other proceeding
shall be pending before any court or governmental agency in which
it is sought to restrain or prohibit, or to obtain damages or
other relief in connection with, the transactions contemplated
hereby.
6.1.4. Target shall have received an opinion of Kramer Levin
Naftalis & Frankel LLP, counsel to the Trust ("Counsel"),
substantially to the effect that:
6.1.4.1. Acquiring Fund is a validly existing series of the Trust, a
business trust duly formed and validly existing and in good
standing under the laws of the State of Delaware with the
power under its Trust Instrument to carry on its business
and to own all of its properties and assets;
6.1.4.2. This Agreement (a) has been duly authorized and executed by
the Trust on behalf of Acquiring Fund and (b) assuming due
authorization, execution, and delivery of this Agreement by
Target, is a legal, valid and binding obligation of
Acquiring Fund, enforceable against Acquiring Fund in
accordance with its terms, except as such enforceability
may be limited by (i) bankruptcy, insolvency,
reorganization, receivership, fraudulent conveyance,
moratorium or other laws of general application relating to
or affecting the enforcement of creditors' rights and
remedies, as from time to time in effect, (ii) application
of equitable principles (regardless of whether such
enforceability is considered in a proceeding in equity or
at law) and (iii) principles of course of dealing or course
of performance and standards of good faith, fair dealing,
materiality and reasonableness that may be applied by a
court to the exercise of rights and remedies;
6.1.4.3. Acquiring Fund's Shares to be issued and delivered to the
Shareholders under this Agreement, assuming their due
delivery as contemplated by this Agreement, will be duly
authorized and validly issued and outstanding and fully
paid and nonassessable (except as disclosed in the Trust's
then current prospectus and statement of additional
information);
6.1.4.4. The execution and delivery of this Agreement did not, and
the consummation of the transactions contemplated hereby
will not (a) materially violate the Trust's Trust
Instrument or By-laws or any provision of any agreement to
which the Trust (with respect to Acquiring Fund) is a party
or by which it is bound or (b) to the knowledge of Counsel,
result in the acceleration of any obligation, or the
imposition of any penalty, under any agreement, judgment,
or decree known to Counsel to which the Trust (with respect
to Acquiring Fund) is a party or by which it (with respect
to
27
Acquiring Fund) is bound, except as set forth in such
opinion or as previously disclosed in writing to and
accepted by the Trust;
6.1.4.5. To the knowledge of Counsel, no consent, approval,
authorization or order of any Delaware or Federal Court or
governmental authority of the State of Delaware or the
United States of America is required for the consummation
by the Trust on behalf of Acquiring Fund, of the
transactions contemplated by the Agreement, except such as
may be required under the 1933 Act, the 1934 Act and the
1940 Act and under securities laws of states other than the
State of Delaware;
6.1.4.6. The Trust is registered with the SEC as an investment
company, and to the knowledge of Counsel no order has been
issued or proceeding instituted to suspend such
registration; and
6.1.4.7. To the knowledge of Counsel, (a) no litigation,
administrative proceeding, or investigation of or before
any court or governmental body is pending or threatened as
to the Trust (with respect to Acquiring Fund) or any of its
properties or assets attributable or allocable to Acquiring
Fund and (b) the Trust (with respect to Acquiring Fund) is
not a party to or subject to the provisions of any order,
decree, or judgment of any court or governmental body that
materially and adversely affects Acquiring Fund's business,
except as set forth in such opinion or as otherwise
disclosed in writing to and accepted by the Trust.
In rendering such opinion, Counsel may (i) rely, as to matters
governed by the laws of the State of Delaware, on an opinion of
competent Delaware counsel, (ii) make assumptions regarding the
authenticity, genuineness, and/or conformity of documents and
copies thereof without independent verification thereof, and other
customary assumptions as the parties may agree, (iii) limit such
opinion to applicable federal and state law, (iv) define the word
"knowledge" and related terms to mean the knowledge of attorneys
then with such firm who have devoted substantive attention to
matters directly related to this Agreement and the Reorganization;
and (v) rely on certificates of officers or trustees of the Trust,
in each case reasonably acceptable to the Trust.
6.1.5. Acquiring Fund shall have received an opinion of Counsel,
substantially to the effect that:
6.1.5.1. Target is a validly existing series of the Trust, a
business trust duly organized and validly existing and in
good standing under the laws of the State of Delaware with
power under its Trust Instrument to own all of its
properties and assets and, to the knowledge of Counsel, to
carry on its business as presently conducted;
6.1.5.2. This Agreement (a) has been duly authorized and executed by
the Trust on behalf of Target and (b) assuming due
authorization, execution, and
28
delivery of this Agreement by the Trust on behalf of Acquiring
Fund, is a legal, valid and binding obligation of Target,
enforceable against Target in accordance with its terms,
except as such enforceability may be limited by (i)
bankruptcy, insolvency, reorganization, receivership,
fraudulent conveyance, moratorium or other laws of general
application relating to or affecting the enforcement of
creditors' rights and remedies, as from time to time in
effect, (ii) application of equitable principles (regardless
of whether such enforceability is considered in a proceeding
in equity or at law) and (iii) principles of course of dealing
or course of performance and standards of good faith, fair
dealing, materiality and reasonableness that may be applied by
a court to the exercise of rights and remedies;
6.1.5.3. The execution and delivery of this Agreement did not, and
the consummation of the transactions contemplated hereby
will not, (a) materially violate the Trust's Trust
Instrument or By-laws or any provision of any agreement
known to Counsel, to which the Trust (with respect to
Target) is a party or by which it is bound or (b) to the
knowledge of such counsel, result in the acceleration of
any obligation, or the imposition of any penalty, under any
agreement, judgment, or decree known to Counsel to which
the Trust (with respect to Target) is a party or by which
it (with respect to Target) is bound, except as set forth
in such opinion or as previously disclosed in writing to
and accepted by the Trust;
6.1.5.4. To the knowledge of Counsel, no consent, approval,
authorization or order of any Delaware or Federal Court or
governmental authority of the State of Delaware or the
United States of America is required for the consummation
by the Trust on behalf of Target, of the transactions
contemplated by the Agreement, except such as may be
required under the 1933 Act, the 1934 Act and the 1940 Act
and under securities laws of states other than the State of
Delaware;
6.1.5.5. The Trust is registered with the SEC as an investment
company, and to the knowledge of Counsel no order has been
issued or proceeding instituted to suspend such
registration; and
6.1.5.6. To the knowledge of Counsel, (a) no litigation,
administrative proceeding, or investigation of or before
any court or governmental body is pending or threatened as
to the Trust (with respect to Target) or any of its
properties or assets attributable or allocable to Target
and (b) the Trust (with respect to Target) is not a party
to or subject to the provisions of any order, decree, or
judgment of any court or governmental body that materially
and adversely affects Target's business, except as set
forth in such opinion or as otherwise disclosed in writing
to and accepted by the Trust.
In rendering such opinion, Counsel may (i) rely, as to matters
governed by the laws of the State of Delaware, on an opinion of
competent Delaware counsel, (ii) make assumptions regarding the
authenticity, genuineness, and/or conformity of
29
documents and copies thereof without independent verification
thereof, and other customary assumptions as the parties may agree,
(iii) limit such opinion to applicable federal and state law, (iv)
define the word "knowledge" and related terms to mean the knowledge
of attorneys then with such firm who have devoted substantive
attention to matters directly related to this Agreement and the
Reorganization, and (v) rely on certificates of officers or trustees
of Target; in each case reasonably acceptable to the Trust.
6.1.6. The Trust, on behalf of Target and Acquiring Fund, shall
have received an opinion of Counsel addressed to and in
form and substance reasonably satisfactory to it, as to the
federal income tax consequences of the Reorganization ("Tax
Opinion"). In rendering the Tax Opinion, Counsel may rely
as to factual matters, exclusively and without independent
verification, on the representations made in this Agreement
(and/or in separate letters addressed to Counsel) and each
Fund's separate covenants. Each Fund agrees to make
reasonable covenants and representations as to factual
matters as of the Effective Time in connection with the
rendering of such opinion.
6.2. At any time before the Closing, either Fund may waive any of the
foregoing conditions if, in the judgment of the Trust's Board of
Trustees, such waiver will not have a material adverse effect on its
shareholders' interests.
7. BROKERAGE FEES AND EXPENSES
7.1. The Trust, on behalf of each Fund, represents and warrants that
there are no brokers or finders entitled to receive any payments in
connection with the transactions provided for herein.
7.2. Investec Asset Management U.S. Limited will be responsible for paying
all expenses incurred in connection with the Reorganization.
8. ENTIRE AGREEMENT; SURVIVAL
8.1. Neither party has made any representation, warranty, or covenant not
set forth herein, and this Agreement constitutes the entire
agreement between the parties. The representations, warranties, and
covenants contained herein or in any document delivered pursuant
hereto or in connection herewith shall survive the Closing.
9. TERMINATION OF AGREEMENT
9.1. This Agreement may be terminated at any time at or prior to the
Effective Time, whether before or after approval by Target's
Shareholders:
9.1.1. By either Fund (a) in the event of a material breach of any
representation, warranty, or covenant contained herein to be
performed at or prior to the Effective Time, (b) if a condition
to its obligations has not been met and it reasonably
30
appears that such condition will not or cannot be met, or (c) if the
Closing has not occurred on or before _____________, 2002; or
9.1.2. By the parties' mutual agreement.
9.2. In the event of termination under paragraphs 9.1.1(a), (b) or (c) or
9.1.2, there shall be no liability for damages on the part of either
Fund affected by the termination, or the trustees or officers of the
Trust, to the other Fund.
10. AMENDMENT
10.1. This Agreement may be amended, modified, or supplemented at any
time, notwithstanding approval thereof by Target's Shareholders, in
such manner as may be mutually agreed upon in writing by the
parties; provided that following such approval no such amendment
shall have a material adverse effect on such Shareholders' interests.
11. MISCELLANEOUS
11.1. This Agreement shall be governed by and construed in accordance with
the internal laws of the State of Delaware; provided that, in the
case of any conflict between such laws and the federal securities
laws, the latter shall govern.
11.2. Nothing expressed or implied herein is intended or shall be
construed to confer upon or give any person, firm, trust, or
corporation other than the parties and their respective successors
and assigns any rights or remedies under or by reason of this
Agreement.
11.3. The parties acknowledge that the Trust is a business trust. Notice
is hereby given that this instrument is executed on behalf of the
Trust's Trustees solely in their capacity as trustees, and not
individually, and that the Trust's obligations under this instrument
on behalf of each Fund are not binding on or enforceable against any
of its trustees, officers, or shareholders, but are only binding on
and enforceable against the respective Funds' assets and property.
Each Fund agrees that, in asserting any rights or claims under this
Agreement, it shall look only to the corresponding Fund's assets and
property in settlement of such rights or claims and not to such
Trustees or shareholders or to the assets of any other series of the
Trust.
11.4. The Trust agrees to indemnify and hold harmless each Trustee of the
Trust at the time of the execution of this Agreement against
expenses, including reasonable attorneys' fees, judgments, fines and
amounts paid in settlement, actually and reasonably incurred by such
Trustee in connection with any claim that is asserted against such
trustee arising out of such person's service as a Trustee of the
Trust, provided that such indemnification shall be limited to the
full extent of the indemnification that is available to the Trustees
of the Trust pursuant to the provisions of the Trust's Trust
Instrument and applicable law.
31
11.5 The Trust, on behalf of each Fund, hereby waives any conflict
arising out of the representation of each Fund by Counsel.
IN WITNESS WHEREOF, each party has caused this Agreement to be executed
by its duly authorized officer.
ATTEST: INVESTEC FUNDS, on behalf of the
Investec Asia Small Cap Fund
By: _________________________________ By: ________________________________
Eric M. Banhazl Royce N. Brennan
Secretary President
ATTEST: INVESTEC FUNDS, on behalf of the
Investec Asia New Economy Fund
By: _________________________________ By: ________________________________
Eric M. Banhazl Royce N. Brennan
Secretary President
32
Part B
STATEMENT OF ADDITIONAL INFORMATION
_______, 2001
Acquisition of the Assets of
INVESTEC FUNDS
Asia New Economy Fund
by and in exchange for all the shares of
INVESTEC FUNDS
Asia Small Cap Fund
This Statement of Additional Information dated __________, 2001, is not a
prospectus, but should be read in conjunction with the Combined Proxy Statement
and Prospectus dated ___________, 2001. This Statement of Additional Information
is incorporated by reference in its entirety into the Combined Proxy Statement
and Prospectus. Copies of the Combined Proxy Statement and Prospectus may be
obtained by writing Investec Funds at 1055 Washington Blvd., 3rd Floor,
Stamford, CT 06901 or by calling toll free 1-800-915-6565.
TABLE OF CONTENTS
Page
Statement of Additional Information of the Investec Asia Small Cap
Fund and Investec Asia New Economy Fund, both of which are series of
the Investec Funds, dated April 26, 2001. 2
Financial Statements of Investec Asia Small Cap Fund and Investec
Asia New Economy Fund, dated December 31, 2000 and June 30, 2001. 2
STATEMENT OF ADDITIONAL INFORMATION OF THE REGISTRANT AND OF THE COMPANY
BEING ACQUIRED
The Statement of Additional Information of the Investec Asia Small Cap
Fund (the "Registrant") and the Investec Asia New Economy Fund (the "Company
Being Acquired"), both of which are series of the Investec Funds, dated April
26, 2001, as filed with the Securities and Exchange Commission on April 26,
2001, pursuant to Rule 485(b) (File No. 33-75340) hereby is incorporated by
reference. You may obtain a copy at no cost by writing Investec Funds at 1055
Washington Blvd., 3rd Floor, Stamford, CT 06901 or by calling toll free
1-800-915-6565.
FINANCIAL STATEMENTS OF THE REGISTRANT AND OF THE COMPANY BEING ACQUIRED
The audited and unaudited Financial Statements of the Investec Asia
Small Cap Fund (the "Registrant") and the Investec Asia New Economy Fund (the
"Company Being Acquired"), both of which are series of the Investec Funds,
are incorporated by reference to the Annual Report and Semi-Annual Report of
the Investec Funds (File No. 33-75340) dated December 31, 2000 and June 30,
2001, respectively. You may obtain copies at no cost by writing Investec
Funds at 1055 Washington Blvd., 3rd Floor, Stamford, CT 06901 or by calling
toll free 1-800-915-6565.
The following unaudited pro forma financial information combines the
Schedules of Portfolio Investments, the Statements of Assets and Liabilities,
and the Statements of Operations, as of September 30, 2001, of the Investec Asia
New Economy Fund and the Investec Asia Small Cap Fund to reflect the
reorganization of the Investec Asia New Economy Fund into the Investec Asia
Small Cap Fund. The pro forma financial information shows the expected effect of
the reorganization transaction on the Investec Asia Small Cap Fund.
INVESTEC ASIA NEW ECONOMY FUND AND
INVESTEC ASIA SMALL CAP FUND
PRO FORMA COMBINING PORTFOLIO OF INVESTMENTS
SEPTEMBER 30, 2001
(UNAUDITED)
- ------------------------------------------------------------------------------------------------------------------------------------
Shares Value
- ------------------------------------------------------------------------------------------------------------------------------------
Asia New Asia Small Asia New Asia Small
Economy Fund Cap Fund Pro Forma Economy Fund Cap Fund Pro Forma Pro Forma
(Historical) (Historical) Combined (Historical) (Historical) Adjust Combined
- ------------ ------------ -------- ------------ ------------ --------- ---------
Hong Kong
40,000 - 40,000 China Mobile (Hong Kong) Ltd.* $ 127,188 $ - $ - $ 127,188
- 1,400,000 1,400,000 Chaoda Modern Agriculture
(Holdings), Inc.* - 367,972 - 367,972
- 510,000 510,000 China Pharmaceutical Enterprise * - 654 - 654
81,000 - 81,000 China Unicom Ltd.* 87,236 - - 87,236
20,000 - 20,000 Citic Pacific Ltd. 37,695 - - 37,695
25,200 109,214 134,414 Dah Sing Financial Holdings 112,115 485,893 - 598,008
- 400,840 400,840 Esprit Holdings Ltd. - 380,309 - 380,309
- 672,000 672,000 Giordano International Ltd. - 303,712 (303,712) -
- 1,100,000 1,100,000 Global Bio -Chem Technology
Group Co. Ltd.* - 263,735 (263,735) -
- 5,200,000 5,200,000 Global Tech Holdings - 346,689 (346,689) -
- 577,777 577,777 Global Tech Holdings Wts. - 7,630 (7,630) -
- 2,000,000 2,000,000 Glorious Sun Enterprises Ltd. - 238,477 - 238,477
- 1,342,400 1,342,400 HKR International Ltd. - 301,199 (301,199) -
17,200 - 17,200 HSBC Holdings Plc 180,281 - - 180,281
33,000 - 33,000 Hutchison Whampoa 245,400 - - 245,400
- 850,000 850,000 JCG Holdings Ltd. - 460,446 - 460,446
70,000 - 70,000 Johnson Electric Holdings 63,722 - - 63,722
- 962,000 962,000 Kingboard Chemicals Holdings Ltd.* - 428,611 (428,611) -
- 96,200 96,200 Kingboard Chemicals Holdings Ltd. Wts.* - 2,960 (2,960) -
32,000 - 32,000 Li & Fung Ltd. 30,361 - (30,361) -
- 652,000 652,000 Nanjing Panda Electronics Co., Ltd.* - 142,112 (142,112) -
373,142 - 373,142 Pacific Century CyberWorks Ltd. 91,856 - - 91,856
- 454,000 454,000 QPL International Holdings Ltd.* - 83,239 (83,239) -
- 90,800 90,800 QPL International Holdings Ltd. Wts.* - 2,561 (2,561) -
- 1,000,000 1,000,000 Quality Healthcare Asia Ltd.* - 32,694 (32,694) -
- 54,000 54,000 Roadshow Holdings Ltd. - 9,831 (9,831) -
- 230,000 230,000 Shui On Construction - 134,175 (134,175) -
- 1,400,000 1,400,000 Texwinca Holdings Ltd. - 426,309 - 426,309
- 560,000 560,000 Varitronix International Ltd. - 244,118 (244,118) -
35,000 - 35,000 Wharf Holdings Ltd. 58,113 - (58,113) -
17,000 70,000 87,000 Wing Hang Bank Ltd. 53,183 218,988 - 272,171
1,087,150 4,882,314 (2,391,740) 3,577,724
Malaysia
- 300,000 300,000 Gamuda Berhad - 331,579 - 331,579
- 200,000 200,000 Hong Leong Bank - 168,421 - 168,421
13,000 84,000 84,000 Unisem (M) Berhad 23,434 151,421 - 174,855
23,434 651,421 - 674,855
Philippines
- 700,000 700,000 Cosmos Bottling Corp. - 79,065 - 79,065
Singapore
- 380,000 380,000 Comfort Group Ltd. - 124,763 - 124,763
- 71,800 71,800 Datacraft Asia Ltd. - 235,504 - 235,504
17,890 - 17,890 DBS Group Holdings Ltd. 97,726 - (97,726) -
- 340,000 340,000 First Captial Corp. - 178,031 (178,031) -
- 220,000 220,000 Flextech Holdings Ltd. - 47,324 - 47,324
9,000 - 9,000 Singapore Press Holdings 80,496 - (80,496) -
8,120 - 8,120 United Overseas Bank 44,127 - - 44,127
14,000 52,000 66,000 Venture Manufacturing Ltd. 69,344 257,564 - 326,908
291,693 843,186 (356,253) 778,626
South Korea
- 5,200 5,200 Cheil Communications, Inc. - 367,270 (367,270) -
- 37,750 37,750 Daeduck Electrnoics Co., Ltd. - 243,175 - 243,175
- 28,000 28,000 Future Systems Inc. - 256,595 (256,595) -
- 11,000 11,000 Humax Co., Ltd. - 160,276 - 160,276
12,500 - 12,500 Kookmin Bank 154,333 - - 154,333
- 77,800 77,800 Korea Circuit Co. - 187,937 (187,937) -
3,907 - 3,907 Korea Telecom Corp. ADR 68,372 - (68,372) -
1,830 - 1,830 Samsung Electronics GDR 196,472 - - 196,472
22,000 - 22,000 Shinhan Financial Group Ltd. 166,687 - - 166,687
- 8,044 8,044 Shinsegae Department Stores - 567,522 - 567,522
780 - 780 SK Telecom Co. 124,417 - - 124,417
4,000 - 4,000 SK Telecom Co. Wts. 72,120 - - 72,120
- 2,000 22,000 Uniwide Technologies, Inc. - 79,295 - 79,295
782,401 1,862,070 (880,174) 1,764,297
Taiwan
1,031 - 1,031 Acer, Inc. 1,423 - (1,423) -
179,400 179,400 Advantech Co. Ltd. - 332,704 (332,704) -
13,000 97,856 110,856 Ambit Microsystems Corp. 42,002 316,168 - 358,170
49,400 - 49,400 Asustek Computer GDR 146,820 - - 146,820
29,400 - 29,400 Delta Electronic Industrial 32,118 - (32,118) -
58,800 58,800 Faraday Technology Corp.* - 183,164 (183,164) -
24,400 - 24,400 Hon Hai Precision Industry 77,068 - - 77,068
7,000 - 7,000 MediaTek, Inc. 51,116 - - 51,116
89,572 89,572 Procomp Informatics Co., Ltd.* - 94,737 - 94,737
Taiwan - (Continued)
236,155 236,155 Prodisc International* - 203,924 (203,924) -
30,000 148,500 178,500 Realtek Semiconductor Corp.* 81,715 404,491 - 486,206
87,455 - 87,455 Siliconware Precision GDR* 43,335 - - 43,335
75,270 75,270 Stark Technology, Inc.* - 221,384 (221,384) -
119,280 - 119,280 Taiwan Semiconductor Manufacturing
Co. Ltd.* 161,413 - - 161,413
117,150 - 117,150 United Microelectronics Corp.* 91,317 - - 91,317
12,000 - 12,000 Via Technologies, Inc.* 29,731 - - 29,731
306,944 306,944 Weltrend Semiconductor, Inc.* - 223,248 - 223,248
317,892 317,892 World Wiser Electronics, Inc.* - 155,676 - 155,676
299,223 299,223 Zyxel Communications Corp.* - 267,055 - 267,055
758,058 2,402,551 (974,717) 2,185,892
Thailand
8,000 - 8,000 Advanced Info Service (FB) 85,611 - - 85,611
- 600,000 600,000 United Broadcasting Corp.* 82,284 (82,284) -
85,611 82,284 (82,284) 85,611
Total Common Stocks
(cost $ 4,886,373 and
$16,342,338 respectively) 3,028,347 10,802,891 (4,685,168) 9,146,070
Total Investments in Securities
(cost $ 4,886,373 and
$16,342,338, respectively+) 3,028,347 10,802,891 (4,685,168) 9,146,070
Other Assets less Liabilities (69,346) 204,374 - 135,028
Net Assets $ 2,959,001 11,007,265 (4,685,168) $ 9,281,098
+ Cost for Federal income tax
purposes is the same.
Net unrealized appreciation
(depreciation) consists of:
Gross unrealized appreciation 84,081 $ 1,296,168 $ (189,990) $ 1,190,259
Gross unrealized depreciation (1,942,107) (6,835,615) 4,365,400 (4,412,322)
Net unrealized depreciation (1,858,026) (5,539,447) $ 4,175,410 (3,222,063)
* Non-income producing security.
Adjustments represent securities to be sold in connection with the
reorganization.
See accompanying Notes to Pro Forma Combining Financial Statements.
INVESTEC ASIA NEW ECONOMY FUND AND
INVESTEC ASIA SMALL CAP FUND
PRO FORMA COMBINING STATEMENT OF ASSETS AND LIABILITIES
SEPTEMBER 30, 2001
(UNAUDITED)
Asia New Asia Small
Economy Fund Cap Fund Pro Forma Pro Forma
(Historical) (Historical) Adjust Combined
-------------- -------------- -------------- -------------
ASSETS
Investments in securities, at cost (Note 2) $4,886,373 $16,342,338 ($8,860,578) $12,368,133
============= ============= ============= =============
Investments in securities, at value (Note 2) $3,028,347 $10,802,891 ($4,685,168) $9,146,070
Cash 20,905 231,739 -- 252,644
Receivables:
Fund shares sold 1,000 20,000 -- 21,000
Dividends and interest 3,216 8,518 -- 11,734
Due from advisor 819 349 -- 1,168
Prepaid expenses and other assets 5,479 3,239 -- 8,718
------------- ------------- ------------- -------------
Total assets 3,059,766 11,066,736 (4,685,168) 9,441,334
------------- ------------- ------------- -------------
LIABILITIES
Payables:
Securities purchased 66,406 -- -- 66,406
Unrealized loss on forward foreign currency contracts 74 -- -- 74
Due to Adviser (Note 2) -- -- 62,777 62,777
Accrued expenses (Note 2) 32,437 56,873 (62,777) 26,533
Deferred trustees' compensation 1,848 2,598 -- 4,446
------------- ------------- ------------- -------------
Total liabilities 100,765 59,471 -- 160,236
------------- ------------- ------------- -------------
NET ASSETS $2,959,001 $11,007,265 ($4,685,168) $9,281,098
============= ============= ============= =============
Number of shares issued and outstanding
(unlimited shares authorized no par value) 628,591 2,442,071 (1,012,769) 2,057,893
============= ============= ============= =============
Net asset value per share $4.71 $4.51 $4.51
============= ============= =============
COMPONENTS OF NET ASSETS
Paid-in capital $7,387,348 $107,356,586 $0 $114,743,934
Accumulated net investment income (loss) (6,930) 63,319 -- 56,389
Accumulated net realized loss on investments (2,563,603) (90,873,183) (8,860,578) (102,297,364)
Net unrealized appreciation (depreciation) on: --
Investments (1,858,026) (5,539,447) 4,175,410 (3,222,063)
Foreign currency 212 (10) -- 202
------------- ------------- ------------- -------------
Net assets $2,959,001 $11,007,265 ($4,685,168) $9,281,098
============= ============= ============= =============
See accompanying Notes to Pro Forma Combining Financial Statements.
INVESTEC ASIA NEW ECONOMY FUND AND
INVESTEC ASIA SMALL CAP FUND
PRO FORMA COMBINING STATEMENT OF OPERATIONS
SEPTEMBER 30, 2001
(UNAUDITED)
Asia New Asia Small
Economy Fund Cap Fund Pro Forma Pro Forma
(Historical) (Historical) Adjust Combined
------------- ------------- ------------- --------------
INVESTMENT INCOME
Income
Dividends + $63,020 $297,156 $0 $360,176
Interest 2,841 5,878 - 8,719
------------- ------------- ------------- --------------
Total income 65,861 303,034 - 368,895
------------- ------------- ------------- --------------
Expenses
Advisory fees 36,763 121,068 - 157,831
Fund accounting fees (Note 2) 42,423 44,226 (42,423) 44,226
Transfer agent fees 38,128 63,803 - 101,931
Custody fees 10,095 18,909 - 29,004
Administration fees 14,850 30,267 - 45,117
Audit fees (Note 2) 20,354 22,825 (20,354) 22,825
Registration expense 12,819 14,517 - 27,336
Reports to shareholders 3,720 20,769 - 24,489
Legal fees 1,878 6,519 - 8,397
Trustee fees 4,438 6,772 - 11,210
Insurance expense 359 2,199 - 2,558
Interest expense 2,924 12,404 - 15,328
Miscellaneous 2,395 3,223 - 5,618
------------- ------------- ------------- --------------
Total expenses 191,146 367,501 (62,777) 495,870
Less: fees waived and expenses absorbed (Note 2) (118,355) (127,786) 62,777 (183,364)
------------- ------------- ------------- --------------
Net expenses 72,791 239,715 - 312,506
------------- ------------- ------------- --------------
Net investment income (loss) (6,930) 63,319 - 56,389
------------- ------------- ------------- --------------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS
Net realized loss on investments (Note 2) (602,701) (2,561,499) (8,860,578) (12,024,778)
Net realized loss on foreign currency (12,489) (37,880) - (50,369)
Net unrealized appreciation (depreciation) on:
Investments (Note 2) (860,740) 1,421,249 4,175,410 4,735,919
Foreign currency (2,128) 1,002 - (1,126)
------------- ------------- ------------- --------------
Net realized and unrealized loss on investments (1,478,058) (1,177,128) (4,685,168) (7,340,354)
------------- ------------- ------------- --------------
Net decrease in net assets resulting
from operations ($1,484,988) ($1,113,809) ($4,685,168) ($7,283,965)
============= ============= ============= ==============
+ Net of foreign tax withheld of $12,226 for the Asia New Economy Fund and
$30,939 for the Asia Small Cap Fund.
See accompanying Notes to Pro Forma Combining Financial Statements.
INVESTEC FUNDS
NOTES TO PRO FORMA COMBINING FINANCIAL STATEMENT
NOTE 1 - BASIS OF PRO FORMA PRESENTATION
The pro forma combining financial statements and the accompanying pro forma
schedules of investments give effect to the proposed Agreements and Plans of
Reorganization pursuant to which the Investec Asia New Economy Fund (the
"Acquired Fund") will transfer all of its assets and liabilities to the
Investec Asia Small Cap Fund (the "Acquiring Fund"), respectively, in
exchange for shares of the corresponding Acquiring Fund. The Investec Asia
Small Cap Fund will be the legal and accounting survivor of the
reorganizations. The pro forma statements should be read in conjunction with
the historical financial statements of the Investec Asia New Economy Fund and
the Investec Asia Small Cap Fund included in the Statement of Additional
Information.
The costs of the reorganization will be borne by Investec Asset Management
U.S. Limited (the "Adviser") and is estimated to be $19,183.
It is contemplated that the reorganizations will be accounted for as a
tax-free reorganization of investment companies.
NOTE 2 - PRO FORMA ADJUSTMENTS
Pro forma adjustments have been made to give effect to each of the following
as if the reorganizations had occurred as of the beginning of each period
presented:
A - To eliminate Fund Accounting expenses for the Investec Asia New
Economy Fund.
B - To eliminate Audit expenses for the Investec Asia New Economy Fund.
C - Adjust for securities to be sold in connection with reorganization.
INVESTEC FUNDS
PART C
ITEM 15. INDEMNIFICATION.
The response to this item is incorporated by reference to Item 25 of Part C
of Post-Effective Amendment No. 29 to the Registrant's Registration Statement
on Form N-1A as filed April 26, 2001, accession number 0000922423-01-500074.
Item 16. Exhibits:
(1)(a) Certificate of Trust. (1)
(1)(b) Amendment to Certificate of Trust dated September 8, 2000. (2)
(2) Bylaws. (1)
(3) Not Applicable.
(4) Form of Agreement and Plan of Reorganization and Liquidation.
(5)(a) Trust Instrument. (1)
(5)(b) Amendment to Trust Instrument. (2)
(5)(c) Schedule A to Trust Instrument as of June 28, 2000. (2)
(6) Investment Advisory Agreement between Registrant and Investec Asset
Management U.S. Limited (formerly Guinness Flight Investment
Management Limited). (3)
(7) General Distribution Agreement between Registrant and First Fund
Distributors, Inc. (3)
(8) Not Applicable.
(9) Amended Custodian Agreement between Registrant and Investors Bank &
Trust Company. (3)
(10)(a) Distribution and Service Plan. (3)
(10)(b) Form of Distribution Plan for a class of the Guinness Flight Wired(R)
Index Fund. (4)
- ---------------
(1) Filed as an Exhibit to Post-Effective Amendment No. 7 to Registrant's
Registration Statement on Form N-1A filed electronically on March 20,
1997, accession number 0000922423-96-000220 and incorporated herein by
reference.
(2) Filed as an Exhibit to Post-Effective Amendment No. 28 to Registrant's
Registration Statement on Form N-1A filed electronically on October 13,
2000, accession number 0000922423-96-500010 and incorporated herein by
reference.
(3) Filed as an Exhibit to Post-Effective Amendment No. 12 to Registrant's
Registration Statement on Form N-1A filed electronically on August 28,
1998, accession number 0000922423-98-000948 and incorporated herein by
reference.
(4) Filed as an Exhibit to Post-Effective Amendment No. 24 to Registrant's
Registration Statement on Form N-1A filed electronically on December 23,
1999, accession number 0000922423-99-001476 and incorporated herein by
reference.
C-1
(10)(c) Form of Rule 18f-3 Multi-Class Plan. (5)
(11)(a) Consent of Counsel.
(11)(b) Opinion of Counsel.
(12) Form of Tax Opinion.
(13) Not Applicable.
(14) Consent of Ernst & Young LLP, Independent Auditors for the
Registrant.
(15) Not Applicable.
(16) Powers of Attorney. (6)
(17) Form of Proxy Card.
ITEM 17. Undertakings
(1) The undersigned registrant agrees that prior to any public reoffering of the
securities registered through the use of a prospectus which is a part of
this registration statement by any person or party who is deemed to be an
underwriter within the meaning of Rule 145(c) under the Securities Act of
1933, as amended (the "Securities Act"), the reoffering prospectus will
contain the information called for by the applicable registration form for
reofferings by persons who may be deemed underwriters, in addition to the
information called for by the other items of the applicable form.
(2) The undersigned registrant agrees that every prospectus that is filed under
paragraph (1) above will be filed as a part of an amendment to the
registration statement and will not be used until the amendment is
effective, and that, in determining any liability under the Securities Act,
each post-effective amendment shall be deemed to be a new registration
statement for the securities offered therein, and the offering of the
securities at that time shall be deemed to be the initial bona fide offering
of them.
(3) The undersigned registrant agrees that the opinion of counsel concerning the
tax consequences of the transaction will be filed as part of a
post-effective amendment to the registration statement
- ---------------
(5) Filed as an Exhibit to Post-Effective Amendment No. 26 to Registrant's
Registration Statement on Form N-1A filed electronically on June 30, 2000,
accession number 0000922423-00-000903 and incorporated herein by
reference.
(6) Filed as an Exhibit to Registrant's Registration Statement on Form N-14
filed electronically on October 22, 2001, accession number
0000922423-01-500921 and incorporated herein by reference.
C-2
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Pre-Effective Amendment No. 1 to the Registration Statement
on Form N-14 to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of New York and State of New York, on the 16th day of
November, 2001.
INVESTEC FUNDS
By: /s/ Royce N. Brennan
-----------------------------------
Royce N. Brennan
President
Pursuant to the requirements of the Securities Act of 1933, this
Pre-Effective Amendment No. 1 to the Registration Statement on Form N-14 has
been signed below by the following persons in the capacities indicated on the
16th day ofof November, 2001.
Signature Title Date
/s/ Eric Banhazl Treasurer November 16, 2001
- -----------------------
Eric Banhazl
/s/ Dr. Gunter Dufey Trustee November 16, 2001
- -----------------------
*Dr. Gunter Dufey
/s/ J. I. Fordwood Trustee November 16, 2001
- -----------------------
*J. I. Fordwood
/s/ Timothy Guinness Trustee November 16, 2001
- -----------------------
*Timothy Guinness
/s/ Bret A. Herscher Trustee November 16, 2001
- -----------------------
*Bret A. Herscher
/s/ J. Brooks Reece, Jr. Trustee November 16, 2001
- -----------------------
*J. Brooks Reece, Jr.
*By: /s/ Susan Penry-Williams
---------------------------
Susan Penry-Williams
Attorney-in-Fact
EXHIBIT INDEX
EX-99.4 Form of Agreement and Plan of Reorganization and Liquidation.
EX-99.11(a) Consent of Counsel.
EX-99.11(b) Opinion of Counsel.
EX-99.12 Form of Tax Opinion.
EX-99.14 Consent of Ernst & Young LLP, Independent Auditors for the
Registrant.
EX-99.17 Form of Proxy Card.