(File Nos. 811-7242; 33-52850)
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934
(Amendment No. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[X] Preliminary Proxy Statement
[ ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to ss.240.14a-11(c) or ss.240.14a-12
THE CUTLER TRUST
(Name of Registrant as Specified in its Charter)
D. Blaine Riggle, Esq.
Forum Financial Services, Inc.
Payment of Filing Fee (Check the appropriate box):
[X] No Fee Required
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and 0-11
1) Title of each class of securities to which transaction
applies:
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2) Aggregate number of securities to which transaction
applies:
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3) Per unit price or other underlying value of transaction
computed pursuant to Exchange Act Rule 0-11:
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Exchange Act Rule 0-11(a)(2) and identify the filing for which
the offsetting fee was paid previously. Identify the previous
filing by registration statement number, or the Form or
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1) Amount Previously Paid:
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4) Date Filed:
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April 2, 1999
Dear Shareholders:
In an effort to provide the highest level of return possible for a given level
of risk, we would like to initiate changes to the investment criteria of the
Cutler Approved List Equity Fund ("Fund"). We feel these changes will result in
our ability to maintain a conservative portfolio of companies that reflect our
shareholders' desire for owning large, well respected and financially solid
industry leaders, while also maintaining a stable income stream. The desired
changes to the Fund's objectives and corresponding investment policies will
expand the Funds' investable universe. This expansion allows for greater
diversification as well as the potential for better investment returns.
DIVERSIFICATION BENEFITS - When the Fund's current investment policies are
followed, entire industry categories, including leading issues in the major
averages, are removed from the Fund's investable universe. Eliminating the
current restrictions, set in place a generation ago, will bring us more in line
with current major institutional practice.
RETURN ENHANCEMENT - Broadening the number of eligible investment candidates
allows us to own the companies that in our opinion have the greatest potential
for price appreciation; this increases the likelihood of higher portfolio
returns.
Your investment in this Fund indicates a desire to own large, well-respected,
financially solid industry leaders. We will continue to maintain a bias toward
dividend paying companies. The desired changes will greatly expand the Fund's
universe of investment candidates but will not alter the basic premise in which
you invested. We are excited by the potential for enhanced investment results
and hope you share our enthusiasm.
Sincerely,
Kenneth R. Cutler Robert W. Lamberti, CFA
Chairman Senior Portfolio Manager
PRELIMINARY COPIES
THE CUTLER TRUST
TWO PORTLAND SQUARE
PORTLAND, MAINE 04101
(888) CUTLER4
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
April 28, 1999
To the Shareholders of The Cutler Trust:
NOTICE IS HEREBY GIVEN that a Special Meeting of Shareholders (the
"Meeting") of the Cutler Approved List Equity Fund (the "Fund"), a series of The
Cutler Trust (the "Trust"), will be held at the offices of the Trust, Two
Portland Square, Portland, Maine 04101, on April 28, 1999 (at 10:00 a.m.), for
the following purposes, all of which are more fully described in the
accompanying Proxy Statement dated April 2, 1999:
(1) To approve or disapprove a proposal to modify the Fund's
investment objective and to effect corresponding revisions of
the Fund's investment policies;
(2) To approve or disapprove a proposal to remove the Fund's
fundamental investment limitation regarding foreign
investment; and
(3) To transact such other business as may properly come before
the Meeting or any adjournment thereof.
The Trustees have fixed the close of business on March 15, 1999 as the
record date for the determination of shareholders entitled to notice of and to
vote at the Meeting or any adjournment thereof. The enclosed proxy is being
solicited on behalf of the Trustees.
By order of the Board of Trustees,
D. Blaine Riggle
Secretary
April 2, 1999
Portland, Maine
YOUR VOTE IS IMPORTANT NO MATTER HOW LARGE OR SMALL YOUR HOLDINGS MAY BE. IN
ORDER TO AVOID THE UNNECESSARY EXPENSE OF FURTHER SOLICITATION, WE URGE YOU TO
INDICATE YOUR VOTING INSTRUCTIONS ON THE ENCLOSED PROXY, DATE AND SIGN IT, AND
RETURN IT PROMPTLY IN THE ENVELOPE PROVIDED.
THE CUTLER TRUST
TWO PORTLAND SQUARE
PORTLAND, MAINE 04101
(888) CUTLER4
PROXY STATEMENT
The enclosed proxy is solicited by the Board of Trustees of The Cutler
Trust (the "Trust"), a Delaware business trust, on behalf of Cutler Approved
List Equity Fund (the "Fund"). The Trust is a registered open-end investment
company whose executive offices are located at Two Portland Square, Portland,
Maine 04101. Proxies will be voted at the Special Meeting of Shareholders (the
"Meeting") of the Fund to be held at the offices of the Trust's administrator,
Forum Administrative Services, LLC ("Forum"), Two Portland Square, Portland,
Maine 04101 on Wednesday, April 28, 1999, at 10:00 a.m. (Eastern Standard Time),
and any adjournment thereof for the purposes set forth in the accompanying
Notice of Special Meeting of Shareholders. This Proxy Statement and the enclosed
notice of meeting and proxy card are first being mailed to shareholders on or
about April 2, 1999.
The Trust's Annual Report to shareholders for the fiscal year ended
June 30, 1998 and Semi-Annual Report to shareholders for the period ended
December 31, 1998, which include financial statements for the Fund, have
previously been mailed to shareholders receiving this Proxy Statement.
Shareholders may request a copy of the Annual Report and the Semi-Annual Report
without charge by calling the Fund's distributor, Forum Financial Services,
Inc., Two Portland Square, Portland, Maine 04101, at 1-888-CUTLER4.
The solicitation of proxies will be primarily by mail but may also
include telephone or oral communications by the officers of the Trust or by
regular employees of Cutler & Company, LLC (the "Adviser"), Forum or their
affiliates. The Adviser will bear all of the costs of the Meeting and the
preparation, printing and mailing of proxies. Forum will mail proxy materials
and tabulate voting results.
PURPOSE OF MEETING
The Meeting is being called:
(1) To approve or disapprove a proposal to modify the Fund's
investment objective and to effect corresponding revisions of the
Fund's investment policies;
(2) To approve or disapprove a proposal to modify the Fund's
fundamental investment policy regarding investment in the
securities of foreign issuers; and
(3) To transact such other business as may properly come before the
Meeting or any adjournment thereof.
DESCRIPTION OF VOTING
Approval of each proposal requires the affirmative vote of "a majority
of the outstanding voting securities" of the Fund as that term is defined under
the Investment Company Act of 1940 (the "1940 Act"). Under the 1940 Act, this
means the affirmative vote of the lesser of (a) 67% or more of the shares of the
Fund present at the Meeting or represented by proxy if the holders of more than
50% of the outstanding shares are present or represented by proxy at the Meeting
or (b) more than 50% of the outstanding shares of the Fund.
Shareholders of record at the close of business on March 15, 1999 (the
"Record Date") will be entitled to notice of, and to vote at, the Meeting,
including any adjournment thereof. As of the Record Date there were
2,146,362.277 shares of the Fund outstanding. As of the Record Date, no trustees
or officers of the Trust owned beneficially more than 1% of the outstanding
shares of the Fund. As of the Record Date, the following shareholder owned
beneficially more than 5% of the outstanding shares of the Fund:
- ------------------------------------------ --------------------------- -------------------- ---------------------
TITLE OF FUND NAME AND ADDRESS OF OWNER AMOUNT AND NATURE PERCENTAGE OF FUND
OF OWNERSHIP
- ------------------------------------------ --------------------------- -------------------- ---------------------
- ------------------------------------------ --------------------------- -------------------- ---------------------
Cutler Approved List Equity Fund Lorraine Y. Perrin 138,480.422 - 6.45
Testamentary Trust Beneficial
500 Eastgate Lane
Santa Barbara, CA 93108
- ------------------------------------------ --------------------------- -------------------- ---------------------
Each shareholder will be entitled to one vote for each whole share and
a fractional vote for each fractional share held. Shares may be voted in person
or by proxy. Shareholders holding one-third of the outstanding shares of the
Fund at the close of business on the Record Date present in person or by proxy
will constitute a quorum for the transaction of business regarding the Fund at
the Meeting. All properly executed proxies received in time to be voted at the
Meeting will be counted at the Meeting, and any adjournment thereof, in
accordance with the instructions marked thereon or otherwise provided therein.
For purposes of determining the presence of a quorum and counting votes
on the matters presented, shares represented by abstentions and "broker
non-votes" will be counted as present, but not as votes cast at the Meeting.
Broker non-votes are shares held in street name for which the broker indicates
that instructions have not been received from the beneficial owners and other
persons entitled to vote and for which the broker lacks discretionary voting
authority. Under the 1940 Act, the affirmative vote necessary to approve a
matter under consideration may be determined with reference to a percentage of
votes present at the Meeting. For this reason, abstentions and non-votes have
the effect of votes AGAINST the proposals. In completing proxies, therefore,
shareholders should be aware that checking the box labeled ABSTAIN will result
in the shares covered by the proxy being treated as if they were voted AGAINST
the proposals.
IF YOU DO NOT SPECIFY A CHOICE ON THE PROXY, PROPERLY EXECUTED PROXIES
THAT ARE RETURNED IN TIME TO BE VOTED AT THE MEETING WILL BE VOTED FOR THE
APPROVAL OF THE PROPOSALS DESCRIBED IN THIS PROXY STATEMENT. If a quorum is not
present at the Meeting, or if a quorum is present at the Meeting, but sufficient
votes to approve the proposals are not received, the persons named as proxies
may propose one or more adjournments of the Meeting to permit further
solicitation of proxies with respect to the proposals. In determining whether to
adjourn the Meeting, the following factors may be considered: the nature of the
proposals, the percentage of votes actually cast, the percentage of negative
votes actually cast, the nature of any further solicitation and the information
to be provided to shareholders with respect to the reasons for the solicitation.
Any adjournment will require the affirmative vote of a majority of shares
represented in person or by proxy at the Meeting. In that case, the persons
named as proxies will vote all proxies that they are entitled to vote FOR such
an adjournment; provided, however, any proxies required to be voted against the
proposals will be voted AGAINST such adjournment. A shareholder vote may be
taken on the proposals prior to adjournment if sufficient votes have been
received and it is otherwise appropriate.
Any shareholder may revoke his or her proxy at any time prior to
exercise thereof by giving written notice of revocation or by executing and
delivering a later dated proxy to Forum Shareholder Services, LLC, the Trust's
transfer agent, at Two Portland Square, Portland, Maine, 04101, or by personally
casting a vote at the Meeting.
PROPOSAL ONE
APPROVAL OR DISAPPROVAL OF A PROPOSAL TO MODIFY THE FUND'S
INVESTMENT OBJECTIVE AND TO EFFECT CORRESPONDING REVISIONS
OF THE FUND'S INVESTMENT POLICIES.
It is proposed that the Fund's investment objective be changed. The
Fund's current investment objective is to seek current income and long-term
capital appreciation by investing in at least 90% of the common stocks within
the Adviser's "Approved List". To qualify for the Approved List, each company
must meet the following five requirements.
(1) The Fund can only purchase companies listed on the New York Stock Exchange;
(2) The Fund can only purchase companies that paid dividends continuously for
at least 20 years, without any reduction in the rate;
(3) The Fund can only purchase companies that have commercial paper rated
Prime-1 and senior debt rated at least A by Moody's Investors Service, Inc.
or similarly rated by another rating agency, or if no ratings are
published, determined to be of similar quality by the Adviser;
(4) The Fund can only purchase companies with annual sales, assets and market
value of at least $1 billion; and
(5) The Fund can only purchase companies that in the Adviser's opinion have
wide ownership among major institutional investors and very liquid markets.
The Fund's investment objective, as modified, will be to "seek current
income and long-term capital appreciation". The Fund will seek to meet its
investment objective by investing in "value" stocks; that is, stocks whose
price/earnings ratios are lower relative to the market average. Accordingly, it
is proposed that the Fund no longer be required to invest in at least 90% of the
common stocks on the Approved List. In addition, the Fund will no longer be
required to invest 65% of its assets in the income producing equity securities
in the Approved List. If shareholders approve the revision of the Fund's
investment objective, the Fund will continue to only purchase companies with
annual sales, assets and market value of at least $1 billion and only purchase
companies that, in the Adviser's opinion, have wide ownership among major
institutional investors and very liquid markets. However, the Fund will now be
able to purchase companies that are listed on exchanges other than the New York
Stock Exchange. The Fund will no longer be required to purchase companies that
paid dividends continuously for at least 20 years, without any reduction in the
rate. It will now focus on dividend paying stocks and will attempt to maintain a
yield above the market average. And finally, the Fund will have no restrictions
with regard to debt rating and will therefore not be required to purchase only
companies that have commercial paper rated Prime-1 and senior debt rated at
least A by Moody's Investors Service, Inc. or similarly rated by another rating
agency.
As the proposed investment objective and corresponding policies of the Fund
would remove the requirement of investing in accord with the Approved List, it
would not be appropriate and accurate for the name of the Fund to retain the
"Approved List" reference. Therefore, the name of the Fund will be changed to
the "Cutler Value Fund" to reflect the new value style of investing.
The Board of Trustees believes that the proposed modification to the
Fund's investment objective and to effect corresponding revisions of the Fund's
investment policies are in the best interests of the Fund and its shareholders,
and recommends that shareholders vote for the proposal.
THE BOARD OF TRUSTEES RECOMMENDS THAT THE SHAREHOLDERS OF THE
FUND VOTE TO IN FAVOR OF THIS PROPOSAL
PROPOSAL TWO
APPROVAL OR DISAPPROVAL OF A PROPOSAL TO REMOVE THE FUND'S
FUNDAMENTAL INVESTMENT LIMITATION REGARDING FOREIGN INVESTMENTS.
This Proposal seeks shareholder approval of a change to the fundamental
investment limitation applicable to foreign investments. The Fund is currently
prohibited from investing in the securities of foreign issuers or purchasing
securities through a foreign market. The Fund currently desires to be able to
invest a portion of its assets in American Depositary Receipts ("ADRs"). An ADR
is a receipt of the share of a foreign-based corporation held in the vault of a
United States bank and entitles the shareholder to all dividends and capital
gains. It allows the investor to own shares of a foreign-based company without
having to purchase shares in an overseas market. Therefore, if the proposal is
approved, the Fund would be able to invest in the securities of a foreign issuer
via an ADR. Although the Fund has no current intention of investing directly in
the securities of foreign issuers or purchasing securities on a foreign market,
removal of this investment limitation will enable the Fund to make such
investments should it choose to do so in the future.
The Board of Trustees believes that the proposed modification to the
Fund's fundamental investment policy is in the best interests of the Fund and
its shareholders and recommends that shareholders vote for the proposal.
THE BOARD OF TRUSTEES RECOMMENDS THAT THE SHAREHOLDERS OF THE
FUND VOTE IN FAVOR OF THIS PROPOSAL.
OTHER BUSINESS
Management knows of no other business to be presented at the Meeting.
If any additional matters should be properly presented, it is intended that the
enclosed proxy will be voted in accordance with the judgment of the persons
named in the proxy.
ADDITIONAL INFORMATION
SUBMISSION OF SHAREHOLDER PROPOSALS.
It is anticipated that, following the Meeting, the Fund will not hold
any meetings of shareholders except as required by Federal or Delaware state
law. Shareholders wishing to submit proposals for inclusion in a proxy statement
for a subsequent shareholder meeting should send proposals within a reasonable
time before solicitation of proxies for such meeting to the Secretary of the
Trust, D. Blaine Riggle, in care of Forum Administrative Services, LLC, Two
Portland Square, Portland, Maine 04101. The timely submission of a proposal does
not guarantee its inclusion.
YOU ARE URGED TO FILL IN, DATE, SIGN AND RETURN THE ENCLOSED PROXY PROMPTLY
By Order of the Board of Trustees,
D. Blaine Riggle
Secretary
Preliminary Copies
THE CUTLER TRUST
Cutler Approved List Equity Fund
TWO PORTLAND SQUARE
PORTLAND, MAINE 04101
PROXY
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF TRUSTEES
Revoking any such prior appointments, the undersigned appoints D. Blaine Riggle
and David I. Goldstein (or, if only one shall act, that one) proxies with the
power of substitution to vote all of the shares of Cutler Approved List Equity
Fund (the "Fund"), a series of The Cutler Trust (the "Trust"), registered in the
name of the undersigned at the Special Meeting of Shareholders of the Fund to be
held at the offices of Forum Administrative Services, LLC, Two Portland Square,
Portland, Maine 04101, on April 28, 1999, at 10:00 a.m. (Eastern Standard Time),
and at any adjournment or adjournments thereof.
The shares of beneficial interest represented by this Proxy will be voted in
accordance with the instructions given by the undersigned below. IF NO
INSTRUCTIONS ARE GIVEN, SUCH SHARES WILL BE VOTED FOR THE PROPOSALS SET FORTH
BELOW. The Trust has proposed the Proposals. The Board of Trustees recommends
voting FOR the Proposals.
PROPOSAL ONE: To approve the modification of the Fund's investment
objective and to effect corresponding revisions of the Fund's
investment policies.
FOR _____ AGAINST _____ ABSTAIN _____
PROPOSAL TWO: To approve the removal of the Fund's fundamental
investment limitation regarding foreign investments.
FOR _____ AGAINST _____ ABSTAIN _____
The proxies are authorized to vote in their discretion on any other business
which may properly come before the meeting and ANY adjournments thereof.
(NOTE: Checking the boxes labeled ABSTAIN will result in the shares covered
by the Proxy being treated as if they were voted AGAINST the proposals.) Receipt
is acknowledged of the Notice and Proxy Statement for the Special Meeting of
Shareholders to be held on April 28, 1999. PLEASE SIGN AND DATE THIS PROXY IN
THE SPACE PROVIDED. Execution by shareholders who are not individuals must be
made by an authorized signatory. Executors, administrators, trustees, guardians
and others signing in a representative capacity should give their full title as
such.
______________________________________________ _________________
Authorized Signature Date
______________________________________________
Printed Name (and Title if Applicable)
______________________________________________ _________________
Authorized Signature (Joint Investor or Second Signatory) Date
______________________________________________
Printed Name (and Title if Applicable)