SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a)
OF THE SECURITIES EXCHANGE ACT OF 1934
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Rule 14a-6(e)(2))
[ ] Definitive Proxy Statement
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[ ] Soliciting Material Pursuant to Sec. 240.14a-11(c) or Sec. 240.14a-12
Calvert Social Investment Fund
Equity Portfolio
(Name of Registrant as Specified in Its Charter)
William M. Tartikoff, Esq.
Secretary
(Name of Person Filing Proxy Statement)
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[X] No fee required.
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previously. Identify previous filing by statement number, or the Form or
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<PAGE>
September __, 1998
Dear Shareholder:
I am writing to inform you of the upcoming special meeting of shareholders of
the Calvert Social Investment Fund Equity Portfolio and to request that you
take a few minutes to read the enclosed material and mail back the proxy
voting card.
You are being asked to vote on several important matters affecting the Equity
Portfolio. The Board of Trustees, including myself, believes these changes are
in the Equity Portfolio's and your best interest.
Each of these items is briefly discussed below, but is explained in greater
detail in the enclosed Proxy Statement:
Question 1 asks shareholders to approve a new investment advisory
agreement between the Equity Portfolio and the investment advisor,
Calvert Asset Management Company, Inc. (the "Advisor"). This
agreement is identical to the current investment advisory agreement
except that it does not provide for a performance adjustment to the fee.
Question 2 asks shareholders to approve a new investment subadvisory
agreement with the new investment subadvisor, Atlanta Capital
Management Company, L.L.C.. Otherwise, this agreement is identical to
the currenT investment subadvisory agreement in all material respects
except that it also reflects a different fee and does not provide for
a performance adjustment to the fee.
Question 3 asks shareholders to approve amended fundamental
investment restrictions to (a) change those that are no longer
required to be fundamental to non-fundamental operating policies,
and (b) revise the language of those that are still required to be
fundamental.
Question 4 asks shareholders to authorize the Fund and the Advisor
to enter into a new and/or amend an existing investment subadvisory
agreement in the future without having to obtain shareholder approval
first.
Regardless of the number of shares you own, it is important that you take the
time to read the enclosed proxy, and complete and mail your voting card as
soon as you can. A postage paid envelope is enclosed. If shareholders do not
return their proxies, the Equity Portfolio may have to incur the expense of
additional solicitations. All shareholders benefit from the speedy return of
proxies.
I appreciate the time you will take to review this important matter. If we
may be of any assistance, please call us at 1-800-368-2750.
Sincerely,
/s/ Barbara J. Krumsiek
Barbara J. Krumsiek
Trustee and Senior Vice President
<PAGE>
Calvert Social Investment Fund Equity Portfolio
4550 Montgomery Avenue, Suite 1000N
Bethesda, Maryland 20814
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
To be held on November __, 1998
NOTICE IS HEREBY GIVEN that the Special Meeting of Shareholders of the Calvert
Social Investment Fund Equity Portfolio will be held in the Tenth Floor
Conference Room of Calvert Group, Ltd., Air Rights North Tower, 4550
Montgomery Avenue, Suite 1000N, Bethesda, Maryland at 9:00 a.m. on [DAY,
November __, 1998] for the following purposes:
I. To approve a new investment advisory agreement with the investment
advisor, Calvert Asset Management Company, Inc., identical to the
current investment advisory agreement in all material respects, except
that it does notprovide for a performance adjustment to the fee.
II. To approve a new investment subadvisory agreement with the new
investment subadvisor, Atlanta Capital Management Company, L.L.C.,
otherwise identical to the current investment subadvisory agreement in
all material respects, except that it also reflects a different fee
and does not provide for a performance adjustment to the fee.
III. To approve amended fundamental investment restrictions to: (a) change
those that are no longer required to be fundamental to non-fundamental
operating policies and (b) revise the language of those that are still
required to be fundamental.
IV. To authorize Calvert Social Investment Fund and Calvert Asset Management
Company, Inc. to enter into a new and/or materially amending an existing
investment subadvisory agreement in the future without having to obtain
shareholder aproval first.
V. To transact any other business that may properly come before the Special
Meeting or any adjournment or adjournments thereof.
Shareholders of record at the close of business on September __, 1998 are
entitled to notice of and to vote at this Special Meeting or any adjournment
thereof.
By Order of the Trustees,
William M. Tartikoff, Esq.
Vice President and
Assistant Secretary
September __, 1998
Please execute the enclosed proxy and return it promptly in the enclosed
envelope, thus enabling the Equity Portfolio to avoid unnecessary expense and
delay. Your vote is extremely important, no matter how large or small your
holdings may be. No postage is required if mailed in the United States. The
proxy is revocable and will not affect your right to vote in person if you
attend the Special Meeting.
<PAGE>
IMPORTANT NOTICE TO CALVERT SOCIAL INVESTMENT FUND
EQUITY PORTFOLIO SHAREHOLDERS
QUESTIONS & ANSWERS
Please read the complete text of the enclosed Proxy Statement. For your
convenience, we have provided a brief overview of the matters to be voted
upon. Your vote is important. If you have any questions regarding the
proposal, please call us at 800-368-2745. We appreciate your investing with
Calvert Group, and look forward to a continuing relationship.
Q. Why am I receiving a proxy statement?
A. The primary reason is that the Calvert Social Investment Fund is
seeking your approval for the selection of a new subadvisor for the
Equity Portfolio.
Q. What does the selection of a new subadvisor entail ?
A. Changing the subadvisor will result in a change in the day-to-day
investment management of the Equity Portfolio. The selection of a new
subadvisor requires the execution of a new investment subadvisory
agreement. This new agreement is identical to the agreement with the
current subadvisor in all material respects, except that it has a
different base fee and it does not provide for a performance fee.
Similarly, a new investment advisory agreement is being proposed to
eliminate the performance fee payable to the investment advisor.
Q. How exactly do the proposed expense structure and advisory fees differ
from the current ones?
A. The same expense structure and fees would be in effect for the Equity
Portfolio except that the investment advisory fee would eliminate the
performance fee adjustment and the investment subadvisory fee (paid by
the Advisor, not the Equity Portfolio) would change from 0.25% of the
average daily net assets of the Equity Portfolio to 0.30% and would also
eliminate the performance fee adjustment of up to an additional 0.20%).
Q. Specifically why is the performance fee adjustment being eliminated?
A. After much consideration, Management has determined that performance
fees do not accomplish their goals of providing additional incentive for
performance. In fact, performance fees are generally not very popular in
the mutual fund arena. It is after coming to these realizations that
Management decided it may be best to eliminate the performance fee
adjustment and adopt a flat fee for compensating managers.
Q. Who is the new proposed fund manager?
A. The new proposed subadvisor is Atlanta Capital Management Company,
L.L.C., with principal offices at Two Midtown Plaza, Suite 1600, 1360
Peachtree Street, Atlanta, Georgia 30309. Atlanta Capital, founded in
1969, performs investment management services for various clients,
including pension, profit sharing and other employee benefit plans as
well as other mutual funds, institutions and individuals.
Q. How is this change anticipated to benefit shareholders?
A. The Board expects that the proposed change in subadvisor will allow the
Equity Portfolio to better seek to achieve its objective of growth
of capital.
Q. Will the selection of a new subadvisor change the existing relationship
between the Fund and its investment advisor, Calvert Asset Management
Co., Inc.?
A. The selection of a new subadvisor will not change the Fund's existing
relationship with the Advisor, nor the terms of the governing
investment advisory agreement, except that the Fund is proposing to
eliminate the performance fee, which requires a new investment advisory
agreement.
Q. Why are investment restrictions being amended?
A. The fundamental investment restrictions for the Equity Portfolio are
proposed to be amended because several of the restrictions are no longer
required to be fundamental restrictions due to changes in the regulatory
landscape. However, these restrictions are proposed to continue as
non-fundamental operating policies. Similarly, certain of these
investment restrictions are still required to be fundamental restrictions
and are being revised to more clearly state the applicable restriction.
These restrictions cannot be amended without shareholder approval, and
therefore, these proposed amendments are being submitted for your
approval.
Q. What if there are not enough votes to reach a quorum by the scheduled
special meeting date?
A. If enough shareholders do not vote, we will need to take further
action. We or our outside solicitors, D.F. King & Co., may contact you
by mail, telephone, facsimile, or by personal interview. Therefore, we
encourage you to vote as soon as you review the enclosed proxy
materials in order to avoid additional mailings, telephone calls or
other solicitations.
Q. How do the trustees of the Fund suggest that I vote?
A. After careful consideration, the Trustees of the Fund
unanimously recommend that you vote "FOR" each of the items proposed on
the enclosed proxy card.
Q. Will my vote make a difference?
A. Your vote is needed to ensure that the proposals can be acted upon.
Your immediate response on the enclosed proxy card will help save on
the costs of any further solicitations for a shareholder vote. We
encourage all shareholders to participate in the governance of the
Equity Portfolio.
Q. How do I vote my shares?
A. You can vote your shares by completing and signing the enclosed proxy
card, and mailing it in the enclosed postage paid envelope. You may
also vote by telephone, e-mail, our internet website, or in person. If
you need any assistance, or have any questions regarding the proposal
or how to vote your shares, please call us at (800) 368-2745.
Q. How do I sign the proxy card?
A. Proxy cards must be executed properly. When proxy cards are not
signed as required by law, you and the Fund must undertake the time and
expense to take steps to validate your vote. The following guide explains
the proper format for signing your proxy card:
1. Individual Accounts: Your name should be signed exactly as it
appears in the registration on the proxy card.
2. Joint Accounts: Either party may sign, but the name of the party
signing should conform exactly to a name shown in the registration.
3. All other accounts should show the capacity of the individual
signing. This can be shown either in the form of the account
registration itself or by the individual executing the proxy card.
Voting by mail is quick and easy. Everything you need is enclosed.
<PAGE>
Calvert Social Investment Fund
Equity Portfolio
4550 Montgomery Avenue, Suite 1000N
Bethesda, Maryland 20814
PROXY STATEMENT
September __, 1998
This statement is furnished in connection with the solicitation of proxies by
the Board of Trustees of the Calvert Social Investment Fund (the "Fund") to be
used at the Special Meeting of Shareholders of the Equity Portfolio. The
Special Meeting will be held in the Tenth Floor Conference Room of Calvert
Group, Ltd., Air Rights North Tower, 4550 Montgomery Avenue, Suite 1000N,
Bethesda, Maryland at 9:00 a.m. on [DAY, November __, 1998], or at such later
time or date made necessary by adjournment for the purpose set forth in the
Notice of Meeting.
The Equity Portfolio is a series of the Calvert Social Investment Fund, an
open-end management investment company that was organized as a Massachusetts
business trust on December 14, 1981.
Calvert Asset Management Company, Inc. (the "Advisor" or "CAMCO") serves as
investment advisor to the Fund and to several other registered investment
companies in the Calvert Group Family of Funds. Calvert Distributors, Inc.
("CDI") serves as the principal underwriter to the Fund. Calvert
Administrative Services Company ("CASC") has been retained by the Fund to
provide certain administrative services necessary to the conduct of its
affairs. CAMCO, CDI and CASC are located at 4550 Montgomery Avenue, Suite
1000N, Bethesda, Maryland, 20814, and are indirectly wholly owned subsidiaries
of Acacia Mutual Life Insurance Company.
By this proxy statement, the Fund seeks shareholder approval of new investment
advisory and subadvisory agreements which are identical to the current
agreements in all material respects, except that the proposed agreements do not
provide for performance fees and further, the proposed subadvisory agreement
provides for a higher fee to be paid by the Advisor for the subadvisor's
advisory services (but does not pay a fee for any marketing assistance).
The Fund also seeks shareholder approval of an arrangement approved by the
Securities and Exchange Commission whereby the Fund and the Advisor would be
allowed to enter into a new and/or materially amend an existing investment
subadvisory agreement in the future without shareholder approval. In addition,
the Fund seeks shareholder approval to amend the fundamental investment
restrictions applicable to the Equity Portfolio.
PROPOSALS
I. To approve a new investment advisory agreement with the investment
advisor, Calvert Asset Management Company, Inc., identical to the
current investment advisory agreement in all material respects, except that
it does not provide for a performance fee.
The Board of Trustees has approved, and recommends that shareholders approve,
a new investment advisory agreement between CAMCO and the Fund with respect to
the Equity Portfolio. The proposed Investment Advisory Agreement (the
"Advisory Agreement") is identical to the current investment advisory agreement
in all material respects, except that it eliminates the performance adjustment
of up to anadditional 0.20% provided under the current agreement.
The investment advisory agreement with CAMCO as it relates to the Equity
Portfolio was dated as of May 24, 1994. This agreement was last submitted to a
vote of shareholders, garnering approval of the current investment subadvisor,
on May 24, 1994. At the September 15, 1998 meeting of the Board of Trustees, the
Board determined that the Fund may benefit from the elimination of the
performance adjustment, and approved a new investment advisory agreement to
reflect this change to be entered into as of September 30, 1998.
Nonetheless, under the current investment advisory agreement, CAMCO
receives a fee from the Equity Portfolio based on a percentage of the Equity
Portfolio's average daily net assets plus or minus a performance adjustment.
During the fiscal year ended September 30, 1997, $683,046 in fees were paid to
CAMCO.
The Proposed Investment Advisory Agreement. The proposed Advisory Agreement
between the Equity Portfolio and CAMCO, reproduced in Appendix A, is under
substantially the same terms as govern the current arrangement with CAMCO,
except as described below. If approved by shareholders, the Advisory Agreement
will continue to January 1, 2000 unless terminated earlier by either party,
and will continue thereafter on an annual basis if approved by the Trustees or
shareholders and a majority of the Trustees who are not interested persons of
the Fund, Advisor or Subadvisor. Until shareholders approve the proposed
Advisory Agreement, the Equity Portfolio may compensate CAMCO pursuant to Rule
15a-4 under the Investment Company Act of 1940. However, compensation paid
during this interim period may not exceed the amount that would have been
payable to CAMCO under the prior arrangement.1 If shareholders do not
approve the proposed Investment Advisory Agreement at the upcoming Special
Meeting or any adjournment, the Board will meet, either in person or by
telephone, to consider re-instituting the performance adjustment.
Under the current advisory agreement, CAMCO is paid at the annual rate of 0.70%
of average daily net Assets, subject to adjustment, based on the extent to which
performance of the Equity Portfolio exceeded or trailed the Standard & Poor's
500 Composite Index:
Performance versus Performance
the S&P's 500 Composite Index Fee Adjustment
- --------------------------------------------------------------------------------
6% to < 12% 0.07%
12% to < 18% 0.14%
18% or more 0.20%
Comparison of Advisory Fees.
Current Investment Advisory Agreement Proposed Investment Advisory Agreement
________________________ __________________________
0.70% on all Portfolio assets 0.70% on all Portfolio assets
and a performance adjustment
of plus/minus 0.20%
Based on its evaluation of the materials presented and assisted by the
advice of independent counsel, the Board of Trustees concluded that the proposed
Advisory Agreement with CAMCO is in the best interest of the Equity Portfolio's
shareholders. The Board of Trustees has voted to approve the Advisory Agreement
and the submission of this agreement to shareholders . Accordingly, the Board of
Trustees recommends that shareholders vote FOR the proposed Advisory Agreement.
II. To approve a new investment subadvisory agreement with the investment
subadvisor, Atlanta Capital Management Company, L.L.C., otherwise
identical to the current investment subadvisory agreement in all material
respects, except that it reflects a different fee structure and does not
provide for a performance fee.
The Advisor has traditionally contracted out subadvisory services for the
Equity Portfolio. Pursuant to the current investment subadvisory agreement dated
as of February 1, 1994, the Equity Portfolio's investment subadvisor has been
Loomis, Sayles & Company, L.P. ("Loomis, Sayles"),organized as a limited
partnership and controlled by New England Mutual Life Insurance Company. The
principal business address of Loomis, Sayles is One Financial Center, Boston,
Massachusetts 02111.
Under this
agreement, Loomis, Sayles receives a fee from the Advisor based on a
percentage of the Equity Portfolio's average daily net assets plus or minus a
performance adjustment. During fiscal year ended September 30, 1997, $182,267
in subadvisory fees were paid to Loomis, Sayles by CAMCO.
At the September 15, 1998 meeting of the Board of Trustees, the Board
terminated Loomis, Sayles as the subadvisor to the Equity Portfolio effective
as of September 30, 1998. In this connection, the Board determined that
shareholders may benefit from the services of a different investment
subadvisor whose management style might better achieve the Equity Portfolio's
objective of growth of capital. After careful consideration by the Advisor of
the many candidates, the Advisor recommended, and the Board selected (subject
to shareholder approval), Atlanta Capital Management Company, L.L.C. ("Atlanta
Capital") as subadvisor for the Equity Portfolio. Therefore, Atlanta Capital
will assume management responsibility for the Equity Portfolio as of September
30, 1998.
In order to make its decision, the Board, via Management, requested
information about Atlanta Capital, as well as further information about
Management's evaluation of other potential subadvisors. Management and the Board
subsequently received and evaluated the supplied information. This information
included details about the firm in general and copies of regulatory disclosure
materials filed with the Securities and Exchange Commission. Management met with
Atlanta Capital, and Atlanta Capital made a presentation to the Board and
responded to members' questions at the Board meeting.
Atlanta Capital Management, L.L.C. Atlanta Capital was founded in 1969 and is
owned and operated by six partners. Atlanta Capital is located at Two Midtown
Plaza, Suite 1600, 1360 Peachtree Street, Atlanta, Georgia 30309. As of
August 31, 1998, Atlanta Capital had approximately 3.5 billion in assets under
management. The firm performs investment management services for various
clients, including pension, profit sharing and other employee benefit plans as
well as other mutual funds, institutions and individuals.
Atlanta Capital currently provides investment subadvisory services to one other
mutual fund with an investment objective similar to that of the Equity
Portfolio:
Mutual Fund Assets Under Management Management Fees
PB Series Trust,
High Quality Stock Fund $11.0 million] 0.50% of net
assets
With respect to this mutual fund, Atlanta Capital has not waived,
reduced, or otherwise agreed to reduce its compensation under its
investment management contract.
Atlanta Capital's Investment Professionals.
Daniel W. Boone, III, CFA is a Senior Partner of Atlanta Capital. Mr.
Boone's primary responsibilities are in equity portfolio management and
research. Before joining Atlanta Capital in 1976, he was with the
international firm of Lazard Freres in New York. Prior to that he was an
analyst with the Wellington Management Company. Mr. Boone has earned an MBA
from the Wharton School of The University of Pennsylvania, where he graduated
with distinction, and a B.A. from Davidson College. He is a Chartered Financial
Analyst and a Chartered Investment Counselor. Mr. Boone is a past president
of the Atlanta Society of Financial Analysts.
William R. Hackney, III, CFA is Managing Partner of Atlanta Capital. Mr.
Hackney joined Atlanta Capital in 1995 and has responsibilities in equity
portfolio management and research as well as day-to-day administration. Prior
to joining Atlanta Capital, he was Senior Vice President and Chief Investment
Officer of First Union Corporation's Capital Management Group. Mr. Hackney
has earned an MBA from The Citadel and a B.A. from The University of North
Carolina at Chapel Hill.
Marilyn Robinson, CFA is Senior Vice President and Principal, serves as
Director of Equity Research and is a member of the Portfolio Management team .
Ms. Robinson has 15 years investment experience, nine years with Atlanta
Capital. Prior to joining Atlanta Capital, she was a Treasury Analyst for
Consolidated Health Care in Richmond, Virginia. Ms. Robinson has earned a M.S.
and B.B.A. from Georgia State University. She is a Chartered Financial Analyst
and serves on the Board of Examiners for the Association of Investment
Management and Research. She is also a Certified Cash Manager.
Atlanta Capital's Investment Strategy.
Atlanta Capital is a large-cap, high quality growth stock manager. The firm
favors companies with superior, consistent growth in earnings and dividends,
and therefore limits holdings to stocks rated B+ or better by Standard and
Poor's Corporation.
Atlanta Capital's Partners.
Name of Company and Principal
Name Principal Business Address Occupation
or Title
Daniel W. Boone, III Atlanta Capital Management Company Senior Partner
Two Midtown Plaza, Suite 1600
1360 Peachtree Street
Atlanta, Georgia 30309
Gregory L. Coleman Atlanta Capital Management Company Partner
Two Midtown Plaza, Suite 1600
1360 Peachtree Street
Atlanta, Georgia 30309
Jerry D. DeVore Atlanta Capital Management Company Partner
Two Midtown Plaza, Suite 1600
1360 Peachtree Street
Atlanta, Georgia 30309
William R. Hackney, III Atlanta Capital Management Company Managing Partner
Two Midtown Plaza, Suite 1600
1360 Peachtree Street
Atlanta, Georgia 30309
Dallas Lundy Atlanta Capital Management Company Partner
Two Midtown Plaza, Suite 1600
1360 Peachtree Street
Atlanta, Georgia 30309
Walter F. Reames, Jr. Atlanta Capital Management Company Senior Partner
Two Midtown Plaza, Suite 1600
1360 Peachtree Street
Atlanta, Georgia 30309
The Proposed Investment Subadvisory Agreement. The proposed Investment
Subadvisory Agreement (the "Subadvisory Agreement") between the Advisor and
Atlanta Capital, reproduced in Appendix B, contains substantially the same terms
as govern the Advisor's arrangement with Loomis, Sayles, except as described
below. If approved by shareholders, the Subadvisory Agreement will continue to
January 1, 2000 unless terminated earlier by either party, and will continue
thereafter on an annual basis if approved by the Trustees or shareholders and a
majority of the Trustees who are not interested persons of the Fund, Advisor or
Subadvisor. Until shareholders approve the proposed Subadvisory Agreement, CAMCO
may compensate Atlanta Capital pursuant to Rule 15a-4 under the Investment
Company Act of 1940. However, compensation paid during this interim period may
not exceed the amount that would have been payable to Loomis, Sayles under the
prior arrangement.2 If shareholders do not approve the proposed Subadvisory
Agreement at the upcoming Special Meeting or any adjournment, the Board will
meet, either in person or by telephone, to consider what action to take,
including but not limited to, seeking the services of an alternate investment
subadvisor.
As with the arrangement between the Advisor and Loomis, Sayles, Atlanta
Capital's fee for subadvisory services will be paid by the Advisor. However,
whereas the Advisor paid Loomis, Sayles an annual fee based upon the Equity
Portfolio's average daily net assets plus or minus a performance adjustment,
the Advisor will pay Atlanta Capital a fee with no performance adjustment.
Specifically, the proposed fee schedule appended to the proposed Subadvisory
Agreement with Atlanta Capital calls for a fee, payable monthly, at the annual
rate of 0.30% of the Equity Portfolio's average daily net assets.
Under the current arrangement, Loomis, Sayles is paid a subadvisory fee at the
annual rate of 0.25% of average daily net assets and the Advisor could adjust
this fee based on the extent to which performance of the Equity Portfolio
exceeded or trailed the Standard & Poor's 500 Composite Index:
Performance versus Performance
the Relevant Index Fee Adjustment
- --------------------------------------------------------------------------------
6% to < 12% 0.07%
12% to < 18% 0.14%
18% or more 0.20%
Comparison of Subadvisory Fees.
Current Investment Subadvisory Proposed Investment
Agreement with Loomis, Subadvisory Agreement with
Sayles & Company, L.P. Atlanta Capital
Management Company, L.L.C.
________________________ _________________________
0.25% on all Portfolio assets 0.30% on all Portfolio assets.
and a performance adjustment
of plus/minus 0.20%*
*Loomis, Sayles also received a 0.05% annual fee, paid by CAMCO, for its
assistance with the distribution of the Equity Portfolio. Atlanta Capital will
not receive such a fee.
Based on its evaluation of the materials presented and assisted by the
advice of independent counsel, the Board of Trustees concluded that the proposed
Subadvisory Agreement with Atlanta Capital is in the best interest of the Equity
Portfolio's shareholders in that they will benefit from the services of a
different investment subadvisor whose management style might better achieve the
Equity Portfolio's objective of growth of capital. The Board of Trustees has
voted to approve the Investment Subadvisory Agreement and the submission of this
agreement to shareholders. Accordingly, the Board of Trustees recommends that
shareholders vote FOR the proposed Subadvisory Agreement.
III. To approve amended fundamental investment restrictions to: (a) change
those that are no longer required to be fundamental to non-fundamental operating
policies and (b) revise the language of those that are still required to be
fundamental.
Since the inception of the Calvert Social Investment Fund Equity Portfolio
in 1994, certain state laws and/or regulations are no longer applicable, leaving
the Equity Portfolio governed by investment policies and restrictions that are
more restrictive than is currently necessary. Accordingly, Management has taken
the opportunity to provide additional flexibility in the management of the
Equity Portfolio and has thus recommended to the Board that the investment
policies and restrictions of the Equity Portfolio be amended . This is expected
to enhance the subadvisor's ability to manage the Equity Portfolio in a changing
investment environment and will increase investment management opportunities.
The fundamental investment restrictions of the Equity Portfolio, as they
read now, are reproduced in Appendix C. After careful consideration, and upon
the advice of outside counsel, the Board approved changing the following
fundamental investment restrictions to non-fundamental operating policies of the
Equity Portfolio, subject to shareholder approval:
1. Purchase securities of any issuer (other than obligations of, or
guaranteed by, the United States Government, its agencies or instrumentalities)
if, as a result, more than 5% the value of that Portfolio's total assets would
be invested in securities of that issuer. [PRIOR FUNDAMENTAL RESTRICTION #1]
2. Purchase more than 10% of the outstanding voting securities of any
issuer. In addition, the Fund may not in the aggregate purchase more than 10% of
the outstanding voting securities of any issuer. [PRIOR FUNDAMENTAL RESTRICTION
#3]
3. Purchase the securities of any issuer with less than three years'
continuous operation if, as a result, more than 5% of the value of that
Portfolio's total assets would be invested in securities of such issuers. [PRIOR
FUNDAMENTAL RESTRICTION #4]
4. Purchase from or sell to any of the Fund's officers or Trustees, or
firms of which any of them are members, any securities (other than capital stock
of the Fund), but such persons or firms may act as brokers for the Fund for
customary commissions. [PRIOR FUNDAMENTAL RESTRICTION #7]
5. Make short sales of securities or purchase any securities on margin
except with respect to options, futures contracts and options on futures
contracts. [PRIOR FUNDAMENTAL RESTRICTION #9]
6. Write, purchase or sell puts, calls or combinations thereof except with
respect to options, futures contracts and options on futures contracts. [PRIOR
FUNDAMENTAL RESTRICTION #10]
7. Invest for the purpose of exercising control or management of another
issuer. [PRIOR FUNDAMENTAL RESTRICTION #11]
8. Invest in interests in oil, gas, or other mineral exploration or
development programs, although it may invest in securities of issuers which
invest in or sponsor such programs. [PRIOR FUNDAMENTAL RESTRICTION #13]
9. Purchase or retain securities issued by investment companies except to
the extent permitted by the investment Company Act of 1940, as amended, and in
connection with a trustee's/director's deferred compensation plan. [PRIOR
FUNDAMENTAL RESTRICTION #14]
Further, after careful consideration, and upon the advice of outside
counsel, the Board approved revising the language of the remaining fundamental
investment restrictions, subject to shareholder approval:
Proposed Revised Fundamental Investment Restrictions.
The Equity Portfolio may not:
1. Borrow money, except from banks for temporary or emergency
purposes, and then only in an amount not to exceed one-third of
the Fund's total assets, or as permitted by law. The Fund will
not make purchases while its borrowings exceed 5% of total
assets. In order to secure any permitted borrowings under this
section, the Fund may pledge, mortgage or hypothecate its assets.
2. Issue senior securities or underwrite the securities of other
issuers, except as permitted by the Board of Trustees within
applicable law, and except to the extent that in connection with
the disposition of its portfolio securities, the Fund may be
deemed to be an underwriter.
3. Concentrate more than 25% of the value of its assets in any one
industry; provided, however, that there is no limitation with
respect to investments in obligations issued or guaranteed by
the United States Government or its agencies and
instrumentalities, and repurchase agreements secured thereby.
4. Invest directly in commodities, commodity futures contracts, or
real estate. (The Fund may invest in securities which are
secured by real estate or real estate mortgages, or in the
securities of issuers which invest or deal in commodities,
commodity futures, real estate, or real estate mortgages and may purchase
or sell stock index futures, foreign currency futures, interest rate
futures and options thereon.)
5. Make loans of more than one-third of the total assets of the Fund, or as
permitted by law, other than through the purchase of money market
instruments and repurchase agreements or by the purchase of bonds,
debentures or other debt securities, or the lending of portfolio
securities as detailed in the Prospectus, or as permitted by law. The
purchase by the Fund of all or a portion of an issue of publicly or
privately distributed debt obligations in accordance with its investment
objective, policies and restrictions, shall not constitute the making of
a loan.
The Board of Trustees has voted to approve these amended fundamental
investment restrictions for the Equity Portfolio and recommends that
shareholders vote FOR the Proposal.
IV. To authorize the Fund and the Advisor entering into a new and/or
materially amending an existing investment subadvisory agreement in
the future without shareholder approval.
The Securities and Exchange Commission has issued to the Fund an order
permitting the Fund to enter into a new and/or materially amend an investment
subadvisory agreement without shareholder approval with respect to the Equity
Portfolio. Management believes that the Advisor's constant supervision of the
subadvisor will permit the proportion of shareholders' assets subject to
particular subadvisor styles to be reallocated (or a new subadvisor introduced)
in response to changing market conditions or subadvisor performance, in an
attempt to improve the Equity Portfolio's overall performance. In essence,
shareholder approval of this proposal would permit the Advisor to select the
subadvisor best suited to achieve the Equity Portfolio's investment objective.
However, the Fund may not rely on the order until it has been authorized by the
Portfolio's shareholders to do so.
In the past, Management has found that requiring shareholder approval of a
subadvisor and investment subadvisory agreement imposed costs on the Equity
Portfolio without advancing shareholder interests. Management believes that
shareholders' interests are adequately protected by their voting rights with
respect to the investment advisory agreement and the responsibilities assumed
by the Advisor and the Fund's Board of Trustees. Further, Management
notes that it has become increasingly difficult to obtain shareholder
quorums for shareholder meetings. Without shareholder approval of this
proposal, Management believes that the Equity Portfolio, in the future, could be
left with an ineffective subadvisor while awaiting shareholder approval.
Management is also concerned that requiring shareholder approval of a new
subadvisor and/or amendments to an existing investment subadvisory agreement
would prevent the Fund from promptly and timely employing the subadvisor best
suited to the needs of the Equity Portfolio.
In requesting you to authorize the Advisor and the Fund to enter into a new
or amend an existing investment subadvisory agreement with a new subadvisor
and/or amend an existing investment subadvisory agreement without first seeking
shareholder approval, Management is seeking to streamline the steps in the
process so that the Fund can more efficiently continue toward achieving
its investment objectives with a subadvisor recommended by the Advisor and
approved by the Board of Trustees. Management expects that the Equity Portfolio
and its shareholders will benefit from elimination of the cost and delay
associated with the proxy process and the conducting of special shareholder
meetings. If the Advisor and the Fund are authorized to enter into new
subadvisory relationships outside of the proxy solicitation process,
shareholders will continue to benefit by knowing that the Advisor has applied
the same safeguards and criteria in making its selection while still fulfilling
its same duties to shareholders and to the Equity Portfolio. Although Management
would be authorized to make a subadvisory change without a shareholder vote, as
shareholders, you are entitled to and would continue to receive the same
disclosure and details about the selection process and the background of the
newly selected manager as you have received in this solicitation, but in the
form of an information statement instead of a proxy statement. This information
would be delivered to shareholders within 90 days of the subadvisory change.
The Information Statement would include the same information about the new
subadvisor and the new investment subadvisory agreement as would be included in
a proxy statement. In addition, the Prospectus and Statement of Additional
Information would be revised to disclose all required information regarding the
subadvisor. It would include any change in such disclosure caused by the
addition of a new subadvisor and any proposed material change in the investment
subadvisory agreement of the Fund.
Management recommended authorization of the ability to enter into a new
and/or materially amend an existing investment subadvisory agreement without
shareholder approval to the Board of Trustees, and at a meeting of the Board of
Trustees held on September 15, 1998, the Board approved Management's
recommendation. For the reasons outlined above, the Board of Trustees voted to
approve the submission of the proposal to shareholders of the Equity Portfolio
and recommends that shareholders vote FOR the Proposal.
OTHER BUSINESS
The Trustees of the Fund do not intend to present any other business at the
meeting. If, however, any other matters are properly brought before the
meeting, the persons named in the accompanying form of proxy will vote thereon
in accordance with their judgment.
ANNUAL REPORTS
The audited Annual Report to Shareholders of the Fund is also incorporated
by reference into this proxy statement. Copies of the most recent Annual Report
and the most recent semi-annual report succeeding the annual report may be
obtained without charge by writing to the Fund at 4550 Montgomery Avenue, Suite
1000N, Bethesda, Maryland 20814 or by calling (800) 368-2745.
SHAREHOLDER PROPOSALS
The Fund is not required to hold annual shareholder meetings. Shareholders
who would like to submit proposals for consideration at future shareholder
meetings should send written proposals to the Calvert Group Legal Department,
4550 Montgomery Avenue, Suite 1000N, Bethesda, Maryland, 20814.
VOTING INFORMATION
Proxies are solicited by mail, but additional solicitations may be made by
telephone, computer communications, facsimile or other such means, or by
personal contact by officers or employees of Calvert Group and its affiliates
or by proxy soliciting firms retained for this purpose. The Fund will bear
solicitation costs.
A proxy may be revoked at any time before the meeting or during the meeting by
oral or written notice to William M. Tartikoff, Esq., 4550 Montgomery Avenue,
Suite 1000N, Bethesda, Maryland 20814. Unless revoked, all valid proxies will
be voted in accordance with the specification thereon or, in the absence of
specification, for approval of the proposals.
Each proposal must be approved by a majority of the outstanding shares,
which is defined as the lesser of: (1) the vote of 67% or more of the shares of
the Portfolio at the Special Meeting if the holders of more than 50% of the
outstanding shares of the Portfolio are present in person or by proxy, or (2)
the vote of more than 50% of the outstanding shares of the Portfolio. All
classes of the Portfolio vote together.
Abstentions and broker non-votes will be counted as shares present for
purposes of determining whether a quorum is present but will not be voted for
or against any adjournment or proposal. (Broker non-votes are shares held in
street name for which the broker indicates that instructions have not been
received from the beneficial owners or other persons entitled to vote and the
broker does not have discretionary voting authority.) Accordingly, abstentions
and broker non-votes effectively will be a vote against adjournment or against
any proposal where the required vote is a percentage of the shares present.
Shareholders of the Equity Portfolio of record at the close of business on
September __, 1998 ("record date") are entitled to notice of and to vote at
the Special Meeting or any adjournment thereof. Shareholders are entitled to
one vote for each share held on that date. As of August 31, 1998, as shown on
the books of the Equity Portfolio, there were issued and outstanding [#]
shares of the Equity Portfolio. As of that date, the officers and Trustees of
the Equity Portfolio as a group beneficially owned less than 1% of the
outstanding shares of the Equity Portfolio. To the knowledge of the Fund, no
shareholder owned beneficially more than 5% of the outstanding shares of the
Equity Portfolio on that date.
This Proxy Statement is expected to be mailed to shareholders of record on or
about September __, 1998.
ADJOURNMENT
In the event that sufficient votes in favor of the proposals set forth in the
Notice of Meeting and Proxy Statement are not received by the time scheduled
for the meeting, the persons named as proxies may move one or more
adjournments of the meeting to permit further solicitation of proxies with
respect to any such proposals. Any such adjournment will require the
affirmative vote of a majority of the shares present at the meeting. The
persons named as proxies will vote in favor of such adjournment those shares
that they are entitled to vote which have voted in favor of such proposals.
They will vote against any such adjournment those proxies that have voted
against any such proposals.
By Order of the Board of Trustees
William M. Tartikoff, Esq.
Vice President and Assistant Secretary
The Trustees of Calvert Social Investment Fund Equity Portfolio, including the
Independent Trustees, recommend a Vote for Approval of the Proposals presented.
<PAGE>
CALVERT SOCIAL INVESTMENT FUND EQUITY PORTFOLIO
THIS PROXY IS SOLICITED BY THE BOARD OF TRUSTEES
The undersigned, revoking previous proxies, hereby appoint(s) William M.
Tartikoff, Esq. and Barbara J. Krumsiek, attorneys, with full power of
substitution, to vote all shares of the Equity Portfolio that the undersigned
is entitled to vote at the Special Meeting of Shareholders to be held in the
Tenth Floor Conference Room of Calvert Group, 4550 Montgomery Avenue, Suite
1000N, Bethesda, Maryland 20814 on [DAY, November __, 1998] at 9:00 a.m. and
at any adjournment thereof. All powers may be exercised by a majority of the
proxy holders or substitutes voting or acting or, if only one votes and acts,
then by that one. This Proxy shall be voted on the proposals described in the
Proxy Statement. Receipt of the Notice of the Meeting and the accompanying
Proxy Statement is hereby acknowledged.
NOTE: Please sign exactly as
your name appears on this
Proxy. When signing in a
fiduciary capacity, such as
executor, administrator,
trustee, guardian, etc.,
please so indicate.
Corporate and partnership
proxies should be signed by
an authorized person
indicating the person's
title.
Date: ________________________, 1998
__________________________________
__________________________________
Signature(s) (Title(s), if applicable)
PLEASE SIGN, DATE, AND RETURN
PROMPTLY IN ENCLOSED ENVELOPE
- --------------------------------------------------------------------------
Please refer to the Proxy Statement discussion on this matter.
IF NO SPECIFICATION IS MADE, THE PROXY SHALL BE VOTED FOR THE PROPOSALS.
As to any other matter, said attorneys shall vote in accordance with their
best judgment.
THE BOARD OF TRUSTEES RECOMMENDS A VOTE FOR THE FOLLOWING:
1. To approve a new investment advisory agreement with the investment
advisor, Calvert Asset Management Company, Inc., identical to the
current investment advisory agreement in all material respects, except
that it does not provide for a performance adjustment to the fee.
[ ] For [ ] Against [ ] Abstain
2. To approve a new investment subadvisory agreement with the
investment subadvisor, Atlanta Capital Management Company, L.L.C.,
otherwise identical to the current investment subadvisory agreement in
all material respects, except that it also reflects a new fee and does
not provide for a performance adjustment to the fee.
[ ] For [ ] Against [ ] Abstain
3. To approve amended fundamental investment restrictions to:
(a) Change those that are no longer required to be fundamental
to non-fundamental operating policies.
[ ] For [ ] Against [ ] Abstain
(b) Revise the language of those that are still required to be fundamental.
[ ] For [ ] Against [ ] Abstain
4 To authorize the Fund and the Advisor to enter into a new and/or
materially amend an existing investment subadvisory agreement in the
future without having to obtain shareholder approval first.
[ ] For [ ] Against [ ] Abstain
[INSERT INSTRUCTIONS FOR FACSIMILE, TELEPHONE AND INTERNET VOTING]
<PAGE>
APPENDIX A
PROPOSED INVESTMENT ADVISORY AGREEMENT
INVESTMENT ADVISORY AGREEMENT, made this __ day of September, 1998,
by and between CALVERT ASSET MANAGEMENT COMPANY, INC., a Delaware corporation
having its principal place of business in Bethesda, Maryland (the "Advisor"),
and CALVERT SOCIAL INVESTMENT FUND, a Massachusetts business trust created
pursuant to a Declaration of Trust filed with the Secretary of State of the
Commonwealth of Massachusetts (the "Trust").
WHEREAS, the Trust is registered as an open-end investment company
under the Investment Company Act of 1940, as amended (the "1940 Act"), for the
purpose of investing and reinvesting its assets in securities, as set forth in
its Declaration of Trust, its By-laws and its registration statements under
the 1940 Act and the Securities Act of 1933 as amended (the "1933 Act"), the
Trust has registered separate series of shares of beneficial interest for sale
to the public; and the Trust desires to avail itself of the services,
information, advice, assistance and facilities of an investment advisor and to
have an investment advisor perform for it various investment advisory and
research services, and other management services; and
WHEREAS, the Advisor is an investment advisor registered under the
Investment Advisers Act of 1940, as amended, and is engaged in the business of
rendering management and investment advisory services to investment companies
and desires to provide such services to the Trust;
NOW, THEREFORE in consideration of the terms and conditions
hereinafter set forth, it is agreed as follows:
1. Employment of the Advisor. The Trust hereby employs the
Advisor to manage the investment and reinvestment of the assets of those
separate series of the Trust specified in the Schedule attached
hereto and made a part of this Agreement (each a "Fund"), subject to the
control and direction of the Trust's Board of Trustees, for the period and on
the terms hereinafter set forth. The Advisor hereby accepts such employment
and agrees during such period to render the services and to assume the
obligations herein set forth for the compensation herein provided. The
Advisor shall for all purposes herein be deemed to be an independent
contractor and shall, except as expressly provided or authorized (whether
herein or otherwise), have no authority to act for or represent the Trust in
any way or otherwise be deemed an agent of the Trust.
2. Obligations of and Services to be Provided by the Advisor.
The Advisor undertakes to provide the following services and to assume the
following obligations:
a. The Advisor shall manage the investment and
reinvestment of each Fund's assets, subject to and
in accordance with the investment objectives and
policies of the Fund, and the social investment
criteria, as stated in the then current prospectus
and statement of additional information for the Fund
and any directions which the Trust's Board of
Trustees may issue from time to time. In pursuance
of the foregoing, the Advisor shall make all
determinations with respect to the investment of
each Fund's assets and the purchase and sale of
portfolio securities and shall take such steps as
may be necessary to implement the same. Such
determination and services shall also include
determining the manner in which voting rights,
rights to consent to corporate action, any other
rights pertaining to a Fund's portfolio securities
shall be exercised. The Advisor shall render
regular reports to the Trust's Board of Trustees
concerning each Fund's investment activities.
b. The Advisor shall, in the name of the Trust on
behalf of each Fund, place orders for the execution
of the Fund's portfolio transactions in accordance
with the policies with respect thereto set forth in
the Trust's registration statement under the 1940
Act and the 1933 Act, as applicable to the Fund as
such registration statement may be amended from time
to time. In connection with the placement of orders
for the execution of each Fund's portfolio
transactions, the Advisor shall create and maintain
all necessary brokerage records of the Fund in
accordance with all applicable laws, rules and
regulations, including but not limited to records
required by Section 31(a) of the 1940 Act. All
records shall be the property of the Trust and shall
be available for inspection and use by the
Securities and Exchange Commission (the "SEC"), the
Trust or any person retained by the Trust. Where
applicable, such records shall be maintained by the
Advisor for the periods and the places required by
Rule 31a-2 under the 1940 Act.
c. The Advisor shall bear its expenses of providing
services to the Trust and each Fund pursuant to this
Agreement except such expenses as are undertaken by
the Trust or the Fund. In addition, the Advisor
shall pay the salaries and fees of all Trustees, and
executive officers who are employees of the Advisor
or its affiliates ("Advisor Employees").
d. In providing the services and assuming the obligations
set forth herein, the Advisor may, at its expense,
employ one or more Subadvisors. References herein to the
Advisor shall include any Subadvisor employed by the
Advisor. Any agreement between the Advisor and a
Subadvisor shall be subject to the Renewal, Termination
and Amendment provisions of paragraph 10 hereof.
e. The Advisor is responsible for screening investments to
determine that they meet the Fund's social investment
criteria, as may be amended from time to time by the
Trustees.
3. Expenses of each Fund. Each Fund shall pay all expenses
other than those expressly assumed by the Advisor. Expenses payable by the
Fund shall include, but are not limited to:
a. Fees to the Advisor as provided herein:
b. Legal and audit expenses;
c. Fees and expenses related to the registration and
qualification of the Fund and its shares for
distribution under federal and state securities
laws;
d. Expenses of the administrative service agent,
transfer agent, registrar, custodian, dividend
disbursing agent and shareholder servicing agent;
e. Salaries, fees and expenses of Trustees and
executive officers of the Trust, other than Advisor
Employees;
f. Taxes and corporate fees levied against the Fund;
g. Brokerage commissions and other expenses associated
with the purchase and sale of portfolio securities
for the Fund;
h. Expenses, including interest, of borrowing money;
i. Expenses incidental to meetings of the Fund's
shareholders and the Fund's allocable portion of
the expenses incidental to the maintenance of the
Trust's organizational existence;
j. Expenses of printing stock certificates
representing shares of the Fund and expenses of
preparing, printing and mailing notices, proxy
material, reports to regulatory bodies and reports
to shareholders of the Fund;
k. Expenses of preparing and typesetting of
prospectuses of the Fund;
l. Expenses of printing and distributing prospectuses
to shareholders of the Fund;
m. The Fund's allocable portion of association
membership dues of the Trust;
n. Insurance premiums for fidelity and other coverage;
and
o. Distribution Plan expenses, as permitted by Rule
12b-1 under the 1940 Act and as authorized by the
Trustees.
4. Compensation of Advisor
a. As compensation for the services rendered and
obligations assumed hereunder by the Advisor, the
Trust, on behalf of each Fund, shall pay to the
Advisor advisory fees as specified in one or more
Schedules attached hereto and made part of this
Agreement. Such fees shall be payable within ten
(10) days after the last day of each calendar
month. Upon termination of this Agreement before
the end of any calendar month, the fee for such
period shall be prorated in the manner set forth in
one or more attached Schedules. The Schedules may
be amended from time to time, provided that
amendments thereto are made in conformity with
applicable laws and regulations and the
Declaration of Trust and By-laws of the Trust. Any
amendment to a Schedule pertaining to any new or
existing Fund shall not be deemed to affect the
interest of any other Fund and shall not require
the approval of the shareholders of any other Fund.
b. The Advisor reserves the right (i) to waive all or
part of its fee and assume expenses of the Fund
and (ii) to make payments to brokers and dealers in
consideration of their promotional or
administrative services.
5. Activities of the Advisor. The services of the Advisor to
the Trust and each Fund hereunder are not to be deemed exclusive, and the
Advisor shall be free to render similar services to others. It is understood
that Trustees and officers of the Trust are or may become interested in the
Advisor as stockholders, officers, or otherwise , and that stockholders and
officers of the Advisor are or may become similarly interested in the Trust,
and that the Advisor may become interested in the Trust as shareholder or
otherwise.
6. Use of Names. The Trust or any Fund shall not use the name
of the Advisor in any prospectus, sales literature or other material relating
to the Trust in any manner not approved prior thereto by the Advisor;
provided, however, that the Advisor shall approve all uses of its name which
merely refer in accurate terms to its appointment hereunder or which are
required by the SEC or a State Securities Commission; and, provided, further,
that in no event shall such approval be unreasonably withheld. The Advisor
shall not use the name of the Trust or any Fund in any material relating to
the Advisor in any manner not approved prior thereto by the Trust; provided,
however, that the Trust shall approve all uses of its name which merely refer
in accurate terms to the appointment of the Advisor hereunder or which are
required by the SEC or a State Securities Commission; and, provide, further,
that in no event shall such approval be unreasonably withheld.
The Trustees of the Trust acknowledge that, in consideration of the
Advisor's assumption of certain expenses of formation of the Trust, the
Advisor has reserved for itself the rights to the name "Calvert Social
Investment Fund" (or any similar name) and that use by the Trust of such name
shall continue only with the continuing consent of the Advisor, which consent
may be withdrawn at any time, effective immediately, upon written notice
thereof to the Trust.
7. Liability of the Advisor. Absent willful misfeasance, bad
faith, gross negligence, or reckless disregard of obligations or duties
hereunder on the part of the Advisor, the Advisor shall not be subject to
liability to the Trust or to any shareholder of the Trust for any act or
omission in the course of, or connected with, rendering services hereunder or
for any losses that may be sustained in the purchase, holding or sale of any
security.
8. Limitation of Trust's Liability. The Advisor acknowledges
that it has received notice of and accepts the limitations upon the Trust's
liability set forth in Article XI of its Declaration of Trust. The Advisor
agrees that the Trust's obligations hereunder in any case shall be limited to
the Trust and to its assets and that the Advisor shall not seek satisfaction
of any such obligation from the shareholders of the Trust nor from any
Trustees, officer, employee or agent of the Trust.
9. Force Majeure. The Advisor shall not be liable for delays
or errors occurring by reason of circumstances beyond its control, including
but not limited to acts of civil or military authority, national emergencies,
work stoppages, fire, flood, catastrophe, acts of God, insurrection, war,
riot, or failure of communication or power supply. In the event of equipment
breakdowns beyond its control, the Advisor shall take reasonable steps to
minimize service interruptions but shall have no liability with respect
thereto.
10. Renewal, Termination and Amendment. This Agreement shall
continue in effect with respect to each Fund, unless sooner terminated as
hereinafter provided for two years from the effective date as to that Fund,
and indefinitely thereafter if its continuance after such one year period
shall be specifically approved at least annually by vote of the holders of a
majority of the outstanding voting securities of the Fund or by vote of a
majority of the Trust's Board of Trustees; and further provided that such
continuance is also approved annually by the vote of a majority of the
Trustees who are not parties to this Agreement or interested persons of the
Advisor, cast in person at a meeting called for the purpose of voting on such
approval. This Agreement may be terminated at any time with respect to a
Fund, without payment of any penalty, by the Trust's Board of Trustees or by
vote of the majority of the outstanding voting securities of the Fund upon 60
days' prior written notice to the Advisor and by the Advisor upon 60 days'
prior written notice to the Trust. This Agreement may be amended with respect
to a Fund at any time by the parties, subject to approval by the Trust's Board
of Trustees and, if required by applicable SEC rules and regulations, a vote
of a majority of the Fund's outstanding voting securities. This Agreement
shall terminate automatically in the event of its assignment. The terms
"assignment", "interested person", and "vote of a majority of the outstanding
voting securities" shall have the meaning set forth for such terms in the 1940
Act.
11. Severability. If any provision of this Agreement shall be
held or made invalid by a court decision, statute, rule or otherwise, the
remainder of this Agreement shall not be affected thereby.
12. Miscellaneous. Each party agrees to perform such further
actions and execute such further documents as are necessary to effectuate the
purposes hereof. This Agreement shall be construed and enforced in accordance
with and governed by the laws of the State of Maryland. The captions in this
Agreement are included for convenience only and in no way define or delimit
any of the provisions hereof
or otherwise affect their construction or effect.
IN WITNESS WHEREOF, the parties have duly executed this Agreement as
of the date first written above.
Calvert Social Investment Fund
By:__________________
Calvert Asset Management Company, Inc.
By:__________________
Fee Schedule to the Investment Advisory Agreement
between Calvert Asset Management Company, Inc. and
Calvert Social Investment Fund Equity Portfolio
As compensation pursuant to Section 4 of the Investment Advisory Agreement
between Calvert Asset Management Company, Inc. (the "Advisor") and Calvert
Social Investment Fund (the "Trust") dated September __, 1998, with respect to
the above-referenced Portfolio of the Trust (the "Fund"), the Advisor is
entitled to receive from the Fund an advisory fee (the "Fee").
The annual Fee shall be computed daily and payable monthly, at an annual rate
of 70 basis points of the average daily net assets of the Fund.
<PAGE>
APPENDIX B
PROPOSED INVESTMENT SUBADVISORY AGREEMENT
INVESTMENT SUBADVISORY AGREEMENT, effective September __, 1998, by
and between Calvert Asset Management Company, Inc., a Delaware corporation
registered as an investment Advisor under the Investment Advisors Act of 1940
(the "Advisor"), and Atlanta Capital Management Company, L.L.C.., a
Georgia corporation, (the "Subadvisor").
WHEREAS, the Advisor is the investment advisor to the Calvert Social
Investment Fund (the "Trust"), an open-end, diversified management investment
company registered under the Investment Company Act of 1940, as amended (the
"1940 Act"); and
WHEREAS, the Advisor desires to retain the Subadvisor to furnish it
with certain investment advisory services in connection with the Advisor's
investment advisory activities on behalf of the Trust and any series of the
Trust, for which Schedules are attached hereto (each such series referred to
individually as the "Fund").
NOW, THEREFORE, in consideration of the terms and conditions
hereinafter set forth, it is hereby agreed as follows:
1. Services to be Rendered by the Subadvisor to the Fund.
(a) Investment Program. Subject to the control of the
Trust's Board of Trustees and the Advisor, the Subadvisor at its
expense continuously will furnish to the Fund an investment program
for such portion, if any, of Fund assets designated by the Advisor
from time to time. With respect to such assets, the Subadvisor will
make investment decisions, subject to Section 1(g) of this Agreement,
and will place all orders for the purchase and sale of portfolio
securities. The Subadvisor is deemed to be an independent contractor
and, except as expressly provided or authorized by this Agreement,
has no authority to act for or represent the Trust or the Advisor in
any way or otherwise be deemed an agent of the Trust or the Advisor.
In the performance of its duties, the Subadvisor will act in the best
interests of the Fund and will comply with (i) applicable laws and
regulations, including, but not limited to, the 1940 Act and
Subchapter M of the Internal Revenue Code of 1986, as amended, (ii)
the terms of this Agreement, (iii) the Trust 's Declaration of Trust,
Bylaws and Registration Statement as from time to time amended, (iv)
relevant undertakings provided to State securities regulators, (v)
the stated investment objective, policies and restrictions of the
Fund, and (vi) such other guidelines as the Board of Trustees or
Advisor may establish. The Advisor is responsible for providing the
Subadvisor with current copies of the materials specified in
Subsections (a)(iii), (iv), (v) and (vi) of this Section 1.
(b) Availability of Personnel. The Subadvisor at its
expense will make available to the Trustees and Advisor at reasonable
times its portfolio managers and other appropriate personnel, either
in person or, at the mutual convenience of the Advisor and the
Subadvisor, by telephone, in order to review the Fund's investment
policies and to consult with the Trustees and Advisor regarding the
Fund's investment affairs, including economic, statistical and
investment matters relevant to the Subadvisor's duties hereunder, and
will provide periodic reports to the Advisor relating to the
investment strategies it employs.
(c) Expenses, Salaries and Facilities. The Subadvisor
will pay all expenses incurred by it in connection with its
activities under this Agreement (other than the cost of securities
and other investments, including any brokerage commissions and all
taxes, including any interest and penalties with respect thereto)
including, but not limited to, all salaries of personnel and
facilities required for it to execute its duties under this Agreement.
(d) Compliance Reports. The Subadvisor at its expense
will provide the Advisor with such compliance reports relating to its
duties under this Agreement as may be agreed on by such parties from
time to time.
(e) Valuation. The Subadvisor will assist the Fund and
its agents in determining whether prices obtained for valuation
purposes accurately reflect market price information relating to the
assets of the Fund for which the Subadvisor has responsibility on a
daily basis (unless otherwise agreed on by the parties hereto) and at
such other times as the Advisor shall reasonably request.
(f) Executing Portfolio Transactions.
(i) Brokerage. In selecting brokers and dealers to
execute purchases and sales of investments for the
Fund, the Subadvisor will use its best efforts to
obtain the most favorable price and execution
available in accordance with this paragraph. The
Subadvisor agrees to provide the Advisor and the
Fund with copies of its policy with respect to
allocation of brokerage on trades for the Fund.
Subject to review by the Trustees of appropriate
policies and procedures, the Subadvisor may cause
the Fund to pay a broker a commission for effecting
a portfolio transaction, in excess of the
commission another broker would have charged for
effecting the same transaction. If the
broker provided brokerage and/or research services,
including statistical data, to the Subadvisor, the
Subadvisor shall not be deemed to have acted
unlawfully, or to have breached any duty created by
this Agreement, or otherwise, solely by reason of
acting according to such authorization.
(ii) Aggregate Transactions. In executing
portfolio transactions for the Fund, the Subadvisor
may, but will not be obligated to, aggregate the
securities to be sold or purchased with those of
its other clients where such aggregation is not
inconsistent with the policies of the Fund, to the
extent permitted by applicable laws and
regulations. If the Subadvisor chooses to
aggregate sales or purchases, it will allocate the
securities as well as the expenses incurred in the
transaction in the manner it considers to be the
most equitable and consistent with its fiduciary
obligations to the Fund and its other clients
involved in the transaction..
(iii) Directed Brokerage. The Advisor may
direct the Subadvisor to use a particular broker or
dealer for one or more trades if, in the sole
opinion of the Advisor, it is in the best interest
of the Fund to do so.
(iv) Brokerage Accounts. The Advisor
authorizes and empowers the Subadvisor to direct
the Fund's custodian to open and maintain brokerage
accounts for securities and other property,
including financial and commodity futures and
commodities and options thereon (all such accounts
hereinafter called "brokerage accounts") for and in
the name of the Fund and to execute for the Fund as
its agent and attorney-in-fact standard customer
agreements with such broker or brokers as the
Subadvisor shall select as provided above. The
Subadvisor may, using such of the securities and
other property in the Fund as the Subadvisor deems
necessary or desirable, direct the Fund's custodian
to deposit for the Fund original and maintenance
brokerage and margin deposits and otherwise direct
payments of cash, cash equivalents and securities
and other property into such brokerage accounts and
to such brokers as the Subadvisor deems desirable
or appropriate.
(g) Social Screening. The Advisor is responsible for
screening those investments of the Fund subject to social screening
("Securities") to determine that the Securities investments meet the
Fund's social investment criteria, as may be amended from time to
time by the Trustees and for notifying the Subadvisor of its
determination. The Subadvisor will buy only those Securities
permitted by the Fund's investment program which the Advisor
determines pass the Fund's social screens and of which the Advisor
has notified the Subadvisor. In the event that the Advisor notifies
the Subadvisor that a security already in the Fund's portfolio no
longer passes the Fund's social screen, the Advisor shall instruct
the Subadvisor whether the Subadvisor should dispose of the security
immediately or at such time as the Subadvisor believes would be least
detrimental to the Fund. To the extent instructed by the Advisor,
the Subadvisor shall have no liability for the disposition of any
securities under this paragraph. With respect to this paragraph, the
form of notification shall be mutually agreed upon by the parties.
(h) Voting Proxies. The Subadvisor agrees to take
appropriate action (which includes voting) on all proxies for the
Fund's portfolio investments in a timely manner in accordance with
the Advisor's Proxy Voting Guidelines, a copy of which has been
provided to the Subadvisor.
(i) Furnishing Information for the Fund's Proxies and
Other Required Mailings. The Subadvisor agrees to provide the
Advisor in a timely manner with all information necessary, including
information concerning the Subadvisor's controlling persons, for
preparation of the Fund's proxy statements or other required
mailings, as may be needed from time to time.
2. Books and Records.
(a) In connection with the purchase and sale of the
Fund's portfolio securities, the Subadvisor shall arrange for the
transmission to the Fund's custodian, and/or the Advisor on a daily
basis, of such confirmations, trade tickets or other documentation as
may be necessary to enable the Advisor to perform its accounting and
administrative responsibilities with respect to the management of the
Fund.
(b) Pursuant to Rule 31a-3 under the 1940 Act, Rule
204-2 under the Investment Advisors Act of 1940, and any other
applicable laws, rules or regulations regarding recordkeeping, the
Subadvisor agrees that: (i) all records it maintains for the Fund
are the property of the Fund; (ii) it will surrender promptly to the
Fund or Advisor any such records upon the Fund's or Advisor's
request; (iii) it will maintain for the Fund the records that the
Fund is required to maintain under Rule 31a-1(b) or any other
applicable rule insofar as such records relate to the investment
affairs of the Fund for which the Subadvisor has responsibility under
this Agreement; and (iv) it will preserve for the periods prescribed
by Rule 31a-2 under the 1940 Act the records it maintains for the
Fund.
(c) The Subadvisor represents that it has adopted and
will maintain at all times a suitable Code of Ethics that covers its
activities with respect to its services to the Fund.
(d) The Subadvisor shall supply to the Trust's Board of
Trustees its policies on "soft dollars," trade allocations and
brokerage allocation procedures. The Subadvisor shall maintain
appropriate fidelity bond and errors and omission insurance policies.
3. Exclusivity. Each party and its affiliates may have
advisory, management service or other agreements with other organizations and
persons, and may have other interests and businesses; provided, however, that
during the term of the Agreement, the Subadvisor will not provide investment
advisory services ("Services") to any other investment company offered to the
public and registered under the 1940 Act which is "socially screened" and has
an investment objective, a Matrix and/or quantitative strategy and the same
asset class (large cap U.S. equity) as the Fund except to the extent that, as
of January 1, 1998 the Subadvisor has entered into a written agreement(s) to
provide such Services or to the extent mutually agreed upon in writing between
the parties.
4. Compensation. The Advisor will pay to the Subadvisor as
compensation for the Subadvisor's services rendered pursuant to this Agreement
an annual Subadvisory fee as specified in one or more Schedules attached
hereto and made part of this Agreement. Such fees shall be paid by the
Advisor (and not by the Fund). Such fees shall be payable for each month
within 15 business days after the end of such month. If the Subadvisor shall
serve for less than the whole of a month, the compensation as specified shall
be prorated based on the portion of the month for which services were
provided. The Schedules may be amended from time to time, in writing agreed
to by the Advisor and the Subadvisor, provided that amendments are made in
conformity with applicable laws and regulations and the Declaration of Trust
and Bylaws of the Trust. Any change in the Schedule pertaining to any new or
existing series of the Trust shall not be deemed to affect the interest of any
other series of the Trust and shall not require the approval of shareholders
of any other series of the Trust.
5. Assignment and Amendment of Agreement. This Agreement
automatically shall terminate without the payment of any penalty in the event
of its assignment (as defined under the 1940 Act) or if the Investment
Advisory Agreement between the Advisor and the Trust relating to the Fund
shall terminate for any reason. This Agreement constitutes the entire
agreement between the parties, and may not be amended except in a writing
signed by both parties. This Agreement shall not be materially amended
unless, if required by Securities and Exchange Commission rules and
regulations, such amendment is approved by the affirmative vote of a majority
of the outstanding shares of the Fund, and by the vote, cast in person at a
meeting called for the purpose of voting on such approval, of a majority of
the Trustees of the Trust who are not interested persons of the Trust, the
Advisor or the Subadvisor.
6. Duration and Termination of the Agreement. This Agreement
shall become effective upon its execution; provided, however, that this
Agreement shall not become effective with respect to any Fund now existing or
hereafter created unless it has first been approved (a) by a vote of the
majority of those Trustees of the Trust who are not parties to this Agreement
or interested persons of such party, cast in person at a meeting called for
the purpose of voting on such approval, and (b) by a vote of a majority of
that Fund's outstanding voting securities or pursuant to the Fund's exemptive
order governing the requirement of such a vote. This Agreement shall remain
in full force and effect with respect to a Fund continuously thereafter
(unless terminated automatically as set forth in Section 5.) except as follows:
(a) The Trust may at any time terminate this Agreement
without penalty with respect to any or all Funds by providing not
less than 60 days written notice delivered or mailed by registered
mail, postage prepaid, to the Advisor and the Subadvisor. Such
termination can be authorized by the affirmative vote of a majority
of the (i) Trustees of the Trust or (ii) outstanding voting
securities of the applicable Fund.
(b) This Agreement will terminate automatically with respect to a Fund
unless, within two years of the effective date of this Agreement, and at least
annually thereafter, the continuance of the Agreement is specifically approved
by (i) the Trustees of the Trust or the shareholders of such Fund by the
affirmative vote of a majority of the outstanding shares of such Fund, and (ii)
a majority of the Trustees of the Trust who are not interested persons of the
Trust, Advisor or Subadvisor, by vote cast in person at a meeting called for the
purpose of voting on such approval. If the continuance of this Agreement is
submitted to the shareholders of any Fund for their approval and such
shareholders fail to approve such continuance as provided herein, the Subadvisor
may continue to serve hereunder in a manner consistent with the 1940 Act and the
rules and regulations thereunder.
(c) The Advisor may at any time terminate this
Agreement with respect to any or all Funds by not less than 60 days
written notice delivered or mailed by registered mail, postage
prepaid, to the Subadvisor, and the Subadvisor may at any time
terminate this Agreement with respect to any or all Funds by not less
than 90 days written notice delivered or mailed by registered mail,
postage prepaid, to the Advisor, unless otherwise mutually agreed in
writing.
(d) The Advisor may terminate this Agreement with
respect to any or all Funds immediately by written notice if the
Confidentiality and Non-Use Agreement referred to in Section 11 of
this Agreement is, in the sole opinion of the Advisor, violated.
Upon termination of this Agreement with respect to any Fund:
(a) the duties of the Advisor delegated to the Subadvisor
under this Agreement with respect to such Fund
automatically shall revert to the Advisor, and
(b) both parties agree to use reasonable efforts to jointly
issue public statements, other than those public
statements required by law, regarding the termination.
7. Notification to the Advisor. The Subadvisor promptly shall
notify the Advisor in writing of the occurrence of any of the following events:
(a) the Subadvisor shall fail to be registered as an investment Adviser
under the Investment Advisers Act of 1940, as amended, and under the laws of any
jurisdiction in which the Subadvisor is required to be registered as an
investment Adviser in order to perform its obligations under this Agreement;
(b) the Subadvisor shall have been served or otherwise have
notice of any action, suit, proceeding, inquiry or investigation, at
law or in equity, before or by any court, public board or body,
directly involving the affairs of the Fund;
(c) a material violation of the Subadvisor's Code of Ethics
is discovered and, again, when action has been taken to rectify such
violations; or
(d) any other event, including but not limited to, a change
in executive personnel or the addition or loss of major clients of
the Subadvisor that might affect the ability of the Subadvisor to
provide the Services provided for under this Agreement.
8. Definitions. For the purposes of this Agreement, the terms
"vote of a majority of the outstanding Shares," "affiliated person,"
"control," "interested person" and "assignment" shall have their respective
meanings as defined in the 1940 Act and the rules and regulations thereunder
subject, however, to such exemptions as may be granted by the Securities and
Exchange Commission under said Act; and the term "specifically approve at
least annually" shall be construed in a manner consistent with the 1940 Act
and the rules and regulations thereunder.
9. Indemnification. The Subadvisor shall indemnify and hold
harmless the Advisor, the Trust and their respective trustees, directors,
officers and shareholders from any and all claims, losses, expenses,
obligations and liabilities (including reasonable attorneys fees) arising or
resulting from the Subadvisor's willful misfeasance, bad faith, gross
negligence or reckless disregard of its duties hereunder.
The Advisor shall indemnify and hold harmless the Subadvisor, the
Trust and their respective Trustees, directors, officers, employees and agents
and shareholders from any and all claims, losses, expenses, obligations and
liabilities (including reasonable attorneys fees) arising or resulting from
the Advisor's willful misfeasance, bad faith, gross negligence or reckless
disregard of its duties hereunder or under its Investment Advisory Agreement
with the Trust.
10. Applicable Law and Jurisdiction. This Agreement shall be
governed by Maryland law, and any dispute arising from this Agreement or the
services rendered hereunder shall be resolved through legal proceedings,
whether state, federal, or otherwise, conducted in the state of Maryland or in
such other manner or jurisdiction as shall be mutually agreed upon by the
parties hereto.
11. Miscellaneous. Notices of any kind to be given to a party
hereunder shall be in writing and shall be duly given if mailed, delivered or
communicated by answer back facsimile transmission to such party at the
address set forth below, attention President, or at such other address or to
such other person as a party may from time to time specify.
Subadvisor agrees that for a period of two (2) years from the date of
termination of this Agreement, it shall not directly or indirectly, hire,
employ or engage, or attempt to hire, employ or engage any employee of the
Advisor or any affiliate thereof without the prior written permission of the
Advisor.
Each party agrees to perform such further acts and execute such
further documents as are necessary to effectuate the purposes hereof. The
captions in this Agreement are included for convenience only and in no way
define or delimit any of the provisions hereof or otherwise affect their
construction or effect.
Each party represents and warrants that it has all requisite
authority to enter into and carry out its responsibilities under this
Agreement.
IN WITNESS WHEREOF, each of the parties has caused this instrument to
be signed in duplicate on its behalf by its duly authorized representative,
all as of the day and year first written above.
Witness: Calvert Asset Management Company, Inc.
4550 Montgomery Avenue, Suite 1000N
Bethesda, Maryland 20814
By:_______________ By:________________
Witness: Atlanta Capital Management Company, L.L.C..
Two Midtown Plaza, Suite 1600
1360 Peachtree Street
Atlanta, GA 30309
By:_______________ By:______________
Fee Schedule to the Investment Subadvisory Agreement
between Calvert Asset Management Company, Inc.
and Atlanta Capital Management Company, L.L.C..
As compensation pursuant to Section 4 of the Investment Subadvisory
Agreement between Calvert Asset Management Company, Inc. (the "Advisor") and
Atlanta Capital Management Company, L.L.C.. (the "Subadvisor") dated September
__, 1998, with respect to the Calvert Social Investment Fund Equity Portfolio,
the Advisor shall pay the Subadvisor a subadvisory fee, computed daily and
payable monthly, at an annual rate of 30 basis points of the average daily net
assets of the Equity Portfolio.
<PAGE>
APPENDIX C
Fundamental Investment Restrictions The Fund has adopted the following
investment restrictions which, together with the foregoing investment objectives
and fundamental policies of the Equity Portfolio, cannot be changed without the
approval of the holders of a majority of the outstanding shares of the
Portfolio. As defined in the Investment Company Act of 1940, this means the
lesser of the vote of (a) 67% of the shares of the Portfolio at a meeting where
more than 50% of the outstanding shares are present in person or by proxy or (b)
more than 50% of the outstanding shares of the Portfolio. Shares have equal
rights as to voting, except that only shares of the Portfolio are entitled to
vote on matters affecting only that Portfolio (such as changes in investment
objective, policies or restrictions). The Equity Portfolio may not:
1. Purchase securities of any issuer (other than obligations
of, or guaranteed by, the United States Government, its
agencies or instrumentalities) if, as a result, more than 5%
of the value of that Portfolio's total assets would be
invested in securities of that issuer.
2. Concentrate more than 25% of the value of its assets in any
one industry; provided, however, that there is no limitation
with respect to investments in obligations issued or
guaranteed by the United States Government or its agencies
and instrumentalities, and repurchase agreements secured
thereby.
3. Purchase more than 10% of the outstanding voting securities
of any issuer. In addition, the Fund may not in the
aggregate purchase more than 10% of the outstanding voting
securities of any issuer.
4. Purchase the securities of any issuer with less than three
years' continuous operation if, as a result, more than 5% of
the value of that Portfolio's total assets would be invested
in securities of such issuers.
5. Make loans other than through the purchase of money market
instruments and repurchase agreements or by the purchase of
bonds, debentures or other debt securities. The purchase by
a Portfolio of all or a portion of an issue of publicly or
privately distributed debt obligations in accordance with
its investment objective, policies and restrictions, shall
not constitute the making of a loan.
6. Underwrite the securities of other issuers.
7. Purchase from or sell to any of the Fund's officers or
Trustees, or firms of which any of them are members, any
securities (other than capital stock of the Fund), but such
persons or firms may act as brokers for the Fund for
customary commissions.
8. Borrow money, except from banks for temporary or emergency
purposes and then only in an amount up to 10% of the value
of that Portfolio's total assets and except by engaging in
reverse repurchase agreements; provided, however, that a
Portfolio may only engage in reverse repurchase agreements
so long as, at the time a Portfolio enters into a reverse
repurchase agreement, the aggregate proceeds from
outstanding reverse repurchase agreements, when added to
other outstanding borrowings permitted by this section, do
not exceed 33 1/3% of the Portfolio's total assets. In order
to secure any permitted borrowings and reverse repurchase
agreements under this section, each Portfolio may pledge,
mortgage or hypothecate its assets.
9. Make short sales of securities or purchase any securities
on margin except as provided for the Equity
Portfolio with respect to options, futures
contracts and options on futures contracts.
10. Write, purchase or sell puts, calls or combinations thereof
except as provided for the Equity Portfolio with respect to options,
futures contracts and options on futures contracts.
11. Invest for the purpose of exercising control or management
of another issuer.
12. Invest in commodities, commodities futures contracts, or
real estate, although it may invest in securities which are
secured by real estate or real estate mortgages and
securities of issuers which invest or deal in commodities,
commodity futures, real estate or real estate mortgages and
provided that the Equity Portfolio
may purchase or sell stock index futures, foreign currency
futures, interest rate futures and options thereon.
13. Invest in interests in oil, gas, or other mineral
exploration or development programs, although it may invest
in securities of issuers which invest in or sponsor such
programs.
14. Purchase or retain securities issued by investment
companies except to the extent permitted by the Investment
Company Act of 1940, as amended, and in connection with a
trustee's/director's deferred compensation plan.
<PAGE>
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1Pursuant to Rule 15a-4, an investment advisor may provide services to a
portfolio and be paid for those services pursuant to a contract not yet
approved by shareholders for a maximum period of 120 days, provided that (a)
the Board of Trustees of the Fund has approved the contract, and (b) the
compensation does not exceed the amount payable to the preceding portfolio
manager under its contract with the Fund.
2Pursuant to Rule 15a-4, an investment advisor may provide services to a
portfolio and be paid for those services pursuant to a contract not yet
approved by shareholders for a maximum period of 120 days, provided that (a)
the Board of Trustees of the Fund has approved the contract, and (b) the
compensation does not exceed the amount payable to the preceding portfolio
manager under its contract with the Fund.
