SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a)
OF THE SECURITIES EXCHANGE ACT OF 1934
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted by
Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Sec. 240.14a-11(c) or Sec. 240.14a-12
Acacia Capital Corporation
(Name of Registrant as Specified in Its Charter)
Calvert Responsibly Invested
Strategic Growth Portfolio
Calvert Responsibly Invested
Strategic Growth Portfolio
(Name of Person Filing Proxy Statement)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1)
and 0-11.
(1) Title of each class of securities to which transaction applies:
(2) Aggregate number of securities to which transaction applies:
(3) Per unit price or other underlying value of transaction
computed pursuant to Exchange Act Rule 0-11:
(4) Proposed maximum aggregate value of transaction:
(5) Total Fee Paid:
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by
Exchange Act Rule 0-11(a) (2) and identify the filing for which the
offsetting fee was paid previously. Identify previous filing by
registration statement number, or the Form or Schedule and the date
its filing.
(1) Amount Previously Paid:
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(4) Date Filed:
<PAGE>
Dear Policyholder:
I am writing to inform you of the upcoming special meeting of
shareholders of the Acacia Capital Corporation, Calvert Responsibly
Invested Strategic Growth 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 Portfolio. The Board of Directors, including myself,
believes this change is in your 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 Portfolio and with the investment
advisor, Calvert Asset Management Company, Inc. This agreement
is identical to the existing agreement except that it reflects a
lower fee structure.
Question 2 asks shareholders to approve a new investment
subadvisory agreement with the new investment subadvisor,
Awad & Associates, who replaced Portfolio Advisory Services, Inc.
effective October 1, 1997. This agreement is identical to the
existing investment subadvisory agreement in all material respects
except that it also reflects a lower fee structure.
Question 3 asks shareholders to approve new investment
objective, policies and restrictions for the Portfolio which
focuses the portfolio composition on small capitalized growth
companies.
Question 4 asks shareholders to approve Acacia Capital
Corporation and the Advisor being able to enter into and amend
the investment subadvisory agreement in the future without
shareholder approval.
Regardless of the number of units 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, your 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
President
<PAGE>
Acacia Capital Corporation
Calvert Responsibly Invested
Strategic Growth Portfolio
4550 Montgomery Avenue, Suite 1000N
Bethesda, Maryland 20814
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
To be held on Tuesday, December 2, 1997
NOTICE IS HEREBY GIVEN that the Special Meeting of Shareholders of
CRI Strategic Growth Portfolio (the "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
10:00 a.m. on Tuesday, December 2, 1997 for the following purposes:
I. To approve a new investment advisory agreement with the
investment advisor, Calvert Asset Management Company, Inc.,
identical to the existing agreement in all material respects,
except that it: (a) reflects a new fee structure and (b) does
not provide for a performance fee.
II. To approve a new investment subadvisory agreement with the
investment subadvisor, Awad & Associates, identical to the
existing agreement in all material respects, except that it: (a)
reflects a new fee structure and (b) does not provide for a
performance fee.
III. To approve new investment objective, policies and restrictions
for the Portfolio.
IV. To approve Acacia Capital Corporation and Calvert Asset
Management Company, Inc. entering into and materially amending
the investment subadvisory agreement in the future without
shareholder approval.
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 October 15, 1997 are
entitled to notice of and to vote at this Special Meeting or any
adjournment thereof.
By Order of the Directors,
William M. Tartikoff, Esq.
Secretary
October 24, 1997
Please execute the enclosed proxy and return it promptly in the
enclosed envelope, thus enabling the 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>
INSTRUCTIONS FOR EXECUTING PROXY CARD
Voting instruction forms must be executed properly. When forms are
not signed as required by law, the Portfolio must undertake the time
and expense to take steps to validate your vote. The following general
guide may help you choose the proper format for signing your form:
1. Individual Accounts: Your name should be signed exactly as it
appears in the registration on the voting instruction form.
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 voting
instruction form. For example:
REGISTRATION VALID SIGNATURE
A. CORPORATE ACCOUNTS
1) Save the Earth Corp. Jane Q. Nature, Treasurer
2) Save the Earth Corp. Jane Q. Nature, Treasurer
c/o Jane Q. Nature, Treasurer
B. TRUST ACCOUNTS
1) Save the Earth Corp. Profit Sharing Plan Jon B. Goodhealth, Trustee
Save the Earth Trust Jon B. Goodhealth, Trustee
2) Jon B. Goodhealth, Trustee Jon B. Goodhealth, Trustee
u/t/d 5/1/78
C. CUSTODIAL OR REAL ESTATE ACCOUNTS
1) Jason Smith, Cust. Jason Smith
f/b/o Jason Smith UGMA
2) Jason B. Smith, Jr., Jason B. Smith, Jr., Executor
Voting by mail is quick and easy. Everything you need is enclosed.
<PAGE>
PROXY STATEMENT
Acacia Capital Corporation
Calvert Responsibly Invested
Strategic Growth Portfolio
4550 Montgomery Avenue, Suite 1000N
Bethesda, Maryland 20814
October 24, 1997
This statement is furnished in connection with the solicitation of proxies
by the Board of Directors of Acacia Capital Corporation (the "Fund") to be used
at the Special Meeting of Shareholders of the Calvert Responsibly Invested
Strategic Growth Portfolio (the "CRI Strategic Growth 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 10:00 a.m. on Tuesday, December 2, 1997, or at such later time or date made
necessary by adjournment for the purpose set forth in the Notice of Meeting.
The CRI Strategic Growth Portfolio is a series of the Acacia Capital
Corporation, an open-end management investment company incorporated in Maryland
on September 27, 1982. The Fund is authorized to issue three hundred fifty
million shares of stock, par value of $1.00 per share. Issued shares are fully
paid and non assessable and have no preemptive or conversion rights. Shareholder
voting rights are not cumulative.
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 statement, the Fund seeks shareholder approval to change
investment objective, policies and restrictions of the CRI Strategic
Growth Portfolio, and to change its classification under the Investment
Company Act of 1940 ("Act") from "non-diversified" to "diversified."
Fundamental policies may be changed only by shareholder vote, while
non-fundamental, or operating, policies may be changed by vote of the
Board without shareholder approval.
The Fund also seeks shareholder approval of a new investment
subadvisory agreement which is identical to the existing agreement in
all material respects, except that it reflects a new fee structure as
discussed herein and does not provide for a performance fee.
Lastly, the Fund 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 and materially amend the Investment
Subadvisory Agreement without shareholder approval.
PROPOSALS
I. To approve a new investment advisory agreement with the
investment advisor, Calvert Asset Management Company, Inc.,
identical to the existing agreement in all material respects,
except that it: (a) reflects a new fee structure and (b) does
not provide for a performance fee.
The Board of Directors has approved, and recommends that shareholders
approve, a new Investment Advisory Agreement between CAMCO and the Fund with
respect to the CRI Strategic Growth Portfolio. The proposed Advisory Agreement
is identical to the existing agreement in all material respects, except that it
contains a new fee structure and no performance adjustment. This new fee
struction reflects a lower advisory fee. Recognizing the substantial changes
that are proposed to occur to the CRI Strategic Growth Portfolio, CAMCO proposes
to lessen the fees structure to reflect an advisory fee of .90% of the
Portfolio's average daily net assets instead of the previous advisory of 1.50%
of the average daily net assets (which could also be adjusted with a performance
fee of 0.15%). Accordingly, the proposed lower fee structure will equate to a
reduction in portfolio expenses which would directly benefit the CRI Strategic
Growth Portfolio and its shareholders.
The agreement with CAMCO as it related to CRI Strategic Growth is
dated as of June 30, 1992. Under that agreement, CAMCO received a fee
from the Portfolio based on a percentage of the Portfolio's average
daily net assets plus or minus a performance adjustment. During
fiscal year ended December 31, 1996, $2,368,558 in fees were paid to
CAMCO.
The Proposed Investment Advisory Agreement. The proposed Investment
Advisory Agreement (the "Advisory Agreement") between the Portfolio
and CAMCO, reproduced in Appendix A, is under substantially the same
terms as governed the previous arrangement with CAMCO, except as
described below. If approved by shareholders, the Agreement will
continue to January 1, 1999 unless terminated earlier by either
party, and will continue thereafter on an annual basis if approved by
the Directors or shareholders and a majority of the Directors who are
not interested persons of the Fund, Advisor or Subadvisor. Until
shareholders approve the new Advisory Agreement, the 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* If shareholders do not approve the Agreement
at the upcoming Special Meeting or any adjournment, CAMCO will
continue to act under the existing Investment Advisory Agreement.
*Pursuant 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 Directors 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.
Under the previous arrangement, CAMCO was paid 1.50% of average daily
net assets and the Advisor adjusted this fee based on the extent to
which performance of the Fund exceeded or trailed the Russell 2000
Index:
<TABLE>
<CAPTION>
Performance versus the Performance Fee
Russell 2000 Index Adjustment
<S> <C> <C>
30% to less than 60% 0.05%
60% to less than 90% 0.10%
90% or more 0.15%
</TABLE>
Comparison Of Advisory Fees.
Existing Investment Advisory Proposed Investment Advisory
Agreement Agreement
________________________ __________________________
1.50% on all Portfolio assets 0.90% on average daily net assets
plus a performance adjustment
of plus/minus 0.15%
Based on its evaluation of the materials presented and assisted by
the advice of independent counsel, the Board of Directors concluded
that the proposed investment advisory agreement with CAMCO is in the
best interest of the Portfolio's shareholders. The Board of
Directors voted to approve the submission of the Investment Advisory
Agreement to shareholders of the Portfolio and recommends that
shareholders vote FOR the Agreement.
II. To approve a new investment subadvisory agreement with the
investment advisor, Awad & Associates, identical to the existing
agreement in all material respects, except that it: (a) reflects
a new fee structure and (b) does not provide for a performance
fee.
The Advisor has traditionally contracted out subadvisory services for the
CRI Strategic Growth Portfolio. From inception through September 30, 1997, the
CRI Strategic Growth Portfolio's subadvisor was Portfolio Advisory Services,
Inc. ("PASI"), a California corporation. Its principal business office is 725
South Figueroa Street, Suite 2328, Los Angeles, California, 90017.
The agreement with PASI as it related to the CRI Strategic Growth Portfolio is
dated as of January 3, 1995. Under that agreement, PASI received a
fee from the Advisor based on a percentage of the CRI Portfolio's average
daily net assets plus or minus a performance adjustment. During
fiscal year ended December 31, 1996, $1,412,861 in fees were paid to
PASI.
At the September 9, 1997 meeting of the Board of Directors, the Board
terminated PASI as the subadvisor to the Strategic Growth Portfolio
effective the same date. 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
Portfolio's objective of capital appreciation. After careful
consideration by the Advisor of the many candidates, the Advisor
recommended, and the Board selected (subject to shareholder
approval), Awad & Associates ("AWAD") as subadvisor for the
Portfolio. In order to make its decision, the Board, via Management,
requested information about AWAD, and AWAD supplied information which
Management and the Board subsequently evaluated. 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 AWAD, and AWAD made a presentation
to the Board and responded to members' questions at the Board
meeting.
Awad & Associates. AWAD is a joint venture between James D. Awad and
Raymond James Financial, Inc., a New York Stock Exchange investment
firm. Awad was established in 1992 and is located at 477 Madison Avenue, New
York, New York 10022. AWAD had $947 million in assets under
management as of September 30, 1997. The firm's portfolio managers adhere
to a bottom-up, earnings-driven discipline with emphasis on internal
fundamental research.
AWAD is a division of Raymond James & Associates, Inc., a full-service
brokerage and New York Stock Exchange member, whose main offices are located at
The Raymond James Financial Center, 880 Carillon Parkway, St. Petersburg,
Florida 33716. AWAD is a subsidiary of Raymond James Financial, Inc., a
diversified financial services holding company whose subsidiaries engage
primarily in securities brokerage, investment banking, asset management, banking
and trust services. Raymond James Financial's corporate headquarters are located
at The Raymond James Financial Center, 880 Carillon Parkway, St. Petersburg,
Florida 33716.
AWAD currently provides investment advisory services to four other mutual
funds with investment objectives similar to that of the CRI Strategic Growth
Portfolio, as follows:
Mutual Fund Assets Under Management Management Fees
Calvert New Vision Small Cap Fund $3.5 million 0.40% of net assets
Calvert Strategic Growth Fund $110 million 0.40% of net assets
Heritage Small Cap Stock Fund $121.6 million 0.50% of net assets
The Timothy Plan $18 million 0.45% of net assets
With respect to these other mutual funds, AWAD has not waived, reduced, or
otherwise agreed to reduce its compensation under the applicable investment
management contracts.
AWAD's Investment Professionals. James D. Awad is the Chairman and
Chief Investment Officer of AWAD. Mr. Awad has been in the investment
business since 1965, focusing on research and portfolio management.
Prior to forming AWAD, he was President of BMI Capital, a money management
firm he founded. In addition, he has managed assets at Neuberger & Berman,
Channing Management and First Investment Corp. Mr. Awad earned an MBA
from Harvard Business School and a BS Cum Laude from Washington & Lee
University.
Dennison T. Veru is President of AWAD. Mr. Veru joined AWAD in 1992
coming from Smith Barney Harris Upham where he was Senior Vice
President of the firm's Whiffletree Capital Management division
specializing in small and medium capitalization stocks. From 1988
through 1990, he was a Vice President of Broad Street Investment
Management. Prior to that, he was an Assistant Vice President at
Drexel Burnham Lambert. Mr. Veru is a graduate of Franklin and
Marshall College.
AWAD's Investment Strategy. AWAD specializes in small capitalization
stocks, focusing on growth at a value price, bottom-up approach to
stock selection. The firm's main investment objective in asset
management is to protect the investor's capital, generate capital
appreciation substantially in excess of inflation and reduced-risk
returns and provide returns in excess of applicable stock and bond
indices. All portfolio investments are regularly scrutinized to
provide a substantial risk/return benefit and to ensure that
portfolios are properly positioned relative to the client's investment
objectives.
AWAD's investment strategy is to: (1) "invest in quality" companies
with steady earnings and cash flow growth, dominant market position
or strong niche franchise and a good (or improving) balance sheet,
excess cash flow generation from operations, strong dividend
histories (where appropriate), high management stock ownership and
ability to grow in a stagnant economic environment and thrive as the
economy improves; (2) "buy with discipline" those companies with low
absolute and comparative price-to-earnings ratios, low price-to-book
value and low price relative to the company's industrial value as the
same may be viewed by a strategic acquirer; (3) "sell with
discipline" those companies whose price-to-earnings ratio has risen to
a premium, corporate fundamentals change or stock prices rise above
the target price. Further, AWAD seeks portfolio construction in four
conceptual areas: core growth holdings, restructured companies
demonstrating renewed growth, emerging companies and strategic
acquisition candidates in consolidating industries.
AWAD's Investment Advisory Board. AWAD utilizes the expertise of an
investment advisory board which meets regularly to review results and corporate
and investment strategy. Members are James D. Awad, Dennison T. Veru, Thomas A.
James, Chairman, Raymond James Financial, Inc. and Thomas Barry, President and
Chief Executive Officer, Zephyr Management, Inc. and past President, Rockefellar
& Co.
AWAD's Principal Executive Officers.
<TABLE>
<CAPTION>
<S> <C> <C> <C>
Name and Title Name of Company and Principal Occupation
with AWAD Principal Business Address
James D. Awad Awad & Associates Chairman and Chief
477 Madison Avenue
Investment Officer
New York, New York 10022
Dennison T. Veru Awad & Associates President
477 Madison Avenue
New York, New York 10022
John P. Middleton Awad & Associates Vice President
477 Madison Avenue
New York, New York 10022
Paul Kleinberg Awad & Associates Portfolio Manager
477 Madison Avenue
New York, New York 10022
Nicholas R. Pontikes Awad & Associates Equity Research Analyst
477 Madison Avenue
New York, New York 10022
</TABLE>
The Proposed Investment Subadvisory Agreement. The proposed
Investment Subadvisory Agreement (the "Subadvisory Agreement")
between the Advisor and AWAD, reproduced in Appendix B, contains
substantially the same terms as governed the Advisor's previous arrangement
with PASI, except as described below. If approved by shareholders,
the Subadvisory Agreement will continue to January 1, 1999 unless
terminated earlier by either party, and will continue thereafter on
an annual basis if approved by the Directors or shareholders and a
majority of the Directors who are not interested persons of the Fund,
Advisor or Subadvisor. Until shareholders approve the new Subadvisory
Agreement, CAMCO may compensate AWAD 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 PASI under the prior arrangement** If shareholders do not
approve the 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.
**Pursuant 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 Directors 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.
As with the arrangement between the Advisor and PASI, AWAD's fee for
subadvisory services will be paid by the Advisor. However, whereas the Advisor
paid PASI an annual fee based upon the Portfolio's average daily net assets plus
or minus a performance adjustment, the Advisor will pay AWAD a fee with no
performance adjustment. Specifically, the proposed fee schedule appended to the
proposed investment subadvisory agreement with AWAD calls for a fee, payable
monthly, consisting of a Base Fee of 0.40% of the CRI Strategic Growth
Portfolio's average daily net assets.
Under the previous arrangement, PASI was paid 0.90% of average daily
net assets and the Advisor could adjust this fee based on the extent
to which performance of the Fund exceeded or trailed the Russell 2000
Index:
<TABLE>
<CAPTION>
<S> <C> <C>
Performance versus the Performance Fee
Russell 2000 Index Adjustment
30% to less than 60% 0.025%
60% to less than 90% 0.050%
90% or more 0.075%
</TABLE>
Comparison Of Subadvisory Fees.
Investment Subadvisory Proposed Investment
Agreement with Portfolio Subadvisory Agreement with
Advisory Services, Inc. Awad & Associates
________________________ __________________________
0.95% on all Portfolio assets 0.40% on all Portfolio assets
plus a performance adjustment
of plus/minus 0.075% basis points
Based on its evaluation of the materials presented and assisted by
the advice of independent counsel, the Board of Directors concluded
that the proposed investment subadvisory agreement with AWAD is in
the best interest of the Portfolio's shareholders. The Board of
Directors voted to approve the submission of the Investment
Subadvisory Agreement to shareholders of the Portfolio and recommends
that shareholders vote FOR the Subadvisory Agreement.
III. To approve new investment objective, policies and restrictions
for the Portfolio.
The Board has proposed that the Portfolio's investment objective,
policies and restrictions be changed. The current investment
objective and related policy of the Portfolio is:
To seek maximum long-term growth through investments
primarily in the equity securities of companies that have
little or no debt, high relative strength and substantial
management ownership. The Portfolio is designed to provide
long-term growth of capital by investing in enterprises that
make a significant contribution to society through their
products and services and through the way they do business.
The Portfolio considers issuers of all sizes, industries,
and geographic markets, and does not seek interest income or
dividends. In selecting equity investments, the Portfolio
focuses on individual companies by screening over seven
thousand stocks traded on all major U.S. stock exchanges in
addition to stocks traded on the NASDAQ National Market
System.
While continuing to seek capital appreciation, if approved, the new
investment objective and related policy of the Portfolio would be:
To achieve long-term capital appreciation by investing
primarily in the equity securities of small companies
publicly traded in the United States. In seeking capital
appreciation, the Fund would invest primarily in the equity
securities of small capitalized growth companies (including
American Depositary Receipts ("ADRs")) that have
historically exhibited exceptional growth characteristics
and that, in the Adviser's opinion, have strong earnings
potential relative to the U.S. market as a whole.
Though maintaining investments in equity securities, the Portfolio's focus
under the new investment objective would be on a narrower subset of small
capitalized growth companies, currently those companies with a total
capitalization of less than $1 billion at the time of the Portfolio's initial
investment.
While any investment in securities carries a certain degree of risk, the
approach of the CRI Strategic Growth Portfolio is designed to maximize growth
in relation to the risks assumed. The securities of small cap users may be
less actively traded than the securities of larger issuers, may trade in a
more limited volume, and may change in value more abruptly than securities
of larger companies. Information concerning these securities may not be
readily available so that the companies may be less actively followed by
stock analysts. Small-cap issuers do not usually participate in market
rallies to the same extent as more widely-known securities, and they tend to
have a relatively higher percentage of insider ownership.
Investing in smaller, new issuers generally involves greater risk than
investing in larger, established issuers. Companies in which the CRI Strategic
Growth Portfolio is likely to invest may have limited product lines, markets or
financial resources and may lack management depth. The securities in such
companies may also have limited marketability and may be subject to more abrupt
or erratic market movements than securities of larger, more established
companies or the market averages in general.
If approved, the investment policies would remain the same except
that the Portfolio could no longer use options and futures contracts
to increase or decrease its exposure to changing security prices,
interest rates, or other factors that affect security values, except
only in extraordinary circumstances. Whereas the Portfolio does not
presently invest in foreign securities, although it may do so in the
future; it would not be permitted to invest in foreign securities at
all. Similarly, the Portfolio would no longer invest in precious
metals.
Similarly, the fundamental investment restrictions would remain the
same, except that with respect to 75% of the Portfolio's total
assets, the Portfolio could 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 its total assets would be invested in securities of that
issuer; whereas this restriction currently applies to only 50% of its
total assets.
The non-fundamental investment restrictions would also remain the same,
except that the Portfolio would not be restricted in its investment in the
securities of issuers restricted from selling to the public without registration
under the Securities Act of 1933, excluding restricted securities eligible for
resale pursuant to Rule 144A under that statute whereas currently it may invest
no more than 5% of its net assets in such securities. Under the proposal, the
Portfolio would also change from a nondiversified to a diversified fund.
The same social criteria will continue to be applied to the portfolio's
investments.
Although the investment objective is non-fundamental, understanding
the importance of a Portfolio's investment objective, and recognizing
the fundamental investment policies oft he Portfolio, the Board of
Directors determined it would submit all of the proposed changes for
approval by shareholders.
The Board of Directors voted to approve the submission of the
proposal to shareholders of the Fund and recommends that shareholders
vote FOR the Proposal.
IV. To approve the Fund and the Advisor entering into and
materially amending the investment subadvisory agreement in the
future without shareholder approval.
The Securities and Exchange Commission has granted the Fund an exemptive
order to allow it to enter into and materially amend the Investment Subadvisory
Agreement without shareholder approval with respect to the Portfolio. Management
believes that the Advisor's constant supervision of the subadvisor will permit
the subadviser to be replaced in response to changing market conditions or
subadvisor performance, in an attempt to improve the Portfolio's overall
performance. In essence, shareholder approval would permit the Advisor to select
the subadvisor best suited to achieve the Portfolio's investment objective.
In the past, Management has found that requiring shareholder approval of a
subadvisor and investment subadvisory agreement imposed costs on the 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 Directors. Further, Management believes that it has
become increasingly difficult to obtain shareholder quorums for shareholder
meetings. Without shareholder approval of this proposal, Management believes
that the CRI Strategic Growth Portfolio could be left with an ineffective
subadvisor while awaiting shareholder approval. Management also believes that
requiring shareholder approval of a new subadvisor and amendments to the
Investment Subadvisory Agreement would prevent the Fund from promptly and timely
employing the subadvisor best suited to the needs of the CRI Strategic Growth
Portfolio.
If approved, Management would, in turn, provide shareholders with
information about any new subadvisor. The Prospectus and Statement of
Additional Information would be revised to disclose all required
information regarding the subadvisor. Within 90 days of the hiring of
the subadvisor or the implementation of any proposed material change
in the Investment Subadvisory Agreement, the Portfolio would furnish
its shareholders information about the new subadvisor or change in
the Investment Subadvisory Agreement that would be included in a
proxy statement. Such information would include any change in such
disclosure caused by the addition of a new subadvisor or any proposed
material change in the Investment Subadvisory Agreement of the Fund.
The Fund anticipates meeting this condition by providing
shareholders, within 90 days of the hiring of the subadvisor or
implementation of any material change to the terms of the Investment
Subadvisory Agreement, with an information statement to this effect.
Management recommend approval of the ability to enter into and materially
amend the Investment Subadvisory Agreement without shareholder approval to the
Board of Directors, and at a meeting of the Board of Directors held on September
9, 1997, the Board approved Management's recommendation. The Board has
determined that shareholders may benefit from the Advisor using its own
expertise in selecting the subadvisor best suited to achieve the CRI Strategic
Growth Portfolio's investment objective without shareholder approval.
The Board of Directors have voted to approve the submission of the proposal
to shareholders of the CRI Strategic Growth Portfolio and recommends that
shareholders vote FOR the Proposal.
OTHER BUSINESS
The Directors 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
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
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.,
Secretary, 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.
Proxies are solicited by mail. 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. CRI Strategic Growth Portfolio will bear solicitation costs.
Shareholders of CRI Strategic Growth Portfolio of record at the close of
business on October 15, 1997 ("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. As of October 15, 1997, as shown on
the books of CRI Strategic Growth Portfolio, there were issued and outstanding
299,964.486 shares of CRI Strategic Growth Portfolio. To the knowledge of the
Fund, no shareholder owned beneficially more than 5% of the outstanding shares
of the CRI Strategic Growth Portfolio on that date.
This Proxy Statement is expected to be mailed to shareholders of
record on or about October 24, 1997.
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 Directors
William M. Tartikoff, Esq.
Secretary
The Directors of Acacia Capital Corporation CRI Strategic Growth
Portfolio, including the Independent Directors, recommend a Vote for
Approval of the Proposals presented.
<PAGE>
ACACIA CAPITAL CORPORATION:
CALVERT RESPONSIBLY INVESTED STRATEGIC GROWTH PORTFOLIO
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS
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 CRI Strategic Growth 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 Tuesday, December 2, 1997 at
10:00 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 proposal
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: ________________________, 1997
__________________________________
__________________________________
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.
<PAGE>
THE BOARD OF DIRECTORS 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 existing agreement in all material
respects, except that it: (a) reflects a new fee structure
and (b) does not provide for a performance fee.
[ ] For [ ] Against [ ] Abstain
2. To approve a new investment subadvisory agreement with the
investment subadvisor, Awad & Associates, identical to the
existing agreement in all material respects, except that it: (a)
reflects a new fee structure and (b) does not provide for a
performance fee.
[ ] For [ ] Against [ ] Abstain
3. To approve new investment objective, policies and
restrictions for the Portfolio.
[ ] For [ ] Against [ ] Abstain
4. To approve the Fund and the Advisor entering into and
materially amending the investment subadvisory agreement in the
future without shareholder approval.
[ ] For [ ] Against [ ] Abstain
<PAGE>
APPENDIX A
INVESTMENT ADVISORY AGREEMENT
17
INVESTMENT ADVISORY AGREEMENT between
ACACIA CAPITAL CORPORATION and
CALVERT ASSET MANAGEMENT COMPANY, INC.
AGREEMENT, made as of Jun 30, 1992, by and between
ACACIA CAPITAL CORPORATION, a corporation organized and existing
under the laws of the State of Maryland (the "Fund"), and
CALVERT ASSET MANAGEMENT COMPANY, INC., a corporation organized
and existing under the laws of the State of Delaware (the
"Advisor").
WITNESSETH:
WHEREAS, the Fund proposes to engage in business as an open-end
management investment company and to register as such under the
federal Investment Company Act of 1940, as amended (the "Act");
and
WHEREAS, the Fund is authorized to issue shares ("Shares") in
certain series of the Fund, as indicated in Schedule A (the
"Portfolios"), and any other series designated by the Fund in
the future; and
WHEREAS, the Advisor is engaged principally in the business of
rendering investment supervisory services and is registered as
an investment advisor under the federal Investment Advisors Act
of 1940, as amended; and
WHEREAS, the Fund desires the Advisor to render investment
supervisory services to the Fund in the manner and on the terms
and conditions set forth in this Agreement;
NOW, THEREFORE, in consideration of the mutual promises set
forth in this Agreement, the parties hereto agree as follows:
1. Duties and Responsibilities of Advisor.
A. Investment Advisory Services. The
Advisor will act as investment advisor and
will supervise and direct the investments
of the Portfolios in accordance with their
investment objectives, program and
restrictions as provided in the
prospectus, on behalf of the Fund, as
amended from time to time, and such other
limitations as the Fund may impose by
notice in writing to the Advisor. The
Advisor will obtain and evaluate such
information relating to the economy,
industries, businesses, securities markets
and securities as it may deem necessary or
useful in the discharge of its obligations
hereunder and will formulate and implement
a continuing program for the management of
the assets and resources of the Fund in a
manner consistent with its investment
objectives. In furtherance of this duty,
the Advisor, as agent and attorney-in-fact
with respect to the Fund, is authorized,
in its discretion and without prior
consultation with the Fund, to:
(i) buy, sell, exchange, convert,
lend, and otherwise trade in any
stocks, bonds, and other
securities or assets; and
(ii) directly or through the
trading desks of the Advisor and
its affiliates place orders and
negotiate the commissions (if any)
for the execution of transactions
in securities with or through such
brokers, dealers, underwriters or
issuers as the Advisor may select.
B. Financial, Accounting, and Administrative
Services. The Advisor will assist the
Fund's Administrator in maintaining the
existence and records of the Fund; assist
the Administrator in maintaining the
registrations and qualifications of Fund
Shares under federal and state law;
monitoring the financial, accounting, and
administrative functions of the Fund;
maintaining liaison with the various
agents employed for the benefit of the
Fund by the Fund (including the Fund's
transfer agent, custodian, independent
accountants and legal counsel) and assist
in the coordination of their activities on
behalf of the Fund.
C. Reports to Fund. The Advisor will
furnish to or place at the disposal of the
Fund such information, reports,
evaluations, analyses and opinions as the
Fund may, at any time or from time to
time, reasonably request or as the Advisor
may deem helpful.
D. Reports and Other Communications to
Shareholders. The Advisor will develop
all general shareholder communications,
including regular shareholder reports.
E. Fund Personnel. The Advisor agrees to
permit individuals who are officers or
employees of the Advisor to serve (if duly
elected or appointed) as officers,
directors, members of any committee of
directors, members of any advisory board,
or members of any other committee of the
Fund, without remuneration or other costs
to the Fund.
F. Personnel, Office Space, and Facilities
of Advisor. The Advisor at its own
expense will furnish or provide and pay
the cost of such office space, office
equipment, office personnel, and office
services as the Advisor requires in the
performance of its investment advisory and
other obligations under this Agreement.
2. Allocation of Expenses
A. Expenses Paid by Advisor.
(1) Salaries and Fees of Officers.
The Advisor will pay all salaries,
expenses, and fees of the officers
and directors of the Fund who are
affiliated with the Advisor.
(2) Assumption of Expenses by
Advisor. The payment or
assumption by the Advisor of any
expense of the Fund that the
Advisor is not required by this
Agreement to pay or assume will
not obligate the Advisor to pay or
assume the same or any similar
expense on any subsequent occasion.
B. Expenses Paid by Fund. The Fund will
bear all expenses of its organization,
operations, and business not specifically
assumed or agreed to be paid by the
Advisor as provided in this Agreement. In
particular, but without limiting the
generality of the foregoing, the Fund will
pay:
(1) Custody and Accounting Services.
All expenses of the transfer,
receipt, safekeeping, servicing
and accounting for the cash,
securities, and other property of
the Fund, for the benefit of the
Fund, including all charges of
depositories, custodians, and
other agents, if any;
(2) Shareholder Servicing. All
expenses of maintaining and
servicing shareholder accounts,
including all charges for
transfer, shareholder record
keeping, dividend disbursing,
redemption, and other agents for
the benefit of the Fund, if any;
(3) Shareholder Communications. All
expenses of preparing; setting in
type, printing, and distributing
reports and other communications
to shareholders;
(4) Shareholder Meetings. All
expenses incidental to holding
meetings of shareholders,
including the printing of notices
and proxy material, and proxy
solicitation therefor;
(5) Prospectuses. All expenses of
preparing, setting in type, and
printing of annual or more
frequent revisions of the
prospectus and of mailing them to
shareholders;
(6) Pricing. All expenses of
computing the Fund's net asset
value per share, including the
cost of any equipment or services
used for obtaining price
quotations;
(7) Communication Equipment. All
charges for equipment or services
used for communication between the
Advisor or the Fund or Fund and
the custodian, transfer agent or
any other agent selected by the
Fund;
(8) Legal and Accounting Fees and
Expenses. All charges for
services and expenses of the
Fund's legal counsel, including
counsel to the disinterested
Directors of the Fund, and
independent auditors for the
benefit of the Fund;
(9) Directors' Fees and Expenses.
All compensation of directors,
other than those affiliated with
the Advisor, and all expenses
incurred in connection with their
service;
(10) Federal Registration Fees.
All fees and expenses of
registering and maintaining the
registration of the Fund under the
Act and the Registration of the
Fund Shares under the Securities
Act of 1933, as amended (the "33
Act"), including all fees and
expenses incurred in connection
with the preparation, setting in
type, printing, and filing, of any
registration statement and
prospectus under the 33 Act or the
Act, and any amendments or
supplements that may be made from
time to time;
(11) State Registration Fees.
All fees and expenses of
qualifying and maintaining
qualification of the Fund and of
Fund Shares for sale under
securities laws of various states
or jurisdictions, if any, and of
registration and qualification of
the Fund under all other laws
applicable to the Fund or its
business activities (including
registering the Fund as a
broker-dealer, or any officer of
the Fund or any person as agent or
salesman of the Fund in any state);
(12) Issue and Redemption of Fund
Shares. All expenses incurred in
connection with the issue,
redemption, and transfer of
Portfolio Shares, including the
expense of confirming all
Portfolio Share transactions, and
of preparing and transmitting the
Portfolio's stock certificates;
(13) Bonding and Insurance. All
expenses of bond, liability, and
other insurance coverage required
by law or deemed advisable by the
board of directors;
(14) Brokerage Commissions. All
brokers' commissions and other
charges incident to the purchase,
sale, or lending of a Portfolio's
securities;
(15) Taxes. All taxes or
governmental fees payable by or
with respect of the Fund to
federal, state, or other
governmental agencies, domestic or
foreign, including stamp or other
transfer taxes;
(16) Trade Association fees. All
fees, dues, and other expenses
incurred in connection with the
Fund's membership in any trade
association or other investment
organization; and
(17) Nonrecurring and
Extraordinary Expenses. Such
nonrecurring expenses as may
arise, including the costs of
actions, suits, or proceedings to
which the Fund is a party and the
expenses the Fund may incur as a
result of its legal obligation to
provide indemnification to its
officers, directors, and agents.
3. Advisory Fees. For its services pursuant to this
Agreement, the Fund will pay the Advisor an annual
fee, based on the value of the net assets of the
applicable Portfolio. The fee is set forth in
Schedule A. The Schedule may be amended from time
to time. Any change in the Schedule relating to
any new or existing Portfolios will not require the
approval of shareholders of any other Portfolio.
A. Method of Computation. The fee will be
accrued for each calendar day and the sum
of the daily fee accruals will be paid
monthly to the Advisor on the first
business day of the next succeeding
calendar month. The daily fee accruals
will be computed by multiplying the
fraction of one over the number of
calendar days in the year by the
applicable annual rate described above in
this Paragraph 3, and multiplying this
product by the net assets of the
Portfolios as determined in accordance
with the prospectus as of the close of
business on the previous business day on
which the Fund was open for business.
B. Expense Limitation. To the extent that
the aggregate expenses incurred by any
Portfolio of the Fund in any fiscal year,
including but not limited to fees of the
Advisor computed as hereinabove set forth,
but excluding interest, taxes, brokerage
and other expenditures which are
capitalized in accordance with generally
accepted accounting principles and
extraordinary expenses, will exceed the
limit ("State Expense Limit") of any state
in which that Portfolios' shares are
qualified for sale, the Advisor will waive
its fee to the extent that its fee causes
the total expenses of the respective
Portfolio to exceed the State Expense
Limit.
C. Proration of Fee. If this Agreement
becomes effective or terminates before the
end of any month, the fee for the period
from the effective date to the end of such
month or from the beginning of such month
to the date of termination, as the case
may be, will be prorated according to the
proportion which such period bears to the
full month in which such effectiveness or
termination occurs.
D. Fee Waiver and Recapture of Waived Fees and
Reimbursed Expenses.
(1) As part of the consideration for the
Fund entering into this Agreement with
respect to the Portfolios, the Advisor
hereby agrees that through December 31,
1992, it will waive current payment of its
entire fee for the Portfolios until net
assets are at least $20 million, and waive
current payment of half of its fee for the
Portfolios while net assets are more than
$20 million by less than $40 million; and
the Advisor may, but is not required to by
this Agreement, further waive current
payment of its fees by the Portfolios, or
to reimburse the Portfolios' expenses
beyond any reimbursement required by the
State Expense Limit; provided, however,
that (a) any fees the current payment of
which is waived by the Advisor and any
expenses paid on behalf of or reimbursed
to the Portfolios by the Advisor through
December 31, 1992, may be recaptured by
the Advisor from the Portfolios during the
two-year period beginning on January 1,
1993, and ending on December 31, 1994; and
(b) such recapture will only be made to
the extent that it does not result in the
Portfolios' aggregate expenses exceeding
an annual expenses limit of 2.00% of the
Portfolios' average daily net assets
(1.10% for the Money Market Portfolio).
(2) The Advisor may voluntarily agree to
additional fee waivers or expense
reimbursements with respect to the
Portfolios from January 1, 1993 through
December 31, 1994, ("Additional Period");
provided, however, that: (a) any fees the
current payment of which is waived by the
Advisor and any expenses paid on behalf of
or reimbursed to the Portfolios by the
Advisor during the Additional Period may
be recaptured by the Advisor from the
Portfolios during the two-year period
beginning on January 1, 1995 and ending on
December 31, 1996 and (b) such recapture
will only be made to the extent that it
does not result in the Portfolios'
aggregate expenses exceeding an annual
expense limit of 2.00% of their daily net
assets (1.10% for the Money Market
Portfolio).
4. Brokerage. Subject to the approval of the Fund's
Board of Directors, the Advisor, in carrying out
its duties under Paragraph 1A, may cause the Fund,
with respect to the Fund or any of its Portfolios,
to pay a broker-dealer which furnishes brokerage or
research services, as such services are defined
under Section 28(e) of the Securities Exchange Act
of 1934, as amended (the "34 Act") or
formal/informal staff opinions a higher commission
than that which might be charged by another
broker-dealer which does not furnish brokerage or
research services or which furnishes brokerage or
research services deemed to be of lesser value, if
such commission is deemed reasonable in relation to
the brokerage and research services provided by the
broker-dealer, viewed in terms of either that
particular transaction or the overall
responsibilities of the Advisor with respect to the
accounts as to which it exercises investment
discretion (as such term is defined under Section
3(a)(35) of the '34 Act or rules).
5. Advisor's Use of the Services of Others. The
Advisor may (at its cost except as contemplated by
Paragraph 4 of this Agreement) employ, retain or
otherwise avail itself of the services or
facilities of other persons or organizations, for
the purpose of performing its obligations
hereunder. The Advisor may (at its cost except as
contemplated by paragraph 4 of this Agreement)
retain a subadvisor for the Fund, with the approval
of the Fund's Board of Directors. The Advisor
shall be responsible for the oversight of such
persons in fulfilling its obligations hereunder.
6. Ownership of Records. All records required to be
maintained and preserved by the Fund pursuant to
the provisions of rules or regulations of the
Securities and Exchange Commission under Section
31(a) of the Act and maintained and preserved by
the Advisor on behalf of the Fund are the property
of the Fund, and will be surrendered by the Advisor
promptly on request by the Fund.
7. Reports to Advisor. The Fund will furnish or
otherwise make available to the Advisor such
prospectuses, financial statements, proxy
statements, reports, and other information relating
to the business and affairs of the Fund as the
Advisor may, at any time or from time to time,
reasonably require in order to discharge its
obligations under this Agreement.
8. Services to Other Clients. Nothing herein
contained will limit the freedom of the Advisor or
any affiliated person of the Advisor to render
investment supervisory and corporate administrative
services to other investment companies, to act as
investment advisor or investment counselor to other
persons, firms or corporations, or to engage in
other business activities; but so long as this
Agreement or any extension, renewal or amendment
hereof will remain in effect or until the Advisor
will otherwise consent, the Advisor will be the
only investment advisor to the Fund.
9. Limitation of Liability of Advisor. Neither the
Advisor nor any of its officers, directors, or
employees, nor any person performing executive,
administrative, trading, or other functions for the
Fund (at the direction or request of the Advisor)
or the Advisor in connection with the Advisor's
discharge of its obligations undertaken or
reasonably assumed with respect to this Agreement,
will be liable for any error of judgment or mistake
of law or for any loss suffered by the Fund in
connection with matters to which this Agreement
relates, except for loss resulting from willful
misfeasance, bad faith, or gross negligence in the
performance of its or his or her duties on behalf
of the Fund or from reckless disregard by the
Advisor or any such person of the duties of the
Advisor under this Agreement.
10. Use of Advisor's Name. The Fund may use the
name "Calvert Asset Management Company, Inc." only
with the approval of the Advisor and only for so
long as this Agreement or any extension, renewal or
amendment hereof remains in effect, including any
similar agreement with any organization which will
have succeeded to the business of the Advisor as
investment advisor.
11. Term of Agreement. The term of this Agreement
will begin on the date first above written, and
unless sooner terminated as hereinafter provided,
will remain in effect until January 1, 1994.
Thereafter, this Agreement will continue in effect
from year to year, with respect to the Fund,
subject to the termination provisions and all other
terms and conditions hereof, so long as such
continuation will be specifically approved at least
annually (a) by either the Board of Directors of
the Fund, or by vote of a majority of the
outstanding voting securities of the Fund; (b) in
either event by the vote, cast in person at a
meeting called for the purpose of voting on such
approval, of a majority of the directors of the
Fund, with respect to the Fund, who are not parties
to this Agreement or interested persons of any such
party; and ( c) The Advisor will not have notified
the Fund, in writing, at least 60 days prior to
December 31, 1993 or prior to March 10 of any year
thereafter, that it does not desire such
continuation. The Advisor will furnish to the
Fund, promptly upon its request, such information
as may reasonably be necessary to evaluate the
terms of the Agreement or any extension, renewal or
amendment hereof.
12. Amendment and Assignment of Agreement. This
Agreement may be amended by the parties subject to
federal regulatory requirements. This Agreement
may not be assigned without the affirmative vote of
a majority of the outstanding voting securities of
the Fund, or if such assignment relates only to a
particular Portfolio of the Fund, without the
affirmative vote of a majority of the outstanding
voting securities of that Portfolio. This
Agreement will automatically and immediately
terminate in the event of its assignment.
13. Termination of Agreement. This Agreement may
be terminated by either party hereto, without the
payment of any penalty, upon 60 days' prior notice
in writing to the other party; provided, that in
the cases of termination by the Fund, with respect
to the Fund, such action will have been authorized
by resolution of a majority of the directors who
are not parties to this Agreement or interested
persons of any such party, or by vote of a majority
of the outstanding voting securities of the Fund.
14. Miscellaneous.
A. Captions. The captions in this Agreement
are included for convenience of reference
only and in no way define or delineate any
of the provisions hereof or otherwise
affect their construction or effect.
B. Interpretation. Nothing herein contained
will be deemed to require the Fund to take
any action contrary to its Articles of
Incorporation or Bylaws, or any applicable
statutory or regulatory requirement to
which it is subject or by which it is
bound, or to relieve or deprive the board
of directors of the Fund of its
responsibility for and control of the
conduct of the affairs of the Fund. This
Agreement will be construed and enforced
in accordance with and governed by the
laws of the State of Maryland.
C. Definitions. Any question of
interpretation of any term or provision of
this Agreement having a counterpart in or
otherwise derived from a term or provision
of the Act will be resolved by reference
to such term or provision of the Act and
to interpretations thereof, if any, by the
United States courts or, in the absence of
any controlling decision of any such
court, by rules, regulations or orders of
the Securities and Exchange Commission
validly issued pursuant to the Act.
Specifically, the terms "vote of a
majority of the outstanding voting
securities," "interested person,"
assignment," and "affiliated person" as
used in Paragraphs 2, 8, 10, 11, and 12
hereof, will have the meanings assigned to
them by Section 2(a) of the Act. In
addition, where the effect of a
requirement of the Act reflected in any
provision of this Agreement is relaxed by
a rule, regulation or order of the
Securities and Exchange Commission,
whether of special or of general
application, such provision will be deemed
to incorporate the effect of such rule,
regulation or order.
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be signed by their respective officers thereunto
duly authorized and their respective corporate seals to be
hereunto affixed, as of the day and year first above written.
Attest: ACACIA CAPITAL CORPORATION
_____________________________ BY:____________________________
Secretary William M.Tartikoff
Attest: CALVERT ASSET MANAGEMENT
COMPANY, INC.
_____________________________ BY:_______________________________
Secretary Reno J. Martini
SCHEDULE A
ACACIA CAPITAL CORPORATION
Calvert Asset Management Company, Inc., acting as
investment advisor to Acacia Capital Corporation, is entitled to
be paid the fees indicated below based on the average daily net
assets of each portfolio, subject to Section 3(D) of this
Agreement.
Money Market Portfolio:
0.50% of the value of the first $250 million
0.475% of the next $250 million; and
0.45% of assets over $500 million
Global Portfolio:
1.00% of the value of the first $250 million
0.975% of the next $250 million; and
0.925% of assets over $500 million
Capital Accumulation Portfolio:
0.80% of the value of the Portfolio's average daily net assets
* plus or minus a performance adjustment as detailed in schedule C
Strategic Growth Portfolio:
0.90% of the value of the Portfolio's average daily net assets
Balanced Portfolio (as of April 5, 1995):
0.70% of the value of the first $500 million
0.65% of the next $500 million
0.60% of assets over $1 billion
* plus or minus a performance adjustment as detailed in schedule E
Restated October, 1997
<PAGE>
APPENDIX B
INVESTMENT SUBADVISORY AGREEMENT
INVESTMENT SUBADVISORY AGREEMENT, effective 1st day of
October 1997, by and between Calvert Asset Management Company, Inc.,
a Delaware corporation registered as an investment adviser under the
Investment Advisers Act of 1940 (the "Adviser"), and AWAD Associates,
a division of Raymond James and Associates, Inc. a Florida
corporation (the "Subadviser").
WHEREAS, the Adviser is the investment adviser to Acacia
Capital Corporation, Calvert Responsibly Invested Strategic Growth
Portfolio (the "Fund"), an open-end, diversified management
investment company registered under the Investment Company Act of
1940, as amended (the "1940 Act");
WHEREAS, the Adviser desires to retain the Subadviser to
furnish it with certain investment advisory services in connection
with the Adviser's investment advisory activities on behalf of the
Fund and any additional series of Acacia Capital Corporation for
which Schedules are attached hereto (each such series also referred
to individually as the "Fund");
WHEREAS, the policyholders of the Fund will be requested to
authorize the appointment of the Subadviser, as the investment
subadviser; and
NOW, THEREFORE, in consideration of the promises and the
terms and conditions hereinafter set forth, it is agreed as follows:
1. Services to be Rendered by the Subadviser to the
Fund.
(a) Investment Program. Subject to the
control of the Fund Board of Directors ("Directors") and the
Adviser, the Subadviser at its expense continuously will
furnish to the Fund an investment program for such portion,
if any, of Fund assets designated by the Adviser from time
to time. With respect to such assets, the Subadviser will
make investment decisions, which are subject to Section 1(g)
of this Agreement, and will place all orders for the
purchase and sale of portfolio securities. The Subadviser
will for all purposes herein be deemed to be an independent
contractor and shall, except as expressly provided or
authorized, have no authority to act for or represent the
Fund or the Adviser in any way or otherwise be deemed an
agent of the Fund or the Adviser. In the performance of its
duties, the Subadviser will act in the best interests of the
Fund and will in conjunction with the Adviser, comply with
(i) applicable laws and regulations, including, but not
limited to, the 1940 Act, and Section 817(h) and Subchapter
M of the Internal Revenue Code of 1986, as amended, (ii) the
terms of this Agreement, (iii) the Fund's Articles of
Incorporation, 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 Directors or Adviser may
establish. The Adviser shall be responsible for providing
the Subadviser with current copies of the materials
specified in Subsections (a)(iii), (iv), (v) and (vi) of
this Section 1.
(b) Availability of Personnel.The Subadviser
at its expense will make available to the Directors and
Adviser at reasonable times its portfolio managers and other
appropriate personnel, either in person, or, by telephone,
in order to review the Fund's investment policies and to
consult with the Directors and Adviser regarding the Fund's
investment affairs, including economic, statistical and
investment matters relevant to the Subadviser's duties
hereunder, and will provide periodic reports to the Adviser
relating to the investment strategies it employs.
(c) Expenses, Salaries and Facilities. The
Subadviser 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), 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 Subadviser at its
expense will provide the Adviser with such compliance
reports relating to its duties under this Agreement as may
be agreed upon by such parties from time to time.
(e) Valuation. The Subadviser 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
Subadviser has responsibility on a daily basis (unless
otherwise agreed upon by the parties hereto) and at such
other times as the Adviser 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 Subadviser
will use its best efforts to obtain the
most favorable price and execution
available in accordance with this
paragraph. The Subadviser agrees to
provide the Adviser and the Fund with
copies of its policy with respect to
allocation of brokerage on trades for the
Fund. Subject to review by the Directors
of appropriate policies and procedures,
the Subadviser 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 first broker provided
brokerage and/or research services,
including statistical data, to the
Subadviser, the Subadviser 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
Subadviser 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 Subadviser 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. The Adviser may direct the
Subadviser in writing to use a particular
broker or dealer for one or more trades
if, in the sole opinion of the Adviser, it
is in the best interest of the Fund to do
so.
(g) Social Screening. The Adviser is
responsible for screening those investments 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
Directors. The Subadviser will buy only those Securities
which the Adviser determines pass the Fund's social screens.
(h) Voting Proxies. The Subadviser agrees to
take appropriate action (which includes voting) on all
proxies for the Fund's portfolio investments in a timely
manner. Such action is subject to the direction of the
Directors and Adviser and will be consistent with the social
screens and criteria governing investment selection for the
Fund.
(i) Furnishing Information for the Fund's
Proxies and Other Required Mailings. The Subadviser agrees
to provide the Adviser in a timely manner with all
information necessary, including the Subadviser's certified
balance sheet and information concerning the Subadviser's
controlling persons, for preparation of the Fund's proxy
statements or other required mailings, as may be needed from
time to time.
<PAGE>
2. Books, Records and Miscellaneous Matters.
(a) In connection with the purchase and sale
of the Fund's portfolio securities, the Subadviser shall
arrange for the transmission to the Fund's custodian, and/or
the Adviser on a daily basis, of such confirmations, trade
tickets or other documentation as may be necessary to enable
the Adviser 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 Advisers Act of 1940 and any
other laws, rules or regulations regarding recordkeeping,
the Subadviser 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 Adviser any such records
upon the Fund's or Adviser's request; (iii) it will maintain
for the Fund the records that the Fund is required to
maintain under Rule 31a-1(b) insofar as such records relate
to the investment affairs of the Fund for which the
Subadviser 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 Subadviser 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 Subadviser shall supply to the
Directors its policies on "soft dollars", trade allocations
and brokerage allocation procedures. The Subadviser 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 this
Agreement, the Subadviser will not provide investment advisory
services ("Services") to any other portfolio of an investment company
registered under the 1940 Act except to the extent that, as of
September 1, 1997, the Subadviser has entered into a written
agreement(s) to provide such Services.
4. Compensation. The Adviser will pay to the
Subadviser as compensation for the Subadviser'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 payable for each month within 15
business days after the end of such month. If the Subadviser shall
serve for less than the whole of a month, the compensation as
specified shall be prorated. The Schedules may be amended from time
to time, provided that amendments are made in conformity with
applicable laws and regulations and the Articles of Incorporation and
Bylaws of the Fund. Any change in the Schedule pertaining to any new
or existing series of the Fund shall not be deemed to affect the
interest of any other series and shall not require the approval of
policyholders of any other series.
5. Assignment and Amendment of Agreement. This
Agreement automatically shall terminate without the payment of any
penalty in the event of its assignment or if the Investment Advisory
Agreement between the Adviser and the Fund shall terminate for any
reason. 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 Directors of the Fund who are not interested persons
of the Fund, the Adviser or the Subadviser.
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 series now existing or hereafter created unless it has first
been approved (a) by a vote of the majority of those Directors of the
Fund 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
series' outstanding voting securities. This Agreement shall remain
in full force and effect continuously thereafter (unless terminated
automatically as set forth in Section 5.) except as follows:
(a) The Fund 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
Adviser and the Subadviser. Such termination can be
authorized by the affirmative vote of a majority of the (i)
Directors of the Fund or (ii) outstanding voting securities
of the applicable series.
(b) This Agreement will terminate
automatically with respect to the Fund unless, by January 1,
1998, and at least annually thereafter, the continuance of
the Agreement is specifically approved by (i) the Directors
of the Fund or the policyholders of such series by the
affirmative vote of a majority of the outstanding shares of
such series, and (ii) a majority of the Directors of the
Fund, who are not interested persons of the Fund, Adviser or
Subadviser, 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 policyholders of any
series for their approval and such policyholders fail to
approve such continuance as provided herein, the Subadviser
may continue to serve hereunder in a manner consistent with
the 1940 Act and the rules and regulations thereunder.
(c) The Adviser 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 Subadviser, and the Subadviser
may at any time terminate this Agreement with respect to any
or all series by not less than 90 days written notice
delivered or mailed by registered mail, postage prepaid, to
the Adviser, unless otherwise mutually agreed in writing.
Upon termination of this Agreement with respect to any Fund,
the duties of the Adviser delegated to the Subadviser under this
Agreement with respect to such Fund automatically shall revert to the
Adviser.
7. Notification to the Adviser. The Subadviser
promptly shall notify the Adviser in writing of the occurrence of any
of the following events:
(a) the Subadviser 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 Subadviser is required to be registered as an
investment adviser in order to perform its obligations under
this Agreement;
(b) the Subadviser 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, involving the affairs of
the Fund;
(c) a violation of the Subadviser's Code of Ethics
is discovered and, again, when action has been taken to
rectify such violation; or
(d) any other event, including but not limited to,
a change in personnel or the addition or deletion of major
client(s) of the Subadviser that might affect the ability of
the Subadviser 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 Subadviser shall indemnify
and hold harmless the Adviser, the Fund and their respective
directors, officers and policyholders from any and all claims,
losses, expenses, obligations and liabilities (including reasonable
attorneys fees) arising or resulting from the Subadviser's willful
misfeasance, bad faith, negligence or reckless disregard of its
duties hereunder.
The Adviser shall indemnify and hold harmless the
Subadviser, the Fund, their respective directors, officers and
policyholders from any and all claims, losses, expenses, obligations
and liabilities (including reasonable attorneys fees) arising or
resulting from the Adviser's willful misfeasance, bad faith, gross
negligence or reckless disregard of its duties hereunder or under its
Investment Advisory Agreement with the Fund.
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. Confidentiality. This Agreement is not binding on
the Adviser unless the Subadviser has signed and is subject to a
confidentiality and non-use agreement ("Non-Use Agreement") not
materially different than the one attached hereto as Exhibit 1. For
a period of two (2) years from the date of termination of this
Agreement, the Subadviser shall not attempt to develop, market or
sell any product which uses or employs any Confidential Information,
as that term is defined in the Non-Use Agreement.
12. 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, or at such
other address or to such other person as a party may from time to
time specify in writing.
Subadviser 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 Adviser without the prior written
permission of the Adviser.
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.
<PAGE>
IN WITNESS WHEREOF, and have each caused this instrument to
be signed in duplicate on its behalf by its duly authorized
representative, all as of the day and year first above written.
Witness: Calvert Asset Management Company, Inc.
4550 Montgomery Avenue, Suite 1000N
Bethesda, Maryland 20814
BY:___________________________ BY:_________________________________
Witness: AWAD Associates, a division of Raymond
James and Associates, Inc.
By:___________________________ By:_________________________________
Fee Schedule to the Investment Subadvisory Agreement
between Calvert Asset Management Company, Inc.
and AWAD Associates
As compensation pursuant to Section 4 of the Investment
Subadvisory Agreement between Calvert Asset Management Company, Inc.
(the "Adviser") and AWAD Associates (the "Subadviser"), the Adviser
shall pay the Subadviser an annual subadvisory fee for the CRI
Strategic Growth Portfolio, a series of Acacia Capital Corporation,
computed daily and payable monthly, at an annual rate equal to 0.40%
of the average daily net assets of the Fund.
