File No. 811-3752
Rule 14(c)-5
June 7, 1999
VIA EDGAR
- ---------
Filing Desk Stop 1-4
Securities and Exchange Commission
Judiciary Plaza
450 Fifth Street, N.W.
Washington, DC 20549-1004
Re: The Managers Funds
File No. 811-3752
Definitive Information Statement
----------------------------------
Commissioners:
On behalf of The Managers Funds, a Massachusetts business
trust (the "Trust") registered as an open-end management
investment company under the Investment Company Act of 1940, as
amended (the "1940 Act"), enclosed for filing in accordance with
Rule 14(c)-5 under the Securities Exchange Act of 1934, as
amended (the "1934 Act"), is a definitive information statement
prepared for each series of the Trust (the "Funds"), with the
exception of Managers Intermediate Mortgage Fund and Managers
Money Market Fund. An information statement for Managers
Intermediate Mortgage Fund has been prepared, filed and mailed
under a separate cover.
This information statement has been prepared in accordance
with a Securities and Exchange Commission exemptive order
received by the Trust (Investment Company Release No. 21412, Oct.
11, 1995) which permits the Trust's manager to hire new sub-
advisers or to make changes to existing sub-advisory agreements
with the approval of the Trust's Trustees, but without
shareholder approval.
The recent acquisition of The Managers Funds, L.P. by
Affiliated Managers Group, Inc. (and its restructuring as The
Managers Funds LLC), resulted in the termination of the sub-
advisory agreements for each Fund of the Trust. Therefore, The
Managers Funds LLC executed new sub-advisory agreements on behalf
of each Fund, the terms of which are substantially identical to
the sub-advisory agreements in effect prior to the acquisition.
The Trust intends to mail definitive copies of this
information statement on or about June 7, 1999. Please direct
questions or comments regarding this filing to Judith L.
Shandling, Esq. of Swidler Berlin Shereff Friedman, LLP at (212)
891-9459.
Sincerely,
/s/Donald S. Rumery
Donald S. Rumery
Secretary
cc: Judith L. Shandling, Esq.
<PAGE>
SCHEDULE 14C INFORMATION
Information Statement Pursuant to Section 14(c)of the
Securities Exchange Act of 1934
(Amendment No. )
Check the appropriate box:
[ ] Preliminary Information Statement
[ ] Confidential, for Use of the Commission Only (as
permitted by Rule 14c-5(d)(2))
[ X ] Definitive Information Statement
_____________The Managers Funds______________
(Name of Registrant as Specified In Its Charter)
Payment of Filing Fee (Check the appropriate box):
[ ] $125 per Exchange Act Rules 0-11(c)(1)(ii),
or 14c-5(g).
[ ] Fee computed on table below per Exchange Act
Rules 14c-5(g) 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 (Set
forth the amount on which the filing fee is calculated
and state how it was determined):
__________________________________________________
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 offset as provided by
Exchange Act Rule 0-11(a)(2) and identify the filing for which
the offsetting fee was paid previously. Identify the previous
filing by registration statement number, or the Form or Schedule
and the date of its filing.
1) Amount Previously Paid:
______________________________________________________
2) Form, Schedule or Registration Statement No.:
______________________________________________________
3) Filing Party:
_______________________________________________________
4) Date Filed:
_______________________________________________________
[X] Filing fee no longer applicable.
<PAGE>
[LOGO FOR THE MANAGERS FUNDS]
June 7, 1999
Dear Shareholder of The Managers Funds:
In a proxy statement mailed on February 12, 1999, we asked
shareholders to approve an agreement between The Managers Funds,
L.P. and Affiliated Managers Group, Inc. ("AMG"). At a Special
Meeting held on March 31, 1999, the shareholders of the Funds
voted to approve that agreement, and on April 1, 1999, The
Managers Funds, L.P. closed its transaction with AMG. On April
1, 1999, The Managers Funds, L.P. converted to a Delaware limited
liability company (The Managers Funds LLC), and AMG acquired a
100% interest in its capital and a 95% interest in its profits.
Because this transaction involved a change of control of The
Managers Funds, L.P., The Managers Funds' (the "Trust's")
investment adviser, completion of this transaction terminated the
existing sub-advisory agreements executed on behalf of each Fund
of the Trust. Therefore, The Managers Funds LLC executed new sub-
advisory agreements dated April 1, 1999 with each sub-adviser
relating to its respective Fund of the Trust, the terms of which
are substantially identical to the sub-advisory agreements in
effect prior to the acquisition.
We believe that the transaction with AMG will increase our
ability to provide the shareholders of the Funds with a higher
caliber of investment advisory services. We anticipate that this
new arrangement will otherwise have no effect on the operations
of the Funds.
Please feel free to call us at (800) 835-3879 should you have any
questions on the enclosed information statement. We thank you
for your continued support of The Managers Funds.
Sincerely,
/s/Peter M. Lebovitz
Peter M. Lebovitz
President
THE MANAGERS FUNDS
40 Richards Avenue
Norwalk, Connecticut 06854
____________________
INFORMATION STATEMENT
____________________
This information statement is being provided to the
shareholders of Managers Income Equity Fund (the "Income Equity
Fund"), Managers Capital Appreciation Fund (the "Capital
Appreciation Fund"), Managers Special Equity Fund (the "Special
Equity Fund"), Managers International Equity Fund (the
"International Equity Fund"), Managers Emerging Markets Equity
Fund (the "Emerging Markets Equity Fund"), Managers Bond Fund
(the "Bond Fund"), Managers Short and Intermediate Bond Fund (the
"Short and Intermediate Bond Fund") and Managers Global Bond Fund
(the "Global Bond Fund"), (each a "Fund," and collectively the
"Funds"), in lieu of a proxy statement, pursuant to the terms of
an exemptive order The Managers Funds (the "Trust") has received
from the Securities and Exchange Commission. This exemptive
order permits the investment manager to each investment portfolio
of the Trust (together, with its predecessor entity, the
"Manager"), to hire new sub-advisers and make changes to existing
sub-advisory contracts for each investment portfolio with the
approval of the Trustees, but without obtaining shareholder
approval. WE ARE NOT ASKING YOU FOR A PROXY AND YOU ARE
REQUESTED NOT TO SEND US A PROXY.
This information statement will be mailed on or about June
7, 1999.
The Trust and its Investment Management Agreements
The Trust entered into an investment management agreement
with respect to each Fund with The Managers Funds, L.P., the
predecessor to The Managers Funds LLC, dated August 17, 1990 (the
"Previous Management Agreement"). On April 1, 1999, The Managers
Funds, L.P. consummated an agreement with Affiliated Managers
Group, Inc. ("AMG") pursuant to which The Managers Funds, L.P.
converted to a Delaware limited liability company (The Managers
Funds LLC) and AMG acquired a 100% interest in the capital of the
Manager and a 95% interest in its profits. Because it involved
a change in control of the Funds' investment adviser, completion
of this transaction resulted in a termination of the Previous
Management Agreement. At a Special Meeting of the Shareholders
on March 31, 1999, a new investment management agreement was
approved between the Trust, on behalf of each of the Funds, and
the Manager to take effect upon the closing of the transaction
(the "New Management Agreement"). The New Management Agreement
is substantially identical to the Previous Management Agreement,
with the exception of the effective date and the name of the
Manager.
Under the terms of both the Previous Management Agreement
and the New Management Agreement, it is the responsibility of the
Manager to select, subject to review and approval by the
Trustees, one or more sub-advisers (each a "Sub-Adviser", and
collectively the "Sub-Advisers") to manage the investment
portfolio of each Fund, to review and monitor the performance of
these Sub-Advisers on an ongoing basis, and to recommend changes
in the roster of Sub-Advisers to the Trustees as appropriate.
The Manager is also responsible for allocating the Fund's assets
among the Sub-Advisers for a Fund, if such Fund has more than one
Sub-Adviser. The portion of a Fund's assets managed by a Sub-
Adviser may be adjusted from time to time in the sole discretion
of the Manager. It is possible that, at certain times, a Sub-
Adviser under contract may be allocated none of a Fund's assets
to manage. The Manager is also responsible for conducting all
business operations of the Trust, except those operations
contracted to the custodian or transfer agent. As compensation
for its services, the Manager receives a fee from each Fund, and
the Manager is responsible for payment of all fees payable to the
Sub-Advisers of that Fund. The Funds, therefore, pay no fees to
the Sub-Advisers.
The Manager recommends Sub-Advisers for the Funds to the
Trustees based upon its continuing quantitative and qualitative
evaluation of the Sub-Advisers' skills in managing assets
pursuant to specific investment styles and strategies. Short-
term investment performance, by itself, is not a significant
factor in selecting or terminating a Sub-Adviser, and the Manager
does not expect to recommend frequent changes of Sub-Advisers.
The Sub-Advisers do not provide any services to the Funds
except portfolio investment management and related record-keeping
services. However, in accordance with procedures adopted by the
Trustees, a Sub-Adviser, or its affiliated broker-dealer, may
execute portfolio transactions for a Fund and receive brokerage
commissions in connection therewith as permitted by Section 17(e)
of the Investment Company Act of 1940, as amended (the "1940
Act") and the rules thereunder.
Exemptive Order
The Trust has received an exemptive order from the
Securities and Exchange Commission (Investment Company Release
No. 21412, Oct. 11, 1995) which permits the Manager to hire new
Sub-Advisers or to make changes to existing sub-advisory
agreements with the approval of the Trust's Trustees, but without
shareholder approval. Among other things, this Order requires
the Manager to provide shareholders with a statement containing
all information regarding a new Sub-Adviser or a material change
in a Sub-Advisory Agreement to the same extent as would be set
forth in a proxy statement.
The Sub-Advisory Agreements
The recent acquisition of The Managers Funds, L.P. by
Affiliated Managers Group, Inc. (and its restructuring as The
Managers Funds LLC), resulted in the termination of the sub-
advisory agreements for each Fund of the Trust (the "Previous Sub-
Advisory Agreements"). Therefore, The Managers Funds LLC
executed new sub-advisory agreements on behalf of each Fund (the
"New Sub-Advisory Agreements").
At a meeting held on January 13, 1999, the Trustees unanimously
approved the New Sub-Advisory Agreements between the Manager and
each of the respective Sub-Advisers for each Fund. Depending on
when they were adopted, the Previous Sub-Advisory Agreements
differ from the New Sub-Advisory Agreements in various respects.
The form of the New Sub-Advisory Agreement is the current version
used by the Trust. This form has been revised from time to time
over the years.
In November 1994, the Trustees unanimously approved the adoption
of the new form of agreement with respect to Sub-Advisers
retained after that date. At their September 9, 1996 meeting the
Trustees approved certain further changes to the new form. The
new form is very similar in substance to the old form in that it
provides for the Sub-Adviser to manage the portion of the Fund
allocated to it on a discretionary basis, provides for the
Manager to compensate the Sub-Adviser for its services,
authorizes the Sub-Adviser to select the brokers or dealers to
effect portfolio transactions for the Fund, and requires the Sub-
Adviser to comply with the Fund's investment policies and
restrictions and with applicable law. However, because the
previous form of agreement had been in use for a number of years,
the Trustees believed it advisable to conform the agreement to
current standards; for example, the Sub-Adviser's
responsibilities with respect to compliance monitoring and
insurance coverage were clarified.
Previous Sub-Advisory Agreements first adopted after
September 1996 differ from the New Sub-Advisory Agreements only
in that they have different effective and termination dates, and
the identity of the Manager is different. The form of the New
and Previous Agreements as in effect for various periods, are
attached to this information statement as Exhibits A (pre-
November 1994 form) and B (November 1994-September 1996 form),
marked to show changes from the New Sub-Advisory Agreement. Each
Exhibit also includes a Schedule indicating which Sub-Advisers
had the particular version of the Previous Sub-Advisory Agreement
in effect. The Previous Sub-Advisory Agreements for all of the
other Sub-Advisers were all executed after September 1996.
The following table provides information concerning the
investment advisory fees paid to the Manager and the sub-advisory
fees paid to each Sub-Adviser, as well as the advisory fees
retained by the Manager, under both the Previous and New
Management and Sub-Advisory Agreements.
<TABLE>
<CAPTION>
INVESTMENT ADVISORY FEES PAID TO AND
RETAINED BY THE MANAGER AND PAID
BY THE MANAGER TO EACH SUB-ADVISER
Current Advisory Sub-Advisory Net Advisory
Fund Name Fee* Fees Paid* Fees Retained*
- ----------------- ------------------ -------------------------------
<S> <C> <C> <C>
EQUITY FUNDS
Income Equity Fund 0.75% 0.35% 0.40%
Capital Appreciation Fund 0.80% 0.40% 0.40%
Special Equity Fund 0.90% 0.50% 0.40%
International Equity Fund 0.90% 0.50% 0.40%
Emerging Markets Equity Fund 1.15%1 0.75% 0.40%1
INCOME FUNDS
Bond Fund 0.625% 0.25% 0.375%
Short and Intermediate Bond Fund 0.50% 0.25% 0.25%
Global Bond Fund 0.70% 0.30% up to $20mm 0.30% up to$20mm
0.25% thereafter 0.35% thereafter
_______________________________________________________________________
<FN>
*Expressed as an annual percentage of average daily net assets
1The Manager is currently waiving 0.40% of this fee pursuant to a
voluntary fee waiver that may be terminated at any time.
</FN>
</TABLE>
Information on the Sub-Advisers
The following is a description of each of the Sub-Advisers
for the Funds of the Trust, which is based on information which
each Sub-Adviser has provided. Except for Essex Investment
Management Company, LLC, for which additional affiliation
information is provided below, the following Sub-Advisers are not
affiliated with the Manager or the Trust, other than by reason of
serving as Sub-Adviser to one or more Funds.
CHARTWELL INVESTMENT PARTNERS, L.P. (Income Equity Fund)
1235 Westlakes Drive, Suite 330
Berwyn, PA 19312-2412
Chartwell Investment Partners, L.P. ("Chartwell") is a
limited partnership founded in 1997. It is 75% controlled by the
employees of Chartwell and 25% controlled by Maverick Partners,
L.P. ("Maverick"). Maverick is controlled by John McNiff and
Michael Kennedy. As of December 31, 1998, Chartwell's assets
under management were approximately $2.7 billion.
The name and principal occupation of the directors and
principal executive officers of Chartwell are set forth below.
The address of each is that of Chartwell.
Name Position
- ----------------- --------------------------
Edward N. Antoian Partner, Portfolio Manager
Michael J. McCloskey Partner
Kevin A. Melich Partner, Portfolio Manager
Timothy J. Riddle Partner, Compliance Officer
Bernard P. Schaffer Partner, Portfolio Manager
Winthrop S. Jessup Partner
Michael D. Jones Partner, Portfolio Manager
Terry F. Bovarnick Partner, Portfolio Manager
David C. Dalrymple Partner, Portfolio Manager
Chartwell does not act as an investment adviser to any other
investment companies having similar investment objectives to the
Income Equity Fund.
SCUDDER KEMPER INVESTMENTS, INC. (Income Equity and International
Equity Funds)
345 Park Avenue
New York, NY 10154
Scudder Kemper Investments, Inc. ("Scudder") is a privately-
held Delaware corporation founded in 1919 which is owned and
controlled by the Zurich Group. The Zurich Group, located at
Mythenquai 2, 8002 Zurich, Switzerland, is a leading publicly-
owned international insurance and financial services
organization. As of December 31, 1998, Scudder's assets under
management were approximately $281.2 billion.
The name and principal occupation of the directors and
principal executive officers of Scudder are set forth below. The
address of each is that of Scudder or Zurich.
Name Position
- --------- --------
Edmond D. Villani President, Chief Executive Officer,Director
Rolf Hueppi Chairman
Lawrence W. Cheng Director
Cornelia Small Director, Chief Investment Officer, Vice President
Lynn S. Birdsong Director, Vice President
Gunther Gose Director
William H. Bolinder Director
Kathryn L. Quirk Secretary, Chief Compliance Officer, Chief
Legal Officer
Stephen R. Beckwith Treasurer, Chief Financial Officer
Robert A. Rudell Chief Operations Officer
Scudder acts as an investment adviser to the following
investment company with investment objectives similar to the
Income Equity Fund:
Annual Fee Rate(as a
Net Assets of Fund percentage ofaverage
Fund as of 3/31/99 daily net assets)
- ----------------------- ------------------- ----------------------
Scudder Growth and Income Fund $7,183.6 million 0.44%
AARP Growth and Income Fund $6,463.4 million 0.48%
Scudder acts as an investment adviser to the following
investment company with investment objectives similar to the
International Equity Fund:
Annual Fee Rate(as a
Net Assets of Fund percentage of average
Fund as of 3/31/99 daily net assets)
- ----------------------- ------------------- -----------------------
Scudder International Fund $3,103.7 million 0.81%
ROXBURY CAPITAL MANAGEMENT, LLC (Capital Appreciation Fund)
100 Wilshire Boulevard, Suite 600
Santa Monica, CA 90401
Roxbury Capital Management ("RCM") is a California
corporatrion founded in 1986. RCM transferred all of its assets
in 1998 to Roxbury Capital Management, LLC ("Roxbury") which is
jointly owned by employees and WT Investemts, Inc., a subsidiary
of Wilmington Trust Company. As of December 31, 1998, Roxbury's
assets under mnanagement were approximately $6 billion. WTI's
address is 1700 N. Market Street, Wilmington, Delaware 19890.
The name and principal occupation of the directors and
principal executive officers of Roxbury are set forth below. The
address of each is that of Roxbury.
Name Position
- ----- ---------
Anthony H. Browne Senior Managing Director, Co-Chief Investment
Officer, Portfolio Manager
Kevin P. Riley Senior Managing Director, Co-Chief Investment
Officer, Portfolio Manager
Harry B. Wilson Senior Managing Director, Client Service/
Business Development
Donald R. Bessler Managing Director, Research/Portfolio Manager
David C. Kahn Managing Director, Portfolio Manager/Client Service
Alfred J. Lockwood Managing Director, Research/Portfolio Manager
Clare N. McTernan Managing Director, Portfolio Manager
David P. Garza Senior Vice President, Research/Portfolio Manager
Roxbury does not act as an investment adviser to any other
investment companies having investment objectives similar to the
Capital Appreciation Fund.
LIBERTY INVESTMENT MANAGEMENT (Special Equity Fund)
2502 Rocky Point Drive, Suite 500
Tampa, FL 33607
Liberty Investment Management ("Liberty") was originally
formed in 1976 and is a division of Goldman Sachs Asset
Management ("Goldman"). Goldman is a separate division of
Goldman, Sachs & Co. Goldman has its principal place of business
address at One New York Plaza, New York, New York 10004.
Goldman, Sachs & Co. is located at 85 Broad Street, New York, New
York 10004. As of March 31, 1999, Liberty's assets under
management were approximately $11.7 billion.
The name and principal occupation of the directors and
principal executive officers of Liberty are set forth below. The
address of each is that of Liberty.
Name Position
- ----- ---------
Herbert E. Ehlers Managing Director, Chief Investment Officer
Lincoln Kinnicutt Vice President
Liberty acts as an investment adviser to the following
investment company with investment objectives similar to the
Special Equity Fund:
Net Assets of Fund Annual Fee Rate(as
Fund as of 3/31/99 a percentage of net assets)
- ----------------- ------------------- -----------------------
EAI Select Managers Equity $14.7 million 0.375%
PILGRIM, BAXTER & ASSOCIATES, LTD. (Special Equity Fund)
825 Duportail Road
Wayne, PA 19087
Pilgrim, Baxter & Associates, Ltd. ("Pilgrim") was formed in
1982 and is owned by United Asset Management ("UAM"), a public
company. UAM is located at One International Place, Boston,
Massachusetts 02110. As of December 31, 1998, Pilgrim's assets
under management were approximately $13.9 billion.
The name and principal occupation of the directors and
principal executive officers of Pilgrim are set forth below. The
address of each is that of Pilgrim.
Name Position
- ----- ---------
Harold J. Baxter President, Chief Executive Officer, Director
Gary L. Pilgrim Secretary, Treasurer, Chief Investment Officer,
Director
Eric C. Schneider Chief Financial Officer
Stephen M. Wellman Director of Operations
Pilgrim does not act as an investment adviser to the
following investment company with investment objectives similar
to the Special Equity Fund.
WESTPORT ASSET MANAGEMENT, INC. (Special Equity Fund)
253 Riverside Avenue
Westport, CT 06880
Westport Asset Management, Inc. ("Westport") was formed in
1983 and is 51%-owned by Andrew J. Knuth and 49%-owned by Ronald
H. Oliver. As of December 31, 1998, Westport's assets under
management were approximately $2 billion.
The name and principal occupation of the directors and
principal executive officers of Westport are set forth below.
The address of each is that of Westport.
Name Position
- ----- ---------
Andrew J. Knuth Chairman
Edmund H. Nicklin, Jr. Executive Vice President
Ronald H. Oliver President
Westport acts as an investment adviser to the following
investment company with investment objectives similar to the
Special Equity Fund:
Net Assets of Fund Annual Fee Rate (as a
Fund as of 3/31/99 percentage of net assets)
- ----------------- ------------------- -------------------------
Westport Small Cap Fund $ 81,487,234 1%
Diversified Investment Advisors $237,543,414 0.50%
The Investment Fund for Foundations$ 33,863,389 incentive
KERN CAPITAL MANAGEMENT LLC (Special Equity Fund)
114 West 47th Street, Suite 1926
New York, NY 10036
Kern Capital Management LLC ("KCM") is a Delaware limited
liability company founded in 1997. KCM is controlled by Robert
E. Kern, Jr., David G. Kern, and Fremont Investment Advisors,
Inc., a subsidiary of Fremont Investments, Inc., which is
affiliated with The Fremont Group. As of December 31, 1998,
KCM's assets under management were approximately $405 million.
The name and principal occupation of the directors and
principal executive officers of KCM are set forth below. The
address of each is that of KCM.
Name Position
- ----- ---------
Robert E. Kern, Jr. President, Chief Executive Officer, Principal,
Senior Investment Manager
David G. Kern Executive Vice President, Principal,
Senior Investment Manager
Judy Finger Senior Vice President, Principal, Senior
Investment Manager
KCM acts as an investment adviser to the following
investment companies with investment objectives similar to the
Special Equity Fund:
Net Assets of Fund Annual Fee Rate (as a
Funds as of 3/31/99 percentage of net assets)
- ----------------- ------------------- -----------------------
Fremont U.S. Micro-Cap $137.8 million 1.50% on 1st $30 million
1.00% on next $70 million
0.75% thereafter
Fremont Institutional Micro-Cap $54 million 0.75%
Fremont U.S. Small-Cap $11 million 0.65%
LAZARD ASSET MANAGEMENT (International Equity Fund)
30 Rockefeller Plaza
New York, NY 10112
Lazard Asset Management ("Lazard") is a division of Lazard
Freres & Co. LLC, a New York limited liability company founded in
1848. As of March 31, 1999, Lazard's assets under management
were approximately $64 billion.
The name and principal occupation of the directors and
principal executive officers of Lazard are set forth below. The
address of each is that of Lazard.
Name Position
- ----- ---------
Eileen D. Alexanderson General Member
Thomas F. Dunn General Member
Norman Eig General Member
Herbert M. Gullquist General Member
Ira O. Handler General Member
Melvin L. Heineman General Member
Ivan-Jacques Kerno General Member
Larry A. Kohn General Member
Robert P. Morgenthau General Member
John R. Reinsberg General Member
Michael S. Rome General Member
Michael P. Triguboff General Member
Alexander E. Zagoreos General Member
Lazard acts as an investment adviser (or sub-adviser) to the
following investment companies with investment objectives similar
to the International Equity Fund:
Net Assets of Fund Annual Fee Rate (as a
Funds as of 3/31/99 percentage of net assets)
- ----------------- ------------------- -----------------------
Lazard International Equity $3,035.1million 0.75%
Lazard Retirement
International Equity $0.7 million 0.75%
American Advantage
International Equity $250.0 million 0.50% to $100 million
0.325% next $400 million
0.20% thereafter
Fortis International Stock $104.4 million 0.45% to $100 million
0.375% thereafter
ISG International Equity $28.5 million 0.50%
Prestige International $3.4 million 0.45% to $200 million
0.40% thereafter
Prudential Diversified
Moderate Growth $9.1 million 0.40%
Prudential Diversified
High Groth $18.6 million 0.40%
Target International Equity $235.4 million 0.40%
Travelers Lazard
International Stock $65.0 million 0.475%
KING STREET ADVISORS, LIMITED (Emerging Markets Equity Fund)
Almack House, 28 King Street
London, England SW1Y 6QW
King Street Advisors, Limited ("King Street") was founded in
1996 and is 75% owned by State Street International Holdings,
Limited ("SSIH"). SSIH is 100% owned by State Street Bank and
Trust Company ("SSBT") and SSBT is 100% owned by State Street
Corporation ("SSC"). SSIH, SSBT and SSC are all located at 225
Franklin Street, Boston, Massachusetts 02105. As of December 31,
1998, King Street's assets under management were approximately
$361 million.
The name and principal occupation of the directors and
principal executive officers of King Street are set forth below.
The address of each is that of King Street.
Name Position
- ----- ---------
Kenneth King Managing Director, Chief Investment Officer,
Portfolio Manager
Murray Davey Director, Portfolio Manager
Christopher James Director, Senior Asian Fund Manager
Gavin MacLachlan Business Manager
Christopher Vale Director
Derek Satterthwaite Director
King Street does not act as an investment adviser to any
other investment companies having investment objectives similar
to the Emerging Markets Equity Fund.
LOOMIS, SAYLES & COMPANY, L.P. (Bond Fund)
One Financial Center
Boston, Massachusetts 02111
Loomis, Sayles & Company, L.P. ("Loomis") was founded in
1926. Its sole general partner, Loomis, Sayles & Company, Inc.,
is a special purpose corporation that is an indirect wholly-owned
subsidiary of Nvest Companies, L.P. ("Nvest Companies"). Nvest
Companies' managing general partner, Nvest Corporation, is a
direct wholly-owned subsidiary of Metropolitan Life Insurance
Company ("Met Life"), a mutual life insurance company. Nvest
Companies' advising general partner, Nvest L.P., is a publicly
traded company listed on the New York Stock Exchange. Nvest
Corporation is the sole general partner of Nvest L.P. As of
December 31, 1998, Loomis' assets under management were
approximately $70.7 billion.
The name and principal occupation of the directors and
principal executive officers of Loomis are set forth below. The
address of each is that of Loomis.
Name Position
- ------ -------------
Robert J. Blanding Chairman, President, Chief Executive Officer
Jeffrey L. Meade Director, Executive Vice President, Chief
Operating Officer
Sandra P. Tichenor Director, executive Vice President, General
Counsel
Mauricio F. Cevallos Director, Executive Vice President
Daniel J. Fuss Director, Executive Vice President
Isaac H. Green Director
Mark W. Holland Director
Michael J. Millhouse Director
Kent P. Newmark Director
Philip J. Schettewi Director
George R. Tydings Director, Executive Vice President
Peter S. Voss Director
Anthony J. Wilkins Director
Loomis acts as an investment adviser to the following
investment companies with investment objectives similar to the
Bond Fund:
Net Assets of Fund Annual Fee Rate (as a
Funds as of 3/31/99 percentage of net assets)
- ----------------- ------------------- -----------------------
Loomis Sayles Bond Fund $1.6 billion 0.60%
Loomis Sayles Fixed Income Fund $280.4 million 0.60%
Maxim Corporate Bond Series $216.7 million 0.30%
STANDISH, AYER & WOOD, INC. (Short and Intermediate Bond Fund)
One Financial Center, Suite 26
Boston, Massachusetts 02111
Standish, Ayer & Wood, Inc. ("Standish") was founded in 1933
and is a privately owned corporation with 24 directors. As of
December 31, 1998, Standish had more than $46.2 billion in assets
under management. Standish acts as investment adviser to
Managers Intermediate Mortgage Fund, another investment portfolio
of the Trust.
The name and principal occupation of the directors and
principal executive officers of Standish are set forth below.
The address of each is that of Standish.
Name Position
- ------- --------------
Edward H. Ladd Chairman and Managing Director
George W. Noyes Chief Executive Officer, President and Managing
Director
Caleb F. Aldrich Managing Director and Vice President
Davis B. Clayson Director and Vice President
Dolores S. Driscoll Managing Director and Vice President
Richard C. Doll Director and Vice President
Maria D. Furman Managing Director and Vice President
Richard S. Wood Managing Director, Vice President and Secretary
Nicholas S. Battelle Director and Vice President
David H. Cameron Director and Vice President
Karen K. Chandor Director and Vice President
James E. Hollis III Director and Vice President
Laurence A. Manchester Director and Vice President
Arthur A. Parker Director and Vice President
Howard B. Rubin Director and Vice President
Austin C. Smith Director and Vice President
W. Charles Cook Director and Vice President
Joseph M. Corrado Director and Vice President
Mark A. Flaherty Director and Vice President
Raymond J. Kubiak Director and Vice President
Thomas P. Sorbo Director and Vice President
David C. Stuehr Director and Vice President
Michael W. Thompson Director and Vice President
Ralph S. Tate Managing Director and Vice President
Standish acts as an investment adviser to the following
investment company with investment objectives similar to the
Short and Intermediate Bond Fund:
Net Assets of Fund Annual Fee Rate (as a
Fund as of 3/31/99 percentage of net assets)
- ---------------- ------------------- -----------------------
Managers Intermediate Mortgage $11,831,303 0.20%
ROGGE GLOBAL PARTNERS, PLC (Global Bond Fund)
Sion Hill, 56 Victoria Embankment
London, England EC4Y 0DZ
Rogge Global Partners, plc ("Rogge") was founded in 1984 and
is owned by United Asset Management, a public company. UAM is
located at One International Place, Boston, Massachusetts 02110.
As of December 31, 1998, Rogge's assets under management were
approximately $5.6 billion.
The name and principal occupation of the directors and
principal executive officers of Rogge are set forth below. The
address of each is that of Rogge.
Name Position
- ------- ----------------
Olaf Rogge Director
Richard Bell Director
John Graham Director
Adrian James Director
David Witzer Compliance Officer
Rogge does not act as an investment adviser to any
investment company with investment objectives similar to the
Global Bond Fund.
Board of Trustees' Recommendation
At an in-person meeting held on January 13, 1999, the
Trustees approved, effective as of the date of the closing of the
transaction with AMG, the New Sub-Advisory Agreements. In
connection with this approval, the Trustees considered that the
Previous Sub-Advisory Agreements would be terminated solely
because of the transaction with AMG, and that the terms of the
transaction did not contemplate any changes in (i) the overall
form of the Sub-Advisory Agreement, (ii) the advisory fees
payable and services to be provided thereunder, or (iii) any
Fund's objectives and policies.
ADDITIONAL INFORMATION
Other Matters
The Manager, located at 40 Richards Avenue, Norwalk,
Connecticut 06854, serves as investment manager, principal
underwriter and administrator of the Trust.
To the knowledge of the Trust, as of June 1, 1999, no
individual person beneficially owned more than 5% of any Fund's
outstanding shares.
As of June 1, 1999, the Trustees and Officers of the Trust
as a group owned less than 1% of the outstanding shares of each
of the Funds.
Affiliated Brokers
As of June 1, 1999, none of the Sub-Advisers to any of the
Funds paid a commission to an affiliated broker for the fiscal
year ended December 31, 1998.
The Trust is not required to hold annual meetings of
shareholders and, therefore, it cannot be determined when the
next meeting of shareholders will be held. Shareholder proposals
to be considered for inclusion in the proxy statement for the
next meeting of shareholders must be submitted a reasonable time
before the proxy statement is mailed. Whether a proposal
submitted will be included in the proxy statement will be
determined in accordance with applicable state and federal law.
Copies of the most recent annual and semi-annual reports are
available without charge. To obtain a copy, call or write the
Manager, at 40 Richards Avenue, Norwalk, CT 06854, (800) 835-
3879.
By Order of the Trustees,
/s/Donald S. Rumery
DONALD S. RUMERY
Secretary
Dated: June 7, 1999
Exhibit A
FORM OF
PORTFOLIO MANAGEMENT AGREEMENT
Attention: [NAME]
<Manager>
RE: Asset Management Agreement
To whom it may concern:
The Managers <Fund>, (the "Portfolio") is a series of a
New York business trust (the "Trust") that is registered as an
investment company under the Investment Company Act of 1940
(the "Act"), and subject to the rules and regulations
promulgated thereunder.
The Managers Funds L.P. (the "Manager") acts as manager and
administrator of the Portfolio pursuant to the terms of it
Management Agreement with the Trust. The Manager is responsible
fur the day-to-day management and administration or the
portfolio and the coordination of investment of the Portfolio's
assets in portfolio securities. However, pursuant to the terms
of the Management Agreement, specific portfolio purchases and
sales for the Portfolio's investment portfolio or a portion
thereof, are to be made by advisory organizations recommended by
the Manager and approved by the Trustees of the Trust and by the
shareholders of the Portfolio.
1. Appointment as an Asset Manager. The Manager, being
duly authorized, hereby appoints and employs <manager> ("Asset
Manager") as a discretionary asset manager, on the terms and
conditions set forth herein, of those assets of the Portfolio
which the Manager determines to assign to the Asset Manager
(those assets being, referred to as the "Portfolio Account").
The Manager may, from time to time, with the consent of the
Asset Manager, make additions to the Portfolio Account and may,
from time to time, make withdrawals from the Portfolio Account.
2. Acceptance of Appointment; Standard of Performance.
The Asset Manager accepts the appointment as a discretionary
asset manager and agrees to use its best professional judgement
to make timely investment decisions for the Portfolio with
respect to the investments of the Portfolio Account in
accordance with the provisions of this Agreement.
3. Asset Management Services of Asset Manager. The Asset
Manager is hereby employed and authorized to select Portfolio
securities for investment by the Portfolio, to purchase and sell
securities of the Portfolio AccounL and upon making any purchase
or sale decision, to place orders for the execution of such
portfolio transactions in accordance with paragraphs 5 and 6
hereof and Schedule A (as amended from time to time). In
Providing portfolio management services to the Portfolio Account,
the Asset Manager shall be subject to such investment
restrictions as are set forth in the Act and the Rules and
Regulations promulgated thereunder, the supervision and control
of the Trustees, such specific instructions as the Trustees may
adopt and communicate to the Asset Manager, the investment
objectives, policies and restrictions of the Portfolio furnished
pursuant to paragraph 4, and instructions from the Manager. The
Asset Manager shall maintain on behalf of the Portfolio the
records listed in Schedule B hereto (as amended from time to
time). At the Manager's reasonable request Asset Manager will
consult with the Portfolio or with the Manager with respect to
any decisions made by it with respect to the investments of the
Portfolio Account.
4. Investment Objectives, Policies and Restrictions. The
Manager shall provide the Asset Manager with a statement of the
investment objectives and policies of the Portfolio and any
specific investment restrictions applicable thereto as
established by the Portfolio. The Portfolio retains the right,
on written notice to the Asset Manager from the Portfolio or the
Manager, to modify any such objectives, policies or restrictions
in any manner at any time provided any such amendment is
consistent with the Declaration of Trust and By-Laws of the Trust
and with the Act and the Rules and Regulations promulgated
thereunder.
5. Transaction Procedures. All transactions will be
consummated by payment to or delivery by the Portfolio's
custodian (presently State Street Bank & Trust Company) (the
"Custodian"), or such depositories or agents as may be designated
by the Custodian, as custodian for the Portfolio, of all cash
and/or securities due to or from the Portfolio Account and the
Asset Manager shall not have possession or custody thereof or any
responsibility or liability with respect thereto. The Asset
Manager shall advise the Custodian and confirm in writing to the
Portfolio all investment orders for the Portfolio Account placed
by it with brokers and dealers at the time and in the manner as
set forth in Schedule A hereto (as amended from time to time).
The Portfolio shall issue to the Custodian such instructions as
may be appropriate in connection with the settlement of any
transaction initiated by the Asset Manager. The Portfolio shall
be responsible for all custodial arrangements and the payment of
all custodial charges and fees, and, upon giving proper
instructions to the Custodian, the Asset Manager shall have no
responsibility or liability with respect to custodial
arrangements or the acts, omissions or other conduct of the
Custodian.
6. Allocation. The Asset Manager shall have
authority
and discretion to select brokcrs and dealers to execute Portfolio
transactions initiated by the Asset Manager, and for the
selection of the markets on or in which the transaction will be
executed.
A. In doing so, the Asset Manager's primary
responsibility shall be to obtain the best net price and
execution for the Portfolio. However, this responsibility
shall not be deemed to obligate the Asset Manager to solicit
competitive bids for each transaction, and the Asset Manager
shall have no obligation to seek the lowest available
commission cost to the Portfolio, so long as the Asset Manager
determines that the broker or dealer is able to obtain the best
net price and execution for the particular transaction and that
the commission cost is reasonable in relation to the total
quality and reliability of the brokerage and research services
made available by the broker to the the Asset Manager viewed in
terms of either that particular transaction or of the the Asset
Manager's overall responsibilities with respect to its clients,
including the Portfolio, as to which the Asset Manager
exercises investment discretion, notwithstanding that the
Portfolio may not be the direct or exclusive beneficiary of any
such services or that another broker may be willing to charge
the Portfolio a lower commission on the particular transaction.
B. The Manager shall have the right to request that
specified transactions giving rise to brokerage commissions, in
an amount to be agreed upon by the Manager and the Asset
Manager, shall be executed by brokers and dealers that provide
brokerage or research services to the Portfolio or the Manager,
or as to which an on-going relationship will be of value to the
Portfolio in the management of its assets, which services and
relationship may, but need not, be of direct benefit to the
Portfolio Account, so long as (i) the Manager determines that
the broker or dealer is able to obtain the best net price and
execution on, a particular transaction and (ii) the Manager
determines that the commission cost is reasonable in relation to
the total quality and reliability of the brokerage and research
services made available to the Portfolio or to the Manager for
the benefit of its clients for which it exercises investment
discretion, notwithstanding that the Portfolio Account may not
be the direct or exclusive beneficiary of any such service or
that another broker may be willing to charge the Portfolio a
lower commission on the particular transaction.
C. The Asset Manager agrees that it will not execute any
portfolio transactions with a broker or dealer which is an
"affiliated person" (as defined in the Act) of the Trust or of
the Manager or of any asset manager for the Trust without the
prior written approval of the Portfolio. The Manager agrees that
it will provide the Asset Manager with a list of brokers and
dealers which are "affiliated persons" of the Trust, the Manaoer
or the Trust's asset managers.
D. As used in this paragraph 6, "brokerage and research
services' shall have the meaning set forth in Section 28(c)(3) of
the Securities Exchange Act of 1934 and such interpretations as
shall be published by the Securities and Exchange Commission from
time to time.
7. Proxies. The Portfolio will vote all proxies
solicited
by or with respect to the issuers of securities in which assets
of the Portfolio Account may be invested from time to time. At
the request of the Portfolio, the Asset Manager shall vote all
proxies on Securities held in the Portfolio Account on behalf of
the Portfolio.
8. Reports to the Asset Manager. The Manager shall
provide the Asset Manager with such periodic reports concerning
the status of the Portfolio Account as the Asset Manager may
reasonably request.
9. Fees for Servicing. The compensation of the Asset
Manager for its services under this Agreement shall be calculated
and paid by the Manager in accordance with the attached Schedule
C. Pursuant to the provisions of the Management Agreement between
the Portfolio and the Manager, the Manager is solely responsible
for the payment of fees to the Asset Manager, and the Asset
Manager agrees to seek payment of its fees solely from the
Manager.
10. Other Investment Activities of the Asset Manager. The
Manager acknowledges that the Asset Manager or one or more of its
affiliates may have investment responsibilities or render
investment advice to or perform other investment advisory
services for other individuals or entities ("Affiliated
Accounts"). Subject to the provisions of paragraph 2 hereof, the
Manager agrees that the Asset Manager or its affiliates may give
advice or exercise investment responsibility and take such other
action with respect to other Afflhated Accounts which may differ
from the advice given or the timing or nature of action taken
with respect to the Portfolio Account, provided that the Asset
Manager acts in good faith and provided further that it is the
Asset Manager's policy to allocate, within its reasonable
discretion, investment opportunities to the Portfolio Account
over a period of time on a fair and equitable basis relative to
the Affiliated Accounts, taking into account the investment
objectives and policies of the Portfolio and any specific
investment restrictions applicable thereto. The Manager
acknowledges that one or more of the Affiliated Accounts may at
any time hold, acquire, increase, decrease, dispose or otherwise
deal with positions in investments in which the Portfolio Account
may have an interest from time to time, whether in transactions
which involve the Porifollo Account or otherwise. The Asset
Manager shall have no obligation to acquire for the Portfolio
Account a position in any investment which any Affiliated Account
may acquire, and the Portfol'o shall have no fast refusal, co-
investment or other rights in respect of any such investment,
either for the Portfolio Account or otherwise.
11. Certificate of Authority. The Portfolio, the Manager
and the Asset Manager shall furnish to each other from time to
time certified copies of the resolutions of their Trustees or
Board of Directors or executive committees, as the case may be,
evidencing the authority of officers and employees who are
authorized to act on behalf of the Portfolio, a Portfolio
Account, the Manager and/or the Asset Manager.
12. Limitation of Liability. The Asset Manager shall not
be liable for any action taken, omitted or suffered to be taken
by it in its reasonable judgment, in good faith and believed by
it to be authorized or with the discretion or rights or powers
conferred upon it by this Agreement, or in accordance with (or in
the absence of) specific directions or instructions from the
Portfolio, provided, however, that such acts or omissions shall
not have resulted from the Asset Manager's willful misfeasance,
bad faith or gross negligence, a violation of the standard of
care established by paragraph 2 hereof and applicable to the
Asset Manager in its actions under this Agreement or breach of
its duty or of its obligations hereunder.
13. Confidentiality. Subject to the duty of the Asset
Manager, the Manager and the Portfolio to comply with applicable
law, including any demand of any regulatory or taxing authority
having jurisdiction, the parties hereto shall treat as
confidential all information pertaining to the Portfolio Account
and the actions of the Asset Manager and the Portfolio in
respect thereof.
14. Assignment. No assignment, as that term is defined in
Section 2(a)(4) of the Act, of this Agreement shall be made by
the Asset Manager, and this Agreement shall terminate
automatically in the event of such assigmment. The Asset Manager
shall notify the Portfolio in writing sufficiently in advance of
any proposed change of control, as defined in Section 2(a)(9) of
the Act, as will enable the Portfolio to consider whether an
assignment as defined in Section 2(a)(4) of the Act will occur,
and to take the steps necessary to enter into a new contract
with the Asset Manager.
15. Representations, Warranties and Agreements of the
Trust. The Trust represents, warrants, and agrees that:
A. The Asset Manager has been duly appointed by the
Trustees and shareholders of the Portfolio to provide
investment advice to the Portfolio Account as
contemplated hereby.
B. The Trust will deliver to the Asset Manager a true
and complete copy of its then current prospectus as amended or
supplemented from time to time and such other documents or
instruments governing the investment of the Portfolio Account
and such other information as is necessary for the Asset
Manager to carry out its obligations under this Agreement.
C. The Trust is currently in compliance and shall at all
times comply with the requirements imposed upon the
Portfolio by applicable law and regulation.
16. Representations, Warranties, and Agreements of the
Asset Manager. The Asset Manager represents, warrants, and
agrees that:
A. The Asset Manager is registered as an "Investment
Adviser" under the Investment Advisers Act of 1940 ("Advisers
Act"); or is a "bank" as defined in Section 202(a)(2) of the
Advisers Act.
B. The Asset Manager will maintain, keep current and
preserve on behalf of the Portfolio, in the manner required or
permitted by the Act, the records identified in Schedule B (as
amended from time to time). The Asset Manager agrees that such
records (other than those required by No. 4 of Schedule B) are
the property of the Portfolio, and will be surrendered to the
Portfolio promptly upon request.
C. The Asset Manager will adopt a written code of ethics
complying with the requirements of Rule 17j-1 under the Act,
will provide the Portfolio with a copy of the code of ethics and
evidence of its adoption, will report to the Portfolio all
violations of the code of ethics relating to the Portfolio and
will make such other reports to the Portfolio as are required by
the Portfolio as are required by Rule 17j-1 under the Act.
17. Amendment. This Agreement may be amended at any
time, but only by written agreement between the Asset Manager
and the Manager, which amendment, other than amendments to
Schedules A and B, is subject to the approval of the Trustees
and the shareholders of the Portfolio in the manner required by
the Act. Schedules A and B are operational schedules that are
attached to this Agreement for reference only and are not a
part of this Agreement.
18. Effective Date: Term. This Agreement shall become
effective on ________________, 1993 and shall continue in effect
for a term of two years from that date. Thereafter, the
Agreement shall continue in effect only so long as its
continuance has been specifically approved at least annually by
the Trustees, or the shareholders of the Portfolio in the manner
required by the Act. The aforesaid requirement that continuance
of this Agreement be "specifically approved at least annually"
shall be construed in a manner consistent with the Act and the
Rules and Regulations thereunder.
19. Terinination. This Agreement may be terminated by
either party hereto, without the payment of any penalty,
immediately upon written notice to the other in the event of a
breach of any provision hereof by the party so notified, or
otherwise upon sixty (60) days written notice to the other. This
agreement may be terminated by the Trustees or by vote of a
majority of the outstanding shares of the Portfolio, on sixty
(60) days written notice to the the Asset Manager. Any such
termination shall not affect the status, obligations, or
liabilities of any party hereto to the other.
20. 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 but shall continue in full force and effect.
21. Applicable Law. The provisions of this Agreement shall
be construed in a manner consistent with the requirements of the
Act and the Rules and Regulations thereunder. To the extent that
state law is not preempted by the provisions of any law of the
United States heretofore or hereafter enacted, as the same may be
amended from time to time, this Agreement shall be administered,
construed, and enforced according to the laws of the State of
Connecticut.
THE MANAGERS FUNDS, L. P.
BY: EAIMC HOLDINGS CORP.
General Partner
BY:_________________________
Its: _______________________
DATE:_______________________
ACCEPTED:
BY: __________________________
Its:__________________________
DATE:_________________________
Acknowledged:
The Managers Funds
BY: ________________________
Its: _______________________
DATE:_______________________
SCHEDULES: A. Operational Procedures.
B. Record Keeping Requirements.
C. Fee Schedule.
SCHEDULE A
The Asset Manager must abide by certain rules and
procedures in order to minimize operational problems. The Asset
Manager must maintain various records and files (as required by
regulatory agencies) at its office (see Schedule B). In
addition, it will be necessary for a flow of information to be
supplied to State Street Bank and Trust Company ("State Street").
the Custodian for the Portfolio.
The Asset Manager must furnish State Street with
daily information as to executed trades no later than the morning
following the day of the trade. The necessary information can be
transmitted via facsimile machine to State Street (the direct
line to the machine is (617) 348-0376, 348-0374, or 348-0377).
Upon receipt of brokers conflrmations, the Asset Manager or State
Street must noffy the other party if any differences exist. The
reporting of trades by the Asset Manager to State Street shall
include the following information:
1 - Purchase or sale;
2 - Security name;
3 - Cusip #;
4 - Number of shares;
5 - Commission rate per share or if a net
trade;
6 - Executing broker;
7 - Trade date;
8 - Settlement date, if other than normal;
and
9 - If Security is not eligible for DTC
When opening accounts with brokers for
the Portfolio, the
account must be a cash account. No margin accounts in the name
of the Portfolio are to be maintained. The broker should be
advised to use State Street IDC's ID system number (no. 20997) to
facilitate the receipt of information by State Street. In
addition, the Asset Manager should arrange to have duplicate
confirmations sent as follows:
The Managers Funds <<fund>> Portfolio
c/o The Managers Funds L.P.
200 Connecticut Avenue Suite 680
Norwalk, CT 06854-1907
State Street Bank & Trust Company
Custody and Shareholder Services Department
P.O. Box 1713
Boston, MA 02105
<<GN#>>
Delivery Instructions are as follows:
All DTC eligible securities
Depository Trust Company (DTC)
#997 Custodian Services
All Commerciad Paper and ineligible DTC securities New York
Office:
State Street Bank & Trust Company
TP Concourse Level
61 Broadway
New York, NY 10006
"vs payment" (Federal Funds on commercial paper only)
Account: The Managers Funds <<fund>> Portfolio
All Government issues delivered through book entry:
Delivery @ough area Federal Reserve Bank to:
State Street Boston
<<GN#>>
"vs payment" Federal Funds
Wire Instructions
State Street Bank & Trust Company
225 Franklin Street
Boston, MA 02010
Credit Info: ABA#: 0110000028
BNF#: <<GN#>>
AC: Demand Account #
The Asset Manager must submit to State Street a trade
authorization form signed by two authorized individuals by trade
date plus one. The list of authorized persons with specimen
signatures must be kept curtent at State Street.
The Asset Manager shall make available for State Street
appropriate names of individuals at executing brokers with whom
State Street may discuss and resolve problems that may occur.
State Street will supply the Asset Manager daily with a cash
availability report. This will normally be done by facsimilie so
that the Asset Manager may know the amount available for
investment purposes.
SCHEDULE B
Records to be Maintained by the Asset Manager
1. A record of each brokerage order, and all other
portfolio purchases and sales, given by the Asset Manager
on behalf of the Portfolio for, or in connection with, the
purchase or sale of securities, whether executed or
unexecuted. Such records shall include:
A. The name of the broker;
B. The terms and conditions of the order and of any
modifications or cancellation thereof;
C. The time of entry or cancellation;
D. The price at which executed;
E. The time of receipt of execution; and
F . The name of the person who placed the order on
behalf of the Portfolio.
2.* A record for each fiscal quarter, completed within ten
(10) days after the end of the quarter, showing
specifically the basis or bases upon which the allocation
of orders for the purchase and sale of portfolio
securities to brokers or dealers was effected, and the
division of brokerage commissions or other compensation on
such purchase and sale orders.
Such record:
A. Shall include the consideration given to:
(i) the sale of shares of the Portfolio
(ii) the supplying of services or benefits by brokers
or dealers to:
(a)Tbe Portfolio
(b)The Manager (The Managers Funds, L.P.)
(c)The Asset Manager and
(d) Any person other than the foregoing.
(iii) Any other consideration other than the
technical qualifications of the brokers and dealers
B. Shall show the nature of the services or benefits made
available.
C. Shall describe in detail the application of any general or
specific formula or other determinant used in arriving at
such allocation of purchase and sale orders and such
division of brokerage commissions or other compensation.
D. The name of the person responsible for making the
determination of such allocation and such division of
brokerage commissions or other compensation.
3. A record in the form of an appropriate memorandum identifying
the person or persons, committees or groups authorizing the
purchase or sale of portfolio securities. Where an
authorization is made by a committee or group, a record shall
be kept of the names of its members who participate in the
authorization.
There shall be retained as part of this record: any
memorandum, recommendation or instruction supporting or
authorizing the purchase or sale of portfolio securities and
such other information as is appropriate to support the
authorization.**
4 . Such accounts, books and other documents as are required
to be maintained by registered investment advisors by rule
adopted under Section 204 of the Investment Advisors Act of
1940, to the extent such records are necessary or appropriate
to record the Asset Manager's transactions with the Portfolio.
* Maintained as property of the Portfolio pursuant to 1940
Act Rule 3la-3(a).
** Such information might include: the current Form 10-K,
annual and quarterly reports, press releases, reports by
analysts and from brokerage firms (including their
recommendation; i.e., buy, sell, hold) or any internal
reports or asset manager reviews.
Schedule of Portfolio Management Agreements
The Managers Funds, L.P. has entered into portfolio
management agreements with the portfolio managers for each Fund.
Each such agreement is substantially identical in all material
respects to the form filed herewith. A list of the portfolio
management agreements, and the material details in which they
differ from the form, follows:
Name of Fund/Portfolio Manager
Special Equity Fund Westport Asset Management, Inc.
Liberty Investment Management
Income Equity Fund Scudder, Stevens & Clark, Inc.
International Equity Fund Scudder, Stevens & Clark, Inc.
Short and Intermediate Bond Fund Standish, Ayer & Wood
Bond Fund Loomis, Sayles & Company, Inc.
Global Bond Fund Rogge Global Partners
EXHIBIT B
FORM OF SUB-ADVISORY AGREEMENT
Marked to show changes from Previous Agreement
Attention: [NAME] <Manager>
RE: Sub-Advisory Agreement
To whom it may concern:
The Managers ________ Fund (the "Fund") is a series of a
Massachusetts business trust (the "Trust") that is registered as
an investment company under the Investment Company Act of 1940,
as amended, (the "Act"), and subject to the rules and regulations
promulgated thereunder.
The Managers Funds, L.P. (the "Manager") acts as the manager and
administrator of the Trust pursuant to the terms of a Management
Agreement with the Trust. The Manager is responsible for the day-
to-day management and administration of the Fund and the
coordination of investment of the Fund's assets. However,
pursuant to the terms of the Management Agreement, specific
portfolio purchases and sales for the Fund's investment
portfolios or a portion thereof, are to be made by advisory
organizations recommended by the Manager and approved by the
Trustees of the Trust.
1. Appointment as a Sub-Adviser. The Manager, being duly
authorized, hereby appoints and employs ________________ ("Sub-
Adviser") as a discretionary asset manager, on the terms and
conditions set forth herein, of those assets of the Fund which
the Manager determines to allocate to the Sub-Adviser (those
assets being referred to as the "Fund Account"). The Manager
may, from time to time, with the consent of the Sub-Adviser, make
additions to the Fund Account and may, from time to time, make
withdrawals of any or all of the assets in the Fund Account.
2. Portfolio Management Duties.
(a) Subject to the supervision of the Manager and of
the Trustees of the Trust, the Sub-Adviser shall manage
the composition of the Fund Account, including the
purchase, retention and disposition thereof, in
accordance with the Fund's investment objectives,
policies and restrictions as stated in the Prospectus
(such Prospectus and Statement of Additional
Information for the Fund as currently in effect and as
amended or supplemented from time to time, being herein
called the "Prospectus").
(b) The Sub-Adviser shall maintain such books and
records pursuant to Rule 31a-1 under the Act and Rule
204-2 under the Investment Advisers Act of 1940, as
amended (the "Advisers Act"), with respect to the Fund
Account as shall be specified by the Manager from time
to time, and shall maintain such books and records for
the periods specified in the rules under the Act or the
Advisers Act. In accordance with Rule 31a-3 under the
Act, the Sub-Adviser agrees that all records under the
Act shall be the property of the Trust.
(c) The Sub-Adviser agrees to maintain adequate
compliance procedures to ensure its compliance with the
1940 Act, the Advisers Act and other applicable federal
and state regulations.
3. Allocation of Brokerage. The Sub-Adviser shall have
authority and discretion to select brokers, dealers and futures
commission merchants to execute portfolio transactions initiated
by the Sub-Adviser, and for the selection of the markets on or in
which the transactions will be executed.
(a). In doing so, the Sub-Adviser's primary
responsibility shall be to obtain the best net price
and execution for the Fund. However, this
responsibility shall not be deemed to obligate the Sub-
Adviser to solicit competitive bids for each
transaction, and the Sub-Adviser shall have no
obligation to seek the lowest available commission cost
to the Fund, so long as the Sub-Adviser determines that
the broker, dealer or futures commission merchant is
able to obtain the best net price and execution for the
particular transaction taking into account all factors
the Sub-Adviser deems relevant, including, but not
limited to, the breadth of the market in the security
or commodity, the price, the financial condition and
execution capability of the broker, dealer or futures
commission merchant and the reasonableness of any
commission for the specific transaction and on a
continuing basis. The Sub-Adviser may consider the
brokerage and research services (as defined in Section
28(e) of the Securities Exchange Act of 1934, as
amended) made available by the broker to the Sub-
Adviser viewed in terms of either that particular
transaction or of the Sub-Adviser's overall
responsibilities with respect to its clients, including
the Fund, as to which the Sub-Adviser exercises
investment discretion, notwithstanding that the Fund
may not be the direct or exclusive beneficiary of any
such services or that another broker may be willing to
charge the Fund a lower commission on the particular
transaction.
(b). The Manager shall have the right to request that
specified transactions giving rise to brokerage
commissions, in an amount to be agreed upon by the
Manager and the Sub-Adviser, shall be executed by
brokers and dealers that provide brokerage or research
services to the Fund or the Manager, or as to which an
on-going relationship will be of value to the Fund in
the management of its assets, which services and
relationship may, but need not, be of direct benefit to
the Fund Account, so long as (i) the Manager determines
that the broker or dealer is able to obtain the best
net price and execution on a particular transaction and
(ii) the Manager determines that the commission cost is
reasonable in relation to the total quality and
reliability of the brokerage and research services made
available to the Fund or to the Manager for the benefit
of its clients for which it exercises investment
discretion, notwithstanding that the Fund Account may
not be the direct or exclusive beneficiary of any such
service or that another broker may be willing to charge
the Fund a lower commission on the particular
transaction.
(c) The Sub-Adviser agrees that it will not execute
any portfolio transactions with a broker, dealer or
futures commission merchant which is an "affiliated
person" (as defined in the Act) of the Trust or of the
Manager or of any sub-adviser for the Trust except in
accordance with procedures adopted by the Trustees.
The Manager agrees that it will provide the Asset
Manager with a list of brokers and dealers which are
"affiliated persons" of the Trust, the Manager or the
Trust's sub-advisers.
4. Information Provided to the Manager and the Trust
(a) The Sub-Adviser agrees that it will make available
to the Manager and the Trust promptly upon their
request copies of all of its investment records and
ledgers with respect to the Fund Account to assist the
Manager and the Trust in monitoring compliance with the
Act, the Advisers Act, and other applicable laws. The
Sub-Adviser will furnish the Trust's Board of Trustees
with such periodic and special reports with respect to
the Fund Account as the Manager or the Board of
Trustees may reasonably request.
(b) The Sub-Adviser agrees that it will notify the
Manager and the Trust in the event that the Sub-Adviser
or any of its affiliates: (i) becomes subject to a
statutory disqualification that prevents the Sub-
Adviser from serving as investment adviser pursuant to
this Agreement; or (ii) is or expects to become the
subject of an administrative proceeding or enforcement
action by the Securities and Exchange Commission or
other regulatory authority. Notification of an event
within (i) shall be given immediately; notification of
an event within (ii) shall be given promptly. The Sub-
Adviser has provided the information about itself set
forth in the Registration Statement and has reviewed
the description of its operations, duties and
responsibilities as stated therein and acknowledges
that they are true and correct and contain no material
misstatement or omission, and it further agrees to
notify the Manager immediately of any fact known to the
Sub-Adviser respecting or relating to the Sub-Adviser
that causes any statement in the Prospectus to become
untrue or misleading in any material respect or that
causes the Prospectus to omit to state a material fact.
(c) The Sub-Adviser represents that it is an
investment adviser registered under the Advisers Act
and other applicable laws and that the statements
contained in the Sub-Adviser's registration under the
Advisers Act on Form ADV as of the date hereof, are
true and correct and do not omit to state any material
fact required to be stated therein or necessary in
order to make the statements therein not misleading.
The Sub-Adviser agrees to maintain the completeness and
accuracy of its registration on Form ADV in accordance
with all legal requirements relating to that Form. The
Sub-Adviser acknowledges that it is an "investment
adviser" to the Fund within the meaning of the Act and
the Advisers Act.
5. Compensation. The compensation of the Sub-Adviser for its
services under this Agreement shall be calculated and paid by the
Manager in accordance with the attached Schedule A. Pursuant to
the provisions of the Management Agreement between the Trust and
the Manager, the Manager is solely responsible for the payment of
fees to the Sub-Adviser, and the Sub-Adviser agrees to seek
payment of its fees solely from the Manager and not from the
Trust or the Fund.
6. Other Investment Activities of the Sub-Adviser. The Manager
acknowledges that the Sub-Adviser or one or more of its
affiliates may have investment responsibilities or render
investment advice to or perform other investment advisory
services for other individuals or entities ("Affiliated
Accounts"). The Manager agrees that the Sub-Adviser or its
affiliates may give advice or exercise investment responsibility
and take such other action with respect to other Affiliated
Accounts which may differ from the advice given or the timing or
nature of action taken with respect to the Fund Account, provided
that the Sub-Adviser acts in good faith and provided further,
that it is the Sub-Adviser's policy to allocate, within its
reasonable discretion, investment opportunities to the Fund
Account over a period of time on a fair and equitable basis
relative to the Affiliated Accounts, taking into account the
investment objectives and policies of the Fund and any specific
investment restrictions applicable thereto. The Manager
acknowledges that one or more of the Affiliated Accounts may at
any time hold, acquire, increase, decrease, dispose or otherwise
deal with positions in investments in which the Fund Account may
have an interest from time to time, whether in transactions which
involve the Fund Account or otherwise. The Sub-Adviser shall
have no obligation to acquire for the Fund Account a position in
any investment which any Affiliated Account may acquire, and the
Fund shall have no first refusal, co-investment or other rights
in respect of any such investment, either for the Fund Account or
otherwise.
7. Standard of Care. The Sub-Adviser shall exercise its best
judgment in rendering the services provided by it under this
Agreement. The Sub-Adviser shall not be liable for any act or
omission, error of judgment or mistake of law or for any loss
suffered by the Manager or the Trust in connection with the
matters to which this Agreement relates, provided that nothing in
this Agreement shall be deemed to protect or purport to protect
the Sub-Adviser against any liability to the Manager or the Trust
or to holders of the Trust's shares representing interests in the
Fund to which the Sub-Adviser would otherwise be subject by
reason of willful malfeasance, bad faith or gross negligence on
its part in the performance of its duties or by reason of the Sub-
Adviser's reckless disregard of its obligations and duties under
this Agreement.
8. Assignment. This Agreement shall terminate automatically in
the event of its assignment (as defined in the Act and in the
rules adopted under the Act). The Sub-Adviser shall notify the
Trust in writing sufficiently in advance of any proposed change
of control, as defined in Section 2(a)(9) of the Act, as will
enable the Trust to consider whether an assignment under the Act
will occur, and to take the steps necessary to enter into a new
contract with the Sub-Adviser or such other steps as the Board of
Trustees may deem appropriate.
9. Amendment. This Agreement may be amended at any time, but
only by written agreement between the Sub-Adviser and the
Manager, which amendment is subject to the approval of the
Trustees and the shareholders of the Trust in the manner required
by the Act.
10. Effective Date; Term. This Agreement shall become effective
on __________ and shall continue in effect for a term of two
years from that date. Thereafter, the Agreement shall continue
in effect only so long as its continuance has been specifically
approved at least annually by the Trustees, or the shareholders
of the Fund in the manner required by the Act. The aforesaid
requirement shall be construed in a manner consistent with the
Act and the rules and regulations thereunder.
11. Termination. This Agreement may be terminated by (i) the
Manager at anytime without penalty, upon notice to the Sub-
Adviser and the Trust, (ii) at any time without penalty by the
Trust or by vote of a majority of the outstanding voting
securities of the Fund (as defined in the Act) on notice to the
Sub-Adviser or (iii) by the Sub-Adviser at any time without
penalty, upon sixty (60) days' written notice to the Manager and
the Trust.
12. 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 but shall continue in full force and effect.
13. Applicable Law. The provisions of this Agreement shall be
construed in a manner consistent with the requirements of the Act
and the rules and regulations thereunder. To the extent that
state law is not preempted by the provisions of any law of the
United States heretofore or hereafter enacted, as the same may be
amended from time to time, this Agreement shall be administered,
construed, and enforced according to the laws of the State of
Connecticut.
THE MANAGERS FUNDS, L.P.
BY: EAIMC HOLDINGS CORP.
General Partner
BY:
Its:
DATE:
ACCEPTED:
BY:
Its:
DATE:
Acknowledged:
The Managers Funds
BY:
Its:
DATE:
SCHEDULES: A. Fee Schedule.
SCHEDULE A
SUB-ADVISER FEE
For services provided to the Fund Account, The Managers Funds,
L.P. will pay a base quarterly fee for each calendar quarter at
an annual rate of ___% of average assets in the Fund Account
during the quarter. Average assets shall be determined using the
average daily assets in the Fund Account during the calendar
quarter. The fee shall be pro-rated for any calendar quarter
during which the contract is in effect for only a portion of the
quarter.
Schedule of Portfolio Management Agreements
The Managers Funds, L.P. has entered into portfolio
management agreements with the portfolio managers for each Fund.
Each such agreement is substantially identical in all material
respects to the form filed herewith. A list of the portfolio
management agreements, and the material details in which they
differ from the form, follows:
Name of Fund/Portfolio Manager
Special Equity Fund Westport Asset Management, Inc.
Pilgrim Baxter & Associates
Liberty Investment Management
Income Equity Fund Scudder, Stevens & Clark, Inc.
International Equity Fund Scudder, Stevens & Clark, Inc.
Lazard Asset Management
Short and Intermediate Bond FundStandish, Ayer & Wood
Bond Fund Loomis, Sayles & Company, Inc.
Global Bond Fund Rogge Global Partners
