(RULE 14A-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )
Filed by the Registrant / /
Filed by a Party other than the Registrant /X/
CHECK THE APPROPRIATE BOX:
/X/ Preliminary Proxy Statement
/ / Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
/ / Confidential, for use of the Commission only (Rule 14a-6(e)(2))
THE COVENTRY GROUP
(Name of Registrant as Specified In Its Charter)
OLIVIA P. ADLER
DECHERT PRICE & RHOADS
1500 K STREET, N.W., SUITE 500
WASHINGTON, D.C. 20005
(202) 626-3352
(Name of Person(s) 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 (Set forth the amount on which the filling
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 is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
previously. Identify the previous filing by registration statement number of the
paid 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:
<PAGE>
THE ERNST WORLD FUNDS
The Ernst Global Asset Allocation Fund
The Ernst Asia Fund
The Ernst Global Resources Fund
3435 Stelzer Road
Columbus, Ohio 43219
Dear Shareholder:
The enclosed Notice of Special Meeting and Proxy Statement relate to a
special meeting of shareholders of the three portfolios of The Ernst World Funds
- - The Ernst Global Asset Allocation Fund ("Allocation Fund"), The Ernst Asia
Fund ("Asia Fund") and The Ernst Global Resources Fund ("Resources Fund")
(collectively, "Funds").
The purpose of the Meeting is to act on certain matters that must be
approved by shareholders of the Funds arising out of an approaching merger
between the Funds' investment adviser, Ernst & Company ("Ernst"), and Investec
Group, a South African investment banking group. Under applicable law, the
merger will cause an automatic termination of the Funds' investment advisory
contract with the sub-investment advisers to each of the Funds. Thus,
shareholders are being asked to approve a new investment advisory agreement with
Ernst and new sub-investment advisory agreements with each of the sub-investment
advisers that are substantially identical to the current agreements, except for
the date and term and certain updating changes. The merger is not expected to
cause any change in the operations of Ernst or in its services to the Funds. The
merger does not affect the sub-investment advisers and their services to the
Funds will be the same under the proposed new sub-investment advisory agreements
as they are under the current agreements. The Trustees have reviewed the
proposed merger and have approved the proposed new agreements but the agreements
must be approved by shareholders before they can become effective.
YOUR VOTE IS IMPORTANT
We urge you to read the enclosed Proxy Statement and to vote now by
completing, signing and returning the enclosed proxy ballot form in the prepaid
envelope.
Sincerely,
Walter B. Grimm
President
<PAGE>
THE ERNST WORLD FUNDS
The Ernst Global Asset Allocation Fund
The Ernst Asia Fund
The Ernst Global Resources Fund
3435 Stelzer Road
Columbus, Ohio 43219
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
to be held January 14, 1998
Notice is hereby given that a special meeting of shareholders
("Meeting") of the three portfolios of The Ernst World Funds - The Ernst Global
Asset Allocation Fund ("Allocation Fund"), The Ernst Asia Fund ("Asia Fund") and
The Ernst Global Resources Fund ("Resources Fund") (collectively, "Funds") --
will be held January 14, 1998 at the offices of the Funds' administrator, BISYS
Fund Services, Inc., 3435 Stelzer Road, Columbus, Ohio 43219. The Funds are
portfolios of The Coventry Group ("Coventry"), a registered investment company.
The Meeting is being held for the following purposes:
1. To approve a new Investment Advisory Agreement between Coventry and Ernst &
Company ("Ernst") on behalf of each of the Funds, with terms substantially
identical to the terms of the present Investment Advisory Agreement, except for
the date and the term and certain updating changes (to be voted on separately by
shareholders of each Fund.)
2a. To approve a new Sub-Investment Advisory Agreement between Ernst and
Koeneman Capital Management Pte Ltd., with respect to Asia Fund (to be voted on
by shareholders of Asia Fund only.)
2b. To approve a new Sub-Investment Advisory Agreement between Ernst and
National Mutual Funds Management (Global) Ltd., with respect to Resources Fund
(to be voted on by shareholders of Resources Fund only.)
2c. To approve a new Sub-Investment Advisory Agreement between Ernst and
National Mutual Funds Management (Global) Ltd., with respect to Allocation Fund
(to be voted on by shareholders of Allocation Fund only.)
3. To transact such other business as may properly come before the Meeting,
including any adjournment thereof.
The Board of Trustees of Coventry has fixed the close of business on
December 5, 1997 as the record date for determining shareholders entitled to
notice of, and to vote at, the Meeting, including any adjournment thereof.
By Order of the Board of Trustees
George L. Stevens
Secretary
<PAGE>
THE ERNST WORLD FUNDS
The Ernst Global Asset Allocation Fund
The Ernst Asia Fund
The Ernst Global Resources Fund
3435 Stelzer Road
Columbus, Ohio 43219
PROXY STATEMENT
This Proxy Statement provides information concerning matters indicated
in the preceding Notice that will be presented for action at a special meeting
("Meeting") of shareholders of the three portfolios of The Ernst World Funds -
The Ernst Global Asset Allocation Fund ("Allocation Fund"), The Ernst Asia Fund
("Asia Fund") and The Ernst Global Resources Fund ("Resources Fund")
(collectively, "Funds") to be held January 14, 1997 at 9:00 a.m., or on such
date(s) and times to which the Meeting is adjourned, at the offices of the
Funds' administrator, BISYS Fund Services, Inc., 3435 Stelzer Road, Columbus,
Ohio 43219. The Funds are portfolios of The Coventry Group ("Coventry"), a
registered investment company. The Funds' Annual Report, including audited
financial statements, for its fiscal year ended March 31, 1997, and its
Semiannual Report, including unaudited financial statements, for the period
ended September 30, 1997 are available upon request without charge from The
Ernst World Funds, 3435 Stelzer Road, Columbus, Ohio 43219, or by calling
1-800-261-FUND (3863). The approximate date of mailing of this Proxy Statement
is [date].
The matters to be voted on at the Meeting arise because of the
impending acquisition ("Acquisition") of Ernst & Company ("Ernst"), the Funds'
investment adviser, by Investec Group ("Investec"), a South African investment
banking firm. The Acquisition, which requires regulatory approval in both the
United States and South Africa, is expected to be effected in January, 1998. The
Acquisition will cause an immediate termination of the Funds' Investment
Advisory Agreement with Ernst and of the Sub-Investment Advisory Agreements
between Ernst and each of the Fund's sub-investment advisers, as described more
fully herein. Shareholders will therefore be asked to vote on a new Investment
Advisory Agreement with Ernst and new Sub-Investment Advisory Agreements with
the current sub-investment advisers of each of the Funds. (The Investment
Advisory Agreement and the Sub-Investment Advisory Agreements are herein after
collectively referred to as "Agreements.") The following table describes each
Proposal that will be presented at the Meeting and indicates on which Proposals
shareholders of each Fund will be asked to vote.
Proposal Who Will Vote
Proposal 1. Approval of a new shareholders of each Fund,
Investment Advisory voting separately
Agreement between The Coventry
Group and Ernst & Company on
behalf of the Funds
Proposal 2a. Approval of a new Asia Fund shareholders only
Sub-Investment Advisory
Agreement between Ernst & Company
and Koeneman Capital Management Pte
Ltd. with respect to Ernst Asia Fund
Proposal 2b. Approval of a new Sub- Resources Fund shareholders only
Investment Advisory Agreement between
Ernst & Company and National Mutual
Funds Management (Global) Ltd. with
respect to Ernst Global Resources Fund
Proposal 2c. Approval of a New Allocation Fund shareholders only
Sub-Investment Advisory Agreement
between Ernst & Company and National
Mutual Funds Management (Global) Ltd.
with respect to Ernst Global Asset
Allocation Fund
Voting
Shareholders of record for each Fund as of the close of business on
December 5, 1997 ("Record Date") are entitled to vote at the Meeting and at any
adjournment thereof on matters submitted to shareholders of that Fund.
Shareholders have one vote for each share held in a Fund, and a fractional vote
for each fraction of a share held in that Fund, on each matter submitted to
shareholders of the Fund. The presence at the Meeting, in person or by proxy, of
a majority of the outstanding shares of a Fund constitutes a quorum, permitting
action on matters related to that Fund. On the Record Date, the following
numbers of shares were outstanding for each Fund:
Name of Fund Shares Outstanding
Ernst Asia Fund
Ernst Global Resources Fund
Ernst Global Asset Allocation Fund
Approval of each Proposal requires the affirmative vote, as to each
affected Fund, of a majority of the outstanding voting securities of that Fund.
For this purpose, under applicable law, "vote of a majority of the outstanding
voting securities" of a Fund means the vote of (A) 67% or more of the voting
securities of the Fund present at the Meeting,, if the holders of more than 50%
of the outstanding voting securities of that Fund are present or represented by
proxy; or (B) more than 50% of the outstanding voting securities of the Fund,
whichever is less.
All shares represented by the enclosed form of proxy will be voted in
accordance with the instructions indicated on the proxy if it is completed,
dated, signed and returned in time to be voted at the Meeting and is not
subsequently revoked. If the proxy is returned properly signed and dated, but no
instructions are given, the shares represented will be voted in favor of each of
the proposals. Any proxy may be revoked by the timely submission of a properly
executed subsequent proxy, by a timely written revocation, or by an oral
revocation or vote at the Meeting prior to the finalization of the vote on a
particular proposal. Execution and submission of a proxy does not affect a
shareholder's right to attend the Meeting in person. Due to applicable legal
requirements that the proposals presented in this Proxy Statement must be
approved by specified percentages of a Fund's outstanding shares in order to be
adopted, an abstention by a shareholder from voting on a particular proposal,
either by proxy or in person at the Meeting, will have the same effect as a
negative vote as to that matter. Shares that are held by a broker-dealer or
other fiduciary as record owner for the account of a beneficial owner will be
counted for purposes of determining the presence of a quorum and as votes on
particular proposals if the beneficial owner has executed and timely delivered
the necessary instructions for the record owner to attend the Meeting and vote
the shares, or if the record owner has, and exercises, discretionary voting
power. If the record owner does not have discretionary voting power as to a
particular proposal, but grants a proxy for, or votes, the shares, those shares
will be counted toward the quorum but will have the effect of a negative vote as
to that proposal.
All costs associated with the Meeting, including the expenses of
preparing, printing and distributing the Proxy Statement, and legal expenses,
will be borne by Ernst.
The Board of Trustees may seek one or more adjournments of the Meeting
if necessary to obtain a quorum or to obtain the vote required for approval of
one or more proposals. A vote may be taken at the Meeting, including any
adjournment, on any proposal for which there are sufficient votes even though
the Meeting is adjourned as to other proposals.
The Acquistion
Ernst and Investec publicly announced on November 12, 1997 that they
had entered into a definitive agreement of merger pursuant to which Ernst would
be acquired by Investec. The Acquisition is expected to be effected by the end
of January, 1998. The Acquisition is not expected to change the operations of
Ernst and material personnel changes are not anticipated. Therefore, the
Acquisition is expected to have no immediate effect on the Funds or the services
provided by Ernst to the Funds. Over the longer term, the effects of the
Acquisition may be to enhance the resources that Ernst can make available to its
clients, through the asset management, international securities research and
other financial services available from Investec.
Investec
Investec, organized in 1974, is the leading investment banking group in South
Africa and is the fifth largest capitalized banking group in sub-Saharan Africa.
Investec is one of the top 20 companies listed on the Johannesburg Stock
Exchange and is rated among the top 400 banks in the world. It is South Africa's
leading specialist investment and private banking group. In its financial year
ended March 31, 1997, Investec recorded attributable earnings of US$80 million,
with assets of US$13.4 billion and total assets under management of US$29.3
billion. Investec's international operations include Investec Bank (UK) Limited,
Clive Securities Group, Investec Bank (Jersey) Limited, Carr Sheppards (a
stockbroking and private client portfolio management firm) and Investec Bank
Australia. Investec also controls Israel, General Bank Limited, and recently
acquired Banque Privee Edmond de Rothschild (Ocean Indean Ltee) in Mauritius. It
also owns 10% of the Netherlands financial services firm, Insinger Group.
Investec's acquisition of Ernst will be Investec's first major entry
into the U.S. financial markets and will enable Investec to offer a U.S.
presence in connection with its international securities trading and
distribution services to South African and international clients.
Ernst
Ernst, the Funds' investment adviser, is (and will continue to be after
the Acquisition) located at One Battery Park Plaza, New York, New York 10004.
Ernst is a registered broker-dealer and is registered with the Securities and
Exchange Commission as an investment adviser. Ernst currently manages assets of
about $52 million in addition to the Funds. Ernst is a member of the New York
Stock Exchange and of each other major U.S. stock exchange and provides
broker-dealer services to institutions and, through its correspondent
broker-dealer firms, to individual clients. These business activities of Ernst
will continue after the Acquisition.
The Sub-Investment Advisers
National Mutual Funds Management (Global), Ltd. ("NMFM"), 447 Collins
Street, Melbourne, Australia 3000, serves as sub-investment adviser to
Allocation Fund and Resources Fund. NMFM is a subsidiary of National Mutual Life
of Australia Ltd., one of the world's largest insurance companies. Through its
parent company, NMFM has managed assets for 126 years, NMFM and its affiliated
companies now manage over $20.4 billion in assets. NMFM has access to global
money management resources through affiliates in Japan, Hong Kong, New Zealand
and the United States.
NMFM is wholly owned by National Mutual Holdings Limited, 447 Collins
Street, Melbourne, Australia 3000, which in turn is 51% owned by AXA UAP., one
of the world's largest insurance companies.
A wholly owned subsidiary of NMFM is the beneficial owner of 18.56% of
the total outstanding shares of Koeneman Capital Management, Pte, Ltd,
sub-investment adviser to Asia Fund (see below).
Koeneman Capital Management Pte Ltd, ("KCM"), 6 Raffles Quay #13-01/07,
John Hancock Tower, Singapore 048580, serves as sub-investment adviser to Asia
Fund. KCM began operating as an institutional investment management company in
1989 and specializes in managing international equities and currencies for a
variety of financial institutions, sovereign investors and endowment funds in
Australia, Singapore and the United States. KCM is registered as an investment
adviser with both the U.S. Securities and Exchange Commission and the Monetary
Authority of Singapore. KCM currently has approximately $250 million in assets
under management.
In addition to ownership interests of NMFM and of certain directors of
KCM (see "Other Information," below), the following own 10% or more of the
outstanding voting securities of KCM: BNB Holdings (Pty) Ltd. (12.5%) 525
Collins Street, Melbourne, Australia 3000 and Geoffrey Wong (10.0%) [address to
be provided].
Evaluation by the Board of Trustees
At a meeting held December 3, 1997, the Board of Trustees reviewed
information presented to them regarding the proposed merger and about Investec.
They considered the implications of the merger for Ernst and the Funds.
Information reviewed by the Trustees also included information about Ernst and
each of the Sub-Advisers, information regarding fees paid to Ernst and the
Sub-Advisers and about reimbursements of those fees and information comparing
the Funds' fees and expenses to those of comparable funds. The Trustees received
assurances that the merger would not cause any change in the nature or quality
of services provided by Ernst to the Funds and that there would be no change in
the rate of fees to be paid to Ernst for those services. There also would be no
change in any of the sub-investment advisory arrangements for the Funds. The
Trustees noted that the merger could make available a wider range of
capabilities and resources to Ernst and to its clients which could ultimately
benefit the Funds.
The Trustees were advised that Investec and Ernst would rely on Section
15(f) under the Investment Company Act of 1940 ("1940 Act"), which provides a
non-exclusive safe harbor for an investment adviser to an investment company,
and any affiliated person (as defined in the 1940 Act), to receive any amount or
benefit in connection with a change in control of the investment adviser so long
as two conditions are met. As applicable to the Funds, these conditions are as
follows. First, for a period of three years after the Acquisition, at least 75%
of the Trustees must be persons who are not "interested persons" of Ernst,
either before or after the Acquisition. In this regard, the Trustees noted that
none of the Trustees is, or will be after the Acquisition, affiliated with
Ernst. The second condition requires that, for a period of two years after the
Acquisition, there must not be imposed upon the Funds any "unfair burden" as a
result of the Acquisition or any express or implied terms, conditions or
understandings related to the Acquisition. An "unfair burden" would include any
arrangement whereby Ernst, or any interested person of Ernst, would receive or
be entitled to receive any compensation, directly or indirectly, from the Funds
or their shareholders (other than fees for bona fide investment advisory or
other services) or from any person in connection with the purchase or sale of
securities or other property to, from or on behalf of, the Funds (other than
bona fide ordinary compensation as principal underwriter for the Funds). The
Trustees concluded, based on their review of the information presented at the
meeting, including the terms of the proposed Investment Advisory Agreement and
Sub-Investment Advisory Agreements, that no special compensation arrangements
were contemplated that would impose new burdens on the Funds. They also noted
that Ernst would bear the expenses related to obtaining shareholder approval for
the proposed new Agreements and that no costs regarding the Acquisition would be
imposed on the Funds.
The Trustees reviewed the qualifications of Ernst, KCM and NMFM, and
considered the nature and quality of services that had been, and would continue
to be, provided to the Funds by each of these firms pursuant to the Agreements.
They considered information regarding the Funds' performance relative to the
performance of other comparable funds and market indices. They considered the
rates of compensation payable under the new Agreements and other benefits that
might flow to Ernst, KCM and NMFM as a result of their relationships with the
Funds. They considered the fees and expenses of the Funds relative to those of
other funds for comparable services. The Trustees noted that the terms of the
Agreements would not change, except for the date and term and certain updating
changes, and concluded that the terms of all the Agreements continued to be fair
and reasonable.
In determining to approve the new Agreements, the Trustees placed
particular weight on the desirability of maintaining continuity of service, and
of quality of service, for the Funds and on the fact that there would be no
change in the operative terms of the new Agreements or in the entities providing
investment advisory and sub-investment advisory services to the Funds. The
Trustees, including the non-interested Trustees, therefore unanimously approved
the new Agreements, to take effect upon the effectiveness of the Acquisition,
subject to shareholder approval. They also determined to recommend that
shareholders vote to approve the new Agreements.
PROPOSAL 1
APPROVAL OF NEW INVESTMENT ADVISORY AGREEMENT
The proposed Investment Advisory Agreement between Coventry and Ernst
with respect to the Funds is substantially identical to the current Investment
Advisory Agreement, except for the date and term and the elimination of
references to state expense limitation rules, which are no longer applicable to
the Funds. A copy of the proposed Investment Advisory Agreement is attached as
Exhibit A hereto, and references in the following discussion to that agreement
are qualified in their entirety by reference to Exhibit A. (The current and
proposed Investment Advisory Agreement are referred to in the following
discussion as "Advisory Agreements".)
The Advisory Agreements provide that, subject to the supervision of the
Trustees, Ernst will provide a continuous investment program for the Funds in
accordance with the investment objectives, policies and restrictions of each
Fund and applicable resolutions of the Trustees. Subject to required approval by
the Trustees and shareholders, Ernst is also permitted to retain subadvisers to
provide certain services contemplated by the Advisory Agreements. (See Proposals
2a, 2b and 2c, below.) The appointment of a subadviser does not relieve Ernst of
its obligations under the Advisory Agreements and Ernst has certain
responsibilities for the acts of any subadvisers and for assuring that
subadvisers have the legal authority to provide subadvisory services without
violating applicable law and regulations. The Advisory Agreements acknowledge
that Ernst may provide similar services to others so long as such provision does
not impair its services under the Advisory Agreements.
The Advisory Agreements provide that Ernst will place orders with the
issuer or broker-dealers for the Funds' securities transactions, and in
selecting broker-dealers, will attempt to obtain prompt and effective execution
at the most favorable price. Consistent with this standard, broker-dealers may
be selected who provide research and other services to Ernst. Ernst also agrees
to maintain the Funds' books and records.
Ernst agrees to pay all expenses in connection with its activities
pursuant to the Advisory Agreements, except for the cost of securities and
transactions costs for the Funds. As compensation for its services and expenses
assumed under the Advisory Agreements, Ernst receives fees at the following
annual rates based on the average daily net assets of the Funds: Asia Fund,
1.00%; Resources Fund, 1.00%; Allocation Fund, 1.10%. (Fee rates are also
provided for two series that have never become active and for which no fees have
been paid. Ernst pays the fees to the Sub-Advisers under the Sub-Investment
Advisory Agreements. See Proposals 2a, 2b and 2c.) The current Advisory
Agreement also contains provisions obligating Ernst to reimburse the Funds for a
portion of Fund expenses that are in excess of applicable expense limitations
imposed by a state. This provision is eliminated from the proposed Advisory
Agreement because such state expense limitations are no longer applicable to the
Funds (or, generally, to any registered investment company.)
The Advisory Agreements limit the liability of Ernst for errors of
judgment or mistakes of law or losses suffered by the Funds to cases in which
the loss results from a breach of fiduciary duty with respect to receipt of
compensation for services or from Ernst's willful misfeasance, bad faith or
gross negligence in the performance of its duties, or from Ernst's reckless
disregard of its duties, under the Advisory Agreements. The Advisory Agreements
also provide that the Trustees, shareholders and representatives of the Trust
shall not have personal liability for the obligations of Coventry, which bind
only the assets of particular series of Coventry.
The Advisory Agreements apply to specified series of Coventry in
existence on the date of the Advisory Agreement or subsequently added. After an
initial two-year term, the Advisory Agreements continue with respect to each
Fund provided they are approved at least annually by a majority of the Funds'
disinterested Trustees and by either a majority of the full Board of Trustees or
a majority of the particular Fund's outstanding shares (as defined in the 1940
Act). The Advisory Agreements may be terminated as to a particular Fund at any
time without penalty on sixty days' written notice by vote of the Trustees or a
majority of the Fund's shares, or by Ernst. Each Advisory Agreement will
terminate immediately in the event of its assignment.
The current Advisory Agreement was approved by the Trustees as to Asia
Fund and Resources Fund on October 27, 1995, and as to Allocation Fund, on
February 5, 1996. It was approved by the sole shareholders of Asia Fund and
Resources Fund on December 5, 1995 and by the sole shareholder of Allocation
Fund on July 2, 1996. The current Advisory Agreement was last reapproved by the
Trustees with respect to Asia Fund and Resources Fund at a meeting held February
28, 1997, and with respect to Allocation Fund, at a meeting held November 13,
1997. The following table indicates, for the fiscal year ended March 31, 1997,
fees earned by Ernst for each Fund and the amounts of these fees that were
waived or assumed by Ernst pursuant to a voluntary agreement by Ernst to limit
the Funds' operating expenses:
FUND FEES EARNED FEES WAIVED/ASSUMED
Asia Fund $60,569 $14,717
Resources Fund $102,553 $26,057
Allocation Fund1 $43,877 $0
The Board of Trustees recommends that shareholders of each Fund vote
FOR Proposal 1.
PROPOSALS 2a, 2b AND 2c
APPROVAL OF NEW SUB-INVESTMENT ADVISORY AGREEMENTS
Proposal 2a: Approval of a new Sub-Investment Advisory Agreement between Ernst
and Koeneman Capital Management Pte Ltd., with respect to Asia Fund
Proposal 2b: Approval of a new Sub-Investment Advisory Agreement between Ernst
and National Mutual Funds Management (Global), Ltd., with respect to Resources
Fund
Proposal 2c: Approval of a new Sub-Investment Advisory Agreement between Ernst
and National Mutual Funds Management (Global), Ltd., with respect to Allocation
Fund
Pursuant to authority under the current Advisory Agreement, Ernst has
entered into the following Sub-Advisory Agreements with respect to each of the
Funds: with KCM (dated October 27, 1995) with respect to Asia Fund; with NMFM
(dated October 27, 1997) with respect to Resources Fund; and with NMFM (dated
February 5, 1996) with respect to Allocation Fund. Each of the proposed
Sub-Investment Advisory Agreements is substantially identical to the respective
current Sub-Investment Advisory Agreement, except for the date and term. and,
except as otherwise indicated below, each of the current and proposed
Sub-Investment Advisory Agreements ("Sub-Investment Advisory Agreements) is
similar to the others. A copy of the forms of the proposed Sub-Investment
Advisory Agreement are attached as Exhibits B, C and D hereto, and references in
the following discussion to the proposed Sub-Investment Advisory Agreements are
qualified in their entirety by reference to Exhibits B, C and D, as applicable.
(KCM and NMFM are referred to herein as "Sub-Advisers.")
Each Sub-Adviser is subject to the supervision of Ernst and the
Trustees. Each Sub-Investment Advisory Agreement provides that each Sub-Adviser
will provide a continuous investment program for the respective Fund in
accordance with the investment objectives, policies and restrictions of that
Fund and resolutions of the Trustees. Each Sub-Investment Advisory Agreement
acknowledges that the respective Sub-Adviser may provide similar services to
others so long as such provision does not impair its services under the
Sub-Investment Advisory Agreement.
Each Sub-Investment Advisory Agreement provides that the Sub-Adviser
will place orders with the issuer or broker-dealers for the Funds' securities
transactions, and in selecting broker-dealers, will attempt to obtain prompt and
effective execution at the most favorable price. Consistent with this standard,
broker-dealers may be selected who provide research and other services to the
Sub-Adviser. Each Sub-Adviser also agrees to maintain the respective Fund's
books and records.
The Sub-Investment Advisory Agreement with KCM with respect to Asia
Fund contains additional provisions regarding confidentiality of certain
information, the use of Mitsubishi Global Custody, and the applicability to Fund
transactions of the rules of markets and exchanges on which Fund transactions
are effected. This agreement also provides that if Ernst instructs KCM regarding
Fund transactions, KCM shall have no responsibility for acting in accordance
with those instructions.
Each Sub-Adviser agrees to pay all expenses in connection with its
activities pursuant to the respective Sub-Investment Advisory Agreement, except
for the cost of securities and commodities and related transactions costs for
the particular Fund. As compensation for its services and expenses assumed under
the respective Sub-Investment Advisory Agreement, each Sub-Adviser receives fees
from Ernst at the following annual rates based on the average daily net assets
of the respective Fund: Asia Fund's fees to KCM, 0.60%; Resources Fund's fees to
NMFM, 0.60%; Allocation Fund's fees to NMFM, 0.70%.
The Advisory Agreements limit the liability of Ernst for errors of
judgment or mistakes of law or losses suffered by the Funds to cases in which
the loss results from a breach of fiduciary duty with respect to receipt of
compensation for services or from Ernst's willful misfeasance, bad faith or
gross negligence in the performance of its duties, or from Ernst's reckless
disregard of its duties, under the Advisory Agreements. (The Sub-Investment
Advisory Agreements with NMFM acknowledge that these limitations do not waive or
limit rights that Coventry, the particular Fund or the Adviser may have under
laws that may impose liability on persons who act in good faith.) The
Sub-Investment Advisory Agreements also provide that the Trustees, shareholders
and representatives of the Trust shall not have personal liability for the
obligations of Coventry, which bind only the assets of the particular series of
Coventry.
Each of the Sub-Investment Advisory Agreements provides that the assets
of the particular Fund shall at all times be maintained with the Fund's
custodian. (The Sub-Investment Advisory Agreement with KCM with respect to Asia
Fund additionally specifically clarifies that (a) dividends, interest,
distributions and bonus and scrip issues with respect to the securities of Asia
Fund will be collected by the Fund's custodian and (b) Ernst and the Trustees
will notify KCM as soon as practicable if the total assets of Asia Fund decrease
to less than one million Singapore dollars or the equivalent in another
currency.)
Each Sub-Investment Advisory Agreement provides for an initial two-year
term, and each Sub-Investment Advisory Agreement will continue with respect to
the particular Fund provided it is approved at least annually by a majority of
the Fund's disinterested Trustees and by either a majority of the full Board of
Trustees or a majority of the particular Fund's outstanding shares (as defined
in the 1940 Act). Each Sub-Investment Advisory Agreement may be terminated as to
the particular Fund at any time without penalty on sixty days' written notice by
the Sub-Adviser, by vote of the Trustees or a majority of the Fund's shares, or
by Ernst. Each Sub-Investment Advisory Agreement will terminate immediately in
the event of its assignment.
The current Sub-Investment Advisory Agreements were approved by the
Trustees as to Asia Fund and Resources Fund on October 27, 1995, and as to
Allocation Fund, on February 5, 1996. Each was approved by the sole shareholders
of Asia Fund and Resources Fund on December 5, 1995 and by the sole shareholder
of Allocation Fund on July 2, 1996. The current Sub-Investment Advisory
Agreements for Asia Fund and Resources Fund were last reapproved by the Trustees
at a meeting held February 28, 1997, and the Sub-Investment Advisory Agreement
for Allocation was last reapproved at a meeting held November 13, 1997. The
following table indicates fees for the fiscal year ended March 31, 1997, earned
by each Sub-Adviser for each Fund (which fees are paid by Ernst) and the amounts
of these fees that were waived or assumed by the particular Sub-Adviser.
:
FUND FEES EARNED FEES WAIVED/ASSUMED
Asia Fund (KCM) $36,341 $32,302
Resources Fund (NMFM) $9,918 $7,152
Allocation Fund2 (NMFM) $27,922 $27,922
The Board of Trustees recommends that the shareholders of Asia Fund,
Resources Fund and Allocation Fund, respectively, vote FOR Proposals 2a, 2b and
2c, respectively.
OTHER INFORMATION
Principal Officers and Directors or Partners of Ernst and the Sub-Advisers
The name and principal occupation of the principal executive officers
and directors or principal partners of Ernst, KCM and NMFM are as indicated in
the following table
ERNST
<TABLE>
<CAPTION>
Name Principal Occupation
<S> <C>
William P. Behrens Director and Chief Executive Officer, Ernst
Daniel Cristofano Director and Chief Operating Officer, Ernst
Robert Bonelli Director and Chief Financial Officer, Ernst
Lionel C. Bandler Director and Corporate Secretary, Ernst
Alexander Wohlgemuth Director and Vice Chairman, Ernst
Robert M. Arias Director and Executive Vice President, Ernst
Gery Sperling Director and Executive Vice President, Ernst
G. Thomas Andes Director, Ernst; Chief Executive Officer,
Magna Group, Inc. (1401 S. Brentwood Boulevard, St.
Louis, MO 63144)
William C. Stafford Director, Ernst (525 Cabin Grove Lane, St. Louis MO
63141)
J. William Burdett Director, Ernst; Chairman, Burdett Buckeridge & Young
Ltd. (525 Collins Street, Melbourne, Australia 3000)
</TABLE>
Unless otherwise noted, the address of each Ernst Director is One
Battery Park Plaza, new York, NY 10004.
KCM
<TABLE>
<CAPTION>
Name Principal Occupation
<S> <C>
J. William Burdett Director, KCM; Chairman, Burdett Buckeridge & Young,
Ltd. (525 Collins St., Melbourne, Australia 3000)
GDH Hwee Cheng Director and Secretary, KCM
Liew Geok Kee Director, KCM
John K. Koeneman Chairman and Managing Director, KCM
Pieter Van Wijingaarden Director, KCM; Director NMFM
</TABLE>
NMFM
<TABLE>
<CAPTION>
Name Principal Occupation
<S> <C>
Geoffrey Allan Tomlinson Chief Executive Officer, National Mutual Holdings
Samuel Kavourakis Managing Director, NMFM
Richard John Greenfield Executive Director, Investments, NMFM
Pieter van Wijngaarden Executive Director, Operations, NMFM
Brian John Pollock Executive Director, Property and Lending, NMFM
Edward D. Baker Director, NMFM; Director Alliance Capital Management
(555 California St., San Francisco, CA 94104)
Jean-Pierre Hellebuyck Director, NMFM; Director, AXA Asset Management (16
Avenue Matignon, Paris 75008, France
Clinton Henry Starr Executive Director, Marketing and Sales, NMFM
Lindsay Robert Mann Managing Director, NMFM (Asia) Ltd. (3708 One Pacific
Place, 88 Queensway, Hong Kong)
Yoicho Suzuki Managing Director, NMFM (Japan) Ltd. (1-3-4 Atago
Minato-ku, Tokyo 105, Japan)
Michael Bargholz Managing Director, NMFM (New Zealand) Ltd. (80 The
Terrace, Wellington, New Zealand 6001)
</TABLE>
Unless otherwise indicated, the address of each director of NMFM is 447
Collins Street, Melbourne, Australia 3000.
Administrator and Distributor
The Funds' administrator and distributor is BISYS Fund Services, 3435
Stelzer Road, Columbus, Ohio 43219.
Beneficial Ownership of Shares of the Funds
[to be provided]
Ownership of Fund shares by the Trustees and officers is, in the
aggregate, less than 1% of the outstanding shares of each Fund. [Is this
statement true?].
Shareholder Proposals
Shareholders who wish to submit proposals to be included in a Proxy
Statement for any subsequent meeting of shareholders should send the proposals
in writing to: The Ernst World Funds, 3435 Stelzer Road, Columbus, Ohio 34219
within a reasonable period of time prior to the date on which proxies are
solicited for that meeting.
Timely submission of a proposal does not assure that it will be included.
Other Business
The Trustees are not aware of any matters to be presented at the
Meeting other than those described in this Proxy Statement. In the event that
any such other matters should be brought before the Meeting, each executed proxy
will be deemed to authorize the persons named as proxies in the accompanying
form of proxy to vote on such matters in accordance with their best judgment in
the interest of each Fund.
PLEASE SIGN, DATE AND RETURN THE ENCLOSED PROXY PROMPTLY. NO POSTAGE IS REQUIRED
IF MAILED IN THE UNITED STATES.
By Order of the Board of Trustees
George L. Stevens
Secretary
<PAGE>
EXHIBIT A
INVESTMENT ADVISORY AGREEMENT
AGREEMENT made this ____ day of _________, 1998, between THE COVENTRY
GROUP (the "Trust"), a Massachusetts business trust having its principal place
of business at 3435 Stelzer Road, Columbus, Ohio 43219, and ERNST & COMPANY, a
Delaware corporation (the "Investment Adviser"), having its principal place of
business at One Battery Park Plaza, New York, New York 10004.
WHEREAS, the Trust is registered as an open-end, management investment
company under the Investment Company Act of 1940, as amended (the "1940 Act");
and
WHEREAS, the Trust desires to retain the Investment Adviser to furnish
investment advisory and administrative services to certain investment portfolios
of the Trust and may retain the Investment Adviser to serve in such capacity
with respect to certain additional investment portfolios of the Trust, all as
now or hereafter may be identified in Schedule A hereto as such Schedule may be
amended from time to time (individually referred to herein as a "Fund" and
collectively referred to herein as the "Funds") and the Investment Adviser
represents that it is willing and possesses legal authority to so furnish such
services without violation of applicable laws and regulations;
NOW, THEREFORE, in consideration of the premises and mutual covenants
herein contained, it is agreed between the parties hereto as follows:
1. Appointment. The Trust hereby appoints the Investment Adviser to act as
investment adviser to the Funds for the period and on the terms set forth in
this Agreement. The Investment Adviser accepts such appointment and agrees to
furnish the services herein set forth for the compensation herein provided.
Additional investment portfolios may from time to time be added to those covered
by this Agreement by the parties executing a new Schedule A which shall become
effective upon its execution and shall supersede any Schedule A having an
earlier date.
2. Delivery of Documents. The Trust has furnished the Investment Adviser with
copies properly certified or authenticated of each of the following:
(a) the Trust's Declaration of Trust, dated January 8, 1992, and
filed with the Secretary of State of Massachusetts on January
8, 1992, and any and all amendments thereto or restatements
thereof (such Declaration, as presently in effect and as it
shall from time to time be amended or restated, is herein
called the "Declaration of Trust");
(b) the Trust's By-Laws and any amendments thereto;
(c) resolutions of the Trust's Board of Trustees authorizing the
appointment of the Investment Adviser and approving this
Agreement;
(d) the Trust's Notification of Registration on Form N-8A under
the 1940 Act as filed with the Securities and Exchange
Commission (the "Commission") on January 8, 1992, and all
amendments thereto;
(e) the Trust's Registration Statement on Form N-1A under the
Securities Act of 1933, as amended (the "1933 Act"), and under
the 1940 Act as filed with the Commission and all amendments
thereto; and
(f) the most recent prospectus and Statement of Additional
Information of each of the Funds (such Prospectus and
Statement of Additional Information, as presently in effect,
and all amendments and supplements thereto, are herein
collectively called the "Prospectus").
The Trust will furnish the Investment Adviser from time to time with copies of
all amendments of or supplements to the foregoing.
3. Management; Use of Subadvisers. Subject to the supervision of the Trust's
Board of Trustees, the Investment Adviser will provide a continuous
investment program for the Funds, including investment research and
management with respect to all securities and investments and cash
equivalents in the Funds. Subject to appropriate Board of Trustees and
shareholder approval, the Investment Adviser may enter into a contractual
relationship with one or more subadvisers (each a "Subadviser",
collectively the "Subadvisers") concerning the provision of investment
management services contemplated hereunder; provided, however, that the
Investment Adviser shall not be relieved of its obligations under this
Agreement by the appointment of a Subadviser and shall pay the fees of the
Subadviser, and, provided further, that the Investment Adviser shall be
responsible, to the extent provided in Section 3(a) and Section 8 hereof,
for all acts of any such Subadviser as if such acts were its own. In each
contract that the Investment Adviser enters into with a Subadviser, the
Investment Adviser shall review the activities of each Subadviser for
purposes of ensuring compliance with each of the representations and
warranties contained herein. A Subadviser, subject to the review of the
Adviser, may determine from time to time the securities and other
investments to be purchased, retained or sold by the Funds. The Investment
Adviser and each Subadviser will provide the services under this Agreement
in accordance with each respective Fund's investment objectives, policies,
and restrictions as stated in the Prospectus and resolutions of the Trust's
Board of Trustees. The Investment Adviser further agrees that it:
(a) will use the same skill and care in providing such services as it
uses in providing services to fiduciary accounts for which it has
investment responsibilities.
(b) will conform with all applicable Rules and Regulations of the
Commission under the 1940 Act and in addition will conduct its
activities under this Agreement in accordance with any applicable
regulations of any governmental authority pertaining to the
investment advisory activities of the Investment Adviser;
(c) will place or cause to be placed orders for the Funds either
directly with the issuer or with any broker or dealer. In placing
orders with brokers and dealers, the Investment Adviser will
attempt to obtain prompt execution of orders in an effective
manner at the most favorable price. Consistent with this
obligation and to the extent permitted by the 1940 Act, when the
execution and price offered by two or more brokers or dealers are
comparable, the Investment Adviser may, in its discretion,
purchase and sell portfolio securities to and from brokers and
dealers who provide the Investment Adviser with research advice
and other services. In no instance will portfolio securities be
purchased from or sold to BISYS Fund Services, the Investment
Adviser, any Subadviser or any affiliated person of the Trust,
BISYS Fund Services, any Subadviser or the Investment Adviser,
except to the extent permitted by the 1940 Act and the
Commission;
(d) will maintain or cause to be maintained all books and records
with respect to the securities transactions of the Funds and will
furnish the Trusts Board of Trustees with such periodic and
special reports as the Board may request; and
(e) will treat confidentially and as proprietary information of the
Trust all records and other information relative to the Trust and
the Funds and prior, present, or potential shareholders, and will
not use such records and information for any purpose other than
performance of its responsibilities and duties hereunder, except
after prior notification to and approval in writing by the Trust,
which approval shall not be unreasonably withheld and may not be
withheld where the Investment Adviser may be exposed to civil or
criminal contempt proceedings for failure to comply, when
requested to divulge such information by duly constituted
authorities, or when so requested by the Trust.
4. Services Not Exclusive. The investment management services furnished by the
Investment Adviser hereunder are not to be deemed exclusive, and the
Investment Adviser shall be free to furnish similar services to others so
long as its services under this Agreement are not impaired thereby.
5. Books and Records. In compliance with the requirements of Rule 31a-3 under
the 1940 Act, the Investment Adviser hereby agrees that all records which
it maintains for the Funds are the property of the Trust and further agrees
to surrender promptly to the Trust any of such records upon the Trust's
request. The Investment Adviser further agrees to preserve for the periods
prescribed by Rule 31a-2 under the 1940 Act the records required to be
maintained by Rule 31a-1 under the 1940 Act.
6. Expenses. During the term of this Agreement, the Investment Adviser will
pay all expenses incurred by it in connection with its activities under
this Agreement other than the cost of securities (including brokerage
commissions, if any) purchased for the Funds.
7. Compensation. For the services provided and the expenses assumed pursuant
to this Agreement, each of the Funds will pay the Investment Adviser and
the Investment Adviser will accept as full compensation therefor a fee as
set forth on Schedule A hereto. The obligation of each Fund to pay the
above-described fee to the Investment Adviser will begin as of the date of
the initial public sale of shares in such Fund. The fee attributable to
each Fund shall be the obligation of that Fund and not of any other Fund.
8. Limitation of Liability. The Investment Adviser shall not be liable for any
error of judgment or mistake of law or for any loss suffered by the Funds
in connection with the performance of this Agreement, except a loss
resulting from a breach of fiduciary duty with respect to the receipt of
compensation for services or a loss resulting from willful misfeasance, bad
faith or gross negligence on the part of the Investment Adviser in the
performance of its duties or from reckless disregard by it of its
obligations and duties under this Agreement.
9. Duration and Termination. This Agreement will become effective with respect
to each Fund listed on Schedule A as of the date first written above (or,
if a particular Fund is not in existence on that date, on the date a
registration statement relating to that Fund becomes effective with the
Commission), provided that it shall have been approved by vote of a
majority of the outstanding voting securities of such Fund, in accordance
with the requirements under the 1940 Act, and, unless sooner terminated as
provided herein, shall continue in effect until ____________, 2000.
Thereafter, if not terminated, this Agreement shall continue in effect as
to a particular Fund for successive one-year terms, provided that such
continuance is specifically approved at least annually (a) by the vote of a
majority of those members of the Trust's Board of Trustees who are not
parties to this Agreement or interested persons of any party to this
Agreement, cast in person at a meeting called for the purpose of voting on
such approval, and (b) by the vote of a majority of the Trust's Board of
Trustees or by the vote of a majority of all votes attributable to the
outstanding shares of such Fund. Notwithstanding the foregoing, this
Agreement may be terminated as to a particular Fund at any time on sixty
days' written notice, without the payment of any penalty, by the Trust (by
vote of the Trust's Board of Trustees or by vote of a majority of the
outstanding voting securities of such Fund) or by the Investment Adviser.
This Agreement will immediately terminate in the event of its assignment.
(As used in this Agreement, the terms "majority of the outstanding voting
securities", "interested persons" and "assignment" shall have the same
meanings as ascribed to such terms in the 1940 Act.)
10. Investment Adviser's Representations. The Investment Adviser hereby
represents and warrants that it is willing and possesses all requisite
legal authority to provide the services contemplated by this Agreement
without violation of applicable law and regulations.
11. Amendment of this Agreement. No provision of this Agreement may be changed,
waived, discharged or terminated orally, but only by an instrument in
writing signed by the party against which enforcement of the change,
waiver, discharge or termination is sought.
12. Governing Law. This Agreement shall be governed by and its provisions shall
be construed in accordance with the laws of the Commonwealth of
Massachusetts.
13. Miscellaneous. The names "The Coventry Group" and "Trustees of The Coventry
Group" refer respectively to the Trust created and the Trustees, as
trustees but not individually or personally, acting from time to time under
an Agreement and Declaration of Trust dated as of January 8, 1992, to which
reference is hereby made and a copy of which is on file at the office of
the Secretary of State of The Commonwealth of Massachusetts and elsewhere
as required by law, and to any and all amendments thereto so filed or
hereafter filed. The obligations of "The Coventry Group" entered into in
the name or on behalf thereof by any of the Trustees, representatives or
agents are made not individually, but in such capacities, and are not
binding upon any of the Trustees, shareholders or representatives of the
Trust personally, but bind only the assets of the Trust and all persons
dealing with any series of shares of the Trust must look solely to the
assets of the Trust belonging to such series for the enforcement of any
claims against the Trust.
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this instrument to
be executed by their officers designated below as of the day and year first
above written.
THE COVENTRY GROUP
By:_________________________________________
Name:______________________________________
Title:_______________________________________
ERNST & COMPANY
By:_________________________________________
Name:______________________________________
Title:_______________________________________
<PAGE>
Schedule A
to the
Investment Advisory Agreement
between The Coventry Group and
Ernst & Company
<TABLE>
<CAPTION>
Name of Fund Compensation
<S> <C>
Ernst Asia Fund Annual rate of 1.00% of the average daily net
(Effective __________, 1998) assets of the Fund
Ernst Global Resources Fund Annual are of 1.00% of the average daily net assets
(Effective __________, 1998) of the Fund
Ernst Global Asset Allocation Fund Annual rate of 1.10% of the average daily net
(Effective __________, 1998) assets of the Fund
Ernst Global Smaller Companies Fund Annual rate of 1.10% of the average daily net
(Effective __________, 1998) assets of the Fund
Ernst Australia-New Zealand Fixed Income Fund Annual rate of .60% of the average daily net assets
(Effective __________, 1998) of the Fund
<FN>
- --------------------
All fees are computed daily and payable monthly.
</FN>
</TABLE>
<PAGE>
EXHIBIT B
SUB-ADVISORY AGREEMENT
AGREEMENT made this ____ day of ___________, 1998, between Ernst &
Company (the "Adviser"), and Koeneman Capital Management Pte Ltd (the
"Sub-Adviser").
WHEREAS, The Coventry Group (the "Trust") is registered as an open-end,
management investment company under the Investment Company Act of 1940, as
amended (the "1940 Act"); and
WHEREAS, Ernst Asia Fund (the "Fund") is a separate investment series
of the Trust; and
WHEREAS, the Adviser has been appointed investment adviser to the Fund;
and
WHEREAS, the Adviser desires to retain the Sub-Adviser to assist it in
the provision of a continuous investment program for the Fund and the
Sub-Adviser is willing to do so; and
WHEREAS, the Adviser and the Sub-Adviser are each duly registered with
the Securities and Exchange Commission as investment advisers and their
respective registrations are current and in good order; and
WHEREAS, the Board of Trustees of the Trust and the Fund's shareholders
have approved this Agreement, and the Sub-Adviser is willing to furnish such
services upon the terms and conditions herein set forth;
NOW, THEREFORE, in consideration of the premises and mutual covenants
herein contained, it is agreed between the parties hereto as follows:
1. Appointment. The Adviser hereby appoints the Sub-Adviser to act as
subadviser to the Fund as permitted by the Adviser's Advisory Agreement with the
Trust pertaining to the Fund. Intending to be legally bound, the Sub-Adviser
accepts such appointment and agrees to render the services herein set forth for
the compensation herein provided.
2. Sub-Advisory Services. Subject to the supervision of the Trust's
Board of Trustees, the Sub-Adviser shall assist the Adviser in providing a
continuous investment program with respect to the Fund's portfolio, including
investment research and management with respect to all securities and
investments and cash equivalents in the Fund. The Sub-Adviser may, subject to
the Adviser's review, determine the securities and investments to be purchased,
sold or retained by the Fund, and the Sub-Adviser may place orders directly with
the issuer or any broker or dealer for such securities and investments. The
Sub-Adviser will provide services under this Agreement in accordance with the
Fund's investment objective, policies and restrictions as stated in the Fund's
prospectus and Statement of Additional Information and resolutions of the
Trust's Board of Trustees applicable to the Fund.
Without limiting the generality of the foregoing, the Sub-Adviser
further agrees that it:
(a) will use the same skill and care in providing such
services as it uses in providing services to fiduciary
accounts for which it has investment responsibilities;
(b) will conform with all applicable Rules and Regulations of
the Commission under the 1940 Act and in addition will conduct
its activities under this Agreement in accordance with any
applicable regulations of any governmental authority
pertaining to the investment advisory activities of the
Sub-Adviser;
(c) will place or cause to be placed orders for the Fund
either directly with the issuer or with any broker or dealer.
In placing orders with brokers and dealers, the Sub-Adviser
will attempt to obtain prompt execution of orders in an
effective manner at the most favorable price. Consistent with
this obligation and to the extent permitted by the 1940 Act,
when the execution and price offered by two or more brokers or
dealers are comparable, the Sub-Adviser may, in its
discretion, purchase and sell portfolio securities to and from
brokers and dealers who provide the Sub-Adviser with research
advice and other services. In no instance will portfolio
securities be purchased from or sold to BISYS Fund Services,
the Investment Adviser, the Sub-Adviser or any affiliated
person of the Trust, BISYS Fund Services, the Sub-Adviser or
the Investment Adviser, except to the extent permitted by the
1940 Act and the Commission;
(d) will maintain or cause to be maintained all books and
records with respect to the securities transactions of the
Fund and will furnish the Trust's Board of Trustees with such
periodic and special reports as the Board may request; and
(e) will treat confidentially and as proprietary information
of the Trust all records and other information relative to the
Trust and the Fund and prior, present, or potential
shareholders, and will not use such records and information
for any purpose other than performance of its responsibilities
and duties hereunder, except after prior notification to and
approval in writing by the Trust, which approval shall not be
unreasonably withheld. Such prior written approval will not be
required when the Sub-Adviser may be exposed to civil or
criminal contempt proceedings for failure to comply, when
requested to divulge such information by duly constituted
authorities, or when so requested by the Trust.
In addition, with respect to the services of the Sub-Adviser
as intended under the terms of this Agreement, the parties further agree as
follows:
(f) the Adviser shall not, and shall procure that its
officers, employees and agents shall not, without the prior
consent in writing of the Sub-Adviser and except to the extent
necessary to perform its duties and obligations hereunder,
either directly or indirectly, make a record of, or divulge or
communicate to any person, any information that is or was
acquired by it by reason of this appointment or make use of
any such information for any purpose other than is necessary
for the performance of its duties and obligations hereunder;
(g) all transactions authorized by this agreement shall be
carried out through the Fund's Custodian, Mitsubishi Global
Custody (the "Custodian"), under an account designated 01622.
The Sub-Adviser is authorized to give instructions to the
Custodian with respect to all investment decisions including
the exercise of any rights arising out of the investments in
and regarding the Fund. The Sub-Adviser is also authorized to
give copies of all instructions sent to the Custodian to the
Fund's Administrator, BYSIS Fund Services;
(h) the Adviser may at any time at its own risk give
instructions to the Sub-Adviser regarding the investment of
the assets of the Fund and the Sub-Adviser shall in no
circumstances have any responsibility in respect of any
actions taken in accordance with instructions given by the
Adviser;
(i) all transactions by the Sub-Adviser with any broker,
dealer or issuer for the Fund shall be subject to the rules
and regulations, customs and usages as from time to time in
force of the exchange or market where the transactions are
executed.
3. Services Not Exclusive. Except as provided herein, the services
furnished by the Sub-Adviser hereunder are deemed not to be exclusive, and the
Sub-Adviser shall be free to furnish similar services to others so long as its
services under this Agreement are not impaired thereby.
4. Books and Records. In compliance with the requirements of Rule 31a-3
under the 1940 Act, the Sub-Adviser hereby agrees that all records which it
maintains for the Trust are the property of the Trust and further agrees to
surrender promptly to the Trust any of such records upon the Trust's request.
The Sub-Adviser further agrees to preserve for the periods prescribed by Rule
31a-2 under the 1940 Act the records required to be maintained by Rule 31a-1
under the 1940 Act.
5. Expenses. During the term of this Agreement, the Sub-Adviser will
pay all expenses incurred by it in connection with its activities under this
Agreement other than the cost of securities, commodities and other investments
(including brokerage commissions, taxes, stamp duties, registration charges and
other transaction charges, if any) purchased or sold for the Fund.
6. Compensation. For the services provided and the expenses assumed
with respect to the Fund pursuant to this Agreement, the Sub-Adviser will be
entitled to a fee from the Adviser, computed daily and payable monthly,
calculated at the annual rate of 0.60% of the Fund's average daily net assets.
7. Limitation of Liability. The Sub-Adviser shall not be liable for any
error of judgment or mistake of law or for any loss suffered by the Fund in
connection with the performance of this Agreement, except a loss resulting from
a breach of fiduciary duty with respect to the receipt of compensation for
services or a loss resulting from willful misfeasance, bad faith or gross
negligence on the part of the Sub-Adviser in the performance of its duties or
from reckless disregard by it of its obligations and duties under this
Agreement.
8. Duration and Termination. Unless sooner terminated, this Agreement
shall continue until ____________, 2000, and thereafter shall continue
automatically for successive annual periods, provided such continuance is
specifically approved at least annually by the Trust's Board of Trustees or vote
of the lesser of (a) 67% of the shares of the Fund represented at a meeting if
holders of more than 50 % of the outstanding shares of the Fund are present in
person or by proxy or (b) more than 50 % of the outstanding shares of the Fund,
provided that in either event its continuance also is approved by a majority of
the Trust's Trustees who are not "interested persons" (as defined in the 1940
Act) of any party to this Agreement (the "Independent Trustees"), by vote cast
in person at a meeting called for the purpose of voting on such approval. This
Agreement is terminable at any time without penalty, on 60 days' notice, by the
Adviser, the Sub-Adviser or by the Trust's Board of Trustees or by vote of the
lesser of (a) 67% of the shares of the Fund represented at a meeting if holders
of more than 50 % of the outstanding shares of the Fund are present in person or
by proxy or (b) more than 50 % of the outstanding shares of the Fund. This
Agreement will terminate automatically in the event of its assignment (as
defined in the 1940 Act).
9. Sub-Adviser's Representations. The Sub-Adviser hereby represents and
warrants that it is willing and possesses all requisite legal authority to
provide the services contemplated by this Agreement without violation of
applicable law and regulations.
10. Amendment of this Agreement. No provision of this Agreement may be
changed, waived, discharged or terminated orally, but only by an instrument in
writing signed by the party against which enforcement of the change, waiver,
discharge or termination is sought.
11. Governing Law. This Agreement shall be governed by and its
provisions shall be construed in accordance with the laws of the Commonwealth of
Massachusetts.
12. Asset Size of the Fund. The Adviser and the Trustees of the Trust
shall inform the Sub-Adviser as soon as practicable if the total net assets of
the Fund decrease to less than one million Singapore dollars or its equivalent
in foreign currencies in value.
13. Possession of Fund Assets.
(a) The Sub-Adviser shall not act as
custodian of the Fund and shall at no time receive,
retain or physically control any cash, securities, or
other assets forming any part of the Fund, it being
intended that the responsibility for the safekeeping
hereof, and the consummation of the sales, purchases,
deliveries and investments made pursuant to the
Sub-Adviser's direction shall rest upon the
Custodian, as the Fund's agent.
(b) All dividends, interest, distributions
and all bonus and scrips issues with respect to the
securities held by the Custodian will be collected by
the Custodian and the Sub-Advisor shall have no
responsibility therefor.
14. Miscellaneous. The names The Coventry Group and "Trustees of the
Coventry Group" refer respectively to the Trust created and to the Trustees, as
trustees but not individually or personally, acting from time to time under an
Agreement and Declaration of Trust dated as of January 8, 1992, to which
reference is hereby made and a copy of which is on file at the office of the
Secretary of State of The Commonwealth of Massachusetts and elsewhere as
required by law, and to any and all amendments thereto so filed or hereafter
filed. The obligations of the Trust entered into in the name or on behalf hereof
by any of the Trustees, representatives or agents are made not individually, but
in such capacities, and are not binding upon any of the Trustees, shareholders
or representatives of the Trust personally, but bind only the assets of the
Trust and all persons dealing with any series of shares of the Trust must look
solely to the assets of the Trust belonging to such series for the enforcement
of any claims against the Trust.
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this
instrument to be executed by their officers designated below as of the day and
year first above written.
ERNST & COMPANY
By:____________________________
Name:_________________________
Title:__________________________
KOENEMAN CAPITAL MANAGEMENT
PTE LTD.
By:____________________________
Name:_________________________
Title:__________________________
<PAGE>
EXHIBIT C
SUB-ADVISORY AGREEMENT
AGREEMENT made this ____ day of _________, 1998, between Ernst &
Company (the "Adviser"), and National Mutual Funds Management (Global), Ltd.
(the "Sub-Adviser").
WHEREAS, The Coventry Group (the "Trust") is registered as an open-end,
management investment company under the Investment Company Act of 1940, as
amended (the "1940 Act"); and
WHEREAS, Ernst Global Resources Fund (the "Fund") is a separate
investment series of the Trust; and
WHEREAS, the Adviser has been appointed investment adviser to the Fund;
and
WHEREAS, the Adviser desires to retain the Sub-Adviser to assist it in
the provision of a continuous investment program for the Fund and the
Sub-Adviser is willing to do so; and
WHEREAS, the Board of Trustees of the Trust and the Fund's shareholders
have approved this Agreement, and the Sub-Adviser is willing to furnish such
services upon the terms and conditions herein set forth;
NOW, THEREFORE, in consideration of the premises and mutual covenants
herein contained, it is agreed between the parties hereto as follows:
1. Appointment. The Adviser hereby appoints the Sub-Adviser to act as
sub-adviser to the Fund as permitted by the Adviser's Advisory Agreement with
the Trust pertaining to the Fund. Intending to be legally bound, the Sub-Adviser
accepts such appointment and agrees to render the services herein set forth for
the compensation herein provided.
2. Sub-Advisory Services. Subject to the supervision of the Trust's
Board of Trustees, the Sub-Adviser shall assist the Adviser in providing a
continuous investment program with respect to the Fund's portfolio, including
investment research and management with respect to all securities and
investments and cash equivalents in the Fund. The Sub-Adviser may, subject to
the Adviser's review, determine the securities and investments to be purchased,
sold or retained by the Fund, and the Sub-Adviser may place orders directly with
the issuer or any broker or dealer for such securities and investments. The
Sub-Adviser will provide services under this Agreement in accordance with the
Fund's investment objective, policies and restrictions as stated in the Fund's
prospectus and Statement of Additional Information, which shall be forwarded to
the Sub-Adviser by the Adviser from time to time, and resolutions of the Trust's
Board of Trustees applicable to the Fund provided those resolutions are
communicated to the Sub-Adviser and a reasonable amount of time is provided in
order for it to comply.
Without limiting the generality of the foregoing, the Sub-Adviser
further agrees that it:
(a) will use the same skill and care in providing such
services as it uses in providing services to fiduciary
accounts for which it has investment responsibilities;
(b) will conform with all applicable Rules and Regulations of
the Commission under the 1940 Act applicable to sub-advisers
and to registered investment companies and in addition will
conduct its activities under this Agreement in accordance with
any applicable regulations of any governmental authority
pertaining to the investment advisory activities of the
Sub-Adviser;
(c) will place or cause to be placed orders for the Fund
either directly with the issuer or with any broker or dealer.
In placing orders with brokers and dealers, the Sub-Adviser
will attempt to obtain prompt execution of orders in an
effective manner at the most favorable price. Consistent with
this obligation and to the extent permitted by the 1940 Act,
when the execution and price offered by two or more brokers or
dealers are comparable, the Sub-Adviser may, in its
discretion, purchase and sell portfolio securities to and from
brokers and dealers who provide the Sub-Adviser with research
advice and other services. In no instance will portfolio
securities be purchased from or sold to BISYS Fund Services,
the Investment Adviser, the Sub-Adviser or any affiliated
person of the Trust, BISYS Fund Services, the Sub-Adviser or
the Investment Adviser, except to the extent permitted by the
1940 Act and the Commission;
(d) will maintain or cause to be maintained all books and
records with respect to the securities transactions of the
Fund and will furnish the Trust's Board of Trustees with such
periodic and special reports as the Board may request; and
(e) will treat confidentially and as proprietary information
of the Trust all records and other information relative to the
Trust and the Fund and prior, present, or potential
shareholders, and will not use such records and information
for any purpose other than performance of its responsibilities
and duties hereunder, except after prior notification to and
approval in writing by the Trust, which approval shall not be
unreasonably withheld and may not be withheld where the
Sub-Adviser may be exposed to civil or criminal contempt
proceedings for failure to comply, when requested to divulge
such information by duly constituted authorities, or when so
requested by the Trust.
3. Services Not Exclusive. Except as provided herein, the services
furnished by the Sub-Adviser hereunder are deemed not to be exclusive, and the
Sub-Adviser shall be free to furnish similar services to others so long as its
services under this Agreement are not impaired thereby.
4. Books and Records. In compliance with the requirements of Rule 31a-3
under the 1940 Act, the Sub-Adviser hereby agrees that all records which it
maintains for the Trust are the property of the Trust and further agrees to
surrender promptly to the Trust any of such records upon the Trust's request.
The Sub-Adviser further agrees to preserve for the periods prescribed by Rule
31a-2 under the 1940 Act the records required to be maintained by Rule 31a-1
under the 1940 Act.
5. Expenses. During the term of this Agreement, the Sub-Adviser will
pay all expenses incurred by it in connection with its activities under this
Agreement other than the cost of securities, commodities and other investments
(including brokerage commissions and other transaction charges, if any)
purchased for the Fund.
6. Compensation. For the services provided and the expenses assumed
with respect to the Fund pursuant to this Agreement, the Sub-Adviser will be
entitled to a fee from the Adviser, computed daily and payable monthly,
calculated at the annual rate of 0.60% of the Fund's average daily net assets.
Such fee shall be payable in Australian dollars and shall be delivered to the
Sub-Adviser at its principal place of business (or to a specified bank account)
promptly after the end of each month.
7. Limitation of Liability. The Sub-Adviser shall not be liable for any
error of judgment or mistake of law or for any loss suffered by the Fund in
connection with the performance of this Agreement, except a loss resulting from
a breach of fiduciary duty with respect to the receipt of compensation for
services or a loss resulting from willful misfeasance, bad faith or gross
negligence on the part of the Sub-Adviser in the performance of its duties or
from reckless disregard by it of its obligations and duties under this
Agreement. Notwithstanding the foregoing or any other provision of this
Agreement, nothing herein shall in any way constitute a waiver or limitation of
any rights that the Trust, the Fund or the Adviser may have under the United
States federal or State securities laws, which may impose liability on persons
who act in good faith.
8. Duration and Termination. Unless sooner terminated, this Agreement
shall continue until __________, 2000, and thereafter shall continue
automatically for successive annual periods, provided such continuance is
specifically approved at least annually by the Trust's Board of Trustees or vote
of the lesser of (a) 67% of the shares of the Fund represented at a meeting if
holders of more than 50 % of the outstanding shares of the Fund are present in
person or by proxy or (b) more than 50 % of the outstanding shares of the Fund,
provided that in either event its continuance also is approved by a majority of
the Trust's Trustees who are not "interested persons" (as defined in the 1940
Act) of any party to this Agreement (the "Independent Trustees"), by vote cast
in person at a meeting called for the purpose of voting on such approval. This
Agreement is terminable at any time without penalty, on 60 days' notice, by the
Adviser, the Sub-Adviser or by the Trust's Board of Trustees or by vote of the
lesser of (a) 67% of the shares of the Fund represented at a meeting if holders
of more than 50 % of the outstanding shares of the Fund are present in person or
by proxy or (b) more than 50 % of the outstanding shares of the Fund. This
Agreement will terminate automatically in the event of its assignment (as
defined in the 1940 Act).
9. Amendment of this Agreement. No provision of this Agreement may be
changed, waived, discharged or terminated orally, but only by an instrument in
writing signed by the party against which enforcement of the change, waiver,
discharge or termination is sought.
10. Governing Law. This Agreement shall be governed by and its
provisions shall be construed in accordance with the laws of the Commonwealth of
Massachusetts.
11. Possession of Fund Assets. At all times the assets of the Fund
(consisting of all cash, securities and other instruments held by the Fund)
shall remain exclusively under the management and control of the Fund's
custodian. At no time will the Sub-Adviser have custody or possession of any
such assets of the Fund.
12. Miscellaneous. The names The Coventry Group and "Trustees of the
Coventry Group" refer respectively to the Trust created and to the Trustees, as
trustees but not individually or personally, acting from time to time under an
Agreement and Declaration of Trust dated as of January 8, 1992, to which
reference is hereby made and a copy of which is on file at the office of the
Secretary of State of The Commonwealth of Massachusetts and elsewhere as
required by law, and to any and all amendments thereto so filed or hereafter
filed. The obligations of the Trust entered into in the name or on behalf hereof
by any of the Trustees, representatives or agents are made not individually, but
in such capacities, and are not binding upon any of the Trustees, shareholders
or representatives of the Trust personally, but bind only the assets of the
Trust and all persons dealing with any series of shares of the Trust must look
solely to the assets of the Trust belonging to such series for the enforcement
of any claims against the Trust.
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this
instrument to be executed by their officers designated below as of the day and
year first above written.
ERNST & COMPANY
By:____________________________
Name:_________________________
Title:__________________________
NATIONAL MUTUAL FUNDS MANAGEMENT
(GLOBAL), LTD.
By:____________________________
Name:_________________________
Title:__________________________
<PAGE>
EXHIBIT D
SUB-ADVISORY AGREEMENT
AGREEMENT made this ____ day of _________, 1998, between Ernst &
Company (the "Adviser"), and National Mutual Funds Management (Global), Ltd.
(the "Sub-Adviser").
WHEREAS, The Coventry Group (the "Trust") is registered as an open-end,
management investment company under the Investment Company Act of 1940, as
amended (the "1940 Act"); and
WHEREAS, Ernst Global Asset Allocation Fund (the "Fund") is a separate
investment series of the Trust; and
WHEREAS, the Adviser has been appointed investment adviser to the Fund;
and
WHEREAS, the Adviser desires to retain the Sub-Adviser to assist it in
the provision of a continuous investment program for the Fund and the
Sub-Adviser is willing to do so; and
WHEREAS, the Board of Trustees of the Trust and the Fund's shareholders
have approved this Agreement, and the Sub-Adviser is willing to furnish such
services upon the terms and conditions herein set forth;
NOW, THEREFORE, in consideration of the premises and mutual covenants
herein contained, it is agreed between the parties hereto as follows:
1. Appointment. The Adviser hereby appoints the Sub-Adviser to
act as sub-adviser to the Fund as permitted by the Adviser's Advisory Agreement
with the Trust pertaining to the Fund. Intending to be legally bound, the
Sub-Adviser accepts such appointment and agrees to render the services herein
set forth for the compensation herein provided.
2. Sub-Advisory Services. Subject to the supervision of the
Trust's Board of Trustees, the Sub-Adviser shall assist the Adviser in providing
a continuous investment program with respect to the Fund's portfolio, including
investment research and management with respect to all securities and
investments and cash equivalents in the Fund. The Sub-Adviser may, subject to
the Adviser's review, determine the securities and investments to be purchased,
sold or retained by the Fund, and the Sub-Adviser may place orders directly with
the issuer or any broker or dealer for such securities and investments. The
Sub-Adviser will provide services under this Agreement in accordance with the
Fund's investment objective, policies and restrictions as stated in the Fund's
prospectus and Statement of Additional Information, which shall be forwarded to
the Sub-Adviser by the Adviser from time to time, and resolutions of the Trust's
Board of Trustees applicable to the Fund provided those resolutions are
communicated to the Sub-Adviser and a reasonable amount of time is provided in
order for it to comply.
Without limiting the generality of the foregoing, the Sub-Adviser
further agrees that it:
(a) will use the same skill and care in providing such
services as it uses in providing services to fiduciary
accounts for which it has investment responsibilities;
(b) will conform with all applicable Rules and Regulations of
the Commission under the 1940 Act applicable to sub-advisers
and to registered investment companies and in addition will
conduct its activities under this Agreement in accordance with
any applicable regulations of any governmental authority
pertaining to the investment advisory activities of the
Sub-Adviser;
(c) will place or cause to be placed orders for the Fund
either directly with the issuer or with any broker or dealer.
In placing orders with brokers and dealers, the Sub-Adviser
will attempt to obtain prompt execution of orders in an
effective manner at the most favorable price. Consistent with
this obligation and to the extent permitted by the 1940 Act,
when the execution and price offered by two or more brokers or
dealers are comparable, the Sub-Adviser may, in its
discretion, purchase and sell portfolio securities to and from
brokers and dealers who provide the Sub-Adviser with research
advice and other services. In no instance will portfolio
securities be purchased from or sold to BISYS Fund Services,
the Investment Adviser, the Sub-Adviser or any affiliated
person of the Trust, BISYS Fund Services, the Sub-Adviser or
the Investment Adviser, except to the extent permitted by the
1940 Act and the Commission;
(d) will maintain or cause to be maintained all books and
records with respect to the securities transactions of the
Fund and will furnish the Trust's Board of Trustees with such
periodic and special reports as the Board may request; and
(e) will treat confidentially and as proprietary information
of the Trust all records and other information relative to the
Trust and the Fund and prior, present, or potential
shareholders, and will not use such records and information
for any purpose other than performance of its responsibilities
and duties hereunder, except after prior notification to and
approval in writing by the Trust, which approval shall not be
unreasonably withheld and may not be withheld where the
Sub-Adviser may be exposed to civil or criminal contempt
proceedings for failure to comply, when requested to divulge
such information by duly constituted authorities, or when so
requested by the Trust.
3. Services Not Exclusive. Except as provided herein, the services
furnished by the Sub-Adviser hereunder are deemed not to be exclusive, and the
Sub-Adviser shall be free to furnish similar services to others so long as its
services under this Agreement are not impaired thereby.
4. Books and Records. In compliance with the requirements of Rule 31a-3
under the 1940 Act, the Sub-Adviser hereby agrees that all records which it
maintains for the Trust are the property of the Trust and further agrees to
surrender promptly to the Trust any of such records upon the Trust's request.
The Sub-Adviser further agrees to preserve for the periods prescribed by Rule
31a-2 under the 1940 Act the records required to be maintained by Rule 31a-1
under the 1940 Act.
5. Expenses. During the term of this Agreement, the Sub-Adviser will
pay all expenses incurred by it in connection with its activities under this
Agreement other than the cost of securities, commodities and other investments
(including brokerage commissions and other transaction charges, if any)
purchased for the Fund.
6. Compensation. For the services provided and the expenses assumed
with respect to the Fund pursuant to this Agreement, the Sub-Adviser will be
entitled to a fee from the Adviser, computed daily and payable monthly,
calculated at the annual rate of 0.70% of the Fund's average daily net assets.
Such fee shall be payable in Australian dollars and shall be delivered to the
Sub-Adviser at its principal place of business (or to a specified bank account)
promptly after the end of each month.
7. Limitation of Liability. The Sub-Adviser shall not be liable for any
error of judgment or mistake of law or for any loss suffered by the Fund in
connection with the performance of this Agreement, except a loss resulting from
a breach of fiduciary duty with respect to the receipt of compensation for
services or a loss resulting from willful misfeasance, bad faith or gross
negligence on the part of the Sub-Adviser in the performance of its duties or
from reckless disregard by it of its obligations and duties under this
Agreement. Notwithstanding the foregoing or any other provision of this
Agreement, nothing herein shall in any way constitute a waiver or limitation of
any rights that the Trust, the Fund or the Adviser may have under the United
States federal or State securities laws, which may impose liability on persons
who act in good faith.
8. Duration and Termination. Unless sooner terminated, this Agreement
shall continue until __________, 2000, and thereafter shall continue
automatically for successive annual periods, provided such continuance is
specifically approved at least annually by the Trust's Board of Trustees or vote
of the lesser of (a) 67% of the shares of the Fund represented at a meeting if
holders of more than 50 % of the outstanding shares of the Fund are present in
person or by proxy or (b) more than 50 % of the outstanding shares of the Fund,
provided that in either event its continuance also is approved by a majority of
the Trust's Trustees who are not "interested persons" (as defined in the 1940
Act) of any party to this Agreement (the "Independent Trustees"), by vote cast
in person at a meeting called for the purpose of voting on such approval. This
Agreement is terminable at any time without penalty, on 60 days' notice, by the
Adviser, the Sub-Adviser or by the Trust's Board of Trustees or by vote of the
lesser of (a) 67% of the shares of the Fund represented at a meeting if holders
of more than 50 % of the outstanding shares of the Fund are present in person or
by proxy or (b) more than 50 % of the outstanding shares of the Fund. This
Agreement will terminate automatically in the event of its assignment (as
defined in the 1940 Act).
9. Amendment of this Agreement. No provision of this Agreement may be
changed, waived, discharged or terminated orally, but only by an instrument in
writing signed by the party against which enforcement of the change, waiver,
discharge or termination is sought.
10. Governing Law. This Agreement shall be governed by and its
provisions shall be construed in accordance with the laws of the Commonwealth of
Massachusetts.
11. Possession of Fund Assets. At all times the assets of the Fund
(consisting of all cash, securities and other instruments held by the Fund)
shall remain exclusively under the management and control of the Fund's
custodian. At no time will the Sub-Adviser have custody or possession of any
such assets of the Fund.
12. Miscellaneous. The names The Coventry Group and "Trustees of the
Coventry Group" refer respectively to the Trust created and to the Trustees, as
trustees but not individually or personally, acting from time to time under an
Agreement and Declaration of Trust dated as of January 8, 1992, to which
reference is hereby made and a copy of which is on file at the office of the
Secretary of State of The Commonwealth of Massachusetts and elsewhere as
required by law, and to any and all amendments thereto so filed or hereafter
filed. The obligations of the Trust entered into in the name or on behalf hereof
by any of the Trustees, representatives or agents are made not individually, but
in such capacities, and are not binding upon any of the Trustees, shareholders
or representatives of the Trust personally, but bind only the assets of the
Trust and all persons dealing with any series of shares of the Trust must look
solely to the assets of the Trust belonging to such series for the enforcement
of any claims against the Trust.
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this
instrument to be executed by their officers designated below as of the day and
year first above written.
ERNST & COMPANY
By:____________________________
Name:_________________________
Title:__________________________
NATIONAL MUTUAL FUNDS MANAGEMENT
(GLOBAL), LTD.
By:____________________________
Name:_________________________
Title:__________________________
<PAGE>
ERNST ASIA FUND
This Proxy is solicited by the Board of Directors of The Coventry Group
Special Meeting of Shareholders
January 14, 1998, 9:00 a.m. Eastern Time
The undersigned hereby revokes all previous proxies for his or her shares and
appoints [name of proxies], with power of substitution, as Proxies, and hereby
authorizes them to vote as designated below, as effectively as the undersigned
could do if personally present, all the shares of Ernst Asia Fund held of record
by the undersigned on December 5, 1997, at the Special Meeting of Shareholders,
or any adjournment thereof, to be held at 9:00 a.m. Eastern Time on January 14,
1998 at the offices of BISYS Fund Services, Inc., 3435 Stelzer Road, Columbus,
Ohio 43219.
Please sign exactly as your name or names appear below.
Where shares are held by joint tenants, both should sign. If
signing as attorney, executor, trustee, or in any other
representative capacity, or as a corporate officer, please
give full title. Please date the proxy.
--------------------------------
Signature
--------------------------------
Signature (if held jointly)
--------------------------------
Date
<PAGE>
This Proxy is solicited on behalf of the Board of Trustees, and when properly
executed, will be voted as specified. If no specification is made, the
undersigned's vote, as a shareholder of Ernst Asia Fund, will be cast FOR
Proposal 1 and FOR Proposal 2a. If any other matters properly come before the
meeting of which the Trustees were not aware a reasonable time before the
solicitation of proxies, the undersigned hereby authorizes the Proxies to vote
in their discretion on such matters. The undersigned acknowledges receipt of the
Notice of Meeting and Proxy Statement dated [date].
1. Approval of new Investment Advisory Agreement between The Coventry Group
and Ernst & Company
FOR _________ AGAINST ____________ ABSTAIN __________
2a. Approval of new Sub-Investment Advisory Agreement between Ernst & Company
and Koeneman Capital Management Pte Ltd., with respect to Ernst Asia Fund.
FOR _________ AGAINST ____________ ABSTAIN __________
/_/ Check here if you plan to attend the Meeting. _______ persons.
<PAGE>
ERNST GLOBAL RESOURCES FUND
This Proxy is solicited by the Board of Directors of The Coventry Group
Special Meeting of Shareholders
January 14, 1998, 9:00 a.m. Eastern Time
The undersigned hereby revokes all previous proxies for his or her shares and
appoints [name of proxies], with power of substitution, as Proxies, and hereby
authorizes them to vote as designated below, as effectively as the undersigned
could do if personally present, all the shares of Ernst Global Resources Fund
held of record by the undersigned on December 5, 1997, at the Special Meeting of
Shareholders, or any adjournment thereof, to be held at 9:00 a.m. Eastern Time
on January 14, 1998 at the offices of BISYS Fund Services, Inc., 3435 Stelzer
Road, Columbus, Ohio 43219.
Please sign exactly as your name or names appear below.
Where shares are held by joint tenants, both should sign. If
signing as attorney, executor, trustee, or in any other
representative capacity, or as a corporate officer, please
give full title. Please date the proxy.
--------------------------------
Signature
--------------------------------
Signature (if held jointly)
--------------------------------
Date
<PAGE>
This Proxy is solicited on behalf of the Board of Trustees, and when properly
executed, will be voted as specified. If no specification is made, the
undersigned's vote, as a shareholder of Ernst Global Resources Fund, will be
cast FOR Proposal 1 and FOR Proposal 2b. If any other matters properly come
before the meeting of which the Trustees were not aware a reasonable time before
the solicitation of proxies, the undersigned hereby authorizes the Proxies to
vote in their discretion on such matters. The undersigned acknowledges receipt
of the Notice of Meeting and Proxy Statement dated [date].
1. Approval of new Investment Advisory Agreement between The Coventry Group
and Ernst & Company
FOR _________ AGAINST ____________ ABSTAIN __________
2b. Approval of new Sub-Investment Advisory Agreement between Ernst & Company
and National Mutual Funds Management (Global) Ltd., with respect to Ernst Global
Resources Fund.
FOR _________ AGAINST ____________ ABSTAIN __________
/_/ Check here if you plan to attend the Meeting. _______ persons.
<PAGE>
ERNST GLOBAL ASSET ALLOCATION FUND This
Proxy is solicited by the Board of Directors of The Coventry Group
Special Meeting of Shareholders
January 14, 1998, 9:00 a.m. Eastern Time
The undersigned hereby revokes all previous proxies for his or her shares and
appoints [name of proxies], with power of substitution, as Proxies, and hereby
authorizes them to vote as designated below, as effectively as the undersigned
could do if personally present, all the shares of Ernst Global Asset Allocation
Fund held of record by the undersigned on December 5, 1997, at the Special
Meeting of Shareholders, or any adjournment thereof, to be held at 9:00 a.m.
Eastern Time on January 14, 1998 at the offices of BISYS Fund Services, Inc.,
3435 Stelzer Road, Columbus, Ohio 43219.
Please sign exactly as your name or names appear below.
Where shares are held by joint tenants, both should sign. If
signing as attorney, executor, trustee, or in any other
representative capacity, or as a corporate officer, please
give full title. Please date the proxy.
--------------------------------
Signature
--------------------------------
Signature (if held jointly)
--------------------------------
Date
<PAGE>
This Proxy is solicited on behalf of the Board of Trustees, and when properly
executed, will be voted as specified. If no specification is made, the
undersigned's vote, as a shareholder of Ernst Global Asset Allocation Fund, will
be cast FOR Proposal 1 and FOR Proposal 2c. If any other matters properly come
before the meeting of which the Trustees were not aware a reasonable time before
the solicitation of proxies, the undersigned hereby authorizes the Proxies to
vote in their discretion on such matters. The undersigned acknowledges receipt
of the Notice of Meeting and Proxy Statement dated [date].
1. Approval of new Investment Advisory Agreement between The Coventry Group
and Ernst & Company
FOR _________ AGAINST ____________ ABSTAIN __________
2c. Approval of new Sub-Investment Advisory Agreement between Ernst & Company
and National Mutual Funds Management (Global) Ltd., with respect to Ernst Global
Asset Allocation Fund.
FOR _________ AGAINST ____________ ABSTAIN __________
/_/ Check here if you plan to attend the Meeting. _______ persons.
