AMT Capital Fund, Inc.
430 Park Avenue
17th Floor
New York, New York 10022
International Equity Portfolio
Notice Of Special Meeting Of Shareholders
To Be Held On May 17, 1995
A special meeting of the shareholders (_Shareholders") of the International
Equity Portfolio (the_Portfolio_) of AMT Capital Fund, Inc. (the _Fund_) will
be held at the Fund's offices at 430 Park Avenue, 17th Floor, New York,
New York 10022 on May 17, 1995 at 10:00 a.m. Eastern Time for the following
purposes:
(1) To approve or disapprove a new investment advisory agreement between
the Fund, on behalf of the Portfolio, and Harding, Loevner Management, L.P.; and
(2) To transact such other business as may properly come before the meeting.
The matters referred to above are discussed in detail in the proxy
statement attached to this notice. The Board of Directors has fixed March 27,
1995 (the "Record Date") as the record date for determination of Shareholders
entitled to vote at the meeting.
You are cordially invited to attend the meeting. All Shareholders are
requested to complete, date and sign the enclosed form of proxy and return it
promptly. This proxy is being solicited on behalf of the Board of Directors.
By Order of the Board of Directors
William E. Vastardis
Secretary
April 3, 1995
SIGN, DATE AND RETURN THE ENCLOSED PROXY
PROMPTLY TO AVOID ADDITIONAL EXPENSE
AMT Capital Fund, Inc.
International Equity Portfolio
PROXY STATEMENT
Special Meeting of Shareholders
to be held on May 17, 1995
The enclosed proxy is solicited on behalf of the Board of Directors of
AMT Capital Fund, Inc. (the "Fund") with respect to a special meeting (the
"Meeting") of shareholders (the "Shareholders") of the Fund's International
Equity Portfolio (the "Portfolio"). Such proxy is revocable at any time before
it is voted by sending written notice of the revocation to the Fund, attention
Secretary, or by appearing personally at the Meeting. The cost of preparing
and mailing the notice of meeting, proxy card, this proxy statement and any
additional proxy materials has been or is to be borne by the Fund. The enclosed
notice of meeting, proxy card and this proxy statement will be first mailed to
Shareholders on or about April 3, 1995.
PORTFOLIO INFORMATION
Shareholder Information. As of March 15, 1995, the Portfolio had
outstanding _____________ shares of common stock representing a total net
asset value of $_____________, each share being entitled to one vote.
As of March 15, 1995, the following persons owned of record or beneficially
5% or more of the shares of common stock of the Portfolio:
Name and Address Amount and Nature Percent
of Beneficial Owner of Beneficial Ownership of Class
The most recent annual and semi-annual reports of the Fund, including
financial statements, have been previously mailed to shareholders. If you did
not receive the reports, or would like to receive additional copies free of
charge, please write to AMT Capital Services, Inc., the Fund's administrator and
distributor ("AMT Capital"), at 430 Park Avenue, New York, New York 10022, or
call AMT Capital at (212) 308-4848 or (800) 762-4845.
Investment Adviser and Sub-Adviser. The Fund_s offices are located at 430
Park Avenue, New York, New York 10022. The Portfolio's investment adviser is
AMT Capital Advisers, Inc., a registered investment adviser with offices at
430 Park Avenue, New York, New York 10022 ("AMT Capital Advisers"). Pursuant
to its investment advisory agreement with the Fund, dated April 29, 1994 (the
"Advisory Agreement"), AMT Capital Advisers provides the Portfolio with business
and asset management services, including selecting, evaluating, and
monitoring the sub-adviser to the Portfolio, Harding, Loevner Management, L.P.
("HLM"). HLM is employed and supervised by AMT Capital Advisers, subject to
approval by the Board of Directors of the Fund and the Shareholders. HLM is a
global equity specialist managing in excess of $350 million for private
investors, foundations and endowments. HLM has discretion to purchase and sell
securities for the Portfolio in accordance with the Portfolio's investment
objective, policies and restrictions.
Alan M. Trager, President and a Director of the Fund, serves as President
and Director of AMT Capital Advisers. Carla E. Dearing, Vice President of the
Fund, serves as Senior Vice President and Principal of AMT Capital Advisers.
Distributor and Administrator. AMT Capital Services, Inc., 430 Park
Avenue, New York, New York 10022, serves as the Portfolio's distributor and
administrator ("AMT Capital").
PROXY PROCEDURES
Timely, properly executed proxies will be voted as Shareholders instruct.
Unless instructions to the contrary are marked, proxies will be voted FOR the
proposals set forth in the attached notice.
The presence in person or by proxy of the holders of a majority of the
outstanding shares of the Portfolio is required to constitute a quorum at the
Meeting. Shares held by Shareholders present in person or represented by
proxy at the Meeting will be counted both for the purpose of determining the
presence of a quorum and for calculating the votes cast on the issues before the
Meeting. Abstentions will also be counted for quorum purposes.
Broker or nominee "non-votes" (that is, proxies from brokers or nominees
indicating that such persons have not received instructions from the beneficial
owner or other persons entitled to vote shares on a particular matter with
respect to which the brokers or nominees do not have discretionary power) will
have the same effect as abstentions in determining whether a proposal has
received the requisite approval. Where the broker or nominee has no discretion
to vote the shares as to one or more proposals before the Meeting,
the non-voted shares will be excluded from the pool of shares voted on such
proposals. Thus, abstentions and non-votes will have the same effect as a
negative vote on proposals requiring the affirmative vote of a specified
portion of the Portfolio's outstanding shares, but will not be considered votes
cast and thus will have no effect on matters requiring approval of a
specified percentage of votes cast.
In the event that a quorum is present at the Meeting but sufficient votes
to approve any proposal are not received, the persons named as proxies may
propose one or more adjournments of the Meeting to permit further
solicitation of proxies. Any such adjournment will require the affirmative vote
of a majority of those shares represented at the Meeting in person or by proxy.
If a quorum is present, the persons named as proxies will vote those proxies
which they are entitled to vote FOR the proposal in favor of such an adjournment
and will vote those proxies required to be voted AGAINST the proposal against
any such adjournment. A vote of the Shareholders may be taken on one or more of
the proposals in this proxy statement prior to any adjournment if sufficient
votes have been received for approval.
Approval of Proposal One requires the vote of a "majority of the
outstanding voting securities" of the Portfolio as defined in the Investment
Company Act of 1940, as amended (the "1940 Act"), which means the vote of 67%
or more of the shares of the Portfolio present at the Meeting (if the holders of
more than 50% of the outstanding shares are present or represented by proxy), or
the vote of more than 50% of the outstanding shares of the Portfolio, whichever
is less.
PROPOSAL ONE:
APPROVAL OR DISAPPROVAL OF A NEW INVESTMENT ADVISORY AGREEMENT BETWEEN THE
FUND, ON BEHALF OF THE PORTFOLIO, AND HLM
AMT Capital Advisers currently serves as investment adviser to the
Portfolio pursuant to the Advisory Agreement. HLM serves as the sub-adviser to
the Portfolio pursuant to a sub-advisory agreement with AMT Capital Advisers,
dated April 29, 1994 (the "Sub-Advisory Agreement"). The Advisory and
Sub-Advisory Agreements were last approved by the Board of Directors of the Fund
on February 22, 1995 and by the sole Shareholder of the Portfolio on May 2,
1994. Pursuant to the Advisory Agreement, AMT Capital Advisers is responsible
for, or must engage a third party for the purpose of, managing the investment
portfolio of the Portfolio. Under the Sub-Advisory Agreement, subject to the
supervision and approval of AMT Capital Advisers, HLM is responsible for
providing investment research and advice, determining which portfolio
securities shall be purchased or sold by the Portfolio, purchasing and selling
securities on behalf of the Portfolio and determining how voting and other
rights with respect to the portfolio securities of the Portfolio are
exercised in accordance with the Portfolio's investment objective, policies and
restrictions.
At the Meeting, Shareholders will be asked to approve a new investment
advisory agreement (the "Proposed Advisory Agreement") between the Fund, on
behalf of the Portfolio, and HLM. The Proposed Advisory Agreement would
replace the current Advisory and Sub-Advisory Agreements. The terms and
conditions of the Proposed Advisory Agreement are substantially similar to
those of the Advisory and Sub-Advisory Agreements and, except for the
elimination of AMT Capital Advisers' supervision of HLM and discontinuation
of certain performance fee arrangements discussed below, approval of the
Proposed Advisory Agreement is not expected to result in any material change in
the overall management or operations of the Portfolio. As is the case
currently under the Advisory and Sub-Advisory Agreements, HLM will continue to
be responsible for making day-to-day investment decisions on behalf of the
Portfolio and for purchasing and selling portfolio securities on behalf of
the Portfolio.
The following summary provides information about HLM, and a comparison of
the terms and conditions of the current Advisory and Sub-Advisory Agreements
with the Proposed Advisory Agreement. Please see the section of this Proxy
Statement entitled "Evaluation of Proposal and Recommendation by the
Directors" for information regarding the deliberations of the Board of Directors
of the Fund concerning approval of the Proposed Advisory Agreement.
Background Information Regarding HLM
HLM, located at 50 Division Street, Somerville, New Jersey 08876, is a
registered investment adviser organized in 1989. HLM specializes in global
investment advisory services to private investors, foundations and endowments,
and has been the sub-adviser to the Portfolio since April 29, 1994. As of
December 31, 1994, HLM had in excess of $350 million under management.
HLM is a limited partnership whose general partner is HLM Holdings, Inc.
("HLM Holdings"). The shareholders of HLM Holdings are Daniel D. Harding,
David, R. Loevner and Simon Hallett, who are also all directors of HLM Holdings.
Messrs. Harding, Loevner and Hallett own approximately 95% of the shares
of HLM Holdings. HLM Holdings' address is 50 Division Street, Somerville,
New Jersey 08876.
Daniel D. Harding is the Chief Investment Officer of HLM. Prior to
founding the firm, Mr. Harding served for ten years as a senior investment
manager with Rockefeller & Co., the private investment firm that advises the
Rockefeller family and related charities. At Rockefeller, he set equity and
fixed income investment strategy and spearheaded the international
diversification of the firm's investments. Mr. Harding graduated with honors
from Colgate University and is a Chartered Financial Analyst.
Simon Hallett is Senior Portfolio Manager and Principal of HLM. Prior to
joining the firm in 1991, Mr. Hallett served seven years with Jardine Fleming
Investment Management where he was director in charge of a team of six portfolio
managers investing in the markets of Southeast and North Asia. Mr. Hallett
graduated with honors from Oxford University.
David R. Loevner is Chief Executive Officer of HLM. Mr. Loevner's prior
experience includes nine years with the Rockefeller family office, where he
managed equity portfolios and developed new financial planning and asset
allocation techniques. In 1987, he relocated to Hong Kong to open Rockefeller's
first Asian office and manage a regional investment program comprising both
quoted and private venture investments. Before joining Rockefeller, Mr. Loevner
was an economist with the World Bank. He graduated summa cum laude from
Princeton University and, as a Sachs scholar, received graduate degrees from
Oxford University.
HLM uses a "bottom up" approach to international equity investment. This
approach seeks to identify companies with excellent long-term business
prospects, and then to select from among them those whose stocks appear to offer
attractive absolute returns. HLM's investment criteria include both growth and
value considerations. HLM seeks companies that it believes have strong balance
sheets, sustainable internal growth, superior financial returns and defensible
business franchises. Typically, HLM will only invest in companies that it has
analyzed for a number of years. Country allocation and sector weightings
reflect the results of stock selection, which is itself strongly influenced by
HLM's cyclical and secular outlook for various industries, sectors, and
national economies. Explicit country or sector allocation decisions are taken
only when necessary to ensure that portfolios are well diversified.
Messrs. Harding, Hallet and Loevner currently serve as portfolio managers
of the Portfolio pursuant to the Advisory and Sub-Advisory Agreements, and would
continue to serve as portfolio managers of the
Portfolio under the Proposed Advisory Agreement.
HLM also serves as sub-adviser to the following registered investment
companies:
Registered Approximate Sub-Advisory
Investment Net Assets Fee
Company as of March 1, 1995 (annual rate)
St. James International 0.50%
Equity Portfolio
Stalwart International 0.60%
Equity Fund
Terms and Conditions of the Current and Proposed Advisory Agreements
Shareholders are not being asked to approve the continuation of the
Advisory or Sub-Advisory Agreements, which will each continue in the event that
Proposal One is not approved by Shareholders. Only the Proposed Advisory
Agreement is being submitted for Shareholder approval.
The proposed Advisory Agreement is substantially similar to the current
Advisory and Sub-Advisory Agreements except for i) the effective and termination
dates, ii) the elimination of the adviser - sub-adviser relationship and
iii) the removal of the existing performance adjustment to the advisory fee.
Basic Terms. The Advisory Agreement and Sub-Advisory Agreements, and the
Proposed Advisory Agreement, have an initial term of two years and provide that
they will thereafter continue in effect from year to year only if such
continuation is specifically approved at least annually by (a) either (i) a vote
of a majority of the Board of Directors of the Fund, or (ii) a vote of a
majority of the outstanding voting securities of the Portfolio, and (b) a vote
of a majority of the Fund's directors who are not "interested persons" (as
defined in the 1940 Act). The Advisory and Sub-Advisory Agreements, and the
Proposed Advisory Agreement, provide that they may be terminated by the Fund, on
behalf of the Portfolio, by the Fund's Board of Directors or by a vote of a
majority of the Portfolio's outstanding voting securities, or by the investment
adviser, in each case at any time upon 60 days_ written notice to the other
party. In addition, each Agreement provides for automatic termination in the
event of its assignment.
Pursuant to the Advisory Agreement, AMT Capital Advisers is responsible
for, or must engage a third party for the purpose of, managing the investment
portfolio of the Portfolio. Under the Sub-Advisory Agreement, subject to the
supervision and approval of AMT Capital Advisers, HLM is responsible for
providing investment research and advice, determining which portfolio securities
shall be purchased or sold by the Portfolio, purchasing and selling securities
on behalf of the Portfolio and determining how voting and other rights with
respect to the portfolio securities of the Portfolio are exercised in accordance
with the Portfolio's investment objective, policies and restrictions. Under the
Proposed Advisory Agreement, HLM would manage the securities held by the
Portfolio, subject to the supervision and stated direction of the Fund_s
Board of Directors, in accordance with the Portfolio_s investment objective and
policies, make investment decisions for the Portfolio, and place orders to
purchase and sell securities on behalf of the Portfolio. As sub-adviser, HLM
currently provides these same services to the Portfolio, subject to the
supervision and stated direction of AMT Capital Advisers, and ultimately the
Fund's Board of Directors. Thus, under the Proposed Advisory Agreement HLM no
longer would be subject to the supervision of AMT Capital Advisers, but would
continue, of course, to be subject to the supervision of the Fund's Board of
Directors. The Proposed Advisory Agreement is not expected, however, to result
in any material changes to the day-to-day investment decisions currently
provided to the Portfolio.
The Advisory and Sub-Advisory Agreements and the Proposed Advisory
Agreement each provide that the investment adviser is not liable to the
Portfolio for any error of judgment but shall be liable to the Portfolio for
any loss resulting from fraud, willful misfeasance, or gross negligence by the
investment adviser in providing services under the Agreement or from reckless
disregard by the investment adviser of its obligations and duties under the
Agreement.
Under the Advisory and Sub-Advisory Agreements, AMT Capital Advisers and
HLM (and AMT Capital, pursuant to the administration agreement between the Fund
and AMT Capital) voluntarily have agreed to cap the Portfolio's total annual
operating expenses at 0.95% to 1.05% (on an annualized basis) of the Portfolio's
average daily net assets, with the exact amount subject to adjustment for any
positive performance fee (discussed below). Under the Proposed Advisory
Agreement, HLM has agreed that it would cap the total annual ordinary operating
expenses at 1.00% (on an annualized basis) of the Portfolio's average daily net
assets.
Advisory Fees. The aggregate base investment advisory fee currently paid
under the Advisory Agreement is the same as the aggregate investment advisory
fee that would be paid under the Proposed Advisory Agreement. Under the
Advisory Agreement, the Portfolio pays AMT Capital Advisers a monthly base fee
at the annual rate of 0.75% of the average daily net assets of the Portfolio.
Under the Sub-Advisory Agreement, AMT Capital Advisers pays to HLM out of the
investment advisory fee a monthly base fee at the annual rate of 0.50% of the
average daily net asset value of the Portfolio. Both the Advisory and
Sub-Advisory Agreements include a performance adjustment increasing or
decreasing the fee paid by the Portfolio to AMT Capital Advisers (and the fee
paid by AMT Capital Advisers to HLM) by a maximum of 10 basis points or within
a range of 0.65% to 0.85% for the advisory fee and 0.40% to 0.60% for the
sub-advisory fee (a "basis point" is one-hundredth of a percentage point or
0.01%). The performance adjustments are added to or deducted from the base
annual fee of 0.75% of the Portfolio's average daily net assets that the
Portfolio pays to AMT Capital Advisers, and the base annual fee of 0.50% of the
Portfolio's average daily net assets that AMT Capital Advisers pays to HLM,
based on a comparison of the Portfolio's actual gross total returns vis-a-vis
the actual gross total return of the Portfolio's benchmark, the Morgan Stanley
Capital International World ex USA Index (with income reinvested) as follows:
i) a benchmark return plus 450 basis points or more will result in an increase
of the base by 10 basis points; ii) a benchmark return plus 300 to 449.99 basis
points will result in an increase of the base by 5 basis points; iii) a
benchmark return plus 150 to 299.99 basis points will result in no adjustment
to the base; iv) a benchmark return plus 0 to 149.99 basis points will result in
a reduction of the base by 5 basis points and v) a return of less than the
benchmark will result in a reduction of the base by 10 basis points. Under the
Proposed Advisory Agreement, the Portfolio would pay HLM a monthly fee at an
annual rate of 0.75% of the average daily net assets of the Portfolio. The
Proposed Advisory Agreement would not include any performance adjustment.
The following table and example provide a comparison of the annual
Portfolio operating expenses (as a percentage of average net assets) currently
paid under the Advisory and Sub-Advisory Agreements and the amounts the
Portfolio would pay under the Proposed Advisory Agreement:
Total
Advisory 12b-1 Administration Other Operating
Fees Fee Fees Expenses Expenses
Current Advisory 0.74%(a) None 0.10% 0.11%(b) 0.95%(b)
and Sub-Advisory
Agreements
Proposed Advisory 0.75% None 0.15% 0.10%(c) 1.00%(c)
Agreement
- --------------------------
(a) This denotes the average annualized investment advisory fee that will be
paid to AMT Capital Advisers. For the first two months after commencement
of the Portfolio, AMT Capital Advisers was paid at a rate of 0.70% (on an
annualized basis) of the Portfolio's average daily net assets; and for
the next twelve months (including the current period) AMT Capital Advisers
will be paid at a rate of 0.75% (on an annualized basis) of the Portfolio's
average daily net assets. Subsequently, AMT Capital Advisers' base fee
will be adjusted in month fourteen for the Performance Adjustment Fee
as described above and will vary from that point forward.
(b) AMT Capital Advisers and HLM (and AMT Capital, pursuant to the
administration agreement between the Fund and AMT Capital) voluntarily have
agreed to cap the total annual operating expenses at 0.95% to 1.05% (on an
annualized basis) of the Portfolio's average daily net assets, with the
exact amount subject to adjustment for any positive performance fee.
Without such cap, the total annual operating expenses (on an annualized
basis) for the Portfolio for the period ending December 31, 1994 would have
been 1.25% (of which 0.41% would be "other expenses") of its average daily
net assets. While the cap will be increased above 0.95% by the amount of
any positive performance adjustment to the investment advisory fee, the cap
will not be decreased in the event of any negative performance adjustment.
(c) Under the Proposed Advisory Agreement, HLM, as investment adviser, has
voluntarily agreed to cap annual operating expenses at 1.00% (on an
annualized basis) of the Portfolio's average daily net assets. Without
such cap, the total annual operating expenses (on an annualized basis) for
the Portfolio for the period ending December 31, 1995 are estimated to be
[ %] (of which [ %] would be "other expenses") of its average daily net
assets.
Expenses Per $1,000 Investment
1 Year 3 Years 5 Years 10 Years
Current Advisory and Sub-Advisory
Agreements $10 $31
Proposed Advisory Agreement $ $
These examples should not be considered a representation of future expenses
or performance. Actual operating expenses and annual returns may be greater or
less than those shown.
During the Portfolio's fiscal year ended December 31, 1994, AMT Capital
Advisers, HLM and AMT Capital waived their entire fees and reimbursed the
Portfolio for other expenses exceeding the Portfolio's voluntary expense cap.
Alan M. Trager, a Director and the President of the Fund, is also President and
Director of AMT Capital Advisers and its affiliate AMT Capital. Had the
Proposed Advisory Agreement been in effect for the Portfolio's fiscal year ended
December 31, 1994, HLM also would have been required to waive its entire fee
under the voluntary expense cap that will be implemented if the Proposed
Advisory Agreement is approved.
Under a sales incentive fee agreement dated April 29, 1994 between AMT
Capital and HLM, AMT Capital has agreed to pay HLM a monthly sales incentive fee
at an annual rate of 0.05% of the average daily value of shares of the Portfolio
purchased as a result of the efforts of HLM. If Shareholders approve the
Proposed Advisory Agreement, HLM and AMT Capital would enter into a sales
incentive fee agreement pursuant to which HLM would pay AMT Capital a monthly
sales incentive fee at an annual rate of 0.25% of the average daily value of
shares of the Portfolio purchased as a result of the efforts of AMT Capital.
Consequences of Approval and of Disapproval. If the Proposed Advisory
Agreement is approved by Shareholders, it will become effective as soon as
practicable thereafter, and will remain in effect, unless earlier terminated,
for an initial two-year term, subject to annual review and continuation
thereafter. AMT Capital will continue to serve as administrator and distributor
regardless of whether Shareholders approve the Proposal. If the Proposed
Advisory Agreement is not approved by Shareholders, the Advisory and Sub-
Advisory Agreements will remain in effect until the end of their terms, unless
earlier terminated, subject to annual review and continuation thereafter.
EVALUATION OF THE PROPOSAL AND RECOMMENDATION BY THE DIRECTORS
At a meeting of the Board of Directors of the Fund held on February 22,
1995, the Directors approved the Proposed Advisory Agreement and voted to
recommend that it be submitted for Shareholder approval. In making this
determination, the Directors considered a number of factors including, among
others:
(1) HLM's commitment to attempt to expand the assets of the
Portfolio if the Proposed Advisory Agreement is approved, which could
produce economies of scale in the management and administration of the
Portfolio;
(2) the fact that the Portfolio would be able to continue to receive
the high quality services currently provided by HLM, without interruption;
(3) the fact that aggregate investment advisory fees that would be
paid to HLM under the Proposed Advisory Agreement are equivalent to the
aggregate base investment advisory fees currently paid pursuant to the
Advisory and Sub-Advisory Agreements, that the Portfolio's investment
advisory fee under the Proposed Advisory Agreement would not increase in
the event of the Portfolio's superior performance, and that the Advisory
and Sub-Advisory Agreements and the Proposed Advisory Agreement are
substantially similar in all other material respects;
(4) the quality of services that HLM as investment adviser would
provide to the Portfolio and the fact that the services HLM would perform
under the Proposed Advisory Agreement are substantially similar to those
currently provided under the Advisory and Sub-Advisory Agreements;
and
(5) the education and experience of the personnel at HLM who would be
providing services to the Portfolio.
The Directors also considered HLM's use of, and receipt of benefits from,
soft dollar arrangements in connection with purchasing and selling portfolio
securities on behalf of the Portfolio. As a matter of policy, HLM does not
participate in any "third-party" soft dollar arrangements, as defined in SEC
Release No. 34-35375 (Proposed Amendments on Investment Adviser Soft Dollar
Disclosure), to obtain products or services. HLM does utilize "full service"
broker-dealers for execution of transactions. These broker-dealers also provide
research and analysis services that are used by HLM in servicing client
accounts. The commission rate paid to such broker-dealers may be higher than
the lowest commission rate available.
HLM is of the opinion that these arrangements provide a benefit to the
Portfolio, since broker-dealers utilized by HLM will tend to follow a broader
universe of securities and other matters than HLM's staff may be able to
follow. In addition, outside research provided by soft dollar arrangements
provides HLM with a diverse perspective on the financial markets around the
world, and, in some cases, the research provided may only be available from
the broker-dealer providing such services. HLM believes such outside research
services obtained through soft dollar arrangements supplement rather than
replace the research of HLM. To the extent that HLM would have purchased these
research services had they not been provided by broker-dealers, the expenses
of HLM could be considered to have been reduced accordingly. Certain research
services furnished by broker-dealers may be useful to HLM with respect to
clients other than the Portfolio and research services furnished by
broker-dealers in connection with HLM's other clients may be useful with
respect to HLM's management of the Portfolio. The Directors considered these
factors and determined that these research services improve the quality of the
investment advice HLM provides to the Portfolio and therefore that they are
of benefit to the Portfolio and its Shareholders. The fees that are paid to HLM
under the Sub-Advisory Agreement, and the fees that would be paid to HLM under
the Proposed Advisory Agreement, are not reduced because HLM receives such
services.
Based upon its review, the Board of Directors determined that the Proposed
Advisory Agreement is reasonable, fair, and in the best interests of the
Portfolio and its Shareholders, and that the fees provided in the Proposed
Advisory Agreement are fair and reasonable. Accordingly, after consideration of
the above factors, and such other factors and information as it deemed relevant,
the Board of Directors, including all of the Directors who are not interested
persons of the Fund, AMT Capital Advisers or HLM, unanimously approved the
Proposed Advisory Agreement and voted to recommend that it be submitted for
approval of the Portfolio_s Shareholders.
THE DIRECTORS, INCLUDING THE INDEPENDENT DIRECTORS,
RECOMMEND THAT SHAREHOLDERS VOTE "FOR" PROPOSAL ONE
AND ANY UNMARKED PROXIES WILL BE SO VOTED.
CERTAIN INFORMATION REGARDING A CHANGE IN THE NAME OF THE PORTFOLIO
The Board of Directors has voted to change the name of the Portfolio from
"International Equity Portfolio" to "HLM International Equity Portfolio" if the
Proposed Advisory Agreement is approved by Shareholders. Such a revision is not
required to be approved by Shareholders under Maryland Law and therefore
Shareholders are not being asked to vote on this issue. If the Proposed
Advisory Agreement is not approved, then no such name change in the Portfolio
will occur.
OTHER BUSINESS
The Directors know of no other business to be brought before the Meeting.
However, if any other matters properly come before the Meeting, proxies will be
voted in accordance with the judgment of the Board of Directors.
Proposals for Future Meetings
As a Maryland Corporation, the Fund is not required to hold annual
Shareholder meetings in any year in which no meeting is required under the
1940 Act. Consequently, the Fund does not intend to hold annual
Shareholder meetings each year, but meetings may be called by the Directors from
time to time. Proposals of Shareholders that are intended to be presented at a
future Shareholder meeting must be received by the Fund by a reasonable time
prior to the Fund_s mailing of information statements relating to such meeting.
By Order of the Board of Directors
William E. Vastardis
Secretary
