UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934
Filed by the Registrant [X]x Filed by a Party other than the Registrant [ ]
¨
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only
(as permitted by Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Rule 14a-12
GREEN CENTURY FUNDS
(Name
¨ | Preliminary Proxy Statement. | |
¨ | Confidential, for use of the Commission Only (as permitted by Rule 14a-6(e)(2)). | |
x | Definitive Proxy Statement. | |
¨ | Definitive Additional Materials. | |
¨ | Soliciting Material Pursuant to 14a-12. | |
Green Century Funds
(Name of Registrant as Specified In Its Charter)
(Name
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ]
| 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 filing fee is calculated and state how it was determined): | |||
| (4) | Proposed maximum aggregate value of transaction: | |||
| (5) | Total fee paid: | |||
¨ | Fee paid previously with preliminary materials: | |||
¨ | Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the form or schedule and the date of its filing. | |||
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| (4) | Date Filed: | |||
From: Green Century Funds [GreenCenturyFunds@2voteproxy.com]
Sent:
To:
Subject: Green Century Funds Board - Please Vote
Dear Shareholder,
We are writing today to request your vote for a proxy proposal for the Green Century Funds. Details on tablethe proposal can be accessed using the link for the electronic voting site below. You are receiving this e-mail because you were a shareholder of the Green Century Balanced Fund and/or of the Green Century Equity Fund on the record date for the vote, July 22, 2014, and are entitled to vote.
The Funds’ Board of Trustees recommends that the following people serve as the Funds’ Trustees: John Comerford, Jonathan Darnell, Laurie Moskowitz, Douglas H. Phelps, Bancroft R. Poor, Mary Raftery, James H. Starr, and Wendy Wendlandt. The proposal described in the materials referenced below per Exchange Act Rules 14a-6(i)(1)seeks your vote in favor of all of the nominees.
Each of the Funds’ Trustees serve without pay as volunteers and 0-11.
1) Titleeach is committed to furthering sustainable investing and advocacy for greater corporate environmental responsibility.
The Green Century Funds Board of Trustees has carefully reviewed the proposal and recommends that you vote “for” the election of each class of securities to which transaction applies:
2) Aggregate number of securities to which transaction applies:
3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):
4) Proposed maximum aggregate value of transaction:
5) Total fee paid:
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identifynominees. Green Century Capital Management, Inc. (Green Century) also recommends that you vote “for” the filing for whichelection of each of the offsetting fee was
paid previously. Identifynominees.
For access to the previous filing by registration statement
number, or the Form or Scheduleproxy materials and the datesecured electronic voting site, please visit:https://www.2voteproxy.com/gcf. Your personal control number is 309 700 800 317 34.
We ask that you consider voting now so that we will avoid the environmental and financial costs of its filing.
1) Amount Previously Paid:
2) Form, Scheduleadditional solicitations. Your vote is important, no matter how many shares you own.
If you need any additional information about this vote, or Registration Statement No.:
3) Filing Party:
4) Date Filed:
[LOGO] GREEN CENTURY FUNDS
if you would like to receive a paper copy of the proxy statement, please feel welcome to call us at 1-800-93-GREEN (1-800-934-7336), Monday through Friday, 9 a.m. to 6 p.m. Eastern Time. We will be happy to explain the proxy or to answer any questions you may have. The proxy statement is also available on our website athttp://www.greencentury.com/pdf/proxy.pdf.
Thank you for investing with the first and only family of fossil fuel free diversified and responsible mutual funds in the nation.
Sincerely,
/s/Kristina A. Curtis/s/ | /s/Leslie Samuelrich/s/ | |
Kristina A. Curtis | Leslie Samuelrich | |
President | President | |
Green Century Funds | Green Century Capital Management, Inc. | |
Green Century Funds
114 State Street
Boston, MA 02109
September 15, 2006
1-800-93-GREEN
August 12, 2014
Dear Shareholder:
We are writing today to request your vote for the two proposalsproposal described in the accompanying proxy statement concerning the Green Century Balanced Fund and the Green Century Equity Fund (the
Fund).Fund. You are receiving this proxy statement because you were a shareholder of the Green Century Balanced Fund and/or of the Green Century Equity Fund on September 8, 2006July 22, 2014, and are entitled to vote.
The Funds’ Board of Trustees recommends that the following persons serve as the Funds’ Trustees: John Comerford, Jonathan Darnell, Laurie Moskowitz, Douglas H. Phelps, Bancroft R. Poor, Mary Raftery, James H. Starr, and Wendy Wendlandt. The proposal described in the enclosed materials seeks your vote in favor of the Funds’ Trustees. Each of the Funds’ Trustees serve without pay as volunteers and each is committed to furthering environmentally responsible investing.
The Green Century Funds Board of Trustees has carefully reviewed the proposal and recommends that you vote “for” the election of each of the nominees. Green Century Capital Management, Inc. (Green Century) has been the Fund's
Administrator since the Fund's inception. The Fund's Board of Trustees is now
recommending that Green Century also become the Fund's investment adviser and
that an investment subadviser, Mellon Equity Associates, LLP, be appointed to
perform the Fund's day-to-day portfolio management. The proposals described in
the enclosed materials seek your approval of an Investment Advisory Agreement
and an Investment Subadvisory Agreement in order to effect these changes.
The investment objectives of the Green Century Equity Fund will not change
as a result of these proposals. The Fund currently seeks long-term total return
which matches the performance of the Domini 400 Social/SM/ Index (the Index) by
investing substantially all of its assets in the Domini Social Equity Trust
which in turn invests in the 400 companies included in the Index. The Domini
Social Equity Trust has now received approval from its shareholders to adopt a
different, active investment strategy and raise its fees. In light of those
pending changes, the Board of Trustees of the Fund is recommending that the
Fund continue its existing strategy of investing in a portfolio that seeks to
track the Index - the strategy that you, the Fund's shareholders, selected when
you decided to invest in the Fund. Shareholder approval of the proposed
Investment Advisory and Investment Subadvisory Agreements will allow the Fund
to continue this strategy. Although the management fee paid by the Fund will
increase if the Investment Advisory and Investment Subadvisory Agreements are
approved, Green Century has agreed to lower its administrative fees so that the
overall expenses of the Fund are reduced. The Board of Trustees has carefully
reviewed the proposals and recommends that you vote "for"“for” the election of each of the proposals.
nominees.
Enclosed is a proxy statement describing these proposalsthe proposal in more detail. Please take a few moments to read the enclosed materials. You may then cast your vote by mail, by phone, or online; instructions are on the enclosed proxy card(s). In addition, you may vote at a Special Meeting of Shareholders of the FundFunds to be held on November 6, 2006September 22, 2014 at 3:00 p.m. Eastern Time at Green Century'sCentury’s offices at 114 State Street,Street. Boston, MA 02109. You are not required to attend the Special Meeting in order to cast your vote.
Please vote today. Please note that you may receive more than one proxy card if you own more than one Green Century Funds account. Please vote every proxy card that you receive. If we do not receive your vote, we may need to contact you again.again to ask you to consider the Board’s recommendation and vote. If you have any questions or need assistance, please call us at 1-800-93-GREEN.
1-800-93-GREEN – we will be happy to answer your questions.
Sincerely yours,
/s/ Kristina A. Curtis /s/ Wendy Wendlandt
Kristina A. Curtis Wendy Wendlandt
President President
Green Century Funds Green Century Capital Management,
Inc.
/S/Kristina A. Curtis | /S/Leslie Samuelrich | |||
| Kristina A. Curtis | Leslie Samuelrich | |||
| President | President | |||
| Green Century Funds | Green Century Capital Management, Inc. |
| Page | ||||||
| i | ||||||
| iii | ||||||
| 1 | ||||||
Part 1. | 2 | |||||
Part 2. | Information Regarding Voting and the Special | 2 | ||||
Part 3. | The | 4 | ||||
Part 4. | Information Regarding the | 14 | ||||
Exhibits | ||||||
| A-1 | ||||||
A Special Meeting of Shareholders of the Green Century Balanced Fund (the Balanced Fund) and the Green Century Equity Fund (the "Equity Fund")Equity Fund) (the Funds) will be held at the offices of Green Century Capital Management, Inc. ("Green Century")(Green Century), 114 State Street, Boston, MA 02109, on November 6, 2006September 22, 2014 at 3:00 p.m., Eastern Time, for the purposes described in this proxy statement.
We encourage you to read this proxy statement carefully before casting your vote. We have prepared the following questions and answers in order to help you make your decision easier.decision. If you have any further questions, please feel free to call us at 1-800-93-GREEN (1-800-934-7336).
Q. Why are shareholders of the Equity Fund being asked from 9:00 am to approve the
investment advisory agreement with Green Century and the investment
subadvisory agreement with Mellon Equity Associates, LLP?
A. The Fund currently seeks long-term total return which matches the
performance of the Domini 400 Social/SM/ Index (the "Index") by investing
substantially all of its assets in another mutual fund, the Domini Social
Equity Trust (the "Master Fund"). The Equity Fund has been informed that the
Master Fund will implement an active investment strategy and will no longer
invest in the securities of the companies included in the Index. Green
Century and the Board of Trustees of the Equity Fund believe that it is in
the best interests of the Equity Fund and its shareholders to continue to
invest in the securities of the companies included in the Index.
Accordingly, if the Proposals are approved, effective November 28, 2006, the
Equity Fund will withdraw its investment from the Master Fund and directly
invest in the securities of the companies included in the Index.
In connection with the change from investing in the Master Fund to direct
investment in the stocks which make up the Index, Green Century recommended,
and the Board approved, the appointment of Green Century as the investment
adviser of the Equity Fund and Mellon Equity Associates, LLP ("Mellon
Equity") as the investment subadviser of the Equity Fund.
The Board has determined that Green Century and Mellon Equity have the
experience, qualifications and commitment to environmentally responsible
investing to manage the Equity Fund.
Q. If the Proposals are approved, will this increase the expenses that Equity
Fund shareholders must pay?
A. No, in fact the total expenses of the Equity Fund will decrease (although
the Fund's management fee will increase). As you know, Green Century, as the
administrator of the Equity Fund, pays the operating expenses of the Equity
Fund (excluding certain expenses). As of August 3, 2006, Green Century
contractually agreed to reduce the total fees it receives from the Fund such
that the Equity Fund's total annual expenses are reduced from 1.50% to 0.95%
of the Fund's average net assets. This cap on total expenses payable by the
Equity Fund will continue if the investment advisory agreement with Green
Century and the investment subadvisory agreement with Mellon Equity are
approved. If the investment advisory and subadvisory agreements are not
approved by the shareholders, Green Century may propose to the Equity Fund's
Board of Trustees an increase to the Equity Fund's administrative fee such
that the Equity Fund's total annual expenses may revert to the 1.50% level.
Q. How will Green Century's responsibilities change if the investment advisory
agreement is approved?
A. If the investment advisory agreement is approved by shareholders, Green
Century will act as the investment adviser to the Equity Fund. In its role
as investment adviser, Green Century will, among other things, supervise the
submanagement of the Equity Fund by Mellon Equity and vote proxies for the
Equity Fund. Green Century will continue to serve as the Equity Fund's
administrator.
v
Q. What role will Mellon Equity play in managing the Equity Fund?
A. If the investment subadvisory agreement is approved by shareholders, Mellon
Equity's primary responsibility as the Equity Fund's subadviser will be to
implement the daily transactions necessary so that the composition of the
Equity Fund matches the Index as closely as possible. Mellon Equity will not
be responsible for determining the composition of the Index. In addition,
Mellon Equity will provide Green Century with various reports Green Century
requires to supervise the management of the Equity Fund.
Q. If the proposals are approved, will there be any change in the investment
objective of the Equity Fund?
A. No. The purpose of the proposals is to enable the Equity Fund to continue to
pursue its current investment objective of achieving long-term total return
which matches the performance of an index comprised of the stocks of 400
companies selected based on social and environmental criteria. If the
investment advisory agreement and investment subadvisory agreement are
approved by shareholders, the Equity Fund's investment strategy will change
from investing all of its assets in the Master Fund to directly investing in
the securities of the companies included in the Index. The Equity Fund's
commitment to principles of environmentally responsible investing will not
change.
Q. How does the Board of Trustees recommend that I vote?
A. The Board of Trustees has carefully reviewed each of the proposals and
recommends that you vote FOR each proposal on the enclosed proxy card(s).
Following each proposal is a brief discussion of the factors the Trustees
considered before approving each proposal.
Q. How do I vote?
A. You can vote by mail, by telephone or via the internet. Please see the
instructions set forth on the top portion of the enclosed proxy card(s). You
may also vote in person by attending the Special Meeting of Shareholders.
The meeting will be held at the offices of Green Century, 114 State Street,
Boston, MA 02109, on November 6, 2006 at 3:6:00 p.m.pm Eastern Time. You do not
need to attend in person in order to cast your vote.
vi
| Q. | Who are the Proposed Nominees for Election as Trustees of the Funds? |
| A. | The proposed Nominees for election are John Comerford, Jonathan Darnell, Laurie Moskowitz, Douglas H. Phelps, Bancroft R. Poor, Mary Raftery, James H. Starr, and Wendy Wendlandt. Mses. Raftery and Wendlandt and Messrs. Comerford, Starr, Phelps and Poor are current members of the Board. Mr. Poor was appointed by the Board in 2014. Ms. Raftery was appointed by the Board in 2009. Ms. Wendlandt and Messrs. Comerford, Starr and Phelps were elected by the shareholders of the Funds in 2005. Ms. Moskowitz and Mr. Darnell have not previously served on the Board. |
| Unlike the majority of mutual funds, the Green Century Funds do not pay their Trustees any fees; all the Trustees serve as volunteers. Each of the Trustees is committed to furthering sustainable investing and advocacy for greater corporate environmental responsibility. |
| Q. | What is the Role of the Board? |
| A. | The Board has responsibility for the overall management and operations of the Funds, including general supervision of the duties performed by Green Century, as the investment adviser and the administrator of the Funds, and other service providers. The Board also appoints the officers of the Funds. The officers are responsible for supervising and administering the day-to-day operations of the Funds. The Funds’ Board of Trustees is currently made up of seven individuals, four of whom are “independent,” meaning that they have no formal affiliation with Green Century or the Funds except in their role as Trustees. In addition, the |
i
| Independent Trustees are represented by independent legal counsel to further ensure that shareholder interests remain paramount. |
| Q. | How does the Board of Trustees recommend that I vote? |
| A. | The Board of Trustees has carefully reviewed the proposal and recommends that you voteFOReach Trustee in the proposal on the enclosed proxy card(s). Following the proposal is a brief discussion of the factors the Trustees considered before granting their approval. |
| Q. | If the proposal is approved, will there be any change in the investment objectives of the Balanced Fund or the Equity Fund? |
| A. | No. There is no intent to change any of the key investment strategies or the investment objectives of the Balanced Fund or the Equity Fund, including the Funds’ commitment to principles of environmentally responsible investing. |
| Q. | Why did I receive more than one proxy voting card? |
| A. | You may have received more than one proxy voting card if you hold shares in more than one account in the Funds. To vote all your shares and accounts, please vote each of the proxy cards you received. |
| Q. | How do I vote? |
| A. | You can vote by mail, by telephone or via the internet. Please see the instructions set forth on the top portion of the enclosed proxy card(s). You may also vote in person, by attending the Special Meeting of Shareholders. The meeting will be held at the offices of Green Century, 114 State Street, Boston, MA 02109, on September 22, 2014 at 3:00 p.m. Eastern Time. You do not need to attend in person in order to cast your vote. |
ii
GREEN CENTURY EQUITY FUND
114 State Street, Suite 200
Boston, MA 02109
Telephone: 1-800-93-GREEN (1-800-934-7336)
NOTICE OF SPECIAL MEETING
OF SHAREHOLDERS
To be held November 6, 2006
September 22, 2014
A Special Meeting of Shareholders of the Green Century Balanced Fund (the Balanced Fund) and the Green Century Equity Fund (the "Equity Fund")Equity Fund) (the Funds) will be held at the officesoffice of Green Century Capital Management, Inc., 114 State Street, Boston, MA 02109, on November 6, 2006September 22, 2014 at 3:00 p.m., Eastern Time, for the purposes listed below.
Please review the proposals listed below carefully and be sure to vote on each
proposal on which you are asked to vote.
| Proposal 1. | To | |
| Proposal 2. | To transact such other business as may properly come before the Special Meeting of Shareholders and any adjournments or postponements of the Special Meeting. | |
The Board of Trustees of the Equity FundFunds recommends that you vote in favor of theall Proposals.
Only shareholders of record on September 8, 2006July 22, 2014 will be entitled to vote at the Special Meeting of Shareholders and at any adjournments thereof.
Kristina Curtis, President
| Kristina Curtis, President |
| Green Century Funds |
August 12, 2014
IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS FOR THE SHAREHOLDER MEETING TO BE HELD ON September 15, 2006
22, 2014: This Notice, the Proxy Statement and the Funds’ most recent Annual Report to shareholders are available on the internet athttp://greencentury.com/forms-documents/.
YOUR VOTE IS IMPORTANT. If you promptly vote, sign and return the enclosed proxy card(s) you will help avoid the additional expense of a second solicitation. The enclosed addressed envelope requires no postage and is provided for your convenience. You may also vote by calling the toll-free number listed on the proxy card, or visiting the web site address listed on the proxy card.
vii
iii
GREEN CENTURY BALANCED FUND
GREEN CENTURY EQUITY FUND
114 State Street, Suite 200
Boston, MA 02109
Telephone: 1-800-93-GREEN (1-800-934-7336)
This Proxy Statement is being furnished to you in connection with the solicitation of proxies by the Board of Trustees of the Green Century Balanced Fund (the Balanced Fund) and the Green Century Equity Fund (the "Equity Fund")Equity Fund) (the Funds) for use at a Special Meeting of Shareholders of the Equity Fund,Funds, or any adjournment thereof, to be held at the offices of Green Century Capital Management, Inc. (Green Century), 114 State Street, Boston, MA 02109, on November 6, 2006September 22, 2014 at 3:00 p.m., Eastern Time, for the purposes set forth in the accompanying Notice of Special Meeting. You may call Green Century at 1-800-93-GREEN (1-800-934-7336) for information on how to obtain directions to attend the meeting and vote in person.
The Equity Fund'sFunds’ Annual Report for the fiscal year ended July 31, 2005,2013, including audited financial statements, and Semi-Annual Report for the fiscal period ended January 31, 2006,2014, have previously been sent to shareholders and are available without charge by written request to Green Century Capital Management, Inc., 114 State Street, Suite 200, Boston, MA 02109, by calling Green Century Capital Management at 1-800-93-GREEN (1-800-934-7336), by emailing info@greencentury.com or by downloading the reportsreport from our website at www.greencentury.com.
http://greencentury.com/forms-documents/.
This Proxy Statement is divided into the following four parts:
| Part 1. | Overview. | Page | ||
| Part 2. | Information Regarding Voting and the Special Meeting. | Page 2 | ||
| Part 3. | The | Page | ||
| Part 4. | Information Regarding the | Page | ||
This Proxy Statement was first mailed to shareholders on or about September
15, 2006.
August 12, 2014.
The Board of Trustees of the Green CenturyBalanced Fund and the Equity Fund (the "Equity Fund" or
the "Fund") has called a Special Meeting of Shareholders for the purposes described in the accompanying Notice of Special Meeting and as summarized below. The purpose of this Proxy Statement is to provide you with additional information regarding the proposalsproposal to be voted on at the Meeting and to request your vote in favor of the proposals.
proposal.
The Equity Fund is anFunds are open-end management investment company,companies, or mutual fund.funds. The Balanced Fund seeks capital growth and income from a diversified portfolio of stocks and bonds which meet the Green Century Funds’ standards for corporate environmental responsibility. The Equity Fund is an index fund whose investment objective is to achieve long-term total return which matches the performance of an index comprised of stocks of 400 companies selected based on environmental, social and environmentalgovernance criteria.
Summary of Proposals
Eachthe Proposal
Shareholders are being asked to elect John Comerford, Jonathan Darnell, Laurie Moskowitz, Douglas H. Phelps, Bancroft R. Poor, Mary Raftery, James H. Starr, and Wendy Wendlandt as Trustees of the following proposalsFunds (each, a “Nominee” and collectively, the “Nominees”). Mses. Raftery and Wendlandt and Messrs. Comerford, Phelps, Poor and Starr are currently Trustees of the Funds. This Proposal is discussed in more detail inunder Part 3 of this Proxy Statement.
Proposal 1. Approval of an Investment Advisory Agreement for the Equity Fund
between the Equity Fund and Green Century Capital Management, Inc.
Currently, the Equity Fund pursues its investment objective by investing
substantially all of its assets in the Domini Social Equity Trust, which in
turn invests in the 400 companies included in the Domini 400 Social/SM/ Index
(the "Index"). Accordingly, the Fund does not currently have its own investment
adviser. Because the
1
Domini Social Equity Trust will change its investment strategy, the Board of
Trustees of the Fund proposes that effective November 28, 2006, the Fund
directly invest in the securities of the companies included in the Index. In
order to execute this new investment strategy, the Board of Trustees is
proposing that Green Century Capital Management, Inc. ("Green Century"), the
Fund's administrator, be appointed as the Fund's investment adviser. The Board
has determined that Green Century will be able to effectively oversee the
Equity Fund's direct investment in the securities of the companies included in
the Index.
Shareholders of the Fund are asked to approve an Investment Advisory
Agreement between the Fund and Green Century. See Proposal 1 in Part 3 for more
information.
Proposal 2. Approval of an Investment Subadvisory Agreement for the Equity
Fund among the Equity Fund, Green Century Capital Management, Inc. and Mellon
Equity Associates, LLP.
In order to execute the change from investing substantially all of its
assets in the Domini Social Equity Trust to direct investment in the stocks
which make up the Index, Mellon Equity Associates, LLP ("Mellon Equity ") is
proposed as the investment subadviser of the Fund. The Board has determined
that Mellon Equity has the experience in index investing and commitment to
environmentally responsible investing to manage the Equity Fund.
Shareholders are asked to approve an Investment Subadvisory Agreement among
the Equity Fund, Green Century and Mellon Equity. See Proposal 2 in Part 3 for
more information.
PART 2. INFORMATION REGARDING VOTING AND THE SPECIAL MEETING.
Voting Process
You can vote in any one of the following ways:
.
You will be entitled to cast one vote for each dollar of net asset value of the Fund you hold (number of shares owned multiplied by the net asset value per share). The votes of the shareholders of the Balanced Fund and the Equity Fund will be tabulatedtogetherfor the proposal.
If you receivedreceive more than one proxy card, please vote each proxy card separately, either by returning each card via mail or by voting each card on the toll-free number or viaonline. You may receive more than one proxy card if you hold shares in more than one account in the internet.
Funds. To vote all your shares and accounts, please vote each of the proxy cards you receive.
If you return your proxy and fail to provide instructions as to how to vote your shares with respect to anythe proposal, your shares will be voted FOR thatthe proposal.
Record Date
The close of business on September 8, 2006 has beenJuly 22, 2014 was fixed as the Record Date for the determination of shareholders entitled to notice of and to vote at the Meeting. 1,649,774.3975,103,512.439 shares of the Balanced Fund (par value $0.01 per share) and 3,138,277.356 shares of the Equity Fund (par value $0.01 per share) were outstanding as of the close of business on the Record Date.
Quorum
Holders of a majority of the voting power of the shares of theeach Fund entitled
to voteoutstanding on the Record Date constitute a quorum and must be present in person or represented by proxy at the Meeting for purposes of voting on Proposals 1 and
2.the proposal. Your shares will be represented by proxy at the Meeting if you vote by mail, by telephone, or by the internet.
2
Regardless of how you vote ("For"(“For”, "Against"“Against” or "Abstain"“Abstain”), your shares will be counted for purposes of determining the presence of a quorum. In addition, broker "non-votes"“non-votes” (that is shares held by brokers or nominees as to which (a) instructions have not been received from the beneficial owner or other persons entitled to vote and (b) the broker or nominee does not have discretionary power to vote on a particular matter) will be counted for purposes of determining the presence of a quorum.
If you mark "Abstain" on your proxy card with
With respect to any proposal onthe election of Trustees, nominees must be elected by a plurality of the votes cast in person or by proxy at the meeting at which youa quorum exists. Abstentions and broker “non-votes” are entitled tonot considered “votes cast” and therefore, do not constitute a vote your vote“For” the proposal. Thus, abstentions and broker “non-votes” will have no effect on the effectvoting for the election of Trustees in the proposal because only “for” votes are considered in a "no" vote
for purposes of obtaining the requisite approval of Proposals 1 and 2. Broker
"non-votes" will also have the effect of a "no" vote for purposes of obtaining
the requisite approval of the Proposals.
plurality voting requirement.
Revoking Your Proxy
You may revoke your proxy at any time prior to the Meeting (or any adjournment or postponement thereof) by putting your revocation in writing, signing it and either delivering it to the Meeting or sending it to Amy F. Puffer, Secretary of the Green Century Funds, 114 State Street, Suite 200, Boston, MA 02109. You may also revoke your proxy by voting in person at the Meeting.
Adjournments and Postponements
If sufficient votes in favor of anythe proposal are not received, the persons named as proxies may propose one or more adjournments or postponements of the Meeting to permit further solicitation of proxies with respect to thatthe proposal. An adjournment or postponement of the Meeting will suspend the Meeting to another time. Any such adjournment will require the affirmative vote of a majority of those shares voted at the Meeting. If you voted in favor of athe proposal or failed to provide instructions as to how to vote your shares with respect to athe proposal (including broker non-votes), the persons named as proxies will vote your shares in favor of suchthe adjournment of the Meeting with respect to thatthe proposal. If you voted against or abstained from voting on athe proposal, the persons named as proxies will vote your shares against any such adjournment. Any proposal for which sufficient favorable votes have been
received by the time of the Meeting may be acted upon and considered final
regardless of whether the Meeting is postponed or adjourned to permit the
additional solicitation of proxies with respect to the other proposal.
Proxy Solicitation Costs
The cost of soliciting proxies (which is expected to be approximately $40,000)$25,000), including the fees of a proxy soliciting agent (which isare expected to be approximately $5,500)$20,000), will be borne by Green Century Capital Management, not the Equity Fund.Funds. In addition to solicitation by mail and the proxy soliciting agent, proxies may be solicited by the Board of Trustees, officers, and regular employees and agents of the Equity FundFunds and Green Century without compensation. Green Century may reimburse brokerage firms and others for their expenses in forwarding proxy materials to the beneficial owners and soliciting them to execute the proxies.By voting as soon as you receive your proxy materials, you will help reduce the cost of additional mailings and other solicitations, which may include telephone calls to shareholders for the purpose of reminding shareholders to vote.
PART 3. THE PROPOSALS.
Introduction
ShareholdersPROPOSAL.
Proposal 1. To elect Trustees of the Green Century Equity Fund (the "Equity Fund" or the
"Fund")Funds.
You are being asked to approve an Investment Advisory Agreement between the
Equity Fund and Green Century Capital Management,
3
Inc. ("Green Century") (the "Advisory Agreement") and an Investment Subadvisory
Agreement among the Equity Fund, Green Century and Mellon Equity Associates,
LLP ("Mellon Equity") (the "Subadvisory Agreement", and together with the
Advisory Agreement, the "Advisory Agreements") for the Fund.
The investment objective of the Equity Fund is to achieve long-term total
return which matches the performance of an index comprised of the stocks of 400
companies selected based on social and environmental criteria. Currently, the
Fund iselect a "feeder" fund within a structure known as a "master/feeder" mutual
fund structure. Rather than invest directly in securities, the Fund now seeks
to achieve its investment objective by investing substantially all of its
assets in a separate fund, or "master" fund called the Domini Social Equity
Trust (the "Master Fund"), which invests in the stocks which make up the Domini
400 Social/ SM/ Index/1/ (the "Index"). The Index is comprised of the common
stocks of 400 companies and is screened based on social and environmental
criteria.
The Equity Fund has been informed that the Master Fund will implement an
active investment strategy and will no longer invest in the securities of the
companies included in the Index.
The Board of Trustees of the Fund believes that it is in the best interests
of the Equity Fund and its shareholders to continue to invest in the securities
of the companies included in the Index. Accordingly, at meetings held on
August 3, 2006 and August 24, 2006, the Board approved the withdrawal of the
Fund's investment from the Master Fund, subject to shareholder approval of the
Advisory Agreements. If shareholders of the Equity Fund approve the Advisory
Agreements then, effective November 28, 2006, the Equity Fund, in accordance
with its investment objective, will invest directly in the stocks which make up
the Index.Funds. The Index was the first index constructed using environmental, social and
governance criteria. It was created and launched in May 1990 by the independent
investment research firm of KLD Research & Analytics, Inc. ("KLD") in order to
serve as a benchmarknominees for socially responsible investors and to determine how
social and environmental screening affects the risk and return characteristics
of investment portfolios. The Index is comprised of the common stocks of 400
companies selected on the basis of environmental, social and governance factors.
In connection with the change from a master/feeder structure to direct
investment in the stocks which make up the Index, the Board approved the
appointment of Green Century as the investment adviser of the Fund, subject to
shareholder approval of the Advisory Agreements. In its role as investment
adviser, Green Century will, among other things, supervise the submanagement of
the Fund and vote proxies for the Fund. In connection with its appointment as
the Fund's investment adviser, Green Century will enter into an agreement with
KLD to license the Index. These arrangements will allow the Equity Fund to
continue to invest in the stocks that make up the Index, which is the strategy
the Fund's shareholders selected when they invested in the Fund.
Green Century has also recommended, and the Board has approved, the
appointment of Mellon Equity as the investment subadviser of the Fund, subject
to shareholder approval of the Advisory Agreements. If shareholders approve the
Advisory Agreements, Mellon Equity's primary responsibility as subadviser of
the Equity Fund will be to implement the daily transactions necessary so that
the composition of the Fund matches the Index as closely as possible. Mellon
Equity will not be responsible for determining the composition of the Index. In
addition, Mellon Equity will provide Green Century with various reports Green
Century requires to supervise the management of the Fund.
The Board of Trustees has determined that Green Century and Mellon Equity
have the experience, qualifications and commitment to environmentally
responsible investing to manage the Equity Fund.
- --------
/1/ Domini 400 Social/SM/ Index is a service mark of KLD Research & Analytics,
Inc. and is used under license.
4
Proposal 1.To Approve an Investment Advisory Agreement between the Equity Fund
and Green Century Capital Management, Inc.
You are being asked to approve an Investment Advisory Agreement for the
Equity Fund pursuant to which Green Century will act as the Fund's investment
adviser. The Equity Fund does not currently have an investment adviser since
the Fund seeks to achieve its investment objective by investing all its assets
in the Master Fund. The Master Fund has retained the services of Domini Social
Investments LLC ("DSIL") as investment adviser of the Master Fund. In
connection with the change from a master/feeder structure to direct investment
in the companies included in the Index, the Board approved the appointment of
Green Century as the investment adviser of the Fund and the Advisory Agreement,
subject to shareholder approval.
Terms of the Investment Advisory Agreement
Please refer to Exhibit A attached to this proxy statement for the complete
Advisory Agreement between the Equity Fund and Green Century. The description
of the Advisory Agreement in this proxy statement is qualified in its entirety
by the provisions of the Advisory Agreement attached as Exhibit A.
The Advisory Agreement provides that Green Century will manage the
investment and the reinvestment of the Fund's assets. Green Century will have
authority to determine from time to time what securities are purchased, sold or
exchanged, and what portion of assets of the Fund is held uninvested. The
services provided by Green Century shall include determining the manner in
which voting rights, right to consent to corporate action and any other rights
pertaining to the portfolio securities shall be exercised.
The Advisory Agreement provides that Green Century may render services to
others. Green Century may employ, at its own expense, or may request that the
Fund, employ (subject to the requirements of the Investment Company Act of 1940
(the "1940 Act")) one or more subadvisers, subject to Green Century's
supervision. The Advisory Agreement is terminable without penalty upon 60 days'
written notice by the Fund, when authorized either by majority vote of the
outstanding voting securities of the Fund, or by a vote of a majority of the Board of Trustees are John Comerford, Jonathan Darnell, Laurie Moskowitz, Douglas H. Phelps, Bancroft R. Poor, Mary Raftery, James H. Starr, and Wendy Wendlandt (each, a “Nominee” and collectively, the “Nominees”). Mses. Raftery and Wendlandt and Messrs. Comerford, Phelps, Poor and Starr are currently Trustees of the Fund, or by Green Century, and will automatically
terminate in the event of its assignment. Funds.
The Advisory Agreement provides that
neither it nor its personnel will be liable for any error of judgment or
mistake of law or for any loss arising out of any investment or for any act or
omission in its services to the Fund, except for willful misfeasance, bad
faith, or gross negligence or reckless disregard of its or their obligations
and duties under the Advisory Agreement.
If the Advisory Agreement is approved by the vote of the holders of a
"majority of the outstanding voting securities" (as defined under the heading
"Vote Required" below) of the Fund, the Advisory Agreement will become
effective on November 28, 2006 and continue in effect until November 28, 2008,
and thereafter will continue in effect if such continuance is specifically
approved at least annually by the Board of Trustees or by a majority of the
outstanding voting securities of the Fund at a meeting calledFunds do not hold annual shareholder meetings for the purpose of votingelecting Trustees, and Trustees are not elected for fixed terms. This means that each Trustee will be elected to hold office until his or her successor is elected or until he or she retires, resigns, dies or is removed from office. Mr. Comerford was appointed by the Board in 2005 and was elected by shareholders in 2006. Mr. Phelps was appointed by the Board in 1997 and was elected by shareholders in 2006. Ms. Wendlandt and Mr. Starr were elected by the initial shareholder of the Funds in 1991 and by all shareholders in 2006. Ms. Raftery was appointed by the Board in 2009 and has not been elected by shareholders. Mr. Poor was appointed by the Board in 2014 and has not been elected by shareholders. Each of the Nominees has consented to being named in this Proxy Statement and to serving on the Advisory Agreement, and, in either case, by aBoard if elected.
Unlike the majority of mutual funds, the Green Century Funds do not pay their Trustees any fees; all the Trustees serve as volunteers. Each of the Trustees who are not partiesis committed to the Advisory Agreement or interested persons of
any such party at a meeting called for the purpose of voting on the Advisory
Agreement.
Investment Advisory and Administrative Fees
The Fund, as an investor in the Master Fund, currently pays a portion of the
investment advisory fee charged to the Master Fund by DSIL. DSIL is entitled to
receive monthly a fee from the Master Fund in the amount of 0.20% of the first
$2 billion of net assets managed, 0.19% of the next $500 million of net assets
managed and 0.18% of net assets managed in excess of $2.5 billion for providing
investment advisory services to the Master Fund.
5
If the shareholders of the Fund approve the Advisory Agreement, the Fund
will redeem its investment in the Master Fund and Green Century will manage the
Fund's investments directly. The Fund will no longer pay a portion of the
investment advisory fee charged to the Master Fund by DSIL but rather will pay
Green Century an investment advisory fee under the Advisory Agreement. Under
the Advisory Agreement, Green Century will be entitled to receive a fee from
the Equity Fund equal on an annual basis to 0.25% of the average daily net
assets of the Equity Fund up to but not including $100 million, 0.22% of the
average daily net assets of the Equity Fund from and including $100 million up
to but not including $500 million, 0.17% of the average daily net assets of the
Equity Fund from and including $500 million up to but not including $1 billion,
and 0.12% of the average daily net assets of the Equity Fund equal to or in
excess of $1 billion for providing investment advisory services to the Fund.
The following table demonstrates (1) the actual portion of the investment
advisory fees paid by the Fund as an investor in the Master Fund for the fiscal
year ended July 31, 2006; (2) the amount the Fund would have paid to Green
Century if the Advisory Agreement had been in effect for that year; and (3) the
difference between these amounts stated as a percentage:
(1)
Actual Investment Advisory
Fees paid by the Fund as an (2)
Investor in the Master Fund Estimated Amount the Fund would
for the fiscal year ended have Paid to Green Century if the (3)
July 31, 2006 Advisory Agreement had been in Effect Percentage Increase
- --------------------------- ------------------------------------- -------------------
$68,618 $85,773 25%
Pursuant to an Administrative Services Agreement between the Fund and Green
Century, Green Century, as the Fund's administrator, provides the Fund with
general office facilities, supervises the overall administration of the Fund,
and pays all the operating expenses of the Fund other than the Fund's
investment advisory fees, if any, interest, taxes, brokerage costs and other
capital expenses, expenses of the non-interested Trustees of the Fund
(including counsel fees) and any extraordinary expenses.
For this and other services, the Fund pays Green Century an administrative
fee at a rate such that the Fund's total annual expenses are limited to a
certain percentage of the Equity Fund's average net assets. For the fiscal year
ended July 31, 2006, the Equity Fund accrued $442,588 in administrative fees.
As of August 3, 2006, Green Century has contractually agreed to reduce its
administrative fee such that the Fund's total annual expenses are decreased
from 1.50% to 0.95% of the Equity Fund's average net assets. This reduction in
the administrative fee will continue even if the Advisory Agreements are not
approved by shareholders. However, if the Advisory Agreements are not approved,
Green Century may propose to the Equity Fund's Board of Trustees an amendment
to the Administrative Services Agreement to increase the Fund's total annual
expenses to its previous level of 1.50% of the Fund's average net assets.
To assist you in understanding the effect of the proposed increase in the
advisory fee and the attendent decrease in the administrative fee on the
expense offurthering sustainable investing in shares of the Equity Fund, the following table
summarizes the expenses incurred by the Fund for the fiscal year ended July 31,
2006 and also restates these expenses to show what the expenses would have been
had the proposed advisory fee and the lower administrative fee been in effect
during the same period.
6
Prior(1) Current(1) Proposed
-------- ---------- --------
Shareholder Fees
(fees paid directly from your investment)
Sales Charge (Load) Imposed on Purchases....................... None None None
Deferred Sales Charge (Load)................................... None None None
Maximum Sales Charge (Load) Imposed on Reinvested Dividends and
Other Distributions.......................................... None None None
Redemption Fee (2)............................................. 2.00% 2.00% 2.00%
Exchange Fee................................................... None None None
Annual Fund Operating Expenses
(expenses deducted from Fund assets)
Management Fees................................................ 0.20% 0.20% 0.25%
Distribution (12b-1) Fees...................................... None None None
Other Expenses
Administrative Fees......................................... 1.29%(3) 0.74%(4) 0.70%(4)
Other Fees.................................................. 0.01% 0.01% 0.00%
Total Annual Fund Operating Expenses........................... 1.50% 0.95% 0.95%
- --------
(1)"Prior" expenses reflect the fees and expenses of the Equity Fund prior to
August 3, 2006. "Current" expenses reflect the fees and expenses of the
Equity Fund effective August 3, 2006. For the columns and/or rows that show
"prior" and "current" expenses, the table and the following example reflect
the aggregate fees and expenses of the Equity Fund and of the Master Fund.
(2)If you redeem or exchange your shares within 60 days of purchase or
acquisition through exchange, you will be charged a redemption fee equal to
2.00% of the net asset value of the shares redeemed or exchanged. However,
the redemption fee will not apply to redemptions or exchanges of shares
acquired through the reinvestment of dividends or distributions. There is no
additional charge to have a check mailed to you. There is a $15 fee to have
your check sent to you via overnight delivery. There is a $10 fee to have
your redemption proceeds wired to your bank account.
(3)Under an Administrative Services Agreement in effect until August 3, 2006,
Green Century, the administrator of the Fund, paid the operating expenses of
the Fund (excluding interest, taxes, brokerage costs and other capital
expenses and any extraordinary expenses). For this and other services, the
Fund paid Green Century an Administrative Fee at a rate such that the Equity
Fund's total annual expenses were limited to 1.50% of the Equity Fund's
average net assets.
(4)Under an Administrative Services Agreement effective August 3, 2006, Green
Century, the administrator of the Fund, pays the operating expenses of the
Fund (excluding interest, taxes, brokerage costs and other capital expenses
and any extraordinary expenses). For this and other services, the Fund pays
Green Century an Administrative Fee at a rate such that the Equity Fund's
total annual expenses are limited to 0.95% of the Equity Fund's average net
assets. Green Century cannot increase the Fund's administrative fee without
the approval of the Fund's Board of Trustees.
Example. This example is intended to help you compare the costs of investing in
the Fund with the cost of investing in other mutual funds. This example assumes
that: (1) you invest $10,000 in the Fund; (2) you redeem all of your shares at
the end of the periods shown; (3) you earn a 5% return each year; and (4) the
operating expenses remain the same. Although your actual costs may be higher or
lower, based on these assumptions your costs would be:
1 Year 3 Years 5 Years 10 Years
------ ------- ------- --------
Prior.................... $153 $474 $818 $1791
Current.................. $ 97 $303 $525 $1166
Proposed................. $ 97 $303 $525 $1166
If the Advisory Agreement is approved, the investment advisory fees payable
by the Fund will increase. However, as a result of Green Century's contractual
agreement to reduce its administrative fee, the total annual Fund operating
expenses have decreased from 1.50% to 0.95%.
7
Information about Green Century
Green Century, a Massachusetts corporation with principal offices located at
114 State Street, Suite 200, Boston, MA 02109, is currently the administrator
for the Equity Fund. Green Century has served as the Fund's administrator since
the Fund commenced operations in 1995. Green Century is also the investment
adviser and administrator for the Green Century Balanced Fund and oversees the
portfolio management of the Balanced Fund on a day-to-day basis. Green Century
has served as investment adviser and administrator for the Balanced Fund since
the commencement of operations of the Balanced Fund in 1992. Green Century does
not currently provide investment advisory services to any other funds.
Green Century was founded in 1991 by a partnership of not-for-profit
environmental advocacy organizations for the following purposes: to provide
quality environmentally responsible investment opportunities to the members of
its founding organizations and other environmentally conscious investors; to
generate revenue to support the environmental research and advocacy work of its
founding organizations; and to work in tandem with its founding organizations
to promotefor greater corporate environmental responsibilityresponsibility.
Trustee Nominee and Officer Information
The table below sets forth each Nominee’s name, age, position and length of service with the Funds, each Nominee’s principal occupation during the past five years, and any other directorships held by advocating that
companies improve their environmental performance. As do the advocacy
organizations that founded Green Century, Green Century upholds the right of
people to speakeach Nominee. The address for the public interest and corporate responsibility.
Green Century is wholly owned by Paradigm Partners, a California general
partnership, the partners of which are all not-for-profit advocacy
organizations. These organizations are: California Public Interest Research
Group (CALPIRG); Citizen Lobby of New Jersey; Colorado Public Interest Research
Group; ConnPIRG Citizen Lobby; Fund for Public Interest Research; Massachusetts
Public Interest Research Group (MASSPIRG); MOPIRG Citizen Organization; PIRGIM
Public Interest Lobby; and Washington State Public Interest Research Group
(WASHPIRG). MASSPIRG owns approximately 46% of Paradigm Partners.
Management and Governance. Listed below are the names, positions and
principal occupations of the directors and officers of Green Century or its
affiliates as of June 30, 2006. The principal business address of the principal
executive officer and directors of Green Centuryeach Nominee is 114 State Street, Suite 200, Boston, MA 02109. Certain directors and officers of Green Century are also
Trustees and/or officers of the Fund, as noted below:
Name and Age | Position(s) | Principal Occupation(s) | Other Held | Number of Funds in Green Century Family of Funds Overseen by Nominee | ||||
Independent Trustees*: | ||||||||
Jonathan Darnell Age: 54 | Trustee Nominee | Managing Director, Pickwick Capital Partners (since 2014); President/Founder, Patolan Partners (since 2011); Vice President, Morgan Stanley, Private Wealth Management Group, (2004-2011). | Advisory Board member, CardioReady LLC; Board member, Voices for Progress. | 2 | ||||
Laurie Moskowitz Age: 49 | Trustee Nominee | Senior Director, Campaigns, US & Canada, The ONE Campaign (since 2011); Founder and Principal Partner, FieldWorks (2001-2011). | None | 2 | ||||
Name and Age | Position(s) | Principal Occupation(s) | Other Held | Number of Funds in Green Century Family of Funds Overseen by Nominee | ||||
Bancroft R. Poor Age: 58 | Trustee since 2014 | Vice President for Operations/Chief Financial Officer/Assistant Treasurer, Massachusetts Audubon Society (since 1994) | Trustee and Chair of Finance and Administration Committee, the Quebec Labrador Foundation (since 2007); Director and Treasurer of US Offshore Wind Collaborative (2010-2013). | 2 | ||||
Mary Raftery Age: 49 | Trustee since 2009 | Funder Collaborations, ClimateWorks Foundation (since 2014); Organizational Development Consultant, Self-employed (since 2007); Director of Major Donor Development and Special Projects, BlueGreen Alliance (2011-2012); Chief Operating Officer, Apollo Alliance (2007-2011). | None | 2 | ||||
Name and Age | Position(s) | Principal Occupation(s) | Other Held | Number of Funds in Green Century Family of Funds Overseen by Nominee | ||||
James H. Starr Age: 66 | Independent Chairperson since 2009, Trustee since 1991 | Senior Attorney, Starr and Associates, PC (since 1982); County Commissioner, Gunnison County, CO (1999-2010). | Director and President, Gunnison Valley Housing Foundation (since 2011); Director and Vice President, Cool Creek Watershed Commission (since 2011); Chairperson, Gunnison Valley Transportation Authority (2004-2010); President, Peanut Mine, Inc. (2002-2012); Director and Secretary, Crested Butte Land Trust (1991-2009). | 2 | ||||
Interested Trustees**: | ||||||||
John Comerford Age: 45 | Trustee since 2005 | Member, Board of Directors, BATS Global Markets (since 2011); Executive Managing Director, Instinet (since 2007). | None | 2 | ||||
Name and Age | Position(s) | Principal Occupation(s) | Other Held | Number of Funds in Green Century Family of Funds Overseen by Nominee | ||||
Douglas H. Phelps Age: 66 | Trustee since 1997 | President (1996-2003) and Director (since 1996), Green Century | None | 2 | ||||
Wendy Wendlandt Age: 52 | Trustee since 1991 | President (2006-2013) and Director (since 2006), Green | None | 2 | ||||
* A Trustee is deemed to be an “Independent Trustee” to the extent the Trustee is not an “interested person” of the Funds as that term is defined in the Investment Company Act of 1940, as amended (the “1940 Act”).
** A Trustee is deemed to be an “Interested Trustee” to the extent the Trustee is an “interested person” of the Funds as defined in the 1940 Act. Mr. Comerford is considered to be an Interested Trustee by virtue of his position with Instinet, a broker-dealer that may conduct business with each Fund’s subadviser. Mr. Phelps is considered to be an Interested Trustee by virtue of his positions as a Director of Green Century and with the Public Interest Network. Ms. Wendlandt is considered to be an Interested Trustee by virtue of her positions as a Director of Green Century and with the Public Interest Network.
The table below sets forth each Officer of the Funds, her name, age, position and length of service with the Funds and principal occupation during the past five years. The address for each Officer is 114 State Street, Suite 200, Boston, MA 02109.
Name and Age | Position(s) Held with | Principal Occupation(s) During Past Five Years | ||
Kristina A. Curtis Age: 61 | President since 2005; Treasurer since 2008 and from 1991-2005 | Senior Vice President of Finance and Operations (since 2002), Treasurer and Director (since 1991), Senior Vice President (since 1991), Green | ||
Amy F. Puffer Age: 55 | Chief Compliance Officer since 2004; Secretary and Assistant Treasurer since 2006 | Chief Compliance Officer, (since 2004); Clerk and Director (since 2006), Green | ||
Trustee Nominees’ Biographies and Qualifications
The Trustees are experienced business people, attorneys and non-profit organization managers who meet periodically throughout the year to oversee the Funds’ activities, review contractual arrangements with companies that provide services to the Funds, oversee management of the risks associated with such activities and contractual arrangements, and review the Funds’ performance and expenses, among other reviews and assessments. In determining that a particular Trustee was and continues to be qualified to serve as a Trustee, the Board has considered a variety of criteria, none of which, in isolation, was controlling. The Board believes that, collectively, the individual Trustees have balanced and diverse experience, qualifications, attributes, and skills, which allow the Board, as a whole, to operate effectively in governing the Funds and protecting the interests of shareholders. In addition, each Trustee is committed to the Funds’ and Green Century’s mission of offering environmentally responsible and fossil fuel free mutual funds and advocating for greater corporate environmental accountability. Information about the specific experience, skills, attributes, and qualifications of each Trustee, which in each case led to the Board’s conclusion that the Trustee should serve (or continue to serve) as a trustee of the Funds, is provided in the table above, and in the following paragraphs. References to experience, qualifications, attributes and/or skills of Trustees do not constitute holding out the Board or any Trustee as having special expertise or experience, and shall not impose any greater responsibility or liability on any Trustee or on the Board by reason thereof.
Jonathan Darnell is the founder and owner of a private placement firm, specializing in the alternative energy and biomedical sectors. Previously he was a Vice President at Morgan Stanley in Private Wealth Management, the Firm’s ultra-high net worth division, where he provided investment advice and portfolio management services across all asset classes for clients with combined total capital exceeding five billion dollars. Prior to that, he served in various senior management and board capacities at the Public Interest Network of environmental and citizen advocacy organizations.
Mr. Darnell’s qualifications to serve as a Trustee include his extensive experience in the investment industry as well as his many years of involvement in public policy and commercial aspects of renewable power generation and resource conservation.
Laurie Moskowitz is currently the Senior Director for Campaigns, U.S. & Canada, for The ONE Campaign. She is responsible for creating high impact campaigns to secure public and political support for overseas development assistance from the U.S. Government and international multi-lateral institutions.
Previously, she was the founder and principal partner of FieldWorks, a campaign planning firm, managing all aspects of the business, including marketing and promotion, project development, client relations, budget oversight, administration, legal and human resources. Prior to that, she worked for the Democratic National Committee and various political campaigns.
Ms. Moskowitz’s qualifications to serve as a Trustee include her extensive experience as an organizational leader, strategic thinker, manager and business owner as well as her history of campaign work.
Bancroft Poor is currently the Vice President for Operations, the Chief Financial Officer and an Assistant Treasurer for the Massachusetts Audubon Society. He is in charge of all of Mass Audubon’s financial, administrative, information technology, human resources, and capital assets and planning functions. Previously, he was the Finance Director for the Massachusetts Public Interest Research Group and prior to that, worked in research and management consulting positions. He has been a Trustee of the Funds, and has served as the Chair of the Funds’ Audit Committee, since 2014. He also currently serves on the Funds’ Valuation Committee.
Mr. Poor’s qualifications to serve as Trustee include his finance, administration and project management expertise as well as his extensive experience as a senior manager or board member for several non-profit and environmental organizations.
Mary Raftery is currently the Senior Advisor, Funder Collaborations, at ClimateWorks Foundation, which supports public policies that are designed to address climate change. She previously served as the Chief Operating Officer and as the Director of Major Donor Development and Special Projects at two national non-profit organizations promoting a green economy. She has been a Trustee of the Funds, and has served on the Funds’ Qualified Legal Compliance Committee, since 2009. She also currently serves on the Funds’ Nominating Committee.
Ms. Raftery’s qualifications to serve as a Trustee include her extensive experience in non-profit management, as well as her work on environmental issues with labor unions, businesses, environmental groups and foundations in the U.S. and Europe.
James Starr is the founder and owner of a law firm in Colorado and is also the Director and President of the Gunnison Valley Housing Foundation and the Director and Vice President of the Cool Creek Watershed Commission, both based in Colorado. He has been a Trustee of the Funds since the Funds’ inception in 1991 and has served as the Independent Chairperson of the Board of Trustees since 2009. He also currently serves on the Funds’ Audit, Nominating and Qualified Legal Compliance Committees.
Mr. Starr’s qualifications to serve as a Trustee of the Funds include his experience as a lawyer and small business owner and his work on numerous community service activities and service on many community boards for over 30 years.
John Comerford is currently an Executive Managing Director of Instinet, one of the largest brokers in the electronic trading market. He has served as a portfolio manager and equity trader and has led the development of securities trading software products. He holds the professional accreditation of a Certified Financial Analyst. He has been a Trustee of the Funds since 2005 and has served on the Funds’ Valuation Committee since 2007.
Mr. Comerford’s qualifications to serve as a Trustee include his over 20 years of experience in the securities, financial services and brokerage industries and his ability to offer counsel on investment matters.
Douglas Phelps is President and Executive Director of the Public Interest Network, a foundry for change organizations. He also Chairs the Board of U.S. PIRG, the federation of State PIRGs, and Chairs the Advisory Board of the Fund for the Public Interest, a national non-profit that runs grass-roots campaigns to raise money, sign up members, educate the public and build political support for some of the nation’s leading public interest
non-profits such as the PIRGs, Environment America and the Human Rights Campaign. Mr. Phelps chairs the board of Green Corps, the field school for environmental organizing, and serves on the Board of the National Environmental Law Center. He has served as a Trustee of the Funds since 1997. He also has served as President (1996 to 2003) and Director (since 1996) of Green Century.
Mr. Phelps’ qualifications to serve as a Trustee of the Funds include his long tenure with Green Century and his extensive experience as a board member or chair of several non-profit and environmental organizations.
Wendy Wendlandt is the Political Director for The Public Interest Network. Over the last 30 years, she has helped secure millions of dollars in foundation grants, expand the breadth and depth of coalitions around issues ranging from campaign finance reform to genetically engineered foods, and play a lead role in campaigns that have won dozens of tangible results for public health and the environment. Ms. Wendlandt has served as a Trustee of the Funds since the Funds’ inception in 1991 and has also served as President (2006-2013) and Director (since 2006) of Green Century.
Ms. Wendlandt’s qualifications to serve as Trustee of the Funds include her executive management experience with non-profit organizations and her long collaboration with Green Century.
Trustee Oversight Responsibilities
The Chairperson of the Board of Trustees of the Funds is an Independent Trustee, as defined in the 1940 Act. He presides at meetings of the Board and at executive sessions of the Independent Trustees. The Independent Chairperson is appointed by a majority of the Independent Trustees. It is the policy of the Board that the Independent Chairperson of the Board, with full responsibilities as a chairperson would generally have, will continue to be an Independent Trustee. The Board of Trustees has determined that having its Chairperson be an Independent Trustee is in the best interests of the Funds’ shareholders.
The Board has four standing committees, described in more detail below. Through the committees, particularly the Audit Committee, the Independent Trustees consider and address important matters involving the Funds, including those presenting conflicts or potential conflicts of interest with management. The Board has determined that delegation to the committees of specified oversight responsibilities helps ensure that the Funds have effective independent governance and oversight. The Board has determined that its leadership and committee structure is appropriate given Green Century’s role with respect to the Funds’ investment and business operations. The Board believes that the leadership and committee structure provides effective management for the relationships between the Funds, Green Century and the Funds’ other principal service providers, and facilitates the exercise of the Board’s independent judgment in evaluating and managing the relationships.
Like other mutual funds, the Funds are subject to risks, including investment, compliance, operational and valuation risks, among others. The Board oversees risk as part of its oversight of the Funds. Risk oversight is addressed as part of various Board and committee activities. The Board, directly or through its committees, interacts with and reviews reports from, among others, the Funds’ investment adviser and administrator, Green Century, the Funds’ Chief Compliance Officer (CCO), the Funds’ investment subadvisers, and the Funds’ independent registered public accounting firm, as appropriate, regarding risks faced by the Funds and risk management.
The Board has designated the CCO to be responsible for the Funds’ compliance policies and procedures. The CCO reports to the Independent Trustees of the Board and is responsible for delivering, at least annually, a written report on compliance and other required or agreed on matters to the Board. The Independent Trustees of the Board also meet with the CCO, separately from management, generally at least annually, to address compliance issues and other relevant matters.
The actual day-to-day risk management functions with respect to the Funds are subsumed within the responsibilities of the investment adviser and administrator, the subadvisers, and other service providers, depending upon the nature of the risk. In the course of its interactions with the various service providers, the Board has emphasized the importance of maintaining vigorous risk management programs and procedures. The Trustees recognize that not all risks that may affect the Funds can be identified. Processes and controls developed cannot eliminate or mitigate the occurrence or effects of all risks, and some risks may be simply beyond any processes, procedures or controls of the Board, the Funds, Green Century, or other service providers. As a result of the foregoing and for other reasons, the Board’s risk management oversight is subject to substantial limitations.
Compensation of Trustees
No Trustee of the Funds receives any compensation from the Funds, but each Trustee is reimbursed for any out-of-pocket expenses incurred in attending meetings of the Board of Trustees or of any committee thereof. Information regarding compensation paid to the Trustees of the Funds for Public President, Grassroots
Interest Research. Trustee Campaigns, Inc.
8
Portfolio Transactions
For the fiscal year ended July 31, 2006, brokerage transactions were2013 is set forth below. The Funds do not placed withcontribute to a retirement plan for the Trustees of the Funds. The Officers do not receive any person affiliated withdirect remuneration from the Equity Funds.
Name of Person, Position | Aggregate | Pension or Retirement Benefits Accrued as Part of Funds Expenses | Estimated Annual Benefits Upon Retirement | Total Compensation from Funds and Green Century Fund Complex Paid to Trustees | ||||
Independent Trustees: | ||||||||
Mary Raftery | None | None | None | None | ||||
James H. Starr | None | None | None | None | ||||
Interested Trustees: | ||||||||
John Comerford | None | None | None | None | ||||
Douglas H. Phelps | None | None | None | None | ||||
Wendy Wendlandt | None | None | None | None | ||||
Fund Shares Owned by Trustee Nominees
The following table shows the amount of equity securities beneficially owned by each Nominee in the Green Century UMB Fund
Services, Inc. (the Fund's subadministrator),Family of Funds as of June 30, 2014.
Name of Trustee Nominee | Dollar Range of Equity Securities in Fund/Fund Name | Aggregate Dollar Green Century Fund Family | ||
Independent Nominees: | ||||
Jonathan Darnell | None | None | ||
Laurie Moskowitz | None | None | ||
Bancroft R. Poor | None | None | ||
Mary Raftery | None | None | ||
James H. Starr | $10,001-$50,000/Green Century Equity Fund $10,001-$50,000/Green Century Balanced Fund | $10,001-$50,000 | ||
Name of Trustee Nominee | Dollar Range of Equity Securities in Fund/Fund Name | Aggregate Dollar Green Century Fund Family | ||
Interested Nominees: | ||||
John Comerford | None | None | ||
Douglas H. Phelps | over $100,000/Green Century Equity Fund over $100,000/Green Century Balanced Fund | over $100,000 | ||
Wendy Wendlandt | $10,001-$50,000/Green Century Equity Fund $10,001-$50,000/Green Century Balanced Fund | $10,001-$50,000 | ||
As of July 22, 2014, none of the current Independent Trustees of the Funds or nominees for Independent Trustee, or their immediate family members, owned beneficially or of record any securities of Green Century, UMB Distribution Services, LLC (the Fund's distributor), Unified Fund Services, Inc. (the Fund's transfer
agent), or Investors Bank & Trust Company (the Fund's custodian)(“UMB”), the Master
Fund, DSIL (the Master Fund's investment adviser), SSgA (the Master Fund's
current investment subadviser)Funds’ distributor, or DSIL Investment Services LLC (the Master
Fund's distributor).
Evaluationany person controlling, controlled by or under common control with Green Century or UMB. “Beneficial ownership” is determined in accordance with Rule 16a-1(a)(2) under the 1934 Act.
As of July 22, 2014, the Trustees, Nominees and Officers of the Funds, individually and as a group, owned beneficially or had the right to vote less than 1% of the outstanding shares of each Fund.
Meetings and Committees
Board of Trustees
At an in-person meeting on August 3, 2006,Meetings.During the fiscal year ended July 31, 2013, the Board of Trustees of the Equity Fund, including a majorityFunds met four times. Each Trustee (other than John Comerford and Douglas Phelps) attended at least 75% of the Independent Trustees, consideredmeetings during the approvalfiscal year ended July 31, 2013. Bancroft R. Poor was not a Trustee of the Advisory Agreement betweenFunds during the fiscal year ended July 31, 2013.
Shareholder communications intended for the Board of Trustees (or one or more specified Trustees) may be sent to them in writing, to the Secretary of the Funds, in care of Green Century Funds on behalfCapital Management, Inc., 114 State Street, Suite 200, Boston, MA 02109.
Audit Committee. Stephen J. Morgan*, Bancroft R. Poor and James H. Starr, each an Independent Trustee, are members of the Equity FundAudit Committee. The Audit Committee met once during the Funds’ fiscal year ended July 31, 2013 to select the auditor, review the Funds’ financial statements and Green Century that would become effective uponaudited annual report, to receive the withdrawalreport of the Equity Fund's investment inFunds’ independent auditors, and to review the Master Fund.
In connection with their deliberations at that meeting,internal and at a separate
executive sessionexternal accounting procedures of the Funds. Messrs. Morgan and Starr attended this meeting. Mr. Poor was not a Trustee of the Funds during the fiscal year ended July 31, 2013.
Nominating Committee. Stephen J. Morgan*, Mary Raftery and James H. Starr, each an Independent Trustees also held on August 3, 2006,Trustee, are members of the Trustees considered,Nominating Committee. The Nominating Committee is responsible for, among other things, information providedscreening and nominating candidates to serve on the Board of Trustees. The Nominating Committee evaluates candidates’ qualifications for board membership. The Nominating Committee Charter provides that the Committee shall require that candidates for Trustee have a college degree or equivalent business experience. Further, the Nominating Committee Charter provides that the Committee shall take into account at least the following factors when considering each candidate for Trustee: (i) the availability and commitment of the candidate to attend meetings and perform his or her responsibilities on the Board; (ii) the candidate’s relevant experience; (iii) the candidate’s educational background; (iv) the candidate’s ability, judgment and expertise; and
(v) the overall diversity of the Board’s composition. The Committee does not have a formal procedure for the implementation, or for assessing the effectiveness, of its policy with regard to the consideration of diversity on the Board in reviewing potential nominees for Independent Trustee. The Committee will consider and evaluate candidates submitted by shareholders of the Funds on the same basis as it considers and evaluates candidates recommended by other sources. Shareholder recommendations should be delivered in writing to the Secretary of the Funds, c/o Green Century regarding (1)Capital Management, Inc. The Nominating Committee did not meet during the nature, qualityFunds’ fiscal year ended July 31, 2013. The Nominating Committee met nine times during the period from August 1, 2013 through June 30, 2014. Mr. Morgan attended eight of these meetings, Mr. Starr attended all of these meetings and extentMs. Raftery attended eight of these meetings. A copy of the services proposedNominating Committee Charter is attached to be
providedthis Proxy Statement as Exhibit A.
Valuation Committee.John Comerford and Bancroft R. Poor are members of the Valuation Committee. The Valuation Committee monitors the valuation of fund investments. The Valuation Committee did not meet during the most recent fiscal year.
Qualified Legal Compliance Committee. Stephen J. Morgan*, James H. Starr and Mary Raftery, each an Independent Trustee, are members of the Qualified Legal Compliance Committee (“QLCC”) of the Board of Trustees of the Funds. The QLCC is authorized to receive, evaluate and investigate reports of material violations of law as prescribed by Section 307 of the Sarbanes-Oxley Act of 2002, which shall include, without limitation, the authority to retain such legal counsel and expert personnel as the QLCC may deem necessary and to notify the SEC in the event the Funds fail to implement a recommendation of the QLCC following an investigation. The QLCC did not meet during the most recent fiscal year.
* Mr. Morgan is retiring from the Board effective the date of the shareholder meeting, including adjournments.
Nomination by the Nominating Committee and the Board of Trustees
At a meeting of the Board’s Nominating Committee held on June 23, 2014, the Committee nominated Jonathan Darnell, Laurie Moskowitz, Bancroft R. Poor, Mary Raftery and James H. Starr to serve as Independent Trustees of the Funds and John Comerford, Douglas H. Phelps and Wendy Wendlandt to serve as Interested Trustees of the Funds. The Nominating Committee considered the criteria set forth in the Nominating Committee Charter, as described above under “Nominating Committee”, in nominating the Nominees for election or re-election as applicable, as Trustees. With respect to each new Independent Trustee Nominee, Green Century torecommended the Fund, (2) expenses ofNominee. At the Fund andJune 25, 2014 meeting, the advisory fee proposed to be paid to Green Century, and (3) the prospective
profitability of the proposed Advisory Agreement to Green Century. The
Independent Trustees were advised by independent counsel in considering these
materials and the approval of the Advisory Agreement. The Trustees considered
all the information provided to them by Green Century, including information
provided throughout Green Century's tenure as investment adviser to the Green
Century Balanced Fund. The Trustees had previously been provided with a
memorandum prepared by their independent counsel with respect to the applicable
legal standards, including the factors to be considered, in connection with the
Trustees' review of the Advisory Agreement. In approving the Advisory Agreement
at the meeting held on August 3, 2006, the Trustees,Board, including the Independent Trustees, did not identify any single factor as determinative. Matters
considered in connection with their approvalagreed that each Nominee Trustee of the Agreement included the
following.
Nature, Quality,Funds should be submitted to shareholders for approval and Extent of Services Performed. The Trustees considered
the scopevoted to nominate such Nominees and qualityrecommend election of the services proposed to be performed forNominees by the Equity
Fund by Green Century, including the resources to be dedicated by Green
Century. These services included the oversight to be provided by Green Century
with respect to the portfolio management and performanceshareholders of the Equity Fund in
tracking the Index; the implementation of the environmental policies of the
Equity Fund by voting the Equity Fund's shareholder proxies; and the overall
compliance oversight of the Equity Fund and its other service providers to be
provided by Green Century.
The Trustees also considered that Green Century, upon the direction of the
Trustees, had negotiated a licensing agreement with KLD that would allow the
Equity Fund to continue its existing strategy of investing in a portfolio that
seeks to track the Index. The Trustees considered Green Century's resources and
abilities to be dedicated to marketing the Equity Fund and its ability to
coordinate efforts with KLD to promote the Fund.
In addition, the Trustees considered the administrative services provided by
Green Century, including the oversight and coordination of the activities of
all of the Equity Fund's other service providers.
Based on their review of all the services proposed to be provided and their
analysis of Green Century's ability to provide those services, including its
past demonstrated abilities, the Trustees concluded that Green Century had the
capabilities, resources and personnel necessary to provide advisory services to
the Equity Fund under the Advisory Agreement.
Costs of Services Provided and Profitability. The Trustees considered the
proposed advisory fees to be paid to Green Century by the Equity Fund and the
prospective profitability and fall-out benefits to Green Century
9
from the proposed arrangement with the Equity Fund. The Trustees reviewed and
considered an analysis of the proposed advisory fee, subadvisory fee and total
expense ratio of the Equity Fund, and comparative data for other mutual funds.
The Trustees reviewed the level of the proposed advisory fees compared to
the advisory fees paid by other mutual funds with similar investment objectives
and strategies as the Equity Fund. The Trustees noted that, based on the
information provided, the proposed advisory fees to be paid to Green Century
were lower than the average advisory fees paid by other socially responsible
mutual funds; higher than the average fees paid by equity index funds; and
comparable with the average advisory fees for equity index funds with under
$100 million in assets. The Trustees also considered that the proposed overall
level of fees, including the advisory fee, was lower than the overall present
fee level, including the advisory fee for the Equity Fund's investment in the
Master Fund.
Green Century provided the Trustees with information relating to the
prospective profitability of the Advisory Agreement to Green Century. In that
regard, the Trustees considered the proposed subadvisory fee and the other
expenses that would be incurred by Green Century in providing advisory services
to the Equity Fund. The Trustees also considered that Green Century has
proposed an Amendment to the Administrative Services Agreement for the Equity
Fund which would reduce the total annual expenses of the Fund to 0.95% of the
Fund's average net assets while the expenses to be incurred by Green Century in
providing services to the Fund would increase under the new structure.
The Trustees considered that Green Century stated that it would not realize
a profit on the management of the Equity Fund until assets increase
significantly above current levels. In considering the cost allocation
methodology used by Green Century, the Trustees took under consideration that
Green Century does not provide advisory or administrative services to other
mutual fund or non-mutual fund clients other than those services it provides to
the Green Century Balanced Fund. The Trustees also considered Green Century's
non-profit ownership structure, its cost structure and personnel needs, and its
investment in shareholder advocacy to further the Equity Fund's stated
objective of promoting greater corporate environmental accountability. After
reviewing the information described above, the Trustees, including the
Independent Trustees, concluded that the fees provided in the Advisory
Agreement, taking into account the costs of the services provided by the
Adviser and the profitability to the Adviser of its proposed relationship with
the Equity Fund, supported the approval of the Advisory Agreement. The Trustees
also concluded that the fees proposed in the Advisory Agreement were fair and
reasonable in light of the usual and customary charges made by others for
services of the same nature and quality.
Other Benefits. The Trustees evaluated potential other benefits Green
Century may realize from its relationship with the Equity Fund. The Trustees
noted that Green Century would not receive any brokerage fees or soft dollar
benefits from its relationship with the Equity Fund. The Trustees also
considered the reputational and other advantages Green Century may gain from
its relationship with the Equity Fund. The Trustees concluded that the benefits
expected to be received by Green Century were reasonable in the context of the
relationship between Green Century and the Equity Fund, and supported the
approval of the Advisory Agreement.
Investment Performance. The Trustees reviewed and considered information
regarding the investment performance of accounts managed by Green Century and
considered Green Century's experience in evaluating, recommending and
overseeing investment subadvisers who conduct day-to-day portfolio management.
The Trustees noted that Green Century would be responsible for monitoring the
performance of the subadviser in tracking the Index. After considering all the
factors deemed appropriate, the Trustees concluded that Green Century's
experience in overseeing investment subadvisers together with Green Century's
experience in environmentally and socially responsible investing supported the
approval of the Advisory Agreement.
Economies of Scale. The Trustees also considered whether economies of scale
could be realized by Green Century as the Equity Fund grew in asset size and
the extent to which such economies of scale were reflected in
10
the proposed fee schedule. They noted the relatively small size of the Equity
Fund and considered that if the assets were to increase, Green Century could
have the opportunity to experience economies of scale as fixed costs would
become a smaller percentage of the Fund's assets and some of the Fund's service
providers' fees, as a percentage of the Fund's assets, could decrease. They
also noted that pursuant to the proposed Advisory Agreement, the advisory fees
proposed to be paid to Green Century include breakpoints at $100 million, $500
million and $1 billion. The Trustees concluded that economies of scale might be
realized as the Fund grew, and that the fee schedule as proposed was
appropriate at the present time, and supported the approval of the Advisory
Agreement.
Based on their review of all factors deemed relevant, the Trustees,
including a majority of the Independent Trustees, concluded that the Advisory
Agreement should be approved and submitted to the Equity Fund's shareholders
for approval. The Trustees also noted that they would consider whether to renew
the Advisory Agreement after an initial two-year period and annually thereafter.
Funds.
Vote Required
A
The affirmative vote of a majorityplurality of the outstanding voting securities of the Equity Fund
(within the meaning of the 1940 Act) will be required to approve the Advisory
Agreement. Under the 1940 Act, a "vote of a majority of the outstanding voting
securities" of the Equity Fund means the affirmative vote by holders of the
lesser of (a) 67% or more of the voting power of the Equity Fund's outstanding
voting securities present at a meeting if holders of more than 50% of the
voting power of the Equity Fund's outstanding voting securities are presentvotes cast, voted in person or by proxy or (b) more than 50%at the Special Meeting, is required for the election of the voting power of the Equity
Fund's outstanding voting securities.
The Advisory Agreement will not go into effect unless the Subadvisory
Agreement described in Proposal 2 is also approved by shareholders of the
Equity Fund. In the event that the Advisory Agreement and the Subadvisory
Agreement do not receive the requisite shareholder approval,each Nominee to the Board of Trustees will continueof the Fund's investment in the Master Fund, or negotiate a
new investment advisory agreement with a different advisory organization or
make other appropriate arrangements subject to approval of shareholders in
accordance with the 1940 Act. In the event the Board of Trustees continues the
Fund's investment in the Master Fund, the Fund's investment objectiveFunds.
If you sign and return your proxy but give no voting instructions, your shares will be changed to match the investment objective of the Master Fund.
votedFORall Nominees named herein.
The Board of Trustees recommends that you vote FOR Otherapprovalthe election of each of the Advisory
Agreement.
Proposal 2.To Approve an Investment Subadvisory Agreement among the Equity
Fund, Green Century Capital Management, Inc. and Mellon Equity
Associates, LLP.
If shareholders approve the Advisory Agreement, Green Century will be
responsible for the management of the Equity Fund. As part of its
responsibilities, Green Century may select and employ, subjectNominees to the review
and approval of the Board of Trustees and that of shareholders, as may be
required, one or more subadvisers to invest the Equity Fund's assets consistent
with the Fund's investment objective to achieve long-term total return that
matches the performance of the Domini 400 Social/SM/ Index (the "Index"), an
index of stocks of 400 companies selected based on social and environmental
criteria. Green Century and the Board of Trustees will regularly review the
subadviser's performance. Green Century or the Board of Trustees may terminate
the services of a subadviser at any time, subject to the termination provisions
of a subadvisory agreement.
Green Century has recommended, and the Board of Trustees has approved, the
appointment of Mellon Equity Associates, LLP ("Mellon Equity") as the
investment subadviser of the Equity Fund. If this proposal and the Advisory
Agreements are approved by shareholders of the Equity Fund as provided herein,
the Subadvisory Agreement will go into effect on November 28, 2006.
If shareholders approve the Subadvisory Agreement, Mellon Equity will be
responsible for investing the Fund's assets in a manner consistent with the
terms of the Subadvisory Agreement and the investment objective
11
of the Fund. Mellon Equity's primary responsibility will be to ensure that the
portfolio holdings of the Fund match the composition of the Index as closely as
possible. Mellon Equity will not select the stocks that make up the Index.
Terms of the Subadvisory Agreement
Please refer to Exhibit B attached to this Proxy Statement for the complete
Subadvisory Agreement. The description of the Subadvisory Agreement in this
Proxy Statement is qualified in its entirety by the provisions of the
Subadvisory Agreement in Exhibit B.
Pursuant to the Subadvisory Agreement, Mellon Equity will implement the
daily portfolio transactions necessary to maintain the proper correlation
between the assets of the Fund and the Index, subject always to the provisions
of the 1940 Act and to the investment objective, policies and restrictions
imposed by the Equity Fund's then-current Registration Statement under the 1940
Act and the Fund's Declaration of Trust and By-Laws. Mellon Equity will not
determine the composition of the Index. Mellon Equity will also provide Green
Century and the Board of Trustees with such reports and data as may be
requested from time to time. Mellon Equity will furnish at its own expense all
services, facilities and personnel necessary in connection with its activities
under the Subadvisory Agreement. The Subadvisory Agreement provides that Mellon
Equity may render services to others.
The Subadvisory Agreement also provides that Mellon Equity will obtain for
the Equity Fund, in its judgment, best available execution in executing the
Equity Fund's portfolio transactions, and shall direct orders in connection
with the purchase and sale of the Equity Fund's portfolio securities to
broker-dealers that sell shares of the Equity Fund only to the extent that
placing such orders is in compliance with applicable laws. The Subadvisory
Agreement provides that Mellon Equity may not use commissions paid to
broker-dealers in connection with the purchase or sale of Fund securities to
generate so-called "soft dollars". The Subadvisory Agreement provides that
Mellon Equity may aggregate orders for the purchase or sale of portfolio
securities for the Equity Fund with orders for other portfolios managed by
Mellon Equity. Securities purchased or proceeds of securities sold through
aggregate orders are allocated at the average execution price.
The Subadvisory Agreement provides that Mellon Equity is not liable for any
error of judgment or for any act or omission in the execution of securities
transactions for the Equity Fund, except for willful misfeasance, bad faith,
negligence, violation of law or reckless disregard of its obligations and
duties under the Subadvisory Agreement.
If approved by the shareholders of the Equity Fund, the Subadvisory
Agreement will become effective on November 28, 2006 and will continue in
effect for two years, and thereafter will continue in effect if such
continuance is specifically approved at least annually by vote of the holders
of a "majority of the outstanding voting securities" (as defined in the 1940
Act) of the Equity Fund or by vote of a majority of the Fund's Board of
Trustees, and in either case by the vote of a majority of the Trustees who are
not "interested persons" (as defined in the 1940 Act) at a meeting called for
the purpose of voting on the Subadvisory Agreement.
The Subadvisory Agreement may be terminated without penalty (i) by the
Equity Fund's Board of Trustees or by a vote of a majority of the outstanding
voting securities of the Equity Fund on not more than 60 days' nor less than 30
days' prior written notice to Mellon Equity and Green Century, (ii) by Green
Century upon not more than 60 days' nor less than 30 days' prior written notice
to the Equity Fund and Mellon Equity or (iii) by Mellon Equity upon not less
than 180 days' prior written notice to the Equity Fund and Green Century. The
Subadvisory Agreement will automatically terminate in the event of its
assignment.
12
Investment Subadvisory Fees
Green Century (not the Equity Fund) will pay subadvisory fees to Mellon
Equity out of the investment advisory fees Green Century receives from the
Equity Fund under the Advisory Agreement discussed in Proposal No. 1.
If shareholders approve the Subadvisory Agreement, Green Century will pay to
Mellon Equity, as full compensation for services to be rendered and expenses to
be borne by Mellon Equity, a fee equal on an annual basis to the greater of
$50,000, or 0.08% of the value of the average daily net assets of the Fund up
to but not including $100 million, 0.05% of the average daily net assets of the
Fund from and including $100 million up to but not including $500 million,
0.02% of the average daily net assets of the Fund from and including $500
million up to but not including $1 billion and 0.01% of the average daily net
assets of the Fund equal to or in excess of $1 billion. Such fee will be
accrued daily and payable following the end of each calendar quarter.
Information about Mellon Equity
Mellon Equity, with principal offices located at One Mellon Center, Suite
4200, Pittsburgh, PA 15258, is an independently run, wholly owned subsidiary of
Mellon Financial Corporation, organized as a Pennsylvania limited liability
partnership. The firm's proprietary investment process, developed in 1982 by
current principal officers of the firm, has been used to manage domestic equity
accounts for U.S. tax-exempt clients since January 1983. The firm became a
separate legal entity from the equity management group of the Mellon Bank Trust
Department in January 1987, managing domestic equity accounts for U.S.
tax-exempt clients. The firm was registered as an investment advisor in 1986
and became a separate legal entity in 1987. As of June 30, 2006, Mellon Equity
managed over $20 billion in assets, including approximately $1.2 billion in
socially responsible portfolios for 35 accounts.
Partners in Mellon Equity
Listed below are the names and ownership status of the partners in Mellon
Equity as of June 30, 2006. The primary business address of each partner is One
Mellon Center, Suite 4200, Pittsburgh, PA 15258.
Name Ownership Status
---- ----------------
MMIP, LLC* General Partner
Mellon Bank, N.A.** Limited Partner
- --------
* MMIP, LLC owns a 1% interest in Mellon Equity. The sole member of MMIP, LLC
is Mellon Bank, N.A.
** Mellon Bank, N.A. owns a 99% interest in Mellon Equity. The sole shareholder
of Mellon Bank, N.A. is Mellon Financial Corporation.
13
Management and Governance
Listed below are the names, positions and principal occupations of the
members of the Executive Committee and the principal executive officers of
Mellon Equity as of June 30, 2006. The principal business address of all
members of the Executive Committee and all principal executive officers is One
Mellon Center, Suite 4200, Pittsburgh, PA 15258.
Name Position with Mellon Equity Board. Principal Occupation
---- --------------------------- --------------------------
Ronald P. O'Hanley Chairman, Executive
Committee Member N/A
Stephen E. Canter Executive Committee Member N/A
Joseph J. Nagoniak Executive Committee Member N/A
William P. Rydell President, Chief
Executive Officer,
Executive Committee Member N/A
Patricia K. Nichols Executive Vice
President, Chief
Operating Officer,
Executive Committee Member N/A
Robert A. Wilk Chief Investment
Officer, Senior Vice
President, Executive
Committee Member N/A
Scott E. Wennerholm Executive Committee Member N/A
As of June 30, 2006, no Trustee or Officer of the Equity Fund is an officer,
director, general partner or shareholder of Mellon Equity.
Mellon Equity provides investment advisory services to another fund that has
a similar investment objective as the Equity Fund. Information concerning this
mutual fund, including the net assets of such fund and the fee paid to Mellon
Equity for its services to such fund, is provided in the table below.
Net Assets of Fund as of
Name of Fund 6/30/06 Fee Paid to Mellon Equity
- ------------ ------------------------ -------------------------
Dreyfus Stock Index Fund $3.9 billion 0.095% of average daily net assets
All information contained in this Proxy Statement about Mellon Equity has
been provided by Mellon Equity.
Evaluation by the Board of Trustees
At an in-person meeting on August 24, 2006, the Board of Trustees of the
Equity Fund, including a majority of the Independent Trustees, considered the
approval of the Subadvisory Agreement among the Green Century Funds on behalf
of the Equity Fund, Green Century, and Mellon Equity that would become
effective upon the withdrawal of the Equity Fund's investment in the Master
Fund.
In connection with their deliberations at that meeting, and at a separate
executive session of the Independent Trustees also held on August 24, 2006, the
Trustees considered, among other things, information provided by Green Century
and Mellon Equity regarding (1) the nature, quality and extent of the services
proposed to be provided by Mellon Equity to the Fund, (2) expenses of the Fund
and the subadvisory fee proposed to be paid to
14
Mellon Equity, and (3) the prospective profitability of the proposed
Subadvisory Agreement to Mellon Equity. The Independent Trustees were advised
by independent counsel in considering these materials and the approval of the
Subadvisory Agreement. The Trustees considered all the information provided to
them by Green Century and Mellon Equity. The Trustees had previously been
provided with a memorandum prepared by their independent counsel with respect
to the applicable legal standards, including the factors to be considered, in
connection with the Trustees' review of the Subadvisory Agreement. In approving
the Subadvisory Agreement at the meeting held on August 24, 2006, the Trustees,
including the Independent Trustees, did not identify any single factor as
determinative. Matters considered in connection with their approval of the
Agreement included the following.
Nature, Quality, and Extent of Services Performed. The Trustees considered
the scope and quality of the services proposed to be performed for the Equity
Fund by Mellon Equity, including the resources to be dedicated by Mellon
Equity, and its general reputation in the investment industry. The Trustees
considered Mellon Equity's experience and expertise in conducting trading
operations, managing portfolios with investment strategies similar to the
Equity Fund, and managing registered investment companies for other third
parties. In particular, the Trustees considered the fact that Mellon Equity had
demonstrated its familiarity with and experience in respect of the Index and
that it had broad familiarity with social investment indexes. The Trustees also
considered the information provided to the Trustees by representatives of
Mellon Equity at the meeting with respect to the financial statements of Mellon
Financial Corporation, assets under management, trading capability, performance
data presented, and the experience of the Mellon Equity team that would be
providing services to the Equity Fund. The Trustees also considered Mellon
Equity's compliance policies and procedures and compliance record, and
interviewed Mellon Equity's Chief Compliance Officer.
Based on their review of all the services proposed to be provided and their
analysis of Mellon Equity's ability to provide those services, the Trustees
concluded that Mellon Equity had the capabilities, resources and personnel
necessary to provide subadvisory services to the Equity Fund under the
Subadvisory Agreement.
Costs of Services Provided and Profitability. The Trustees considered the
proposed subadvisory fees to be paid to Mellon Equity by Green Century and the
prospective profitability and fall-out benefits to Mellon Equity from the
proposed arrangement with the Equity Fund. The Trustees reviewed and considered
an analysis of the proposed subadvisory fee compared to the subadvisory fees
paid by other mutual funds with similar investment objectives and strategies as
the Equity Fund. The Trustees noted that, based on the information provided,
the proposed subadvisory fees to be paid to Mellon Equity were lower than the
average subadvisory fees paid by other socially responsible mutual funds, lower
than the average subadvisory fees paid by large-capitalization growth funds,
and higher than the average subadvisory fees paid by equity index funds. The
Trustees noted that the fees proposed in the Agreement were subject to a
minimum annual amount at current asset levels, and that at higher asset levels
the subadvisory fee would be comparable with the average subadvisory fees paid
by equity index funds. The Trustees also considered that the proposed
subadvisory fee would be paid by Green Century and not by the Fund and that
pursuant to an amended Administrative Services Agreement, Green Century had
previously agreed to lower the total annual expenses of the Fund.
Mellon Equity provided the Trustees with information regarding the
prospective profitability of the Subadvisory Agreement to Mellon Equity. In
that regard, the Trustees considered the expenses that would be incurred by
Mellon Equity in providing subadvisory services to the Equity Fund. Mellon
Equity provided information to the Trustees on its cost allocation methodology
used in arriving at its projected initial annual estimate of the expenses to be
incurred by it in connection with its services to the Equity Fund. The Trustees
considered that Mellon Equity projected a slight loss at current asset levels
and noted that Mellon Equity projected that it would realize a profit when the
Equity Fund's assets reach approximately double their current size. The
Trustees also considered Mellon Equity's fee structure and what it charges
similar investment company clients and determined that the proposed subadvisory
fees were within range, if not lower, than the fees Mellon Equity charges its
other clients for which it manages passive equity accounts. After reviewing the
information described above and in view of the discussions with representatives
of Mellon Equity at the meeting, the Trustees, including the Independent
Trustees, concluded that the fees provided in the Subadvisory Agreement, taking
into account the costs of the services provided by Mellon Equity and the
profitability to Mellon Equity of its proposed relationship
15
with the Equity Fund, supported the approval of the Subadvisory Agreement. The
Trustees also concluded that the fees proposed in the Subadvisory Agreement
were fair and reasonable in light of the usual and customary charges made by
others for services of the same nature and quality.
Other Benefits. The Trustees evaluated potential other benefits Mellon
Equity may realize from its relationship with the Equity Fund. The Trustees
noted that Mellon Equity does not execute trades for index portfolios with any
affiliated broker-dealer or to generate soft dollar benefits; therefore neither
Mellon Equity nor its affiliates would receive brokerage fees or soft dollars
due to its relationship with the Equity Fund. The Trustees also considered the
reputational and other advantages Mellon Equity may gain from its relationship
with the Equity Fund. The Trustees concluded that the benefits expected to be
received by Mellon Equity were reasonable in the context of the proposed
relationship and supported the approval of the Subadvisory Agreement.
Investment Performance. The Trustees reviewed and considered information
regarding the investment performance of accounts managed by Mellon Equity,
including performance information provided by Mellon Equity on other portfolios
it manages which track established indexes. The Trustees also reviewed the
tracking error data provided by Mellon Equity. After considering all the
factors deemed appropriate, the Trustees concluded that Mellon Equity's
experience in managing portfolios with passive investment strategies supported
the approval of the Subadvisory Agreement.
Economies of Scale. The Trustees noted Mellon Equity stated that it would
benefit from economies of scale as the Fund grew and that the proposed
Subadvisory Agreement included breakpoints that reflected the projected
economies at larger asset levels. The Trustees considered that pursuant to the
proposed Agreement, the fees to be paid to Mellon Equity included breakpoints
at $100 million, $500 million and $1 billion. The Trustees concluded that the
fee schedule as proposed was appropriate at the present time, and supported the
approval of the Subadvisory Agreement.
Based on their review of all factors deemed relevant, the Trustees,
including a majority of the Independent Trustees, concluded that the
Subadvisory Agreement should be approved and submitted to the Equity Fund's
shareholders for approval. The Trustees also noted that they would consider
whether to renew the Subadvisory Agreement after an initial two-year period and
annually thereafter.
Vote Required
A vote of a majority of the outstanding voting securities of the Equity Fund
(within the meaning of the 1940 Act) will be required to approve the
Subadvisory Agreement. Under the 1940 Act, a "vote of a majority of the
outstanding voting securities" of the Equity Fund means the affirmative vote by
holders of the lesser of (a) 67% or more of the voting power of the Equity
Fund's outstanding voting securities present at a meeting if holders of more
than 50% of the voting power of the Equity Fund's outstanding voting securities
are present in person or by proxy or (b) more than 50% of the voting power of
the Equity Fund's outstanding voting securities.
The Subadvisory Agreement will not go into effect unless the Advisory
Agreement is also approved by shareholders of the Equity Fund. In the event
that the Advisory Agreement and the Subadvisory Agreement do not receive the
requisite shareholder approval, the Board of Trustees will continue the Fund's
investment in the Master Fund, or negotiate a new investment subadvisory
agreement with a different advisory organization or make other appropriate
arrangements subject to approval of shareholders in accordance with the 1940
Act. In the event the Board of Trustees continues the Fund's investment in the
Master Fund, the Fund's investment objective will be changed to match the
investment objective of the Master Fund.
The Board of Trustees recommends that you vote FOR approval of the Mellon
Equity Subadvisory Agreement.
Proposal 3.To transact such other business as may properly come before the
Special Meeting of Shareholders and any adjournments of the Special
Meeting.
The management of the Equity FundFunds knows of no other business to be presented at the Meeting. If any additional matters should be properly presented, it is intended that the enclosed proxy will be voted in accordance with the judgment of the persons named in the enclosed form of proxy.
16
PART 4. INFORMATION REGARDING THE EQUITY FUND.
FUNDS.
Interests of Certain Persons
As of September 8, 2006,the July 22, 2014, to the best knowledge of the Equity Fund,Funds, the following persons owned of record 5% or more of the outstanding shares of the Equity Fund:
Record Owner | Number of Shares | Percent of Shares | ||||||
Green Century Balanced Fund | ||||||||
Charles Schwab & Company | 1,098,119.314 | 21.52 | % | |||||
National Financial Services Corporation | 721,584.846 | 14.14 | % | |||||
Mac and Company | 311,113.822 | 6.10 | % | |||||
Green Century Equity Fund | ||||||||
Charles Schwab & Company | 975,314.602 | 31.08 | % | |||||
National Financial Services Corporation | 409,960.179 | 13.06 | % | |||||
TD Ameritrade | 166,211.370 | 5.30 | % | |||||
*Owners of record, not beneficial owners
Independent Registered Public Accounting Firm
The Board has selected KPMG LLP (“KPMG”) to serve as the independent public accountant for each Fund. Representatives of KPMG are not expected to be present at the Special Meeting, but will have the opportunity to make a statement if they wish, and will be available by telephone to respond to appropriate questions.
Accounting Fees and Services for the Trust
The information under each of the subheadings below show the aggregate fees KPMG billed to the Trust and the Adviser for its professional services rendered for the Funds’ most recently completed fiscal years.
Audit Fees. The aggregate fees billed for each of the last two fiscal years for professional services rendered by KPMG for the audit of the Funds’ annual financial statements or services that are normally provided by KPMG in connection with statutory and regulatory filings or engagements for those fiscal years are set forth below:
For the fiscal year ended July 31, 2013: $37,400.00
For the fiscal year ended July 31, 2012: $36,400.00
Audit-Related Fees. There were no fees billed for the Funds’ two most recently completed fiscal years for assurance and related services by the principal accountant that are reasonably related to the performance of the audit of the Funds’ financial statements and are not reported under theAudit Feescaption above.
Tax Fees. The aggregate fees billed in each of the last two fiscal years for professional services rendered by KPMG for tax compliance, tax advice and tax planning are set forth below. The services comprising the fees disclosed under this category are tax compliance monitoring and tax filing preparation.
For the fiscal year ended July 31, 2013: $10,800.00
For the fiscal year ended July 31, 2012: $10,400.00
All Other Fees. There were no other fees billed for the Funds’ two most recently completed fiscal years for products and services provided by KPMG, other than the services reported under theAudit Fees,Audit-Related Fees,orTax Fees captions above.
Aggregate Non-Audit Fees. The aggregate non-audit fees billed by KPMG for services rendered to the Funds were the tax compliance, tax advice and tax planning fees listed in theTax Fees caption above and are set forth below. No non-audit fees were billed by KPMG for services rendered to the Funds’ investment adviser or any entity controlling, controlled by, or under common control with the investment adviser that provides ongoing services to the Funds for the last two fiscal years of the Funds.
For the fiscal year ended July 31, 2013: $10,800.00
For the fiscal year ended July 31, 2012: $10,400.00
Audit Committee Pre-Approval Policies and Procedures
The Charter of the Audit Committee of the Board requires that the Committee approve (a) all audit and permissible non-audit services to be provided to the Funds and (b) all permissible non-audit services to be provided by the Funds’ independent auditors to the Funds’ investment adviser or administrator or any entity controlling, controlled by, or under common control with the Funds’ investment adviser or administrator that provides ongoing services to the Funds, if the engagement relates directly to the operations and financial reporting of the Funds. The Audit Committee has the duty to consider whether the non-audit services provided by the Funds’ auditor to the Funds’ investment adviser, administrator, or any adviser affiliate that provides ongoing services to the Funds, which services were not pre-approved by the Audit Committee, are compatible with maintaining the auditor’s independence and to review and approve the fees proposed to be charged to the Funds by the auditors for each audit and non-audit service.
There were no services described above (including services required to be approved by the Audit Committee pursuant to paragraph (c)(7)(ii) of Rule 2-01 of Regulation S-X) that were approved by the Audit Committee pursuant to paragraph (c)(7)(i)(C) of Rule 2-01 of Regulation S-X. None of the hours expended on the principal accountant’s engagement to audit the Funds’ financial statements for the fiscal year ended July 31, 2013 were attributable to work performed by persons other than the principal accountant’s full-time, permanent employees.
Additional Information
The
Each Fund is a series of the Green Century Funds (the "Trust"“Trust”), a diversified, open-end registered investment company organized as a Massachusetts business trust under a Declaration of Trust dated as of July 1, 1991. The Balanced Fund was designated as a separate series of the Trust on July 1, 1991. The Equity Fund was designated as a separate series of the Trust on April 7, 1995. The mailing address of the Trust is 114 State Street, Suite 200, Boston, MA 02109.
Green Century is the Funds’ investment adviser and administrator. Trillium Asset Management LLC serves as the subadviser for the Green Century Balanced Fund. The Fund's distributorprincipal business address of Trillium Asset Management LLC is Two Financial Center, 60 South Street, Suite 1100, Boston, MA 02111. Northern Trust Investments, Inc. serves as the subadviser for the Green Century Equity Fund. The principal business address of Northern Trust Investments, Inc. is 50 South LaSalle Street, Chicago, IL 60603. UMB Distribution Services, LLC.is the Funds’ distributor. The principal business address of UMB Distribution Services, LLC is 803235 West MichiganGalena Street,
Suite A, Milwaukee, WI 53233. Unified Fund53212. Huntington Asset Services, Inc. acts as transfer agent and dividend disbursing agent for theeach Fund. The principal business address of Unified FundHuntington Asset Services, Inc. is 4312960 North Pennsylvania Street,Meridian, Suite 300, Indianapolis, IN 46204-18061. Investors46208. State Street Bank &and Trust Company ("IBT")(State Street) acts as the custodian for each of the Fund. IBT'sFunds. State Street’s principal business address is 200 ClarendonOne Lincoln Street, Boston, Massachusetts 02116.
02111.
Shareholders Sharing the Same Address
If two or more shareholders share the same address, only one copy of this proxy statement may be delivered to that address, ifunless the Trust has received suchcontrary instructions from one or more of the shareholders at that shared address. Upon written or oral request, the Trust will promptly deliver a separate copy of this proxy statement to a shareholder at a shared address. Please note that each shareholder (other than joint account shareholders) will receive a separate proxy card, regardless of whether he or she resides at a shared address. Please call 1-800-221-5519 or forward a written request to the Trust at Green Century Funds, PO Box 6110, Indianapolis, IN 46206-6110 if you would like to (1) receive a separate copy of this proxy statement; (2) receive your annual reports or proxy statements separately in the future; or (3) request delivery of a single copy of annual reports or proxy statements if you are currently receiving multiple copies at a shared address.
Submission of Certain Proposals
The Trust is a Massachusetts business trust and as such is not required to hold annual meetings of shareholders, although special meetings may be called for the Fund,Funds, for purposes such as electing Trustees or removing Trustees, changing fundamental policies, or approving an advisory contract. Shareholder proposals to be presented at any subsequent meeting of shareholders must be received by the Trust at the Trust'sTrust’s office within a reasonable time before the next proxy solicitation is made.
By Order of the Board of Trustees,
Amy F. Puffer, Secretary
September 15, 2006
17
| By Order of the Board of Trustees, |
Amy Puffer, Secretary |
August 12, 2014
Exhibit A
INVESTMENT ADVISORY AGREEMENT
INVESTMENT ADVISORY AGREEMENT, dated as of November 28, 2006, by and among
GREEN CENTURY CAPITAL MANAGEMENT, INC., a Massachusetts corporation having its
principal place of business in Boston, Massachusetts (the "Adviser"), and
GREEN CENTURY FUNDS a Massachusetts business trust created pursuant to a Declaration
of Trust dated as of July 1, 1991, as amended from time to time (the "Trust")
on behalf of the Green Century Equity Fund.
WHEREAS, the Trust has been organized to operate as an open-end diversified
management investment company registered under the Investment Company Act of
1940, as amended (the "1940 Act"); and
WHEREAS, the shares of beneficial interest (par value $0.01 per share) of
the Trust are divided into two separate series, Green Century Balanced Fund
(the "Balanced Fund") and Green Century Equity Fund (the "Equity Fund") (each,
along with any series which may in the future be established, a "Series"); and
WHEREAS, the Trust on behalf of the Equity Fund desires to avail itself of
the services, information, advice, assistance and facilities of an investment
adviser and to have an investment adviser perform for it various investment
advisory and research services and other management services; and
WHEREAS, the Adviser has been organized to operate as an investment adviser
registered under the Investment Advisers Act of 1940, as amended, and desires
to provide investment advisory services to the Trust on behalf of the Equity
Fund;
NOW, THEREFORE, in consideration of the terms and conditions hereinafter set
forth, it is agreed as follows:
1. Employment of the Adviser. The Trust hereby employs the Adviser to manage
the investment and reinvestment of the assets of the Equity Fund subject to the
control and direction of the Trust's Board of Trustees, for the period and on
the terms hereinafter set forth. The Adviser hereby accepts such employment and
agrees during such period to render the services and to assume the obligations
herein set forth for the compensation herein provided. The Adviser shall for
all purposes herein be deemed to be an independent contractor and shall, except
as expressly provided or authorized (whether herein or otherwise), have no
authority to act for or represent the Trust in any way or otherwise be deemed
an agent of the Trust.
2. Obligations of and Services to be Provided by the Adviser. In providing
the services and assuming the obligations set forth herein, the Adviser may, at
its expense, employ one or more subadvisers. References herein to the Adviser
shall include any subadviser employed by the Adviser. Any agreement between the
Adviser and a subadviser shall be subject to the renewal, termination and
amendment provisions of paragraph 9 hereof. The Adviser undertakes to provide
the following services and to assume the following obligations:
a. The Adviser shall manage the investment and reinvestment of the assets
of the Equity Fund, subject to and in accordance with the investment
objectives and policies of the Equity Fund and any directions which the
Trust's Board of Trustees may issue from time to time. In pursuance of the
foregoing, the Adviser shall make all determinations with respect to the
investment of the assets of the Equity Fund and the purchase and sale of
portfolio securities and shall take such steps as may be necessary to
implement the same. Such determination and services shall also include
determining the manner in which voting rights, rights to consent to
corporate action
Nominating Committee Charter
| 1. | The Nominating Committee (the “Committee”) of the Board of Trustees (the “Board” or the “Board of Trustees”) of the Green Century Funds (the “Trust” or the “Funds”) shall be composed entirely of Independent Trustees, none of whom shall be an “interested person” of the Funds, as that term is defined in Section 2(a)(19) of the Investment Company Act of 1940. The Committee shall be comprised of as many Independent Trustees as the Board shall determine, but in no event fewer than two (2) Independent Trustees. The Board may remove or replace members of the Committee for any reason by majority vote of the Independent Trustees of the Board. |
| 2. | The primary purpose and responsibility of the Nominating Committee is the screening and nomination of candidates to serve on the Board of Trustees (each, a “Candidate”). |
| 3. | To carry out its purposes, the Committee shall have the authority and responsibility to determine the minimum qualifications that a Candidate is required to have and the factors that the Committee will consider in reviewing Candidates. Presently, the Committee has determined to: |
| a. | require that Candidates have a college degree or equivalent business experience; |
| b. | take into account at least the following factors when considering each Candidate: |
| i. | the availability and commitment of the Candidate to attend meetings and perform his or her responsibilities on the Board; |
| ii. | the Candidate’s relevant experience; |
| iii. | the Candidate’s educational background; |
| iv. | the Candidate’s ability, judgment and expertise; and |
| v. | the overall diversity of the Board’s composition; and |
| c. | consider Candidates recommended by one or more of the following sources: |
| i. | the Trust’s current Trustees; |
| ii. | the Trust’s officers; |
| iii. | the Trust’s investment adviser or sub-adviser; |
| iv. | shareholders of either Fund (see below); and |
any other rights pertaining tosource the portfolio securities
shall be exercised. The Adviser shall render regular reports to the Trust's
Board of Trustees concerning the Trust's investment activities.
b. The Adviser shall, in the name of the Equity Fund, place orders for
the execution of the Equity Fund's portfolio transactions in accordance with
the policies with respect thereto set forth in the Trust's
A-1
registration statements under the 1940 Act and the Securities Act of 1933,
as such registration statements may be amended from time to time. In
connection with the placement of orders for the execution of the Equity
Fund's portfolio transactions, the Adviser shall create and maintain all
necessary brokerage records of the Trust in accordance with all applicable
laws, rules and regulations, including but not limited to records required
by Section 31(a) of the 1940 Act. All records shall be the property of the
Trust and shall be available for inspection and use by the Securities and
Exchange Commission (the "SEC"), the Trust or any person retained by the
Trust. Where applicable, such records shall be maintained by the Adviser for
the periods and in the places required by Rule 31a-2 under the 1940 Act.
c. The Adviser shall bear its expenses of providing services to the Trust
pursuant to this Agreement except such expenses as are undertaken by the
Trust. In addition, the Adviser shall pay the salaries and fees, if any, of
all Trustees, executive officers and employees of the Trust who are
affiliated persons, as defined in Section 2(a)(3) of the 1940 Act, of the
Adviser.
3. Compensation of Adviser.
a. As compensation for the services rendered and obligations assumed
hereunder by the Adviser, the Trust shall pay to the Adviser monthly a fee
from the Equity Fund equal on an annual basis to 0.25% of the average daily
net assets of the Equity Fund up to but not including $100 million, 0.22% of
the average daily net assets of the Equity Fund from and including $100
million up to but not including $500 million, 0.17% of the average daily net
assets of the Equity Fund from and including $500 million up to but not
including $1 billion, and 0.12% of the average daily net assets of the
Equity Fund equal to or in excess of $1 billion. Such fee shall be computed
and accrued daily. If Green Century Capital Management, Inc. serves as
investment adviser for less than the whole of any period specified in this
Section 3a, the compensation to Green Century Capital Management, Inc., as
Adviser, shall be prorated. For purposes of calculating the Adviser's fee,
the daily value of the Equity Fund's net assets shall be computed by the
same method as the Trust uses to compute the value of the Equity Fund's net
assets in connection with the determination of net asset value of the Equity
Fund's shares.
b. The Adviser reserves the right to waive all or part of its fee.
4. Activities of the Adviser. The services of the Adviser to the Trust
hereunder are not to be deemed exclusive, and the Adviser shall be free to
render similar services to others. It is understood that the Trustees and
officers of the Trust are or may become interested in the Adviser as
stockholders, officers or otherwise, and that stockholders and officers of the
Adviser are or may become similarly interested in the Trust, and that the
Adviser may become interested in the Trust as a shareholder or otherwise.
5. Use of Names. The Trust shall not use the name of the Adviser in any
prospectus, sales literature or other material relating to the Trust in any
manner not approved prior thereto by the Adviser; provided, however, that the
Adviser shall approve all uses of its name which merely refer in accurate terms
to its appointment hereunder or which are required by the SEC or a state
securities commission; and provided further, that in no event shall such
approval be unreasonably withheld. The Adviser shall not use the name of the
Trust in any material relating to the Adviser in any manner not approved prior
thereto by the Trust; provided, however, that the Trust shall approve all uses
of its name which merely refer in accurate terms to the appointment of the
Adviser hereunder or which are required by the SEC or a state securities
commission; and, provided further, that in no event shall such approval be
unreasonably withheld.
The Trustees of the Trust acknowledge that, in consideration of the
Adviser's assumption of certain organization and ongoing expenses of the Trust,
the Adviser has reserved for itself the right to the names "Green Century
Funds", "Green Century Money Market Fund", "Green Century Equity Fund" and
"Green Century Balanced Fund" (or any similar names) and that use by the Trust
of such names shall continue only with the continuing consent of the Adviser,
which consent may be withdrawn at any time, effective immediately, upon written
notice thereof to the Trust.
A-2
6. Limitation of Liability of the Adviser. Absent willful misfeasance, bad
faith, gross negligence, or reckless disregard of obligations or duties
hereunder on the part of the Adviser, the Adviser shall not be subject to
liability to the Trust or to any shareholder of the Equity Fund for any act or
omission in the course of, or connected with, rendering services hereunder or
for any losses that may be sustained in the purchase, holding or sale of any
security. As used in this Section 6, the term "Adviser" shall include Green
Century Capital Management, Inc. and/or any of its affiliates and the
Directors, officers and employees of Green Century Capital Management, Inc.
and/or of its affiliates.
7. Limitation of Trust's Liability. The Adviser acknowledges that it has
received notice of and accepts the limitations upon the Trust's liability set
forth in its Declaration of Trust. The Adviser agrees that the Trust's
obligations hereunder in any case shall be limited to the Trust and to its
assets and that the Adviser shall not seek satisfaction of any such obligation
from the shareholders of the Equity Fund nor from any Trustee, officer,
employee or agent of the Trust.
8. Force Majeure. The Adviser shall not be liable for delays or errors
occurring by reason of circumstances beyond its control, including but not
limited to acts of civil or military authority, national emergencies, work
stoppages, fire, flood, catastrophe, acts of God, insurrections, war, riot, or
failure of communication or power supply. In the event of equipment breakdowns
beyond its control, the Adviser shall take reasonable steps to minimize service
interruptions but shall have no liability with respect thereto.
9. Renewal, Termination and Amendment. This Agreement shall continue in
effect, unless sooner terminated as hereinafter provided, for a period of two
years from the date hereof and indefinitely thereafter, if its continuance
after such two-year period shall be specifically approved at least annually by
vote of the holders of a majority of the outstanding voting securities of the
Equity Fund or by vote of a majority of the Trust's Board of Trustees; and
further provided that such continuance is also approved annually by the vote of
a majority of the Trustees who are not parties to this Agreement or interested
persons of the Adviser, cast in person at a meeting called for the purpose of
voting on such approval. If such approval is not obtained, this Agreement shall
terminate on the date which is 15 months from the last such approval. This
Agreement may be terminated at any time, without payment of any penalty, by the
Trust's Board of Trustees or by a vote of the majority of the outstanding
voting securities of the Equity Fund upon 60 days' prior written notice to the
Adviser and by the Adviser upon 60 days' prior written notice to the Trust.
This agreement may be amended at any time by the parties hereto, subject to
approval by the Trust's Board of Trustees and, if required by applicable SEC
rules and regulations, a vote of the majority of the outstanding voting
securities of the Equity Fund. This Agreement shall terminate automatically in
the event of its assignment. The terms "assignment" and "majority of the
outstanding voting securities" shall have the meaning set forth for such terms
in the 1940 Act.
10. Severability. If any provision of this Agreement shall be held or made
invalid by a court decision, statute, rule or otherwise, the remainder of this
Agreement shall not be affected thereby.
11. Miscellaneous. Each party agrees to perform such further actions and
execute such further documents as are necessary to effectuate the purposes
hereof. The Agreement shall be construed and enforced in accordance with and
governed by the laws of the Commonwealth of Massachusetts. The captions in this
Agreement are included for convenience only and in no way define or delimit any
of the provisions hereof or otherwise affect their construction or effect.
A-3
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed and delivered in their names and on their behalf by the undersigned,
thereunto duly authorized, all as of the day and year first above written.
Pursuant to the Trust's Declaration of Trust, dated as of July 1, 1991, and as
amended, the obligations of this Agreement are not binding upon any of the
Trustees or shareholders of the Trust individually, but bind only the Trust
estate.
Committee deems appropriate.
| 4. | The Committee may, but is not required to, retain a third party search firm at the Trust’s expense to identify potential Candidates. |
| 5. | The Committee will consider and evaluate Candidates submitted by shareholders of the Funds on the same basis as it considers and evaluates Candidates recommended by other sources. Shareholder recommendations should be delivered in writing to the Secretary of the Trust, c/o Green Century Capital Management, Inc. |
| 6. | Meetings of the Committee will follow the following procedures: |
| a. | The Committee will not have regularly scheduled meetings. Committee meetings shall be held as and when the Committee or the Board determines necessary or appropriate in accordance with the Trust’s By-laws. |
| b. | The Committee may meet either in person or by telephone, and the Committee may act by unanimous written consent, to the extent permitted by law and by the Funds’ organizational documents. |
| c. | A majority of the members shall constitute a quorum for the transaction of business at any meeting of the Committee. The action of a majority of the members present at a meeting at which a quorum is present shall be the action of the Committee. If the Committee consists of two members then a majority of the Committee will be equal to two members. |
| d. | The Committee may select one of its members to be its chair. |
| e. | The Committee shall prepare and retain minutes of its meetings and appropriate documentation of decisions made outside of meetings by delegated authority. |
| f. | The Committee shall maintain all documents received or reviewed by it for at minimum ten years. |
| 7. | This Charter has been adopted and approved by the Board of Trustees of the Funds and may be amended by the Board from time to time in compliance with applicable laws, rules, and regulations. |
June 2005
PO BOX 55909 BOSTON, MA 02205-5909 | Your Vote is Important! Vote by Internet Please go to the electronic voting site atwww.2voteproxy.com/gcf. Follow the on-line instructions. If you vote by internet, you need not return your proxy card. Vote by Telephone Please call us toll free at1-800-830-3542, and follow the instructions provided. If you vote by telephone, you need not return your proxy card. Vote by Mail Please complete, sign and date your proxy card and return it promptly in the enclosed envelope. Please ensure the address below shows through the window of the enclosed postage paid return envelope. PROXY TABULATOR PO BOX 55909 BOSTON, MA 02205-9100
|
PROXY
GREEN CENTURY FUNDS, ON BEHALF OF
THE
BALANCED FUND
GREEN CENTURY EQUITY FUND
BY
-----------------------------
Kristina A. Curtis
President
GREEN CENTURY CAPITAL MANAGEMENT,
INC.
BY
-----------------------------
Wendy Wendlandt
President
A-4
Exhibit B
INVESTMENT SUBADVISORY AGREEMENT
INVESTMENT SUBADVISORY AGREEMENT, dated as of November 28, 2006, by and
among GREEN CENTURY CAPITAL MANAGEMENT, INC., a Massachusetts corporation
having its principal place of business in Boston, Massachusetts (the
"Adviser"), MELLON EQUITY ASSOCIATES, LLP, a Pennsylvania limited liability
partnership, (the "Subadviser"), and GREEN CENTURY FUNDS, a Massachusetts
business trust (the "Trust") on behalf of Green Century Equity Fund.
WHEREAS, the Adviser has been organized to operate as an investment adviser
registered under the Investment Advisers Act of 1940 and has been retained by
the Trust to provide investment advisory services to the Trust, an open-end,
diversified management investment company registered under the Investment
Company Act of 1940, as amended (collectively with the rules and regulations
promulgated thereunder, in each case as in effect from time to time, the "1940
Act"); and
WHEREAS, the shares of beneficial interest (par value $0.01 per share) of
the Trust are divided into two separate series, Green Century Balanced Fund
(the "Balanced Fund") and Green Century Equity Fund (the "Equity Fund" or the
"Fund"); and
WHEREAS, the Adviser desires to retain the Subadviser to furnish it with
portfolio management services in connection with the Adviser's investment
advisory activities on behalf of the Equity Fund, and the Subadviser is willing
to furnish such services to the Adviser and the Trust;
NOW, THEREFORE, in consideration of the terms and conditions hereinafter set
forth, it is agreed as follows:
1. Employment of the Subadviser. In accordance with and subject to the
Investment Advisory Agreement between the Trust and the Adviser, attached
hereto as Exhibit A (the "Advisory Agreement"), the Adviser hereby appoints the
Subadviser to perform the portfolio management services described herein for
the investment and reinvestment of the assets of the Fund, subject to the
direction and supervision of the Adviser and the Trust's Board of Trustees, for
the period and on the terms hereinafter set forth. The Subadviser accepts such
employment and agrees to furnish the services described herein in accordance
with the terms of this Agreement and applicable law. The Subadviser shall for
all purposes herein be deemed to be an independent contractor and shall, except
as expressly provided or authorized (whether herein or otherwise), have no
authority to act for or represent the Trust or the Adviser in any way or
otherwise be deemed an agent of the Trust or the Adviser.
2. Obligations of and Services to be Provided by the Subadviser.
a. The Subadviser undertakes to provide the following services and to
assume the following obligations with respect to the Fund:
(1) The Subadviser, subject to and in accordance with the Fund's
investment objective, policies and restrictions as stated in the Trust's
Registration Statement(s) under the Securities Act of 1933 (the "1933
Act"), as it may be amended from time to time and as adopted by the
Trust's Board of Trustees from time to time, and the overall supervision
of the Trust's Board of Trustees and the Adviser, shall maintain a
continuing investment program for the Fund, including investment
research and management with respect to the investment and reinvestment
of the assets of the Fund, and shall take such steps as may be
reasonably necessary to implement the same. The Subadviser shall make
all trades for the Fund, engage in other actions as related to the Fund,
and maintain the portfolio of the Fund at all times in compliance with
the 1933 Act, the 1940 Act, and all applicable laws and regulations.
Should the Trust's Board of Trustees at any time establish an investment
policy with respect to the Fund and notify the Subadviser thereof in
writing, the Subadviser shall be bound by such determination for the
period, if any, specified in such notice or until notified in writing by
the Board of Trustees that such policy has been revoked.
B-1
(2) The Subadviser may not consult with any other subadviser to the
Fund concerning transactions in securities or other assets for the Fund.
(3) In connection with the purchase and sale of portfolio investments
of the Fund, the Subadviser shall arrange for the transmission to the
Adviser and the Trust's portfolio accountant, on a daily basis, of such
confirmations, trade tickets or other documentation as may be necessary
to enable the Adviser to perform its advisory and administrative
responsibilities. The Subadviser shall render such reports to the
Adviser, any subadministrator and/or to the Trust's Board of Trustees
concerning compliance, the investment activities and portfolio
composition of the Fund, in such forms and at such intervals, as the
Adviser or the Trust's Board of Trustees may from time to time
reasonably require.
(4) The Subadviser shall have the authority and discretion to select
brokers and dealers to execute the Fund's portfolio transactions and for
the selection of the markets on or in which the transactions will be
executed. In connection with the selection of such brokers or dealers
and the placing of such orders, the Subadviser is directed to seek for
the Fund, in its best judgment, prompt best available execution in an
effective manner. The Subadviser may not use commissions paid to
broker-dealers in connection with the purchase or sale of Fund
securities to generate so-called "soft dollars". Broker-dealers that
sell shares of the Fund or any other fund for which the Subadviser acts
as investment adviser or subadviser shall only receive orders for the
purchase or sale of the Fund's portfolio securities to the extent that
the placing of such orders is in compliance with applicable law and the
rules of the Securities and Exchange Commission (the "SEC") and the
National Association of Securities Dealers, Inc. In connection with the
placement of orders for the execution of portfolio transactions, and
subject to the direction and supervision of the Adviser and the Trust's
Board of Trustees, the Subadviser shall create and maintain all
necessary brokerage records of the Trust in accordance with all
applicable laws, rules and regulations, including but not limited to
records required by Section 31(a) of the 1940 Act.
(5) All records maintained by the Subadviser on behalf of the Adviser
or the Fund (including, without limitation, records maintained and
preserved by the Subadviser pursuant to Rule 31a-1 and Rule 31a-2
adopted under the 1940 Act) shall be the property of the Adviser or the
Trust, as applicable, and shall be available for inspection and use by
(or surrendered to) the SEC, the Trust or any person retained by the
Trust promptly upon request. Where applicable, such records shall be
maintained by the Subadviser for the periods and in the places required
by Rule 31a-1 and Rule 31a-2 under the 1940 Act, as applicable.
(6) The Subadviser shall not have any responsibility for determining
the manner in which voting rights shall be exercised.
(7) The assets of the Fund shall be held by one or more financial
institutions designated by the Fund in a custodial capacity (the
"Custodian") in an account which the Fund has directed the Custodian to
open. All transactions will be consummated by payment to or delivery by
the Custodian for the Fund or such depositories or agents as may be
designated by the Custodian of all cash and/or securities due to or from
the Fund, and the Subadviser shall not have possession or custody
thereof or any responsibility or liability with respect thereto. The
Subadviser shall advise the Custodian, the Trust's portfolio accounting
agent and the Adviser daily of all investments placed by its
broker/dealers pursuant to procedures agreed upon by the Subadviser and
the Adviser. The Adviser and the Trust shall issue to the Custodian such
instructions, and hereby authorize the Subadviser to issue to the
Custodian such instructions, as may be appropriate in connection with
the settlement of transactions initiated by the Subadviser. The Adviser
shall cause the Custodian to accept instructions from the Subadviser
with respect to Fund assets and transactions by the Fund in the
performance of the Subadviser's duties hereunder. The Adviser shall use
its best efforts to cause the Custodian to provide the Subadviser with
any such information and reports concerning the Fund or its assets as
the Subadviser may from time to time reasonably request, provided that
neither the Adviser nor the Fund shall be required to provide additional
compensation to the Custodian to provide any such information or report.
The Subadviser shall have no liability or obligation to pay the cost of
such Custodian or for any of its services.
B-2
b. The Subadviser represents to the Adviser and the Trust that it will
disclose to the Adviser and the Trust promptly after it has knowledge of any
significant change or variation in its management structure or personnel
which will affect the Fund or any significant change or variation in its
management style or investment philosophy which will affect the Fund. The
Subadviser shall promptly advise the Adviser of any change in the membership
of its partnership. In addition, the Subadviser represents to the Adviser
and the Trust that it will similarly disclose to the Trust and the Adviser,
promptly after it has knowledge, of the existence of any pending or
threatened significant legal or regulatory action or proceeding which in the
discretion of the Subadviser would have a material adverse affect on its
ability to provide services under this Agreement, provided that such
information is permitted to be disclosed by the Subadviser pursuant to
applicable law.
c. The Subadviser agrees that it will not deal with itself, or with the
Trustees of the Trust or with the Adviser, or the Fund's principal
underwriter or distributor as principals in making purchases or sales of
securities or other property for the account of the Fund, except as
permitted by the 1940 Act, will not take a long or short position in the
shares of the Fund except as permitted by the Trust's Declaration of Trust,
and will comply with all other applicable provisions of the Trust's
Declaration of Trust and By-Laws and any current Prospectus or Statement of
Additional Information of the Fund.
d. The Subadviser may manage other portfolios and expects that the Fund
and other portfolios it manages will, from time to time, purchase or sell
the same securities. Consistent with the Subadviser's fiduciary duties to
the Fund and applicable law, the Subadviser may aggregate orders for the
purchase or sale of securities on behalf of the Fund with orders on behalf
of other portfolios the Subadviser manages. Securities purchased or proceeds
of securities sold through aggregated orders are allocated to the account of
each portfolio managed by the Subadviser that bought or sold such securities
at the average execution price. If less than the total of the aggregated
orders is executed, purchased securities or proceeds will generally be
allocated pro rata among the participating portfolios in proportion to their
planned participation in the aggregated orders.
e. The Adviser understands and agrees that the Subadviser and its
officers, affiliates and employees perform investment advisory and
investment management services for various clients other than the Adviser
and the Fund.
3. Expenses. During the terms of this Agreement, the Subadviser will pay all
expenses incurred by it in connection with its activities under this Agreement.
The Subadviser shall not be obligated to pay any expenses of or for the Trust,
the Fund or the Adviser that are not expressly assumed by the Subadviser.
4. Compensation. The Adviser agrees to pay the Subadviser as full
compensation for the services to be rendered and expenses to be borne by the
Subadviser a fee equal on an annual basis to the greater of $50,000 or 0.08% of
the value of the average daily net assets of the Fund up to but not including
$100 million, 0.05% of the average daily net assets of the Fund from and
including $100 million up to but not including $500 million, 0.02% of the
average daily net assets of the Fund from and including $500 million up to but
not including $1 billion and 0.01% of the average daily net assets of the Fund
equal to or in excess of $1 billion. Such fee shall be accrued daily and
payable following the end of each calendar quarter.
The "average daily net assets" of the Fund shall mean the average of the
values placed on the Fund's net assets as of the close of regular trading on
the New York Stock Exchange (currently, 4:00 p.m. Eastern Time) on each day on
which the net asset value of the Trust is determined consistent with the
provisions of Rule 22c-1 under the 1940 Act. The value of the net assets of the
Fund shall always be determined pursuant to the applicable provisions of the
Declaration of Trust and the Fund's then current prospectus and statement of
additional information. If the determination of net asset value does not take
place for any particular day, then for the purposes of this Section 4, the
value of the net assets of the Fund last determined shall be deemed to be the
value of its net assets as of the close of regular trading on the New York
Stock Exchange, or as of such other time as the value of the net assets of the
Fund's portfolio may be lawfully determined on that day. If the Trust determines
B-3
the value of the net assets of the Fund more than once on any day, then the
last such determination thereof on that day shall be deemed to be the sole
determination thereof on that day for the purposes of this Section 4.
5. Renewal and Termination. This Agreement shall continue in effect with
respect to the Fund, unless sooner terminated as hereinafter provided, for a
period of two years from the date hereof and indefinitely thereafter if its
continuance after such two year period shall be "specifically approved at least
annually" by "vote of a majority of the outstanding voting securities" of the
Fund or by vote of a majority of the Trust's Board of Trustees; and further
provided that such continuance is also approved annually by the vote of a
majority of the Trustees who are not "interested persons" of the Adviser, the
Subadviser or the Trust, cast at a meeting called for the purpose of voting on
such approval as provided under the 1940 Act.
This Agreement may be terminated at any time, with respect to the Fund,
without payment of any penalty, (i) by the Trust's Board of Trustees or by the
"vote of a majority of the outstanding voting securities" of the Fund, upon not
more than 60 days' nor less than 30 days' prior written notice to the Adviser
and Subadviser, (ii) by the Adviser upon not more than 60 days' nor less than
30 days' prior written notice to the Trust and the Subadviser, or (iii) by the
Subadviser upon not less than 180 days' prior written notice to the Trust and
the Adviser. This Agreement will terminate automatically upon any termination
of the Advisory Agreement between the Trust and the Adviser or in the event of
its "assignment".
The terms "specifically approved at least annually", "interested persons",
"vote of a majority of the voting securities", and "assignment" when used in
this Agreement shall have the respective meanings specified in, and shall be
construed in a manner consistent with, the 1940 Act, subject, however, to such
exemptions as may be granted by the SEC under the 1940 Act.
6. Standard of Care. The Subadviser may rely on information reasonably
believed by it to be accurate and reliable. Neither the Subadviser nor its
officers, directors, or employees shall be subject to any liability for any act
or omission, or error of judgment or for any loss suffered by the Trust, the
Fund or the Adviser in the course of, connected with, or arising out of any
services to be rendered hereunder or for any losses that may be sustained in
the purchase, holding or sale of any security, except by reason of willful
misfeasance, bad faith or negligence on the part of the Subadviser in the
performance of its duties, violation of law, or by reason of reckless disregard
on the part of the Subadviser of its obligations and duties under this
Agreement.
7. Representations and Warranties. Each of the Adviser and the Subadviser
represents and warrants that: (a) the person(s) executing this Agreement on
behalf of such party has full power and authority to execute this Agreement on
behalf of such party and (b) such party's execution, delivery and performance
of this Agreement will be binding upon such party in accordance with the terms
hereof, and will not violate in any material respect any obligation by which
such party is bound, whether arising by contract, operation of law, or
otherwise. The Adviser acknowledges that it has received a copy of the
Subadviser's disclosure document under Rule 204-3 of the Investment Advisers
Act of 1940 at least 48 hours prior to executing this Agreement.
The Subadviser agrees to review written communications to Fund shareholders
and prospective investors relating to the Fund and the Subadviser's services
hereunder, including shareholder reports and proxy statements, as reasonably
requested by the Adviser. The Subadviser agrees to review the Fund's Prospectus
and the Statement of Additional Information as reasonably requested by the
Adviser to assure that the description therein of the investment policies and
strategies followed by the Subadviser in providing services hereunder for the
Fund is consistent with the policies and strategies the Subadviser uses or
intends to use and that the information therein concerning the Subadviser and
the services provided hereunder is accurate and complete.
The Subadviser agrees that during the term of this Agreement, including
renewals, and for a one year period following the termination of this
Agreement, the Subadviser will not, directly or indirectly, hire or attempt to
hire any present or former employees of the Adviser or solicit or encourage any
present employees of the Adviser to discontinue employment with the Adviser,
provided, however, that this prohibition shall bar the hiring of former
employees of the Adviser only during the first year following termination of
their employment with the Adviser.
B-4
8. Use of Names; References to the Subadviser. The Trustees of the Trust and
the Subadviser acknowledge that, in consideration of the Adviser's assumption
of organization and ongoing expenses of the Trust and of the Fund, the Adviser
has reserved for itself the right to the names "Green Century Funds", "Green
Century Balanced Fund", and "Green Century Equity Fund" (or any similar names)
and that use by the Trust of such names shall continue only with the continuing
consent of the Adviser, which consent may be withdrawn at any time, effective
immediately, upon written notice thereof to the Trust. The Subadviser hereby
agrees that the Adviser may use the Subadviser's name in the Fund's marketing
or advertising materials with the prior written consent of the Subadviser,
which consent will not be unreasonably withheld or delayed.
9. Assignment, Amendment of this Agreement. This Agreement may not be
transferred, assigned, sold or in any manner hypothecated or pledged by any
party hereto, except as permitted under the 1940 Act (including any exemptions
as may be granted by the SEC under the 1940 Act). 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, and no amendment of this
Agreement shall be effective, with respect to the Fund, until approved by vote
of the holders of a majority of the outstanding voting securities of the Fund,
if such shareholder approval is required by the 1940 Act subject, however, to
such exemptions as may be granted by the SEC under the 1940 Act.
10. Severability. If any provision of this Agreement shall be held or made
invalid by a decision, statute, rule or otherwise, the remainder of this
Agreement shall not be affected thereby.
11. Notices. Notices should be provided to the Subadviser at One Mellon
Center, Suite 4200, Pittsburgh, PA 15258-0001 Attention: William P. Rydell,
President and CEO. Notices to the Adviser should be provided to Ms. Kristina A.
Curtis, Green Century Capital Management, Inc., 114 State Street, Suite 200,
Boston, MA 02109. Notices to the Trust should be provided to Ms. Kristina
Curtis, Green Century Funds, 114 State Street, Suite 200, Boston, MA 02109.
12. Miscellaneous. Each party agrees to perform such further acts and to
execute further documents as are necessary to effectuate the acts and execute
such purposes hereof. The Agreement shall be construed and enforced in
accordance with and governed by the laws of the Commonwealth of Massachusetts,
provided, however, that nothing herein will be construed in a manner
inconsistent with the 1940 Act, the Investment Advisers Act of 1940, or any
rules and regulations of the SEC promulgated thereunder. Where the effect of a
requirement of the 1940 Act reflected in any provision of this Agreement is
altered by a rule, regulation or order of the SEC, whether of special or
general application, such provision shall be deemed to incorporate the effect
of such rule, regulation or order. The captions in this Agreement are included
for convenience only and in no way define or delimit any of the provisions
hereof or otherwise affect their construction or effect.
B-5
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed and delivered in their names and on their behalf by the undersigned,
thereunto duly authorized, all as of the day and year first above written.
Pursuant to the Trust's Declaration of Trust, dated as of July 1, 1991, the
obligations of this Agreement are not binding upon any of the Trustees or
shareholders of the Trust individually, but bind only the Trust estate.
GREEN CENTURY CAPITAL MANAGEMENT,
INC.
BY
-----------------------------
Wendy Wendlandt
President
MELLON EQUITY ASSOCIATES, LLP
BY
-----------------------------
William P. Rydell
President and Chief Executive
Officer
GREEN CENTURY FUNDS
BY
-----------------------------
Kristina A. Curtis
President
B-6
Voting Information
The enclosed proxy statement discusses important issues affecting your
investment in the Green Century Equity Fund. It is important that you vote as
soon as possible to save the expense of additional solicitations. If you
received more than one proxy card, you must vote each proxy card separately.
3 Ways To Vote:
. To vote on the Internet
1. Read the proxy statement.
2. Go to https://vote.proxy-
direct.com.
3. Follow the instructions on the
website.
Do not mail the below proxy
card.
. To vote by telephone
1. Read the proxy statement.
2. Call toll-free 1-866-241-6192.
3. Follow the recorded
instructions.
Do not mail the below proxy
card.
. To vote by mail
1. Read the proxy statement.
2. Mark your votes on the reverse
of the below proxy card.
3. Sign and date below.
4. Detach and return the proxy
card in the envelope provided.
If voting by mail, please detach at perforation before mailing.
[LOGO] GREEN CENTURY EQUITY FUND PROXY
GREEN CENTURY FUNDS
PROXY FOR A SPECIAL MEETING OF SHAREHOLDERS TO BE HELD NOVEMBER 6, 2006
SEPTEMBER 22, 2014
The undersigned, revoking prior proxies, hereby appoints Kristina A. Curtis and Amy F. Puffer, and each of them, proxies with several powers of substitution, to vote for the undersigned at the Special Meeting of Shareholders of the Green Century Balanced Fund and theGreen Century Equity Fund to be held at the offices of Green Century Capital Management, 114 State Street, Boston, MA 02109, on November 6, 2006,September 22, 2014, or at any adjournment or postponement thereof, upon the following matters as described in the Notice of Special Meeting and accompanying Proxy Statement, which have been received by the undersigned.
When properly executed, this proxy will be voted in the manner directed herein by the undersigned shareholder. All proposalsThe proposal on this proxy card havehas been proposed by the Green Century Funds Board of Trustees. If no direction is given on these proposals,the proposal, this proxy card will be voted "FOR" Proposals 1 and 2.“FOR” the Proposal. The proxy will be voted in accordance with the holder'sholder’s best judgment as to any other matters.
VOTE VIA THE INTERNET:
https://vote.proxy-direct.com
VOTE VIA TELEPHONE:
1-866-241-6192
OR VOTE VIA MAIL: Mark
your votes on reverse;matters as may come before the Special Meeting or any adjournments or postponements thereof.
If you choose to vote by mail and you are an individual account owner, please sign and
date below; return in enclosed
envelope
999 9999 9999 999
------------
Please sign this proxy exactly as your name or names appear.appears on the proxy card. Either owner of a joint account may sign the proxy card and the signer’s name must exactly match one of the names that appear on the card.
Please vote, sign where indicated and return promptly in enclosed envelope.
| Please sign this proxy exactly as your name appears. Either owner of a joint account may sign the proxy. Trustees and other fiduciaries should indicate the capacity in which they sign, and where more than one name appears, a majority must sign. If acorporation, this signature should be that of an authorized officer who should state his or her title. | Signature | |||||||
Date | ||||||||
GCF14 - PXY-V3
Important Notice Regarding the Availability of Proxy Materials for the
Special Meeting of Shareholders to Be Held on September 22, 2014
The Proxy Statement for this Meeting is available at:www.2voteproxy.com/gcf
¨Express Vote Option: To vote ALL accounts as the Board recommends for the proposal, mark the box at the left. No other vote is necessary.
| x | Please fill in the boxes as shown using black or blue ink or number 2 pencil. | |
| PLEASE DO NOT USE FINE POINT PENS. |
The Green Century Funds Board of Trustees recommends that you vote “FOR” the election of each of the nominees.
| 1. | To elect Trustees of the Green Century Funds. |
(01) | John Comerford | (05) | Bancroft R. Poor | |||||||
(02) | Jonathan Darnell | (06) | Mary Raftery | |||||||
(03) | Laurie Moskowitz | (07) | James H. Starr | |||||||
(04) | Douglas M. Phelps | (08) | Wendy Wendlandt |
| FOR | WITHHOLD | FOR ALL | FOR | WITHHOLD | FOR ALL | |||||||||||||
| ALL | ALL | EXCEPT | ALL | ALL | EXCEPT | |||||||||||||
Green Century Balanced Fund | ¨ | ¨ | ¨ | Green Century Equity Fund | ¨ | ¨ | ¨ | |||||||||||
To vote against a particular Nominee, mark the “FOR ALL EXCEPT” box and other fiduciaries should indicatewrite the capacity in which they sign,
and where more than one name
appears, a majority must sign. If a
corporation, this signature should
be thatnumber of an authorized officer
who should state his or her title.
-----------------------------------
Signature
-----------------------------------
Date 16893_GCE
EVERY SHAREHOLDER'S VOTE IS IMPORTANT
each Nominee you do not wish to vote for on the line(s) above
PLEASE VOTE, TODAY
If voting by mail, please detach at perforation before mailing.
PLEASE MARK VOTES AS IN THIS EXAMPLE:[_]
FOR AGAINST ABSTAIN
1. To approve an Investment Advisory Agreement with [ ] [ ] [ ]
Green Century Capital Management, Inc.
2. To approve an Investment Subadvisory Agreement [ ] [ ] [ ]
with Mellon Equity Associates, LLP
IF VOTING BY MAIL, BE SURE TO SIGN, WHERE INDICATED ON THE REVERSEDATE AND RETURN THIS PROXY CARD PROMPTLY INUSING THE ENCLOSED ENVELOPE.
16893_GCE