UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of
1934
(Amendment No. )
Filed by the Registrant [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 Under Rule 14a-12
Northeast Investors Growth Fund
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(Name of Registrant as Specified In Its Charter)
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(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
1) Title of each class of securities to which transaction applies:
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2) Aggregate number of securities to which transaction applies:
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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):
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[ ] 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:
1) Amount previously paid:
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2) Form, Schedule or Registration Statement No:
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4) Date Filed:
Northeast Investors Growth Fund
150 Federal Street
Boston, Massachusetts 2110
Dear Fellow Shareholder:
You are cordially invited to attend a special meeting (the "Special
Meeting") of the shareholders (the "Shareholders") of Northeast Investors Growth
Fund (the "Fund") to be held on Thursday, November 6, 2008 at 10:00a.m. local
time at the offices of the Fund, 10th Floor, 150 Federal Street, Boston,
MA 02110.
The principal purpose of the Special Meeting will be to vote on the
election of Trustees.
Whether or not you plan to attend the Special Meeting, your vote is
needed. Whether or not you plan to attend the Special Meeting, please
complete, sign, date and return the enclosed proxy card promptly or vote
either electronically or by telephone as soon as possible in accordance with
the instructions on the proxy card. Should you choose to vote by returning
the proxy by mail, a pre-addressed, postage-paid return envelope is
enclosed for your convenience. If you do vote electronically or by phone,
you do not need to mail your proxy card. However, if you want to later change
your vote, you may do so by attending the Special Meeting.
We look forward to seeing you at the Special Meeting or receiving
your proxy so your shares may be voted at the Special Meeting.
Sincerely yours,
William A. Oates, Jr.
President
Shareholders Are Urged to Sign and Return the Enclosed Proxy Card in
the Enclosed Envelope or to Vote either Electronically or by Telephone.
NORTHEAST INVESTORS GROWTH FUND
150 Federal Street
Boston, Massachusetts 02110
CALL AND NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
September 17, 2008
To the Shareholders:
Pursuant to the Agreement and Declaration of Trust of Northeast
Investors Growth Fund (the "Fund"), the Trustees hereby call and give notice of
a Special Meeting of the Shareholders to be held at the offices of the Fund,
10th Floor, 150 Federal Street, Boston, Massachusetts 02110, on Thursday,
November 6, 2008, at 10:00 a.m. local time, for the following purposes:
1. To elect Trustees; and
2. To transact such other business as may properly come before
the Special Meeting.
The foregoing matters may be acted upon at said Special Meeting or at any
adjournment thereof.
The Trustees have fixed the close of business on September 10, 2008,
as the time as of which Shareholders entitled to notice thereof and to vote at
the Special Meeting or any adjournment thereof shall be determined.
By Order of the Trustees
of Northeast Investors
Growth Fund
/s/ Robert B. Minturn
Robert B. Minturn, Clerk
WE NEED YOUR PROXY VOTE IMMEDIATELY
You may think your vote is not important, but it is vital. Pursuant
to the Fund's Declaration of Trust, the Special Meeting of the Shareholders of
the Fund scheduled for November 6, 2008 will have to be adjourned without
conducting any business if less than a majority of the shares eligible to vote
are represented at the Special Meeting. In that event, the Fund would continue
to solicit votes in an attempt to achieve a quorum. Whether you plan to attend
the Special Meeting or not, you are requested to complete, sign, date and return
the enclosed proxy card or to vote either electronically or by telephone as soon
as possible in accordance with the instructions on the proxy card. A
pre-addressed, postage-paid return envelope is enclosed for your convenience
should you choose to vote by returning the proxy via mail. Clearly, your vote
could be critical in allowing the Fund to accomplish its objectives, so please
return your proxy immediately.
NORTHEAST INVESTORS GROWTH FUND
150 Federal Street
Boston, Massachusetts 02110
PROXY STATEMENT
This proxy statement is furnished in connection with the solicitation
of proxies by the Trustees of the Fund. Each Shareholder of record at the close
of business on September 10, 2008 shall be entitled to one vote for each share
outstanding in such Shareholder's name. Such proxies are to be used at the
Special Meeting of the Shareholders to be held on November 6, 2008. This proxy
statement and the accompanying proxy card are first being mailed to Shareholders
on or about September 17, 2008.
It is expected that the solicitation of proxies will be primarily by
mail and telephone. The costs of the solicitation of proxies will be borne by
the Fund. The proxy solicitor is Broadridge Financial Solutions, Inc. and the
approximate cost is $ 8,000. The Fund will reimburse brokerage firms and others
for their reasonable expenses in forwarding solicitation material to the
beneficial owners of shares. The Fund's officers or the proxy solicitor may
assist in the solicitation of proxies by telephone, facsimile, personal
interview or the Internet. If the Fund or its solicitor records proxy votes
by telephone or the Internet, it will use procedures to authenticate
Shareholders' identities, to allow Shareholders to authorize the voting of their
shares in accordance with their instructions and to confirm that their
instructions have been properly recorded. Any Shareholder giving a proxy may
revoke it at any time before it is exercised by submitting to the Fund a written
notice of revocation or a subsequently executed Proxy Card or by attending the
Special Meeting and electing to vote in person. Proxies given by telephone or
the Internet may be revoked at any time before they are voted in the same manner
as proxies given by mail.
The following summarizes the proposal to be voted on at the Special
Meeting.
PROPOSAL
1. To elect each of:
William A. Oates, Jr.
John C. Emery
Michael Baldwin
F. Washington Jarvis
as Trustees of the Fund.
A Proxy Card is enclosed with respect to the shares you own in the
Fund. If the Proxy Card is executed and returned properly, the shares
represented by it will be voted at the Special Meeting in accordance with your
instructions. Each share is entitled to one vote.
The Shareholders are requested to complete the enclosed Proxy Card and
return it in the enclosed envelope. No postage is required if mailed in the
United States.
The Fund's Board of Trustees unanimously recommends a vote FOR the
Proposal described in this Proxy Statement.
Dated: September 17, 2008
INTRODUCTION
Northeast Investors Growth Fund (the "Fund") is a diversified, no-load,
open-end, management investment company registered under the Investment Company
Act of 1940, as amended. The Fund presently consists of one portfolio and is
organized as a placeStateMassachusetts business trust. The Special Meeting
constitutes a special meeting of Shareholders that has been called to consider
the proposal discussed below.
ELECTION OF TRUSTEES
The Trustees elected at the Special Meeting will serve until their
resignation or the appointment of their successors. In the absence of contrary
instructions, proxies will be voted for the election of the individuals named
above as Trustees. The nominees, Messrs. Oates, Emery, Baldwin and Jarvis are
incumbent Trustees. The nominees have consented to serve as Trustees.
The following table provides certain information about the nominees
for Trustee:
<table>
<s> <c> <c> <c> <c>
Name, Address Position(s) Held Length of Principal Occupation(s) During
and Age with Fund Time Served Last 5 Years/Other Directorships
Trustee who is an "Interested Person" of the Fund and Officer
William A. Oates, Jr. Trustee and President 27 years Trustee and President of Northeast
Age: 66 Investors Growth Fund; President
and Director of Northeast
Investment Management, Inc.;
President and Director of
Northeast Management &
Research Co., Inc.
Trustees who are not "Interested Persons" of the Fund:
Name, Address Position(s) Held Length of Principal Occupation(s) During
and Age with Fund Time Served Last 5 Years
John C. Emery Trustee 27 years Partner, Law Firm of Sullivan &
Age: 77 Worcester
Michael Baldwin Trustee 8 years Partner, Baldwin Brothers,
Age: 67 Registered Investment Advisor
F. Washington Jarvis Trustee 4 years Headmaster Emeritus at
Age: 69 Roxbury Latin School
</table>
MEETINGS OF THE BOARD
In the fiscal year of the Fund ended December 31, 2007, the Trustees
met four times. None of the Trustees attended fewer than 75% of the aggregate
amount of meetings of the Trustees and Trustee Committees for which they were
eligible to attend.
AUDIT COMMITTEE
The Trustees have an Audit Committee presently consisting of Messrs.
Emery, Baldwin and Jarvis. The Audit Committee assists the Board of Trustees
in fulfilling its responsibilities for the accounting and financial reporting
practices of the Fund and provides a channel of communication between the Board
of Trustees and the Fund's independent accountants. The provision of audit and
non-audit services by the Fund's independent accountants is subject to prior
approval by the Audit Committee. The Committee held four meetings during the
last fiscal year.
The Trustees do not have an Audit Committee Financial Expert as defined
under regulations of the Securities and Exchange Commission. Although the
members of the Fund's Audit Committee have a variety of business and investment
experience, none of them individually has been determined to meet the technical
qualifications required in order to meet the definition of an Audit Committee
Financial Expert. The Audit Committee, under its charter, has the ability to
retain independent advisers if it deems it necessary or appropriate without the
need to seek approval from the management of the Fund.
NOMINATING AND GOVERNANCE COMMITTEE
The Trustees also have a Nominating and Governance Committee presently
consisting of Messrs. Emery, Baldwin and Jarvis. This Committee during the
last fiscal year held three meetings, and considers recommendations made by
management or others for persons to serve as Trustee of the Fund. A current
copy of the Committee's Charter is available on the Northeast Investors website
(www.northeastinvestors.com) and is attached as Appendix 1 to this proxy
statement. The Committee has determined not to consider nominees to the Board
of Trustees recommended by Shareholders due to the expense and time commitment
which would be required.
SHARE OWNERSHIP
The following table shows the dollar range of shares of the Fund
beneficially owned by each nominee for Trustee.
Name of Trustee Dollar Range of Equity Securities
Trustee Who Is An "Interested Person" of the Fund
William A. Oates, Jr. Over $1,000,000
Trustees Who Are Not "Interested Persons" of the Fund
John C. Emery Between $10,001 - $50,000
Michael Baldwin Between $10,001 - $50,000
F. Washington Jarvis Over $100,000
The total number of shares owned beneficially by the Trustees, officers and
members of their immediate families on March 31, 2008 was 323,833.568 shares
(4.52%).
COMMUNICATIONS WITH THE TRUSTEES
Any Shareholder desiring to communicate with any of the Trustees may
send a letter to:
Board of Trustees
Northeast Investors Growth Fund
150 Federal Street
Boston, MA 02110
Attn: Clerk
CODE OF ETHICS
The Fund has adopted a Code of Ethics that applies to the Fund's
principal executive officer and principal financial officer. A copy of the
Code of Ethics is attached hereto as Appendix 2.
COMPENSATION OF TRUSTEES AND CERTAIN OFFICERS
Each Independent Trustee receives a $10,000 annual retainer. The total
Trustee fee paid to the Independent Trustees for each of the fiscal years ended
December 31, 2007 and December 31, 2006 was $30,000 and $30,000 respectively.
The aggregate compensation paid by the Fund to Gordon C. Barrett, the
Senior Vice President, Chief Compliance Officer and Chief Financial Officer for
the fiscal year ended December 31, 2007 was $97,000. As President of the Fund,
Mr. William A. Oates, Jr. received no compensation from the Fund. Mr. Oates
receives a salary from Northeast Management & Research Company, Inc. ("NMR"),
the Fund's investment adviser. He owns an equity interest in NMR. No
retirement benefits are provided by the Fund to any Trustee.
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
The firm of Ernst and Young LLP ("E&Y") has been selected as the
independent registered public accounting firm for the Fund.
The independent registered public accounting firm examines annual
financial statements for the Fund and provides other audit-related, non-audit,
and tax-related services to the Fund. Representatives of E&Y are expected to
be present at the Special Meeting, and will be available to respond to
Shareholder questions.
The Fund's Audit Committee must pre-approve all audit and non-audit
services provided by the independent registered public accounting firm relating
to the operations or financial reporting of the Fund. Prior to the commencement
of any audit or non-audit services to the Fund, the Audit Committee reviews the
services to determine whether they are appropriate and permissible under
applicable law.
The following information is provided with respect to fees charged the
Fund by its independent registered public accounting firm during the last two
fiscal years:
(a) Audit Fees. The aggregate fees billed for the Fund's fiscal
years ended December 31, 2007 and December 31, 2006 for professional services
rendered by the Fund's principal accountant for the audit of its annual
financial statements or services that are normally provided by such accountant
in connection with statutory and regulatory filings were $48,000 and $48,000
respectively.
(b) Audit-Related Fees. The aggregate fees billed for the Fund's
fiscal years ended December 31, 2007 and December 31, 2006 for assurance and
related services by the Fund's principal accountant reasonably related to the
performance of the audit of the Fund's financial statements and not reported
under Paragraph (a) were $19,500 and $19,500 respectively. Such services
consisted of a report of the Fund's transfer agent's internal controls pursuant
to rule 17AD-13, semi-annual report review and a report on the Fund's anti-money
laundering controls and policies.
(c) Tax Fees. The aggregate fees billed in the Fund's fiscal
years ended December 31, 2007 and December 31, 2006 for professional services
rendered by the Fund's principal accountant for tax matters were $8,000 and
$7,500 respectively. Such services consisted of the preparation of the Fund's
federal income and excise tax returns.
(d) All Other Fees. During the fiscal years ended December 31,
2007 and December 31, 2006 the aggregate fees billed for other services rendered
by the Fund's principal accountant were $16,731 and $34,963, respectively.
Such services consisted of a review and testing of registrant's compliance
policies and procedures pursuant to Rule 38a-1 under the Investment Company Act
of 1940, as amended.
VOTING INFORMATION
Record Date. Only Shareholders of record at the close of business on
September 10, 2008 will be entitled to vote at the Special Meeting. On that
date, the number of outstanding shares of the Fund was 6,947,820.063. All
shares of the Fund will vote in the aggregate.
You should send your proxy in by one of the following methods:
1. Complete, sign and return the enclosed Proxy Card promptly in
the postage-page envelope.
2. Call the toll-free number listed on the enclosed Proxy Card.
Enter the control number on the Proxy Card and follow the telephone
instructions.
3. Use the Internet at www.proxyvote.com. Enter the control
number of the enclosed Proxy Card and follow the instructions on the website.
Quorum. A quorum is constituted with respect to the Fund by the
presence in person or by proxy of the holders of more than 50% of the
outstanding shares entitled to vote. For purposes of determining the presence
of a quorum, abstentions and broker "non-votes" (that is, proxies from brokers
or nominees indicating that such persons have not received instructions from
the beneficial owners or other persons entitled to vote units on a particular
matter with respect to which the brokers or nominees do not have discretionary
power) will be treated as shares that are present at the Special Meeting but
which have not been voted.
In the event that a quorum is not present at the Special Meeting (or
at any adjournment thereof) or in the event that a quorum is present at the
Special Meeting but sufficient votes to approve any of the proposals are not
received, the persons named as proxies, or their substitutes, may propose and
vote for one or more adjournments of the Special Meeting to permit the further
solicitation of proxies. When voting on a proposal to adjourn the Special
Meeting, the proxy solicitor will consider whatever factors he or she deems
relevant, which factors may include: the nature of the proposal to be
adjourned, the percentage of votes actually cast, the percentage of negative
votes actually cast, the nature of any further solicitation and the information
to be provided to members in connection therewith. Any such adjournment will
require the affirmative vote of a majority of those shares that are represented
at the Special Meeting in person or by proxy. If a quorum is not present, all
proxies will be voted in favor of adjournment. However, if a quorum is present
at the Special Meeting but it appears that one or more proposals may not
receive Shareholder approval, the persons named as proxies may propose an
adjournment of the Special Meeting.
For an adjournment to occur, sufficient votes to adjourn must be voted
in favor of adjournment. The persons named as proxies will vote the following
shares in favor of adjournment:
o all shares for which they are entitled to vote in favor (i.e., "FOR")
any of the proposals that will be considered at the adjourned meeting;
and
o abstentions.
The persons named as proxies will vote the following shares against
adjournment:
o all shares for which they must vote "AGAINST" all proposals that will
be considered at an adjourned meeting.
SHAREHOLDER PROPOSALS
The Fund does not hold annual shareholder meetings. Shareholders
wishing to submit proposals for inclusion in a proxy statement for a subsequent
shareholder meeting should send their written proposals to the Clerk of the
Fund, 150 Federal Street, Boston, MA, 02110-1745.
NOTICE TO BANKS, BROKER-DEALERS AND
VOTING TRUSTEES AND THEIR NOMINEES
Please advise the Fund, at 150 Federal Street, Boston, MA 02110-1745,
whether other persons are beneficial owners of shares for which proxies are
being solicited and, if so, the number of copies of the Proxy Statement and
Annual Reports you wish to receive in order to supply copies to the beneficial
owners of the respective shares.
OTHER BUSINESS
There is no other business, so far as is now known to the Trustees, to
be acted upon at the Special Meeting. If any other business properly comes up
for action at the Special Meeting, the persons named in the enclosed Proxy Card
will vote thereon according to their best judgment in the interests of the Fund.
Shareholders may receive a copy of the Fund's Annual Report on Form
N-CSR for the fiscal year ended December 31, 2007(which includes a copy of the
Fund's Annual Report to Shareholders) without charge by submitting a request in
writing to Northeast Management & Research Company, Inc., 150 Federal Street,
Boston, MA 02110. All of these documents are also on file with the Securities
and Exchange Commission (the "SEC"). Shareholders may view or obtain these
documents from the SEC (i) in person; at the SEC's Public Reference Room in
Washington, D.C., (ii) by phone: 1-800-SEC-0330 (iii) by mail: Public
Reference Section, Securities and Exchange Commission, 450 5th Street, N.W.,
Washington, D.C. 20549, (duplicating fee required), (iv) by e-mail:
publicinfo@sec.gov, or (v) by Internet: www.sec.gov.
Only one proxy statement is being delivered to multiple Shareholders
sharing an address unless the Fund has received contrary instructions from one
or more of the Shareholders. The Fund will deliver promptly upon request a
separate copy of the proxy statement to a Shareholder at a shared address to
which a single copy of the documents was delivered. Shareholders can notify
the Fund that they would like to receive a separate copy of the proxy statement
by submitting a request in writing to the Clerk of the Fund at 150 Federal
Street, Boston, MA 02110, Attention Robert B. Minturn, or via telephone at
(617) 523-3588. Shareholders sharing an address and receiving multiple copies
of proxy statements may request to receive a single copy by contracting the
Fund as set forth above.
ADDITIONAL INFORMATION
Investment Adviser. Northeast Management & Research Company, Inc.
("NMR") which has its principal offices at 150 Federal Street, Boston, MA
02110 is a Massachusetts corporation and registered investment adviser. On
September 10, 2008, NMR had approximately $112,060,281 in aggregate assets
under management. The sole advisory client of NMR is the Fund.
Other. The Fund does not employ an external administrator or
underwriter.
EXECUTIVE OFFICERS
Officers of the Fund are appointed by the Trustees and hold office
until they resign, are removed or are otherwise disqualified to serve. The
following table sets forth certain information about the Fund's principal
executive officers:
<table>
<s> <c> <c> <c> <c>
Principal Occupation(s)/Other Directorships
Name/Age/Service Position During Past 5 Years
- -------------------------------------- ------------------------------ ---------------------------------------------
William A. Oates, Jr. President Trustee and President of Northeast
Age: 66 Investors Growth Fund; President and
Years of Service: 27 Director of Northeast Investment
Management, Inc.; President and Director of
Northeast Management & Research Co., Inc.
Gordon C. Barrett Senior Vice President, Chief Officer of Northeast Investors Trust,
Age: 51 Financial Officer and Chief Northeast Investors Growth Fund and
Years of Service: 14 Compliance Officer Northeast Investment Management, Inc.
Robert B. Minturn Vice President, Clerk and Officer of Northeast Investors Trust
Age: 69 Chief Legal Officer (Trustee until
Years of Service: 27 6/30/05); Officer
and Director of Northeast Investment
Management, Inc., Director of Northeast
Management & Research Co., Inc.
</table>
NORTHEAST INVESTORS GROWTH FUND
This Proxy is solicited by the Board of Trustees of Northeast Investors
Growth Fund (the "Fund").
This Proxy is solicited by the Board of the Fund for use at a Special
Meeting of shareholders to be held on November 6, 2008 at 10:00 a.m.
(Boston time), at the offices of the Fund, 10th Floor, 150 Federal Street,
Boston, Massachusetts 02110.
The undersigned hereby appoints Gordon C. Barrett and David A. Randall
and each of them, with full power of substitution, as proxies of the undersigned
to vote at the above-stated Special Meeting, and at all adjournments or
postponements thereof, all shares representing interests in the Fund held of
record by the undersigned on September 10, 2008, the record date for the Special
Meeting, upon the following matters and upon any other matter that may come
before the Special Meeting, in their discretion.
Every properly signed proxy will be voted in the manner specified
thereon and, in the absence of specification, will be treated as GRANTING
authority to vote FOR each nominee for Trustee.
The proxies are authorized in their discretion to vote on any other
business which may properly come before the Special Meeting and any adjournments
thereof. The proxies shall vote on adjournment in the manner contemplated by
the Proxy Statement.
Please sign exactly as name appears hereon. When shares are held by
joint tenants, both should sign. When signing as attorney or executor,
administrator, trustee or guardian, please give full title as such. If a
corporation, please sign in full corporate name by president or other authorized
officer. If a partnership, please sign in partnership name by authorized
person.
To vote by Telephone
1. Read the Proxy Statement and have the Proxy Card below at hand.
2. Call [1-800-690-6903].
3. Enter the 12-digit control number set forth on the Proxy Card and
follow the simple instructions.
To vote by Internet
1. Read the Proxy Statement and have the Proxy Card below at hand.
2. Go to Website www.proxyvote.com.
3. Enter the 12-digit control number set forth on the Proxy Card and
follow the simple instructions.
Please sign and return promptly in enclosed envelope. No postage is required.
To Vote, Mark Blocks Below in Blue or Black Ink as Follows: X
Keep This Portion For Your Records
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Detach And Return This Portion Only.
This Proxy Card Is Valid Only When Signed And Dated.
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NORTHEAST INVESTORS GROWTH FUND
[Control Number]
1. Vote On Trustees
01) William A. Oates, Jr. 02) John C. Emery
03) Michael Baldwin 04) F. Washington Jarvis
For Withhold For All
All All Except
[__] [__] [__]
To withhold authority to vote, mark "For All Except" and write the nominee's
number on the line
APPENDIX 1
NOMINATING AND GOVERNANCE COMMITTEE CHARTER
I. Purpose
The Nominating and Governance Committee (the "Committee") shall be
appointed by the Board of Trustees (the "Board" or "Board of Trustees")
of Northeast Investors Growth Fund (the "Fund") to:
A. Identify individuals qualified to become trustees and
recommend to the Board the candidates for all trusteeships to
be filled by the Board of Trustees or by the shareholders;
B. Recommend to the Board of Trustees candidates for membership
on Board committees;
C. Develop and recommend to the Board guidelines for effective
corporate governance; and
D. Lead the Board of Trustees in its annual review of the Board's
performance.
II. Membership
The Committee's membership is determined by the Board of Trustees and
shall consist of at least three (3) Board members, each of whom meet
the criteria for independence contained in the rules of the New York
Stock Exchange and any other applicable regulations. The Board shall
appoint the Chair of the Committee. The Chair will preside at all
sessions of the Committee at which he or she is present and will set
the agendas for Committee meetings.
III. Meetings and Reports
The Committee shall meet as frequently as circumstances dictate. The
Chair of the Committee, or any two members of the Committee, may call
meetings of the Committee. All meetings of the Committee may be held
telephonically. All members of the Board of Trustees are free to
suggest items for inclusion in the agenda for the Committee's meetings.
The agenda and information concerning the business to be conducted at
each Committee meeting shall, to the extent practical, be communicated
to the members of the Committee sufficiently in advance of each meeting
to permit meaningful review.
The Committee shall report regularly to the Board (i) following
meetings of the Committee, (ii) with respect to such other matters
that are within the Committee's responsibilities and (iii) with
respect to such recommendations as the Committee may deem appropriate.
The report to the Board may take the form of an oral report by the
Chair or any other member of the Committee designated by the Committee
to make such report. The Committee shall maintain minutes or other
records of meetings and activities of the Committee.
IV. Authority
The Committee shall perform the following functions related to the
purposes of the Committee outlined in Section I of this Charter. The
Committee may carry out additional functions and adopt additional
policies and procedures as may be appropriate in light of changing
business, legislative, regulatory, legal or other conditions. The
Committee shall also carry out any other responsibilities and duties
delegated to it by the Board of Trustees from time to time related to
the purposes of the Committee outlined in Section I of this Charter.
A. Board Selection, Composition and Evaluation
1. Establish criteria for the selection of new trustees to serve on the
Board of Trustees.
2. Identify individuals believed to be qualified as candidates to serve
on the Board of Trustees, conduct all necessary and appropriate inquiries into
the backgrounds and qualifications of such candidates and recommend that the
Board select the candidates for all trusteeships to be filled by the Board of
Trustees or by the shareholders from such identified individuals.
3. Review and make recommendations to the Board as to whether members of
the Board should stand for re-election. As part of such review, the Committee
will review each non-employee trustee against the independence standards on an
annual basis and recommend to the Board whether to make an independence
determination with respect to each such trustee.
4. Review and make recommendations, as the Committee deems appropriate,
regarding the composition and size of the Board of Trustees in order to ensure
the Board has the requisite expertise and its membership consists of persons
with sufficiently diverse and independent backgrounds. Consider matters relating
to the Fund's trustee retirement policy.
B. Committee Selection, Composition and Evaluation
1. Establish, monitor and recommend the purpose, structure and operations
of the various committees of the Board, the qualifications and criteria for
membership on each committee of the Board and, as circumstances dictate or the
Committee otherwise deems appropriate, make any recommendations regarding
periodic rotation of trustees among the committees.
2. Recommend members of the Board of Trustees to serve on the committees
of the Board, giving consideration to the criteria for service on each committee
as set forth in the charter for each such committee, and, where appropriate,
make recommendations regarding the removal of any member of any committee.
3. Recommend members of the Board of Trustees to serve as the Chair of the
committees of the Board.
4. Evaluate whether the necessary and appropriate committees exist to
support the work of the Board and make recommendations to the Board of Trustees
for the creation of additional committees or the elimination of Board
committees as appropriate.
5. Periodically review the charter of each committee of the Board and
propose modifications to the applicable Committee for consideration as
appropriate.
C. Corporate Governance
1. Oversee compliance with the Fund's Governance Guidelines, monitor
developments in governance, review the Governance Guidelines periodically and
propose modifications to the Guidelines to the Board of Trustees for
consideration as appropriate.
2. The Fund has adopted Code of Ethics for Trustees, Officers and
Employees. The Committee will periodically review the Guidelines and propose
modifications to the Code to the Board of Trustees for consideration as
appropriate.
D. Retention of Outside Advisers
1. The Committee has the authority to retain counsel, consultants or other
outside advisers, with respect to any issue without consulting or obtaining the
approval of any officer of the Fund in advance.
2. The Committee shall have sole authority to retain and terminate any
search firm to be used to assist in identifying Board candidates, including the
sole authority to approve the search firm's fee and other retention terms.
E. Annual Evaluations
1. Lead the Board of Trustees in an annual self-evaluation process to
determine whether the Board and its committees are functioning effectively.
Receive comments from the Board members and summarize and report annually to the
Board of Trustees an assessment of the Board's performance. The assessment
should focus on the Board's contribution to the Fund and emphasize those areas
in which the Board believes a better contribution could be made. The
Committee will establish the criteria to be used in such evaluations.
2. Review each non-employee trustee against the independence standards on
an annual basis and recommend to the Board whether to make an independence
determination with respect to each such trustee.
3. Perform an annual review and evaluation of the Committee's performance,
including a review of the Committee's compliance with this Charter. The
Committee shall conduct such evaluation and review in such manner as it deems
appropriate and report the results of the evaluation to the entire Board of
Trustees.
F. Evaluations as needed
1. Assess the skills and characteristics of the Board of Trustees and the
composition of the Board as a whole, as needed. This assessment should include
an analysis of the Board's core competencies, including understanding of the
financial industry, financial expertise, integrity, wisdom, judgment, commitment
to excellence, business experience and acumen, skills, diverse perspectives and
availability. As a result of this assessment, the Committee will determine
whether the effectiveness of the Board could be enhanced by a change in its
membership and the addition of new trustees with other skills and experience.
APPENDIX 2
NORTHEAST INVESTORS GROWTH FUND
CODE OF ETHICS FOR PRINCIPAL EXECUTIVE AND
SENIOR FINANCIAL OFFICERS
I. Covered Officers/Purpose of the Code
This code of ethics (this "Code") of Northeast Investors Growth Fund
(the "Fund") applies to the Fund's Principal Executive Officer, Principal
Financial Officer and Principal Accounting Officer (the "Covered Officers") for
the purpose of promoting:
o honest and ethical conduct, including the ethical handling of actual
or apparent conflicts of interest between personal and professional
relationships;
o full, fair, accurate, timely and understandable disclosure in reports
and documents that the Fund files with, or submits to, the Securities and
Exchange Commission ("SEC") and in other public communications made by the Fund;
o compliance with applicable laws and governmental rules and regulations;
o the prompt internal reporting of violations of the Code to the Fund's
Compliance Officer, Gordon C. Barrett; and
o accountability for adherence to the Code.
Each Covered Officer should adhere to a high standard of business
ethics and should be sensitive to situations that may give rise to actual as
well as apparent conflicts of interest.
II. Covered Officers Should Handle Ethically Actual and Apparent Conflicts
of Interest
Overview. A "conflict of interest" occurs when a Covered Officer's
private interest interferes with the interests of, or his service to, the Fund.
For example, a conflict of interest would arise if a Covered Officer, or a
member of his family, receives improper personal benefits as a result of his
position with the Fund.
Certain conflicts of interest arise out of the relationships between
Covered Officers and the Fund and already are subject to conflict of interest
provisions in the Investment Company Act of 1940 ("Investment Company Act") and
the Investment Advisers Act of 1940 ("Investment Advisers Act"). For example,
Covered Officers may not individually engage in certain transactions (such as
the purchase or sale of securities or other property) with the Fund because of
their status as "affiliated persons" of the Fund. The Fund's compliance
procedures are designed to prevent, or identify and correct, violations of
these provisions. This Code does not, and is not intended to, repeat or replace
these procedures, and such conflicts fall outside of the parameters of this
Code.
Although typically not presenting an opportunity for improper personal
benefit, conflicts arise from, or as a result of, the contractual relationship
between the Fund and its investment adviser, of which the Covered Officers may
also be officers or employees. As a result, this Code recognizes that the
Covered Officers will, in the normal course of their duties (whether formally
for the Fund or for the adviser, or for both), be involved in establishing
policies and implementing decisions that will have different effects on the
adviser and the Fund. The participation of the Covered Officers in such
activities is inherent in the contractual relationship between the Fund and the
adviser and is consistent with the performance by the Covered Officers of their
duties as officers of the Fund. Thus, if performed in conformity with the
provisions of the Investment Company Act and the Investment Advisers Act, such
activities will be deemed to have been handled ethically. In addition, it is
recognized that the Covered Officers may also be officers or employees of one or
more other investment companies covered by this or other codes.
Other conflicts of interest are covered by the Code, even if such
conflicts of interest are not subject to provisions in the Investment Company
Act and the Investment Advisers Act. The following list provides examples of
conflicts of interest under the Code, but Covered Officers should keep in mind
that these examples are not exhaustive. The overarching principle is that the
personal interest of a Covered Officer should not be placed improperly before
the interest of the Fund.
Each Covered Officer must:
o not use his personal influence or personal relationships improperly to
influence investment decisions or financial reporting by the Fund whereby the
Covered Officer would benefit personally to the detriment of the Fund;
o not cause the Fund to take action, or fail to take action, for the
individual personal benefit of the Covered Officer rather than the benefit the
Fund;
o not use material non-public knowledge of portfolio transactions made
or contemplated for the Fund to trade personally or cause others to trade
personally in contemplation of the market effect of such transactions;
There are some conflict of interest situations that may be discussed
with the Fund's Compliance Officer, if material. Examples of these include:
o service as a director on the board of any public company;
o the receipt of any entertainment from any company with which the Fund
has current or prospective business dealings unless such entertainment is
business-related, reasonable in cost, appropriate as to time and place, and not
so frequent as to raise any question of impropriety;
o any ownership interest in, or any consulting or employment relationship
with, any of the Fund's service providers, other than its investment adviser or
any affiliated person thereof;
o a direct or indirect financial interest in commissions, transaction
charges or spreads paid by the Fund for effecting portfolio transactions or for
selling or redeeming shares other than an interest arising from the Covered
Officer's employment, such as compensation or equity ownership.
III. Disclosure and Compliance
o Each Covered Officer should familiarize himself with the disclosure
requirements generally applicable to the Fund;
o each Covered Officer should not knowingly misrepresent, or cause others
to misrepresent, facts about the Fund to others, whether within or outside the
Fund, including to the Fund's trustees and auditors, and to governmental
regulators and self-regulatory organizations;
o each Covered Officer should, to the extent appropriate within his area
of responsibility, consult with other officers and employees of the Fund and the
adviser with the goal of promoting full, fair, accurate, timely and
understandable disclosure in the reports and documents the Fund files with, or
submits to, the SEC and in other public communications made by the Fund; and
o it is the responsibility of each Covered Officer to promote compliance
with the standards and restrictions imposed by applicable laws, rules and
regulations.
IV. Reporting and Accountability
Each Covered Officer must:
o upon adoption of the Code (or thereafter as applicable, upon becoming a
Covered Officer), affirm in writing that he has received, read, and understands
the Code;
o not retaliate against any other Covered Officer or any employee of the
Fund or their affiliated persons for reports of potential violations that are
made in good faith; and
o notify the Compliance Officer promptly if he knows of any violation of
this Code. Failure to do so is itself a violation of this Code.
The Compliance Officer is responsible for applying this Code to
specific situations in which questions are presented under it and has the
authority to interpret this Code in any particular situation. However, any
approvals or waivers sought by the Principal Executive Officer will be
considered by the Fund's Board of Trustees (the "Board").
The Fund will follow these procedures in investigating and enforcing
this Code:
o the Compliance Officer will take all appropriate action to investigate
any potential violations reported to him;
o if, after such investigation, the Compliance Officer believes that no
violation has occurred, the Compliance Officer is not required to take any
further action;
o any matter that the Compliance Officer believes is a violation will be
reported to the Board;
o if the Board concurs that a violation has occurred, it will consider
appropriate action, which may include review of, and appropriate modifications
to, applicable policies and procedures; notification to appropriate personnel of
the investment adviser or its board; or a recommendation to dismiss or otherwise
discipline the Covered Officer; and
o any changes to or waivers of this Code will, to the extent required, be
disclosed as provided by SEC rules.
V. Other Policies and Procedures
This Code shall be the sole code of ethics adopted by the Fund for
purposes of Section 406 of the Sarbanes-Oxley Act and the rules and forms
applicable to registered investment companies thereunder. Insofar as other
policies or procedures of the Fund, or the Fund's adviser, govern or purport to
govern the behavior or activities of the Covered Officers who are subject to
this Code, they are superseded by this Code to the extent that they overlap or
conflict with the provisions of this Code. The Fund's and its investment
adviser's codes of ethics under Rule 17j-1 under the Investment Company Act are
separate requirements applying to the Covered Officers and others, and are not
part of this Code.
VI. Amendments
Any amendments to this Code, other than amendments to Exhibit A, must
be approved or ratified by a majority vote of the Board, including a majority
of independent trustees.
VII. Confidentiality
All reports and records prepared or maintained pursuant to this Code will be
considered confidential and shall be maintained and protected accordingly.
Except as otherwise required by law or this Code, such matters shall not
be disclosed to anyone other than the Board, the Fund, its adviser and counsel
to any of them.
VIII. Internal Use
The Code is intended solely for the internal use by the Fund and does
not constitute an admission, by or on behalf of the Fund, as to any fact,
circumstance, or legal conclusion.