SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934
Filed by the Registrant [ ] Filed by a Party other than the Registrant
[ X ]
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 Sec. 240.14a-11(c) or
Sec. 240.14a-12
DG Investor Series
(Name of Registrant as Specified In Its Charter)
Federated Investors
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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)(4) 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 proxy 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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3) Filing Party:
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4) Date Filed:
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DG INVESTOR SERIES
DG OPPORTUNITY FUND
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
TO BE HELD JULY 21, 1997
A special meeting of the shareholders of DG Opportunity Fund
(the "Fund"), a portfolio of DG Investor Series (the "Trust"), will be
held at Federated Investors Tower, 1001 Liberty Avenue, Pittsburgh,
Pennsylvania 15222-3779, at 3:00 p.m. (Eastern time), on July 21,
1997, for the following purposes:
(1) To approve or disapprove a Sub-Advisory Agreement and exhibits
thereto, between the Fund's investment adviser, ParkSouth
Corporation ("ParkSouth") and Womack Asset Management, Inc.
("Sub-Adviser"), on behalf of the Fund;
(2) To transact such other business as may properly come before the
meeting or any adjournment thereof.
The Board of Trustees has fixed June 19, 1997, as the record
date for determination of shareholders entitled to vote at the
meeting.
By Order of the Trustees
John W. McGonigle
Secretary
June 30, 1997
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SIGN, DATE AND RETURN THE ENCLOSED PROXY PROMPTLY TO AVOID ADDITIONAL
EXPENSE.
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YOU CAN HELP THE TRUST AVOID THE NECESSITY AND
EXPENSE OF SENDING FOLLOW-UP LETTERS TO ENSURE A
QUORUM BY PROMPTLY RETURNING THE ENCLOSED PROXY. IF
YOU ARE UNABLE TO ATTEND THE MEETING, PLEASE MARK,
SIGN, DATE AND RETURN THE ENCLOSED PROXY SO THAT THE
NECESSARY QUORUM MAY BE REPRESENTED AT THE SPECIAL
MEETING. THE ENCLOSED ENVELOPE REQUIRES NO POSTAGE
IF MAILED IN THE UNITED STATES.
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DG INVESTOR SERIES
Federated Investors Tower
Pittsburgh, PA 15222-3779
PROXY STATEMENT
The enclosed proxy is solicited on behalf of the Board of
Trustees of DG Investor Series (the "Trust") with respect to DG
Opportunity Fund (the "Fund"). The proxies will be voted at the
special meeting of shareholders of the Fund to be held on July 21,
1997, at the offices of the Trust, Federated Investors Tower,
Pittsburgh, Pennsylvania 15222-3779 (such special meeting and any
adjournment or postponement thereof are referred to as the "Special
Meeting"). The proxy is revocable at any time before it is voted by
sending written notice of the revocation to the Trust or by appearing
personally at the Special Meeting.
The cost of preparing and mailing the notice of meeting, this proxy
statement, proxy card and any additional proxy material has been or is
to be borne by the Trust. Proxy solicitations will be made primarily
by mail, but may also be made by telephone, telegraph, or personal
interview conducted by certain officers or employees of the Trust, of
Federated Shareholder Services Company (the Trust's transfer agent) or
of Federated Administrative Services (the Trust's administrator). In
the event that a shareholder signs, dates, and returns the proxy
ballot but does not indicate a choice as to an item on the proxy
ballot, the proxy attorneys will vote those shares in favor of such
proposal.
The purposes of the Special Meeting are set forth in the accompanying
Notice of Special Meeting of Shareholders. The Trustees know of no
business other than that mentioned in the Notice that will be
presented for consideration at the Special Meeting. Should other
business properly be brought before the Special Meeting, proxies will
be voted in accordance with the best judgment of the persons named as
proxies. This Proxy Statement and the enclosed proxy card are expected
to be mailed on or about June 30, 1997, to shareholders of record at
the close of business on June 19, 1997 (the "Record Date").
Only shareholders of record on the Record Date will be entitled to
vote at the Special Meeting. On the Record Date, the Fund had
outstanding 6,156,191.68 shares of beneficial interest. A majority of
the outstanding shares of the Fund, represented in person or by proxy,
shall be required to constitute a quorum at the Special Meeting for
the purpose of voting on the proposals offered.
Each share of the Fund is entitled to one vote, and fractional shares
are entitled to proportionate shares of one vote. At the close of
business on June 19, 1997, the following persons owned, to the
knowledge of management, 5% or more of the outstanding shares of the
Fund: Deposit Guaranty National Bank ("DGNB"), Jackson, Mississippi,
acting in various capacities for numerous accounts, was owner of
record of 4,950,200 shares (80.46%); Commercial National Bank,
Shreveport, Louisiana, acting in various capacities for numerous
accounts, was owner of record of 403,634 shares (6.56%).
The favorable vote of a majority, as defined in the Investment Company
Act of 1940 (the "1940 Act"), of the outstanding voting securities of
the Fund is required for approval of the proposal to approve a new
Sub-Advisory Agreement between ParkSouth and Sub-Adviser on behalf of
the Fund. The vote of shareholders of a majority (as so defined in the
1940 Act) of outstanding securities means (a) the vote of the holders
of 67% or more of the shares present at the meeting, if the holders of
50% or more of the outstanding voting securities of the Fund are
present or represented by proxy, or (b) the vote of the holders of
more than 50% of the outstanding shares, whichever is less.
For purposes of determining the presence of a quorum and counting
votes on the matters presented, shares represented by abstentions and
"broker non-votes" will be counted as present, but not as votes cast,
at the Special Meeting. Under the Trust's Declaration of Trust, the
vote will be determined on the basis of a percentage of votes cast at
the Special Meeting. Under the Investment Company Act of 1940 (the
"1940 Act"), the affirmative vote necessary to approve a new
Sub-Advisory Agreement between the Trust and the Sub-Adviser on behalf
of the Fund may be determined with reference to a percentage of votes
present at the Special Meeting, which would have the effect of
treating abstentions and non-votes as if they were votes against the
proposal.
The Trust will furnish, without charge, a copy of the annual
report, which includes audited financial statements for the fiscal
year ended February 28, 1997, to any shareholder of record upon
request. The Trust's principal executive offices are located at
Federated Investors Tower, Pittsburgh, Pennsylvania 15222-3779. The
Trustees propose to mail this proxy statement and the enclosed Notice
of meeting and proxy card on or about June 30, 1997.
SUB-ADVISORY AGREEMENT
TERMS OF THE SUB-ADVISORY AGREEMENT
A copy of the Sub-Advisory Agreement is attached hereto as
Exhibit 1.
Pursuant to the terms of the proposed investment sub-advisory
Agreement between the Fund's investment adviser, ParkSouth, and the
Sub-Adviser, the Sub-Adviser would act as a discretionary sub-adviser
to the Fund for all assets of the Fund other than cash and
cash-equivalents. Under the terms of the Sub-Advisory Agreement, the
Sub-Adviser will make all determinations with respect to the
investment of non-cash assets of the Fund, and shall take such steps
as may be necessary to implement the same, including the placement of
purchase and sale orders on behalf of the Fund.
The Sub-Advisory Agreement provides that the Sub-Adviser
shall pay all expenses incurred by it and its staff in connection with
the performance of its services under the Sub-Advisory Agreement,
including the payment of salaries of all officers and employees who
are employed by it. ParkSouth will pay the Sub-Adviser an annual fee
determined by applying the following annual rates to the Fund's
aggregate daily net assets: .32% of the Fund's assets up to the first
$50 million; .075% of the Fund's net assets in excess of $50 million
but less than $70 million; plus .25% of the Fund's net assets in
excess of $70 million. Applying the foregoing formula to the Fund's
current level of net assets, the Sub-Adviser would currently be
entitled to a sub-advisory fee equal to .25% of the Fund's average
daily net assets, payable by ParkSouth from ParkSouth's investment
advisory fee of .95% of the Fund's average daily net assets.
The Sub-Advisory Agreement provides with respect to the Fund
that, if approved by shareholders of the Fund, it will remain in
effect for an initial term of two years from the date of its execution
and shall continue in effect for successive one-year periods, provided
such continuance is specifically approved at least annually by vote of
a majority of Trustees, including a majority of the independent
Trustees, cast in person at a meeting called for the purpose of voting
on such approval. The Sub-Advisory Agreement may be terminated by the
Trustees at any time without penalty, or by a vote of a majority of
the outstanding voting securities of the Fund on 60 days' written
notice. The Sub-Advisory Agreement will immediately terminate in the
event of its assignment (as such term is defined in the 1940 Act) or
in the event of the termination of the Trust's advisory Agreement with
ParkSouth.
The Trustees have reviewed and unanimously approved the terms
of the Sub-Advisory Agreement and directed that it be submitted to the
Fund's shareholders for their approval. In the event that the
Sub-Advisory Agreement is not approved by the Fund's shareholders,
ParkSouth would be solely responsible for providing investment advice
to the Fund, and the Trustees will consider what action, if any,
should be taken, including, but not limited to, requesting that the
Sub-Adviser perform sub-advisory services at cost until a new
sub-advisory Agreement is approved by the Fund's shareholders.
INFORMATION REGARDING THE SUB-ADVISER, WOMACK ASSET MANAGEMENT, INC.
The Sub-Adviser, Womack Asset Management, Inc., based in
Jackson, Mississippi, is a registered investment adviser formed in
1997 by William A. Womack. Mr. Womack, until February 1997, had been
Senior Vice President and Trust Investment Officer of DGNB (the parent
corporation of ParkSouth, and, until March 1, 1997, the investment
adviser to the Fund), and the portfolio manager for the Fund. In
February 1997, Mr. Womack left DGNB in order to establish and operate
the Sub-Adviser.
Because of the outstanding performance record achieved by the
Fund during Mr. Womack's tenure, and because of Mr. Womack's high
standing with the Fund's shareholders, ParkSouth has determined that
it is in the Fund's best interest to continue to use Mr. Womack's
expertise in the management of the Fund, and this would be
accomplished through the proposed sub-advisory relationship.
It is contemplated that Mr. Womack will, at least initially,
be the sole employee and sole shareholder of the Sub-Adviser.
ParkSouth believes that adequate portfolio management back-up is in
place if Mr. Womack were unable, temporarily or permanently, to devote
his attention to the Fund's management. Specifically, ParkSouth has a
team of investment professionals, led by Gerald White, available to
assume full day-to-day responsibility for all tasks and duties
associated with serving as adviser to the Fund.
BOARD OF TRUSTEES' RECOMMENDATION
Based on their consideration, analysis and evaluation of the
above factors and other information deemed by them to be relevant to
the proposed Sub-Advisory Agreement, the Trustees (including the
Trustees who are not "interested persons" as defined in the 1940 Act)
have concluded that it would be in the best interests of the Fund and
its shareholders to approve the proposed Sub-Advisory Agreement on
behalf of the Fund.
THE BOARD OF TRUSTEES OF THE TRUST RECOMMENDS APPROVAL BY
SHAREHOLDERS OF THE FUND OF THE SUB-ADVISORY AGREEMENT
BETWEEN PARKSOUTH AND THE SUB-ADVISER, WOMACK ASSET
MANAGEMENT, INC.
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OTHER MATTERS AND DISCRETION OF ATTORNEYS NAMED IN THE PROXY
The Trust is not required, and does not intend, to hold
annual meetings of shareholders. Shareholders wishing to submit
proposals for consideration for inclusion in a proxy statement for the
next meeting of shareholders should send their written proposals to DG
Investor Series, Federated Investors Tower, Pittsburgh, Pennsylvania
15222-3779, so that they are received within a reasonable time before
any such meeting.
No business other than the matter described above is expected
to come before the Special Meeting, but should any other matter
requiring a vote of shareholders arise, including any question as to
an adjournment or postponement of the Special Meeting, the persons
named on the enclosed proxy card will vote on such matters according
to their best judgment in the interests of the Fund.
PROXIES, QUORUM AND VOTING AT THE SPECIAL MEETING
Any person giving a proxy has the power to revoke it any time
prior to its exercise by executing a superseding proxy or by
submitting a written notice of revocation to the Secretary of the
Trust. In addition, although mere attendance at the Special Meeting
will not revoke a proxy, a shareholder present at the Special Meeting
may withdraw his or her proxy and vote in person. All properly
executed and unrevoked proxies received in time for the Special
Meeting will be voted in accordance with the instructions contained in
the proxies. If no instruction is given, the persons named as proxies
will vote the shares represented thereby in favor of the matters set
forth in the attached Notice.
In the event that, at the time any session of the Special
Meeting is called to order, a quorum is not present at the Special
Meeting, 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 may propose one or more
adjournments of the Special Meeting (with respect to all or some of
the proposals) to permit further solicitation of proxies. Any such
adjournment will require the affirmative vote of a majority of those
shares affected by the adjournment represented at the Special Meeting
in person or by proxy. If a quorum is present, the persons named as
proxies will vote those proxies which they are entitled to vote FOR
all such proposals in favor of such an adjournment, and will vote
those proxies required to be voted AGAINST any such proposal against
any adjournment. A shareholder vote may be taken on one or more of the
proposals in this Proxy Statement prior to any such adjournment if
sufficient votes have been received for approval. Under the
Declaration of Trust of the Trust, a quorum is constituted by the
presence in person or by proxy of the holders of a majority of the
issued and outstanding shares of the Fund entitled to vote at the
Special Meeting.
SHAREHOLDERSARE REQUESTED TO COMPLETE, DATE AND SIGN THE
ENCLOSED PROXY CARD AND RETURN IT IN THE ENCLOSED
ENVELOPE, WHICH NEEDS NO POSTAGE IF MAILED IN THE
UNITED STATES.
By Order of the Trustees
JOHN W. McGONIGLE
Secretary
June 30, 1997
Cusip 23321N400
GO1258-10(6/97)
EXHIBIT 1
DG INVESTOR SERIES
SUB-ADVISORY AGREEMENT
THIS INVESTMENT SUB-ADVISORY AGREEMENT (the "Agreement") is
made and entered into as of ___ day of ____________, 1997 by and
between ParkSouth Corporation (the "Adviser") and Womack Asset
Management (the "Sub-Adviser").
PRELIMINARY STATEMENTS
A. DG Investor Series, a Massachusetts business trust (the
"Trust"), is an open-end management company as defined in the
Investment Company Act of 1940 and is registered as such with the
Securities and Exchange Commission.
B. The Adviser has been retained by the Trust under the
Investment Advisory Contract dated as of March 31, 1997 (the
"Contract") to act as investment adviser with respect to each of the
Trust's investment portfolios, including the DG Opportunity Fund (the
"Fund").
C. The Adviser is authorized under the Contract to "contract with
such other person, persons, corporation, or corporations as its own
cost and expense as it shall determine in order to assist it in
carrying out this Contract."
D. The Adviser wishes to retain the Sub-Adviser to provide, and
the Sub-Adviser wishes to render, portfolio management services for
the Fund, all upon the terms and conditions set forth in this
Agreement.
NOW, THEREFORE, in consideration of the mutual promises and
the covenants herein contained, the Adviser and the Sub-Adviser agree
as follows:
1. APPOINTMENT. The Adviser hereby appoints the Sub-Adviser to act as
a discretionary sub-adviser to the Fund for all assets of the Fund
other than cash and cash equivalents. The Sub-Adviser hereby accepts
the appointment and agrees to use its best professional judgement to
make and implement investment decisions for the Fund in accordance
with the provisions of this Agreement.
2. DUTIES OF THE SUB-ADVISER
(a) Subject to the direction and control of the Adviser and
the Board of Trustees of the Trust, the Sub-Adviser shall be
responsible for the management of the investment operations of the
Fund and the determination of what portion of the Fund's assets will
be held in cash and cash equivalents and what portion will be invested
in equity securities and other assets. Any cash and cash equivalents
in the Fund shall be managed by the Adviser. The Sub-Adviser is hereby
authorized to select portfolio securities for investment, to determine
whether to purchase and sell securities for the Fund, and upon making
any purchase or sale decision for the Fund, to place orders for the
execution of such portfolio transactions in accordance with Section 4
of this Agreement and any operational procedures that may be specified
by the Adviser from time to time ("Operational Procedures"). The
Sub-Adviser shall consult with the Adviser upon the Adviser's
reasonable request with respect to any investment decision made by it
for the Fund and assist the Adviser and the Trust's officers in
connection with the operation of the Fund and perform any further acts
that may be necessary to effectuate the purposes of this Agreement.
(b) In providing portfolio management services to the Fund,
the Sub-Adviser shall be subject to such investment restrictions as
are set forth in the Investment Company Act of 1940 and rules
thereunder; the Internal Revenue Code; applicable state securities
laws; the supervision and control of the Board of Trustees; such
specific instructions as the Board of Trustees may adopt and as may be
communicated to the Sub-Adviser; the investment objectives, policies
and restrictions of the Fund; and instructions from the Adviser.
3. SUPERVISION AND COMPLIANCE. Notwithstanding any provision of this
Agreement, the Adviser shall retain all rights to supervise, and, in
its discretion, conduct investment advisory activities relating to the
Fund. The activities of the Sub-Adviser shall be subject at all times
to the direction and control of the Board of Trustees of the Trust and
the Adviser, and shall comply with: (a) the Declaration and By-Laws of
the Trust; (b) the Registration Statement of the Trust, as it may be
amended from time to time, including the investment objectives and
policies set forth therein; (c) the Investment Company Act of 1940 and
the Investment Advisers Act of 1940 and the regulations thereunder;
(d) the Internal Revenue Code and the regulations thereunder
applicable to regulated investment companies; (e) any other applicable
laws or regulations; and (f) such other limitations as the Adviser or
the Board of Trustees of the Trust may adopt. The Sub-Adviser shall
comply with all requests by the officers and agents of the Trust to
review, examine or audit any records concerning the Sub-Adviser's
investment advisory activities in connection with the Fund. The
Sub-Adviser shall provide all information, records or other materials
as the Adviser may reasonably request in order to oversee compliance
by the Sub-Adviser with the provisions of this Agreement and with
applicable law and shall take such actions or refrain from taking such
actions as the Adviser in its best judgment may reasonably request as
necessary to promote or ensure such compliance.
4. PURCHASE AND SALE OF SECURITIES. The Sub-Adviser shall place orders
for the purchase or sale or of securities on behalf of the Fund with
any broker and/or dealer who deals in such securities, all in the
manner as set forth herein and in accordance with the Operational
Procedures.
(a) In placing orders with brokers and/or dealers, the
Sub-Adviser shall use its best efforts to obtain the best net price
and the most favorable execution of its orders, after taking into
account all factors it deems relevant, including the breadth of the
market in the security, the price of the security, the financial
condition and execution capability of the broker and/or dealer, and
the reasonableness of the commission, if any, both for the specific
transaction and on a continuing basis. Consistent with this
obligation, the Sub-Adviser may, to the extent permitted by law,
purchase and sell portfolio securities using brokers who provide
brokerage and research services (within the meaning of Section 28(e)
of the Securities Exchange Act of 1934) to or for the benefit of the
Fund and/or other accounts over which the Sub-Adviser or the Adviser
exercises investment discretion. The Sub-Adviser is authorized to pay
a broker who provides such brokerage and research services a
commission for effecting a securities transaction which is in excess
of the amount of commission another broker would have charged for
effecting that transaction, if the Sub-Adviser determines in good
faith that such commission was reasonable in relation to the value of
brokerage and research services provided by such broker. This
determination may be viewed in terms of either that particular
transaction or of the overall responsibilities of the Sub-Adviser with
respect to the accounts as to which it exercises investment
discretion.
(b) Notwithstanding the foregoing, the Board of Trustees and
the Adviser periodically may review the commissions paid by the Fund
and determine whether those commissions were reasonable in relation to
the brokerage and research services received.
5. EXPENSES. The Sub-Adviser shall furnish, at its own expense,
all office space, office facilities, equipment and personnel necessary
or appropriate to the performance of its duties under this Agreement.
The Sub-Adviser also shall pay the salaries of all personnel
performing services related to the Sub-Adviser's duties under this
Agreement.
6. COMPENSATION OF THE SUB-ADVISER. In consideration of the
services to be rendered by the Sub-Adviser under this Agreement, the
Adviser shall pay the Sub-Adviser a fee as set forth in EXHIBIT A to
this Agreement.
7. SERVICES TO OTHERS. The services of the Sub-Adviser to the Adviser
and the Trust are not to be deemed exclusive, and, except as may be
provided in any other agreement between the Sub-Adviser and the
Adviser, the Sub-Adviser may render services to others and to engage
in other activities, so long as such services and activities do not
adversely affect the Sub-Adviser's ability to perform its obligations
under this Agreement; provided, however, that during the term of this
Agreement, the Sub-Adviser shall not render any portfolio management
services to any other open-end management company except with the
prior written consent of the Adviser.
8. REPRESENTATIONS, WARRANTIES, AND AGREEMENTS OF THE SUB-ADVISER
(a) As of the Effective Date of this Agreement (as defined
below in Section 10(a) of this Agreement), the Sub-Adviser will be
registered as an "investment adviser" under the Investment Advisers
Act of 1940.
(b) The Sub-Adviser will comply with the provisions of the
Adviser's written code of ethics and any policies and procedures
thereunder (including any sanctions imposed by the Adviser), and with
the Adviser's policies and procedures designed to detect and prevent
the misuse of material, nonpublic information that are applicable to
its sub-advisory services rendered under this Agreement. In addition,
the Sub-Adviser will adopt or has adopted a written code of ethics
complying with the requirements of Rule 17j-1 under the Investment
Company Act of 1940, will provide the Adviser with a copy of that code
of ethics and evidence of its adoption, and will make such reports to
the Trust as required by Rule 17j-1. The Sub-Adviser will also adopt
or has adopted policies and procedures sufficient to enable the
Sub-Adviser to detect and prevent the misuse of material, nonpublic
information by the Sub-Adviser or any person associated with the
Sub-Adviser, in compliance with the federal and state securities laws.
(c) The Sub-Adviser will prepare, maintain, keep current and
preserve on behalf of the Trust and the Adviser all records concerning
the Sub-Adviser's activities in connection with the Fund that the Fund
is required by law to maintain, including, but not limited to, records
required under paragraphs (b)(5), (b)(6), (b)(9), (b)(10), and (f) of
rule 31a-1 under the Investment Company Act (a summary of these
provisions as currently in effect is attached hereto as EXHIBIT B).
Any records required to be maintained and preserved pursuant to the
provisions of Rule 31a-l and Rule 31a-2 under the Investment Company
Act of 1940 that are prepared by the Sub-Adviser on behalf of the Fund
are the property of the Fund and will be surrendered promptly on
request to the Fund or any person acting on behalf of the Trust during
the term of this Agreement and at any time after the termination of
this Agreement. The Sub-Adviser will comply with all reasonable
requests for information by the Adviser or the Trust's officers or
Board of Trustees, including information required for the Fund's
filings with the Securities and Exchange Commission and state
securities commissions.
(d) The Sub-Adviser will promptly after filing with the
Securities and Exchange Commission any amendment to its Form ADV
furnish a copy of such amendment to the Trust and the Adviser.
(e) The Sub-Adviser will immediately notify the Adviser of
the occurrence of any event which would disqualify the Sub-Adviser
from serving as an investment adviser of an investment company under
Section 9(a) of the Investment Company Act or otherwise.
9. LIMITATIONS ON LIABILITY; INDEMNIFICATION
(a) The Sub-Adviser hereby is notified expressly of the
limitation of liability as set forth as set forth in Article XI of the
Declaration of Trust and agrees that the obligations under this
Agreement of the Fund and of the Trust with respect to the Fund are
limited solely to the assets of the Fund, and the Sub-Adviser shall
not seek satisfaction of any such obligation from any other investment
portfolio of the Trust; any shareholders of any investment portfolio;
any Trustee; or officers, employees or agents of the Trust.
(b) The Sub-Adviser shall give the Adviser and the Trust the
benefit of its best judgment and efforts in rendering services under
this Agreement. The Sub-Adviser agrees to indemnify and hold harmless
the Adviser, its shareholders, officers, directors, employees, agents
and affiliates (referred to collectively herein as the Adviser) from
and against any and all claims, demands, judgments, losses, costs,
expenses (including, without limitation, court costs and attorneys'
fees), liabilities, or damages, which at any time or from time to time
may be paid, incurred or suffered by or asserted against the Adviser,
arising out of, based upon or resulting from any act or omission of
the Sub-Adviser in performing its obligations under this Agreement;
provided, however, that the Sub-Adviser shall not be obligated to
indemnify the Adviser to the extent that such matters arise from or
are caused by the Adviser's willful malfeasance or bad faith.
10. EFFECTIVE DATE; TERMINATION; AND ASSIGNMENT.
(a) This Agreement shall become effective as of the Effective
Date as defined below and shall continue in effect for two years from
the Effective Date and thereafter for successive periods of one year,
subject to the provisions for termination and all of the other terms
and conditions in this Agreement if: (i) such continuation is
specifically approved at least annually by the vote of a majority of
the Trustees of the Trust, including a majority of the Trustees who
are not parties to this Agreement or interested persons of any such
party (other than as Trustees of the Trust), cast in person at a
meeting called for that purpose, and, where required under the
Investment Company Act of 1940, by vote of a majority of the
outstanding voting securities of the Fund; and (ii) neither party has
notified the other in writing at least sixty (60) days prior to the
anniversary date of the Effective Date in any year thereafter that it
does not desire such continuation. The Effective Date is the date on
which this Agreement is approved by the vote of a majority of the
outstanding voting securities of the Fund.
(b) This Agreement may be terminated at any time without the
payment of any penalty (i) by action of the Board of Trustees or by
vote of a majority of the outstanding voting securities of the Fund
upon sixty (60) days' written notice to the Sub-Adviser and (ii) in
the event of termination of the Contract for any reason whatsoever.
This Agreement also may be terminated at any time by the Adviser (i)
on account of the Sub-Adviser's repeated failure to comply with the
Adviser's requests or instructions issued hereunder, or (ii) in the
event of a breach of fiduciary duty by the Sub-Adviser.
(c) Termination of this Agreement will not affect (i) the
validity of any action previously taken by the Adviser or the
Sub-Adviser under this Agreement or (ii) liabilities or obligations of
the parties from transactions initiated before termination of this
Agreement. Anything herein to the contrary notwithstanding,
termination of this Agreement shall not affect the indemnification
provisions set forth above in Section 9 of this Agreement, which shall
remain operative and in full force and effect notwithstanding such
termination.
(d) This agreement shall terminate automatically in the event
of its assignment (as defined in the Investment Company Act of 1940
and any rules thereunder, as they may be interpreted by the staff of
the Securities and Exchange Commission).
(e) So long as both the Adviser and the Sub-Adviser shall be
legally qualified to act as an investment adviser to the Fund, neither
the Adviser nor the Sub-Adviser shall act as an investment adviser (as
such term is defined in the Investment Company Act of 1940) to the
Fund except as provided herein and in the Contract or in such other
manner as may be expressly agreed between the Adviser and the
Sub-Adviser; provided, however, that if the Adviser or the Sub-Adviser
shall resign or for any reason be unable or unwilling to serve prior
to the end of the term of this Agreement, the remaining party, the
Sub-Adviser or the Adviser as the case may be, shall not be prohibited
from serving as an investment adviser to the Fund by reason of the
provisions of this Subsection 10(e).
11. GOVERNING LAW. This Agreement shall be construed in accordance
with the laws of the Commonwealth of Pennsylvania without giving
effect to the choice of law provisions thereof, to the extent that
such laws are consistent with provisions of the Investment Company Act
of 1940 and the regulations thereunder.
12. AMENDMENT. This Agreement may be amended from time to time by
agreement of the parties; provided, however, such amendment shall be
approved by the vote of a majority of the Trustees of the Trust,
including a majority of the Trustees who are not parties to this
Agreement or interested persons of any such party (other than as
Trustees of the Trust), cast in person at a meeting called for that
purpose, and, where required under the Investment Company Act of 1940,
by vote of a majority of the outstanding voting securities of the
Fund;
13. WAIVER. The failure of either party to insist, in one or more
instances, upon strict performance of the obligations of this
Agreement, or to exercise any rights contained herein, shall not be
construed as a waiver, or relinquishment for the future of such
obligation or right, which shall remain and continue in full force and
affect.
14. MISCELLANEOUS. The captions in this Agreement are included for the
convenience of reference only and in no way define or delimit any of
the provisions hereof or otherwise affect their construction or
effect. Should any part of this Agreement be held or made invalid by a
court decision, statute, regulation, or otherwise, the remainder of
this Agreement shall not be affected thereby. This Agreement may be
executed in one or more counterparts, each of which shall be deemed an
original, but all of which together shall constitute one and the same
instrument.
IN WITNESS WHEREOF, the Adviser and the Sub-Adviser have caused this
Agreement to be executed and delivered in their names and on their
behalf by the undersigned, duly authorized officers, all as of the day
and year first above written.
PARKSOUTH CORPORATION
By: ____________________________
name:_________________________
title:__________________________
WOMACK ASSET MANAGEMENT, INC.
By: __________________________
name:_________________________
title:__________________________
EXHIBIT A
DG INVESTOR SERIES
DG OPPORTUNITY FUND
Sub-Advisory Agreement
SUB-ADVISORY FEES
For all services rendered by the Sub-Adviser hereunder, the
Adviser shall pay, on a monthly basis, a Sub-Advisory Fee, based on
the average daily net assets of the Fund under management by the
Sub-Adviser during the preceding month, as described below. The
Sub-Advisory fee shall be the sum of: .32% of average daily net assets
up to $50 million; .075% of average daily net assets in excess of $50
million and up to $70 million; and .25% of average daily net assets in
excess of $70 million. The Sub-Advisory Fee will be accrued daily, and
for any period in which the Sub-Adviser provides portfolio management
services under this Agreement for less than one full month, the
Sub-Advisory Fee will be prorated by the number of the days of the
month during which such services were rendered.
EXHIBIT B
DG INVESTOR SERIES
DG OPPORTUNITY FUND
Sub-Advisory Agreement
RECORDS TO BE MAINTAINED BY THE SUB-ADVISER
1. (RULE 31A -1(B)(5) AND (6) OF THE INVESTMENT COMPANY ACT OF 1940).
A record of each brokerage order, and all other portfolio purchases
and sales orders by the Sub-Adviser or on behalf of the Fund for, or
in connection with, the purchase or sale of securities, whether
executed or unexecuted. Such records shall include:
A. The name of the broker,
B. The terms and conditions of the order, and of any
modification or cancellation thereof,
C. The time of entry or cancellation,
D. The price at which executed,
E. The time of receipt of report of execution, and
F. The name of the person who placed the order on behalf of
the Fund
2. (RULE 31A-1(B)(9) OF THE INVESTMENT COMPANY OF 1940). A record for
each fiscal quarter, completed within ten (10) days after the end of
the quarter, showing specifically the basis or bases upon which the
allocation of orders for the purchase and sale of portfolio securities
to brokers or dealers was made, and the division of brokerage
commissions or other compensation on such purchase and sale orders.
The record:
A. Shall include the consideration given to:
(i) the sale of shares of a feeder fund of the Portfolio
(ii) the supplying of services or benefits by brokers or
dealers to:
(a) The Fund,
(b) The Adviser,
(c) yourself (the Sub-Adviser), and
(d) Any person other than the foregoing.
(iii) Any other considerations other than the
technical qualifications of the brokers and
dealers as such.
B. Shall show the nature of the services or benefits made
available.
C. Shall describe in detail the application of any
general or specific formula or other determinant
used in arriving at such allocation of purchase and
sale orders and such division of brokerage
commissions or other compensation.
D. Shall include the name of the person responsible for making
the determination of such allocation and such division of
brokerage commissions or other compensation.
3. (RULE 31A-1(B)(10) OF THE INVESTMENT COMPANY ACT OF 1940). A record
in the form of an appropriate memorandum identifying the person or
persons, committees, or groups authorizing the purchase or sale of
portfolio securities. Where an authorization is made by a committee or
group, a record shall be kept of the names of its members who
participate in the authorization. There shall be retained as part of
this record any memorandum, recommendation, or instruction supporting
or authorizing the purchase or sale of portfolio securities and such
other information as is appropriate to support the authorization.*
4. (RULE 31A-1(F) OF THE INVESTMENT COMPANY ACT OF 1940). Such
accounts, books and other documents as are required to be maintained
by registered investment advisers by rule adopted under Section 204 of
the Investment Advisers Act of 1940, to the extent such records are
necessary or appropriate to record the Sub-Adviser's transactions made
with respect to the Fund Account.
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* Such information might include: the current Form 10-K, annual and
quarterly reports, press releases, reports by analysts and from
brokerage firms (including their recommendations, i.e., buy, sell,
hold), and any internal reports or portfolio manager reviews.
PLEASE MARK VOTES AS IN
THIS EXAMPLE
x
FOR
AGAINST
ABSTAIN
1.) To approve or disapprove a Sub-Advisory Agreement and exhibits thereto,
between ParkSouth Corporation and Womack Asset Management, Inc. on behalf of
DG Opportunity Fund.
2.) To transact such other business as may properly come before the meeting or
any adjournment thereof.
RECORD DATE SHARES:
Date
Please be sure to sign and date this Proxy.
Mark box at right if comments or address change have been noted on the
reverse side of this card.
Shareholder sign here
Co-owner sign here
DETACH CARD
DG INVESTOR SERIES
Please take note of the important information enclosed with the Proxy
Ballot. There are a number of issues related to the management and
operation of your Fund that require your immediate attention and
approval. These are discussed in detail in the enclosed proxy
materials.
Your vote counts, and you are strongly encouraged to exercise your
right to vote your shares.
Please mark the boxes on the proxy card to indicate how your shares
shall be voted. Then sign the card, detach it and return your proxy
card in the enclosed postage paid envelope.
Your vote must be received prior to the Special Meeting of
Shareholders, July 21, 1997.
Thank you in advance for your prompt consideration of these matters.
Sincerely,
DG Investor Series
DG INVESTOR SERIES
THE PROXY IS SOLICITED ON BEHALF OF THE BOARD OF TRUSTEES
KNOW ALL PERSONS BY THESE PRESENTS that the undersigned Shareholders
of DG Opportunity Fund hereby appoint C. Grant Anderson, Patricia F.
Conner, Marie M. Hamm, Carol B. Kayworth, and Daniel J. Damico, or any
one of them, true and lawful attorneys, with the power of substitution
of each, to vote all Shares of DG Opportunity Fund which the
undersigned is entitled to vote at the Special Meeting of Shareholders
to be held on July 21, 1997, at Federated Investors Tower, Pittsburgh,
Pennsylvania, at 3:00 p.m., and at any adjournment thereof.
The attorneys named will vote the Shares represented by this proxy in
accordance with the choices made on this ballot. If no choice is
indicated as to any item, this proxy will be voted affirmatively on
that matter. The approval of each proposal is not contingent on the
approval of any other matter.
PLEASE RETURN THIS PORTION WITH YOUR VOTE IN THE ENCLOSED ENVELOPE AND
RETAIN THE BOTTOM PORTION.
PLEASE VOTE, DATE, AND SIGN ON OTHER SIDE AND RETURN PROMPTLY IN
ENCLOSED ENVELOPE.
Please sign this proxy exactly as your name appears on the books of
the Fund. Joint owners should each sign personally. Trustees and other
fiduciaries should indicate the capacity in which they sign, and where
more than one name appears, a majority must sign. If a corporation,
this signature should be that of an authorized officer who should
state his or her title.
DO YOU HAVE ANY COMMENTS?
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HAS YOUR ADDRESS CHANGED?
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