SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[X] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted by
Rule 14a-6(e)(2))
[ ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Sec. 240.14a-11(c) or
Sec. 240.14a-12
OPTIMUM FUND TRUST
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(Name of Registrant as Specified In Its Charter)
N/A
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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.
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and 0-11.
1. Title of each class of securities to which transaction applies:
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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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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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OPTIMUM FUND TRUST
Optimum Small Cap Growth Fund
IMPORTANT SHAREHOLDER INFORMATION
These materials are for a special meeting of shareholders scheduled for March
23, 2004 at 11:00 a.m., Eastern time. This information will provide you with
details of the proposals to be voted on at the special meeting, and includes
your Proxy Statement and proxy card. A proxy card is, in essence, a ballot. When
you vote your proxy, it tells us how you wish to vote on important issues
relating to your Fund. If you complete and sign the proxy, we'll vote it exactly
as you tell us. If you simply sign the proxy, we'll vote it in accordance with
the Board of Trustees' recommendations on page 2 of the Proxy Statement.
WE URGE YOU TO SPEND A FEW MINUTES REVIEWING THE PROPOSALS IN THE PROXY
STATEMENT. THEN, FILL OUT, SIGN, AND DATE THE PROXY CARD AND RETURN IT TO US SO
THAT WE KNOW HOW YOU WOULD LIKE TO VOTE.
OPTIMUM FUND TRUST
A LETTER FROM THE PRESIDENT
Dear Shareholders:
Enclosed is a Notice of Special Meeting of Shareholders (the "Special Meeting")
of Optimum Small Cap Growth Fund (the "Fund") a series of Optimum Fund Trust
(the "Trust"). The Special Meeting will be held March 23, 2004 at 11:00 a.m.,
Eastern time, at 2001 Commerce Square, 2nd Floor Auditorium, Philadelphia, PA
19103. The materials that we have included discuss the proposals to be voted on
at the Special Meeting that will affect the future of the Trust and the Fund.
The Board of Trustees of the Trust recommends that shareholders cast their votes
in favor of approving:
1. A new Sub-Advisory Agreement between Delaware Management Company,
a series of Delaware Management Business Trust ("Delaware"), and
Oberweis Asset Management, Inc. ("Oberweis") whereby Oberweis
would have co-management responsibility for providing investment
advisory services to the Fund.
2. The transaction of such other business as may properly come
before the Special Meeting or any adjournment thereof.
The Proxy Statement includes a question and answer format designed to
provide you with a simpler, more concise explanation of certain issues. Although
much of the information in the Proxy Statement is technical and is required by
the various regulations that govern the Trust and the Fund, we hope that this
Q&A format will be helpful to you.
Please take the time to review this entire document and vote now!
Whether or not you plan to attend the Special Meeting, please vote your shares
by mail or by telephone or by the Internet. If you determine at a later date
that you wish to attend this Meeting, you may revoke your proxy and vote in
person.
Thank you for your prompt attention and participation.
Sincerely,
Jude T. Driscoll
President
OPTIMUM FUND TRUST
Optimum Small Cap Growth Fund
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
TO BE HELD ON MARCH 23, 2004
NOTICE IS HEREBY GIVEN that a Special Meeting of Shareholders (the "Special
Meeting") of Optimum Small Cap Growth Fund (the "Fund"), a series of Optimum
Fund Trust, will be held at 2001 Commerce Square, 2nd Floor Auditorium,
Philadelphia, Pennsylvania 19103, on March 23, 2004 at 11:00 a.m., Eastern time,
to vote on the agenda items listed below. If approved by shareholders, these
changes will take effect on or about April 1, 2004. Shareholders will be
notified if any of these changes are not approved.
1. To approve a new Sub-Advisory Agreement between the Delaware
Management Company, a series of Delaware Management Business
Trust, ("Delaware") and Oberweis Asset Management, Inc.
("Oberweis"), whereby Oberweis would have co-management
responsibility for providing investment advisory services to the
Fund.
2. To transact such other business as may properly come before the
Special Meeting or any adjournment thereof.
The Board of Trustees has fixed January 30, 2004 as the record date for
determination of the shareholders entitled to notice of, and to vote at, the
Special Meeting or any adjournments of the Special Meeting.
By Order of the Board of Trustees,
Richelle S. Maestro
Secretary
February 9, 2004
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PLEASE SIGN, DATE AND RETURN THE ENCLOSED PROXY
PROMPTLY TO AVOID ADDITIONAL EXPENSE.
You can help 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 Special Meeting, 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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TABLE OF CONTENTS
PAGE
----
Questions and Answers About the Special Meeting and the Proxy Statement...........................
Proposal 1: Approval of the Proposed Sub-Advisory Agreement with Oberweis.........................
Other Matters.....................................................................................
Voting Information................................................................................
Exhibit A: Form of Sub-Advisory Agreement between Delaware Management Company and Oberweis Asset
Management, Inc....................................................................... A-1
OPTIMUM FUND TRUST
Optimum Small Cap Growth Fund
2005 Market Street
Philadelphia, PA 19103
PROXY STATEMENT
QUESTIONS AND ANSWERS ABOUT THE SPECIAL MEETING
AND PROXY STATEMENT
INFORMATION ABOUT VOTING
Q. Who is asking for my vote?
A. The Board of Trustees (the "Board" or the "Trustees") of Optimum Fund
Trust (the "Trust"), in connection with the special meeting of
shareholders of the Optimum Small Cap Growth Fund (the "Fund") to be
held at 11:00 a.m., Eastern time, on March 23, 2004 (the "Special
Meeting") at 2001 Commerce Square, 2nd Floor Auditorium, Philadelphia,
PA 19103, is requesting your vote on several matters. It is expected
that the notice of the Special Meeting, the proxy card, and this Proxy
Statement will be first mailed to shareholders of record on or about
February 16, 2004.
Q. Who is eligible to vote?
A. Shareholders of record of the Fund at the close of business on January
30, 2004 (the "Record Date") are entitled to notice of and to vote at
the Special Meeting or at any adjournment of the Special Meeting.
Shareholders of record will be entitled to one vote for each full share
and a fractional vote for each fractional share that they hold on each
matter presented at the Special Meeting.
Q. What is being voted on at the Special Meeting?
A. The Board is asking shareholders to vote on the following proposals
affecting the Fund:
1. To approve or disapprove a new Sub-Advisory Agreement between
Delaware Management Company, a series of Delaware Management
Business Trust ("Delaware" or the "Manager") and Oberweis
Asset Management, Inc. ("Oberweis"), whereby Oberweis would
have co-management responsibility for providing investment
advisory services to the Fund.
2. To transact such other business as may properly come before
the Special Meeting or any adjournment thereof.
On December 18, 2003, the Board of Trustees approved Oberweis as an
additional sub-adviser for the Optimum Small Cap Growth Fund, subject
to receiving shareholder approval. Delaware and Columbia Wanger Asset
Management, L.P. ("Columbia") currently serve and will continue to
serve as adviser and sub-adviser, respectively. If approved by
shareholders, Oberweis will begin sub-advising its portion of the
Fund's assets on or about April 1, 2004.
Q. How do the Trustees recommend that I vote on these proposals?
A. The Trustees recommend that shareholders vote FOR each proposal.
Q. Who is Oberweis?
A. Oberweis is an investment adviser that is registered with the SEC.
Oberweis currently acts as a sub-adviser to other investment companies
that have investment objectives and policies similar to those of the
Fund.
Q. How will shareholders of the Fund benefit from the approval of the
proposed Sub-adviser?
A. Based on a number of factors considered in the selection process
Delaware believes that Oberweis will be a beneficial co-manager for the
Fund. As described in greater detail below, in conjunction with its
Investment Consultant, Linsco Private Ledger, Inc. ("LPL"), Delaware
reviewed and analyzed potential co-managers for the Fund based on among
other factors, return in both up and down markets, standard deviation,
investment style, industry exposures, market capitalization, and
tracking error versus the benchmark and how well their investment style
complemented the current sub-advisor. Based on these criteria, as well
as a number of other factors, Delaware recommended to the Board, and
the Board approved, the selection of Oberweis.
Q. Who is paying for expenses related to the Special Meeting?
A. The Fund will bear the costs relating to the Proxy Statement
preparation, printing, mailing and solicitation and the Special
Meeting. The Fund is still relatively small, having only commenced
operations in August 2003, and the seed capital invested by Delaware
and its affiliates (as described more fully later) should assist in
keeping solicitation expenses lower.
Q. When will the Proposal take effect if it is approved?
A. If approved, the Proposal will become effective on or about April 1,
2004.
Q. How do I vote my shares?
A. You may vote your shares in person by attending the Special Meeting or
by mail. To vote by mail, fill out, sign, date and send us the enclosed
proxy in the envelope provided.
Proxy cards that are properly signed, dated and received at or prior to
the Special Meeting will be voted as specified. If you specify a vote
for the Proposal, your proxy will be voted as you indicate. If you
simply sign, date and return the proxy card, but do not specify a vote
for the Proposal, your shares will be voted by the proxies as follows:
o IN FAVOR of Oberweis serving as a sub-adviser for the Fund
(Proposal 1)
Q. If I send my proxy in now as requested, can I change my vote later?
A. You may revoke your proxy at any time before it is voted by: (1)
sending to the Secretary of the Trust a written revocation, or (2)
forwarding a later-dated proxy that is received by the Trust at or
prior to the Special Meeting, or (3) attending the Special Meeting and
voting in person. Even if you plan to attend the Special Meeting, we
ask that you return the enclosed proxy. This will help us ensure that
an adequate number of shares are present for the Special Meeting to be
held.
PROPOSAL: APPROVAL OF THE PROPOSED SUB-ADVISORY AGREEMENT
WITH OBERWEIS BY SHAREHOLDERS OF
THE FUND
What changes are being proposed for the Fund?
The Fund is one of several series of the Trust. The investment affairs of the
Fund, and each of the other series of the Trust, are managed by Delaware. For
each series of the Trust other than the Fund, the assets are currently divided
into multiple segments, each of which is managed separately by a sub-adviser
using its proprietary investment strategies, subject to the supervision of
Delaware and the Board. In the case of the Fund, only one sub-adviser, Columbia,
was initially approved to manage the Fund's assets. The addition of Oberweis as
a sub-adviser to the Fund would therefore make its portfolio management
structure like that of the other series of the Trust.
At its December Board Meeting, the Board approved, upon the recommendation of
Delaware, and the Trust's management, acted to approve a new sub-advisory
agreement between Delaware and Oberweis ("the Proposed Sub-advisory Agreement"),
the form of which is attached as Exhibit A to this Proxy Statement, appointing
Oberweis as a sub-adviser for the Fund to co-manage the Fund's portfolio with
Columbia.
For the reasons described in greater detail below, the Board approved the
appointment of Oberweis as sub-adviser for the Fund. Oberweis has accepted the
appointment, which will to become effective on or about April 1, 2004, subject
to the approval of the shareholders of the Fund at the Special Meeting.
Shareholders of the Fund are now being asked to approve the Proposed
Sub-advisory Agreement.
As provided in the Proposed Sub-advisory Agreement, Delaware will, in its
capacity as investment adviser for the Fund, determine what portion of the
Fund's assets should be allocated to Oberweis. The percentage of the Fund's
total assets that will be allocated to Oberweis may be modified, from time to
time, at Delaware's sole discretion. As with the other series in the Trust,
Delaware expects that each sub-adviser to the Fund will manage approximately
one-half of the Fund's assets.
What did the Board consider and review in determining to recommend Oberweis as
a sub-adviser?
The choice of Oberweis followed an extensive search and rigorous screening
process. Each manager that passed the initial screening was further reviewed to
assess that manager's investment philosophy and process, the qualifications and
suitability of the people making those decisions, the organizational structure
of the manager, including the resources dedicated to the management of
portfolios with a similar mandate, how well their investment style complemented
the current sub-advisor and the characteristics and performance record of
portfolios with a similar mandate.
After identifying a relatively small number of candidates that satisfied the
initial criteria, further screening based on specific investment criteria was
conducted. In making its final decision, Delaware also conducted exhaustive due
diligence to ensure that the successful candidates were financially sound and
otherwise stable, had capable and experienced employees in key positions and had
good regulatory and financial controls. As a result of this selection process,
Delaware identified Oberweis as its first choice for co-manager.
At its December Board Meeting, the Trustees met and conferred with
representatives of Delaware and LPL, an investment consultant, to consider the
proposal by Delaware and its effects on the Fund. The Board had the assistance
of legal counsel who provided advice on, among other things, the Board's
fiduciary obligations in considering the Proposed Sub-advisory Agreement.
In evaluating the Proposed Sub-Advisory Agreement, the Board reviewed materials
furnished by Oberweis, Delaware and the Trust's counsel. The Board reviewed
information about Oberweis, including its personnel, operations, and financial
condition.
The Board specifically considered the following factors as relevant to its
recommendations to approve Oberweis as a sub-adviser for the Fund: (1) Oberweis
will co-manage approximately one-half of Fund's investment portfolio; (2) the
favorable history, qualifications and background of Oberweis and its personnel;
(3) the comparative performance information of Oberweis with regard to managing
mutual funds and investment portfolios similar to the Fund; (4) Delaware's due
diligence review of Oberweis and recommendation to engage Oberweis as a
sub-adviser of the Fund; (5) Delaware's services to the Fund; and (6) the
compatibility of Oberweis's investment philosophy and methodology with
Columbia's investment philosophy and methodology. As part of the due diligence
process, the results of which were shared with the Board, Delaware reviewed
Oberweis' investment personnel and corporate structure, code of ethics,
brokerage practices and policies regarding use of brokerage commissions, proxy
voting, and disaster recovery.
Delaware, in conjunction with the investment consultant, reviewed with the Board
the top nine managers that passed the initial screening process. The Board
reviewed the statistical information as to the investment fit, the performance
and other analytical data that indicated that Oberweis was among the two best
statistical fit for the Fund. Over the period analyzed Oberweis' performance in
upward markets was the second best among the top managers and the number of
times it beat the market average (as represented by the Russell 2000 Growth
Index for this Fund) was tied for second best among the top managers. Finally,
the Board also reviewed information regarding an analysis of past Fund
performance as compared to the Russell 2000 Growth Index with different pairings
of managers in conjunction with varying mixes of allocation of assets to each
manager. It was determined that based on Oberweis' excellent statistical fit and
the results of the due diligence that Oberweis was the appropriate second
sub-adviser to recommend for the Fund.
After due consideration, the Board, including a majority of the disinterested
Trustees (the "Independent Trustees"), approved the appointment of Oberweis as a
proposed sub-adviser for the Fund to manage approximately one-half of the Fund's
portfolio, subject to the approval of the Fund's shareholders at the Special
Meeting.
What should I know about Oberweis?
Oberweis Asset Management, Inc. was founded in September, 1989 and was
registered with the SEC in January, 1990. Oberweis has one office located at 951
Ice Cream Drive, Suite 200, North Aurora, Illinois 60542. Oberweis' entire
investment and professional staff are located at this address.
Set forth below is a listing of the principal executive officer and each
director or general partner of Oberweis. The positions of the principal
executive officer and each director or general partner with Oberweis constitute
their principal occupations.
Name Title/Position
---- --------------
James W. Oberweis President/Portfolio Manager
Martin Yokosawa Senior Vice President/Portfolio Manager
James D. Oberweis Chairman/Research Emeritus
Patrick B. Joyce Executive Vice President
Brian K. Lee Director of Marketing & Client Services
David I. Covas Analyst
If approved by the shareholders, approximately one-half of the Fund's portfolio
will be managed by Oberweis's team of portfolio managers who are supported by
specialized fundamental, quantitative and technical analysts.
Oberweis currently manages the assets of two other investment companies that
have an investment objective similar to that of the Fund.
Annual Advisory Fee
-------------------
Name of Fund Net Assets Managed
------------ by Oberweis as of
September 30, 2003
------------------
AIG SunAmerica (as Sub-adviser) $52.4 million ____*
Oberweis Emerging Market Growth Portfolio (as Adviser) $222.1 million 0.90%
*This is the annual advisory fee payable to the adviser of the fund. Oberweis is
paid a portion of this fee from the adviser to the fund.
Oberweis is not affiliated with Delaware. No Trustee of the Trust has owned any
securities, or has had any material interest in, or a material interest in a
material transaction with, Oberweis or its affiliates since the beginning of the
Fund's most recent fiscal year. No officer or trustee of the Trust is an
officer, employee, director, general partner or shareholder of Oberweis.
What are the provisions of the Proposed Sub-advisory Agreement?
The Proposed Sub-advisory Agreement for the Fund will be dated as of March 23,
2004, or a later date following approval by shareholders of the Fund. The
Proposed Sub-advisory Agreements will be in effect for an initial period of two
years, to be continued thereafter from year to year if approved in conformity
with the requirements of the Investment Company Act of 1940, as amended (the
"1940 Act").
The Proposed Sub-advisory Agreement provides that it may be terminated at any
time without penalty by vote of the Board or by vote of a majority of the Fund's
outstanding voting securities on 60 days' written notice to Oberweis, as
applicable. The Proposed Sub-advisory Agreement also may be terminated without
penalty by Delaware immediately upon written notice to Oberweis, if, in the
reasonable judgement of the Adviser, Oberweis becomes unable to discharge its
duties and obligations under the Proposed Sub-advisory Agreement. Lastly, the
Proposed Sub-advisory Agreement may be terminated by Oberweis on 60 days'
written notice to Delaware. The Proposed Sub-advisory Agreement automatically
terminates in the event of its assignment. The provisions of the Proposed
Sub-advisory Agreement are substantially identical to those of each other
sub-adviser to the other series of the Trust, including Columbia.
Will the approval of the Proposed Sub-advisory Agreement impact the Fund's
current investment advisory agreement, or raise the Fund's advisory fees or
other expenses?
Pursuant to an Investment Advisory Agreement dated July 17, 2003 (the "Advisory
Agreement"), Delaware receives an annual advisory fee from the Fund. This fee is
payable to Delaware at the annual rate of 1.10%, based on average daily net
assets of the Fund. The terms of the Advisory Agreement will not be affected by
this Proposal. The Fund does not bear any responsibility for the payment of
sub-advisory fees and, therefore, approval of the Proposed Sub-advisory
Agreement will not affect the overall investment advisory fee payable by the
Fund to Delaware or otherwise result in an increase in Fund expenses.
Why is the Proposed Sub-advisory Agreement being presented for shareholder
approval?
Generally speaking, Section 15(c) of the 1940 Act forbids an investment company
from entering into, renewing, or performing under any advisory agreement
(including any sub-advisory agreement), unless the advisory arrangement has been
approved by the vote of the majority of the disinterested Trustees. The Board,
including a majority of the Independent Trustees, approved the sub-advisory
agreement for Oberweis at its December Meeting. However, Section 15(a) of the
1940 Act also generally requires approval of a majority of the investment
company's voting securities. Therefore, the proposed sub-advisory agreement with
Oberweis is being presented for your approval as shareholders of the Fund.
As described in the Prospectus, the Trust has applied for an exemptive order
from the SEC ("Multi-Manager Order") that would permit Delaware, subject to
certain conditions, to enter into sub-advisory agreements with sub-advisers
approved by the Trustees, but without the requirement of shareholder approval.
If the Trust obtains the Multi-Manager Order, Delaware will be able, subject to
the approval of the Trustees, but without shareholder approval, to employ new
sub-advisers for new or existing funds, change the terms of particular
sub-advisory agreements or continue the employment of existing sub-advisers
after events that under the 1940 Act and the sub-advisory agreements would cause
an automatic termination of the agreement. Although shareholder approval would
not be required for the termination of sub-advisory agreements, shareholders
would continue to have the right to terminate such agreements for the relevant
fund at any time by a vote of a majority of outstanding voting securities of
that fund.
THE BOARD OF TRUSTEES RECOMMENDS THAT
SHAREHOLDERS OF THE FUND
VOTE FOR THE PROPOSAL
OTHER MATTERS
Additional Considerations Reviewed by the Board
In light of the current examination by the SEC and other governmental
authorities of the mutual fund industry relating to late trading, frequent
trading, market timing, valuations and manager employee transactions in mutual
fund shares, Delaware has inquired of Oberweis as to whether it had received
requests for information arising from the examinations and the status of its
response, and whether, as a result of its internal investigation necessary to
respond, it had identified matters or areas of concern that might adversely
affect its ability to perform the responsibilities proposed to be undertaken by
it under the applicable agreement. Delaware was assured that, although their
investigations were continuing and additional information and/or actions of the
SEC or governmental authorities may yield a contrary result, no information
which had come to light caused Oberweis concern as to their ability to perform
its respective responsibilities. The Board, Delaware and Oberweis recognize that
developments affecting the investment company industry have rapidly unfolded in
unpredictable ways and that circumstances may arise that could adversely affect
the ability of Oberweis to perform its responsibilities. If any of such
circumstances arise, the Board will act in the best interests of the Fund.
VOTING INFORMATION
How many votes are necessary to approve the Plan?
Provided that a quorum is present, the approval of the Proposal requires the
affirmative vote of the lesser of (i) more than 50% of the outstanding voting
securities of the Fund, or (ii) 67% or more of the voting securities of the Fund
present at the Special Meeting, if the holders of more than 50% of the Fund's
outstanding voting securities are present or represented by proxy. One third of
the shares of the Fund entitled to vote in person or by proxy shall be a quorum
for the transaction of business at the Special Meeting. Each shareholder will be
entitled to one vote for each dollar of Net Asset Value (number of shares owned
times Net Asset Value per share), and a fractional vote for each fractional
dollar amount, of the Fund held on the Record Date. If sufficient votes to
approve the Proposal for the Fund are not received by the date of the Special
Meeting, the Special Meeting may be adjourned with respect to the Fund to permit
further solicitations of proxies. The holders of a majority of shares of the
Fund entitled to vote at the Special Meeting and present in person or by proxy
(whether or not sufficient to constitute quorum) may adjourn the Special Meeting
with respect to the Fund. The Special Meeting may also be adjourned by the
chairperson of the Special Meeting.
Abstentions and broker non-votes will be included for purposes of determining
whether a quorum is present at the Special Meeting, and will have the same
effect as a vote "against" the Proposal. It is not anticipated that any broker
non-votes will be received.
How many shares does Delaware own and how will it vote?
Delaware and its affiliates provided the initial investment, or "seed capital,"
for formation of the Trust and each of its series, including the Fund and for
sufficient assets for the sub-adviser to manage effectively. The Fund has only
been offering its shares to other investors since August 1, 2003, or just six
months prior to the record date. As a result, the initial investment of Delaware
and its affiliates still represents a significant number of shares of the Fund.
As shown in the table below, Delaware and its affiliates own 488,238.294 shares
or 35.34% of the Fund. This means that Delaware and its affiliates, who
currently intend to vote in favor of the Proposal, have a significant influence
over the vote and could, under some circumstances, control the vote.
How do I ensure my vote is accurately recorded?
You may attend the Special Meeting and vote in person. You may also vote by
completing and signing the attached proxy card and mailing it in the enclosed
postage paid envelope. A proxy card is, in essence, a ballot. If you simply sign
and date the proxy but give no voting instructions, your shares will be voted in
favor of the Proposal and in accordance with the views of management upon any
unexpected matters that come before the Special Meeting or adjournment of the
Special Meeting. You may also call toll-free to vote by telephone, or you may
vote using the Internet.
Can I revoke my proxy?
You may revoke your proxy at any time before it is voted by sending a written
notice to the Trust expressly revoking your proxy, by signing and forwarding to
the Trust a later-dated proxy, or by attending the Special Meeting and voting in
person. If your shares are held through a broker-dealer and you wish to vote
your shares in person at the Special Meeting, you must obtain a "legal proxy"
from your broker-dealer and present it to the Inspector of Elections at the
Special Meeting.
What other matters will be voted upon at the Special Meeting?
The Board of Trustees of the Trust does not intend to bring any matters before
the Special Meeting other than that described in this proxy. It is not aware of
any other matters to be brought before the Special Meeting by others. If any
other matter legally comes before the Special Meeting, proxies for which
discretion has been granted will be voted in accordance with the views of
management.
Who is entitled to vote?
Only shareholders of record of the Fund at the close of business on the Record
Date which is January 30, 2004, will be entitled to vote at the Special Meeting.
As of the Record Date, there were 1,381,394.969 outstanding shares of the Fund.
What other solicitations will be made?
This proxy solicitation is being made by the Board of Trustees of the Trust, on
behalf of the Fund, for use at the Special Meeting. The cost of this proxy
solicitation will be shared as set forth above. In addition to solicitation by
mail, solicitations also may be made by advertisement, telephone, telegram,
facsimile transmission or other electronic media, or personal contacts.
In addition to solicitation services to be provided by D.F. King & Co., Inc.
("D.F. King"), as described below, proxies may be solicited by the Trustees,
officers and employees of the Trust (none of whom will receive compensation
therefor in addition to their regular salaries) and/or regular employees of
Delaware or other service providers, or any of their affiliates. Arrangements
will also be made with brokerage houses and other custodians, nominees and
fiduciaries to forward solicitation materials to the beneficial owners of the
Fund's shares, and such persons will be reimbursed for their expenses.
Principal Holders of Shares
On the Record Date, the officers and Trustees of the Trust, as a group, owned
less than 1% of the outstanding voting shares of the Fund.
To the best knowledge of the Fund, as of the Record Date, no person, except as
set forth in the table below, owned of record 5% or more of the outstanding
shares of any class of the Fund. The Fund has no knowledge of beneficial
ownership.
------------------- ---------------------------------------------- ---------------------- ---------------------
Class Name and Address of Account Share Amount Percentage
--------------------------- ------------ ----------
------------------- ---------------------------------------------- ---------------------- ---------------------
Class A
------------------- ---------------------------------------------- ---------------------- ---------------------
Class B
------------------- ---------------------------------------------- ---------------------- ---------------------
Class C
------------------- ---------------------------------------------- ---------------------- ---------------------
Class I DMH CORP 488,235.294 69.88%
ATTN JOSEPH HASTINGS
2005 MARKET STREET
PHILADELPHIA, PA 19103
------------------- ---------------------------------------------- ---------------------- ---------------------
Shareholder Proposals and Discretion of Persons Named in the Proxy.
The Fund is not required, and does not intend, to hold regular annual
shareholders' meetings. Shareholders wishing to submit proposals for
consideration for inclusion in a proxy statement for the next shareholders'
meeting should send their written proposals to the Fund's offices, c/o Delaware
Investments, Two Commerce Square, 2001 Market Street, Philadelphia, Pennsylvania
19103 so they are received within a reasonable time before any such meeting. No
business other than the matters described above is expected to come before the
Meeting, but should any other matter requiring a vote of shareholders arise,
including any question as to an adjournment or postponement of the Meeting, the
persons named on the enclosed proxy card will vote on such matters in accordance
with the views of management.
OPTIMUM SMALL CAP GROWTH FUND
OPTIMUM SMALL CAP GROWTH FUND
Proxy for Special Meeting of Shareholders--March 23, 2004
The undersigned hereby appoints Richelle S. Maestro and Brian L. Murray, Jr. and
Anthony G. Ciavarelli, or any of them, each with the right of substitution,
proxies of the undersigned at the Special Meeting of Shareholders of the fund
named above (the "Fund"), a series of the Trust (as defined in the proxy
statement) to be held at the offices of Delaware Investments located at Two
Commerce Square, 2001 Market Street, 2nd Floor Auditorium, Philadelphia,
Pennsylvania 19103, on Tuesday, March 23, 2004 at 11:00 a.m. (E.S.T.), or at any
postponement or adjournments thereof, with all the powers which the undersigned
would possess if personally present, and instructs them to vote upon any matters
which may properly be acted upon at this meeting and specifically as indicated
on the reverse side of this form. Please refer to the proxy statement for a
discussion of these matters.
BY SIGNING AND DATING THIS CARD, YOU AUTHORIZE THE PROXIES TO VOTE THE PROPOSAL
AS MARKED, OR IF NOT MARKED, TO VOTE "FOR" THE PROPOSAL, AND TO USE THEIR
DISCRETION TO VOTE ANY OTHER MATTER THAT MAY PROPERLY COME BEFORE THE MEETING,
OR AT ANY POSTPONEMENT OR ADJOURNMENT THEREOF. PLEASE COMPLETE AND MAIL THIS
CARD AT ONCE IN THE ENCLOSED POSTAGE-PAID ENVELOPE.
Please vote by checking the appropriate box below:
THIS PROXY CARD IS ONLY VALID WHEN SIGNED AND DATED. TO SECURE THE LARGEST
POSSIBLE REPRESENTATION AND AVOID THE ADDITIONAL EXPENSE TO THE FUND OF
FURTHER SOLICITATION, PLEASE DATE AND SIGN NAME OR NAMES BELOW AS PRINTED ON
THIS CARD TO AUTHORIZE THE VOTING OF YOUR SHARES AS INDICATED. WHERE SHARES
ARE REGISTERED WITH JOINT OWNERS, ALL JOINT OWNERS SHOULD SIGN. PERSONS
SIGNING AS EXECUTOR, ADMINISTRATOR, TRUSTEE OR OTHER REPRESENTATIVE SHOULD
GIVE FULL TITLE AS SUCH.
Date ____________________________, 2004
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Signature(s) (Joint Owners) (PLEASE SIGN
WITHIN BOX)
1. To approve or disapprove a new Sub-Advisory Agreement FOR AGAINST ABSTAIN
between Delaware Management Company, a series of Delaware
Management Business Trust ("Delaware"), and Oberweis Asset ----- ----- -----
Management, Inc. ("Oberweis") whereby Oberweis would have
co-management responsibility for providing investment ----- ----- -----
advisory services to the Fund.
EXHIBIT A
SUB-ADVISORY AGREEMENT
AGREEMENT made by and between DELAWARE MANAGEMENT COMPANY, a series of
DELAWARE MANAGEMENT BUSINESS TRUST (the "Investment Manager") and [SUB-ADVISER
NAME] (the "Sub-Adviser").
WITNESSETH:
WHEREAS, OPTIMUM FUND TRUST (the "Trust") is an investment company
registered under the Investment Company Act of 1940, as amended (the "1940
Act"), and is organized as a statutory trust under the laws of the State of
Delaware; and
WHEREAS, [FUND NAME] (the "Fund") is a series of the Trust; and
WHEREAS, the Investment Manager and the Trust, on behalf of the Fund,
have entered into an agreement (the "Investment Management Agreement") whereby
the Investment Manager will provide investment advisory services to the Trust
with respect to the Fund; and
WHEREAS, the Investment Manager has the authority under the Investment
Management Agreement to retain one or more sub-advisers to assist the Investment
Manager in providing investment advisory services to the Trust with respect to
the Fund; and
WHEREAS, the Investment Manager and the Sub-Adviser are registered
investment advisers under the Investment Advisers Act of 1940, as amended (the
"Advisers Act"), and engage in the business of providing investment advisory
services; and
WHEREAS, the Board of Trustees (the "Board" or the "Trustees") of the
Trust and the Investment Manager desire that the Investment Manager retain the
Sub-Adviser to render investment advisory and other services with respect to
that portion of the Fund as the Investment Manager shall from time to time
allocate to the Sub-Adviser (the "Managed Portion") in the manner, for the
period, and on the terms hereinafter set forth;
NOW, THEREFORE, in consideration of the mutual covenants herein
contained, and each of the parties hereto intending to be legally bound, it is
agreed as follows:
1. (a) The Sub-Adviser will supervise and direct the investments of the assets
of the Managed Portion of each Fund listed on Schedule A attached hereto in
accordance with the Fund's investment objectives, policies, and
restrictions as provided in the Fund's Prospectus and Statement of
Additional Information, as currently in effect and as amended or
supplemented from time to time (hereinafter referred to as the
"Prospectus"), and such other limitations as the Fund may impose by notice
in writing to the Sub-Adviser, subject always to the supervision and
control of the Investment Manager and the Board.
(b) As part of the services it will provide hereunder, the Sub-Adviser is
authorized, in its discretion and without prior consultation with the Fund
or the Investment Manager to:
1
(i) obtain and evaluate information relating to investment
recommendations, asset allocation advice, industries, businesses,
securities markets, research, economic analysis, and other investment
services with respect to the securities that are included in the Managed
Portion or that are under consideration for inclusion in the Managed
Portion and invest the Managed Portion in accordance with the Investment
Manager's and the Board's written direction as more fully set forth herein
and as otherwise directed;
(ii) regularly make decisions as to what securities to purchase and
sell on behalf of the Fund with respect to the Managed Portion, effect the
purchase and sale of such investments in furtherance of the Fund's
objectives and policies, and furnish the Board with such information and
reports regarding the Sub-Adviser's activities in the performance of its
duties and obligations under this Agreement as the Investment Manager deems
appropriate or as the Board may reasonably request, including such reports,
information, and certifications as the officers of the Trust may reasonably
require in order to comply with applicable federal and state laws and
regulations;
(iii) provide any and all material composite or other performance
information, records and supporting documentation about accounts or funds
the Sub-Adviser manages, if appropriate, that are relevant to the Managed
Portion and that have investment objectives, policies, and strategies
substantially similar to those employed by the Sub-Adviser in managing the
Managed Portion that may be reasonably necessary, under applicable laws, to
allow the Fund or its agent to present information concerning the
Sub-Adviser's prior performance in the Fund's currently effective
Prospectus and Statement of Additional Information, as the same may be
hereafter modified, amended, and/or supplemented from time to time (the
"Prospectus and SAI"), and any permissible reports and materials prepared
by the Fund or its agent;
(iv) provide information as reasonably requested by the Investment
Manager or the Board to assist them or their delegate in the determination
of the fair value of certain portfolio securities when market quotations
are not readily available for the purpose of calculating the Fund's net
asset value in accordance with procedures and methods established by the
Board;
(v) vote proxies, exercise conversion or subscription rights, and
respond to tender offers and other consent solicitations ("Corporate
Actions") with respect to the issuers of securities in which Fund assets
may be invested, provided materials relating to such Corporate Actions have
been forwarded to the Sub-Adviser in a timely fashion by the Fund's
custodian or otherwise known to the Sub-Adviser, and to submit reports
regarding such Corporate Actions, including a copy of any policies
regarding such Corporate Actions, in a form reasonably satisfactory to the
Investment Manager and the Fund in order to comply with any applicable
federal or state reporting requirements;
(vi) provide performance and other information as reasonably requested
by the Investment Manager or the Board to assist them or their delegate in
conducting ongoing due diligence and performance monitoring; and
(vii) except as the Investment Manager and the Sub-Adviser may agree in
writing from time to time, maintain all accounts, books, and records with
respect to the Managed Portion as are required of an investment adviser of
a registered investment company pursuant to the 1940 Act and the Advisers
Act and the rules thereunder. The Sub-Adviser shall furnish to the
Investment Manager copies of all such accounts, books, and records as the
Investment Manager may reasonably request. The Sub-Adviser agrees that such
accounts, books, and records are the property of the Trust, and will be
surrendered to the Trust promptly upon request, with the understanding that
the Sub-Adviser may retain its own copy of all records.
2
(c) The Sub-Adviser shall not consult with any other sub-adviser of the
Fund or of any fund that is an "affiliated person" of the Fund concerning
transactions for the Fund in securities or other assets.
(d) In furnishing services hereunder, the Sub-Adviser shall be subject
to, and shall perform in accordance with, the following: (i) the Trust's
Agreement and Declaration of Trust, as the same may be hereafter modified,
amended, and/or supplemented from time to time; (ii) the Trust's By-Laws,
as the same may be hereafter modified, amended, and/or supplemented from
time to time; (iii) the Fund's Prospectus and SAI; (iv) the 1940 Act and
the Advisers Act and the rules under each and all other federal and state
securities laws or regulations applicable to the Trust and the Fund; (v)
the Trust's compliance procedures and other policies and procedures adopted
from time to time by the Board; and (vi) the written instructions of the
Investment Manager. The Investment Manager agrees to provide the
Sub-Adviser with current copies of the Trust's and the Fund's documents
mentioned above and all changes made to such documents.
(e) The Sub-Adviser hereby agrees during the period hereinafter set
forth to render the services and assume the obligations herein set forth
for the compensation herein provided. The Sub-Adviser shall for all
purposes herein be deemed to be an independent contractor, and shall,
unless otherwise expressly provided and authorized, have no authority to
act for or represent the Trust in any way, or in any way be deemed an agent
of the Trust.
2. (a) Under the terms of the Investment Management Agreement, the Trust shall
conduct its own business and affairs and shall bear the expenses and
salaries necessary and incidental thereto including, but not in limitation
of the foregoing, the costs incurred in: the maintenance of its existence
as a statutory trust organized under the laws of the State of Delaware; the
maintenance of its own books, records, and procedures; dealing with its own
shareholders; the payment of dividends; transfer of shares, including
issuance and repurchase of shares; preparation of share certificates, if
any; reports and notices to shareholders; calling and holding of
shareholders' meetings; miscellaneous office expenses; brokerage
commissions; custodian fees; legal and accounting fees; taxes; and federal
and state registration fees.
(b) Trustees, officers and employees of the Sub-Adviser may be
Trustees, officers and employees of other funds that have employed the
Sub-Adviser as sub-adviser or investment manager. Trustees, officers and
employees of the Sub-Adviser who are Trustees, officers and/or employees of
the Trust, shall not receive any compensation from the Trust for acting in
such dual capacity.
(c) In the conduct of the respective business of the parties hereto and
in the performance of this Agreement, the Trust, the Investment Manager,
and the Sub-Adviser may share facilities common to each, which may include
legal and accounting personnel, with appropriate proration of expenses
between and among them.
3. (a) The Sub-Adviser will select brokers and dealers to effect all
Fund transactions subject to the conditions set forth herein. The
Sub-Adviser will place all necessary orders with brokers, dealers, or
issuers, and will negotiate brokerage commissions, if applicable. The
Sub-Adviser is directed at all times to seek to execute transactions for
the Managed Portion (i) in accordance with any written policies, practices
or procedures that may be established by the Board or the Investment
Manager from time to time and (ii) as described in the Fund's Prospectus
3
and SAI. In placing any orders for the purchase or sale of investments for
the Fund, with respect to the Managed Portion, the Sub-Adviser shall use
its best efforts to obtain for the Managed Portion "best execution,"
considering all of the circumstances, and shall maintain records adequate
to demonstrate compliance with this requirement.
(b) Subject to the appropriate policies and procedures approved by the
Board, the Sub-Adviser may, to the extent authorized by Section 28(e) of
the Securities Exchange Act of 1934, as amended (the "Exchange Act"), cause
the Managed Portion to pay a broker or dealer that provides brokerage or
research services to the Investment Manager, the Sub-Adviser and the
Managed Portion an amount of commission for effecting a Fund transaction in
excess of the amount of commission another broker or dealer would have
charged for effecting that transaction if the Sub-Adviser determines, in
good faith, that such amount of commission is reasonable in relation to the
value of such brokerage or research services provided viewed in terms of
that particular transaction or the Sub-Adviser's overall responsibilities
to the Fund or its other advisory clients for which the Investment Manager
or the Sub-Adviser exercises investment discretion. To the extent
authorized by Section 28(e) and the Board, the Sub-Adviser shall not be
deemed to have acted unlawfully or to have breached any duty created by
this Agreement or otherwise solely by reason of such action. In addition,
subject to seeking best execution and compliance with applicable federal
and state securities laws and regulations, the Investment Manager or the
Sub-Adviser also may consider sales of shares of the Trust as a factor in
the selection of brokers and dealers. Subject to seeking best execution and
compliance with applicable federal and state securities laws and
regulations, the Board or the Investment Manager may direct the Sub-Adviser
to effect transactions in Fund securities through broker-dealers in a
manner that will help generate resources to: (i) pay the cost of certain
expenses that the Trust is required to pay or for which the Trust is
required to arrange payment; or (ii) recognize broker-dealers for the sale
of Fund shares.
(c) Any entity or person associated with the Investment Manager or the
Sub-Adviser that is a member of a national securities exchange is
authorized to effect any transaction on such exchange for the account of
the Fund to the extent and as permitted by Section 11(a)(1)(H) of the
Exchange Act.
4. As compensation for the services to be rendered to the Trust for the
benefit of the Fund by the Sub-Adviser under the provisions of this
Agreement, the Investment Manager shall pay to the Sub-Adviser a fee as
provided in Schedule A attached hereto.
5. The services to be rendered by the Sub-Adviser to the Trust for the
benefit of the Fund under the provisions of this Agreement are not to be
deemed to be exclusive, and the Sub-Adviser shall be free to render similar
or different services to others so long as its ability to render the
services provided for in this Agreement shall not be impaired thereby.
6. (a) Subject to the limitation set forth in Paragraph 5, the
Sub-Adviser, its directors, officers, employees, agents, and shareholders
may engage in other businesses, may render investment advisory services to
other investment companies, or to any other corporation, association, firm
or individual, and may render underwriting services to the Trust or to any
other investment company, corporation, association, firm or individual.
(b) Neither the Investment Manager, the Trust nor the Fund shall use the
Sub-Adviser's actual or fictitious name(s), mark, derivative and/or logo
(or that of any affiliate of the Sub-Adviser, other than that of the Fund,
the Trust, or any affiliate of the Investment Manager that is an affiliate
of the Sub-Adviser solely by reason of the Sub-Adviser's provision of
services pursuant to this Agreement) or otherwise refer to the Sub-Adviser
in any materials distributed to third parties, including the Fund's
shareholders, without prior review and written approval by the Sub-Adviser,
which may not be unreasonably withheld or delayed. Upon termination of this
Agreement, the Investment Manager,
4
the Trust and the Fund, shall, to the extent applicable and as soon as
is reasonably possible, cease to use the Sub-Adviser's actual or fictitious
name(s), mark, derivative and/or logo.
(c) The Sub-Adviser shall not use the Investment Manager's name (or that of
any affiliate of the Investment Manager) or otherwise refer to the
Investment Manager in any materials distributed to third parties, including
the Fund's shareholders, without prior review and written approval by the
Investment Manager, which may not be unreasonably withheld or delayed. Upon
termination of this Agreement, the Sub-Adviser, shall, to the extent
applicable and as soon as is reasonably possible, cease to use the actual
or fictitious name(s), mark, derivative and/or logo of the Investment
Manager, the Trust and the Fund.
7. (a) In the absence of willful misfeasance, bad faith, gross
negligence, or reckless disregard in the performance of its duties as
Sub-Adviser to the Trust on behalf of the Fund, the Sub-Adviser shall not
be liable to the Trust, the Fund, the Investment Manager or any shareholder
of the Trust for any action 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, or otherwise. The
Sub-Adviser makes no representation or warranty, express or implied, that
any level of performance or investment results will be achieved by the
Managed Portion or the Fund, or that the Managed Portion or the Fund will
perform comparably with any standard or index, including other clients of
Sub-Adviser, whether public or private.
(b) The Investment Manager shall indemnify the Sub-Adviser and its
affiliates and its or their controlling persons, officers, directors,
employees, agents, legal representatives and persons controlled by it
(which shall not include the Trust or the Fund) (collectively, "Sub-Adviser
Related Persons") to the fullest extent permitted by law against any and
all loss, damage, judgments, fines, amounts paid in settlement and
reasonable expenses, including attorneys' fees, (collectively "Losses")
incurred by the Sub-Adviser or Sub-Adviser Related Persons arising from or
in connection with this Agreement or the performance by the Sub-Adviser or
Sub-Adviser Related Persons of its or their duties hereunder so long as
such Losses arise out of the Investment Manager's willful misfeasance, bad
faith, gross negligence, or reckless disregard in performing its
responsibilities hereunder, including, without limitation, such Losses
arising under any applicable law or that may be based upon any untrue
statement of a material fact contained in the Trust's Registration
Statement, or any amendment thereof or any supplement thereto, or the
omission to state therein a material fact that was known or that should
have been known and was required to be stated therein or necessary to make
the statements therein not misleading, unless such statement or omission
was made in reasonable reliance upon information furnished to the
Investment Manager or the Trust by the Sub-Adviser or a Sub-Adviser Related
Person specifically for inclusion in the Registration Statement or any
amendment thereof or supplement thereto, except to the extent any such
Losses referred to in this paragraph (b) result from willful misfeasance,
bad faith, gross negligence or reckless disregard on the part of the
Sub-Adviser or a Sub-Adviser Related Person in the performance of any of
its duties under, or in connection with, this Agreement.
(c) The Sub-Adviser shall indemnify the Investment Manager and its
affiliates and its or their controlling persons, officers, directors,
employees, agents, legal representatives and persons controlled by it
(collectively, "Investment Manager Related Persons") to the fullest extent
permitted by law against any and all Losses incurred by the Investment
Manager or Investment Manager Related Persons arising from or in connection
with this Agreement or the performance by the Investment Manager or
5
Investment Manager Related Persons of its or their duties hereunder so long
as such Losses arise out of the Sub-Adviser's willful misfeasance, bad
faith, gross negligence, or reckless disregard in performing its
responsibilities hereunder, including, without limitation, such Losses
arising under any applicable law or that may be based upon any untrue
statement of a material fact contained in the Trust's Registration
Statement, or any amendment thereof or any supplement thereto, or the
omission to state therein a material fact that was known or that should
have been known and was required to be stated therein or necessary to make
the statements therein not misleading, if such statement or omission was
made in reasonable reliance upon information furnished to the Investment
Manager or the Trust by the Sub-Adviser or a Sub-Adviser Related Person
specifically for inclusion in the Registration Statement or any amendment
thereof or supplement thereto, except to the extent any such Losses
referred to in this paragraph (c) result from willful misfeasance, bad
faith, gross negligence or reckless disregard on the part of the Investment
Manager or an Investment Manager Related Person in the performance of any
of its duties under, or in connection with, this Agreement.
8. (a) This Agreement shall be executed and become effective as of the
date written below; provided, however, that this Agreement shall not become
effective with respect to the Fund unless it has first been approved in the
manner required by the 1940 Act and the rules thereunder or in accordance
with exemptive or other relief granted by the Securities and Exchange
Commission (the "SEC") or its staff. This Agreement shall continue in
effect for a period of two (2) years and may be renewed thereafter only so
long as such renewal and continuance is specifically approved at least
annually by the Board or by the vote of a majority of the outstanding
voting securities of the Fund and only if the terms and the renewal hereof
have been approved by the vote of a majority of those Trustees of the Trust
who are not parties hereto or "interested persons" of the Trust, the Fund,
or any party hereto, cast in person at a meeting called for the purpose of
voting on such approval.
(b) No amendment to this Agreement shall be effective unless approved in
the manner required by the 1940 Act and the rules thereunder or in
accordance with exemptive or other relief granted by the SEC or its staff.
(c) This Agreement may be terminated by the Investment Manager or the Trust
at any time, without the payment of a penalty, on written notice to the
Sub-Adviser of the Investment Manager's or the Trust's intention to do so,
in the case of the Trust pursuant to action by the Board or pursuant to the
vote of a majority of the outstanding voting securities of the Fund. The
Sub-Adviser may terminate this Agreement at any time, without the payment
of a penalty, on sixty (60) days' written notice to the Investment Manager
and the Trust of its intention to do so. Upon termination of this
Agreement, the obligations of all the parties hereunder shall cease and
terminate as of the date of such termination, except for (i) any obligation
to respond for a breach of this Agreement committed prior to such
termination, (ii) the obligation of the Investment Manager to pay to the
Sub-Adviser the fee provided in Paragraph 4 hereof, prorated to the date of
termination, and (iii) any indemnification obligation provided in Paragraph
7 hereof. This Agreement shall automatically terminate in the event of its
assignment. This Agreement shall automatically terminate upon the
termination of the Investment Management Agreement.
9. Any information and advice furnished by any party to this Agreement
to the other party or parties shall be treated as confidential and shall
not be disclosed to third parties without the consent of the other party
hereto except as required by law, rule or regulation. Notwithstanding the
foregoing, information shall not be subject to such confidentiality
obligations if it:
(i) is already known to the receiving party at the time it is
obtained;
6
(ii) is or becomes publicly known or available through no wrongful
act of the receiving party;
(iii) is rightfully received from a third party who, to the best of
the receiving party's knowledge, is not under a duty of
confidentiality;
(iv) is released by the protected party to a third party without
restriction;
(v) is required to be disclosed by the receiving pursuant to a
requirement of a court order, subpoena, governmental or
regulatory agency or law (provided the receiving party will
provide the other party written notice of such requirement, to
the extent such notice is permitted);
(vi) is relevant to the defense of any claim or cause of action
asserted against the receiving party; or
(vii) has been or is independently developed or obtained by the
receiving party.
The Sub-Adviser shall not disclose any "nonpublic personal information" (as such
term is defined in Regulation S-P, including any amendments thereto) pertaining
to the customers of the Trust or a client of the Investment Manager to any third
party or use such information other than for the purpose of providing the
services contemplated by this Agreement.
10. The Sub-Adviser represents, warrants and agrees that:
(a) The Sub-Adviser: (i) is registered as an investment adviser under
the Advisers Act and will continue to be so registered for so long as this
Agreement remains in effect; (ii) is not prohibited by the 1940 Act, the
Advisers Act or other law, regulation or order from performing the services
contemplated by this Agreement; (iii) to the best of its knowledge, has met
and will seek to continue to meet for so long as this Agreement remains in
effect, any other applicable federal or state requirements, or the
applicable requirements of any regulatory or industry self-regulatory
agency necessary to be met in order to perform the services contemplated by
this Agreement; (iv) has the authority to enter into and perform the
services contemplated by this Agreement; and (v) will promptly notify the
Investment Manager of the occurrence of any event that would disqualify the
Sub-Adviser from serving as an investment adviser of an investment company
pursuant to Section 9(a) of the 1940 Act or otherwise. The Sub-Adviser will
also promptly notify the Fund and the Investment Manager if it is served or
otherwise receives notice of any action, suit, proceeding, inquiry or
investigation, at law or in equity, before or by any court, public board or
body, involving the affairs of the Fund, provided, however, that routine
regulatory examinations shall not be required to be reported by this
provision.
(b) The Sub-Adviser has adopted a written code of ethics complying with
the requirements of Rule 17j-1 under the 1940 Act and will provide the
Investment Manager and the Board with a copy of such code of ethics,
together with evidence of its adoption. In accordance with the requirements
of Rule 17j-1, the Sub-Adviser shall certify to the Investment Manager that
the Sub-Adviser has complied in all material respects with the requirements
of Rule 17j-1 during the previous year and that there has been no material
violation of the Sub-Adviser's code of ethics relating to the services the
Sub-Adviser performs under this Agreement or, if such a material violation
has occurred, that appropriate action was taken in response to such
violation. Upon the written request of the Investment Manager, the
Sub-Adviser shall provide to the Investment Manager, its employees or its
agents all information required by Rule 17j-1(c)(1) relating to the
approval by the Fund's Board of Trustees of the Sub-Adviser's code of
ethics relating to the services the Sub-Adviser performs under this
Agreement.
7
(c) The Sub-Adviser has provided the Trust and the Investment Manager
with a copy of its Form ADV at least forty-eight (48) hours prior to
execution of this Agreement, which as of the date of this Agreement is its
Form ADV as most recently filed with the SEC and promptly will furnish a
copy of all amendments to the Trust and the Investment Manager at least
annually. Such amendments shall reflect all changes in the Sub-Adviser's
organizational structure, professional staff or other significant
developments affecting the Sub-Adviser, as required by the Advisers Act.
(d) The Sub-Adviser will notify the Trust and the Investment Manager of
any assignment of this Agreement or change of control of the Sub-Adviser,
as applicable, and any changes in the key personnel who are the portfolio
manager(s) of the Managed Portion prior to or promptly after such change.
The Sub-Adviser agrees to bear all reasonable expenses of the Fund, if any,
arising out of an assignment or change in control of the Sub-Adviser.
(e) The Sub-Adviser agrees to maintain an appropriate level of errors
and omissions or professional liability insurance coverage.
11. This Agreement shall extend to and bind the successors of the
parties hereto.
12. For the purposes of this Agreement, the terms "vote of a majority
of the outstanding voting securities," "interested person," "affiliated
person," and "assignment" shall have the meanings given them in the 1940
Act.
8
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
signed by their duly authorized officers and duly attested as of the _____ day
of __________, 2004.
DELAWARE MANAGEMENT COMPANY,
a series of DELAWARE MANAGEMENT
BUSINESS TRUST
By:________________________________ By:_______________________________
Name: Name:
Title: Title:
Attest:____________________________ Attest:___________________________
Agreed to and accepted as of the day and year first above written:
OPTIMUM FUND TRUST
on behalf of
By:__________________________________
Attest:________________________________
9
SCHEDULE A
TO
SUB-ADVISORY AGREEMENT
______________
FEE SCHEDULE
______________
The compensation payable to Sub-Adviser for its services to Paragraph 4
of the Sub-Advisory Agreement shall be calculated and paid as follows:
The total fee will be the sum of the following percentages (on an
annual basis) of the total assets within the Managed Portion(s)
sub-advised by Sub-Adviser:
0.__% (__ basis points) of the first $___ million within the Managed
Portion(s)
0.__% (__ basis points) of the next $___ million within the Managed
Portion(s)
0.__% (__ basis points) of all assets above $___ million within the
Managed Portion(s)
The fee shall be payable on the Managed Portion's average daily net assets
monthly to the Sub-Adviser on or before the tenth (10th) day of the next
succeeding calendar month. If this Agreement becomes effective or terminates
before the end of any month, the investment management fee for the period from
the effective date to the end of such month or from the beginning of such month
to the date of termination, as the case may be, shall be prorated according to
the proration which such period bears to the full month in which such
effectiveness or termination occurs. Each month, the Investment Manager will
provide the Sub-Adviser with a worksheet accompanying payment of the
sub-advisory fee that sets forth the computation of such sub-advisory fee.