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OMB Number: 3235-0570
Expires: August 31, 2011
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hours per response: 18.9
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED
MANAGEMENT INVESTMENT COMPANIES
Investment Company Act file number 811-09000
--------------------------------------------
Oak Value Trust
- --------------------------------------------------------------------------------
(Exact name of registrant as specified in charter)
1450 Raleigh Road, Suite 220 Chapel Hill, North Carolina 27517
- --------------------------------------------------------------------------------
(Address of principal executive offices) (Zip code)
Larry D. Coats, Jr.
Oak Value Capital Management, Inc. 1450 Raleigh Road Chapel Hill, NC 27707
- --------------------------------------------------------------------------------
(Name and address of agent for service)
Registrant's telephone number, including area code: (919) 419-1900
---------------------------
Date of fiscal year end: June 30, 2009
-----------------------------
Date of reporting period: December 31, 2008
-----------------------------
Form N-CSR is to be used by management investment companies to file reports with
the Commission not later than 10 days after the transmission to stockholders of
any report that is required to be transmitted to stockholders under Rule 30e-1
under the Investment Company Act of 1940 (17 CFR 270.30e-1). The Commission may
use the information provided on Form N-CSR in its regulatory, disclosure review,
inspection, and policymaking roles.
A registrant is required to disclose the information specified by Form N-CSR,
and the Commission will make this information public. A registrant is not
required to respond to the collection of information contained in Form N-CSR
unless the Form displays a currently valid Office of Management and Budget
("OMB") control number. Please direct comments concerning the accuracy of the
information collection burden estimate and any suggestions for reducing the
burden to Secretary, Securities and Exchange Commission, 450 Fifth Street, NW,
Washington, DC 20549-0609. The OMB has reviewed this collection of information
under the clearance requirements of 44 U.S.C. ss. 3507.
ITEM 1. REPORTS TO STOCKHOLDERS.
SEMI-ANNUAL REPORT
DECEMBER 31, 2008
(UNAUDITED)
[LOGO OMITTED]
==============
OAK VALUE FUND
--------------
WWW.OAKVALUEFUND.COM
LETTER TO SHAREHOLDERS January 27, 2009
================================================================================
Dear Fellow Oak Value Fund Shareholders,
The Oak Value Fund (the "Fund") posted a loss of 24.36% for the six month period
ended December 31, 2008 as compared to a loss of 28.48% for the S&P 500 Index.
The pain of this outcome is perhaps somewhat dampened by the fact that the
Fund's portfolio fared better than the market overall and many of its
like-minded peers. In history's most widely taught treatise of wartime
engagement, The Art of War, SunTzu writes "ALL ARMIES PREFER HIGH GROUND TO LOW
AND SUNNY PLACES TO DARK." As we reflect upon the first half of the Fund's
fiscal year, this quote is particularly relevant. There is no doubt that 2008
was a battleground for most investors, but our experience has provided us with a
good definition of our "high ground." The recent market turmoil has only served
to reinforce our longstanding belief that the Fund and its shareholders are best
served by focusing our time, resources and capital on advantaged businesses.
When asked for our market forecasts, we invariably disappoint. We simply do not
attempt to predict the market, nor do we invest in a way that contemplates
catching updrafts or avoiding downdrafts. Neither do we let a quantitative model
dictate our investment decisions. Instead, we focus on businesses. We seek to
manage risk the same way that the management teams that run the businesses in
the Fund's portfolio manage risk - through a thorough understanding of the
underlying businesses. We do not ignore the economy, but we concentrate on what
we believe ought to happen over the long term, based on highly conservative
assumptions. Within this framework, we remain opportunistic buyers of businesses
built on high ground - those we believe are advantaged both competitively and
economically.
In the area of non-portfolio related developments, we are pleased to report that
effective November 1, 2008, Christy L. Philips was appointed co-manager of the
Fund, joining David R. Carr and Larry D. Coats in managing the Fund's portfolio.
Christy joined the adviser five years ago and has proven to be a valuable
addition to our team. She is a seasoned investor with a wonderful combination of
experience, intelligence and temperament. We are also pleased to report that the
Fund was recently added to three of Merrill Lynch's investment platforms and is
now available to clients of the more than 16,000 Merrill Lynch professional
financial advisers.
We have included the Fund's financial statements for the six month period ended
December 31, 2008 as well as other financial and portfolio data in the pages
that follow. A detailed summary of the Fund's investment activities is provided
in the Investment Adviser's Review posted on the Fund's website -
www.oakvaluefund.com. We encourage you to review this and other information
posted to the site on a regular basis. For your convenience, we have established
an electronic mailing list to efficiently provide information to Fund
shareholders and
1
prospective shareholders. Investors interested in receiving information from the
Fund in electronic form may subscribe to this service at the following URL
address: www.oakvaluefund.com/mail.aspx.
We thank you for your continued interest and partnership and welcome your
questions and comments.
Oak Value Fund Co-Managers,
/s/ David R. Carr, Jr. /s/ Larry D. Coats, Jr. /s/ Christy L. Phillips
David R. Carr, Jr. Larry D. Coats, Jr. Christy L. Phillips
Note: Please see Important Information section of this report for disclosure
that applies to this letter.
=================================================================================================================
TOP TEN HOLDINGS AS OF DECEMBER 31, 2008(1)
=================================================================================================================
COMPANY PRIMARY BUSINESS S&P SECTOR
- -----------------------------------------------------------------------------------------------------------------
3M Co. Manufacturing & Marketing Industrials
Technology Products/Services
- -----------------------------------------------------------------------------------------------------------------
AFLAC, Inc. Supplemental Health and Life Insurance Financials
- -----------------------------------------------------------------------------------------------------------------
Avon Products, Inc. Cosmetics and Fragrance Consumer Staples
Manufacturer and Marketer
- -----------------------------------------------------------------------------------------------------------------
Berkshire Hathaway, Inc. - Class A Insurance, Reinsurance & Capital Allocation Financials
- -----------------------------------------------------------------------------------------------------------------
Cadbury PLC - ADR Confectioneries Consumer Staples
- -----------------------------------------------------------------------------------------------------------------
Coach, Inc. Handbags and Accessories Consumer Discretionary
- -----------------------------------------------------------------------------------------------------------------
Diageo PLC - ADR Global Premium Alcohol Business Consumer Staples
- -----------------------------------------------------------------------------------------------------------------
Microsoft Corp. Computer Software Developer and Manufacturer Information Technology
- -----------------------------------------------------------------------------------------------------------------
Oracle Corp. Database, Middleware, & Application Software Information Technology
- -----------------------------------------------------------------------------------------------------------------
Praxair, Inc. Industrial Use Atmospheric & Process Gases Materials
- -----------------------------------------------------------------------------------------------------------------
(1) Top Ten Holdings are presented to illustrate examples of the securities in
which the Fund may invest. Because they are presented as of the dates
indicated and change from time to time, they may not be representative of
the Fund's current or future investments. Top Ten Holdings do not include
money market instruments.
- --------------------------------------------------------------------------------
2
====================================================================================================
JULY 1, 2008 - DECEMBER 31, 2008 POSITIONS ADDED
====================================================================================================
COMPANY PURCHASED PRIMARY BUSINESS SECTOR CLASSIFICATION
- ----------------------------------------------------------------------------------------------------
Avon Products, Inc. Cosmetics and Fragrance Consumer Staples
Manufacturer and Marketer
- ----------------------------------------------------------------------------------------------------
Chesapeake Energy Corp. Oil and Natural Gas Exploration Energy
and Production
- ----------------------------------------------------------------------------------------------------
MasterCard, Inc. - Class A Credit and Debit Card Transaction Information Technology
and Processing Services
- ----------------------------------------------------------------------------------------------------
Syngenta AG - ADR Crop Protection and Commercial Materials
Seed Business
- ----------------------------------------------------------------------------------------------------
Zimmer Holdings, Inc. Orthopedic Reconstructive Implants Health Care
====================================================================================================
JULY 1, 2008 - DECEMBER 31, 2008 POSITIONS ELIMINATED
====================================================================================================
COMPANY SOLD PRIMARY BUSINESS SECTOR CLASSIFICATION
- ----------------------------------------------------------------------------------------------------
Apollo Group, Inc. - Class A Education and Training Services Consumer Discretionary
- ----------------------------------------------------------------------------------------------------
Capital One Financial Corp. Financial Products and Services Financials
- ----------------------------------------------------------------------------------------------------
E.I. du Pont de Nemours and Co. Chemicals Materials
- ----------------------------------------------------------------------------------------------------
E.W. Scripps Co. - Class A Broadcasting and Print Media Consumer Discretionary
- ----------------------------------------------------------------------------------------------------
Fidelity National Financial Transaction Processing Information Technology
Information Services, Inc.
- ----------------------------------------------------------------------------------------------------
Lender Processing Services, Inc. Information and Data Services to Information Technology
the Mortgage Lending Industry
- ----------------------------------------------------------------------------------------------------
Viacom, Inc. - Class B Broadcasting, Entertainment, Consumer Discretionary
& Online Media
- ----------------------------------------------------------------------------------------------------
IMPORTANT INFORMATION:
THE OAK VALUE FUND IS DISTRIBUTED BY ULTIMUS FUND DISTRIBUTORS, LLC. THE
INFORMATION PRESENTED ABOVE IS NOT TO BE CONSTRUED AS AN OFFER OR SOLICITATION
TO PURCHASE THE OAK VALUE FUND (THE "FUND"), WHICH IS OFFERED ONLY BY
PROSPECTUS. AN INVESTOR SHOULD CONSIDER THE INVESTMENT OBJECTIVES, RISKS,
CHARGES AND EXPENSES OF THE FUND CAREFULLY BEFORE INVESTING. THE FUND'S
PROSPECTUS CONTAINS THIS AND OTHER IMPORTANT INFORMATION. TO OBTAIN A COPY OF
THE OAK VALUE FUND'S PROSPECTUS PLEASE VISIT OUR WEBSITE AT WWW.OAKVALUEFUND.COM
OR CALL 1-800-622-2472 AND A COPY WILL BE SENT TO YOU FREE OF CHARGE. PLEASE
READ THE PROSPECTUS CAREFULLY BEFORE YOU INVEST.
3
OAK VALUE FUND
PERFORMANCE INFORMATION (UNAUDITED)
================================================================================
COMPARISON OF THE CHANGE IN VALUE OF A $10,000 INVESTMENT
IN THE OAK VALUE FUND AND THE S&P 500 INDEX
[LINE GRAPH OMITTED]
OAK VALUE FUND S&P 500 INDEX
--------------- --------------
DATE VALUE DATE VALUE
---- ------- ---- -------
12/31/98 $ 10,000 12/31/98 $ 10,000
06/30/99 10,551 06/30/99 11,238
12/31/99 9,688 12/31/99 12,104
06/30/00 9,717 06/30/00 12,053
12/31/00 11,448 12/31/00 11,002
06/30/01 11,983 06/30/01 10,265
12/31/01 11,394 12/31/01 9,694
06/30/02 9,969 06/30/02 8,419
12/31/02 8,621 12/31/02 7,552
06/30/03 10,233 06/30/03 8,440
12/31/03 11,389 12/31/03 9,718
06/30/04 11,609 06/30/04 10,053
12/31/04 12,297 12/31/04 10,776
06/30/05 12,329 06/30/05 10,689
12/31/05 12,129 12/31/05 11,305
06/30/06 12,124 06/30/06 11,611
12/31/06 13,848 12/31/06 13,091
06/30/07 15,159 06/30/07 14,001
12/31/07 14,523 12/31/07 13,810
06/30/08 12,728 06/30/08 12,164
12/31/08 9,627 12/31/08 8,700
PAST PERFORMANCE IS NOT PREDICTIVE OF FUTURE PERFORMANCE.
- ------------------------------------------------------------------------------------------------------------------------------------
CUMULATIVE TOTAL RETURNS(A)
- ------------------------------------------------------------------------------------------------------------------------------------
Calendar Calendar Calendar Calendar Calendar Calendar Calendar Calendar Calendar Calendar Since Inception*
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 (as of 12/31/08)
Oak Value Fund -3.12% 18.17% -0.47% -24.34% 32.11% 7.97% -1.37% 14.18% 4.87% -33.71% 214.92%(B)
S&P 500 Index 21.04% -9.10% -11.89% -22.10% 28.68% 10.88% 4.91% 15.79% 5.49% -37.00% 180.51%(B)
- ------------------------------------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
AVERAGE ANNUAL TOTAL RETURNS(A)
- --------------------------------------------------------------------------------
FOR THE PERIODS ENDED DECEMBER 31, 2008
- --------------------------------------------------------------------------------
ONE THREE FIVE TEN SINCE
YEAR YEARS YEARS YEARS INCEPTION*
- --------------------------------------------------------------------------------
Oak Value Fund............. -33.71% -7.41% -3.31% -0.38% 7.46%
S&P 500 Index.............. -37.00% -8.36% -2.19% -1.38% 6.68%
- --------------------------------------------------------------------------------
* Inception date of the Oak Value Fund was January 18, 1993.
(A) The returns shown do not reflect the deduction of taxes a shareholder
would pay on Fund distributions or the redemption of Fund shares.
(B) Not annualized.
4
OAK VALUE FUND
PORTFOLIO INFORMATION
DECEMBER 31, 2008 (UNAUDITED)
================================================================================
DISTRIBUTION BY BUSINESS CATEGORY (% OF NET ASSETS)
[PIE CHART OMITTED]
Consumer Related 29.5%
Energy 2.2%
Finance Related 25.3%
Health Care 7.0%
Industrials 10.1%
Information Technology 16.2%
Materials 8.5%
Cash Equivalents 1.2%
TEN LARGEST HOLDINGS
COMPANY % OF NET ASSETS
- -----------------------------------------------------------------
Berkshire Hathaway, Inc. - Class A 9.11%
Avon Products, Inc. 6.41%
Praxair, Inc. 6.13%
Diageo PLC - ADR 6.09%
AFLAC, Inc. 6.04%
3M Co. 5.53%
Coach, Inc. 5.46%
Cadbury PLC - ADR 5.38%
Oracle Corp. 4.73%
Microsoft Corp. 4.65%
5
OAK VALUE FUND
SCHEDULE OF INVESTMENTS
DECEMBER 31, 2008 (UNAUDITED)
================================================================================
SHARES COMMON STOCKS -- 98.8% VALUE
- --------------------------------------------------------------------------------
CONSUMER DISCRETIONARY -- 11.6%
164,425 Coach, Inc. (a).......................................... $ 3,415,107
67,645 Scripps Networks Interactive, Inc. - Class A............. 1,488,190
99,750 Tiffany & Co. ........................................... 2,357,093
-----------
7,260,390
-----------
CONSUMER STAPLES -- 17.9%
166,875 Avon Products, Inc....................................... 4,010,006
94,373 Cadbury PLC - ADR........................................ 3,366,285
67,125 Diageo PLC - ADR......................................... 3,808,673
-----------
11,184,964
-----------
ENERGY -- 2.2%
83,225 Chesapeake Energy Corp................................... 1,345,748
-----------
FINANCIALS -- 25.3%
82,450 AFLAC, Inc............................................... 3,779,508
95,500 American Express Co. .................................... 1,771,525
56,450 AON Corp................................................. 2,578,636
59 Berkshire Hathaway, Inc. - Class A (a)................... 5,699,400
100,450 Moody's Corp............................................. 2,018,041
-----------
15,847,110
-----------
HEALTH CARE -- 7.0%
82,675 Medtronic, Inc........................................... 2,597,648
43,900 Zimmer Holdings, Inc. (a)................................ 1,774,438
-----------
4,372,086
-----------
INDUSTRIALS -- 10.1%
60,050 3M Co.................................................... 3,455,277
53,175 United Technologies Corp. ............................... 2,850,180
-----------
6,305,457
-----------
INFORMATION TECHNOLOGY -- 16.2%
135,075 Cisco Systems, Inc. (a).................................. 2,201,722
25,000 eBay, Inc. (a)........................................... 349,000
12,175 MasterCard, Inc. - Class A .............................. 1,740,173
149,725 Microsoft Corp. ......................................... 2,910,654
166,675 Oracle Corp. (a)......................................... 2,955,148
-----------
10,156,697
-----------
MATERIALS -- 8.5%
64,550 Praxair, Inc. ........................................... 3,831,688
37,875 Syngenta AG - ADR........................................ 1,482,427
-----------
5,314,115
-----------
TOTAL COMMON STOCKS (Cost $73,021,192)................... $61,786,567
-----------
6
OAK VALUE FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
================================================================================
SHARES CASH EQUIVALENTS -- 0.1% VALUE
- --------------------------------------------------------------------------------
59,429 First American Government Obligations Fund -
Class Y, 0.68% (b) (Cost $59,429)........................ $ 59,429
-----------
TOTAL INVESTMENTS AT VALUE -- 98.9% (Cost $73,080,621)... $61,845,996
OTHER ASSETS IN EXCESS OF LIABILITIES -- 1.1%............ 683,221
-----------
NET ASSETS -- 100.0%..................................... $62,529,217
===========
(a) Non-income producing security.
(b) Variable rate security. The rate shown is the 7-day effective yield as of
December 31, 2008.
ADR - American Depositary Receipt
See accompanying notes to financial statements.
7
OAK VALUE FUND
STATEMENT OF ASSETS AND LIABILITIES
DECEMBER 31, 2008 (UNAUDITED)
================================================================================
ASSETS
Investments in securities:
At cost ..................................................... $ 73,080,621
============
At market value (Note 1) .................................... $ 61,845,996
Receivable for investment securities sold ...................... 749,188
Receivable for capital shares sold ............................. 15,233
Dividends receivable ........................................... 41,147
Other assets ................................................... 39,619
------------
TOTAL ASSETS ................................................ 62,691,183
------------
LIABILITIES
Dividends payable .............................................. 1,050
Payable for capital shares redeemed ............................ 100,280
Accrued investment advisory fees (Note 3) ...................... 48,236
Payable to administrator (Note 3) .............................. 12,400
------------
TOTAL LIABILITIES ........................................... 161,966
------------
NET ASSETS ..................................................... $ 62,529,217
============
Net assets consist of:
Paid-in capital ................................................ $ 73,665,970
Accumulated net investment income .............................. 520
Accumulated net realized gains from security transactions ...... 97,352
Net unrealized depreciation on investments ..................... (11,234,625)
------------
Net assets ..................................................... $ 62,529,217
============
Shares of beneficial interest outstanding
(unlimited number of shares authorized, no par value) ..... 4,303,571
============
Net asset value, offering price and redemption price per share (A) $ 14.53
============
(A) Redemption price may differ from the net asset value per share depending
upon the length of time the shares are held (Note 1).
See accompanying notes to financial statements.
8
OAK VALUE FUND
STATEMENT OF OPERATIONS
FOR THE SIX MONTHS ENDED DECEMBER 31, 2008 (UNAUDITED)
================================================================================
INVESTMENT INCOME
Dividends ...................................................... $ 647,450
------------
EXPENSES
Investment advisory fees (Note 3) .............................. 362,975
Transfer agent and shareholder services fees (Note 3) .......... 50,292
Trustees' fees and expenses .................................... 47,980
Administration fees (Note 3) ................................... 36,270
Professional fees .............................................. 29,681
Fund accounting fees (Note 3) .................................. 15,934
Insurance expense .............................................. 13,778
Registration fees .............................................. 10,767
Compliance service fees (Note 3) ............................... 9,000
Printing of shareholder reports ................................ 8,649
Custody and bank service fees .................................. 7,226
Interest expense (Note 4) ...................................... 68
Other expenses ................................................. 10,384
------------
TOTAL EXPENSES .............................................. 603,004
------------
NET INVESTMENT INCOME .......................................... 44,446
------------
REALIZED AND UNREALIZED GAINS (LOSSES) ON INVESTMENTS
Net realized gains from security transactions .................. 198,138
Net change in unrealized appreciation/depreciation on investments (22,150,154)
------------
NET REALIZED AND UNREALIZED LOSSES ON INVESTMENTS .............. (21,952,016)
------------
NET DECREASE IN NET ASSETS FROM OPERATIONS ..................... $(21,907,570)
============
See accompanying notes to financial statements.
9
OAK VALUE FUND
STATEMENTS OF CHANGES IN NET ASSETS
=======================================================================================
SIX MONTHS
ENDED YEAR
DECEMBER 31, ENDED
2008 JUNE 30,
(UNAUDITED) 2008
- ---------------------------------------------------------------------------------------
FROM OPERATIONS
Net investment income (loss) .................... $ 44,446 $ (99,216)
Net realized gains from security transactions ... 198,138 13,297,916
Net change in unrealized
appreciation/depreciation on investments .... (22,150,154) (32,835,797)
-------------- --------------
Net decrease in net assets from operations ......... (21,907,570) (19,637,097)
-------------- --------------
DISTRIBUTIONS TO SHAREHOLDERS
From net investment income ...................... (43,926) --
From net realized gains
from security transactions .................. (182,701) (13,111,978)
-------------- --------------
Decrease in net assets from
distributions to shareholders ................... (226,627) (13,111,978)
-------------- --------------
FROM CAPITAL SHARE TRANSACTIONS
Proceeds from shares sold ....................... 1,198,673 4,383,470
Reinvestment of distributions to shareholders ... 221,420 12,789,625
Proceeds from redemption fees collected (Note 1). 4,025 5,060
Payments for shares redeemed .................... (10,501,749) (33,027,500)
-------------- --------------
Net decrease in net assets from
capital share transactions ...................... (9,077,631) (15,849,345)
-------------- --------------
NET DECREASE IN NET ASSETS ......................... (31,211,828) (48,598,420)
NET ASSETS
Beginning of period ............................. 93,741,045 142,339,465
-------------- --------------
End of period ................................... $ 62,529,217 $ 93,741,045
============== ==============
ACCUMULATED NET INVESTMENT INCOME .................. $ 520 $ --
============== ==============
SUMMARY OF CAPITAL SHARE ACTIVITY
Shares sold ..................................... 72,869 191,644
Shares reinvested ............................... 15,964 588,072
Shares redeemed ................................. (647,511) (1,433,786)
-------------- --------------
Net decrease in shares outstanding .............. (558,678) (654,070)
Shares outstanding, beginning of period ......... 4,862,249 5,516,319
-------------- --------------
Shares outstanding, end of period ............... 4,303,571 4,862,249
============== ==============
See accompanying notes to financial statements.
10
OAK VALUE FUND
FINANCIAL HIGHLIGHTS
PER SHARE DATA FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD
==============================================================================================================================
SIX MONTHS
ENDED YEAR YEAR YEAR YEAR YEAR
DECEMBER 31, ENDED ENDED ENDED ENDED ENDED
2008 JUNE 30, JUNE 30, JUNE 30, JUNE 30, JUNE 30,
(UNAUDITED) 2008 2007 2006 2005 2004
- ------------------------------------------------------------------------------------------------------------------------------
Net asset value at
beginning of period .......... $ 19.28 $ 25.80 $ 28.00 $ 30.82 $ 29.02 $ 25.58
---------- ---------- ---------- ---------- ---------- ----------
Income (loss) from investment
operations:
Net investment income (loss) 0.01 (0.02) (0.05) 0.08 (0.12) (0.15)
Net realized and unrealized
gains (losses) on
investments .............. (4.71) (3.87) 6.61 (0.60) 1.92 3.59
---------- ---------- ---------- ---------- ---------- ----------
Total from investment operations (4.70) (3.89) 6.56 (0.52) 1.80 3.44
---------- ---------- ---------- ---------- ---------- ----------
Less distributions:
From net investment income . (0.01) -- (0.00)(A) (0.08) -- --
From net realized gains from
security transactions .... (0.04) (2.63) (8.77) (2.22) -- --
---------- ---------- ---------- ---------- ---------- ----------
Total distributions ............ (0.05) (2.63) (8.77) (2.30) -- --
---------- ---------- ---------- ---------- ---------- ----------
Proceeds from redemption fees
collected (Note 1) ........... 0.00(A) 0.00(A) 0.01 0.00(A) 0.00(A) 0.00(A)
---------- ---------- ---------- ---------- ---------- ----------
Net asset value at end of period $ 14.53 $ 19.28 $ 25.80 $ 28.00 $ 30.82 $ 29.02
========== ========== ========== ========== ========== ==========
Total return (B) ............... (24.36%)(C) (16.04%) 25.03% (1.66%) 6.20% 13.45%
========== ========== ========== ========== ========== ==========
Net assets at end of period
(000's) ...................... $ 62,529 $ 93,741 $ 142,339 $ 201,024 $ 248,782 $ 259,488
========== ========== ========== ========== ========== ==========
Ratio of expenses to
average net assets ........... 1.49%(D) 1.37% 1.35% 1.29% 1.25% 1.25%
Ratio of net investment income
(loss) to average net assets . 0.11%(D) (0.08%) (0.16%) 0.24% (0.39%) (0.52%)
Portfolio turnover rate ........ 20%(C) 52% 44% 29% 29% 24%
(A) Amount rounds to less than $0.01 per share.
(B) Total return is a measure of the change in value of an investment in the
Fund over the periods covered, which assumes any dividends or capital
gains distributions are reinvested in shares of the Fund. Returns shown do
not reflect the deduction of taxes a shareholder would pay on Fund
distributions or the redemption of Fund shares.
(C) Not annualized.
(D) Annualized.
See accompanying notes to financial statements.
11
OAK VALUE FUND
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2008 (UNAUDITED)
================================================================================
1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES
The Oak Value Fund (the "Fund") is a diversified series of Oak Value Trust (the
"Trust"). The Trust, registered as an open-end management investment company
under the Investment Company Act of 1940, was organized as a Massachusetts
business trust on March 3, 1995. The Fund began operations on January 18, 1993
as a series of the Albemarle Investment Trust.
The Fund's investment objective is to seek capital appreciation primarily
through investments in equity securities, consisting of common and preferred
stocks and securities convertible into common stocks traded in domestic and
foreign markets.
The following is a summary of the Fund's significant accounting policies:
SECURITIES VALUATION -- The Fund's portfolio securities are valued as of the
close of business of the regular session of the principal exchange where the
security is traded. Securities traded on a national stock exchange are valued
based upon the closing price on the principal exchange where the security is
traded. Securities which are quoted by NASDAQ are valued at the NASDAQ Official
Closing Price. Securities which are traded over-the-counter are valued at the
last sales price, if available, otherwise, at the last quoted bid price. In the
event that market quotations are not readily available, securities are valued at
fair value as determined in accordance with procedures adopted in good faith by
the Board of Trustees. Such methods of fair valuation may include, but are not
limited to: multiple of earnings, discount from market of a similar freely
traded security, or a combination of these or other methods. The fair value of
securities with remaining maturities of 60 days or less has been determined in
good faith by the Board of Trustees to be represented by amortized cost value,
absent unusual circumstances.
The Financial Accounting Standards Board's ("FASB") Statement on Financial
Accounting Standards No. 157 "Fair Value Measurements" establishes a single
authoritative definition of fair value, sets out a framework for measuring fair
value and requires additional disclosures about fair value measurements. Various
inputs are used in determining the value of the Fund's investments. These inputs
are summarized in the three broad levels listed below:
o Level 1 - quoted prices in active markets for identical securities
o Level 2 - other significant observable inputs
o Level 3 - significant unobservable inputs
The inputs or methodology used for valuing securities are not necessarily an
indication of the risk associated with investing in those securities.
As of December 31, 2008, all of the inputs used to value the Fund's investments
were Level 1.
SHARE VALUATION -- The net asset value per share of the Fund is calculated daily
by dividing the total value of the Fund's assets, less liabilities, by the
number of shares outstanding. The offering price and redemption price per share
of the Fund is equal to the net asset value per share, except that shares of the
Fund are subject to a redemption fee of 2% if redeemed within 90 days of the
date of purchase. During the periods ended December 31, 2008 and June 30, 2008,
proceeds from redemption fees totaled $4,025 and $5,060, respectively.
REPURCHASE AGREEMENTS -- The Fund may enter into repurchase agreements from
financial institutions such as banks and broker-dealers that the Trust's
investment adviser deems creditworthy under the guidelines approved by the Board
of Trustees, subject to the seller's agreement to repurchase such securities at
a mutually agreed-upon date and price. The repurchase price generally equals the
price paid
12
OAK VALUE FUND
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
================================================================================
by the Fund plus interest negotiated on the basis of current short-term rates,
which may be more or less than the rate on the underlying portfolio securities.
The seller under a repurchase agreement is required to maintain the value of
collateral held pursuant to the agreement at not less than the repurchase price
(including accrued interest). If the seller defaults, and the fair value of the
collateral declines, realization of the collateral by the Fund may be delayed or
limited.
INVESTMENT INCOME -- Interest income is accrued as earned. Dividend income is
recorded on the ex-dividend date.
DISTRIBUTIONS TO SHAREHOLDERS -- Dividends arising from net investment income,
if any, are declared and paid semi-annually to shareholders of the Fund. Net
realized short-term capital gains, if any, may be distributed throughout the
year and net realized long-term capital gains, if any, are distributed at least
once each year. The amount of distributions from net investment income and net
realized capital gains are determined in accordance with federal income tax
regulations which may differ from accounting principles generally accepted in
the United States of America ("GAAP"). These "book/tax" differences are either
temporary or permanent in nature and are primarily due to losses deferred due to
wash sales. The tax character of distributions paid during the six months ended
December 31, 2008 was $43,926 of ordinary income and $182,701 of long-term
capital gains. The tax character of distributions paid during the year ended
June 30, 2008 was $268,376 of ordinary income and $12,843,602 of long-term
capital gains. Dividends and distributions to shareholders are recorded on the
ex-dividend date.
SECURITY TRANSACTIONS -- Security transactions are accounted for on trade date.
Gains and losses on securities sold are determined on a specific identification
basis.
ESTIMATES -- The preparation of financial statements in conformity with GAAP
requires management to make estimates and assumptions that affect the reported
amounts of assets and liabilities and disclosure of contingent assets and
liabilities at the date of the financial statements and the reported amounts of
income and expenses during the reporting period. Actual results could differ
from those estimates.
FEDERAL INCOME TAX -- It is the Fund's policy to comply with the special
provisions of Subchapter M of the Internal Revenue Code applicable to regulated
investment companies. As provided therein, in any fiscal year in which the Fund
so qualifies and distributes at least 90% of its taxable net income, the Fund
(but not the shareholders) will be relieved of federal income tax on the income
distributed. Accordingly, no provision for income taxes has been made.
In order to avoid imposition of the excise tax applicable to regulated
investment companies, it is also the Fund's intention to declare as dividends in
each calendar year at least 98% of its net investment income (earned during the
calendar year) and 98% of its net realized capital gains (earned during the
twelve months ended October 31) plus undistributed amounts from prior years.
The following information is computed on a tax basis for each item as of
December 31, 2008:
- --------------------------------------------------------------------------------
Tax cost of portfolio investments ............................ $ 73,134,742
============
Gross unrealized appreciation ................................ $ 8,168,036
Gross unrealized depreciation ................................ (19,456,782)
------------
Net unrealized depreciation .................................. $(11,288,746)
Accumulated undistributed ordinary income .................... 1,570
Other gains .................................................. 151,473
Other temporary differences due to cash distributions ........ (1,050)
------------
Accumulated deficit .......................................... $(11,136,753)
============
- --------------------------------------------------------------------------------
13
OAK VALUE FUND
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
================================================================================
The difference between the federal income tax cost of portfolio of investments
and the financial statement cost is due to certain timing differences in the
recognition of capital losses under income tax regulations and GAAP. These
"book/tax" differences are temporary in nature and are primarily due to the tax
deferral of losses on wash sales.
FASB's Interpretation No. 48 ("FIN 48") "Accounting for Uncertainty in Income
Taxes" provides guidance for how uncertain tax positions should be recognized,
measured, presented and disclosed in the financial statements. FIN 48 requires
the evaluation of tax positions taken in the course of preparing the Fund's tax
returns to determine whether the tax positions are "more-likely-than-not" of
being sustained by the applicable tax authority. Tax positions not deemed to
meet the more-likely-than-not threshold would be recorded as a tax benefit or
expense in the current year. As required by FIN 48, management has analyzed the
Fund's tax positions taken on Federal income tax returns for all open tax years
(tax years ended June 30, 2005 through June 30, 2008) and has concluded that no
provision for income tax is required in these financial statements.
2. INVESTMENT TRANSACTIONS
During the six months ended December 31, 2008, cost of purchases and proceeds
from sales and maturities of investment securities, excluding short-term
investments, amounted to $16,044,830 and $25,060,286, respectively.
3. TRANSACTIONS WITH AFFILIATES
The Fund's investments are managed by Oak Value Capital Management, Inc. (the
"Adviser") under the terms of an Investment Advisory Agreement. Under the
Investment Advisory Agreement, the Fund pays the Adviser a fee, which is
computed and accrued daily and paid monthly, at an annual rate of 0.90% of the
Fund's average daily net assets.
Certain Trustees and officers of the Trust are also officers of the Adviser or
of Ultimus Fund Solutions, LLC ("Ultimus"), the Fund's administrator, transfer
agent and fund accounting services agent. Such Trustees and officers receive no
direct payments or fees from the Trust for serving as officers.
Under the terms of an Administration Agreement with the Trust, Ultimus provides
internal regulatory compliance services and executive and administrative
services. Ultimus supervises the preparation of tax returns, reports to
shareholders of the Fund, reports to and filings with the Securities and
Exchange Commission and state securities commissions, and materials for meetings
of the Board of Trustees. For the performance of these services, the Fund pays
Ultimus a fee at the annual rate of .10% of the average value of its daily net
assets up to $50 million, .075% of such assets from $50 million to $200 million
and .05% of such assets in excess of $200 million, provided, however, that the
minimum fee is $2,000 per month.
Under the terms of a Transfer Agent and Shareholder Services Agreement with the
Trust, Ultimus maintains the records of each shareholder's account, answers
shareholders' inquiries concerning their accounts, processes purchases and
redemptions of the Fund's shares, acts as dividend and distribution disbursing
agent and performs other shareholder service functions. Ultimus receives from
the Fund for its services as transfer agent a fee payable monthly at an annual
rate of $16 per account, provided, however, that the minimum fee is $2,000 per
month. In addition, the Fund pays out-of-pocket expenses, including but not
limited to, postage and supplies. Accordingly, during the six months ended
December 31, 2008, Ultimus was paid $20,771 of transfer agent and shareholder
services fees.
14
OAK VALUE FUND
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
================================================================================
The Fund has entered into agreements with certain financial intermediaries to
provide record keeping, processing, shareholder communications and other
services to the Fund. These services would be provided by the Fund if the shares
were held in accounts registered directly with the Fund's transfer agent.
Accordingly, the Fund pays a fee to such service providers in an amount
equivalent to or less than the per account fee paid to the transfer agent.
During the six months ended December 31, 2008, the Fund paid $29,521 for such
services. These fees are included in "Transfer agent and shareholder services
fees" on the Statement of Operations.
Under the terms of a Fund Accounting Agreement with the Trust, Ultimus
calculates the daily net asset value per share and maintains such books and
records as are necessary to enable Ultimus to perform its duties. For these
services, the Fund pays Ultimus a base fee of $2,000 per month, plus an
asset-based fee at the annual rate of .01% of the average value of its daily net
assets up to $500 million and .005% of such assets in excess of $500 million. In
addition, the Fund pays all costs of external pricing services.
Under the terms of a Compliance Consulting Agreement with the Trust, Ultimus
provides an individual with the requisite background and familiarity with the
Federal Securities Laws to serve as the Chief Compliance Officer and to
administer the Trust's compliance policies and procedures. For these services,
the Fund pays Ultimus a base fee of $1,500 per month, plus an asset-based fee at
the annual rate of .01% of the average value of its daily net assets from $100
million to $500 million, .005% of such assets from $500 million to $1 billion
and .0025% of such assets in excess of $1 billion. In addition, the Fund
reimburses Ultimus for its reasonable out-of-pocket expenses, if any, relating
to these compliance services.
4. BANK LINE OF CREDIT
The Fund has an unsecured $25,000,000 bank line of credit. Borrowings under this
arrangement bear interest at a rate per annum equal to Prime Rate minus 0.50%.
During the six months ended December 31, 2008, the Fund incurred $68 of interest
expense related to borrowings under the line of credit. Average debt outstanding
during the six months ended December 31, 2008 was $2,968. As of December 31,
2008, the Fund had no outstanding borrowings.
5. CONTINGENCIES AND COMMITMENTS
The Fund indemnifies the Trust's officers and Trustees for certain liabilities
that might arise from their performance of their duties to the Fund.
Additionally, in the normal course of business the Fund enters into contracts
that contain a variety of representations and warranties and which provide
general indemnifications. The Fund's maximum exposure under these arrangements
is unknown, as this would involve future claims that may be made against the
Fund that have not yet occurred. However, based on experience, the Fund expects
the risk of loss to be remote.
15
OAK VALUE FUND
ABOUT YOUR FUND'S EXPENSES (UNAUDITED)
================================================================================
We believe it is important for you to understand the impact of costs on your
investment. As a shareholder of the Fund, you incur two types of costs: (1)
transaction costs, including redemption fees; and (2) ongoing costs, including
management fees and other Fund expenses. The following examples are intended to
help you understand your ongoing costs (in dollars) of investing in the Fund and
to compare these costs with the ongoing costs of investing in other mutual
funds.
A mutual fund's ongoing costs are expressed as a percentage of its average net
assets. This figure is known as the expense ratio. The expenses in the table
below are based on an investment of $1,000 made at the beginning of the most
recent semi-annual period (July 1, 2008) and held until the end of the period
(December 31, 2008).
The table below illustrates the Fund's costs in two ways:
ACTUAL FUND RETURN - This section helps you to estimate the actual expenses that
you paid over the period. The "Ending Account Value" shown is derived from the
Fund's actual return, and the third column shows the dollar amount of operating
expenses that would have been paid by an investor who started with $1,000 in the
Fund. You may use the information here, together with the amount you invested,
to estimate the expenses that you paid over the period.
To do so, simply divide your account value by $1,000 (for example, an $8,600
account value divided by $1,000 = 8.6), then multiply the result by the number
given for the Fund under the heading "Expenses Paid During Period."
HYPOTHETICAL 5% RETURN - This section is intended to help you compare the Fund's
costs with those of other mutual funds. It assumes that the Fund had an annual
return of 5% before expenses during the period shown, but that the expense ratio
is unchanged. In this case, because the return used is not the Fund's actual
return, the results do not apply to your investment. The example is useful in
making comparisons because the Securities and Exchange Commission requires all
mutual funds to calculate expenses based on a 5% return. You can assess the
Fund's costs by comparing this hypothetical example with the hypothetical
examples that appear in shareholder reports of other funds.
Note that expenses shown in the table are meant to highlight and help you
compare ongoing costs only. The Fund does not impose any sales charges. However,
a redemption fee of 2% is applied on the sale of shares sold within 90 days of
the date of purchase. The redemption fee does not apply to the redemption of
shares acquired through reinvestment of dividends and other distributions.
The calculations assume no shares were bought or sold during the period. Your
actual costs may have been higher or lower, depending on the amount of your
investment and the timing of any purchases or redemptions.
More information about the Fund's expenses, including annual expense ratios for
the prior five fiscal years, can be found in this report. For additional
information on operating expenses and other shareholder costs, please refer to
the Fund's prospectus.
- --------------------------------------------------------------------------------
Beginning Ending
Account Value Account Value Expenses Paid
July 1, 2008 December 31, 2008 During Period*
- --------------------------------------------------------------------------------
Based on Actual Fund Return $1,000.00 $ 756.40 $6.60
Based on Hypothetical 5%
Return (before expenses) $1,000.00 $1,017.69 $7.58
- --------------------------------------------------------------------------------
* Expenses are equal to the annualized expense ratio of 1.49% for the
period, multiplied by the average account value over the period,
multiplied by 184/365 (to reflect the one-half year period).
16
OAK VALUE FUND
OTHER INFORMATION (UNAUDITED)
================================================================================
A description of the policies and procedures the Fund uses to determine how to
vote proxies relating to portfolio securities is available without charge upon
request by calling toll-free 1-800-622-2474, or on the Securities and Exchange
Commission's ("SEC") website at http://www.sec.gov. Information regarding how
the Fund voted proxies relating to portfolio securities during the most recent
12-month period ended June 30 is also available without charge upon request by
calling toll-free 1-800-622-2474, or on the SEC's website http://www.sec.gov.
The Trust files a complete listing of portfolio holdings for the Fund with the
SEC as of the end of the first and third quarters of each fiscal year on Form
N-Q. The filings are available without charge upon request, by calling
1-800-622-2474. Furthermore, you may obtain a copy of the filings on the SEC's
website at http://www.sec.gov. The Trust's Forms N-Q may also be reviewed and
copied at the SEC's Public Reference Room in Washington, DC, and information on
the operation of the Public Reference Room may be obtained by calling
1-800-SEC-0330.
17
OAK VALUE FUND
APPROVAL OF ADVISORY AGREEMENT (UNAUDITED)
================================================================================
The Board of Trustees of the Trust, with the Independent Trustees voting
separately, has approved the continuance of the Fund's Investment Advisory
Agreement (the "Agreement") with the Adviser. Approval took place at a meeting
held on November 11, 2008, at which all of the Trustees were present.
The Trustees were advised by counsel of their fiduciary obligations in approving
the Agreement, and the Independent Trustees requested such information from the
Adviser as they deemed reasonably necessary to evaluate the terms of the
Agreement and whether the Agreement will continue to be in the best interests of
the Fund and its shareholders. The Trustees reviewed: (i) the nature, extent and
quality of the services provided by the Adviser; (ii) the investment performance
of the Fund and the Adviser; (iii) the costs of the services provided and the
profits realized by the Adviser from its relationship with the Fund; (iv) the
extent to which economies of scale would be realized as the Fund grows; and (v)
whether fee levels reflect these economies of scale for the benefit of the
Fund's shareholders. The Trustees reviewed the background, qualifications,
education and experience of the Adviser's portfolio managers, research staff and
support personnel and the operations and ownership of the Adviser. The Trustees
also reviewed the responsibilities of the Adviser under the Agreement and
considered the quality of the advisory services provided to the Trust, including
the Adviser's intensive research process and its practices with regards to
shareholder protection, shareholder services and communications, and compliance.
The Independent Trustees were advised and supported by counsel experienced in
securities matters throughout the process. Prior to voting, the Independent
Trustees reviewed and discussed the proposed continuance of the Agreement with
management of the Adviser.
The Adviser provided the Board with extensive information to assist the Trustees
with analyzing the Fund's performance over various periods. The Fund's returns
for periods ended June 30, 2008 were compared to the returns of its benchmark
index and similarly managed mutual funds. These analyses and comparisons showed
that the short-term (1 year) and long-term (5-year and 10-year) performance of
the Fund trailed the performance of the S&P 500 Index and the average of Large
Cap Blend funds as categorized by Morningstar. Based upon their review, the
Trustees found that the Adviser has provided valuable advisory services and has
consistently adhered to the stated investment objective and strategies of the
Fund.
In reviewing the advisory fees and the total expense ratio of the Fund, the
Trustees were provided with comparative expense and advisory fee information for
other similarly situated mutual funds, categorized both by fund size and by
investment style. The Trustees also considered the "fallout benefits" received
by the Adviser in its management of the Fund, including certain research
services received as a result of placement of the Fund's brokerage, but, given
the amounts involved, viewed these as secondary factors in connection with the
reasonableness of the advisory fees being paid by the Fund. The Trustees
concluded that, based upon the investment strategies and the long-term
performance of the Fund, the advisory fees paid by the Fund are reasonable.
The Trustees reviewed a recent balance sheet of the Adviser and a statement of
the Adviser's revenues and estimated expenses with respect to its management of
the Fund during the Fund's fiscal year ended June 30, 2008. The Trustees also
reviewed the Fund's brokerage costs and determined that the brokerage
commissions negotiated by the Adviser on behalf of the Fund are competitive with
industry averages.
18
OAK VALUE FUND
APPROVAL OF ADVISORY AGREEMENT (UNAUDITED)
(CONTINUED)
================================================================================
The Independent Trustees concluded that: (i) in considering the Adviser's
disciplined investment approach of buying businesses having durable competitive
advantages and adequate margins or safety, the risk characteristics of the Fund
and the effectiveness of the Fund in achieving its stated objective, they
believe the nature, extent and quality of services provided by the Adviser are
valuable, particularly in light of the current market environment; (ii) although
the Fund's performance (computed over periods ended June 30, 2008) for the one
year, five year and ten year periods fell below the returns of its benchmark
index (the S&P 500), the Fund's relative performance for the one year and ten
year periods ended September 30, 2008 exceeded the S&P 500 Index due primarily
to the Fund's avoidance of extremely cyclical and heavily commodity-based
businesses; (iii) although the advisory fees and overall operating expenses of
the Fund are in the higher range of advisory fees and expenses for mutual funds
of similar size and similar investment goals, the Independent Trustees believe
that the scope and quality of services provided by the Adviser, which exceed the
norm, support the appropriateness of the advisory fees payable by the Fund and
were mindful that after factoring in the estimated costs of distribution
incurred by the Adviser on behalf of the Fund, the Adviser did not realize any
profits from the advisory fees paid by the Fund; and (iv) given the current and
projected asset levels in the Fund, it would not be relevant to consider the
extent to which economies of scale would be realized as the Fund grows, and
whether fee levels reflect these economies of scale. The Independent Trustees
also reviewed and considered the profitability of the Adviser with regards to
its management of the Fund, concluding that the Adviser's profitability was not
excessive given the high quality and scope of services provided by the Adviser
and the long-term investment performance of the Fund. The Independent Trustees
agreed that it is not appropriate to introduce fee breakpoints at the present
time. The Trustees noted, however, that if the Fund grows significantly in
assets, it may become necessary for the Adviser to consider adding fee
breakpoints to the Agreement.
No single factor was considered in isolation or to be determinative to the
decision of the Independent Trustees to approve continuance of the Agreement.
Rather, the Independent Trustees concluded, in light of a weighing and balancing
of all factors considered, that the advisory fees payable by the Fund under the
Agreement are fair and reasonable. The Independent Trustees determined that it
would be in the best interests of the Fund and its shareholders for the Adviser
to continue to serve as investment adviser and voted to renew the Agreement for
an additional annual period.
19
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OAK VALUE FUND
INVESTMENT ADVISER
Oak Value Capital Management, Inc.
1450 Raleigh Road, Suite 220
Chapel Hill, North Carolina 27517
1-800-680-4199
www.oakvaluefund.com
ADMINISTRATOR
Ultimus Fund Solutions, LLC
225 Pictoria Drive, Suite 450
Cincinnati, Ohio 45246
INDEPENDENT REGISTERED PUBLIC
ACCOUNTING FIRM
Briggs, Bunting & Dougherty, LLP
1835 Market Street
26th Floor
Philadelphia, Pennsylvania 19103
CUSTODIAN
US Bank, N.A.
425 Walnut Street
Cincinnati, Ohio 45202
BOARD OF TRUSTEES
Joseph T. Jordan, Jr., Chairman
C. Russell Bryan
Larry D. Coats, Jr.
John M. Day
Charles T. Manatt
OFFICERS
Larry D. Coats, Jr., President
Margaret C. Landis, Vice President
Robert G. Dorsey, Vice President
Mark J. Seger, Treasurer/
Chief Compliance Officer
John F. Splain, Secretary
THIS REPORT IS FOR THE INFORMATION OF THE SHAREHOLDERS OF THE OAK VALUE FUND. IT
MAY NOT BE DISTRIBUTED TO PROSPECTIVE INVESTORS UNLESS IT IS PRECEDED OR
ACCOMPANIED BY THE CURRENT FUND PROSPECTUS.
ITEM 2. CODE OF ETHICS.
Not required
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.
Not required
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
Not required
ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS.
Not applicable
ITEM 6. SCHEDULE OF INVESTMENTS.
Not applicable [schedule filed with Item 1]
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END
MANAGEMENT INVESTMENT COMPANIES.
Not applicable
ITEM 8. PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES.
Not applicable
ITEM 9. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT
COMPANY AND AFFILIATED PURCHASERS.
Not applicable
ITEM 10. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
The registrant's governance, nomination and compensation committee will consider
shareholder recommendations to fill vacancies on the registrant's board of
trustees if such recommendations are submitted in writing and addressed to the
committee at the registrant's offices. The committee may adopt, by resolution, a
policy regarding its procedures for considering candidates for the board of
trustees, including any recommended by shareholders.
ITEM 11. CONTROLS AND PROCEDURES.
(a) Based on their evaluation of the registrant's disclosure controls and
procedures (as defined in Rule 30a-3(c) under the Investment Company Act of
1940) as of a date within 90 days of the filing date of this report, the
registrant's principal executive officer and principal financial officer have
concluded that such disclosure controls and procedures are reasonably designed
and are operating effectively to ensure that material information relating to
the registrant, including its consolidated subsidiaries, is made known to them
by others within those entities, particularly during the period in which this
report is being prepared, and that the information required in filings on Form
N-CSR is recorded, processed, summarized, and reported on a timely basis.
(b) There were no changes in the registrant's internal control over financial
reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940)
that occurred during the second fiscal quarter of the period covered by this
report that have materially affected, or are reasonably likely to materially
affect, the registrant's internal control over financial reporting.
ITEM 12. EXHIBITS.
File the exhibits listed below as part of this Form. Letter or number the
exhibits in the sequence indicated.
(a)(1) Any code of ethics, or amendment thereto, that is the subject of the
disclosure required by Item 2, to the extent that the registrant intends to
satisfy the Item 2 requirements through filing of an exhibit: Not required
(a)(2) A separate certification for each principal executive officer and
principal financial officer of the registrant as required by Rule 30a-2(a) under
the Act (17 CFR 270.30a-2(a)): Attached hereto
(a)(3) Any written solicitation to purchase securities under Rule 23c-1 under
the Act (17 CFR 270.23c-1) sent or given during the period covered by the report
by or on behalf of the registrant to 10 or more persons: Not applicable
(b) Certifications required by Rule 30a-2(b) under the Act (17 CFR
270.30a-2(b)): Attached hereto
Exhibit 99.CERT Certifications required by Rule 30a-2(a) under the Act
Exhibit 99.906CERT Certifications required by Rule 30a-2(b) under the Act
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, the registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.
(Registrant) Oak Value Trust
-------------------------------------------------------------------
By (Signature and Title)* /s/ Larry D. Coats, Jr.
--------------------------------------------------
Larry D. Coats, Jr., President
Date February 17, 2009
-----------------------------
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.
By (Signature and Title)* /s/ Larry D. Coats, Jr.
--------------------------------------------------
Larry D. Coats, Jr., President
Date February 17, 2009
-----------------------------
By (Signature and Title)* /s/ Mark J. Seger
--------------------------------------------------
Mark J. Seger, Treasurer
Date February 17, 2009
-----------------------------
* Print the name and title of each signing officer under his or her signature.