UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934
Filed by the Registrant [X]
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14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Section 240.14a-12
BISHOP STREET FUNDS
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BISHOP STREET STRATEGIC GROWTH FUND
A SERIES OF
BISHOP STREET FUNDS
ONE FREEDOM VALLEY DRIVE
OAKS, PENNSYLVANIA 19456
Dear Shareholder:
Notice is hereby given that a Special Meeting of Shareholders (the
"Meeting") of the Bishop Street Strategic Growth Fund (the "Fund"), a series of
Bishop Street Funds (the "Trust"), will be held at 2:00 p.m., Eastern time, on
October 14, 2013. If you were a shareholder of record of the Fund as of the
close of business on August 15, 2013, you are entitled to vote at the Meeting,
and any adjournment of the Meeting.
Bishop Street Capital Management ("BSCM") currently acts as
investment adviser to the Fund. At the Meeting, shareholders will be asked to
appoint Columbia Management Investment Advisers, LLC ("Columbia") as a
sub-adviser of the Fund and approve an investment sub-advisory agreement
between BSCM and Columbia with respect to the Fund (the "Proposal"). If the
Proposal is approved by the Fund's shareholders, Columbia will manage a portion
of the Fund's assets as described in the accompanying proxy materials.
THE BOARD OF TRUSTEES OF BISHOP STREET FUNDS HAS UNANIMOUSLY APPROVED
THE PROPOSAL AND RECOMMENDS THAT YOU VOTE "FOR" THE PROPOSAL AS DESCRIBED IN
THE PROXY STATEMENT.
YOUR VOTE IS IMPORTANT TO US. PLEASE TAKE A FEW MINUTES TO REVIEW THE
PROXY STATEMENT AND VOTE YOUR SHARES TODAY. We have enclosed a proxy card that
we ask you to complete, sign, date and return as soon as possible, unless you
plan to attend the Meeting. You may also vote your shares by telephone, through
the Internet or in person. Please follow the enclosed instructions to utilize
any of these voting methods. If we do not receive your vote promptly, you may
be contacted by a representative of the Fund, who will remind you to vote your
shares.
Thank you for your attention and consideration of this important
proposal and for your investment in the Fund. If you need additional
information, please call shareholder services at 1-800-262-9565.
Sincerely,
/s/ Michael Beattie
Michael Beattie
President
PROMPT EXECUTION AND RETURN OF THE ENCLOSED PROXY CARD IS REQUESTED. A
SELF-ADDRESSED, POSTAGE-PAID ENVELOPE IS ENCLOSED FOR YOUR CONVENIENCE, ALONG
WITH INSTRUCTIONS ON HOW TO VOTE OVER THE INTERNET OR BY TELEPHONE, SHOULD YOU
PREFER TO VOTE BY ONE OF THOSE METHODS.
IMPORTANT NEWS FOR SHAREHOLDERS
While we encourage you to read the full text of the enclosed Proxy
Statement, for your convenience below is a brief overview of the matter that
requires your vote as a shareholder of the Bishop Street Strategic Growth Fund
(the "Fund"), a series of Bishop Street Funds (the "Trust").
QUESTIONS AND ANSWERS
Q. WHY AM I RECEIVING THESE PROXY MATERIALS?
A. We are sending you these proxy materials, which include a notice of
special meeting of shareholders (the "Meeting"), a proxy statement and a
proxy card, on behalf of the Fund because Bishop Street Capital Management
("BSCM"), the Fund's investment adviser, has proposed appointing Columbia
Management Investment Advisers, LLC ("Columbia") as a sub-adviser to the
Fund.
The Board of Trustees of the Trust (the "Board") is soliciting your proxy
to vote at the Meeting and at any adjournments or postponements of the
Meeting. As a shareholder of the Fund, you are being asked to appoint
Columbia as a sub-adviser of the Fund and to approve a sub-advisory
agreement between BSCM and Columbia with respect to the Fund (the "Columbia
Sub-Advisory Agreement") (the "Proposal"). You are receiving these proxy
materials because you have the right to vote on the Proposal in connection
with your investment in the Fund.
Q. WHY DOES BSCM WISH TO RETAIN COLUMBIA AS A SUB-ADVISER TO THE FUND?
A. BSCM believes that Columbia may improve the Fund's investment performance,
which has lagged the Fund's current primary benchmark, the S&P 500
Composite Index over various trailing periods. BSCM believes that Columbia
has deep resources, a strong portfolio management team, and an effective
investment process.
Q. HOW WILL THE APPROVAL OF THE PROPOSAL AFFECT THE FUND?
A. If the Proposal is approved by the Fund's shareholders at the Meeting, the
sub-advisory agreement between BNP Paribas Asset Management, Inc. ("BNP"),
the current investment sub-adviser to the Fund, and BSCM with respect to
the Fund (the "BNP Sub-Advisory Agreement") will be terminated, and BSCM
will reallocate the portion of the Fund's assets currently managed by BNP
to Columbia. Columbia then will manage, in accordance with the Fund's
investment objective and strategies, the portion of the Fund's assets
allocated to it by BSCM.
Q. HOW WILL THE APPROVAL OF THE PROPOSAL AFFECT THE FEES AND EXPENSES OF THE
FUND?
A. The approval of the Proposal will not result in any change to the fees
that are paid by shareholders of the Fund because BSCM will compensate
Columbia out of the investment advisory fees it receives from the Fund, and
BSCM's investment advisory fee rate will not change in connection with the
Proposal.
Q. WHAT HAPPENS IF THE PROPOSAL IS NOT APPROVED BY SHAREHOLDERS OF THE FUND?
A. If the Proposal is not approved by shareholders of the Fund, Columbia's
services will not be retained, and the Fund will not benefit from
Columbia's expertise and the performance attributes of Columbia's
investment strategy. Regardless, if the Proposal is not approved for the
Fund,
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BSCM and the Board will then take such further action as they deem to be in
the best interests of the Fund's shareholders, which may include
resubmitting the Proposal to shareholders for approval, negotiating a new
sub-advisory agreement with an advisory organization selected by BSCM and
approved by the Board or making other arrangements.
Q. HOW DOES THE BOARD RECOMMEND THAT I VOTE?
A. The Board, including all of the Trustees who are not "interested persons"
(as defined in the Investment Company Act of 1940, as amended) of the
Trust, has approved the appointment of Columbia as a sub-adviser of the
Fund and has approved the Columbia Sub-Advisory Agreement. The Board
unanimously recommends that shareholders of the Fund vote in favor of the
Proposal.
Q. WILL MY VOTE MAKE A DIFFERENCE?
A. Yes. Your vote is needed to ensure that the Proposal can be acted upon. We
encourage all shareholders to participate in the governance of the Fund.
Additionally, your immediate response on the enclosed proxy card may help
save the costs of any further solicitations.
Q. HOW DO I PLACE MY VOTE?
A. You may provide the Trust with your vote via mail, by Internet, by
telephone, or in person. You may use the enclosed postage-paid envelope to
mail your proxy card. Please follow the enclosed instructions to utilize
any of these voting methods. If you need more information on how to vote,
or if you have any questions, please call shareholder services at
1-800-262-9565.
Q. WHOM DO I CALL IF I HAVE QUESTIONS?
A. We will be happy to answer your questions about this proxy solicitation.
Please call shareholder services at 1-800-262-9565 between 8:30 a.m. and
5:00 p.m., Eastern time, Monday through Friday.
PROMPT EXECUTION AND RETURN OF THE ENCLOSED PROXY CARD IS REQUESTED. A
SELF-ADDRESSED, POSTAGE-PAID ENVELOPE IS ENCLOSED FOR YOUR CONVENIENCE, ALONG
WITH INSTRUCTIONS ON HOW TO VOTE OVER THE INTERNET OR BY TELEPHONE, SHOULD YOU
PREFER TO VOTE BY ONE OF THOSE METHODS.
ii
BISHOP STREET STRATEGIC GROWTH FUND
A SERIES OF
BISHOP STREET FUNDS
ONE FREEDOM VALLEY DRIVE
OAKS, PENNSYLVANIA 19456
NOTICE OF
SPECIAL MEETING OF SHAREHOLDERS
TO BE HELD ON OCTOBER 14, 2013
Notice is hereby given that a Special Meeting of Shareholders (the "Meeting")
of the Bishop Street Strategic Growth Fund (the "Fund"), a series of Bishop
Street Funds (the "Trust"), will be held at the offices of SEI Investments
Global Funds Services, One Freedom Valley Drive, Oaks, Pennsylvania 19456, on
October 14, 2013 at 2:00 p.m., Eastern time.
At the Meeting, shareholders of record of the Fund ("Shareholders") will be
asked to appoint Columbia Management Investment Advisers, LLC ("Columbia") as a
sub-adviser of the Fund and to approve a sub-advisory agreement between Bishop
Street Capital Management ("BSCM"), the investment adviser to the Fund, and
Columbia with respect to the Fund.
All Shareholders are cordially invited to attend the Meeting. However, if you
are unable to attend the Meeting, you are requested to mark, sign and date the
enclosed proxy card and return it promptly in the enclosed, postage-paid
envelope so that the Meeting may be held and a maximum number of shares may be
voted. In addition, you can vote easily and quickly by Internet, by telephone
or in person. Your vote is important no matter how many shares you own. You may
change your vote even though a proxy has already been returned by sending a
written notice to the Trust, by submitting a subsequent proxy using the mail,
by Internet, or by telephone or by voting in person at the Meeting.
Shareholders of record of the Fund at the close of business on August 15, 2013
are entitled to notice of and to vote at the Meeting or any adjournment
thereof.
IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS FOR THE
SHAREHOLDER MEETING TO BE HELD ON OCTOBER 14, 2013.
The proxy statement is available at www.proxyonline.com/docs/bishopstreetsgf.pdf
By Order of the Board of Trustees
/s/ Michael Beattie
Michael Beattie
President
BISHOP STREET STRATEGIC GROWTH FUND
A SERIES OF
BISHOP STREET FUNDS
ONE FREEDOM VALLEY DRIVE
OAKS, PA 19456
PROXY STATEMENT
SPECIAL MEETING OF SHAREHOLDERS
TO BE HELD ON OCTOBER 14, 2013
This Proxy Statement is furnished in connection with the solicitation of
proxies by the Board of Trustees of Bishop Street Funds (the "Trust"), on
behalf of the Bishop Street Strategic Growth Fund (the "Fund"), to be voted at
a special meeting of shareholders of the Fund at the offices of the Fund's
administrator, SEI Investments Global Funds Services, One Freedom Valley Drive,
Oaks, Pennsylvania 19456, on October 14, 2013 at 2:00 p.m., Eastern time, and
at any and all adjournments thereof (the "Meeting"). Shareholders of record of
the Fund at the close of business on August 15, 2013 (the "Record Date") are
entitled to notice of, and to vote at, the Meeting. The proxy card and this
proxy statement are being mailed to Shareholders on or about September 24,
2013.
The Trust currently offers one class of shares of beneficial interest
("Shares") of the Fund: Class I Shares. Each full Share will be entitled to one
vote at the Meeting and each fraction of a Share will be entitled to the
fraction of a vote equal to the proportion of a full share represented by the
fractional Share. As of the Record Date, the Fund had 3,303,417.667 Shares
issued and outstanding.
As used in this Proxy Statement, the term "Board" refers to the Board of
Trustees of the Trust. The term "Trustee" includes each trustee of the Board. A
Trustee who is not an "interested person," as defined in the Investment Company
Act of 1940, as amended (the "1940 Act"), of the Trust is referred to in this
proxy statement as an "Independent Trustee."
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PROPOSAL: TO APPOINT COLUMBIA MANAGEMENT INVESTMENT ADVISERS, LLC ("COLUMBIA")
AS A SUB-ADVISER OF THE FUND AND TO APPROVE A SUB-ADVISORY AGREEMENT
BETWEEN BISHOP STREET CAPITAL MANAGEMENT ("BSCM") AND COLUMBIA WITH
RESPECT TO THE FUND.
DESCRIPTION OF THE PROPOSAL
Shareholders of the Fund are being asked to appoint Columbia as a sub-adviser
of the Fund and approve a sub-advisory agreement between BSCM, the Fund's
investment adviser, and Columbia (the "Columbia Sub-Advisory Agreement") with
respect to the Fund (the "Proposal"). Pursuant to the Columbia Sub-Advisory
Agreement, Columbia will manage the portion of the Fund's assets allocated to
it by BSCM using a large cap growth strategy in accordance with the Fund's
investment objective and strategies as described in its registration
statement.
In general, the 1940 Act requires all new investment advisory agreements,
including sub-advisory agreements, to be approved by the vote of a "majority of
the outstanding voting securities" (as defined in the 1940 Act) of a registered
investment company. Under the 1940 Act, the vote of a "majority of the
outstanding voting securities" of the Fund means the affirmative vote of the
lesser of: (a) 67% or more of the voting securities present at the Meeting or
represented by proxy if the holders of more than 50% of the outstanding voting
securities are present or represented by proxy; or (b) more than 50% of the
outstanding voting securities (a "1940 Act Majority"). Approval of the Proposal
requires the affirmative vote of a 1940 Act Majority of the Fund's Shares.
Accordingly, the purpose of this Proxy Statement is to submit the Columbia
Sub-Advisory Agreement to a vote of the Fund's shareholders pursuant to the
requirements of the 1940 Act described above.
BSCM currently serves as the investment adviser to the Fund pursuant to an
investment advisory agreement between the Trust and BSCM, dated March 31, 1999
(the "Advisory Agreement"). As described in more detail below, at its Board
Meeting held on August 12, 2013 (the "Board Meeting"), the Board, including all
of the Independent Trustees, unanimously approved (a) the appointment of
Columbia as a sub-adviser to the Fund and (b) the Columbia Sub-Advisory
Agreement. In addition, the Board, including all of the Independent Trustees,
unanimously recommended the approval of the Columbia Sub-Advisory Agreement to
the Fund's shareholders.
In addition, the Board, at the Board Meeting, also approved the termination of
the investment sub-advisory agreement between BSCM and BNP Paribas Asset
Management, Inc. ("BNP") with respect to the Fund, subject to shareholder
approval of the Proposal. If the Proposal is approved by shareholders, Columbia
will manage the portion of the Fund's assets currently allocated to BNP. BSCM
has proposed replacing BNP as a sub-adviser to the Fund because BSCM believes
that Columbia may improve the Fund's investment performance, which has lagged
the Fund's current primary benchmark, the S&P 500 Composite Index over various
trailing periods. BSCM believes that Columbia has deep resources, a strong
portfolio management team, and an effective investment process.
BSCM recommends that shareholders vote in favor of the Proposal to appoint
Columbia as a sub-adviser of the Fund and to approve the Columbia Sub-Advisory
Agreement.
It is expected that Columbia will provide the same level of services to the
Fund under the terms of the Columbia Sub-Advisory Agreement as BNP currently
provides to the Fund under the terms of the sub-advisory agreement between BSCM
and BNP (the "BNP Sub-Advisory Agreement") with respect to the Fund. Further,
the appointment of Columbia as a sub-adviser to the Fund will not result in any
change to the fees that are paid by shareholders of the Fund because BSCM will
compensate Columbia out of the investment advisory fees it receives from the
Fund, and BSCM's investment advisory fee rate will not change in connection
with the appointment of Columbia.
2
BNP currently manages the portion of Fund assets allocated to it pursuant to
its proprietary large cap growth strategy. If the Proposal is approved by
shareholders, Columbia will invest the portion of the Fund's assets allocated
to it pursuant to its proprietary Select Large Cap Growth Strategy, which
differs from BNP's large cap growth strategy. Columbia will manage such assets
in accordance with its own security selection processes consistent with the
Fund's investment objective of long term capital appreciation.
Additional information regarding BNP's proprietary large cap growth strategy
and Columbia's proprietary Select Large Cap Growth Strategy is set forth
below:
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BNP'S PROPRIETARY LARGE CAP GROWTH STRATEGY COLUMBIA'S PROPRIETARY SELECT LARGE CAP
GROWTH STRATEGY
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Pursuant to its proprietary large cap growth Pursuant to Columbia's proprietary select large cap
strategy, BNP currently invests the Fund's assets growth strategy, under normal circumstances, the
allocated to it primarily in U.S. common stocks that Fund would invest at least 80% of its net assets
BNP believes have potential for capital (plus the amount of any borrowings for investment
appreciation. BNP's investment strategy, which is purposes) in common stocks of U.S. and foreign
designed to offer pure exposure to the U.S. equity companies that have market capitalizations, at the
market, relies on an active bottom-up approach time of purchase, in the range of companies in the
using a quantitative investment model and results Russell 1000 Growth Index (the "Index"). The
in a fully invested, focused portfolio. market capitalization range of the companies
included within the Index was $519 million to
BNP selects securities from an investment universe $370.4 billion as of June 30, 2013. The Fund would
of roughly 500-600 large, liquid and well-covered invest primarily in common stocks of companies
companies. In a first, quantitative step, BNP's that Columbia believes have the potential for long-
proprietary, extensively back-tested model term growth. The Fund would have the ability to
generates a "Sell" and a "Buy" list. Each list is invest directly in foreign securities or indirectly
comprised of a limited number of stocks identified through depositary receipts. The Fund would not
with the help of a few pre-selected growth and concentrate its assets in any single industry but may
valuation indicators (used to rank the whole from time to time be able to invest more than 25%
universe in order of attractiveness) and of its assets in companies conducting business in
implementation guidelines (defining how various industries within an economic sector.
recommended operations can be derived from that
ranking). BNP reviews in detail the stocks in the Columbia targets innovative companies that are
"Sell" and "Buy" lists to identify the reasons gaining market share in industries that represent a
behind the model's recommendation (including any larger segment of the overall economy. Columbia
reason to consider it biased), and to fully believes such financially strong, rapidly growing
understand the company's strategy, its business companies have the potential to provide investors
model and its outlook. The portfolio manager is with considerably higher returns than the overall
responsible for making the final investment market.
decisions within the leeway left by the model's
implementation guidelines to exceptionally Columbia intends to combine fundamental and
override "Sell" recommendations and select the quantitative analysis with risk management in
most attractive candidates within the "Buy" list. As identifying investment opportunities and
a result of BNP's research carried out to develop its constructing the Fund's portfolio. Columbia
investment model, the Fund's style constantly considers, among other factors:
maintains a clear growth bias, the strength of which
can be modulated in accordance with market o overall economic and market conditions; and
conditions.
o the financial condition and management of a
company, including its competitive position,
the quality of its balance sheet and earnings, its
future prospects, and the potential for growth
and stock price appreciation.
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3
VOTING AUTHORITY OF BSCM AFFILIATE
Certain separate account and trust account clients (collectively "FHB Clients")
of First Hawaiian Bank ("FHB"), an affiliate of BSCM, have delegated proxy
voting responsibility to FHB pursuant to the terms of their investment advisory
agreements and trust instruments (collectively, "FHB Agreements"), respectively,
to which FHB is a party. Accordingly, FHB has the authority to vote on behalf of
FHB Clients the Shares held by FHB Clients in the Fund. FHB intends to vote such
Shares over which it has proxy voting authority in accordance with the
recommendation of an independent proxy voting firm. Pursuant to the terms of the
FHB Agreements, FHB Clients generally do not retain the right to revoke the
proxy voting authority they have delegated to FHB.
The table below provides a breakdown, as of the Record Date, of outstanding
Shares of the Fund for which FHB was believed to possess voting power. The
Shares to be voted by FHB, in accordance with the recommendation of an
independent proxy voting service, constitute a 1940 Act Majority of the Fund's
Shares to be voted at the Meeting.
NUMBER OF SHARES PERCENTAGE OF FUND
2,942,013.3360 89.06%
DESCRIPTION OF THE MATERIAL TERMS OF THE COLUMBIA SUB-ADVISORY AGREEMENT
As described in more detail below, at the Board Meeting the Board considered
the approval of the Columbia Sub-Advisory Agreement pursuant to which Columbia
will act as a sub-adviser for the Fund. The form of the Columbia Sub-Advisory
Agreement is included as Appendix A. The summary below is qualified in its
entirety by reference to the form of Columbia Sub-Advisory Agreement included
as Appendix A. Set forth below is a summary of all material terms of the
Columbia Sub-Advisory Agreement.
o INVESTMENT ADVISORY SERVICES
Columbia is responsible for providing the following investment advisory
services to the Fund under the Columbia Sub-Advisory Agreement: (i) regularly
providing the Fund with investment research, advice and supervision; (ii)
continuously furnishing an investment program for the portion of the Fund's
assets allocated to it by BSCM; (iii) deciding what securities and other assets
of the Fund will be purchased, retained or sold with respect to the portion of
the Fund's assets entrusted to it; (iv) arranging for the purchase and the sale
of securities and other assets held by the Fund by placing purchase and sale
orders with brokers or dealers selected by Columbia; (v) in its selection of
brokers or dealers and the placing of orders, seeking the best overall terms
available; and (vi) providing BSCM or the Board with periodic reports
concerning the obligations Columbia has assumed under the Columbia Sub-Advisory
Agreement as BSCM or the Board may reasonably request. All services provided by
Columbia under the Columbia Sub-Advisory Agreement are required to be performed
in accordance with the Fund's registration
4
statement, and any written policies, guidelines, instructions and procedures
provided to Columbia, the Fund's governing documents, and the requirements of
the 1940 Act and other applicable laws.
o COMPENSATION
For the services to be provided by Columbia to the Fund, BSCM will pay Columbia
a sub-advisory fee, calculated daily and paid monthly at an annual rate based
on the following fee schedule, which is based on the average daily net assets
of the portion of the Fund's assets allocated by BSCM to Columbia:
0.36% on the first $75 million;
0.35% on the next $75 million;
0.325% on the next $100 million;
0.30% on the next $250 million; and
0.25% on assets over $500 million
o INDEMNIFICATION
Under the Columbia Sub-Advisory Agreement, Columbia has an obligation to
indemnify and hold harmless the Trust, each affiliated person of the Trust as
defined in the 1940 Act, and each person who controls the Trust as defined in
the Securities Act of 1933, as amended (each an "Indemnified Party"), against
any and all losses, claims, damages, liabilities or litigation (including
reasonable legal and other expenses) by reason of or arising out of: (a)
Columbia being in material violation of any applicable federal or state law,
rule or regulation or any investment policy or restriction set forth in the
Fund's registration statement or any written guidelines or instruction provided
to Columbia in writing by the Trust, (b) the Fund's failure to satisfy the
diversification or source of income requirements of Subchapter M of the
Internal Revenue Code of 1986, as amended, or (c) Columbia's willful
misfeasance, bad faith, or gross negligence generally in the performance of its
duties hereunder or its reckless disregard of its obligations and duties under
the Columbia Sub-Advisory Agreement; provided, however, that the foregoing
indemnification shall not apply to any losses, claims, damages, liabilities or
litigation sustained as a result of BSCM's, the Trust's, their officers',
partners', employees', consultants' or agents' willful misfeasance, bad faith,
gross negligence or reckless disregard of the duties under the Advisory
Agreement or the Columbia Sub-Advisory Agreement or violation of applicable
law.
o MAINTENANCE OF BOOKS AND RECORDS
Under the Columbia Sub-Advisory Agreement, Columbia is required to maintain
separate books and detailed records of all matters pertaining to the securities
and other assets of the Fund advised by Columbia as required by Rule 31a-1
under the 1940 Act (other than those records being maintained by BSCM or the
Fund's other service providers) relating to its responsibilities under the
Columbia Sub-Advisory Agreement, and shall preserve such records for the
periods and in the manner prescribed by Rule 31a-2 under the 1940 Act.
o REPORTING OBLIGATION
Columbia has an obligation to provide the Trust's Chief Compliance Officer and
BSCM with quarterly compliance reports. Columbia also has an obligation to
notify the Trust's Chief Compliance Officer and BSCM promptly upon detection of
(i) any material failure to manage the Fund in accordance with its
5
investment objectives and policies or any applicable law; or (ii) any material
breach of any of the Fund's policies, guidelines or procedures provided to
Columbia.
o DURATION AND TERMINATION
If approved by shareholders at the Meeting, the Columbia Sub-Advisory Agreement
is scheduled to continue in effect for an initial two year term, and may be
continued from year to year thereafter if approved by (a) a majority vote of
the Board, including a majority of the Independent Trustees, cast in person at
a meeting called for the purpose of voting on such approval or as otherwise
required by the 1940 Act, or (b) the vote of a majority of the outstanding
voting securities of the Fund. The Columbia Sub-Advisory Agreement can be
terminated (a) by the Fund either (i) by vote of its Board upon not more than
sixty (60) days' or less than thirty (30) days' written notice or (ii) upon the
affirmative vote of a majority of the outstanding voting securities of the
Fund, (b) by BSCM at any time on not more than 60 days' nor less than 30 days'
written notice to Columbia, or (c) by Columbia at any time on not more than 60
days' nor less than 30 days' written notice to BSCM.
o GOVERNING LAW
The Columbia Sub-Advisory Agreement is governed by and construed in accordance
with the substantive laws of the Commonwealth of Massachusetts.
INFORMATION ABOUT COLUMBIA
Columbia, a Minnesota limited liability company located at 225 Franklin Street,
Boston, Massachusetts 02110, is an investment adviser registered under the
Investment Advisers Act of 1940, as amended (the "Advisers Act"). Columbia is a
wholly owned subsidiary of Ameriprise Financial. As of June 30, 2013, Columbia
had approximately $336 billion in assets under management.
Listed below are the names, titles and addresses of each principal executive
officer and director of Columbia. The principal business address of each
principal executive officer and director of Columbia is 225 Franklin Street,
Boston, Massachusetts 02110.
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NAME TITLE
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J. Kevin Connaughton Managing Director and General Manager -- Mutual Fund Products
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Amy K. Johnson Senior Vice President and Chief Operating Officer
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Jeffrey L. Knight Managing Director and Head of Global Asset Allocation
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Colin J. Lundgren Managing Director and Head of Fixed Income
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Robert McConnaughey Managing Director and Global Research Director
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Brian J. McGrane Director, Senior Vice President and Chief Financial Officer
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Colin Moore Director and Global Chief Investment Officer
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Jeffrey F. Peters Director, Senior Vice President and Head of Global
Institutional Distribution
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Kevin G. Poole Chief Compliance Officer
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Scott R. Plummer Senior Vice President and Chief Legal Officer
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Christopher Thompson Director, Senior Vice President and Head of Intermediary Distribution,
Marketing and Product
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William F. Truscott President and Chairman of the Board
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Amy L. Unckless Director, Senior Vice President, Head of Private Wealth Management and
Global Chief Administrative Officer
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Todd White Managing Director and Head of Alternative and Absolute Return
Investments
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6
No officer or Trustee of the Trust is an officer, employee or partner of
Columbia or owns interests in, or has a material direct interest in, Columbia.
Columbia currently serves as investment adviser to the following mutual funds
and employs substantially similar investment strategies in managing the assets
of such funds as Columbia will employ in managing the assets of the Fund. These
funds, the annual advisory fees payable by the funds to Columbia, and their
approximate net assets are as follows:
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ANNUAL COMPENSATION TO NET ASSETS
FUND NAME COLUMBIA (AS A PERCENTAGE OF (AS OF 6/30/13)
AVERAGE DAILY NET ASSETS)
------------------------------------------------------------------------------------------------------------------------------------
Columbia Variable Portfolio - Select Large 0.710% on the first $500 million; $58,902,635
Cap Growth Fund 0.665% on the next $500 million;
0.620% on the next $500 million;
0.570% on the next $1.5 billion
0.560% on the next $3 billion
0.540% on assets over $6 billion
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Columbia Active Portfolios - Select Large 0.710% on the first $500 million; $1,235,996,398
Cap Growth Fund 0.665% on the next $500 million;
0.620% on the next $500 million;
0.570% on the next $1.5 billion
0.560% on the next $3 billion
0.540% on assets over $6 billion
------------------------------------------------------------------------------------------------------------------------------------
Columbia Select Large Cap Growth Fund 0.710% on the first $500 million; $5,329,602,914
0.665% on the next $500 million;
0.620% on the next $500 million;
0.570% on the next $1.5 billion
0.560% on the next $3 billion
0.540% on assets over $6 billion
------------------------------------------------------------------------------------------------------------------------------------
BOARD CONSIDERATIONS IN APPROVING THE COLUMBIA SUB-ADVISORY AGREEMENT
At the Board Meeting held on August 12, 2013, the Board, including all of the
Independent Trustees, unanimously approved the Columbia Sub-Advisory Agreement
and recommended the approval of the Columbia Sub-Advisory Agreement to the
Fund's shareholders. When considering the approval of the Columbia Sub-Advisory
Agreement, the Trustees reviewed materials furnished by BSCM and Columbia and
considered the Board's fiduciary obligations and the standards to be used by
the Board in reaching its decision. In considering whether to approve the
Columbia Sub-Advisory Agreement, the Board considered and discussed information
and analysis provided by BSCM and Columbia. BSCM also explained the specific
reasons for its recommendation to hire Columbia, which are described above.
BSCM also explained that the Proposal would need to be approved by the Fund's
shareholders, which
7
would involve a proxy solicitation and a special shareholders' meeting, and
informed the Board that the Fund would bear the expenses associated with such
solicitation and meeting.
In preparation for the Board Meeting, the Board requested and received written
materials from Columbia and BSCM that addressed, among other things, the
following topics (a) the nature and quality of Columbia's proposed investment
management and other services; (b) Columbia's investment management personnel;
(c) Columbia's operations and assets under management; (d) Columbia's brokerage
practices (including any soft dollar arrangements) and investment strategies;
(e) Columbia's compliance and risk management systems; (f) the current
investment strategies employed by BSCM and BNP in their management of the Fund;
(g) Columbia's reputation, expertise and resources in financial markets; and
(h) the past performance of a composite of accounts managed by Columbia
pursuant to similar investment strategies and policies as those pursuant to
which Columbia will use in managing the Fund's assets allocated to it.
In addition, at the Board Meeting, BSCM and Columbia presented additional oral
and written information to the Board to help the Board evaluate the quality and
costs of Columbia's proposed investment sub-advisory services. At the Board
Meeting, the Board had the opportunity to ask questions and request further
information regarding the appointment of Columbia as a sub-adviser to the Fund.
The Board also met with counsel outside the presence of BSCM and Columbia to
discuss its considerations with respect to the Columbia Sub-Advisory
Agreement.
In connection with the approval of the Columbia Sub-Advisory Agreement, the
Board considered the following factors:
o NATURE, EXTENT AND QUALITY OF SERVICES
The Board considered the nature, extent and quality of the services to be
provided by Columbia to the Fund and the resources it would dedicate to the
Fund. In this regard, the Trustees evaluated, among other things, Columbia's
portfolio management personnel, experience and compliance program. The Trustees
considered Columbia's expertise and performance history, Columbia's portfolio
management team, and Columbia's strength in large cap growth investment
strategies, which coincides with the Fund's investment objectives. Following
its evaluation, the Board concluded that, within the context of its full
deliberations, the nature, extent and quality of services to be provided by
Columbia to the Fund and the resources of Columbia to be dedicated to the Fund
supported approval of the Columbia Sub-Advisory Agreement.
o INVESTMENT PERFORMANCE
The Board considered the written information provided by Columbia regarding the
historical investment performance of a composite of accounts managed by
Columbia pursuant to similar investment strategies and policies as Columbia
would use in managing the Fund's assets allocated to it by BSCM. Following
evaluation, the Board concluded that, within the context of its full
deliberations, that the historical investment performance of Columbia and its
investment management personnel, considering both recent and long-term
performance, supported approval of the Columbia Sub-Advisory Agreement.
8
o COSTS OF SUB-ADVISORY SERVICES
The Board reviewed the proposed sub-advisory fee to be paid by BSCM to
Columbia. The Board reviewed information with respect to the investment
advisory fees charged by Columbia to its other clients for similar services.
The Board took into account the fact that Columbia will be compensated by BSCM,
and not by the Fund, and that BSCM's advisory fee with respect to the Fund will
not increase in connection with the appointment of Columbia as a sub-adviser to
the Fund. The Board also took into account that the proposed sub-advisory fee
reflected an arms-length negotiation between Columbia and BSCM, acting on
behalf of the Fund. Following evaluation, the Board concluded that, within the
context of its full deliberations, the proposed sub-advisory fee to be paid by
BSCM to Columbia is reasonable in light of the extent and quality of the
services (and the costs of such services) expected to be provided to the Fund
by Columbia and supported approval of the Columbia Sub-Advisory Agreement.
o PROFITS TO BE REALIZED BY COLUMBIA AND ECONOMIES OF SCALE
The Board did not make any conclusions regarding Columbia's profitability with
respect to its services to the Fund or economies of scale to be realized by
Columbia associated with its appointment as a sub-adviser to the Fund in light
of the fact that Columbia had not yet begun to provide the services to the Fund
and incur the actual costs of such services. The Board determined that it will
consider Columbia's profitability and whether any economies of scale are being
realized by Columbia during future considerations of Columbia's sub-advisory
agreement
o CONCLUSIONS
While formal Board action was not taken with respect to the conclusions
discussed above, those conclusions formed, in part, the basis for the Board's
approval of the Columbia Sub-Advisory Agreement. The Board concluded, in the
exercise of its reasonable judgment, that the terms of the Columbia
Sub-Advisory Agreement, including the compensation to be paid thereunder, are
reasonable in relation to the services (and the costs of such services)
expected to be provided by Columbia to the Fund and that the appointment of
Columbia and the approval of the Columbia Sub-Advisory Agreement would be in
the best interest of the Fund and its shareholders. Based on the Trustees'
deliberations and their evaluation of the information described above and other
factors and information they believed relevant, the Board, including all of the
Independent Trustees, unanimously approved (a) the appointment of Columbia as a
sub-adviser to the Fund; (b) the Columbia Sub-Advisory Agreement; and (c)
recommending the approval of the Columbia Sub-Advisory Agreement to the Fund's
shareholders.
In evaluating the factors and conclusions discussed above, shareholders should
consider:
o In reaching its determination regarding the approval of the Columbia
Sub-Advisory Agreement, the Board, including all of the Independent
Trustees, considered the factors, conclusions and information they
believed relevant in the exercise of their reasonable judgment,
including, but not limited to, the factors, conclusions and
information discussed above; and
o In their deliberations, the Board members did not identify any
particular factor (or conclusion with respect thereto) or information
that was all important or controlling, and each Board member may have
attributed different weights to the various factors (and conclusions
with respect thereto) and information.
9
THE TRUSTEES UNANIMOUSLY RECOMMEND THAT SHAREHOLDERS OF THE FUND VOTE TO APPROVE
THE PROPOSAL.
10
ADDITIONAL INFORMATION
INFORMATION ABOUT BSCM
BSCM serves as the investment adviser to the Fund. BSCM, a Hawaii corporation
established in 1999, is an investment adviser registered under the Advisers
Act. BSCM has a principal place of business located at 999 Bishop Street, 28th
Floor, Honolulu, Hawaii 96813. As of September 11, 2013, BSCM had approximately
$341 million in assets under management.
The following table shows: (i) the dollar amount of fees paid to BSCM by the
Fund; and (ii) the dollar amount of BSCM's voluntary fee waivers, each for the
fiscal year ended December 31, 2012:
------------------------------------------------------------------------------------------------------
FUND NAME ADVISORY FEES PAID ADVISORY FEES WAIVED
------------------------------------------------------------------------------------------------------
Bishop Street Strategic Growth Fund $370,377 $0
------------------------------------------------------------------------------------------------------
INFORMATION ABOUT OTHER SERVICE PROVIDERS
SEI Investments Global Funds Services ("SEIGFS") serves as the Fund's
administrator. SEI Investments Distribution Co. ("SIDCO") serves as the Fund's
distributor and principal underwriter. SIDCO receives no compensation for
distributing Fund shares. SEIGFS and SIDCO are located at One Freedom Valley
Drive, Oaks, Pennsylvania 19456.
The following table shows: (i) the dollar amount of fees paid to SEIGFS by the
Fund; and (ii) the dollar amount of SEIGFS' voluntary fee waivers, each for the
fiscal year ended December 31, 2012:
------------------------------------------------------------------------------------------------------
FUND NAME ADMINISTRATION FEES PAID ADMINISTRATION FEES WAIVED
------------------------------------------------------------------------------------------------------
Bishop Street Strategic Growth Fund $100,102 $40,041
------------------------------------------------------------------------------------------------------
PAYMENT OF EXPENSES
The Fund will pay the expenses of the preparation, printing and mailing of this
proxy statement and its enclosures and of all related solicitations. These
expenses are expected to be approximately $4,000.
COMMISSIONS PAID TO AFFILIATED BROKERS
For the fiscal year ended December 31, 2012, the Fund did not pay any brokerage
commissions on portfolio transactions effected by affiliated brokers.
BENEFICIAL OWNERSHIP OF SHARES AND SECURITY OWNERSHIP OF MANAGEMENT
As of the Record Date, the following persons owned of record, or were known by
the Trust to own beneficially, more than 5% of the Institutional Class Shares
of the Fund. On that date, the Trustees and officers of the Trust, together as
a group, beneficially owned less than 1% of the Fund's outstanding shares.
NAME AND ADDRESS NUMBER OF SHARES PERCENT
--------------------------------------------------------------------------------
SEI Private Trust c/o First Hawaii Bank
One Freedom Valley Drive, Oaks, PA 19456 2,120,386.022 64.19
SEI Private Trust c/o First Hawaii Bank
One Freedom Valley Drive, Oaks, PA 19456 820,647.134 24.84
Mercer Trust Company TTEE FBO Bancwest
Corporation 401K Savings Plan
1 Investors Way MSC N-2-G, Norwood, MA 02062 275,767.365 8.35
--------------------------------------------------------------------------------
11
The information as to beneficial ownership is based on statements furnished to
the Fund by the Trustees of the Trust, and/or on the records of the Trust's
transfer agent.
ANNUAL REPORT TO SHAREHOLDERS
Shareholders may receive a free copy of the Fund's annual report for the fiscal
year ended December 31, 2012 on the Fund's website at WWW.BISHOPSTREETFUNDS.COM
or by calling 1-800-262-9565 or by writing to the Fund at Bishop Street Funds,
c/o DST Systems, Inc., 430 W. 7th Street, Kansas City, MO 64105.
SUBMISSION OF SHAREHOLDER PROPOSALS
The Trust is organized as a voluntary association under the laws of the
Commonwealth of Massachusetts. As such, the Trust is not required to, and does
not, hold annual meetings. Nonetheless, the Board of Trustees may call a
special meeting of shareholders for action by shareholder vote as may be
required by the 1940 Act or as required or permitted by the Declaration of
Trust and By-Laws of the Trust. Shareholders of the Fund who wish to present a
proposal for action at a future meeting should submit a written proposal to the
Trust for inclusion in a future proxy statement. Shareholders retain the right
to request that a meeting of the shareholders be held for the purpose of
considering matters requiring shareholder approval. Submission of a proposal
does not necessarily mean that such proposal will be included in the Fund's
proxy statement since inclusion in the proxy statement is subject to compliance
with certain federal regulations.
VOTING AND OTHER MATTERS
If you wish to participate in the Meeting, you may submit the proxy card
included with this proxy statement or attend in person. Your vote is important
no matter how many Shares you own. You can vote easily and quickly by mail, by
Internet, by telephone or in person. At any time before the Meeting, you may
change your vote, even though a proxy has already been returned, by sending a
written notice to the Trust or by submitting a subsequent proxy by mail, by
Internet, or by telephone or by voting in person at the meeting. Should
shareholders require additional information regarding the proxy or replacement
proxy cards, they may contact the Fund at 1-800-262-9565.
The solicitation of proxies will be largely by mail, but may include
telephonic, Internet or oral communication by officers and service providers of
the Trust, including BSCM, who will not be paid for these services. The costs
of the solicitation of proxies and the costs of holding the Meeting will be
borne by the Fund.
All proxy cards solicited that are properly executed and received in time to be
voted at the Meeting will be voted at the Meeting or any adjournment thereof
according to the instructions on the proxy card. IF NO SPECIFICATION IS MADE ON
A PROXY CARD, IT WILL BE VOTED FOR THE MATTERS SPECIFIED ON THE PROXY CARD.
If your Shares are held of record by a broker-dealer and you wish to vote in
person at the Meeting, you should obtain a legal proxy from your broker of
record and present it to the Inspector of Elections at the Meeting. The
presence in person or by proxy of shareholders of the Fund holding a majority
of the total number of votes eligible to be cast by all shareholders of the
Fund as of the Record Date constitutes a quorum. For purposes of determining
the presence of a quorum, abstentions or broker non-votes will be counted as
present; however, they will have the effect of a vote AGAINST the Proposal.
As used above, "broker non-votes" relate to shares that are held of record by a
broker-dealer for a beneficial owner who has not given instructions to such
broker-dealer. Pursuant to certain rules
12
promulgated by the New York Stock Exchange LLC that govern the voting by such
broker-dealers, a broker-dealer holding shares of record for a beneficial owner
may not exercise discretionary voting power with respect to certain non-routine
matters, including the approval of a new investment management agreement as
contemplated by the Proposal.
If a quorum is not present at the Meeting, or if a quorum is present at the
Meeting but sufficient votes to approve the Proposal are not received, or if
other matters arise requiring shareholder attention, the persons named as proxy
agents may propose one or more adjournments of the Meeting to permit further
solicitation of proxies. Except when a quorum is not present at the Meeting,
any such adjournment will require the affirmative vote of a majority of those
Shares present at the Meeting or represented by proxy. Abstentions and "broker
non-votes" will not be counted for or against such proposal to adjourn. The
persons named as proxy agents will vote those proxies that they are entitled to
vote FOR such Proposal in favor of such an adjournment, and will vote those
proxies required to be voted AGAINST such Proposal, against such an
adjournment. The Fund will bear the costs of any additional solicitation or any
adjourned sessions.
No business other than the matter described above is expected to come before
the Meeting, but should any matter incident to the conduct of the Meeting or
any question as to an adjournment of the Meeting arise, the persons named in
the enclosed proxy will vote thereon according to their best judgment in the
interest of the Trust.
SHAREHOLDERS WHO DO NOT EXPECT TO BE PRESENT AT THE MEETING AND WHO WISH TO
HAVE THEIR SHARES VOTED ARE REQUESTED TO VOTE BY MAIL, TELEPHONE OR INTERNET AS
EXPLAINED IN THE INSTRUCTIONS INCLUDED ON YOUR PROXY CARD.
By Order of the Trustees,
/s/ Michael Beattie
Michael Beattie
President
13
APPENDIX A
FORM OF
AMENDED AND RESTATED SUB-ADVISORY AGREEMENT
AMENDED AND RESTATED SUB-ADVISORY AGREEMENT (the "Agreement") made as
of this ___ day of ________, 20___ by and between BISHOP STREET CAPITAL
MANAGEMENT, a Hawaii corporation with its principal place of business at 999
Bishop Street, 28th Floor, Honolulu, Hawaii 96813 (the "Adviser"), and COLUMBIA
MANAGEMENT INVESTMENT ADVISERS, LLC, a Delaware limited liability company with
its principal place of business at 100 Federal Street, Boston, MA 02111 (the
"Sub-Adviser"). The Adviser is a direct subsidiary of First Hawaiian Bank.
W I T N E S S E T H
WHEREAS, BISHOP STREET FUNDS (the "Trust") and First Hawaiian Bank
entered into an Investment Advisory Agreement dated March 31, 1999 (the
"Management Agreement");
WHEREAS, the Adviser and First Hawaiian Bank entered into Assignment
and Assumption Agreement dated February 22, 2000 whereby the Adviser assumed
the Management Agreement and the obligations contained therein;
WHEREAS, pursuant to authority granted to the Adviser by the Board of
Trustees (the "Board") of the Trust on behalf of the series set forth on
Schedule A to this Agreement (the "Funds") and pursuant to the provisions of
the Management Agreement, the Adviser has selected the Sub-Adviser to act as
sub-investment adviser of the Funds and to provide certain related services, as
more fully set forth below, and to perform such services under the terms and
conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the mutual covenants and benefits
set forth herein, the Adviser and the Sub-Adviser do hereby agree as follows:
1. THE SUB-ADVISER'S SERVICES.
(a) DISCRETIONARY INVESTMENT MANAGEMENT SERVICES. The Sub-Adviser
shall act as sub-investment adviser with respect to the Funds. In such
capacity, the Sub-Adviser shall, subject to the supervision of the Adviser
and the Board, regularly provide each Fund with investment research, advice
and supervision and shall furnish continuously an investment program for
such Fund assets as may be allocated by the Adviser to the Sub-Adviser for
purposes of investing Fund assets, consistent with the investment
objectives and policies of each Fund. The Sub-Adviser shall determine, from
time to time, what investments shall be purchased for the Funds and what
such securities shall be held or sold by the Funds, subject always to the
provisions of the Trust's Agreement and Declaration of Trust, By-Laws and
its registration statement on Form N-1A (the "Registration Statement")
under the Investment Company Act of 1940, as amended (the "1940 Act"), and
under the Securities Act of 1933, as amended (the "1933 Act"), covering
Fund shares, as filed with the Securities and Exchange Commission (the
"Commission"), and to the investment objectives, policies and restrictions
of the Funds, as each of the same shall be from time to time in effect and
set forth in the Registration Statement. To carry out such obligations, the
Sub-Adviser shall exercise full discretion and act for each Fund in the
same manner and with the same force and effect as each Fund itself might or
could do with respect to purchases, sales or other transactions and is
hereby appointed each Fund's agent and
A-1
attorney-in-fact for the limited purposes of executing account
documentation, agreements, contracts and other documents as the Sub-Adviser
shall be required by brokers, dealers, counterparties and other persons in
connection with the Sub-Adviser's management of each Fund. Notwithstanding
the foregoing, the Adviser may, pursuant to the Management Agreement and
upon prior written instructions from the Adviser, effect such portfolio
transactions for each Fund as the Adviser may from time to time determine;
provided however, that the Sub-Adviser shall not be responsible for any
such portfolio transactions effected by the Adviser. No reference in this
Agreement to the Sub-Adviser having full discretionary authority over each
Fund's investments shall in any way limit the right of the Adviser, in its
sole discretion, to establish or revise policies in connection with the
management of each Fund's assets or to otherwise exercise its right to
control the overall management of each Fund's assets.
(b) COMPLIANCE. In the performance of its duties and obligations under
this Agreement, the Sub-Adviser agrees to comply in all material respects
with the requirements of the 1940 Act, the Investment Advisers Act of 1940,
as amended (the "Advisers Act"), the 1933 Act, the Securities Exchange Act
of 1934, as amended (the "1934 Act"), the Commodity Exchange Act and the
respective rules and regulations thereunder, as applicable, as well as with
all other applicable federal and state laws, rules, regulations and case
law that relate to the services and relationships described hereunder and
to the conduct of its business as a registered investment adviser. The
Sub-Adviser also agrees to comply with the objectives, policies and
restrictions set forth in the Registration Statement, as amended or
supplemented, of the Funds, and with any written policies, guidelines,
instructions and procedures approved by the Board or the Adviser and
provided to the Sub-Adviser. In selecting each Fund's portfolio securities
and performing the Sub-Adviser's obligations hereunder, the Sub-Adviser
shall cause each Fund to comply with the diversification and source of
income requirements of Subchapter M of the Internal Revenue Code of 1986,
as amended (the "Code"), for qualification as a regulated investment
company. With respect to compliance with the requirements of Subchapter M
of the Code, the Adviser shall cause each Fund to provide to the
Sub-Adviser such records as the Sub-Adviser may reasonably request. The
Adviser has furnished the Sub-Adviser with the Trust's current Declaration
of Trust and Bylaws, the Funds' current prospectus and Statement of
Additional Information and any other policies, guidelines, instructions and
procedures relevant to the Sub-Adviser's services under this Agreement and
shall deliver, or cause to be delivered, to the Sub-Adviser all changes to
such documents and instruments a reasonable period of time prior to their
effectiveness. The Sub-Adviser has adopted and implemented, and will
maintain, written compliance policies and procedures that it believes are
reasonably designed to prevent violations by the Sub-Adviser and its
"supervised persons" (as defined in the Advisers Act) of the Advisers Act
and the rules thereunder. The Sub-Adviser will review, no less frequently
than annually, the adequacy of its policies and procedures and the
effectiveness of their implementation. The Sub-Adviser has designated a
Chief Compliance Officer responsible for administering its policies and
procedures. No supervisory activity undertaken by the Adviser shall limit
the Sub-Adviser's full responsibility for any of the foregoing.
(c) PROXY VOTING. Pursuant to Board authority and the Management
Agreement, the Adviser has the authority and responsibility to vote proxies
relating to securities held by the Funds and may delegate that authority
and responsibility to a third party. The Adviser hereby delegates the
authority and responsibility to vote proxies for the Funds' securities to
the Sub-Adviser. The Sub-Adviser represents that it has adopted and
implemented, and will maintain, written policies and procedures that it
believes are reasonably designed to ensure that it votes the Funds'
securities in the best interests of the Funds, including procedures to
address material conflicts that may arise between the interests of the
Sub-Adviser and those of the Funds. The
A-2
Sub-Adviser shall carry out the responsibility to vote proxies relating to
the securities held by the Funds in accordance with written instructions,
if any, that the Board or the Adviser may provide from time to time and
shall provide such reports and keep such records relating to proxy voting
as the Board may reasonably request or as may be necessary for the Funds to
comply with the 1940 Act and other applicable law. The delegation of proxy
voting authority and responsibility to the Sub-Adviser may be revoked or
modified by the Board or the Adviser at any time.
The Sub-Adviser is authorized to instruct the Custodian and/or
broker(s) for the Funds to forward promptly to the Sub-Adviser or
designated service provider copies of all proxies and shareholder
communications relating to securities held in the portfolio of the Funds
(other than materials relating to legal proceedings against the Funds). The
Sub-Adviser may also instruct the Custodian and/or broker(s) to provide
reports of holdings in the portfolios of the Funds. The Sub-Adviser has the
authority to engage a service provider to assist with administrative
functions related to voting Fund proxies. The Trust shall direct the
Custodian and/or broker(s) to provide assistance requested by the
Sub-Adviser in facilitating the use of a service provider. In no event
shall the Sub-Adviser have any responsibility to vote proxies that are not
received on a timely basis. The Adviser acknowledges that the Sub-Adviser,
consistent with the Sub-Adviser's written proxy voting policies and
procedures, may refrain from voting a proxy if, in the Sub-Adviser's
discretion, refraining from voting would be in the best interests of each
Fund and its shareholders or as otherwise may be provided in the
Sub-Adviser's written proxy voting policies and procedures.
(d) RECORDKEEPING. The Sub-Adviser shall not be responsible for the
provision of administrative, bookkeeping or accounting services to the
Funds, except as otherwise provided herein or as may be necessary for the
Sub-Adviser to supply to the Adviser, the Funds or the Board the
information required to be supplied under this Agreement.
The Sub-Adviser shall maintain separate books and detailed records of
all matters pertaining to each Fund's assets advised by the Sub-Adviser
required by subparagraphs (b)(5), (6), (7), (9), (10) and (11) and
paragraph (f) of Rule 31a-1 under the 1940 Act (other than those records
being maintained by the Adviser, any administrator, custodian, transfer
agent or other service provider appointed by the Funds) relating to its
responsibilities provided hereunder with respect to the Funds, and shall
preserve such records for the periods and in a manner prescribed therefore
by Rule 31a-2 under the 1940 Act (the "Fund Books and Records"). The Fund
Books and Records shall be available to the Adviser and the Board upon
reasonable request and shall be delivered to the Funds upon the termination
of this Agreement and shall be available for telecopying without
unreasonable delay during any day the Funds are open for business.
(e) HOLDINGS INFORMATION AND PRICING. The Sub-Adviser shall provide
regular reports regarding each Fund's holdings, and may, on its own
initiative, furnish the Funds and the Adviser from time to time with
whatever information the Sub-Adviser believes is appropriate for this
purpose. The Sub-Adviser agrees to notify the Adviser promptly if the
Sub-Adviser reasonably believes that the value of any security held by the
Funds may not reflect fair value. The Sub-Adviser agrees to provide upon
request any pricing information of which the Sub-Adviser is aware to the
Adviser and/or the Fund pricing agent to assist in the determination of the
fair value of the Fund holdings for which market quotations are not readily
available or as otherwise required in accordance with the 1940 Act or the
Fund valuation procedures for the purpose of calculating each Fund's net
asset value in accordance with procedures and methods established by the
Board.
A-3
(f) COOPERATION WITH AGENTS OF THE ADVISER AND THE FUNDS. The
Sub-Adviser agrees to reasonably cooperate with and provide reasonable
assistance to the Adviser, the Funds and the Funds' custodian and foreign
sub-custodians, the Funds' pricing agents and all other agents and
representatives of the Funds and the Adviser, such information with respect
to each Fund as such entities may reasonably request from time to time in
the performance of their obligations, provide prompt responses to
reasonable requests made by such persons and establish appropriate
interfaces with each so as to promote the efficient exchange of information
and compliance with applicable laws and regulations.
2. CODE OF ETHICS. The Sub-Adviser has adopted a written code of
ethics that it reasonably believes complies with the requirements of Rule 17j-1
under the 1940 Act (the "Code of Ethics"), which it will provide to the Adviser
and the Funds. The Sub-Adviser shall ensure that it has adopted procedures
reasonably necessary to prevent its Access Persons (as defined in Rule 17j-1)
from violating the Sub-Adviser's Code of Ethics, as in effect from time to
time. Upon request, the Sub-Adviser shall provide the Funds with (i) a copy of
the Sub-Adviser's current Code of Ethics, as in effect from time to time, and
(ii) a certification that it has adopted procedures reasonably necessary to
prevent Access Persons from engaging in any conduct prohibited by the
Sub-Adviser's Code of Ethics. Annually, upon request, the Sub-Adviser shall
furnish a written report, which complies with the requirements of Rule 17j-1,
concerning the Sub-Adviser's Code of Ethics to the Trust and the Adviser. The
Sub-Adviser shall respond to requests for information from the Adviser as to
material violations of the Code of Ethics by Access Persons and the sanctions
imposed by the Sub-Adviser in response to such material violations.
3. INFORMATION AND REPORTING. The Sub-Adviser shall provide the
Funds, the Adviser, and their respective officers with such periodic reports
concerning the obligations the Sub-Adviser has assumed under this Agreement as
the Funds and the Adviser may from time to time reasonably request.
(a) NOTIFICATION OF BREACH / COMPLIANCE REPORTS. The Sub-Adviser shall
notify the Trust's Chief Compliance Officer and Adviser promptly upon
detection of (i) any material failure to manage each Fund in accordance
with its investment objectives and policies or any applicable law; or (ii)
any material breach of any of a Fund's written policies, guidelines or
procedures provided to the Sub-Adviser. In addition, the Sub-Adviser shall
provide a quarterly report regarding each Fund's compliance with its
investment objectives and policies and applicable law and each Fund's
policies, guidelines or procedures as applicable to the Sub-Adviser's
obligations under this Agreement. The Sub-Adviser acknowledges and agrees
that the Adviser may, in its discretion, provide such quarterly compliance
certifications to the Board. The Sub-Adviser shall also provide the
officers of the Trust with supporting certifications in connection with
such certifications of Fund financial statements and disclosure controls
pursuant to the Sarbanes-Oxley Act. The Sub-Adviser will promptly notify
the Trust in the event (i) the Sub-Adviser 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 Trust (excluding class action suits in which a Fund is a
member of the plaintiff class by reason of the Fund's ownership of shares
in the defendant) or the compliance by the Sub-Adviser with the federal or
state securities laws if such actions, suits, proceedings, inquiries or
investigations would reasonably be expected to have a material adverse
effect on the Sub-Adviser's ability to perform its services hereunder or
(ii) the controlling stockholder of the Sub-Adviser changes or an actual
change in control resulting in an "assignment" (as defined in the 1940 Act)
has occurred or is otherwise proposed to occur.
(b) INSPECTION. Upon reasonable request, the Sub-Adviser agrees to
make its records and premises (including the availability of the
Sub-Adviser's employees for interviews) to the
A-4
extent that they relate to the conduct of services provided to the Funds
reasonably available for compliance audits by the Adviser's or the Funds'
employees, accountants or counsel; in this regard, the Funds and the
Adviser acknowledge that the Sub-Adviser shall have no obligations to make
available proprietary information unrelated to the services provided to the
Funds or any information related to other clients of the Sub-Adviser,
except to the extent necessary for the Adviser to confirm compliance with
any laws, rules or regulations in the management of the Funds.
(c) BOARD AND FILINGS INFORMATION. The Sub-Adviser will also provide
the Adviser with any information reasonably requested regarding its
management of the Funds required for any meeting of the Board, or for any
shareholder report, Form N-CSR, Form N-Q, Form N-PX, Form N-SAR, amended
registration statement, proxy statement, or prospectus supplement to be
filed by the Funds with the Commission. The Sub-Adviser will make its
officers and employees available to meet with the Board from time to time
on due notice to review its investment management services to the Funds in
light of current and prospective economic and market conditions and shall
furnish to the Board such information as may reasonably be necessary in
order for the Board to evaluate this Agreement or any proposed amendments
thereto.
(d) TRANSACTION INFORMATION. The Sub-Adviser shall furnish to the
Adviser such information concerning portfolio transactions as may be
necessary to enable the Adviser to perform such compliance testing on the
Funds and the Sub-Adviser's services as the Adviser may, in its sole
discretion, determine to be appropriate. The provision of such information
by the Sub-Adviser in no way relieves the Sub-Adviser of its own
responsibilities under this Agreement.
4. BROKERAGE.
(a) PRINCIPAL TRANSACTIONS. In connection with purchases or sales of
securities for the accounts of the Funds, neither the Sub-Adviser nor any
of its directors, officers or employees will act as a principal or agent or
receive any commission except as permitted by the 1940 Act.
(b) PLACEMENT OF ORDERS. The Sub-Adviser shall arrange for the placing
of all orders for the purchase and sale of securities for each Fund's
account with brokers or dealers selected by the Sub-Adviser. In executing
Fund transactions and selecting brokers or dealers, the Sub-Adviser will
use its best efforts to seek on behalf of the Funds the best overall terms
available. In assessing the best overall terms available for any
transaction, the Sub-Adviser shall consider all factors that it deems
relevant, including the breadth of the market in the security, the price of
the security, the financial condition and execution capability of the
broker or dealer, and the reasonableness of the commission, if any, both
for the specific transaction and on a continuing basis. In evaluating the
best overall terms available, and in selecting the broker-dealer to execute
a particular transaction, the Sub-Adviser may also consider the brokerage
and research services provided (as those terms are defined in Section 28(e)
of the Securities Exchange Act of 1934 (the "Exchange Act")). Consistent
with any guidelines established by the Board of Trustees of the Trust and
Section 28(e) of the Exchange Act, the Sub-Adviser is authorized to pay to
a broker or dealer who provides such brokerage and research services a
commission for executing a portfolio transaction for the Funds which is in
excess of the amount of commission another broker or dealer would have
charged for effecting that transaction if, but only if, the Sub-Adviser
determines in good faith that such commission was reasonable in relation to
the value of the brokerage and research services provided by such broker or
dealer -- viewed in terms of that particular transaction or in terms of the
overall responsibilities of the Sub-Adviser to its discretionary clients,
including the Funds. It is understood that the services provided by such
A-5
brokers may be useful to the Sub-Adviser in connection with its or its
affiliates' services to other clients.
(c) AGGREGATED TRANSACTIONS. On occasions when the Sub-Adviser deems
the purchase or sale of a security to be in the best interest of the Funds
as well as other clients of the Sub-Adviser, the Sub-Adviser may, to the
extent permitted by applicable law and regulations, aggregate the order for
securities to be sold or purchased. In such event, the Sub-Adviser will
allocate securities or futures contracts so purchased or sold, as well as
the expenses incurred in the transaction, in the manner the Sub-Adviser
reasonably considers to be equitable, over time, and consistent with its
fiduciary obligations to the Funds and to such other clients under the
circumstances.
(d) AFFILIATED BROKERS. The Sub-Adviser or any of its affiliates may
act as broker in connection with the purchase or sale of securities or
other investments for the Funds, subject to: (a) the requirement that the
Sub-Adviser seek to obtain best execution and price within the policy
guidelines determined by the Board and set forth in the Funds' current
prospectus and SAI; (b) the provisions of the 1940 Act; (c) the provisions
of the Advisers Act; (d) the provisions of the 1934 Act; and (d) other
provisions of applicable law. These brokerage services are not within the
scope of the duties of the Sub-Adviser under this Agreement. Subject to the
requirements of applicable law and any procedures adopted by the Board, the
Sub-Adviser or its affiliates may receive brokerage commissions, fees or
other remuneration from the Funds for these services in addition to the
Sub-Adviser's fees for services under this Agreement.
5. CUSTODY. Nothing in this Agreement shall permit the Sub-Adviser to take
or receive physical possession of cash, securities or other investments of the
Funds.
6. ALLOCATION OF CHARGES AND EXPENSES. The Sub-Adviser will bear its own
costs of providing services hereunder. Other than as herein specifically
indicated, the Sub-Adviser shall not be responsible for the Funds' or the
Adviser's expenses, including without limitation brokerage and other expenses
incurred in placing orders for the purchase and sale of securities and other
investment instruments.
7. REPRESENTATIONS, WARRANTIES AND COVENANTS.
(a) PROPERLY REGISTERED. The Sub-Adviser is registered as an
investment adviser under the Advisers Act, and will remain so registered
for the duration of this Agreement. The Sub-Adviser is not prohibited by
the Advisers Act or the 1940 Act from performing the services contemplated
by this Agreement, and to the best knowledge of the Sub-Adviser, there is
no proceeding or investigation regarding the Sub-Adviser that is reasonably
likely to result in the Sub-Adviser being prohibited from performing the
services contemplated by this Agreement. The Sub-Adviser agrees to promptly
notify the Trust of the occurrence of any event that would disqualify the
Sub-Adviser from serving as an investment adviser to an investment company.
The Sub-Adviser is in compliance in all material respects with all
applicable federal and state law in connection with its investment
management operations.
(b) ADV DISCLOSURE. The Sub-Adviser has provided the Trust with a copy
of its Form ADV Part I as most recently filed with the SEC and its current
Part 2 and will, promptly after filing any amendment to its Form ADV with
the SEC or updating its Part 2, furnish a copy of such amendments or
updates to the Trust and the Adviser. The information contained in the
Adviser's Form ADV is accurate and complete in all material respects and
does not omit to state
A-6
any material fact necessary in order to make the statements made, in light
of the circumstances under which they were made, not misleading.
(c) FUND DISCLOSURE DOCUMENTS. The Sub-Adviser has reviewed the
current prospectus and Statement of Additional Information of the Funds and
represents and warrants that with respect to disclosure about the
Sub-Adviser, the manner in which the Sub-Adviser will manage the Funds or
information relating directly or indirectly to the Sub-Adviser, such
prospectus and Statement of Additional Information contain or will contain,
as of the date thereof, no untrue statement of any material fact and does
not omit any statement of material fact which was required to be stated
therein or necessary to make the statements contained therein not
misleading. The Sub-Adviser, upon request, will in the future review the
Registration Statement, and any amendments or supplements thereto, the
annual or semi-annual reports to shareholders, other reports filed with the
Commission and any marketing material of the Funds (collectively the
"Disclosure Documents") and will certify as to whether or not disclosure
about the Sub-Adviser, the manner in which the Sub-Adviser manages the
Funds or information relating directly or indirectly to the Sub-Adviser,
such Disclosure Documents contain or will contain, as of the date thereof,
no untrue statement of any material fact and does not omit any statement of
material fact which was required to be stated therein or necessary to make
the statements contained therein not misleading.
(d) USE OF NAMES. The Sub-Adviser has the right to use the names
"Bishop Street Capital Management" and "Bishop Street Funds" in connection
with its services to the Trust and that the Trust and the Adviser shall
have the right to use the name "Columbia Management" in connection with the
management and operation of the Funds. The Sub-Adviser is not aware of any
threatened or existing actions, claims, litigation or proceedings that
would adversely affect or prejudice the rights of the Sub-Adviser or the
Trust to use the name "Columbia Management."
(e) INSURANCE. The Sub-Adviser maintains errors and omissions
insurance coverage in an appropriate amount and shall provide prior written
notice to the Trust (i) of any material changes in its insurance policies
or insurance coverage; or (ii) if any material claims will be made on its
insurance policies. Furthermore, the Sub-Adviser shall, upon reasonable
request, provide the Trust with any information it may reasonably require
concerning the amount of or scope of such insurance.
(f) NO DETRIMENTAL AGREEMENT. The Sub-Adviser represents and warrants
that it has no arrangement or understanding with any party, other than the
Trust, that would cause the Sub-Adviser to select securities for the Funds
in a manner that is not in the best interest of the Funds.
(g) CONFLICTS. The Sub-Adviser shall act honestly, in good faith and
in the best interests of the Trust including implementing procedures that
require any of its personnel responsible for management of the Funds to
place the interest of the Funds ahead of their own interests, in all
personal trading scenarios that may involve a conflict of interest with the
Funds, consistent with its fiduciary duties under applicable law.
(h) REPRESENTATIONS. The representations and warranties in this
Section 7 shall be deemed to be made on the date this Agreement is executed
and at the time of delivery of the quarterly compliance report required by
Section 3(a), whether or not specifically referenced in such report.
(i) The Adviser (i) is registered as an investment adviser under the
Advisers Act and
A-7
will remain so registered for the duration of this Agreement; (ii) is not
prohibited by the 1940 Act or the Advisers Act from performing the services
contemplated by this Agreement or the Management Agreement; (iii) 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 or the Management Agreement; (iv) has the authority to enter
into and perform the services contemplated by this Agreement; (v) will
promptly notify Subadviser of the occurrence of any event that would
disqualify the Adviser from serving as an investment adviser of an
investment company pursuant to Section 9(a) of the 1940 Act or otherwise;
and (vi) the Adviser and the Trust have duly entered into the Management
Agreement pursuant to which the Trust authorized the Adviser to enter into
this Agreement. The Adviser shall provide services to the Funds pursuant to
the Management Agreement in compliance with the terms thereof and in
accordance with applicable law.
8. SUB-ADVISER'S COMPENSATION. The Adviser shall pay to the Sub-Adviser, as
compensation for the Sub-Adviser's services hereunder, a fee, determined as
described in Schedule A that is attached hereto and made a part hereof. Such fee
shall be computed daily and paid monthly in arrears by the Adviser. The Funds
shall have no responsibility for any fee payable to the Sub-Adviser.
The Sub-Adviser will be compensated based on the portion of Fund assets
allocated to the Sub-Adviser by the Adviser. In the event of termination of this
Agreement, the fee provided in this Section shall be computed on the basis of
the period ending on the last business day on which this Agreement is in effect
subject to a pro rata adjustment based on the number of days elapsed in the
current month as a percentage of the total number of days in such month.
9. INDEPENDENT CONTRACTOR. In the performance of its duties hereunder, the
Sub-Adviser is and shall be an independent contractor and, unless otherwise
expressly provided herein or otherwise authorized in writing, shall have no
authority to act for or represent the Funds or the Adviser in any way or
otherwise be deemed to be an agent of the Funds or the Adviser. If any occasion
should arise in which the Sub-Adviser gives any advice to its clients concerning
the shares of the Funds, the Sub-Adviser will act solely as investment counsel
for such clients and not in any way on behalf of the Funds. It is understood
that the Sub-Adviser may give advice and take action for its other clients that
may differ from advice given, or the timing or nature of action taken, for the
Funds. The Sub-Adviser is not obligated to initiate transactions for the Funds
in any security that the Sub-Adviser, its principals, affiliates or employees
may purchase or sell for its or their own accounts or the accounts of other
clients.
10. ASSIGNMENT AND AMENDMENTS. This Agreement shall automatically
terminate, without the payment of any penalty, (i) in the event of its
assignment (as defined in section 2(a)(4) of the 1940 Act) or (ii) in the event
of the termination of the Management Agreement; provided that such termination
shall not relieve the Adviser or the Sub-Adviser of any liability incurred
hereunder.
This Agreement may not be added to or changed orally and may not be
modified or rescinded except by a writing signed by the parties hereto and in
accordance with the 1940 Act, when applicable.
11. DURATION AND TERMINATION.
(a) This Agreement shall become effective as of the date executed and
shall remain in full force and effect continually thereafter, subject to
renewal as provided in Section 11(c) and
A-8
unless terminated automatically as set forth in Section 10 hereof or until
terminated as follows:
(b) The Adviser may at any time terminate this Agreement by not more
than sixty (60) days' nor less than thirty (30) days' written notice
delivered or mailed by registered mail, postage prepaid, to the
Sub-Adviser. In addition, the Funds may cause this Agreement to terminate
either (i) by vote of its Board upon not more than sixty (60) days' nor
less than thirty (30) days' written notice or (ii) upon the affirmative
vote of a majority of the outstanding voting securities of the Funds; or
(c) The Sub-Adviser may at any time terminate this Agreement by not
more than sixty (60) days' nor less than thirty (30) days' written notice
delivered or mailed by registered mail, postage prepaid, to the Adviser; or
(d) This Agreement shall automatically terminate two years from the
date of its execution unless its renewal is specifically approved at least
annually thereafter by (i) a majority vote of the Trustees, including a
majority vote of such Trustees who are not interested persons of the Funds,
the Adviser or the Sub-Adviser, at a meeting called for the purpose of
voting on such approval; or (ii) the vote of a majority of the outstanding
voting securities of the Funds; provided, however, that if the continuance
of this Agreement is submitted to the shareholders of the Funds for their
approval and such shareholders fail to approve such continuance of this
Agreement as provided herein, the Sub-Adviser may continue to serve
hereunder as to the Funds in a manner consistent with the 1940 Act and the
rules and regulations thereunder; or
(e) This Agreement shall terminate automatically and immediately in
the event of the termination of the Management Agreement; and
(f) Termination of this Agreement pursuant to this Section shall be
without payment of any penalty.
In the event of termination of this Agreement for any reason, the
Sub-Adviser shall, immediately upon notice of termination or on such later
date as may be specified in such notice, cease all activity on behalf of
the Funds and with respect to any Fund assets, except as expressly directed
by the Adviser or as otherwise required by any fiduciary duties of the
Sub-Adviser under applicable law. In addition, the Sub-Adviser shall
deliver each Fund's Books and Records to the Adviser by such means and in
accordance with such schedule as the Adviser shall direct and shall
otherwise cooperate, as reasonably directed by the Adviser, in the
transition of portfolio asset management to any successor of the
Sub-Adviser, including the Adviser, provided, however, that the Sub-Adviser
is not required hereunder to provide investment advisory services in such a
transition. The Sub-Adviser may retain copies of each Fund's Books and
Records following termination of this Agreement to the extent required by
applicable law.
12. CERTAIN DEFINITIONS. FOR THE PURPOSES OF THIS AGREEMENT:
(a) "Affirmative vote of a majority of the outstanding voting
securities of the Funds" shall have the meaning as set forth in the 1940
Act, subject, however, to such exemptions as may be granted by the
Commission under the 1940 Act or any interpretations of the Commission
staff.
(b) "Interested persons" and "Assignment" shall have their respective
meanings as set forth in the 1940 Act, subject, however, to such exemptions
as may be granted by the Commission under the 1940 Act or any
interpretations of the Commission staff.
A-9
13. INDEMNIFICATION. The Sub-Adviser shall indemnify and hold harmless the
Trust and all affiliated persons thereof (within the meaning of Section 2(a)(3)
of the 1940 Act) and all their respective controlling persons (as described in
Section 15 of the 1933 Act) (collectively, the "Sub-Adviser Indemnitees")
against any and all losses, claims, damages, liabilities or litigation
(including reasonable legal and other expenses) by reason of or arising out of:
(a) the Sub-Adviser being in material violation of any applicable federal or
state law, rule or regulation or any investment policy or restriction set forth
in the Funds' Registration Statement or any written guidelines or instruction
provided in writing by the Board, (b) the Funds' failure to satisfy the
diversification or source of income requirements of Subchapter M of the Code, or
(c) the Sub-Adviser's willful misfeasance, bad faith, or gross negligence
generally in the performance of its duties hereunder or its reckless disregard
of its obligations and duties under this Agreement; provided, however, that the
Sub-Adviser Indemnitees shall not be indemnified for any losses, claims,
damages, liabilities or litigation sustained as a result of the Adviser's, the
Trust's, their officers', partners', employees', consultants' or agents' willful
misfeasance, bad faith, gross negligence or reckless disregard of the duties
under this Agreement or the Management Agreement or violation of applicable law.
The Adviser shall indemnify and hold harmless the Sub-Adviser and all affiliated
persons thereof (within the meaning of Section 2(a)(3) of the 1940 Act) and all
their respective controlling persons (as described in Section 15 of the 1933
Act) (collectively, the "Adviser Indemnitees") against any and all losses,
claims, damages, liabilities or litigation (including reasonable legal and other
expenses) by reason of or arising out of: (a) the Adviser being in material
violation of any applicable federal or state law, rule or regulation or any
investment policy or restriction set forth in the Funds' Registration Statement
or any written guidelines or instruction provided in writing by the Board,
provided that such violation was not cause by the Sub-Adviser, or (b) the
Adviser's willful misfeasance, bad faith, or gross negligence generally in the
performance of its duties hereunder or the Management Agreement or its reckless
disregard of its obligations and duties under this Agreement or the Management
Agreement; provided, however, that the Adviser Indemnitees shall not be
indemnified for any losses, claims, damages, liabilities or litigation sustained
as a result of the Sub-Adviser's, the Trust's, their officers', partners',
employees', consultants' or agents' willful misfeasance, bad faith, gross
negligence or reckless disregard of the duties under this Agreement or violation
of applicable law.
14. ENFORCEABILITY. Any term or provision of this Agreement which is
invalid or unenforceable in any jurisdiction shall, as to such jurisdiction be
ineffective to the extent of such invalidity or unenforceability without
rendering invalid or unenforceable the remaining terms or provisions of this
Agreement or affecting the validity or enforceability of any of the terms or
provisions of this Agreement in any other jurisdiction.
15. LIMITATION OF LIABILITY. The parties to this Agreement acknowledge and
agree that all litigation arising hereunder, whether direct or indirect, and of
any and every nature whatsoever shall be satisfied solely out of the assets of
the affected Funds and that no Trustee, officer or holder of shares of
beneficial interest of the Funds shall be personally liable for any of the
foregoing liabilities. The Trust's Certificate of Trust, as amended from time to
time, is on file in the Office of the Secretary of State of the Commonwealth of
Massachusetts. Such Certificate of Trust and the Trust's Agreement and
Declaration of Trust describe in detail the respective responsibilities and
limitations on liability of the Trustees, officers, and holders of shares of
beneficial interest.
16. CHANGE IN THE ADVISER'S OWNERSHIP. The Sub-Adviser agrees that it shall
notify the Trust of any anticipated or otherwise reasonably foreseeable change
in the ownership of the Sub-Adviser within a reasonable time prior to such
change being effected.
17. JURISDICTION. This Agreement shall be governed by and construed in
accordance with the substantive laws of the Commonwealth of Massachusetts and
the Sub-Adviser consents to the jurisdiction
A-10
of courts, both state and federal, in Massachusetts, with respect to any
dispute under this Agreement.
18. PARAGRAPH HEADINGS. The headings of paragraphs contained in this
Agreement are provided for convenience only, form no part of this Agreement and
shall not affect its construction.
19. COUNTERPARTS. This Agreement may be executed simultaneously in two or
more counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
20. CONFIDENTIALITY. The Sub-Adviser and the Adviser agree that they shall
exercise the same standard of care that they use to protect their own
confidential and proprietary information, but no less than reasonable care, to
protect the confidentiality of information supplied by either the Sub-Adviser or
the Adviser that is not otherwise in the public domain or previously known to
the other party in connection with the performance of its obligations and duties
hereunder, including Portfolio Information. As used herein "Portfolio
Information" means confidential and proprietary information of the Funds, the
Sub-Adviser or the Adviser that is received by the other party in connection
with this Agreement, including information with regard to the portfolio holdings
and characteristics of the portion of each of the Funds allocated to the
Sub-Adviser that the Sub-Adviser manages under the terms of this Agreement.
Other than as set forth in this Agreement or required by applicable law, the
Sub-Adviser and the Adviser will restrict access to the Portfolio Information to
those persons who will use it only for the purpose of managing the Funds or
servicing the Funds. The foregoing shall not prevent the Sub-Adviser from
disclosing Portfolio Information that is (1) publicly known or becomes publicly
known through no unauthorized act of its own, (2) rightfully received from a
third party without obligation of confidentiality, (3) approved in writing by
the Adviser for disclosure, or (4) required to be disclosed pursuant to a
requirement of a governmental agency or law so long as the Sub-Adviser provides
the Adviser with prompt written notice of such requirement prior to any such
disclosure. Nothing in this Agreement shall be construed to prevent the
Sub-Adviser from giving other entities investment advice about, or trading on
their behalf, in the portfolio securities of the Funds. The Adviser and its
employees or agents shall not use Portfolio Information, directly or indirectly,
for the purpose of purchasing or selling any securities for personal or other
accounts, and shall maintain policies and procedures reasonably designed to
prevent the use of the portfolio holdings information for such prohibited
securities trading purposes.
IN WITNESS WHEREOF, the parties hereto have caused this instrument to be
signed on their behalf by their duly authorized officers as of the date first
above written.
A-11
ATTEST: BISHOP STREET CAPITAL MANAGEMENT
_______________________ By:_____________________________
Name:
Title:
ATTEST: COLUMBIA MANAGEMENT INVESTMENT
ADVISERS, LLC
_______________________ By:_____________________________
Name:
Title:
Accepted and Agreed to as of the day and year first above written.
SIGNATURE PAGE -- SUB-ADVISORY AGREEMENT
SCHEDULE A
DATED _______, 20___
TO THE
AMENDED AND RESTATED SUB-ADVISORY AGREEMENT
BY AND BETWEEN
BISHOP STREET CAPITAL MANAGEMENT
AND
COLUMBIA MANAGEMENT INVESTMENT ADVISERS, LLC
The Adviser will pay to the Sub-Adviser as compensation for the Sub-Adviser's
services rendered, a fee, computed daily at an annual rate based on the average
daily net assets of each Fund under the following fee schedule:
FUND RATE
Bishop Street Dividend Value Fund 0.36% on the first $75 million;
0.35% on the next $75 million;
0.325% on the next $100 million;
0.30% on the next $250 million; and
0.25% on assets over $500 million
Bishop Street Strategic Growth Fund 0.36% on the first $75 million;
0.35% on the next $75 million;
0.325% on the next $100 million;
0.30% on the next $250 million; and
0.25% on assets over $500 million
SCHEDULE A -- SUB-ADVISORY AGREEMENT
<s>
BISHOP STREET FUNDS PROXY CARD
SIGN, DATE AND VOTE ON THE REVERSE SIDE
PROXY VOTING OPTIONS
YOUR VOTE IS IMPORTANT NO [GRAPHIC OMITTED] 1. MAIL your signed and voted proxy back in
MATTER HOW MANY SHARES the postage paid envelope provided
YOU OWN. PLEASE CAST YOUR
PROXT VOTE TODAY! [GRAPHIC OMITTED] 2. ONLINE at proxyonline.com using your
proxy control number found below
------------------------------------------- [GRAPHIC OMITTED] 3. By PHONE when you dial toll-free
SHAREHOLDER NAME 1-888-227-9349 to reach an automated
AND ADDRESS HERE touchtone voting line
-------------------------------------------
[GRAPHIC OMITTED] 4. By PHONE with a live operator when you
call toll-free 1-866-721-1447 Monday
through Friday 9 a.m. to 10 p.m. Eastern
time
CONTROL
NUMBER 12345678910
BISHOP STREET STRATEGIC GROWTH FUND
PROXY FOR A SPECIAL MEETING OF SHAREHOLDERS TO BE HELD ON OCTOBER 14, 2013
The undersigned Shareholder(s) of Bishop Street Strategic Growth Fund (the "Fund") a series of Bishop Street Funds (the "Trust"),
hereby appoint(s) Michael Beattie and Dianne Descoteaux and each of them (each with full power of substitution), the proxy or
proxies of the undersigned, to attend the Special Meeting of Shareholders of the Bishop Street Strategic Growth Fund, to be held on
October 14, 2013, at 2:00 p.m., Eastern time, at the offices of SEI Investments Global Funds Services, One Freedom Valley Drive,
Oaks, Pennsylvania 19456, and at any postponements or adjournments thereof ("Special Meeting"), to vote all of the shares of Bishop
Street Strategic Growth Fund that the undersigned would be entitled to vote if personally present at the Special Meeting and on any
other matters properly brought before the Special Meeting, all as set forth in the Proxy Statement for the Special Meeting of
Shareholders.
THIS PROXY IS SOLICITED ON BEHALF OF THE FUND'S BOARD OF TRUSTEES, AND THE PROPOSAL (SET FORTH ON THE REVERSE SIDE OF THIS PROXY
CARD) HAS BEEN UNANIMOUSLY APPROVED BY THE BOARD OF TRUSTEES AND RECOMMENDED FOR APPROVAL BY SHAREHOLDERS.
If you sign the proxy card without otherwise indicating a vote on the Proposal, the proxies will vote "FOR" the Proposal listed on
the reverse side. As to any other matter that may properly come before the Meeting, the shares will be voted by the proxies in
accordance with their judgment. The undersigned acknowledges receipt of the Notice of the Special Meeting and the Proxy Statement
for the Special Meeting.
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DO YOU HAVE QUESTIONS? If you have any questions about how to vote your proxy or about the meeting in general, please call toll-free
1-866-721-1447. REPRESENTATIVES ARE AVAILABLE TO ASSIST YOU Monday through Friday 9 a.m. to 10 p.m. Eastern Time.
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[PROXY ID NUMBER HERE] [BAR CODE HERE] [CUSIP HERE]
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BISHOP STREET STRATEGIC GROWTH FUND PROXY CARD
YOUR SIGNATURE IS REQUIRED FOR YOUR VOTE TO BE
COUNTED. Please sign this proxy exactly as your name appears on the ______________________________________________
books of the Fund. Joint owners should each sign personally. Trustees and SIGNATURE (AND TITLE IF APPLICABLE) DATE
other fiduciaries should indicate the capacity in which they sign, and
where more than one name appears, a majority must sign. If a
corporation, this signature should be that of an authorized officer who _______________________________________________
should state his or her title SIGNATURE (IF HELD JOINTLY) DATE
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TO VOTE, MARK BOX BELOW IN BLUE OR BLACK INK AS FOLLOWS. Example: []
THE BOARD OF TRUSTEES RECOMMENDS A VOTE FOR THE FOLLOWING:
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FOR AGIANST ABSTAIN
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1. TO APPOINT COLUMBIA MANAGEMENT INVESTMENT ADVISERS, LLC ("COLUMBIA")
AS A SUB-ADVISER OF THE BISHOP STREET STRATEGIC GROWTH FUND ("FUND")
AND TO APPROVE A SUB-ADVISORY AGREEMENT BETWEEN BISHOP STREET CAPITAL [ ] [ ] [ ]
MANAGEMENT AND COLUMBIA WITH RESPECT TO THE FUND.
THANK YOU FOR VOTING
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[PROXY ID NUMBER HERE] [BAR CODE HERE] [CUSIP HERE]
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