UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a) of the Securities Act of 1934
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[X] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only
(as permitted by Rule 14a-6(e)(2))
[ ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Rule 14a-12
DOMINI SOCIAL INVESTMENT TRUST
(Name of Registrant as Specified In Its Charter)
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
1) Title of each class of securities to which transaction applies:
2) Aggregate number of securities to which transaction applies:
3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):
4) Proposed maximum aggregate value of transaction:
5) Total fee paid:
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
2) Form, Schedule or Registration Statement No.:
3) Filing Party:
4) Date Filed:
Domini Social Bond Fund
536 Broadway, 7th Floor
New York, New York 10012
May 23, 2005
Dear Fellow Shareholder:
I am writing today to request your approval of a new submanager for the Domini
Social Bond Fund.
Enclosed is a proxy statement describing the proposal, which will be considered
at a Special Meeting of Shareholders of the Fund to be held on June 28, 2005, at
10:00 am, Eastern Time, at the offices of Bingham McCutchen LLP, 150 Federal
Street, 16th Floor, Boston, Massachusetts. You are receiving this proxy
statement because you were a shareholder of the Domini Social Bond Fund on May
10, 2005, and are entitled to vote.
I certainly understand your temptation to set this proxy aside for another day,
or to simply ignore it altogether. I strongly encourage you to resist this
temptation and cast your vote today. If you vote promptly, you will save the
Fund the additional costs required for follow-up mailings and telephone calls.
Your vote is important, and voting only takes a few minutes.
You are not required to attend the Special Meeting in order to cast your vote.
Please take a few moments to read the enclosed materials and then cast your vote
by simply filling out the enclosed card, or by using the telephone or Internet
voting instructions printed on your proxy card. As a shareholder, you cast one
vote for each dollar of net asset value represented by your shares in the Fund.
If the Fund does not receive your proxy card, our proxy solicitor, DF King, may
contact you to help you cast your vote.
Approval of a new submanager for the Domini Social Bond Fund will not change the
Fund's investment strategies or investment objective. The Fund's Board of
Trustees has carefully reviewed the proposal and has determined that it is fair
and reasonable and in shareholders' best interests. The Fund's Board of Trustees
is composed of eight individuals, seven of whom are unaffiliated with Domini
Social Investments LLC, the manager and administrator of the Fund. The Board's
job is to protect your interests as shareholders. The Board recommends that you
vote "For" the proposal.
We have made an effort to write as much of this material in plain English as
possible. Although we encourage you to read through this proxy statement
carefully, we have also prepared a brief overview section in order to help make
your decision easier. We hope that you find it helpful.
Your vote is important. Please take a moment now to vote by completing your
proxy
card, or by using the telephone or Internet voting instructions printed on your
proxy card. If you choose to vote by mail, please be sure to sign your proxy
card and return it in the enclosed postage-paid envelope. If you have any
questions regarding the issues to be voted on, or need assistance in completing
your proxy card, please call the telephone number provided on your proxy card.
For additional information on the voting process, see Part 2 of the proxy
statement.
Thank you in advance for your participation in this important process.
Sincerely yours,
/s/ Amy L. Domini
Amy L. Domini
Chair and President
Domini Social Investment Trust
TABLE OF CONTENTS
Page
Overview of Proxy Statement .............................................. 1
Notice of Special Meeting ................................................ 3
Proxy Statement .......................................................... 4
Part 1. Overview ............................................... 4
Part 2. Information Regarding Voting and the Special Meeting ... 5
Part 3. The Proposals .......................................... 7
Part 4. Information Regarding the Fund ......................... 14
Exhibits
Exhibit A -- Submanagement Agreement with Seix Advisors,
the fixed-income division of
Trusco Capital Management, Inc. ................... A-1
Exhibit B -- Information Regarding Mutual Funds
Managed by Seix Advisors,
the Fixed-Income Division of
Trusco Capital Management, Inc. ................... B-1
This page intentionally left blank
OVERVIEW OF PROXY STATEMENT
A Special Meeting of Shareholders of the Domini Social Bond Fund (the
"Fund") will be held at Bingham McCutchen LLP, 150 Federal Street, 16th Floor,
Boston, Massachusetts, on June 28, 2005, at 10:00 am, Eastern Time, for the
purposes described in this proxy statement.
We encourage you to read this proxy statement carefully before casting your
vote. We have prepared the following questions and answers in order to help make
your decision easier. If you have any further questions, please feel free to
call us at 1-888-414-5566.
Q. What is the role of the Board of Trustees?
A. The Board of Trustees has the important responsibility of protecting your
interests as shareholders. It oversees the operations of the Fund, and
makes sure that all decisions are fair and in your best interests. The
Fund's Board of Trustees is made up of eight individuals, seven of whom are
"independent" meaning that they have no formal affiliation with Domini
Social Investments LLC ("Domini") (the manager of the Fund) or the Fund
except in the role they play as Trustees. In addition, the Trustees are
represented by independent legal counsel to further ensure that shareholder
interests remain paramount.
Q. Why are shareholders of the Fund being asked to approve the submanagement
agreement with Seix Advisors?
A. On March 1, 2005, Domini replaced ShoreBank with Seix Advisors, the
fixed-income division of Trusco Capital Management, Inc., as the submanager
of the Domini Social Bond Fund. Shareholders of the Fund are being asked to
approve the submanagement agreement with Seix Advisors in accordance with
applicable law.
Trusco Capital Management is a wholly owned subsidiary of SunTrust Banks,
Inc. As of March 31, 2005, Trusco Capital Management managed more than
$69.6 billion in assets.
The Board of Trustees carefully reviewed Seix Advisors' capabilities and
track record and unanimously approved its selection. We believe that Seix
Advisors will be able to provide the Fund with strong, long-term service.
Q. How does the Board of Trustees recommend that I vote?
A. The Board of Trustees has carefully reviewed the proposal to approve a new
submanagement agreement with Seix Advisors and unanimously recommends that
you vote FOR the proposal on the enclosed proxy card. A discussion of the
factors that the Trustees considered before granting their approval is
included in Part 3 of this proxy statement.
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Q. If the proposal to approve the submanagement agreement with Seix Advisors
is approved, will there be any change in the investment strategies used by
the Fund?
A. No. There is no current intention to change any of the investment
strategies or the investment objectives of the Fund, including the Fund's
commitment to principles of socially responsible investing. We are asking
you to approve the proposal described in this proxy statement because we
believe, and the Board of Trustees believes, that it is in your best
interests.
Q. If the proposal to approve the submanagement agreement with Seix Advisors
is approved, will this affect the expenses that Fund shareholders must pay?
A. No. Approval of the submanagement agreement will have no effect upon the
amount of advisory fees paid by the Fund to Domini. The expense of Seix
Advisors' submanagement fees is borne by Domini, not by the Fund or its
shareholders.
Q. What role will Seix Advisors play in managing the Fund?
A. As submanager for the Domini Social Bond Fund, Seix Advisors will be
responsible for the day-to-day management of the Fund. In addition, Seix
Advisors will provide Domini with various reports that Domini requires to
supervise the management of the Fund.
Q. Why did Domini decide to terminate the Fund's submanagement agreement with
ShoreBank?
A. Domini has enjoyed a long and collegial relationship with ShoreBank, one of
the nation's premier community development financial institutions. Domini
continues to offer the Domini Money Market Account, a pass-through account
to ShoreBank that allows our investors to use their cash to support the
bank's community development work. When Domini launched the Domini Social
Bond Fund, the Fund was the first mutual fund to be submanaged by a
community development financial institution. Domini and ShoreBank are proud
of that achievement, and of our work together to build the Fund to where it
is today. However, the Fund was ShoreBank's only mutual fund client, and as
assets grew we came to the mutual recognition that the Fund's shareholders
would be best served by an investment adviser managing other mutual funds,
such as Seix Advisors.
Q. How do I vote?
A. You can vote by mail, by telephone, or on the Internet. Please see the
instructions set forth on the top portion of the enclosed proxy card. You
can also vote in person, by attending the Special Meeting of Shareholders.
The meeting will be held at Bingham McCutchen LLP, 150 Federal Street, 16th
Floor, Boston, Massachusetts, on June 28, 2005, at 10:00 am, Eastern Time.
You do not need to attend in person in order to cast your vote.
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DOMINI SOCIAL BOND FUND
536 Broadway, 7th Floor
New York, New York 10012
Telephone: (800) 582-6757
www.domini.com
NOTICE OF SPECIAL MEETING
OF SHAREHOLDERS
To be held Tuesday, June 28, 2005
A Special Meeting of Shareholders of the Domini Social Bond Fund (the
"Fund") will be held at Bingham McCutchen LLP, 150 Federal Street, 16th Floor,
Boston Massachusetts, on Tuesday, June 28, 2005, at 10:00 am, Eastern Time, for
the purposes listed below.
Please review the proposals listed below carefully and be sure to vote on each
proposal on which you are asked to vote.
Proposal 1. To approve a Submanagement Agreement for the Fund between
Seix Advisors, the fixed-income division of Trusco Capital
Management, Inc., and Domini Social Investments LLC.
Proposal 2. To transact such other business as may properly come before
the Special Meeting of Shareholders and any adjournments of
the Special Meeting.
The Board of Trustees of the Fund recommends that you vote in favor of
Proposal 1.
Only shareholders of record on May 10, 2005, will be entitled to vote at
the Special Meeting of Shareholders and at any adjournments thereof.
Carole M. Laible, Treasurer
May 23, 2005
YOUR VOTE IS IMPORTANT. If you promptly vote, sign, and return the enclosed
proxy, you will help avoid the additional expense of a second solicitation. The
enclosed addressed envelope requires no postage and is provided for your
convenience.
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DOMINI SOCIAL BOND FUND
536 Broadway, 7th Floor
New York, New York 10012
Telephone: (800) 582-6757
www.domini.com
PROXY STATEMENT
This Proxy Statement is being furnished to you in connection with the
solicitation of proxies by the Board of Trustees of the Domini Social Bond Fund
(the "Fund") for use at a Special Meeting of Shareholders of the Fund, or any
adjournment thereof, to be held at Bingham McCutchen LLP, 150 Federal Street,
16th Floor, Boston, Massachusetts 02110, on Tuesday, June 28, 2005, at 10:00 am,
Eastern Time, for the purposes set forth in the accompanying Notice of Special
Meeting.
This Proxy Statement is divided into the following four parts:
Part 1. Overview. Pages 4-5
Part 2. Information Regarding Voting and
the Special Meeting. Pages 5-7
Part 3. The Proposals. Pages 7-14
Part 4. Information Regarding the Fund. Pages 14-15
This Proxy Statement and proxy card were first mailed to shareholders on or
about May 23, 2005.
PART 1. OVERVIEW.
The Board of Trustees of the Domini Social Bond Fund has called a Special
Meeting of Shareholders for the purposes described in the accompanying Notice of
Special Meeting and as summarized below. The purpose of this Proxy Statement is
to provide you with additional information regarding the proposal to approve the
submanagement agreement with Seix Advisors to be voted on at the meeting and to
request your vote in favor of the proposal.
The Fund is an open-end investment company, or mutual fund. The Fund seeks
a high level of current income and total return by investing in bonds and other
debt instruments that pass multiple, broad-based social and environmental
screens.
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The Fund currently employs Domini Social Investments LLC ("Domini") as its
investment manager. Prior to March 1, 2005, Domini employed ShoreBank as an
investment submanager to manage the investments of the Fund on a day-to-day
basis.
At the regular meeting of the Board of Trustees held on January 28, 2005,
the Board of Trustees voted to terminate the submanagement agreement between
Domini and ShoreBank as of February 28, 2005, and authorized Domini to enter
into a submanagement agreement with Seix Advisors, the fixed-income division of
Trusco Capital Management, Inc. The submanagement agreement with Seix Advisors
went into effect on March 1, 2005. In accordance with the requirements of the
Investment Company Act of 1940, as amended (the "1940 Act"), the submanagement
agreement with Seix Advisors must be approved by shareholders of the Fund. This
proposal is discussed in more detail beginning on page ___.
PART 2. INFORMATION REGARDING VOTING AND THE SPECIAL MEETING.
Voting Process
You can vote in any one of the following ways:
o By mail, by filling out and returning the enclosed proxy card
o By telephone, by dialing toll-free 1-800-690-6903
o On the Internet, by visiting the website printed on your proxy card
o In person at the meeting
Whichever method you choose to vote, please carefully read this Proxy Statement,
which describes in detail the proposals upon which you are asked to vote.
If you return your proxy and fail to provide instructions as to how to vote
your shares with respect to any proposal, your shares will be voted FOR that
proposal.
Record Date
The close of business on May 10, 2005, has been fixed as the Record Date
for the determination of shareholders entitled to notice of and to vote at the
meeting. ________ Investor shares of the Fund ($0.00001 par value) were
outstanding as of the close of business on the Record Date. There were no Class
R shares of the Fund outstanding as of the close of business on the Record Date.
As a shareholder of record at the close of business on the Record Date, you will
be entitled to one vote for each dollar of net asset value represented by the
shares you own in the Fund.
Quorum
Holders of a majority of the shares of the Fund outstanding on the Record
Date constitute a quorum and must be present in person or represented by proxy
at the meeting for purposes of voting on the proposal to approve the
submanagement
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agreement with Seix Advisors. Your shares will be represented by proxy at the
meeting if you vote by mail, by telephone, or on the Internet.
Regardless of how you vote ("For," "Against," or "Abstain"), your shares
will be counted for purposes of determining the presence of a quorum. In
addition, broker "non-votes" (that is shares held by brokers or nominees as to
which (a) instructions have not been received from the beneficial owner or other
persons entitled to vote and (b) the broker or nominee does not have
discretionary power to vote on a particular matter) will be counted for purposes
of determining the presence of a quorum.
If you mark "Abstain" on your proxy card with respect to any proposal on
which you are entitled to vote, your vote will have the effect of a "no" vote
for purposes of obtaining the requisite approval of Proposal 1. Broker
"non-votes" will also have the effect of a "no" vote for purposes of obtaining
the requisite approval of Proposals 1 and 2.
Revoking Your Proxy
You may revoke your proxy at any time prior to the meeting (or any
adjournment thereof) by putting your revocation in writing, signing it, and
either delivering it to the meeting or sending it to Carole M. Laible, Treasurer
of the Domini Funds, 536 Broadway, 7th Floor, New York, New York 10012. You may
also revoke your proxy by voting in person at the meeting.
Adjournments
If sufficient votes in favor of any proposal are not received, the persons
named as proxies may propose one or more adjournments of the meeting to permit
further solicitation of proxies with respect to that proposal. An adjournment of
the meeting will suspend the meeting to another time. Any such adjournment will
require the affirmative vote of a majority of those shares voted at the meeting.
If you voted in favor of a proposal or failed to provide instructions as to how
to vote your shares with respect to a proposal, the persons named as proxies
will vote your shares in favor of the adjournment of the meeting with respect to
that proposal. If you voted against or abstained from voting on a proposal, the
persons named as proxies will vote your shares against any such adjournment. Any
proposals for which sufficient favorable votes have been received by the time of
the meeting may be acted upon and considered final regardless of whether the
meeting is adjourned to permit the additional solicitation of proxies with
respect to any other proposals.
Proxy Solicitation Costs
The cost of soliciting proxies, including the fees of a proxy soliciting
agent (which are expected to be approximately $_________), will be borne by the
Fund. In addition to solicitation by mail, proxies may be solicited by the Board
of Trustees, officers, and regular employees and agents of the Fund without
compensation. The Fund may reimburse brokerage firms and others for their
expenses in forwarding proxy materials to the beneficial owners and soliciting
them to execute the proxies. By
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voting as soon as you receive your proxy materials, you will help reduce the
cost of additional solicitations.
PART 3. THE PROPOSALS.
Proposal 1. To vote on a Submanagement Agreement for the Domini Social
Bond Fund between Seix Advisors, the fixed-income division
of Trusco Capital Management, Inc., and Domini Social
Investments LLC.
Background
Domini Social Investments LLC, a Massachusetts limited liability company
("Domini"), 536 Broadway, 7th Floor, New York, New York 10012, manages the
assets of the Domini Social Bond Fund (the "Fund") pursuant to a Management
Agreement dated as of May 1, 2000 (the "Management Agreement").
The Management Agreement was most recently approved by the Board of
Trustees of the Fund on April 29, 2005. The Management Agreement was most
recently submitted to a vote of shareholders in the Fund on May 31, 2000, in
connection with its initial approval.
Subject to the terms of the Management Agreement, Domini is responsible for
the management of the Fund. As part of its responsibilities as portfolio
manager, Domini selects and employs, subject to the review and approval of the
Board of Trustees of the Fund, one or more submanagers to invest the Fund's
assets consistent with the Fund's investment objective and the guidelines and
directions set by Domini and the Board of Trustees, and reviews the submanager's
continued performance. Domini's selection of a submanager is subject to the
review and approval of the Board of Trustees of Fund and the Fund's
shareholders. Domini may terminate the services of a submanager at any time.
Prior to March 1, 2005, ShoreBank served as the submanager of the Fund
pursuant to a Submanagement Agreement, dated as of May 1, 2000, between
ShoreBank and Domini (the "ShoreBank Submanagement Agreement"). ShoreBank is an
Illinois banking corporation, and its principal executive office is at 7054 S.
Jeffery Boulevard, Chicago, Illinois 60649. As submanager, ShoreBank was
responsible for the day-to-day management of the Fund and for investing the
Fund's assets in a manner consistent with the terms of the ShoreBank
Submanagement Agreement and the investment objectives of the Fund. The ShoreBank
Submanagement Agreement was most recently approved by the Board of Trustees of
the Fund on April 30, 2004. The ShoreBank Submanagement Agreement was most
recently submitted to a vote of shareholders in the Fund on May 31, 2000, in
connection with its initial approval.
At a regular meeting of the Board of Trustees of the Fund held on January
28, 2005, the Board considered the termination of ShoreBank as the submanager of
the Fund. The Board reviewed the services provided by ShoreBank as submanager
and considered Domini's long and collegial relationship with ShoreBank. However,
the Fund was ShoreBank's only mutual fund client and as assets grew, Domini and
ShoreBank came to the mutual recognition that the Fund's shareholders would be
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best served by an investment adviser managing other mutual funds. The Board also
considered Domini's recommendation that Seix Advisors, the fixed-income division
of Trusco Capital Management, Inc. ("Seix Advisors"), be appointed as the
submanager of the Fund. As discussed below under the heading "Evaluation by the
Board of Trustees," Domini, at the direction of the Board, terminated the
ShoreBank Submanagement Agreement and entered into a submanagement agreement
with Seix Advisors. Accordingly, effective at the close of business on February
28, 2005, the ShoreBank Submanagement Agreement was terminated. The
Submanagement Agreement with Seix Advisors (the "Seix Advisors Submanagement
Agreement") became effective on March 1, 2005.
The Submanagement Agreements
The terms of the Seix Advisors Submanagement Agreement (other than the
investment advisory fees to be paid by Domini to Seix Advisors) are
substantially similar to those of the ShoreBank Submanagement Agreement. A
description of the investment advisory fees to be paid by Domini to Seix
Advisors is set forth below under the heading "Investment Advisory Fees."
Term of Seix Advisors Submanagement Agreement
The Seix Advisors Submanagement Agreement became effective on March 1,
2005. If approved by the vote of the holders of a "majority of the outstanding
voting securities" (as defined under the heading "Vote Required" below) of the
Fund, the Seix Advisors Submanagement Agreement will continue in effect until
March 1, 2007, and thereafter from year to year, subject to approval annually by
the Board of Trustees of the Fund or the shareholders of the Fund in accordance
with the 1940 Act. The Seix Advisors Submanagement Agreement may be terminated
at any time without the payment of any penalty by the Board of Trustees of the
Fund, by the vote of a "majority of the outstanding voting securities" of the
Fund, or by Domini. The Seix Advisors Submanagement Agreement may also be
terminated by Seix Advisors on 90 days' advance written notice to Domini. The
Seix Advisors Submanagement Agreement will also terminate automatically in the
event of its "assignment" (as defined in the 1940 Act).
Comparison of Submanagement Agreements
Under the Seix Advisors Submanagement Agreement, as under the ShoreBank
Submanagement Agreement, the submanager will be responsible for the day-to-day
management of the Fund, subject always to the provisions of the 1940 Act and to
the investment objectives, policies, procedures, and restrictions imposed by the
Fund's then current Registration Statement under the 1940 Act and the Fund's
Declaration of Trust and By-Laws. Like the ShoreBank Submanagement Agreement,
the Seix Advisors Submanagement Agreement provides that Domini or the Trustees
of the Fund may, at any time, suspend or restrict the right of the submanager to
determine what securities will be purchased or sold on behalf of the Fund and
what portion, if any, of the assets of the Fund allocated by Domini to the
submanager will be held uninvested. Seix Advisors will also provide Domini with
such investment advice and reports and data as are requested by Domini.
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Like the ShoreBank Submanagement Agreement, the Seix Advisors Submanagement
Agreement provides that the submanager will not be liable for any error of
judgment or mistake of law, for any loss arising out of any investment, or for
any act or omission in the execution of securities transactions for the Fund,
except for willful misfeasance, bad faith, or gross negligence in the
performance of its duties, or by reason of reckless disregard of its obligations
under the Seix Advisors Submanagement Agreement.
You should refer to Exhibit A attached to this Proxy Statement for the
complete Seix Advisors Submanagement Agreement. The description of the Seix
Advisors Submanagement Agreement in this Proxy Statement is qualified in its
entirety by the provisions of the Seix Advisors Submanagement Agreement in
Exhibit A.
Investment Advisory Fees
Under the ShoreBank Submanagement Agreement, Domini (not the Fund) paid
ShoreBank for its services a fee computed and paid monthly at an annual rate
equal to 0.20% of the Fund's average daily net assets.
Seix Advisors' management fees are also paid by Domini, not the Fund. From
March 1, 2005, to but not including July 29, 2005, or if earlier, the date on
which the Seix Advisors Submanagement Agreement is approved by the shareholders
of the Fund (such period to be called the "Interim Period"), Domini will pay to
Seix Advisors a submanagement fee, accrued daily and paid monthly at an annual
rate equal to 0.20% of the average daily net assets of the Fund allocated to
Seix Advisors.
If the shareholders of the Fund approve the Seix Advisors Submanagement
Agreement, Domini will pay to Seix Advisors an annual submanagement fee based on
the following schedule (the "Approved Fee Schedule"):
0.40% on the first $10 million of net assets managed
0.35% on the next $10 million of net assets managed
0.30% on the next $30 million of net assets managed
0.25% on the next $30 million of net assets managed
0.20% on the next $120 million of net assets managed
0.15% on the next $300 million of net assets managed
0.10% on the next $500 million of net assets managed
0.05% over $1 billion of net assets managed
In addition, if the shareholders of the Fund approve the Seix Advisors
Submanagement Agreement, Domini will pay to Seix Advisors an amount equal to the
difference between (a) the submanagement fees paid during the Interim Period
prior to shareholder approval and (b) the submanagement fees that would have
been payable during the Interim Period under the Approved Fee Schedule.
Notwithstanding the above fees, the subadvisory fees payable by Domini will not
exceed $180,000 for the period from March 1, 2005, through March 1, 2006.
Approval of the Seix Advisors Submanagement Agreement will have no effect
upon the amount of advisory fees paid by the Fund to Domini. Domini, not the
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Fund, will pay investment management fees to Seix Advisors as the submanager to
the Fund. Until November 30, 2005, Domini has contractually agreed to waive fees
and/or reimburse expenses, including its management fee, so that the Fund's
expenses, net of waivers and reimbursements, will not exceed, on a per annum
basis, 0.95% of the average daily net assets representing Investor shares,
absent an earlier modification by the Board of Trustees, which oversees the
Fund. The approval of the Seix Advisors Submanagement Agreement will have no
effect on this contractual fee waiver or the total annual operating expenses of
the Fund.
Fees payable to ShoreBank for services provided under the ShoreBank
Submanagement Agreement for the Fund's 2004 fiscal year (August 1, 2003, to July
31, 2004) were $107,059. Neither ShoreBank nor any affiliated person of
ShoreBank, nor any affiliated person of any such affiliated person, received any
other fees from Domini or from the Fund for services provided to the Fund during
the Fund's 2004 fiscal year. There were no other material payments by Domini or
the Fund to ShoreBank, any affiliated person of ShoreBank, or any affiliated
person of any such affiliated person, during the Fund's 2004 fiscal year.
If the Seix Advisors Submanagement Agreement had been in effect during the
Fund's 2004 fiscal year, the fees that would have been payable by Domini to Seix
Advisors for services provided pursuant to the Seix Advisors Submanagement
Agreement, based on the Approved Fee Schedule, would have been $173,824. The
aggregate of these fees represents a 62.4% increase from the amount of fees that
Domini paid to ShoreBank for that period under the ShoreBank Submanagement
Agreement. This increase in fees is borne by Domini, not by the Fund or its
shareholders.
For the Fund's 2004 fiscal year, no commissions were paid to any broker (a)
that is an affiliated person of the Fund, (b) that is an affiliated person of
any affiliated person of the Fund, or (c) an affiliated person of which is an
affiliated person of the Fund, Domini, ShoreBank, Seix Advisors, or the
distributor of the Fund.
Information Regarding Seix Advisors
Seix Advisors is the fixed-income division of Trusco Capital Management,
Inc. ("Trusco"). Trusco is a wholly owned subsidiary of SunTrust Banks, Inc.
("SunTrust"). Seix Advisors is located at 10 Mountainview Road, Suite C-200,
Upper Saddle River, New Jersey 07458. Seix Advisors has been in the business of
providing investment advisory services since 1992 and was acquired by Trusco in
2004. As of March 31, 2005, Trusco had more than $69.6 billion in assets under
management.
Management and Governance. Listed below are the names, positions, and
principal occupations of the members of the Board of Directors and the principal
executive officers of Trusco as of March 31, 2005. The principal business
address of Christina Seix and John Talty, each an Executive Vice President of
Trusco, is at the offices of Seix Advisors, 10 Mountainview Road, Suite C-200,
Upper Saddle River, New Jersey 07458. The address of each of the other Directors
and principal executive officers of Trusco is 50 Hurt Plaza, Suite 1400,
Atlanta, Georgia 30303.
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Position with Trusco Capital
Name Management, Inc. Other Principal Occupation
David Eidson Chairman President, Institutional Investment
Management, SunTrust
Paul Robertson Secretary, Executive Vice President N/A
William H. Rogers, Jr. Director Executive Vice President, SunTrust Wealth
and Investment Management, SunTrust
Doug Phillips President, Chief Executive Officer, and N/A
Chief Investment Officer
John Stebbins Chief Financial Officer N/A
Patrick Paparelli Managing Director of Human N/A
Resources/Compliance/
Legal
Deborah Lamb Chief Compliance Officer Chief Compliance Officer, STI Classic Funds
Christina Seix Executive Vice President Chief Executive Officer and Chief
Investment Officer of Seix Advisors
John Talty Executive Vice President President of Seix Advisors
No officer or Trustee of the Fund currently is an officer or employee of
Seix Advisors, Trusco, or SunTrust, or a member of either Trusco's or SunTrust's
Board of Directors. No officer or Trustee of the Fund has any other material
direct or indirect interest in the proposal to approve the Seix Advisors
Submanagement Agreement or in
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Seix Advisors, Trusco, or SunTrust, or any other person controlling, controlled
by, or under common control with Seix Advisors, Trusco, or SunTrust. Since
August 1, 2003, none of the officers or Trustees of the Fund has had any
material interest, direct or indirect, in any material transactions, or in any
material proposed transactions, to which Seix Advisors, Trusco, or SunTrust was
or is to be a party.
Seix Advisors, the fixed-income division of Trusco, acts as the investment
adviser for those investment-grade fixed-income mutual funds listed on Exhibit B
attached hereto. Information concerning the net assets of those mutual funds and
the fees paid to Seix Advisors for its services to those investment-grade
fixed-income mutual funds is also provided on Exhibit B.
The Evaluation by the Board of Trustees
The Board of Trustees of the Fund terminated the ShoreBank Submanagement
Agreement and approved the Seix Advisors Submanagement Agreement at a meeting
held on January 28, 2005.
Before terminating the ShoreBank Submanagement Agreement, the Board of
Trustees of the Fund reviewed with Domini its recommendation that ShoreBank be
terminated as the submanager of the Fund. Domini reviewed ShoreBank's fees in
comparison to the fee rates proposed by Seix Advisors. Domini also reviewed the
services that ShoreBank provided to the Fund in comparison to the services
proposed to be provided by Seix Advisors. The Board considered Domini's long and
collegial relationship with ShoreBank. However, the Fund was ShoreBank's only
mutual fund client, and as assets grew, Domini and ShoreBank came to the mutual
recognition that the Fund's shareholders would be best served by an investment
adviser managing other mutual funds.
The Board of Trustees then reviewed Domini's procedure for selecting a new
submanager for the Fund. The Board of Trustees noted that Domini had conducted
an extensive due diligence process with respect to seven candidates for the
submanager position. This due diligence process involved a review of extensive
questionnaires completed by submanager candidates, a review of publicly
available filings and disciplinary records of each candidate, and in-person
meetings to evaluate the quality of services and capability of each candidate.
This due diligence process resulted in Domini's recommendation of Seix Advisors
as submanager to the Domini Social Bond Fund. The Board of Trustees concluded
that Domini had reviewed a sufficient pool of potential submanager candidates
and had conducted an adequate due diligence process.
The Board of Trustees then met with a representative of Seix Advisors. The
Trustees considered information with respect to Seix Advisors and whether the
Seix Advisors Submanagement Agreement was in the best interests of the Fund and
its shareholders. The Trustees considered the nature and quality of services
expected to be provided by Seix Advisors. They noted that Seix Advisors had over
$23 billion in fixed-income assets under management and reviewed a list of
representative clients. The Trustees also reviewed and discussed information
regarding Seix Advisors' knowledge and experience in managing fixed-income
portfolios. The Trustees noted that the senior portfolio manager who would be
responsible for the management of the
-13-
Fund had over 23 years of experience in the investment management field, and
that there was an experienced team of investment management professionals
supporting the senior portfolio manager. The Trustees noted that there had been
nearly no portfolio manager turnover at Seix Advisors since the inception of the
firm. In evaluating Seix Advisors' ability to provide services to the Fund, the
Trustees considered additional information as to Seix Advisors' business
organization, financial resources, personnel, technology systems, and other
matters. The Trustees concluded that Seix Advisors had the capability to provide
solid and consistent investment management services with an experienced and
dedicated team of management professionals.
The Trustees also reviewed the investment performance of Seix Advisors'
investment-grade fixed-income composite and compared this investment performance
with that of the Fund's benchmark index. The Trustees concluded that this
investment performance was consistent and reasonable in relationship to the
Fund's benchmark index. The Trustees also considered Seix Advisors' trading
capabilities and reviewed its systems for executing the Fund's trades with
broker-dealers.
The Trustees also reviewed the investment management fees proposed by Seix
Advisors. The Trustees compared the investment management fees proposed by Seix
Advisors with those proposed by other investment managers and concluded that the
fees were reasonable in relationship to the other proposals received. The
Trustees noted that because as manager, Domini pays the submanager, Domini would
bear the higher investment management fees charged by Seix Advisors.
The Trustees reviewed the compliance policies and procedures of Seix
Advisors as well as biographical information about the Chief Compliance Officer
of Trusco and supporting compliance department personnel. They noted that Seix
Advisors had a clean disciplinary record and had systems in place in order to
identify potential compliance issues. In particular, they noted that Seix
Advisors had an automated guideline compliance system in place that would assist
in preventing violations of the Fund's investment objectives and policies.
In addition, the Trustees reviewed Seix Advisors' social profile, including
its experience with managing socially screened accounts, the diversity of its
management team and employees, and its commitment to community development. The
Trustees noted that Seix Advisors managed approximately $5 billion in assets for
clients with a variety of social standards. The Trustees considered that Seix
Advisors was founded by a Hispanic female, Christina Seix, and that the firm
demonstrated a commitment to diversity in its workforce. The Trustees also
reviewed SunTrust's activities in community-focused lending.
Based upon its review, the Board of Trustees concluded the following:
o Seix Advisors had demonstrated the ability to manage socially screened
accounts, trade efficiently, and provide the information and analyses
needed by Domini.
o The terms of the Seix Advisors Submanagement Agreement were
reasonable, fair, and in the best interests of the Fund and its
shareholders.
-14-
o The fees provided in the Seix Advisors Submanagement Agreement were
fair and reasonable in light of the usual and customary charges made
for services of the same nature and quality.
Accordingly, after consideration of the above factors, and such other
factors and information as it deemed relevant, the Board of Trustees terminated
the ShoreBank Submanagement Agreement and approved the Seix Advisors
Submanagement Agreement. The Seix Advisors Submanagement Agreement went into
effect on March 1, 2005.
Vote Required
Approval of the Seix Advisors Submanagement Agreement will require the
approval of "a majority of the outstanding voting securities" (as defined in the
1940 Act) of the Fund, which means the affirmative vote by the lesser of (a) 67%
or more of the shares of the Fund present at the meeting, if more than 50% of
the outstanding shares of the Fund are represented at that meeting in person or
by proxy or (b) more than 50% of the outstanding shares of the Fund.
In the event that the Seix Advisors Submanagement Agreement does not
receive the requisite approval, Domini will negotiate a new investment
submanagement agreement with a different investment advisory organization or
make other appropriate arrangements, in either event subject to approval in
accordance with the 1940 Act.
The Board of Trustees unanimously recommends that you vote FOR the approval
of the Seix Advisors Submanagement Agreement.
--------------------------------------------------------------------------------
Proposal 2. To transact such other business as may properly come before
the Special Meeting of Shareholders and any adjournments of
the Special Meeting.
The management of the Fund knows of no other business to be presented at
the meeting. If any additional matters should be properly presented, it is
intended that the enclosed proxy (if not limited to the contrary) will be voted
in accordance with the judgment of the persons named in the enclosed form of
proxy.
PART 4. INFORMATION REGARDING THE FUND.
Annual Report
Each of the Fund's Annual Report for the fiscal year ended July 31, 2004,
including audited financial statements, and the Fund's Semi-Annual Report for
the period ended January 31, 2005 has previously been sent to shareholders. Both
reports are available without charge by written request to Domini Social
Investments, P.O. Box 9785, Providence, RI 02940-9785, by calling Domini at
1-800-582-6757, or by downloading the reports from our website at
www.domini.com.
-15-
Additional Information
The Fund is a series of Domini Social Investment Trust (the "Trust"), a
diversified, open-end registered investment company organized as a Massachusetts
business trust under a Second Amended and Restated Declaration of Trust dated as
of May 15, 2001. The Fund was designated as a separate series of the Trust on
January 20, 2000. The mailing address of the Trust is 536 Broadway, 7th Floor,
New York, New York 10012.
The Fund's distributor is DSIL Investment Services LLC, 536 Broadway, 7th
Floor, New York, New York 10012. PFPC Inc. acts as transfer agent and dividend
disbursing agent for the Fund. The principal business address of PFPC Inc. is
4400 Computer Drive, Westborough, Massachusetts 01581. Investors Bank & Trust
Company ("IBT") acts as the custodian for the Fund. IBT's principal business
address is 200 Clarendon Street, Boston, Massachusetts 02116.
To keep the Fund's costs as low as possible, and to conserve paper usage,
we attempt to eliminate duplicate mailings to the same address where practical.
When two or more Fund shareholders have the same last name and address, only one
proxy statement is being sent to that address unless the Fund has received
contrary instructions from one or more of those shareholders. If your household
is receiving separate mailings that you feel are unnecessary, or if you want us
to send separate mailings in the future, please send a written request to the
Trust at the mailing address provided above or call Domini at 1-800-582-6757. If
you want to receive a separate copy of this proxy statement, one will be
delivered to you promptly upon such written or oral request.
Submission of Certain Proposals
The Trust is a Massachusetts business trust and as such is not required to
hold annual meetings of shareholders, although special meetings may be called
for the Fund, for purposes such as electing Trustees or removing Trustees,
changing fundamental policies, or approving an advisory contract. Shareholder
proposals to be presented at any subsequent meeting of shareholders must be
received by the Trust at the Trust's office within a reasonable time before the
proxy solicitation is made.
By Order of the Board of Trustees,
Carole M. Laible, Treasurer
May 23, 2005
Exhibit A
SUBMANAGEMENT AGREEMENT
SUBMANAGEMENT AGREEMENT, dated as of March 1, 2005, by and between Domini
Social Investments LLC, a Massachusetts limited liability company ("DSIL" or the
"Manager"), and Seix Advisors, a division of Trusco Capital Management, Inc., a
Georgia corporation (the "Submanager").
W I T N E S S E T H:
WHEREAS, Domini Social Investment Trust (the "Trust") engages in business
as an open-end management investment company and is registered as such under the
Investment Company Act of 1940, as amended (collectively with the rules and
regulations promulgated thereunder, in each case as in effect from time to time,
the "1940 Act");
WHEREAS, DSIL has entered into a Management Agreement (the "Management
Agreement") with the Trust wherein DSIL has agreed to provide certain investment
advisory services for the series of the Trust designated as Domini Social Bond
Fund (the "Fund"); and
WHEREAS, as permitted by Section 1 of the Management Agreement, DSIL wishes
to subcontract some of the performance of its obligations thereunder to the
Submanager, and the Submanager desires to accept such obligations on the terms
and conditions hereinafter set forth.
NOW, THEREFORE, in consideration of the mutual covenants and agreements of
the parties hereto as herein set forth, the parties covenant and agree as
follows:
1. APPOINTMENT OF SUBMANAGER.
In accordance with and subject to the Management Agreement between the
Trust and the Manager with respect to the Fund, the Manager hereby retains the
Submanager to act as the Submanager for the Fund for the period and on the terms
set forth in this Agreement. The Submanager accepts such appointment and agrees
to provide an investment program for the Fund for the compensation provided by
this Agreement.
2. DUTIES OF THE SUBMANAGER.
The Submanager shall provide the Fund and the Manager with such investment
advice and supervision as the Manager may from time to time consider necessary
for the proper supervision of such portion of the Fund's investment assets as
the Manager may designate from time to time. Notwithstanding any provision of
this Agreement, the
-2-
Manager shall retain all rights and ultimate responsibilities to supervise and,
in its discretion, conduct investment activities relating to the Fund.
The Submanager shall furnish continuously an investment program and shall
determine from time to time what securities shall be purchased, sold or
exchanged and what portion of the assets of the Fund allocated by the Manager to
the Submanager shall be held uninvested, subject always to the restrictions of
the Trust's Second Amended and Restated Declaration of Trust, dated June 7,
1989, as last amended and restated on May 15, 2001, and By-laws, as each may be
amended and restated from time to time (respectively, the "Declaration" and the
"By-Laws"), the provisions of the 1940 Act, and the then-current registration
statement of the Trust with respect to the Fund and, subject further, to the
Submanager notifying the Manager in advance of the Submanager's intention to
purchase any securities except insofar as the requirement for such notification
may be waived or limited by the Manager, it being understood that the Submanager
shall be responsible for compliance with any restrictions imposed in writing by
the Manager from time to time in order to facilitate compliance with the
above-mentioned restrictions and such other restrictions as the Manager may
determine. Further, the Manager or the Trustees of the Trust may at any time,
upon written notice to the Submanager, suspend or restrict the right of the
Submanager to determine what securities shall be purchased or sold on behalf of
the Fund and what portion, if any, of the assets of the Fund allocated by the
Manager to the Submanager shall be held uninvested. The Submanager shall also,
as requested, make recommendations to the Manager as to the manner in which
proxies, voting rights, rights to consent to corporate action and any other
rights pertaining to the Fund's portfolio securities shall be exercised. Should
the Board of Trustees of the Trust or the Manager at any time, however, make any
definite determination as to an investment policy applicable to the Fund and
notify the Submanager thereof in writing, the Submanager shall be bound by such
determination for the period, if any, specified in such notice or until
similarly notified that such determination has been revoked.
The Submanager shall take, on behalf of the Fund, all actions which it
deems necessary to implement the investment policies determined as provided
above and, in particular, to place all orders for the purchase or sale of
securities for the Fund's account with the brokers or dealers selected by it,
and to that end the Submanager is authorized as the agent of the Fund to give
instructions to the custodian or any subcustodian of the Fund as to deliveries
of securities and payments of cash for the account of the Fund. The Submanager
will advise the Manager on the same day it gives any such instructions. In
connection with the selection of such brokers or dealers and the placing of such
orders, brokers or dealers may be selected who also provide brokerage and
research services (as those terms are defined in Section 28(e) of the Securities
Exchange Act of 1934) to the Fund and/or the other accounts over which the
Submanager, the Manager or a respective "affiliated person" thereof exercises
investment discretion. The Submanager is authorized to pay a broker or dealer
who provides such brokerage and research services a commission for executing a
portfolio transaction for the Fund which is in excess of the amount of
commission another broker or dealer would have charged for effecting that
transaction if the Submanager determines in good faith that such amount of
commission is reasonable in relation to the value of the brokerage and research
services provided by such broker or
-3-
dealer. This determination may be viewed in terms of either that particular
transaction or the overall responsibilities which the Submanager, the Manager
and any "affiliated person" thereof have with respect to accounts over which
they exercise investment discretion. The Trustees of the Trust shall
periodically review the commissions paid by the Fund to determine if the
commissions paid over representative periods of time were reasonable in relation
to the benefits to the Fund. In making purchases or sales of securities or other
property for the account of the Fund, the Submanager may deal with itself or
with the Trustees of the Trust or the Fund's underwriter or distributor to the
extent such actions are permitted by the 1940 Act. The Board of Trustees of the
Trust, in its discretion, may instruct the Submanager to effect all or a portion
of its securities transactions with one or more brokers and/or dealers selected
by the Board of Trustees if it determines that the use of such brokers and/or
dealers is in the best interest of the Fund.
3. ALLOCATION OF CHARGES AND EXPENSES.
The Submanager shall furnish at its own expense all necessary services,
facilities and personnel in connection with its responsibilities under Section 2
above. Except as provided in the foregoing sentence, it is understood that the
Trust will pay all of its own expenses including, without limitation,
organization costs of the Trust; compensation of Trustees who are not
"interested persons" of the Trust; governmental fees; interest charges; loan
commitment fees; taxes; membership dues in industry associations allocable to
the Trust; fees and expenses of independent auditors, legal counsel and any
transfer agent, distributor, registrar or dividend disbursing agent of the
Trust; expenses relating to the issuance and redemption of shares of beneficial
interest of the Fund and servicing shareholder accounts; expenses of preparing,
typesetting, printing and mailing prospectuses, statements of additional
information, shareholder reports, notices, proxy statements and reports to
governmental officers and commissions and to shareholders of the Fund; expenses
connected with the execution, recording and settlement of security transactions;
insurance premiums; fees and expenses of the custodian for all services to the
Fund, including safekeeping of funds and securities and maintaining required
books and accounts; expenses of calculating the net asset value of the Fund
(including but not limited to the fees of independent pricing services);
expenses of meetings of the Fund's shareholders; and such non-recurring or
extraordinary expenses as may arise, including those relating to actions, suits
or proceedings to which the Trust on behalf of the Fund may be a party and the
legal obligation which the Trust may have to indemnify its Trustees and officers
with respect thereto.
4. COMPENSATION OF THE SUBMANAGER.
(a) From the date of this Agreement to but not including July 29, 2005
or, if earlier, the date on which this Agreement is approved by the shareholders
of the Fund in accordance with the 1940 Act, the Manager shall pay to the
Submanager out of the management fee it receives from the Trust out of the
assets of the Fund, and only to the extent thereof, a subadvisory fee, accrued
daily and paid monthly at an annual rate equal to 0.20% of the average daily net
assets of the Fund allocated to the Submanager.
-4-
(b) If this Agreement is approved by the shareholders of the Fund in
accordance with the 1940 Act then, from and after the date of such approval, the
Manager shall pay to the Submanager out of the management fee it receives from
the Trust out of the assets of the Fund, and only to the extent thereof, a
subadvisory fee, accrued daily and paid monthly, at the following annual rates
of the Fund's average daily net assets during the month:
0.40% per year on the first $10 million managed
0.35% per year on the next $10 million managed
0.30% per year on the next $30 million managed
0.25% per year on the next $30 million managed
0.20% per year on the next $120 million managed
0.15% per year on the next $300 million managed
0.10% per year on the next $500 million managed
0.05% per year on amounts over $1 billion
(c) Notwithstanding clauses (a) and (b) of this section, the
subadvisory fees payable by the Manager hereunder shall not exceed $180,000 for
the period from the date of this Agreement through March 1, 2006.
(d) Subject to the approval of this Agreement by the shareholders of
the Fund in accordance with the 1940 Act, the Manager will pay to the Submanager
additional compensation, as consideration for the Submanager's services provided
to the Fund during the term of this Agreement, in an amount equal to (i) the
amount that would have been payable to the Submanager for the period from the
date of this Agreement to but not including the date on which this Agreement is
approved by the shareholders of the Fund in accordance with the 1940 Act (the
"Interim Period") if the fee schedule set forth in paragraph (b) above had been
in effect during the Interim Period minus (ii) the amount actually paid to the
Submanager pursuant to paragraph (a) above during the Interim Period. Any such
compensation, if payable, will be paid by the Manager to the Submanager after
this Agreement has been approved by the shareholders of the Fund in accordance
with the 1940 Act. If the shareholders of the Fund do not approve this Agreement
in accordance with the 1940 Act, the Submanager will not be entitled to any such
additional compensation and the Manager's obligation to provide such additional
compensation will terminate.
(e) If the Submanager serves as Submanager for less than the whole of
any period specified in this Section 4, the compensation of the Submanager, as
Submanager, shall be accordingly adjusted and prorated.
5. COVENANTS OF THE SUBMANAGER.
The Submanager agrees that it will not deal with itself, or with the
Trustees of the Trust or the Trust's principal underwriter or distributor, if
any, as principals in making purchases or sales of securities or other property,
except as permitted by the 1940 Act, will not take a long or short position in
shares of beneficial interest of the Fund, except as permitted by the
Declaration, and will comply with all other provisions of the Declaration
-5-
and By-Laws and the then-current registration statement of the Trust applicable
to the Fund relative to the Submanager and its directors and officers. The
Submanager shall not act as custodian for the Fund or take or have possession of
any assets thereof.
6. LIMITATION OF LIABILITY OF THE SUBMANAGER.
The Submanager shall not be liable for any error of judgment or mistake of
law or for any loss arising out of any investment or for any act or omission in
the execution of securities transactions for the Fund, except for willful
misfeasance, bad faith or gross negligence in the performance of its duties, or
by reason of reckless disregard of its obligations and duties hereunder. As used
in this Section 6, the term "Submanager" shall include directors, officers and
employees of the Submanager as well as the Submanager itself. The Trust is
expressly made a third party beneficiary of this Agreement and may enforce any
obligations of the Submanager under this Agreement and recover directly from the
Submanager for any liability the Submanager may have hereunder.
7. ACTIVITIES OF THE SUBMANAGER.
The services of the Submanager to the Fund are not to be deemed to be
exclusive, the Submanager being free to render investment advisory and/or other
services to others. It is understood that Trustees and officers of the Trust and
shareholders of the Fund or the Manager are or may be or may become interested
in the Submanager as directors, officers, employees or otherwise and that
directors, officers and employees of the Submanager are or may become similarly
interested in the Trust or the Fund or the Manager and that the Submanager may
be or may become interested in the Trust or the Fund as a shareholder or
otherwise.
8. CONFIDENTIAL RELATIONSHIP.
All information and recommendations furnished by the Submanager shall be
regarded as confidential and for use only by DSIL or such persons as DSIL may
designate, and only in connection with the management of the Fund. The
Submanager shall regard as confidential all information furnished to it
hereunder concerning the affairs of the Fund and DSIL. All confidential
information provided by a party hereto shall be used by the other party hereto
solely for the purpose of rendering or obtaining services pursuant to this
Agreement and, except as may be required in carrying out this Agreement, shall
not be disclosed to any third party without the prior written consent of such
providing party. The foregoing shall not be applicable to any information that
is publicly available when provided or thereafter becomes publicly available
other than through a breach of this Agreement, known to the receiving party
prior to entering into this Agreement, is received from some other source not a
party to this Agreement, or is required to be disclosed by or to any regulatory
authority, any auditor of the parties hereto, or by judicial or administrative
process or otherwise by applicable law. Throughout the life of this Agreement,
unless notified otherwise in writing by DSIL, the Submanager is authorized to
include DSIL's name on a publicly available list of its current clients.
-6-
9. RECEIPT OF DISCLOSURE DOCUMENT.
DSIL acknowledges that it has received a copy of the Trusco Capital
Management disclosure document under Rule 204-3 of the Investment Advisers Act
of 1940 at least 48 hours prior to entering into this Agreement.
10. REPRESENTATIONS AND WARRANTIES.
Each party represents and warrants that: (a) the person(s) executing this
Agreement on behalf of the party has full power and authority to execute this
Agreement on behalf of the party and (b) the party's execution, delivery and
performance of this Agreement will be binding upon the party in accordance with
the terms hereof, and will not violate any obligations by which the party is
bound, whether arising by contract, operation of law or otherwise.
11. DURATION, TERMINATION AND AMENDMENTS OF THIS AGREEMENT.
This Agreement shall become effective as of the day and year first above
written, shall govern the relations between the parties hereto thereafter and
shall remain in force until March 1, 2007, on which date it will terminate
unless its continuance after March 1, 2007 is "specifically approved at least
annually" (a) by the vote of a majority of the Trustees of the Trust who are not
"interested persons" of the Trust or of DSIL or the Submanager at a meeting
specifically called for the purpose of voting on such approval and (b) by the
Board of Trustees of the Trust or by "vote of a majority of the outstanding
voting securities" of the Fund. Notwithstanding the immediately preceding
sentence of this Section 11, this Agreement shall terminate on July 29, 2005
unless on or before such date this Agreement is approved by the shareholders of
the Fund in accordance with the 1940 Act.
This Agreement may be terminated at any time without the payment of any
penalty by (i) the Trustees of the Trust, (ii) the "vote of a majority of the
outstanding voting securities" of the Fund or (iii) DSIL with the prior consent
of the Trustees of the Trust, in each case on not more than 60 days' nor less
than 30 days' written notice to the other party. This Agreement may be
terminated at any time without the payment of any penalty by the Submanager on
not less than 90 days' written notice to the Manager and the Trustees of the
Trust. This Agreement shall automatically terminate in the event of its
"assignment."
This Agreement constitutes the entire agreement between the parties and may
be amended only if such amendment is approved by the parties hereto, the
Trustees of the Trust and the "vote of a majority of the outstanding voting
securities" of the Fund (except for any such amendment as may be effected in the
absence of such vote without violating the 1940 Act or any exemptive order
granted thereunder).
The terms "specifically approved at least annually," "vote of a majority of
the outstanding voting securities," "assignment," "affiliated person" and
"interested persons," when used in this Agreement, shall have the respective
meanings specified in, and shall be
-7-
construed in a manner consistent with, the 1940 Act, subject, however, to such
exemptions as may be granted by the Securities and Exchange Commission under the
Act.
12. GOVERNING LAW.
This Agreement shall be construed and the provisions thereof interpreted
under and in accordance with the laws of the Commonwealth of Massachusetts;
provided, however, that nothing herein will be construed in a manner
inconsistent with the 1940 Act, the Investment Advisers Act of 1940 or any rules
or regulations of the Securities and Exchange Commission thereunder.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed and delivered in their names and on their behalf by the undersigned,
thereunto duly authorized, all as of the day and year first above written.
SEIX ADVISORS
A division of TRUSCO CAPITAL
MANAGEMENT, INC.
By: /s/ Robin J. Shulman
--------------------------------
Title: Compliance Officer and
Managing Director
DOMINI SOCIAL INVESTMENTS LLC
By: /s/ Amy L. Domini
--------------------------------
Title: CEO
Acknowledged:
DOMINI SOCIAL INVESTMENT TRUST
On behalf of Domini Social Bond Fund
By: /s/ Carole M. Laible
--------------------------------
Title: Treasurer
Exhibit B
Information Regarding Mutual Funds Managed by Seix Advisors,
the Fixed-Income Division of Trusco Capital Management, Inc.
Contractual Fees Fees After Waivers
Net Assets (Annual rates based on (Annual rates based on
Fund as of 3/31/05(1) net assets) net assets)
---- ---------------- ----------- -----------
STI Classic Institutional $297,713,000 0.25% 0.25%
Core Bond Fund
STI Classic Investment $644,605,000 0.74% 0.74%
Grade Bond Fund
STI Classic Institutional $ 55,152,000 0.25% 0.25%
Intermediate Bond Fund
STI Classic Variable Trust $ 16,298,000 0.74% 0.48%
Investment Grade Bond Fund
STI Classic Institutional $ 64,097,000 0.45% 0.35%
Total Return Bond Fund
STI Classic Institutional $ 63,982,000 0.50% 0.40%
High Quality Bond Fund
(1) Net assets as of 3/31/2005 are rounded to the nearest thousand.
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[DOMINI SOCIAL INVESTMENTS LOGO] | THREE EASY WAYS TO VOTE YOUR PROXY |
P.O. Box 9785, Providence, RI 02940-9785 | |
| Read the Proxy Statement and have the proxy card at hand. |
| |
| TELEPHONE: Call 1-800-690-6903 and follow the simple instructions. |
| INTERNET: Go to www.proxyweb.com and follow the online directions. |
| MAIL: Vote, sign, date, and return your proxy by mail. |
| If you vote by Telephone or on the Internet, do not mail your proxy. |
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NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
DOMINI SOCIAL BOND FUND To be held Tuesday, June 28, 2005
The undersigned, revoking prior proxies, hereby appoints Amy L. Domini, Adam Kanzer, Carole M. Laible, and Steven D. Lydenberg, and
each of them, proxies with several powers of substitution, to vote for the undersigned at the Special Meeting of Shareholders of
Domini Social Bond Fund on June 28, 2005, as set forth on the reverse side of this proxy card, or at any adjournment thereof, upon
the following matter, as described in the Notice of Special Meeting and accompanying Proxy Statement, which have been received by
the undersigned.
When properly executed, this proxy will be voted in the manner directed herein by the undersigned shareholder. Proposal 1 has been
proposed by the Board of Trustees of the Fund. If no direction is given as to Proposal 1, this proxy will be voted "FOR" Proposal
1. The proxy will be voted in accordance with the holder's best judgment as to any other matters.
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Date __________________, 2005
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| |
| |
| |
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Signature(s)/Title(s) (if required) (Sign in the Box)
Note: Please sign exactly as your name appears hereon. If
shares are held jointly, each holder should sign. Corporate
proxies should be signed by an authorized officer. Trustees
and other fiduciaries should indicate the capacity in which
they sign, and where more than one name appears, a majority
must sign.
- - DSBF fg
LABEL BELOW FOR MIS USE ONLY! MIS EDITS: # OF CHANGES ___/___ PRF 1 ___ PRF 2 ____
PO# 1002
DOMINI SOCIAL INVESTMENTS LLC # OK TO PRINT AS IS* ____________ *By signing this form you are
DOMINI SOCIAL BOND FUND authorizing MIS to print this form in its current state.
ORIGINAL 2UP 4/20/05 TD
FRANK (DOMINI SOCIAL BOND FUND JUN 2005 FG) _______________________________________________________________________
REVIEW #1/PE #1 4-21-05 JA SIGNATURE OF PERSON AUTHORIZING PRINTING DATE
REVISION #1/PE 4/29/05 TD
PE 4-29-05 KD
REVISION/PE 5/2/05 TD
REVISION #3 5-03-05 KD
PE 5/5/O5 TD
- Please fill in box(es) as shown using black or blue ink or number 2 pencil. [X] -
PLEASE DO NOT USE FINE POINT PENS.
Please review the proposal listed below carefully.
The Board of Trustees of the Fund recommends that you vote in favor of Proposal 1.
FOR AGAINST ABSTAIN
Proposal 1. To approve a Submanagement Agreement for the Fund between Seix [ ] [ ] [ ]
Advisors, the fixed-income division of Trusco Capital Management,
Inc., and Domini Social Investments LLC.
IMPORTANT!
PLEASE SIGN AND DATE ON THE REVERSE SIDE.
- DSBF fg -
LABEL BELOW FOR MIS USE ONLY! MIS EDITS: # OF CHANGES ___/___ PRF 1 ___ PRF 2 ____
PO# 1002
DOMINI SOCIAL INVESTMENTS LLC # OK TO PRINT AS IS* ____________ *By signing this form you are
DOMINI SOCIAL BOND FUND authorizing MIS to print this form in its current state.
ORIGINAL 2UP 4/20/05 TD
FRANK (DOMINI SOCIAL BOND FUND JUN 2005 FG) _______________________________________________________________________
REVISION #1 4/29/05 TD SIGNATURE OF PERSON AUTHORIZING PRINTING DATE