(File Nos. 2-67052 and 811-3023)
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934
(Amendment No. )
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Check the appropriate box:
[ ] Preliminary Proxy Statement
[X] 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 ss.240.14a-11(c) or
ss.240.14a-12
FORUM FUNDS
Two Portland Square
Portland, Maine 04101
(207) 879-1900
David M. Whitaker
Citigroup Fund Services, LLC
Two Portland Square
Portland, Maine 04101
Copies to:
Robert J. Zutz, Esq.
Kirkpatrick & Lockhart Nicholson Graham LLP
1800 Massachusetts Avenue NW
Washington, D.C. 20036
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
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2) Aggregate number of securities to which transaction
applies:
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3) Per unit price or other underlying value of transaction
computed pursuant to Exchange Act Rule 0-11:
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[ ] 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:
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GOLDEN LARGE CORE VALUE FUND
GOLDEN SMALL CORE VALUE FUND
TWO PORTLAND SQUARE
PORTLAND, MAINE 04101
January 26, 2006
Dear Shareholder:
The Board of Trustees of Forum Funds (the "Trust") has called a special
meeting of the shareholders of Golden Large Core Value Fund and Golden Small
Core Value Fund, each a series of the Trust (collectively, the "Funds"), to
approve a new Investment Advisory Agreement between the Trust and Golden
Capital Management, LLC ("Golden") (the "New Agreement"). The meeting is
scheduled to be held on February 24, 2006.
For the period of September 13, 2005 (commencement of operations of the
Funds) through September 29, 2005, Golden served as the Funds' investment
adviser pursuant to an Investment Advisory Agreement between the Trust and
Golden ("Original Agreement"). During that period, Strategic Investment Group
Ventures, LLC ("Strategic") maintained a 50% equity interest in Golden; GCM
Partners, Inc. ("GCM") maintained a 40% equity interest in Golden and a third
party maintained the remaining 10%. On September 30, 2005, Strategic sold its
equity interest in Golden to GCM and Evergreen Alternative Strategies, Inc. (a
wholly owned subsidiary of the Wachovia Corporation) ("Evergreen").
Additionally, GCM acquired the third party's equity interest in a separate
transaction. Accordingly, as of that date, GCM owns an equity interest of 55%
in Golden while Evergreen owns 45% (the "Transfer").
Since the Transfer would result in an assignment and termination of the
Original Agreement pursuant to the terms of such agreement and the Investment
Company Act of 1940, as amended, the Trust's Board of Trustees (the "Board"),
by unanimous approval, terminated the Original Agreement effective prior to
Golden's change in control on September 29, 2005 and appointed Golden, with its
restructured ownership, as the Funds' investment adviser pursuant to an interim
Investment Advisory Agreement between the Trust and Golden with respect to the
Funds dated September 30, 2005 (the "Interim Agreement"). The Interim Agreement
was approved by the Board at its September 22, 2005 meeting and will remain in
effect for 150 days from the date of termination of the Original Agreement or
until the date that the Funds' shareholders approve the New Agreement,
whichever is earlier. The Board also unanimously approved the New Agreement at
its September 22, 2005 meeting. The terms of the New Agreement are identical in
all material respects to those of the Original Agreement but for the effective
date. The Board recommends that the Funds' shareholders vote "FOR" the approval
of the New Agreement.
WHETHER OR NOT YOU EXPECT TO ATTEND THE SPECIAL MEETING, PLEASE COMPLETE,
DATE AND SIGN THE ENCLOSED PROXY CARD AND MAIL IT PROMPTLY IN THE ENCLOSED
ENVELOPE IN ORDER TO ASSURE REPRESENTATION OF YOUR SHARES (UNLESS YOU ARE
VOTING BY TELEPHONE OR VIA THE INTERNET). NO POSTAGE NEED BE AFFIXED IF THE
PROXY CARD IS MAILED IN THE UNITED STATES. THE PROXY IS REVOCABLE AT ANY TIME
PRIOR TO ITS USE. IT IS IMPORTANT THAT YOUR VOTE BE RECEIVED NO LATER THAN
FEBRUARY 23, 2006. IF YOU HAVE ANY QUESTIONS ABOUT THE PROXY STATEMENT, PLEASE
DO NOT HESITATE TO CALL US AT (800) 206-8610.
We appreciate your participation and prompt response and thank you for your
continued support of the Funds.
Sincerely,
/s/ David M. Whitaker
David M. Whitaker
Secretary
GOLDEN LARGE CORE VALUE FUND
GOLDEN SMALL CORE VALUE FUND
TWO PORTLAND SQUARE
PORTLAND, MAINE 04101
-----------------
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
FEBRUARY 24, 2006
-----------------
To the Shareholders of
Golden Large Core Value Fund and Golden Small Core Value Fund:
NOTICE IS HEREBY GIVEN that a special meeting of shareholders (the
"Meeting") of Golden Large Core Value Fund and Golden Small Core Value Fund,
each a series of Forum Funds (the "Trust"), will be held at the offices of
Citigroup Fund Services, LLC, Two Portland Square, Portland, Maine 04101 on
February 24, 2006 at 2:00 p.m. (Eastern time). The purpose of the Meeting is:
1. To approve an Investment Advisory Agreement between the Trust and Golden
Capital Management, LLC;
2. To transact such other business as may properly come before the Meeting.
The Trust's Board of Trustees has fixed the close of business on January 5,
2006 as the record date for the determination of shareholders entitled to
notice of, and to vote at, the Meeting or any postponement or adjournment
thereof. Please carefully read the accompanying Proxy Statement.
By order of the Board of Trustees,
/s/ David M. Whitaker
David M. Whitaker
Secretary
Portland, Maine
January 26, 2006
YOUR VOTE IS VERY IMPORTANT NO MATTER HOW MANY SHARES YOU
OWN. IN ORDER TO AVOID THE UNNECESSARY EXPENSE OF FURTHER
SOLICITATION, WE URGE YOU TO INDICATE YOUR VOTING INSTRUCTIONS
(1) ON THE ENCLOSED PROXY, DATE AND SIGN IT, AND RETURN IT
PROMPTLY IN THE ENVELOPE PROVIDED; (2) BY CALLING (TOLL FREE),
THE TELEPHONE NUMBER ON YOUR PROXY CARD; OR (3) BY LOGGING
ONTO THE INTERNET ADDRESS ON YOUR PROXY CARD.
TABLE OF CONTENTS
PAGE
---------
INTRODUCTION........................... 1
PROPOSAL............................... 3
Background Information.............. 3
The Interim Agreement............... 3
The New Agreement................... 3
Evaluation by the Board of Trustees. 5
INFORMATION ABOUT GOLDEN............... 6
OTHER MATTERS.......................... 7
ADDITIONAL INFORMATION................. 7
Other Fund Service Providers........ 7
Reports to Shareholders............. 8
ADVISORY AGREEMENT..................... EXHIBIT A
PROXY CARD
-----------------
PROXY STATEMENT
-----------------
GOLDEN LARGE CORE VALUE FUND
GOLDEN SMALL CORE VALUE FUND
TWO PORTLAND SQUARE
PORTLAND, MAINE 04101
-----------------
SPECIAL MEETING OF SHAREHOLDERS
FEBRUARY 24, 2006
-----------------
INTRODUCTION
This Proxy Statement is furnished in connection with the solicitation of
proxies by the Board of Trustees (the "Board") of Forum Funds (the "Trust"), on
behalf of Golden Large Core Value Fund ("Large Core Fund") and Golden Small
Core Value Fund ("Small Core Fund"), each a series of the Trust (each, a "Fund"
and collectively, the "Funds"), to approve a new Investment Advisory Agreement
between the Trust and Golden Capital Management, LLC ("Golden") (the
"Proposal") with respect to the Funds. The Trust is a registered open-end
investment company whose executive offices are located at Two Portland Square,
Portland, Maine 04101. Proxies will be voted at a special meeting of
shareholders (the "Meeting") of the Funds to be held at the offices of the
Trust's administrator, Citigroup Fund Services, LLC ("Citigroup"), Two Portland
Square, Portland, Maine 04101 on February 24, 2005, at 2:00 p.m. (Eastern
time), or at any postponement or adjournment thereof for the purposes set forth
in the accompanying Notice of Special Meeting of Shareholders. The Notice of
Meeting, this Proxy Statement and the proxy card are first being mailed to
shareholders on or about February 3, 2006.
The Board has fixed the close of business on January 5, 2006 as the record
date (the "Record Date") for the determination of shareholders of the Funds
entitled to notice of, and to vote at, the Meeting and any postponement or
adjournment thereof. As of the Record Date, there were 223,727.84 shares and
666,017.42 shares outstanding of the Large Core Fund and Small Core Fund,
respectively. Each shareholder will be entitled to one vote for each whole Fund
share and a fractional vote for each fractional Fund share held. Shares may be
voted in person or by proxy. Shareholders holding one-third of the outstanding
shares of a Fund as of the Record Date present in person or by proxy will
constitute a quorum for the transaction of business regarding that Fund at the
Meeting. All properly executed proxies received on or before February 23, 2006
will be counted at the Meeting and any adjournment thereof in accordance with
the instructions marked thereon or otherwise provided therein. Proxies received
after that date will be counted only if the Meeting is adjourned.
For purposes of determining the presence of a quorum and counting votes on
the matters presented, Fund shares represented by abstentions and "broker
non-votes" will be counted as present, but not as votes cast at the Meeting.
Broker non-votes are Fund shares held in street name for which the broker
indicates that instructions have not been received from the beneficial owners
and other persons entitled to vote and for which the broker lacks discretionary
voting authority. Under the Investment Company Act of 1940 (the "1940 Act"),
the affirmative vote necessary to approve the Proposal may be determined with
reference to a percentage of votes present at the Meeting. For this reason,
abstentions and broker non-votes have the effect of votes "AGAINST" the
Proposal. In completing proxies, therefore, shareholders should be aware that
checking the box labeled "ABSTAIN" would result in the shares covered by the
proxy being treated as if they were voted "AGAINST" the Proposal.
IF A CHOICE IS NOT SPECIFIED ON A PROPERLY EXECUTED PROXY THAT IS RETURNED
IN TIME TO BE VOTED AT THE MEETING, THE PROXY WILL BE VOTED "FOR" THE PROPOSAL
FOR WHICH THE PROXY WAS SUBMITTED.
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, the
persons named as proxies may propose one or more adjournments of the
Meeting to permit further solicitation of proxies with respect to the Proposal.
Any adjournment will require the affirmative vote of a majority of shares
represented in person or by proxy at the Meeting. In that case, the persons
named as proxies will vote all proxies that they are entitled to vote for the
Proposal as "FOR" such an adjournment; provided, however, any proxies required
to be voted against the Proposal will be voted "AGAINST" such adjournment.
Abstentions and broker non-votes will not be voted "FOR" or "AGAINST" any
adjournment. A shareholder vote may be taken on the Proposal prior to
adjournment if sufficient votes have been received and it is otherwise
appropriate.
Approval of the Proposal by a Fund requires the affirmative vote of either
(a) 67% or more of the shares of that Fund present at the Meeting or
represented by proxy if the holders of more than 50% of the outstanding shares
are present or represented by proxy at the Meeting or (b) more than 50% of the
outstanding shares of that Fund. The approval of the Proposal by the
shareholders of one Fund is not contingent on the approval of the Proposal by
the shareholders of the other Fund.
You may vote on each proposal by utilizing one of the following options:
BY MAIL: Complete the enclosed proxy card ("Proxy Card") and return it in the postage paid envelope
provided.
BY TELEPHONE: Call the Toll-Free number on your Proxy Card.
BY INTERNET: Use the Internet address on your Proxy Card.
IN PERSON: Attend the Special Meeting in person at 2:00 p.m. (Eastern time) on February 24, 2006, at the
offices of Citigroup Fund Services, LLC, Two Portland Square, Portland, Maine 04101.
If you plan to vote by mail, you should complete the Proxy Card by:
(1)Indicating whether you vote "FOR", "AGAINST", or "ABSTAIN" from voting
on a proposal by checking the appropriate box on the Proxy Card;
(2)Signing and dating the Proxy Card; and
(3)Returning the Proxy Card in the enclosed postage-paid envelope.
To change your vote, you may send a written notice of revocation (the
"Revocation Letter") to Citigroup, at Two Portland Square, Portland, Maine,
04101, or by personally casting a vote at the Meeting. The Revocation Letter
must:
(1)Identify you;
(2)State that as a Fund shareholder, you revoke your prior vote; and
(3)Indicate your approval, disapproval or abstention from voting with
respect to the Proposal.
The solicitation of proxies will be primarily by mail but may also include
telephone or oral communications by the officers of the Trust, or by regular
employees of Golden, the Funds' investment adviser. Golden will bear all of the
costs of the Meeting and the preparation, printing, mailing and solicitation of
this Proxy Statement and the tabulation of the Proxy Cards.
2
PROPOSAL: APPROVAL OF INVESTMENT ADVISORY AGREEMENT
BETWEEN THE TRUST AND GOLDEN CAPITAL MANAGEMENT, LLC
BACKGROUND INFORMATION
For the period of September 13, 2005 (commencement of operations of the
Funds) through September 29, 2005, Golden served as the Funds' investment
adviser pursuant to an Investment Advisory Agreement between the Trust and
Golden ("Original Agreement"). During that period, Strategic Investment Group
Ventures, LLC ("Strategic") maintained a 50% equity interest in Golden; GCM
Partners, Inc. ("GCM") maintained a 40% equity interest in Golden and a third
party maintained the remaining 10%. The Board initially approved the Original
Agreement at its June 8, 2005 meeting while the Funds' initial shareholder,
Foreside Fund Services, LLC approved the Original Agreement on August 18, 2005
by written consent. Pursuant to the terms of the Original Agreement, the
agreement was to remain in effect for two years from the date of its
effectiveness and thereafter for successive annual periods provided that such
continuance was specifically approved at least annually: (i) by the Board or by
the vote of a majority of the outstanding voting securities of each Fund, and,
in either case; (ii) by a majority of the Trust's trustees who are not parties
to this Agreement or interested persons of any such party (other than as
trustees of the Trust) (the "Independent Trustees").
On September 30, 2005 and prior to the expiration of the initial term of the
Original Agreement, Strategic sold its interest in Golden to GCM and Evergreen
Alternative Strategies, Inc. (a wholly owned subsidiary of Wachovia
Corporation) ("Evergreen") pursuant to a purchase and sale agreement. Under a
separate agreement, GCM acquired an additional 10% equity interest in Golden
from a third party. Thus, GCM and Evergreen own equity interests of 55% and
45%, respectively (the "Transfer"). Since the Transfer would result in an
assignment and termination of the Original Agreement pursuant to the terms of
such agreement and the 1940 Act, the Trust's Board, by unanimous approval,
terminated the Original Agreement effective September 29, 2005, and appointed
Golden, with its restructured ownership, as the Funds' investment adviser
pursuant to an interim Investment Advisory Agreement between the Trust and
Golden with respect to the Funds dated September 30, 2005 (the "Interim
Agreement"). The Interim Agreement was approved at the Board's September 22,
2005 meeting and will remain in effect for 150 days from the date of
termination of the Original Agreement or until the date that the Funds'
shareholders approve a new Investment Advisory Agreement between the Trust and
Golden (as restructured) (the "New Agreement"), whichever is earlier. The New
Agreement also was unanimously approved by the Board at its September 22, 2005
meeting. The terms of the New Agreement are identical in all material respects
to those of the Original Agreement but for the effective date. The Board
recommends that the Funds' shareholders vote "FOR" the approval of the New
Agreement.
THE INTERIM AGREEMENT
The Interim Agreement was approved by the Board, including the Independent
Trustees, at its September 22, 2005 meeting. The Board, including the
Independent Trustees, determined that the scope and quality of services to be
provided to the Funds under the Interim Agreement were equivalent to the scope
and quality of services provided under the Original Agreement. The terms of the
Interim Agreement are identical in all material respects to those of the
Original Agreement, except for the effective period. The Interim Agreement
provides for a termination date no later than 150 days from the date of the
termination of the Original Agreement or upon approval of the New Agreement by
shareholders, whichever is earlier.
THE NEW AGREEMENT
The Board, including the Independent Trustees, unanimously approved the New
Agreement for the Funds at its September 22, 2005 Board meeting subject to
approval of the New Agreement by the Funds' shareholders. The terms, including
the advisory fee, of the New Agreement are identical in all material respects
to those of the Original Agreement.
3
Under the New Agreement, the Trust will engage Golden, subject to the
direction and control of the Board, and Golden will manage the investment and
reinvestment of the assets of the Funds. Under the New Agreement, Golden will
receive from the Large Core Fund an annual fee of 0.70% of the Fund's average
daily net assets and from the Small Core Fund an annual fee of 1.10% of the
Fund's average daily net assets for rendering investment advisory services to
the Fund.
The New Agreement requires Golden to:
(1)make decisions with respect to all purchases and sales of securities and
other investment assets in the Funds;
(2)pay all operating expenses of the Funds, including the fees and expenses
of the custodian, transfer agent, dividend disbursing agent, shareholder
service agent, plan agent, administrator, accounting and pricing
services agent and underwriter of the Funds; expenses of issue, sale,
redemption or repurchase of shares of the Funds; the cost of preparing
and distributing reports and notices to shareholders, the cost of
printing or preparing prospectuses and statements of additional
information for delivery to the Funds' current and prospective
shareholders; the cost of printing or preparing stock certificates or
any other documents, statements or reports to shareholders; expenses of
shareholders' meetings and proxy solicitations; advertising, promotion
and other expenses incurred directly or indirectly in connection with
the sale or distribution of the Funds' shares excluding expenses which
the Funds are authorized to pay pursuant to Rule 12b-l under the 1940
Act; and all other operating expenses not specifically assumed by the
Funds;
(3)furnish to the Board, which has overall responsibility for the business
and affairs of the Trust, periodic reports concerning the performance
and operation of the Funds;
(4)maintain records relating to the advisory services rendered to the Funds
as required to be maintained by the Trust pursuant to applicable law,
including records pertaining to Fund transactions and the placing and
allocation of brokerage orders; and
(5)provide the Funds' custodian and fund accountant, on each Fund business
day, with information relating to all transactions concerning the Funds'
assets.
The New Agreement permits Golden to perform investment advisory services for
other entities other than the Trust and the Funds. The New Agreement also
provides that Golden shall not be liable to the Trust or the Funds for any
mistake of judgment or mistake of law or in any event whatsoever, except for
lack of good faith, willful misfeasance, bad faith or gross negligence in the
performance of its duties under the agreement or by reason of Golden's reckless
disregard of its obligations under the New Agreement or as otherwise required
by applicable law. Neither the Trustees of the Trust nor the shareholders of
the Funds are liable for any obligations of the Trust or of the Funds under the
New Agreement. Under the New Agreement, Golden agrees that, in asserting any
rights or claims under the agreement, it shall look only to the assets and
property of the Trust or the Fund to which Golden's rights or claims relate in
settlement of such rights or claims, and not to the Trustees of the Trust or
the shareholders of any Fund.
If the New Agreement with respect to each Fund is approved by the
shareholders, the New Agreement will be effective for an initial two year
period and thereafter will continue in effect for successive twelve-month
periods, provided that such continuance is specifically approved at least
annually (i) by the Board or by the vote of a majority of the outstanding
voting securities of the Fund, and, in either case (ii) by a majority of the
Independent Trustees. The New Agreement is terminable, without penalty, by the
Board or by a vote of a majority of the voting securities of a Fund on 60 days'
written notice to Golden or by Golden on 60 days' written notice to the Trust.
The New Agreement also provides for automatic termination in the event of its
assignment as that term is defined under the 1940 Act. The New Agreement may
only be amended or modified by a written agreement that is properly authorized
and executed by the Trust and Golden, and if required by law, by vote of a
majority of the outstanding voting securities of a Fund.
4
Any description of the New Agreement set forth herein is qualified in its
entirety by the provisions of the Form of Investment Advisory Agreement
attached hereto as Exhibit A. If shareholders do not approve the New Agreement
within 150 days of the effective date of the Transfer, the Board will take such
actions as it deems in the best interests of the Funds' shareholders.
Golden intends for the Transfer to satisfy the terms of Section 15(f) of the
1940 Act, and has represented that it will not increase its fees for the Funds
for the next two years.
EVALUATION BY THE BOARD OF TRUSTEES
At the September 22, 2005 Board meeting, the Board, including the
Independent Trustees, considered the approval of the New Agreement. In
evaluating the New Agreement, the Board reviewed materials furnished by Golden
and Citigroup, including information regarding: (1) services to be provided to
the Funds including the nature, extent and quality of such services and the
investment performance of Golden's separately managed accounts; (2) the
compensation to be paid to Golden including the cost of advisory services to be
provided and profits to be realized by Golden and its affiliates from the
relationship with the Funds; (3) the extent to which economies of scale would
be realized as the Funds grow and whether the advisory fee reflects these
economies of scale for the benefit of the Funds' investors; (4) other benefits
received by Golden and its affiliates from their relationship with the Funds;
(5) the continuation of services by other Fund service providers after the
Transfer; and (6) whether any burden on the Funds would result from the
Transfer. In particular, the Board focused on the following factors and made
the following conclusions in considering approval of the New Agreement:
SERVICES. In considering the nature, extent and quality of the services
provided to the Funds by Golden, the Board observed that the portfolio
management team has worked together since 1992. Golden represented that it
would continue to provide high quality portfolio management services to the
Funds under the New Agreement. Golden also represented that it has adequate
staffing levels to service the Funds and will be proactive in taking necessary
steps to ensure that adequate staffing levels are maintained as Golden grows.
The Board concluded that the approval of the New Agreement would not interfere
with the day-to-day management of the Funds and that Golden has the requisite
back office support to help ensure continuation of Fund operations under the
New Agreement. The Board also concluded that the scope and quality of services
to be provided to the Funds will be at least equivalent to the scope and
quality of services that have been provided under the previous investment
advisory agreement.
PERFORMANCE. The Board did not consider the Funds' performance as the Funds
are new and have no performance history. The Board did, however, consider the
portfolio management team's investment accounts using the same investment style
as the Funds and that these accounts have outperformed their primary benchmark
for the one-, three- and five-year periods ending March 31, 2005. The Board
concluded that performance was not a significant factor regarding approval of
the New Agreement due to the relatively short period that the Funds have been
in operation.
COMPENSATION AND ECONOMIES OF SCALE. The advisory fee to be paid by the
Funds under the New Agreement will be the same as the advisory fee paid by the
Funds under the Original and Interim Agreements. The Board considered Golden's
compensation for continuing to provide advisory services to the Funds and
analyzed comparative information on fees and total expenses of similar mutual
funds. The Board also discussed the difference in the advisory fees charged to
the Funds and the fees charged to Golden's other clients. The Board noted that
Golden's proposed gross and net advisory fees were within the range of their
Lipper Inc. peer groups, after considering that Golden would continue to pay
most Fund-related expenses out of its advisory fee. The Board observed that
Large Core Fund's proposed total expenses were lower than the mean and median
total expenses for its Lipper Inc. peer groups. The Board also observed that
Small Core Fund's proposed total expenses were lower than the mean and median
total expenses for its Lipper Inc. peer groups except for Investor Shares,
which while lower than the mean, was slightly above the median total expenses
for its Lipper Inc. peer group. The Board recognized that it was difficult to
make comparisons of expense ratios because of the variations in the services
that are included in the fees paid by other funds. The Board concluded that
Golden's advisory fee, after waivers, was reasonable when compared with the
Lipper Inc. peer group average.
5
The Board then considered whether the Funds would benefit from any economies
of scale, noting that the investment advisory fees for the Funds do not contain
breakpoints. The Board considered the anticipated size of the Funds and
concluded that it would not be necessary to consider the implementation of fee
breakpoints at this time.
OTHER BENEFITS TO GOLDEN. Golden represented that it did not expect to
receive any other benefits from its relationship with the Funds. Based on the
foregoing, the Board concluded that other benefits to be received by Golden
from its relationship with the Funds were not a material factor to consider in
approving the Advisory Agreement.
CONTINUITY OF SERVICE PROVIDERS. Citigroup will continue to serve as the
Funds' administrator, transfer agent, and fund accountant under existing
contracts. The Funds' custodian and distributor will also remain the same. The
Board concluded that the continuation of the Funds' other service provider
contracts would help ensure continuity of Fund operations under the New
Agreement.
NO UNDUE BURDEN ON THE FUNDS. The terms of the Original Agreement and New
Agreement are identical in all material respects but for the effective date.
The Board concluded that the approval of Transfer would not result in: (1) an
increase in the Funds' advisory fees or total expenses; (2) a change in
advisory services, portfolio management personnel, back office support or other
service provider services; or (3) costs to the Funds in order to seek
shareholder approval of the New Agreement.
Based upon its review, the Board concluded that the approval of the New
Agreement was reasonable, fair and in the best interests of the Funds and their
respective shareholders. The Board approved the New Agreement subject to the
approval of the New Agreement by the Funds' shareholders.
THE BOARD RECOMMENDS THAT THE SHAREHOLDERS OF EACH FUND VOTE "FOR" THE
PROPOSAL.
INFORMATION ABOUT GOLDEN CAPITAL MANAGEMENT, LLC
Golden Capital Management, LLC ("Golden"), 10715 David Taylor Drive, Suite
150, Charlotte, NC 28262, is a limited liability company organized under the
laws of Delaware.
Set forth below is information about each director, general partner, and
principal executive officer of Golden, each of whom may be contacted at
Golden's principal business address:
NAME (OFFICE) POSITION WITH ADVISER PRINCIPAL OCCUPATION
- ------------- ------------------------------- ----------------------------------
Greg W. Golden, CFA President and Chief Executive President, Chief Executive Officer
Officer and Portfolio Manager
Golden
Jeff C. Moser, CFA Managing Director and Chief Managing Director, Chief
Operating Officer Operating Officer and Portfolio
Manager
Golden
Jonathan W. Cangalosi Managing Director and Principal Managing Director and Principal
Golden
Lynette W. Alexander Managing Director Managing Director
Golden
GCM Partners, Inc. ("GCM"), 10715 David Taylor Drive, Suite 150, Charlotte,
NC 28262 and Evergreen (100% owned subsidiary of Wachovia Corporation), 401 S.
Tryon Street, Charlotte, NC 28288, own controlling interests in Golden. Greg W.
Golden, Jeff C. Moser and Jon Cangalosi own GCM.
6
Golden also manages the following other funds:
PHOENIX PHOENIX
TOTAL VALUE RELATIVE VALUE
FUND FUND
----------- --------------
Assets........................................... $9 million $2.3 million
Annual Advisory Fee (of average daily net assets) 0.45% 0.45%
OTHER MATTERS
No other matters are expected to be presented at the Meeting other than the
Proposal. If any other matter properly comes before the Meeting, the shares
represented by proxies will be voted with respect thereto in the discretion of
the person or persons voting the proxies.
It is anticipated that, following the Meeting, the Funds will not hold any
meetings of shareholders except as required by Federal law or Delaware state
law. Shareholders wishing to submit proposals for inclusion in a proxy
statement for a subsequent shareholder meeting should send proposals to the
Secretary of the Trust, David M. Whitaker, care of Citigroup Fund Services,
LLC, Two Portland Square, Portland, Maine 04101.
As of the Record Date, the Trustees and officers of the Trust, as a group,
owned beneficially less than 1% of the outstanding shares of the Funds. As of
the Record Date, the following shareholders beneficially or of record owned
more than 5% of the outstanding shares of the Funds:
% OF
FUND NAME AND ADDRESS SHARES FUND
---- ----------------------------- ----------- ------
Golden Large Core Value Fund Charles Schwab & Co. Inc. 207,645.445 92.81%
Special Custody FBO Customers
Attn: Mutual Funds
101 Montgomery Street
San Francisco, CA 94104
Golden Small Core Value Fund Charles Schwab & Co. Inc. 154,345.631 23.17%
Special Custody FBO Customers
Attn: Mutual Funds
101 Montgomery Street
San Francisco, CA 94104
ADDITIONAL INFORMATION
OTHER FUND SERVICE PROVIDERS
Citigroup provides administration, fund accounting, and transfer agency
services to the Trust. Citibank, N.A. serves as the Trust's custodian. Foreside
Fund Services, LLC ("Foreside"), located at Two Portland Square, Portland, ME
04101, serves as the Funds' principal underwriter. Pursuant to a Compliance
Services Agreement with the Trust, Foreside also provides the Trust with a
President, Chief Financial Officer and Chief Compliance Officer as well as with
certain other compliance services.
The service providers listed above will continue to provide the services
referenced above regardless of whether the Funds' shareholders approve the
Proposal.
7
REPORTS TO SHAREHOLDERS
The Funds do not have an annual report to provide to shareholders since the
Funds only began operations in September 2005.
By order of the Board of Trustees,
/s/ David M. Whitaker
David M. Whitaker
Secretary
8
EXHIBIT A
FORM OF
FORUM FUNDS
INVESTMENT ADVISORY AGREEMENT
AGREEMENT made as of , 2006, by and between Forum Funds, a
Delaware statutory trust, with its principal office and place of business at
Two Portland Square, Portland, Maine 04101 (the "Trust"), and Golden Capital
Management, LLC, with its principal office and place of business at 10715 David
Taylor Drive, Suite 150, Charlotte, NC 28262 (the "Adviser").
WHEREAS, the Trust is registered under the Investment Company Act of 1940,
as amended (the "1940 Act"), as an open-end, management investment company and
may issue its shares of beneficial interest, no par value (the "Shares"), in
separate series; and
WHEREAS, the Trust desires that the Adviser perform investment advisory
services for each series of the Trust listed in Appendix A hereto (the "Fund"),
and the Adviser is willing to provide those services on the terms and
conditions set forth in this Agreement;
NOW THEREFORE, for and in consideration of the mutual covenants and
agreements contained herein, the Trust and the Adviser hereby agree as follows:
SECTION 1. APPOINTMENT; DELIVERY OF DOCUMENTS
(a) The Trust hereby employs the Adviser, subject to the direction and
control of the Board, to manage the investment and reinvestment of the assets
in the Fund and, without limiting the generality of the foregoing, to provide
other services as specified herein. The Adviser accepts this employment and
agrees to render its services for the compensation set forth herein.
(b) In connection therewith, the Trust has delivered to the Adviser copies
of: (i) the Trust's Trust Instrument and Bylaws (collectively, as amended from
time to time, "Organic Documents"); (ii) the Trust's Registration Statement and
all amendments thereto with respect to the Fund filed with the U.S. Securities
and Exchange Commission ("SEC") pursuant to the Securities Act of 1933, as
amended (the "Securities Act"), or the 1940 Act (the "Registration Statement");
(iii) the Trust's current Prospectuses and Statements of Additional Information
of the Fund (collectively, as currently in effect and as amended or
supplemented, the "Prospectus"); and (iv) all procedures adopted by the Trust
with respect to the Fund (e.g., repurchase agreement procedures), and shall
promptly furnish the Adviser with all amendments of or supplements to the
foregoing (collectively the "Procedures"). The Trust shall deliver to the
Adviser: (x) a certified copy of the resolution of the Board of Trustees of the
Trust (the "Board") appointing the Adviser and authorizing the execution and
delivery of this Agreement; (y) a copy of all proxy statements and related
materials relating to the Fund; and (z) any other documents, materials or
information that the Adviser shall reasonably request to enable it to perform
its duties pursuant to this Agreement.
(c) The Adviser has delivered, or will deliver within 45 days, to the Trust
a copy of its code of ethics complying with the requirements of Rule 17j-1
under the 1940 Act (the "Code"). The Adviser shall promptly furnish the Trust
with all amendments of or supplements to the foregoing at least annually.
SECTION 2. DUTIES OF THE TRUST
In order for the Adviser to perform the services required by this Agreement,
the Trust: (i) shall cause all service providers to the Trust to furnish
information to the Adviser and to assist the Adviser as may be required; and
(ii) shall ensure that the Adviser has reasonable access to all records and
documents maintained by the Trust or any service provider to the Trust.
9
SECTION 3. DUTIES OF THE ADVISER
(a) The Adviser will make decisions with respect to all purchases and sales
of securities and other investment assets in the Fund. To carry out such
decisions, the Adviser is hereby authorized, as agent and attorney-in-fact for
the Trust, for the account of, at the risk of and in the name of the Trust, to
place orders and issue instructions with respect to those transactions of the
Fund. In all purchases, sales and other transactions in securities and other
investments for the Fund, the Adviser is authorized to exercise full discretion
and act for the Trust in the same manner and with the same force and effect as
the Trust might or could do with respect to such purchases, sales or other
transactions, as well as with respect to all other things necessary or
incidental to the furtherance or conduct of such purchases, sales or other
transactions, including voting of proxies with respect to securities owned by
the Fund, subject to such proxy voting policies as approved by the Board.
Consistent with Section 28(e) of the Securities and Exchange Act of 1934, as
amended (the "Exchange Act"), the Adviser may allocate brokerage on behalf of
the Fund to broker-dealers who provide research services. Subject to compliance
with Section 28(e), the Adviser may cause a Fund to pay to any broker-dealer
who provides research services a commission that exceeds the commission the
Fund might have paid to a different broker-dealer for the same transaction. The
Adviser may aggregate sales and purchase orders of the assets of the Fund with
similar orders being made simultaneously for other accounts advised by the
Adviser or its affiliates. Whenever the Adviser simultaneously places orders to
purchase or sell the same asset on behalf of a Fund and one or more other
accounts advised by the Adviser, the orders will be allocated as to price and
amount among all such accounts in a manner believed to be equitable over time
to each account.
(b) The Adviser will report to the Board at each meeting thereof as
requested by the Board all material changes in the Fund since the prior report,
and will also keep the Board informed of important developments affecting the
Trust, the Fund and the Adviser, and on its own initiative, will furnish the
Board from time to time with such information as the Adviser may believe
appropriate for this purpose, whether concerning the individual companies whose
securities are included in the Fund's holdings, the industries in which they
engage, the economic, social or political conditions prevailing in each country
in which the Fund maintain investments, or otherwise. The Adviser will also
furnish the Board with such statistical and analytical information with respect
to investments of the Fund as the Adviser may believe appropriate or as the
Board reasonably may request. In making purchases and sales of securities and
other investment assets for the Fund, the Adviser shall comply with the
directions set from time to time by the Board as well as the limitations
imposed by the Organic Documents and Registration Statement, the limitations in
the 1940 Act, the Securities Act, the Internal Revenue Code of 1986, as
amended, and other applicable laws and the investment objectives, policies and
restrictions of the Fund. The Adviser shall also comply with the Procedures
provided that the Adviser has adequate notice of the Procedures.
(c) The Adviser will from time to time employ or associate with such persons
as the Adviser believes to be particularly fitted to assist in the execution of
the Adviser's duties hereunder, the cost of performance of such duties to be
borne and paid by the Adviser. No obligation may be incurred on the Trust's
behalf in any such respect.
(d) The Adviser will report to the Board all material matters related to the
Adviser. On an annual basis, the Adviser shall report on its compliance with
its Code to the Board and upon the written request of the Trust, the Adviser
shall permit the Trust, or its representatives to examine the reports required
to be made to the Adviser under the Code. The Adviser will notify the Trust of
any change of control of the Adviser and any changes in the key personnel who
are either the portfolio manager(s) of a Fund or senior management of the
Adviser, in each case prior to or promptly after such change.
(e) The Adviser will maintain records relating to its portfolio transactions
and placing and allocation of brokerage orders as are required to be maintained
by the Trust under the 1940 Act. The Adviser shall prepare and maintain, or
cause to be prepared and maintained, in such form, for such periods and in such
locations as may be required by applicable law, all documents and records
relating to the services provided by the Adviser pursuant to this Agreement
required to be prepared and maintained by the Adviser or the Trust pursuant to
applicable law. To the
10
extent required by law, the books and records pertaining to the Trust which are
in possession of the Adviser shall be the property of the Trust. The Trust, or
its representatives, shall have access to such books and records at all times
during the Adviser's normal business hours. Upon the reasonable request of the
Trust, copies of any such books and records shall be provided promptly by the
Adviser to the Trust or its representatives.
(f) The Adviser will cooperate with the Fund's independent public
accountants and shall take reasonable action to make all necessary information
available to those accountants for the performance of the accountants' duties.
(g) The Adviser will provide the Fund's custodian and fund accountant on
each business day with such information relating to all transactions concerning
the Fund's assets as the custodian and fund accountant may reasonably require.
In accordance with the Procedures, the Adviser is responsible for assisting in
the fair valuation of all Fund assets using its reasonable efforts to arrange
for the provision of prices from parties who are not affiliated persons of the
Adviser for each asset for which a Fund's fund accountant does not obtain
prices in the ordinary course of business.
(h) The Adviser shall authorize and permit any of its directors, officers
and employees who may be duly elected as Trustees or officers of the Trust to
serve in the capacities in which they are elected.
(i) The Adviser shall have no duties or obligations pursuant to this
Agreement (other than the continuation of its preexisting duties and
obligations) during any period in which a Fund invests all (or substantially
all) of its investment assets in a registered, open-end management investment
company, or separate series thereof, in accordance with Section 12(d)(1)(E)
under the 1940 Act.
SECTION 4. COMPENSATION; EXPENSES
(a) In consideration of the foregoing, the Trust shall pay the Adviser, with
respect to the Fund, a fee at an annual rate as listed in Appendix A hereto.
Such fees shall be accrued by the Trust daily and shall be payable monthly in
arrears on the first business day of each calendar month for services performed
hereunder during the prior calendar month. If fees begin to accrue in the
middle of a month or if this Agreement terminates before the end of any month,
all fees for the period from that date to the end of that month or from the
beginning of that month to the date of termination, as the case may be, shall
be prorated according to the proportion that the period bears to the full month
in which the effectiveness or termination occurs. Upon the termination of this
Agreement with respect to a Fund, the Trust shall pay to the Adviser such
compensation as shall be payable prior to the effective date of termination.
(b) The Adviser shall reimburse expenses of the Fund or waive its fees to
the extent necessary to maintain a Fund's expense ratio at an agreed-upon
amount for a period of time specified in a separate letter of agreement. The
Adviser's reimbursement of a Fund's expenses shall be estimated and paid to the
Trust monthly in arrears, at the same time as the Trust's payment to the
Adviser for such month. In addition, the Adviser shall pay all operating
expenses of the Fund, including the compensation and expenses of any employees
of the Fund and of any other persons rendering any services to the Fund;
clerical and shareholder service staff salaries; office space and other office
expenses; fees and expenses incurred by the Fund in connection with membership
in investment company organizations; legal, auditing and accounting expenses;
expenses of registering shares under federal and state securities laws,
including expenses incurred by the Fund in connection with the organization and
initial registration of shares of the Fund; insurance expenses; fees and
expenses of the custodian, transfer agent, dividend disbursing agent,
shareholder service agent, plan agent, administrator, accounting and pricing
services agent and underwriter of the Fund; expenses, including clerical
expenses, of issue, sale, redemption or repurchase of shares of the Fund; the
cost of preparing and distributing reports and notices to shareholders, the
cost of printing or preparing prospectuses and statements of additional
information for delivery to the Fund's current and prospective shareholders;
the cost of printing or preparing stock certificates or any other documents,
statements or reports to shareholders; expenses of shareholders' meetings and
proxy solicitations; advertising, promotion and other expenses incurred
directly or indirectly in connection with the sale or distribution of the
Fund's shares excluding expenses which the Fund is authorized to pay pursuant
to Rule 12b-l under the 1940 Act; and all other operating expenses not
specifically assumed by the Fund.
11
(c) The Fund will pay all brokerage fees and commissions, taxes, borrowing
costs (such as (a) interest and (b) dividend expenses on securities sold
short), fees and expenses of the non-interested person trustees and such
extraordinary or non-recurring expenses as may arise, including litigation to
which the Fund may be a party and indemnification of the Trustees and officers
with respect thereto. The Fund will also pay any expenses which it is
authorized to pay pursuant to Rule 12b-1 under the 1940 Act. The Adviser may
obtain reimbursement from the Fund, at such time or times as the Adviser may
determine in its sole discretion, for any of the expenses advanced by it, which
the Fund is obligated to pay, and such reimbursement shall not be considered to
be part of the Adviser's compensation pursuant to this Agreement.
(d) No fee shall be payable hereunder with respect to a Fund during any
period in which the Fund invests all (or substantially all) of its investment
assets in a registered, open-end, management investment company, or separate
series thereof, in accordance with Section 12(d)(1)(E) under the 1940 Act.
SECTION 5. STANDARD OF CARE
(a) The Trust shall expect of the Adviser, and the Adviser will give the
Trust the benefit of, the Adviser's best judgment and efforts in rendering its
services to the Trust. The Adviser shall not be liable hereunder for mistake of
judgment or mistake of law or in any event whatsoever, except for lack of good
faith, provided that nothing herein shall be deemed to protect, or purport to
protect, the Adviser against any liability to the Trust or to the Trust's
security holders to which the Adviser would otherwise be subject by reason of
willful misfeasance, bad faith or gross negligence in the performance of the
Adviser's duties hereunder, or by reason of the Adviser's reckless disregard of
its obligations and duties hereunder.
(b) The Adviser shall not be responsible or liable for any failure or delay
in performance of its obligations under this Agreement arising out of or
caused, directly or indirectly, by circumstances beyond its reasonable control
including, without limitation, acts of civil or military authority, national
emergencies, labor difficulties (other than those related to the Adviser's
employees), fire, mechanical breakdowns, flood or catastrophe, acts of God,
insurrection, war, riots or failure of the mails, transportation, communication
or power supply.
SECTION 6. EFFECTIVENESS, DURATION AND TERMINATION
(a) This Agreement shall become effective with respect to a Fund on the date
above after approval by (1) a majority of the outstanding voting securities of
that Fund and (2) a majority of the Board who are not interested parties of the
Trust.
(b) This Agreement shall remain in effect with respect to a Fund for a
period of two years from the date of its effectiveness and shall continue in
effect for successive annual periods with respect to the Fund; provided that
such continuance is specifically approved at least annually: (i) by the Board
or by the vote of a majority of the outstanding voting securities of the Fund,
and, in either case; (ii) by a majority of the Trust's trustees who are not
parties to this Agreement or interested persons of any such party (other than
as trustees of the Trust); provided further, however, that if the continuation
of this Agreement is not approved as to a Fund, the Adviser may continue to
render to that Fund the services described herein in the manner and to the
extent permitted by the 1940 Act and the rules and regulations thereunder.
(c) This Agreement may be terminated with respect to a Fund at any time,
without the payment of any penalty: (i) by the Board or by a vote of a majority
of the outstanding voting securities of the Fund on 60 days' written notice to
the Adviser; or (ii) by the Adviser on 60 days' written notice to the Trust.
This Agreement shall terminate immediately upon its assignment.
12
SECTION 7. ACTIVITIES OF THE ADVISER
Except to the extent necessary to perform its obligations hereunder, nothing
herein shall be deemed to limit or restrict the Adviser's right, or the right
of any of the Adviser's directors, officers or employees to engage in any other
business or to devote time and attention to the management or other aspects of
any other business, whether of a similar or dissimilar nature, or to render
services of any kind to any other corporation, trust, firm, individual or
association.
SECTION 8. REPRESENTATIONS OF ADVISER.
The Adviser represents and warrants that: (i) it is either registered as an
investment adviser under the Investment Advisers Act of 1940, as amended
("Advisers Act") (and will continue to be so registered for so long as this
Agreement remains in effect) or exempt from registration under the Advisers
Act; (ii) is not prohibited by the 1940 Act or the Advisers Act from performing
the services contemplated by this 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
self-regulatory agency, necessary to be met in order to perform the services
contemplated by this Agreement; and (iv) will promptly notify the Trust 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.
SECTION 9. SUBADVISERS
At its own expense, the Adviser may carry out any of its obligations under
this Agreement by employing, subject to the direction and control of the Board,
one or more persons who are registered as investment advisers pursuant to the
Advisers Act or who are exempt from registration thereunder ("Subadvisers").
Each Subadviser's employment will be evidenced by a separate written agreement
approved by the Board and, if required, by the shareholders of the applicable
Fund. The Adviser shall not be liable hereunder for any act or omission of any
Subadviser, except to exercise good faith in the employment of the Subadviser
and except with respect to matters as to which the Adviser assumes
responsibility in writing.
SECTION 10. LIMITATION OF SHAREHOLDER AND TRUSTEE LIABILITY
The Trustees of the Trust and the shareholders of the Fund shall not be
liable for any obligations of the Trust or of any Fund under this Agreement,
and the Adviser agrees that, in asserting any rights or claims under this
Agreement, it shall look only to the assets and property of the Trust or Fund
to which the Adviser's rights or claims relate in settlement of such rights or
claims, and not to the Trustees of the Trust or the shareholders of any Fund.
SECTION 11. RIGHTS TO NAME
If the Adviser ceases to act as investment adviser to the Trust or any Fund
whose name includes the term "Golden" (the "Mark") or if the Adviser requests
in writing, the Trust shall take prompt action to change the name of the Trust
or any such Fund to a name that does not include the Mark. The Adviser may from
time to time make available without charge to the Trust for the Trust's use any
marks or symbols owned by the Adviser, including marks or symbols containing
the Mark or any variation thereof, as the Adviser deems appropriate. Upon the
Adviser's request in writing, the Trust shall cease to use any such mark or
symbol at any time. The Trust acknowledges that any rights in or to the Mark
and any such marks or symbols which may exist on the date of this Agreement or
arise hereafter are, and under any and all circumstances shall continue to be,
the sole property of the Adviser. The Adviser may permit other parties,
including other investment companies, to use the Mark in their names without
the consent of the Trust. The Trust shall not use the Mark in conducting any
business other than that of an investment company registered under the 1940 Act
without the permission of the Adviser.
13
SECTION 12. MISCELLANEOUS
(a) No provisions of this Agreement may be amended or modified in any manner
except by a written agreement properly authorized and executed by both parties
hereto and, if required by the 1940 Act, by a vote of a majority of the
outstanding voting securities of any Fund thereby affected.
(b) No amendment to this Agreement or the termination of this Agreement with
respect to a Fund shall affect this Agreement as it pertains to any other Fund,
nor shall any such amendment require the vote of the shareholders of any other
Fund.
(c) Neither party to this Agreement shall be liable to the other party for
consequential damages under any provision of this Agreement.
(d) This Agreement shall be governed by, and the provisions of this
Agreement shall be construed and interpreted under and in accordance with, the
laws of the State of New York.
(e) This Agreement constitutes the entire agreement between the parties
hereto and supersedes any prior agreement between those parties with respect to
the subject matter hereof, whether oral or written.
(f) This Agreement may be executed by the parties hereto on any number of
counterparts, and all of the counterparts taken together shall be deemed to
constitute one and the same instrument.
(g) If any part, term or provision of this Agreement is held to be illegal,
in conflict with any law or otherwise invalid, the remaining portion or
portions shall be considered severable and not be affected, and the rights and
obligations of the parties shall be construed and enforced as if the Agreement
did not contain the particular part, term or provision held to be illegal or
invalid.
(h) Section headings in this Agreement are included for convenience only and
are not to be used to construe or interpret this Agreement.
(i) Notices, requests, instructions and communications received by the
parties at their respective principal places of business, or at such other
address as a party may have designated in writing, shall be deemed to have been
properly given.
(j) Notwithstanding any other provision of this Agreement, the parties agree
that the assets and liabilities of the Fund of the Trust are separate and
distinct from the assets and liabilities of each other Fund and that no Fund
shall be liable or shall be charged for any debt, obligation or liability of
any other Fund, whether arising under this Agreement or otherwise.
(k) No affiliated person, employee, agent, director, officer or manager of
the Adviser shall be liable at law or in equity for the Adviser's obligations
under this Agreement.
(l) The terms "vote of a majority of the outstanding voting securities",
"interested person", "affiliated person," "control" and "assignment" shall have
the meanings ascribed thereto in the 1940 Act.
(m) Each of the undersigned warrants and represents that they have full
power and authority to sign this Agreement on behalf of the party indicated and
that their signature will bind the party indicated to the terms hereof and each
party hereto warrants and represents that this Agreement, when executed and
delivered, will constitute a legal, valid and binding obligation of the party,
enforceable against the party in accordance with its terms, subject to
bankruptcy, insolvency, reorganization, moratorium and other laws of general
application affecting the rights and remedies of creditors and secured parties.
14
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed all as of the day and year first above written.
FORUM FUNDS
------------------------------
Simon D. Collier
President
GOLDEN CAPITAL MANAGEMENT, LLC
------------------------------
Greg W. Golden
President and CEO
15
FORUM FUNDS
INVESTMENT ADVISORY AGREEMENT
Appendix A
FEE AS A % OF THE ANNUAL
FUNDS OF THE TRUST AVERAGE DAILY NET ASSETS OF THE FUND
------------------ ------------------------------------
Golden Large Core Value Fund 0.70%
Golden Small Core Value Fund 1.10%
FORUM FUNDS
TWO PORTLAND SQUARE
PORTLAND, MAINE 04101
PROXY
(FOR SHAREHOLDERS OF GOLDEN LARGE CORE VALUE FUND ONLY)
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF TRUSTEES
Revoking any such prior appointments, the undersigned appoints David M.
Whitaker, Leslie K. Klenk and Edward C. Lawrence (or, if only one shall act,
that one) proxies with the power of substitution to vote all of the shares of
Golden Large Core Value Fund (the "Fund"), a series of Forum Funds (the
"Trust"), registered in the name of the undersigned at the Special Meeting of
Shareholders of the Fund to be held at the offices of Citigroup Fund Services,
LLC, Two Portland Square, Fourth Floor, Portland, Maine 04101, on February 24,
2006, at 2:00 p.m. (Eastern time), and at any postponements or adjournments
thereof.
The shares of beneficial interest represented by this Proxy will be voted in
accordance with the instructions given by the undersigned below. IF NO CHOICE IS
SPECIFIED ON THE PROXY, PROPERLY EXECUTED PROXIES THAT ARE RETURNED IN TIME TO
BE VOTED AT THE MEETING WILL BE VOTED "FOR" THE APPROVAL OF THE PROPOSAL SET
FORTH BELOW. The Trust has proposed this Proposal. The Board of Trustees
recommends voting "FOR" the Proposal.
PROPOSAL
To approve the new investment advisory agreement between the
Trust and Golden Capital Management, LLC with respect to
Golden Large Core Value Fund.
FOR _____ AGAINST _____ ABSTAIN _____
(NOTE: Checking the box labeled "Abstain" will result in the shares covered by
the Proxy being treated as if they were voted "Against" a Proposal.) Receipt is
acknowledged of the Notice and Proxy Statement for the Special Meeting of
Shareholders to be held on February 24, 2006. PLEASE SIGN AND DATE THIS PROXY IN
THE SPACE PROVIDED AND RETURN IT PROMPTLY IN THE POSTAGE-PAID ENVELOPE PROVIDED.
Execution by shareholders who are not individuals must be made by an authorized
signatory. Executors, administrators, trustees, guardians and others signing in
a representative capacity should give their full title as such.
--------------------------------------------------------- -------------
Authorized Signature Date
---------------------------------------------------------
Printed Name (and Title if Applicable)
--------------------------------------------------------- -------------
Authorized Signature (Joint Investor or Second Signatory) Date
---------------------------------------------------------
Printed Name (and Title if Applicable)
FORUM FUNDS
TWO PORTLAND SQUARE
PORTLAND, MAINE 04101
PROXY
(FOR SHAREHOLDERS OF GOLDEN SMALL CORE VALUE FUND ONLY)
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF TRUSTEES
Revoking any such prior appointments, the undersigned appoints David M.
Whitaker, Leslie K. Klenk and Edward C. Lawrence (or, if only one shall act,
that one) proxies with the power of substitution to vote all of the shares of
Golden Small Core Value Fund (the "Fund"), a series of Forum Funds (the
"Trust"), registered in the name of the undersigned at the Special Meeting of
Shareholders of the Fund to be held at the offices of Citigroup Fund Services,
LLC, Two Portland Square, Fourth Floor, Portland, Maine 04101, on February 24,
2006, at 2:00 p.m. (Eastern time), and at any postponements or adjournments
thereof.
The shares of beneficial interest represented by this Proxy will be voted in
accordance with the instructions given by the undersigned below. IF NO CHOICE IS
SPECIFIED ON THE PROXY, PROPERLY EXECUTED PROXIES THAT ARE RETURNED IN TIME TO
BE VOTED AT THE MEETING WILL BE VOTED "FOR" THE APPROVAL OF THE PROPOSAL SET
FORTH BELOW. The Trust has proposed this Proposal. The Board of Trustees
recommends voting "FOR" the Proposal.
PROPOSAL
To approve the new investment advisory agreement between the
Trust and Golden Capital Management, LLC with respect to
Golden Small Core Value Fund.
FOR _____ AGAINST _____ ABSTAIN _____
(NOTE: Checking the box labeled "Abstain" will result in the shares covered by
the Proxy being treated as if they were voted "Against" a Proposal.) Receipt is
acknowledged of the Notice and Proxy Statement for the Special Meeting of
Shareholders to be held on February 24, 2006. PLEASE SIGN AND DATE THIS PROXY IN
THE SPACE PROVIDED AND RETURN IT PROMPTLY IN THE POSTAGE-PAID ENVELOPE PROVIDED.
Execution by shareholders who are not individuals must be made by an authorized
signatory. Executors, administrators, trustees, guardians and others signing in
a representative capacity should give their full title as such.
--------------------------------------------------------- -------------
Authorized Signature Date
---------------------------------------------------------
Printed Name (and Title if Applicable)
--------------------------------------------------------- -------------
Authorized Signature (Joint Investor or Second Signatory) Date
---------------------------------------------------------
Printed Name (and Title if Applicable)