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Name | Symbol | Market | Type |
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Catalystaspect Enhanced Multiasset Fund Class A | NASDAQ:CASAX | NASDAQ | Fund |
Price Change | % Change | Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Traded | Last Trade | |
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0.00 | 0.00% | 0 | - |
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 14C
INFORMATION STATEMENT PURSUANT TO SECTION 14(c)
OF THE SECURITIES EXCHANGE ACT OF 1934 (AMENDMENT NO. )
Check the appropriate box:
þ Preliminary Information Statement
¨ Confidential, for Use of the Commission Only (as permitted by Rule 14c-5(d)(2))
¨ Definitive Information Statement
Columbia Funds Series Trust I
(Name of Registrant As Specified In Its Charter)
Payment of Filing Fee (Check the appropriate box):
þ | No fee required | |
¨ | Fee computed on table below per Exchange Act Rules 14c-5(g) and 0-11 | |
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Title of each class of securities to which transaction applies:
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Aggregate number of securities to which transaction applies:
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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):
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Proposed maximum aggregate value of transaction:
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Total fee paid:
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Fee paid previously with preliminary materials. |
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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. |
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Amount Previously Paid:
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Form, Schedule or Registration Statement No.:
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Filing Party:
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Date Filed:
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ACTIVE PORTFOLIOS ® MULTI-MANAGER CORE PLUS BOND FUND
225 Franklin Street
Boston, MA02110
INFORMATION STATEMENT
NOTICE REGARDING SUBADVISER
This information statement mailed on or about , 2013, is being provided to the shareholders of Active Portfolios ® Multi-Manager Core Plus Bond Fund (the Fund), a series of Columbia Funds Series Trust I (the Trust), in lieu of a proxy statement, pursuant to the terms of an exemptive order that the Fund received from the Securities and Exchange Commission (the SEC). This exemptive order permits Columbia Management Investment Advisers, LLC (Columbia Management or the Investment Manager), subject to approval of the Funds Board of Trustees (the Board), to retain a subadviser (or subadvisers) which Columbia Management believes is (are) best suited to achieve the Funds investment objective.
This Information Statement Is For Informational Purposes Only And No Action Is Requested On Your Part. We Are Not Asking You For A Proxy And You Are Requested Not To Send Us A Proxy.
THE FUND AND ITS MANAGEMENT AGREEMENT
Columbia Management, located at 225 Franklin Street, Boston, MA 02110, serves as investment manager to the Fund pursuant to an Investment Management Services Agreement (the IMS Agreement) dated May 1, 2010, as amended March 14, 2012. Columbia Management and two subadvisers each manage a portion of the Funds assets, or sleeve of the Fund. Under the IMS Agreement, Columbia Management monitors the performance of subadvisers on an ongoing basis. Factors it considers with respect to the selection and retention of a subadviser are, among others: the qualifications of the subadvisers investment personnel, its investment philosophy and process, its compliance program, and its long-term performance results (the Subadviser Factors). As compensation for its services, Columbia Management receives a management fee from the Fund and, from this management fee, Columbia Management pays the subadviser a subadvisory fee.
Subadvisers serve pursuant to separate subadvisory agreements with Columbia Management (each a Subadvisory Agreement) under which the subadviser manages all or a portion of a funds investment portfolio, as allocated to the subadviser by Columbia Management, and provides related compliance and record-keeping services. In accordance with procedures adopted by the Board, affiliated broker-dealers of the subadviser may execute portfolio transactions for a subadvised fund and receive brokerage commissions in connection with those transactions as permitted by Rule 17e-1 under the Investment Company Act of 1940, as amended (the 1940 Act), or separate SEC exemptive relief. A subadviser is allowed to use soft dollar arrangements in which it directs brokerage commissions to brokers to pay for research services, provided that the subadvisers procedures are consistent with Fund and Columbia Managements policies.
TCW INVESTMENT MANAGEMENT COMPANY AND THE NEW SUBADVISORY AGREEMENT
At a meeting of the Board on December 4, 2012, the Board, including a majority of the Board members who are not interested persons of the Fund within the meaning of the 1940 Act (the Independent Trustees), approved the recommendation of Columbia Management to approve a new subadvisory agreement (the New Subadvisory Agreement) with TCW Investment Management Company (TCW), an indirect majority-owned subsidiary of Societe Generale Holding de Participations (SoGen), in connection with the announcement that SoGen agreed to sell its interest in TCW to Clipper Acquisitions Corp., a controlled affiliate of certain investment funds affiliated with The Carlyle Group L.P. (Carlyle) (the Transaction) to be effective following the closing of the Transaction. The Transaction would result in a change of control of TCW under the 1940 Act, and the automatic termination of the previous subadvisory agreement (the Previous Subadvisory Agreement) between Columbia Management and TCW. The Transaction closed on February 6, 2013. The New Subadvisory Agreement was effective as of February 6, 2013. The New Subadvisory Agreement is materially identical to the Previous Agreement, including fees.
IMS Fees Paid to Columbia and Subadvisory Fees Paid to TCW
Under the IMS Agreement, the Fund pays Columbia Management a fee as follows:
Active Portfolios Multi-Manager Core Plus Bond Fund Assets (billions) |
Annual rate at each asset level | |||
First $1.0 |
0.430 | % | ||
Next$1.0 |
0.420 | % | ||
Next $4.0 |
0.400 | % | ||
Next $1.5 |
0.380 | % | ||
Next $2.5 |
0.365 | % | ||
Next $3.0 |
0.360 | % | ||
Next $8.0 |
0.350 | % | ||
Next $4.0 |
0.340 | % | ||
Next $26.0 |
0.320 | % | ||
Over $50.0 |
0.300 | % |
The table above represents the fee rate paid by the Fund to Columbia Management, which will not change as a result of this Transaction. Columbia Management, in turn, pays TCW a fee out of its own assets, calculated at the following rates:
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0.18% on the first $500 million, reducing to 0.05% as assets increase |
Fees paid by the
Fund to Columbia Management for the period from April 25, 2012* to February 6, 2013 |
Fees paid by
Columbia Management to TCW for the period from April 25, 2012* to February 6, 2013 |
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Active Portfolios ® Multi-Manager Core Plus Bond Fund |
$ | 15,044,001.20 | ** | $ | 1,399,647.02 |
* | Fund inception. |
** | Columbia Management uses these fees to pay the subadviser. |
INFORMATION ABOUT TCW
TCW is wholly-owned by The TCW Group, Inc. As of February 28, 2013, TCW had approximately $31,819,349,257.00 in assets under management. TCWs principal offices are located at 865 S. Figueroa St., Suite 1800, Los Angeles, CA 90017.
The following table provides information on the principal executive officers and directors of TCW.
Name |
Title/Responsibilities |
Address |
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David Brian Lippman | Director, President, Chief Executive Officer |
865 S. Figueroa St., Suite 1800, Los Angeles, CA 90017 |
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Marc Irwin Stern | Director, Chairman |
865 S. Figueroa St., Suite 1800, Los Angeles, CA 90017 |
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David Stephen Devito | Director, Executive Vice President, Chief Administrative Officer |
865 S. Figueroa St., Suite 1800, Los Angeles, CA 90017 |
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Hillary Gillian Darcy Lord | Chief Compliance Officer |
865 S. Figueroa St., Suite 1800, Los Angeles, CA 90017 |
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Joseph Michael Burschinger | Executive Vice President, Chief Risk Officer |
865 S. Figueroa St., Suite 1800, Los Angeles, CA 90017 |
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Richard Manuel Villa | Chief Financial Officer |
865 S. Figueroa St., Suite 1800, Los Angeles, CA 90017 |
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Meredith Jackson | Executive Vice President, General Counsel, Secretary |
865 S. Figueroa St., Suite 1800, Los Angeles, CA 90017 |
Other Funds with Similar Investment Objectives Managed by TCW
Name |
Assets as of
February 28, 2013 |
Management
Fee |
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TCW Core Fixed Income Fund |
$ | 1,115,586,233.00 | 0.40 | % |
Board Consideration and Approval of Subadvisory Agreement
On December 4, 2012, the Board and the Independent Trustees who are not interested persons of the Trust unanimously approved, for an initial one-year term, the New Subadvisory Agreement between Columbia Management and TCW with respect to the Fund, a series of the Trust. As detailed below, the Board and certain of its committees met on multiple occasions to review and discuss, both among themselves and with the management team of Columbia Management, materials provided by Columbia Management before determining to approve the New Subadvisory Agreement.
In connection with their deliberations regarding the proposed New Subadvisory Agreement, the Product and Distribution Committee (the Committee) and the Board evaluated materials requested from Columbia Management and TCW regarding the Fund and the New Subadvisory Agreement, and discussed these materials with representatives of Columbia Management at the Committee meeting held on December 3, 2012 and at the Board meeting held on December 4, 2012. As part of these deliberations, the Committee and the Board considered the ability of Columbia Management, subject to the approval of the Board, to modify or enter into new subadvisory agreements without a shareholder vote pursuant to an exemptive order of the Securities and Exchange Commission. The Committee and the Board noted that at the December 3, 2012 Committee meeting, Columbia Management recommended that the Board approve a new subadvisory agreement with TCW in connection with a change in control of TCW that would result in the termination of the Previous Subadvisory Agreement between Columbia Management and TCW. The Committee and the Board also noted the prior considerations of the Board and the Advisory Fees and Expenses Committee (the Fees Committee) at meetings held in connection with the initial review and approval of the Previous Subadvisory Agreement and the IMS Agreement with Columbia Management with respect to the Fund, on March 6, 2012 and March 7, 2012.
In connection with their review and approval of the IMS Agreement, the Previous Subadvisory Agreement, and the New Subadvisory Agreement, the Board and its committees also consulted with Fund counsel and with the Independent Trustees independent legal counsel, who advised on various matters with respect to the Boards and the committees considerations and otherwise assisted the Board and its committees in their deliberations. On December 3, 2012, the Committee recommended that the Board approve the New Subadvisory Agreement. On December 4, 2012, the Board, including the Independent Trustees, voting separately, unanimously approved the New Subadvisory Agreement for the Fund.
The Committee and the Board considered all information that they, their legal counsel, or Columbia Management believed reasonably necessary to evaluate and to determine whether to approve the Subadvisory Agreement. In their deliberations, the Trustees did not identify any particular information that was all-important or controlling, and individual Trustees may have attributed different weights to the various factors. The information and factors considered by the Committee and the Board in recommending for approval or approving the New Subadvisory Agreement for the Fund included the following:
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The terms and conditions of the New Subadvisory Agreement, including that the terms of the New Subadvisory Agreement were identical to those of the Previous Subadvisory Agreement; |
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Information regarding the reputation, regulatory history and resources of TCW, including information regarding senior management, portfolio managers and other personnel of TCW; |
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Information regarding the capabilities of Columbia Management and TCW with respect to compliance monitoring services, including an assessment of Columbia Managements and TCWs compliance system by the Funds Chief Compliance Officer; |
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The subadvisory fees to be charged to Columbia Management under the New Subadvisory Agreement, including the fact that the fees under the New Subadvisory Agreement would be identical to those charged to Columbia Management under the Previous Subadvisory Agreement; |
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Columbia Managements agreement to contractually limit or cap total operating expenses for the Fund so that total operating expenses (excluding certain fees and expenses, such as transaction costs and certain other investment related expenses, interest, taxes, acquired fund fees and expenses, and extraordinary expenses) would not exceed the median expenses of a group of comparable funds (as determined from time to time, generally annually, by an independent third-party data provider); and |
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Descriptions of various functions performed by TCW under the New Subadvisory Agreement, including portfolio management and portfolio trading practices. |
Nature, Extent and Quality of Services to be Provided under the Subadvisory Agreement
The Committee and the Board considered the nature, extent and quality of services to be provided to the Fund by TCW under the New Subadvisory Agreement, and the resources dedicated to the Fund by TCW in view of the change of control of TCW. The Committee and the Board considered, among other things, TCWs ability to attract, motivate and retain highly qualified research, advisory and supervisory investment professionals (including personnel and other resources, reputation and other attributes), the portfolio management services provided by those investment professionals, and the quality of TCWs investment research capabilities.
The Committee and the Board also considered the professional experience and qualifications of the senior personnel of TCW after the change of control of TCW. The Committee and the Board also considered that the change in control of TCW was expected to benefit the Fund by addressing uncertainty regarding the ownership of TCW. After reviewing these and related factors, the Committee and the Board concluded, within the context of their overall conclusions, that the expected nature, extent and quality of the services to be provided to the Fund under the New Subadvisory Agreement supported the approval of the New Subadvisory Agreement.
Subadvisory Fee Rates and Other Expenses
The Committee and the Board considered the subadvisory fees to be charged to Columbia Management under the New Subadvisory Agreement, as well as the total expenses to be incurred by the Fund under the IMS Agreement with Columbia Management. In assessing the reasonableness of the proposed fees under the New Subadvisory Agreement, the Committee and the Board considered, among other information, the proposed subadvisory fees and noted that the subadvisory fees charged to Columbia Management under the New Subadvisory Agreement would be identical to those charged to Columbia Management under the Previous Subadvisory Agreement.
After reviewing these and related factors, the Committee and the Board concluded, within the context of their overall conclusions, that the subadvisory fee rates and expenses to be charged to Columbia Management supported the approval of the New Subadvisory Agreement.
Costs of Services to be Provided and Profitability
The Committee and the Board noted that in connection with the initial review and approval of the IMS Agreement, the Fees Committee and the Board had considered information provided by Columbia Management with respect to estimated costs of services and profitability, and expected to consider the costs of services and the profitability of Columbia Management and its affiliates in connection with the Fees Committees and the Boards next review and consideration of the continuation of the IMS Agreement. The Fees Committee and the Board also considered court cases in which adviser profitability was an issue in whole or in part, the performance of the Fund, the expense ratio of the Fund, and the implementation of expense limitations with respect to the Fund. Because the New Subadvisory Agreement was negotiated at arms-length by Columbia Management, which is responsible for payments to TCW thereunder, the Fees Committee and the Board did not consider the profitability to TCW of its relationship with the Fund.
After reviewing these and related factors, the Committee and the Board concluded, within the context of their overall conclusions, that the anticipated costs of services to be provided and the expected profitability to Columbia Management and its affiliates from their relationships with the Fund supported the approval of the New Subadvisory Agreement.
Investment Performance
Because the Fund did not have operating results for a full fiscal year, the Board did not have investment performance to compare to the returns of a peer group and a universe of comparable funds. However, the Board expected to consider, in connection with their next review and consideration of the continuation of the New Subadvisory Agreement, the investment performance of the Fund in relation to the annualized return of a benchmark and a group of comparable funds, as determined by an independent third party data provider.
The Committee and the Board also considered TCWs performance and reputation generally. After reviewing these and related factors, the Committee and the Board concluded, within the context of their overall conclusions, that the anticipated performance of the Fund supported approval of the New Subadvisory Agreement.
Economies of Scale
The Committee and the Board noted that in connection with the initial review and approval of the IMS Agreement and the Previous Subadvisory Agreement, consideration had been given to the potential existence of economies of scale in the provision by Columbia Management and TCW of services to the Fund, to groups of related funds, and to Columbia Managements and TCWs investment advisory clients as a whole, and whether those economies of scale were expected to be shared with the Fund through breakpoints in the proposed investment advisory fees or other means, such as expense limitation arrangements and additional investments by Columbia Management and/or TCW in investment, trading and compliance resources. The Committee and the Board noted that the investment advisory fee schedules for the Fund, which contained breakpoints that would reduce the fee rate on assets above specified threshold levels, were not changing in connection with the approval of the New Subadvisory Agreement.
The Committee and the Board noted that the breakpoints in the IMS Agreement did not occur at the same levels as the breakpoints in the New Subadvisory Agreement. The Committee and the Board noted that the fees charged Columbia Management under the New Subadvisory Agreement would be identical to those charged under the Previous Subadvisory Agreement, and that absent a shareholder vote to approve new fees, Columbia Management would bear any increase in fees payable under the New Subadvisory Agreement. The Committee and the Board also noted that in connection with the initial review and approval of the IMS Agreement and the Previous Subadvisory Agreement, the Fees Committee and the Board had considered the potential challenges of seeking to tailor the IMS Agreement breakpoints to those of a subadvisory agreement in this context, and the effect that capacity constraints on each subadvisers ability to manage assets might have on the ability of Columbia Management to achieve economies of scale, as new subadvisers might need to be added as the Fund grows, increasing Columbia Managements cost of compensating and overseeing the Funds subadvisers.
After reviewing these and related factors, the Committee and the Board concluded, within the context of their overall conclusions, that the extent to which economies of scale were expected to be shared with the Fund supported the approval of the New Subadvisory Agreement.
Other Benefits to the Investment Manager
The Committee and the Board noted that in connection with the proposed New Subadvisory Agreement, there would be no additional impact to the fall-out or ancillary benefits to be received by Columbia Management and its affiliates or to TCW as a result of their relationships with the Fund, beyond those currently enjoyed or available in connection with the Previous Subadvisory Agreement.
Conclusion
The Committee and the Board reviewed all of the above considerations in reaching their decisions to recommend or approve the proposed New Subadvisory Agreement. Based on their evaluation of all factors that they deemed to be material, including those factors described above, and assisted by the advice of independent legal counsel, the Board, including the Independent Trustees, voting separately, unanimously approved the New Subadvisory Agreement.
Fund Assets
For a mutual fund managed by multiple subadvisers, such as the Fund, Columbia Management, subject to the oversight of the Board, decides the proportion of Fund assets to be managed by each subadviser, and may change these proportions at any time. As of February 6, 2013, the Funds assets were managed as follows:
Columbia Management |
Federated Investment
Management Company |
TCW | ||
35.7% | 33.5% | 30.8% |
ADDITIONAL INFORMATION ABOUT THE FUND
In addition to acting as the Funds investment manager, Columbia Management and its affiliates also receive compensation for providing other services to the Fund.
Administrator
Columbia Management serves as the administrator of the Fund.
Principal Underwriter
Columbia Management Investment Distributors, Inc., located at 225 Franklin Street, Boston, MA 02110, serves as the principal underwriter and distributor of the Fund.
Transfer Agent
Columbia Management Investment Services Corp., located at 225 Franklin Street, Boston, MA 02110, serves as the transfer agent of the Fund.
FINANCIAL INFORMATION
The Funds most recent annual or semiannual report is available on request, without charge, by contacting your financial intermediary, writing to Columbia Funds c/o Columbia Management Investment Services Corp., P.O. Box 8081, Boston, MA 02266-8081 or calling 800.345.6611.
RECORD OF BENEFICIAL OWNERSHIP
For the Fund, as of February 28, 2013, American Enterprise Investment Services held 100% of the Funds Class A shares.
As of February 28, 2013, Board members and officers of the Fund as a group owned less than 1% of the outstanding shares of the Fund.
SHAREHOLDER PROPOSALS
The Fund is not required to hold regular meetings of shareholders each year. Meetings of shareholders are held from time to time and shareholder proposals intended to be presented at future meetings must be submitted in writing to the Fund in reasonable time prior to the solicitation of proxies for the meeting.
S- (_/13)
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