Policy
Oberweis Asset Management, Inc. (the “Adviser”) acts
as discretionary investment adviser to various clients,
including The Oberweis Funds (the “Fund”). The Adviser
will not exercise voting authority with respect to
client securities, unless a client has authorized the
Adviser to exercise such discretion pursuant to the
client’s advisory contract with the Adviser. The Adviser
will exercise voting authority with respect to
securities held by the Fund.
The Adviser’s policy is to vote proxies in the best
economic interests of clients. The principles which
guide the voting policy of the Adviser are maximizing
the value of client assets and promoting the rights of
clients as beneficial owners of the companies in whose
securities they invest. The Adviser’s investment
strategies are predicated on the belief that the quality
of management is often the key to ultimate success or
failure of a business. Because the Adviser generally
makes investments in companies in which the Adviser has
confidence in the management, proxies generally are
voted in accord with management’s recommendation. The
Adviser may vote a proxy in a manner contrary to
management’s recommendation if, in the judgment of the
Adviser, the proposal would not enhance shareholder
value.
The Adviser has retained Institutional Shareholder
Services (“ISS”), a proxy voting and consulting firm, to
receive proxy voting statements, provide information and
research, make proxy vote recommendations, and handle
various administrative functions associated with the
voting of client proxies. The proxy voting guidelines
for U.S. proxies are set forth in the ISS Proxy Voting
Guidelines Summary and for non-U.S. proxies, the ISS
International Proxy Voting Guidelines, copies of which
are attached, and the ISS Proxy Voting Manual. In
addition, ISS has country and market specific policies.
The Summaries are a condensed version of all proxy
voting recommendations contained in the ISS Proxy Voting
Manual. While ISS makes the proxy voting
recommendations, the Adviser retains the ultimate
authority on how to vote. In general, based on its
review of ISS’ proxy voting recommendations, it is
anticipated that the Adviser will be in agreement with
ISS recommendations and no other action will be required
by the Adviser.
Procedures
Eric V. Hannemann, Secretary, is responsible for
monitoring corporate actions. Eric V. Hannemann,
Secretary, is also responsible for ensuring that all
proxies are voted in a timely manner and, except where a
conflict exists, are voted consistently across client
accounts.
Eric V. Hannemann, Secretary, is responsible for
monitoring for conflicts of interest between the Adviser
(and/or its affiliated persons) and its clients,
including the Fund and its shareholders. Such a conflict
may arise, for example, when the Adviser has a business
relationship with (or is actively soliciting business
from) the company soliciting proxies or a third party
that has a material interest in the outcome of a proxy
vote or that is actively lobbying for a particular
outcome of a proxy vote. All employees are responsible
for notifying Eric V. Hannemann, Secretary, with respect
to any conflict of interest of which they become aware.
Upon receipt of proxy statements on behalf of the
Adviser’s clients, ISS will vote the proxies in
accordance with its recommendations and no action is
required by the Adviser unless it disagrees with ISS’
recommendation. If the Adviser disagrees with ISS’ vote
recommendation, it will override the vote and
communicate to ISS how to mark and process the vote. In
such case, James W. Oberweis, President, or other
officer of the Adviser as designated by James W.
Oberweis, will vote the proxy.
The following matters will be referred to the Adviser’s
Proxy Committee for instructions: (1) matters where ISS
indicates that the application of the recommendations is
unclear; (2) matters which ISS indicates are not covered
by the recommendations; (3) any other unique matters
that may require review by the committee, and (4) if
applicable as described under “Conflicts of Interest”
below, matters where there is a potential or actual
conflict of interest. The Proxy Committee will formulate
a recommendation on such matters in accordance with the
Adviser’s goal to maximize the value of client assets.
The Proxy Committee will provide voting instructions on
such matters to James W. Oberweis, President, who will
vote in accordance with those instructions. The members
of the Proxy Committee are identified on Schedule A,
which may be amended from time to time.
Guidelines
Foreign Securities
OAM will use its best efforts to vote “foreign security
proxies” consistent with its policy stated above, but
will not vote a foreign proxy:
- if the cost of voting a foreign proxy outweighs the
benefit of voting the foreign proxy;
- when OAM has not been given enough time to process the
vote; or
- when a sell order for the foreign security is
outstanding and, in the particular foreign country,
proxy voting would impede the sale of the foreign
security (“share blocking”).
Loaned Securities
Unless otherwise required, if an OAM client has
determined to participate in a securities lending
program, OAM will not seek recalls for the purpose of
voting proxies for the securities on loan..
Conflicts of Interest
If the Adviser determines that, through reasonable
inquiry or otherwise, an issue raises a potential
material conflict of interest, the Adviser will follow
the recommendations of ISS except as follows. If the
Adviser and/or the Proxy Committee believes that it
would be in the interest of the Adviser’s clients to
vote a proxy other than according to the recommendation
of ISS, the Proxy Committee will prepare a report that
(1) describes the conflict of interest; (2) discusses
procedures used to address such conflict of interest;
and (3) confirms that the recommendation was made solely
on the investment merits and without regard to any other
consideration.
In any event, the Adviser will report to the Board of
the Fund regarding any conflicts of interest with
respect to the Fund, including how the conflict was
resolved, at the next regularly scheduled Board meeting.
Recordkeeping
General
The Adviser will maintain the following records:
- these Policies and Procedures, including any
amendments;
- proxy statements received regarding client
securities (provided, however, that the Adviser may
rely on the Securities and Exchange Commission's
(the "SEC") EDGAR system if the company
filed its proxy statements via EDGAR or may rely on
ISS;
- a record of each vote cast on behalf of a client
(provided, however, that the Adviser may rely on ISS;)
- a copy of any document prepared by the Adviser
that was material to making a voting decision or
that memorialized the basis for the decision; and
- a copy of each written client request for
information on how the Adviser voted proxies on
behalf of that client and the Adviser's written
response to any client request (whether written or
oral) on how the Adviser voted proxies on behalf of
that client.
The Adviser will maintain these records in an easily
accessible place for at least five years from the end of
the fiscal year during which the last entry was made on
such record, the first two years in an appropriate
office of the Adviser.
The Fund
With respect to proxies voted on behalf of the Fund,
the Adviser will coordinate with ISS to compile for each
portfolio of the Fund for each matter with respect to
which the portfolio was entitled to vote, the
information required to be included in Form N PX for
each 12 month period ending June 30 in order to assist
the Fund in filing Form N PX with the SEC by August 31
of each year.
Disclosure
The Adviser will describe in Part II of its Form ADV
these Policies and Procedures and indicate that these
Policies and Procedures are available to clients upon
request. The Adviser will also advise clients in Part II
of its Form ADV how a client may obtain information on
how the Adviser voted with respect to that client’s
securities.
- Patrick B. Joyce
- James W. Oberweis
- Martin L. Yokosawa
These Policies and Procedures may be amended by
the Adviser from time to time. However, such amendments
must be reported to the Board of the Fund at the next
regularly scheduled Board meeting.
Dated August 1, 2003, as amended May 20, 2004 and
further amended January 27, 2005 and November 1, 2005
and January 10, 2007.
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