Proxy Information

MERIDIAN FUND, INC.

PROXY AND CORPORATE ACTION VOTING
POLICIES AND PROCEDURES
October 2017

  1. I.                Policy

 

ArrowMark Colorado Holdings (“ArrowMark” or “Adviser”) acts as discretionary investment adviser for various clients, which may include clients governed by the Employee Retirement Income Security Act of 1974 (“ERISA”) and registered open-end investment companies (“Mutual Funds”).    ArrowMark’s authority to vote proxies or act on other shareholder actions is established under the delegation of discretionary authority under its investment advisory contracts. 

It is the policy of ArrowMark to vote proxies in the best interest of its clients.  Proxies are an asset of a client, which should be treated with the same care, diligence, and loyalty as any asset belonging to a client.  To that end, ArrowMark will vote in a way that it believes, consistent with its fiduciary duty, will cause the value of the issue to increase the most or decline the least.  Consideration will be given to both the short and long term implications of the proposal to be voted on when considering the optimal vote. 

 

Delegation of Duties

To assist the Adviser in executing its responsibilities, the Adviser has engaged a third party proxy voting specialist, Glass Lewis & Co., LLC (“Glass Lewis” or the “Proxy Manager”).  The services provided by Glass Lewis include in-depth research and voting recommendations intended to create shareholder value.

 

The Adviser has reviewed the Proxy Manager’s Guidelines, and has determined that such Guidelines are consistent with the Adviser’s fiduciary responsibilities with respect to its clients.  The Adviser will review any material amendments to such Guidelines.

 

Any general or specific proxy voting guidelines provided by an advisory client or its designated agent in writing will supersede this policy. 

 

III.            Procedures for Identification and Voting of Proxies

The Proxy Manager is responsible for ensuring that all proxies received are voted in a timely manner and voted consistently across all portfolios. Although many proxy proposals can be voted in accordance with the Proxy Manager’s established guidelines (the “Guidelines”), ArrowMark retains the right to vote any proposal in a manner differing from the Guidelines.  Such deviations from the Guidelines must be approved by the CCO with a written explanation of the rationale for the deviation.

ArrowMark, in conjunction with the custodian, is responsible for ensuring that all corporate actions received are addressed in a timely manner and consistent action is taken across all portfolios.

ArrowMark’s authority to vote proxies or act with respect to other corporate actions is established through the delegation of discretionary authority under its investment advisory agreements. Therefore, unless a Client specifically reserves the right, in writing, to vote its own proxies or to take shareholder action with respect to other corporate actions requiring shareholder actions, ArrowMark will vote all proxies and act on all other actions in a timely manner as part of its full discretionary authority over Clients in accordance with established policies and procedures.  

 

 

 

Conflicts of Interest

ArrowMark is responsible for monitoring situations where the voting of proxies may present actual or perceived conflicts of interest between the Adviser and clients.

 

The following is a non-exhaustive list of potential conflicts of interests that could influence the proxy voting process:

 

  • Conflict: ArrowMark retains an institutional client, or is in the process of retaining an institutional client that is affiliated with an issuer that is held in ArrowMark’s client portfolios.  For example, ArrowMark may be retained to manage Company A’s pension fund.  Company A is a public company and ArrowMark client accounts hold shares of Company A.  This type of relationship may influence ArrowMark to vote with management on proxies to gain favor with management.  Such favor may influence Company A’s decision to continue its advisory relationship with ArrowMark.

 

  • Conflict: ArrowMark retains a client, or is in the process of retaining a client that is an officer or director of an issuer that is held in ArrowMark’s client portfolios.  The similar conflicts of interest exist in this relationship as discussed above.

 

  • Conflict: ArrowMark’s Employees maintain a personal and/or business relationship (not an advisory relationship) with issuers or individuals that serve as officers or directors of issuers.  For example, the spouse of an Employee may be a high-level executive of an issuer that is held in ArrowMark’s client portfolios.  The spouse could attempt to influence ArrowMark to vote in favor of management.

 

  • Conflict:  ArrowMark or an Employee(s) personally owns a significant number of an issuer’s securities that are also held in ArrowMark’s client portfolios.  For any number of reasons, an Employee(s) may seek to vote proxies in a different direction for his/her personal holdings than would otherwise be warranted by the proxy voting policy.  The Employee(s) could oppose voting the proxies according to the policy and successfully influence ArrowMark to vote proxies in contradiction to the policy. 

 

  • Conflict:  ArrowMark or its affiliate has a financial interest in the outcome of a vote, such as when ArrowMark receives distribution fees (i.e., Rule 12b-1 fees) from mutual funds that are maintained in client accounts and the proxy relates to an increase in 12b-1 fees.

 

   

Where a proxy proposal raises a material conflict of interest between ArrowMark’s interests and that of one or more its clients, including a mutual fund client, the Glass Lewis recommendations will be followed.

 

IV.            Procedures for ArrowMark’s Receipt of Class Actions

 

ArrowMark recognizes that as a fiduciary it has a duty to act with the highest obligation of good faith, loyalty, fair dealing and due care.  When a recovery is achieved in a class action, investors who owned shares in the company subject to the action have the option to either: (1) opt out of the class action and pursue their own remedy; or (2) participate in the recovery achieved via the class action.  Collecting the recovery involves the completion of a Proof of Claim form which is submitted to the Claims Administrator.  After the Claims Administrator receives all Proof of Claims, it dispenses the money from the settlement fund to those persons and entities with valid claims. 

 

ArrowMark has engaged an independent class action service, Battea, to handle all class action proceedings.

 

V.              Recordkeeping

 

In accordance with Rule 204-2 under the Advisers Act, ArrowMark will maintain for the time periods set forth in the Rule

(i) these proxy voting procedures and policies, and all amendments thereto;

(ii) all proxy statements received regarding client securities (provided however, that the we may rely on the proxy statement filed on EDGAR as its records);

(iii) a record of all votes cast on behalf of clients;

(iv) records of all client requests and subsequent responses regarding proxy voting information;

(v) any documents prepared by ArrowMark that were material to making a decision how to vote or that memorialized the basis for the decision; and

(vi) all records relating to requests made to clients regarding conflicts of interest in voting the proxy.

Such records will be maintained in a readily accessible manner for a period of at least seven years.  Proxy statements on file with EDGAR or maintained by the Proxy Manager are not subject to these retention requirements.

 

VI.            Disclosure

 

ArrowMark will ensure that Part II of Form ADV and/or the Fund documents are updated as necessary to reflect its proxy voting policies and procedures and: (i) all material changes to the Proxy Voting Policy and Procedures; and (ii) information about how clients may obtain information on how ArrowMark voted their securities. 

 

ArrowMark will enter into arrangements with all mutual fund clients to provide any information required to be filed by such mutual fund on Form N-PX 60 days after June 30 of each year, and will provide information as requested by the client mutual funds' board of directors.

 

VII.          Proxy Solicitation

  1.                As a matter of practice, it is ArrowMark’s policy to not reveal or disclose to any client how ArrowMark may have voted (or intends to vote) on a particular proxy until after such proxies have been counted at a shareholder’s meeting.  ArrowMark will not disclose such information to unrelated third parties.