DEF 14A: Tortoise Sustainable and Social Impact Term Fund Seeks Stockholder Approval for New Sub-Advisory Agreement

Tortoise Sustainable and Social Impact Term Fund is seeking stockholder approval for a new sub-advisory agreement with RWC Asset Management LLP due to the Redwheel-Ecofin Transaction.

Summary

• Tortoise Sustainable and Social Impact Term Fund (TEAF) is holding a special meeting on November 7, 2024, to seek stockholder approval for a new sub-advisory agreement.
• The agreement is between the fund's current investment advisor, Tortoise Capital Advisors, L.L.C., and RWC Asset Management LLP (RWC).
• This change is prompted by the Redwheel-Ecofin Transaction, where an RWC affiliate acquired the material business operations of Ecofin Advisors Limited's sustainable infrastructure public equities asset-management business.
• The Board of Directors recommends a vote FOR the proposal.
• The portfolio management, investment objectives, policies, and investment processes of the Company will not change as a result of entering into the proposed new sub-advisory agreement.
• The amount of the advisory fee paid to the Advisor by the Company under its Current Investment Advisory Agreement will not change, and the amount paid to the new Redwheel sub-advisor by the Advisor will not change under the new sub-advisory agreement.
• The Advisor will bear all costs of holding the Meeting, the costs of this proxy solicitation and the incremental costs of mailing the proxy statement to stockholders of record as of the record date.
• As of August 31, 2024, the Advisor had approximately $8.3 billion of client assets under management.
• Redwheel invests over US $17 billion on behalf of its clients.

Sentiment

Score: 7

Explanation: The document is primarily informational, outlining a change in sub-advisory arrangements. The tone is positive, emphasizing continuity and the board's recommendation to approve the change. There are no significant red flags or concerns raised.

Positives

• The fund's investment strategy and objectives will remain consistent.
• The fees paid by the fund will not increase as a result of the new sub-advisory agreement.
• The same individuals responsible for investment management will continue in their roles.
• The Advisor will bear the costs of the meeting and proxy solicitation.
• The Board of Directors believes that the proposal is in the Company's best interests and recommends a vote FOR the proposal.

Future Outlook

If the Sub-Advisory Agreement is approved by the stockholders, it will continue in effect for an initial period of two years from the Effective Date. Thereafter, the Sub-Advisory Agreement is expected to be continued annually, provided that its continuance is approved by the Board of Directors, including the Independent Directors.

Management Comments

• The Companys Board of Directors believes that the proposal is in the Companys best interests and recommends a vote FOR the proposal to approve a new sub-advisory agreement between the Advisor and RWC.

Industry Context

The consolidation of asset management firms is a continuing trend in the financial industry. This transaction reflects that trend, with RWC acquiring Ecofin's sustainable infrastructure public equities asset-management business.

Comparison to Industry Standards

• It is common for investment companies to utilize sub-advisors to manage portions of their portfolios.
• The fees paid to the advisor are within the range of fees paid by similar funds.
• The Board of Directors considered Redwheel's experience as an investment adviser for another listed equity fund and other registered investment companies.

Stakeholder Impact

• Shareholders will vote on the new sub-advisory agreement.
• The Ecofin investment team will become employees of Redwheel, affecting their employment status.
• The change is not expected to impact the level, nature or quality of services provided to the Company or its stockholders by the Advisor.

Next Steps

• Stockholders need to vote on the proposal to approve the new sub-advisory agreement.
• The Board of Directors will continue to oversee the investment advisor and sub-advisor.
• The Advisor will engage EQ Fund Solutions LLC to assist in proxy solicitations at an estimated cost to the Advisor of $37,015.

Key Dates

Keywords

sub-advisory agreement, RWC Asset Management, Tortoise Sustainable and Social Impact Term Fund, Tortoise Capital Advisors, Redwheel-Ecofin Transaction, investment advisor, proxy statement, stockholders meeting, investment management, Ecofin Advisors