<PAGE> 1
As filed with the Securities and Exchange Commission
on August 7, 1998
Registration No.______
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-14
REGISTRATION STATEMENT UNDER THE
SECURITIES ACT OF 1933
[ ] Pre-Effective Amendment No.____ [ ] Post-Effective Amendment No.____
WARBURG, PINCUS EMERGING MARKETS II FUND, INC.
(Exact Name of Registrant as Specified in Charter)
Area Code and Telephone Number: (212) 878-0600
466 Lexington Avenue
New York, New York 10017-3147
-----------------------------
(Address of Principal Executive Offices) (Zip code)
Mr. Eugene P. Grace
Warburg, Pincus Emerging Markets II Fund, Inc.
466 Lexington Avenue
New York, New York 10017-3147
-----------------------------
(Name and Address of Agent for Service)
copies to:
Rose F. DiMartino, Esq.
Willkie Farr & Gallagher
787 Seventh Avenue
New York, NY 10019-6099
Approximate date of proposed public offering: As soon as possible after the
effective date of this Registration Statement.
Title of Securities Being Registered: Common Stock, $.001 par value per
share.
Registrant has registered an indefinite amount of securities pursuant to Rule
24f-2 under the Investment Company Act of 1940, as amended; accordingly, no fee
is payable herewith. Registrant's Rule 24f-2 Notice for the fiscal period ended
August 31, 1999 will be timely filed with the Securities and Exchange
Commission.
REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES AS
MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL FILE A
FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION STATEMENT
SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF THE
SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(a),
MAY DETERMINE.
<PAGE> 2
CONTENTS OF
REGISTRATION STATEMENT
This Registration Statement contains the following pages and documents:
Front Cover
Contents Page
Cross Reference Sheet
Letter to Shareholders
Notice of Special Meeting
Part A - Prospectus/Proxy Statement
Part B - Statement of Additional Information
Part C - Other Information
Signature Page
Exhibits
<PAGE> 3
FORM N-14 CROSS REFERENCE SHEET
Pursuant to Rule 481(a)
<TABLE>
<CAPTION>
Prospectus/Proxy
Part A Item No. and Caption Statement Caption
--------------------------- -----------------
<S> <C>
Item 1. Beginning of Registration Cover Page; Cross Reference Sheet
Statement and Outside
Front Cover Page of
Prospectus
Item 2. Beginning and Outside Back Table of Contents
Cover Page of Prospectus
Item 3. Fee Table, Synopsis Fee Table; Summary; Risk Factors;
Information, and Risk Comparison of Investment Objectives
Factors and Policies
Item 4. Information About the Summary; Reasons for the
Transaction Reorganization; Information About the
Reorganization; Information on
Shareholders' Rights; Voting
Information; Exhibit A (Plan of
Reorganization)
Item 5. Information About the Cover Page; Summary; Information
Registrant About the Reorganization; Comparison
of Investment Objectives and
Policies; Information on
Shareholders' Rights; Management of
the Funds; Prospectus of Registrant
(Common Shares); Prospectus of
Registrant (Institutional Shares)
Item 6. Information About the Summary; Information About the
Company Being Acquired Reorganization; Comparison of
Investment Objectives and Policies;
Information on Shareholders' Rights;
Additional Information About Warburg
Funds
Item 7. Voting Information Summary; Information About the
Reorganization; Information on
Shareholders' Rights; Voting
Information
Item 8. Interest of Certain Financial Statements and Experts;
Persons and Experts Legal Matters
</TABLE>
<PAGE> 4
<TABLE>
<S> <C>
Item 9. Additional Information Not Applicable
Required for Reoffering By
Persons Deemed to be
Underwriters
</TABLE>
<TABLE>
<CAPTION>
Statement of Additional
Part B Item No. and Caption Information Caption
- --------------------------- -------------------
<S> <C>
Item 10. Cover Page Cover Page
Item 11. Table of Contents Cover Page
Item 12. Additional Information Cover Page; Statement of Additional
About the Registrant Information of Registrant
Item 13. Additional Information Statement of Additional Information
About the Company Being of the BEA Institutional Funds;
Acquired Statement of Additional Information
of the BEA Advisor Funds.
Item 14. Financial Statements Annual Report of BEA Institutional
Funds for the fiscal year ended
August 31, 1997; Annual Report of BEA
Advisor Funds for the fiscal year
ended August 31, 1997; Semiannual
Reports of BEA Institutional Funds
and BEA Advisor Funds for the
semiannual period ended February 28,
1998.
</TABLE>
<TABLE>
<CAPTION>
Part C Item No. and Caption Other Information Caption
- --------------------------- -------------------------
<S> <C>
Item 15. Indemnification Incorporated by reference to Part A
caption "Information on Shareholders'
Rights -- Liability of Directors"
Item 16. Exhibits Exhibits
Item 17. Undertakings Undertakings
</TABLE>
<PAGE> 5
[The RBB Fund, Inc. Letterhead]
BEA INTERNATIONAL EQUITY FUND
BEA EMERGING MARKETS EQUITY FUND
BEA U.S. CORE EQUITY FUND
BEA U.S. CORE FIXED INCOME FUND
BEA STRATEGIC GLOBAL FIXED INCOME FUND
BEA HIGH YIELD FUND
BEA MUNICIPAL BOND FUND
BEA GLOBAL TELECOMMUNICATIONS FUND
BEA LONG-SHORT MARKET NEUTRAL FUND
BEA LONG-SHORT EQUITY FUND
BEA SELECT ECONOMIC VALUE EQUITY FUND
YOUR VOTE IS IMPORTANT
Dear Shareholder:
The Board of Directors of The RBB Fund, Inc. (the "RBB Fund") has recently
reviewed and unanimously endorsed proposals for the reorganization of eleven of
its investment series -- BEA International Equity Fund, BEA Emerging Markets
Equity Fund, BEA U.S. Core Equity Fund, BEA U.S. Core Fixed Income Fund, BEA
Strategic Global Fixed Income Fund, BEA High Yield Fund, BEA Municipal Bond
Fund, BEA Global Telecommunications Fund, BEA Long-Short Market Neutral Fund,
BEA Long-Short Equity Fund and BEA Select Economic Value Equity Fund (each, a
"BEA Fund" and collectively, the "BEA Funds"). UNDER THE TERMS OF THE PROPOSALS,
EACH OF ELEVEN NEWLY-FORMED INVESTMENT COMPANIES -- WARBURG, PINCUS
INTERNATIONAL GROWTH FUND, INC., WARBURG, PINCUS EMERGING MARKETS II FUND, INC.,
WARBURG, PINCUS U.S. CORE EQUITY FUND, INC., WARBURG, PINCUS CORE FIXED INCOME
FUND, INC., WARBURG, PINCUS STRATEGIC GLOBAL FIXED INCOME FUND, INC., WARBURG,
PINCUS HIGH YIELD FUND, INC., WARBURG, PINCUS MUNICIPAL BOND FUND, INC.,
WARBURG, PINCUS GLOBAL TELECOMMUNICATIONS FUND, INC., WARBURG, PINCUS LONG-SHORT
MARKET NEUTRAL FUND, INC., WARBURG, PINCUS LONG-SHORT EQUITY FUND, INC. AND
WARBURG, PINCUS SELECT ECONOMIC VALUE EQUITY FUND, INC. (EACH, A "WARBURG FUND"
AND COLLECTIVELY, THE "WARBURG FUNDS") --WOULD ACQUIRE ALL OR SUBSTANTIALLY ALL
OF THE ASSETS AND LIABILITIES OF THE CORRESPONDING BEA FUND. We are pleased to
invite you to attend a special meeting (the "Meeting") of the shareholders of
each BEA Fund to consider the approval of a Plan of Reorganization (the "Plan")
pursuant to which the reorganization of your Fund (the "Reorganization") would
be effected.
The RBB Fund's Board of Directors and BEA Associates ("BEA"), the BEA Funds'
investment adviser, believe that the Reorganization is in the best interests of
each BEA Fund and its shareholders. Credit Suisse Asset Management, the asset
management business unit of Credit Suisse Group, recently announced a strategic
alliance with Warburg Pincus Asset Management, Inc. ("Warburg"). As part of the
alliance, it is contemplated that, subject to
<PAGE> 6
shareholder approval, the former Advisor Shares of the BEA Funds would be
distributed in the United States under the Warburg Pincus name by Counsellors
Securities Inc., an affiliate of Warburg. The Institutional Shares of the BEA
Funds will continue to be offered under the name "BEA Institutional Funds." The
proposed Reorganization will integrate the BEA Funds fully into the Warburg
Pincus Funds family.
The Reorganization will not result in any material changes to the investment
philosophy or operations of your Fund, since each Warburg Fund has the same
investment objective and substantially the same investment policies as the
corresponding BEA Fund. Each Warburg Fund will have the same investment adviser,
custodian and transfer agent as the corresponding BEA Fund, although Credit
Suisse Asset Management Ltd., an affiliate of BEA Associates, will become
sub-advisor to two Warburg Funds. In addition, BEA (together with Counsellors
Funds Service, Inc. for the former Advisor class of BEA Fund shares), has agreed
to waive fees and reimburse expenses for the one-year period following the
closing of the Reorganization (the "Closing Date") to the extent necessary for
the net expense ratio of each Warburg Fund to be no higher than that of the
corresponding BEA Fund for the thirty days ending on the Closing Date. The
Closing Date is expected to be October 2, 1998 for all Funds except the BEA
Long-Short Market Neutral Fund and the BEA Long-Short Equity Fund for which the
Closing Date is expected to be October 23, 1998.
If shareholders of a BEA Fund approve the Plan, upon consummation of the
Reorganization of that Fund, the BEA Fund will be liquidated. You will become a
shareholder of the corresponding Warburg Fund, having received shares of the
same class with an aggregate value equal to the aggregate net asset value of
your investment in the BEA Fund at the time of the transaction. No sales charge
will be imposed in the transaction. The transactions will, in the opinion of
counsel, be free from federal income taxes to you, the BEA Funds and the Warburg
Funds. BEA or its affiliates will bear all expenses incurred in connection with
the Reorganization of BEA Funds.
The Meeting will be held on September 21, 1998 to consider this transaction. WE
STRONGLY INVITE YOUR PARTICIPATION BY ASKING YOU TO REVIEW, COMPLETE AND RETURN
YOUR PROXY PROMPTLY. If you own shares of more than one BEA Fund, a
separate proxy card is enclosed for each.
Detailed information about the proposed Reorganization is described in the
attached combined prospectus/proxy statement. THE BOARD OF DIRECTORS OF THE RBB
FUND HAS UNANIMOUSLY APPROVED THE REORGANIZATION OF EACH BEA FUND AND RECOMMENDS
THAT YOU VOTE TO APPROVE THE PLAN. On behalf of the Board of Directors, I thank
you for your participation as a shareholder and urge you to please exercise your
right to vote by completing, dating and signing the enclosed proxy card(s). A
self-addressed, postage-paid envelope has been enclosed for your convenience; if
you prefer, you can fax the proxy card to ___________. We also encourage you to
vote by telephone. Proxies may be voted by telephone by calling [____________].
Voting by telephone will reduce the time and costs associated with the proxy
solicitation. If the Fund records proxies by telephone, it will use procedures
designed to (i) authenticate
<PAGE> 7
shareholders' identities, (ii) allow shareholders to authorize the voting of
their shares in accordance with their instructions and (iii) confirm that their
instructions have been properly recorded.
Whichever voting method you choose, please read the full text of the proxy
statement before you vote.
If you have any questions regarding the proposed Reorganization, please feel
free to call Hal Liebes, an officer of BEA Associates, at 212-326-5454, who will
be pleased to assist you.
IT IS VERY IMPORTANT THAT YOUR VOTING INSTRUCTIONS BE RECEIVED PROMPTLY.
Sincerely,
______________________________________
Chairman of the Board
August __, 1998
<PAGE> 8
THE RBB FUND, INC.
Bellevue Park Corporate Center
400 Bellevue Parkway
3rd Floor
Wilmington, Delaware 19809
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
To Be Held on September 21, 1998
Notice is hereby given that a Special Meeting of Shareholders (the
"Meeting") of BEA International Equity Fund, BEA Emerging Markets Equity Fund,
BEA U.S. Core Equity Fund, BEA U.S. Core Fixed Income Fund, BEA Strategic Global
Fixed Income Fund, BEA High Yield Fund, BEA Municipal Bond Fund, BEA Global
Telecommunications Fund, BEA Long-Short Market Neutral Fund, BEA Long-Short
Equity Fund and BEA Select Economic Value Equity Fund, each a series of The RBB
Fund, Inc. (the "RBB Fund"), will be held at the offices of The RBB Fund, Inc.,
400 Bellevue Parkway, Wilmington, Delaware 19809 on September 21, 1998,
commencing at 3:00 p.m. for the following purposes:
1. To approve or disapprove the Plan of Reorganization dated as of
August __, 1998 (the "Plan") providing (i) that each of BEA
International Equity Fund, BEA Emerging Markets Equity Fund, BEA
U.S. Core Equity Fund, BEA U.S. Core Fixed Income Fund, BEA
Strategic Global Fixed Income Fund, BEA High Yield Fund, BEA
Municipal Bond Fund, BEA Global Telecommunications Fund, BEA
Long-Short Market Neutral Fund, BEA Long-Short Equity Fund and
BEA Select Economic Value Equity Fund (each, a "BEA Fund" and
collectively, the "BEA Funds") would be reorganized from a series
of the RBB Fund into Warburg, Pincus International Growth Fund,
Inc., Warburg, Pincus Emerging Markets II Fund, Inc., Warburg,
Pincus U.S. Core Equity Fund, Inc., Warburg, Pincus U.S. Core
Fixed Income Fund, Inc., Warburg, Pincus Strategic Global Fixed
Income Fund, Inc., Warburg, Pincus High Yield Fund, Inc.,
Warburg, Pincus Municipal Bond Fund, Inc., Warburg, Pincus Global
Telecommunications Fund, Inc., Warburg, Pincus Long-Short Market
Neutral Fund, Inc., Warburg, Pincus Long-Short Equity Fund, Inc.
and Warburg, Pincus Select Economic Value Equity Fund, Inc.,
respectively, (each, a "Warburg Fund" and collectively, the
"Warburg Funds"), (ii) that each BEA Fund would transfer to the
corresponding Warburg Fund all or substantially all of its assets
in exchange for shares of the Warburg Fund and the assumption of
liabilities, (iii) that such shares of the Warburg Funds would be
distributed to shareholders of the BEA Funds in liquidation of
the BEA Funds, and (iv) that the BEA Funds would subsequently be
terminated.
2. To transact such other business as may properly come before the
Meeting or any adjournment or adjournments thereof.
<PAGE> 9
THE BOARD OF DIRECTORS OF THE RBB FUND UNANIMOUSLY RECOMMENDS THAT
SHAREHOLDERS OF EACH BEA FUND VOTE TO APPROVE THE PLAN.
The Board of Directors of the RBB Fund has fixed the close of
business on August 21, 1998 as the record date for the determination of
shareholders of the BEA Funds entitled to notice of and to vote at the Meeting
and any adjournment or adjournments thereof.
IT IS IMPORTANT THAT PROXIES BE RETURNED PROMPTLY.
SHAREHOLDERS WHO DO NOT EXPECT TO ATTEND THE SPECIAL MEETING ARE URGED TO
(A) SIGN AND RETURN WITHOUT DELAY THE ENCLOSED PROXY CARD(S) IN THE ENCLOSED
ENVELOPE, WHICH REQUIRES NO POSTAGE IF MAILED IN THE UNITED STATES, (B) VOTE BY
TELEPHONE WITH A TOLL-FREE CALL TO [____________] OR (C) FAX THE ENCLOSED PROXY
CARD(S) TO [EDWARD J. ROACH] AT (302)-791-3067, SO THAT THEIR SHARES MAY BE
REPRESENTED AT THE MEETING. INSTRUCTIONS FOR THE PROPER EXECUTION OF PROXY CARDS
ARE SET FORTH ON THE FOLLOWING PAGE. PROXIES MAY BE REVOKED AT ANY TIME BEFORE
THEY ARE EXERCISED BY THE SUBSEQUENT EXECUTION AND SUBMISSION OF A REVISED
PROXY, BY GIVING WRITTEN NOTICE OF REVOCATION TO THE RBB FUND, INC. AT ANY TIME
BEFORE THE PROXY IS EXERCISED OR BY VOTING IN PERSON AT THE MEETING.
By Order of the Board of Directors
MORGAN R. JONES
Secretary
August __, 1998
YOUR PROMPT ATTENTION TO THE ENCLOSED PROXY WILL HELP TO AVOID
THE EXPENSE OF FURTHER SOLICITATION.
<PAGE> 10
INSTRUCTIONS FOR SIGNING PROXY CARDS
The following general rules for signing proxy cards may be of
assistance to you and avoid the time and expense involved in validating your
vote if you fail to sign your proxy card properly.
1. Individual Accounts: Sign your name exactly as it appears in the
registration on the proxy card.
2. Joint Accounts: Either party may sign, but the name of the party
signing should conform exactly to the name shown in the registration
on the proxy card.
3. All Other Accounts: The capacity of the individual signing the proxy
card should be indicated unless it is reflected in the form of
registration. For example:
<TABLE>
<CAPTION>
REGISTRATION VALID SIGNATURES
------------ ----------------
<S> <C>
CORPORATE ACCOUNTS
(1) ABC Corp. ............................ ABC Corp.
(2) ABC Corp. ............................ John Doe, Treasurer
(3) ABC Corp. ............................
c/o John Doe, Treasurer............... John Doe
(4) ABC Corp. Profit Sharing Plan......... John Doe, Trustee
TRUST ACCOUNTS
(1) ABC Trust............................. Jane B. Doe, Trustee
(2) Jane B. Doe, Trustee..................
u/t/d 12/28/78...................... Jane B. Doe
CUSTODIAL OR ESTATE ACCOUNTS
(1) John B. Smith, Cust.
f/b/o John B. Smith, Jr. UGMA....... John B. Smith
(2) John B. Smith......................... John B. Smith, Jr., Executor
</TABLE>
<PAGE> 11
SUBJECT TO COMPLETION, DATED AUGUST 7, 1998
COMBINED PROSPECTUS/PROXY STATEMENT
AUGUST __, 1998
ACQUISITION OF THE ASSETS OF
BEA INTERNATIONAL EQUITY FUND
BEA EMERGING MARKETS EQUITY FUND
BEA U.S. CORE EQUITY FUND
BEA U.S. CORE FIXED INCOME FUND
BEA STRATEGIC GLOBAL FIXED INCOME FUND
BEA HIGH YIELD FUND
BEA MUNICIPAL BOND FUND
BEA GLOBAL TELECOMMUNICATIONS FUND
BEA LONG-SHORT MARKET NEUTRAL FUND
BEA LONG-SHORT EQUITY FUND
BEA SELECT ECONOMIC VALUE EQUITY FUND
SEPARATE INVESTMENT PORTFOLIOS OF
THE RBB FUND, INC.
400 BELLEVUE PARKWAY
3RD FLOOR
WILMINGTON, DELAWARE 19809
(302) 792-2555
BY AND IN EXCHANGE FOR SHARES OF
WARBURG, PINCUS INTERNATIONAL GROWTH FUND, INC.
WARBURG, PINCUS EMERGING MARKETS II FUND, INC.
WARBURG, PINCUS U.S. CORE EQUITY FUND, INC.
WARBURG, PINCUS U.S. CORE FIXED INCOME FUND, INC.
WARBURG, PINCUS STRATEGIC GLOBAL FIXED INCOME FUND, INC.
WARBURG, PINCUS HIGH YIELD FUND, INC.
WARBURG, PINCUS MUNICIPAL BOND FUND, INC.
WARBURG, PINCUS GLOBAL TELECOMMUNICATIONS FUND, INC.
WARBURG, PINCUS LONG-SHORT MARKET NEUTRAL FUND, INC.
WARBURG, PINCUS LONG-SHORT EQUITY FUND, INC.
WARBURG, PINCUS SELECT ECONOMIC VALUE EQUITY FUND, INC.
466 LEXINGTON AVENUE
NEW YORK, NEW YORK 10017
800-WARBURG
This Combined Prospectus/Proxy Statement is being furnished to
shareholders of BEA International Equity Fund, BEA Emerging Markets Equity Fund,
BEA U.S. Core Equity Fund, BEA U.S. Core Fixed Income Fund, BEA Strategic Global
Fixed Income Fund,
<PAGE> 12
BEA High Yield Fund, BEA Municipal Bond Fund, BEA Global Telecommunications
Fund, BEA Long-Short Market Neutral Fund, BEA Long-Short Equity Fund and BEA
Select Economic Value Equity Fund (each, a "BEA Fund," and collectively, the
"BEA Funds"), each a separate series of The RBB Fund, Inc. (the "RBB Fund"), in
connection with a proposed plan of reorganization (the "Plan") to be submitted
to shareholders of each BEA Fund for consideration at a Special Meeting of
Shareholders to be held on September 21, 1998 at 3:00 p.m. (the "Meeting"), at
the offices of The RBB Fund, Inc. located at 400 Bellevue Parkway, Wilmington,
Delaware 19809, or any adjournment or adjournments thereof.
Each of Warburg, Pincus International Growth Fund, Inc. (the
"Warburg International Fund"), Warburg, Pincus Emerging Markets II Fund, Inc.
(the "Warburg Emerging Markets Fund"), Warburg, Pincus U.S. Core Equity Fund,
Inc. (the "Warburg U.S. Equity Fund"), Warburg, Pincus U.S. Core Fixed Income
Fund, Inc. (the "Warburg Core Fixed Income Fund"), Warburg, Pincus Strategic
Global Fixed Income Fund, Inc. (the "Warburg Global Income Fund"), Warburg,
Pincus High Yield Fund, Inc. (the "Warburg High Yield Fund"), Warburg, Pincus
Municipal Bond Fund, Inc. (the "Warburg Municipal Fund"), Warburg, Pincus
Global Telecommunications Fund, Inc. (the "Warburg Telecommunications Fund"),
Warburg, Pincus Long-Short Market Neutral Fund, Inc. (the "Warburg Market
Neutral Fund"), Warburg, Pincus Long-Short Equity Fund, Inc. (the "Warburg
Long-Short Fund") and Warburg, Pincus Select Economic Value Equity Fund, Inc.
(the "Warburg Economic Value Fund") (each, a "Warburg Fund" and collectively,
the "Warburg Funds") is a newly organized registered investment company.
The proposed reorganization pursuant to the Plan will not result in
any change in the investment philosophy of the BEA Funds. The investment
objectives and policies of each Warburg Fund are the same as those of the
corresponding BEA Funds except for minor differences described under "Comparison
of Investment Objectives and Policies" in this Combined Prospectus/Proxy
Statement. The investment adviser, custodian, transfer agent and accountant for
each Warburg Fund are the same as those of the corresponding BEA Fund, although
an affiliate of BEA Associates will become an investment sub-adviser for the
Warburg Emerging Markets and Global Fixed Income Funds. The distributor of
shares of each Warburg Fund will be Counsellors Securities Inc., which until May
29, 1998 had been the distributor for each RBB Fund.
The Plan provides for all or substantially all of the assets of a
BEA Fund to be acquired by the corresponding Warburg Fund in exchange for shares
of the Warburg Fund and the assumption by such Warburg Fund of liabilities of
the BEA Fund (as regards each BEA Fund, hereinafter referred to as the
"Reorganization"). (The Warburg Funds and the BEA Funds are sometimes referred
to hereinafter as the "Funds" and individually as a "Fund.") Shares of each
Warburg Fund would be distributed to shareholders of the corresponding BEA Fund
in liquidation of the corresponding BEA Fund and thereafter the BEA Fund would
be terminated. As a result of the proposed Reorganization, each shareholder of a
BEA Fund will receive that number of shares of the corresponding Warburg Fund
having an aggregate net asset value equal to the aggregate value of such
shareholder's shares of the BEA Fund immediately prior to the Reorganization.
All expenses of the Reorganization will be borne by
2
<PAGE> 13
BEA Associates ("BEA"). No sales charge will be imposed on the shares of a
Warburg Fund received by the shareholders of the corresponding BEA Fund. This
transaction is structured to be tax-free for federal income tax purposes to
shareholders and to both the Warburg Funds and the BEA Funds.
This Combined Prospectus/Proxy Statement, which should be retained
for future reference, sets forth concisely the information about the Warburg
Funds that a prospective investor should know before voting. This Combined
Prospectus/Proxy Statement is expected to first be sent to shareholders on or
about August __, 1998. A Statement of Additional Information dated August __,
1998, relating to this Combined Prospectus/Proxy Statement and the
Reorganization, has been filed with the Securities and Exchange Commission (the
"SEC") and is incorporated by reference into this Combined Prospectus/Proxy
Statement. A copy of such Statement of Additional Information is available upon
oral or written request and without charge by writing to the Warburg Funds at
the address listed on the cover page of this Combined Prospectus/Proxy Statement
or by calling [____________].
The following documents, which have been filed with the SEC, are
incorporated herein in their entirety by reference.
1. The Prospectus of each class of shares offered by the Warburg Funds,
each dated August __, 1998. The Warburg Fund Prospectus relating to
each class of shares of each BEA Fund held by a shareholder
accompanies this Combined Prospectus/Proxy Statement.
2. The current Prospectuses of the RBB Fund on behalf of each class of
shares of the BEA Funds. These may be obtained without charge by
writing to the address on the cover page of this Combined
Prospectus/Proxy Statement or by calling [____________].
3. The Annual Report of the RBB Fund for the fiscal year ended August
31, 1997 and the Semiannual Report for the six-month period ended
February 28, 1998.
Accompanying this Combined Prospectus/Proxy Statement as Exhibit A
is a copy of the form of Plan of Reorganization (the "Plan") for the proposed
Reorganization.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS
THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED
UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS COMBINED PROSPECTUS/PROXY
STATEMENT AND IN
3
<PAGE> 14
THE MATERIALS EXPRESSLY INCORPORATED HEREIN BY REFERENCE AND, IF GIVEN OR MADE,
SUCH OTHER INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN
AUTHORIZED BY THE FUNDS.
4
<PAGE> 15
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
ADDITIONAL MATERIALS .................................................... 6
SUMMARY ................................................................. 7
RISK FACTORS ............................................................ 12
REASONS FOR THE REORGANIZATION .......................................... 12
FEE TABLES .............................................................. 14
INFORMATION ABOUT THE REORGANIZATION .................................... 24
COMPARISON OF INVESTMENT OBJECTIVES AND POLICIES ........................ 30
MANAGEMENT OF THE FUNDS ................................................. 31
INTEREST OF BEA IN THE REORGANIZATION ................................... 32
INTEREST OF WARBURG IN THE REORGANIZATION ............................... 32
INFORMATION ON SHAREHOLDERS' RIGHTS ..................................... 32
ADDITIONAL INFORMATION .................................................. 34
VOTING INFORMATION ...................................................... 34
OTHER BUSINESS .......................................................... 37
FINANCIAL STATEMENTS AND EXPERTS ........................................ 37
LEGAL MATTERS ........................................................... 37
EXHIBIT A: FORM OF PLAN OF REORGANIZATION ............................... A-1
</TABLE>
5
<PAGE> 16
ADDITIONAL MATERIALS
The following additional materials, which have been incorporated by
reference into the Statement of Additional Information dated August __, 1998
relating to this Combined Prospectus/Proxy Statement and the Reorganization,
will be sent to all shareholders of the relevant BEA Fund requesting a copy of
such Statement of Additional Information.
1. The Statement of Additional Information for each class of shares of the
Warburg Funds, each dated August __, 1998.
2. The current Statement of Additional Information for each class of
shares of the BEA Funds.
6
<PAGE> 17
SUMMARY
THIS SUMMARY IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO THE ADDITIONAL
INFORMATION CONTAINED ELSEWHERE IN THIS COMBINED PROSPECTUS/PROXY STATEMENT, THE
PLAN, A COPY OF THE FORM OF WHICH IS ATTACHED TO THIS COMBINED PROSPECTUS/PROXY
STATEMENT AS EXHIBIT A, THE PROSPECTUSES OF THE BEA FUNDS, THE STATEMENTS OF
ADDITIONAL INFORMATION OF THE BEA FUNDS, THE PROSPECTUSES OF THE WARBURG FUNDS
AND THE STATEMENTS OF ADDITIONAL INFORMATION OF THE WARBURG FUNDS.
PROPOSED REORGANIZATION. The Plan provides for the transfer of all
or substantially all of the assets and liabilities of each BEA Fund to the
corresponding Warburg Fund in exchange for shares of the Warburg Fund. The Plan
also calls for the distribution of shares of a Warburg Fund to the corresponding
BEA Fund's shareholders in liquidation of the BEA Fund. (The foregoing proposed
transactions as regards each BEA Fund are referred to in this Combined
Prospectus/Proxy Statement as the "Reorganization.") As a result of the
Reorganization, each shareholder of a BEA Fund will become the owner of that
number of full and fractional shares of the same class of the corresponding
Warburg Fund having an aggregate net asset value equal to the aggregate value of
the shareholder's shares of the BEA Fund as of the close of business on the date
that each BEA Fund's assets are exchanged for shares of the corresponding
Warburg Fund. HOLDERS OF ADVISOR SHARES OF A BEA FUND WILL BECOME HOLDERS OF
COMMON SHARES OF THE CORRESPONDING WARBURG FUND AND HOLDERS OF INSTITUTIONAL
SHARES OF A BEA FUND WILL BECOME HOLDERS OF INSTITUTIONAL SHARES OF THE
CORRESPONDING WARBURG FUND. THE WARBURG FUNDS WILL ALSO HAVE A CLASS OF ADVISOR
SHARES, ALTHOUGH SUCH SHARES ARE CURRENTLY NOT INTENDED TO BE OFFERED. See
"Information About the Reorganization --Plan of Reorganization."
For the reasons set forth below under "Reasons for the
Reorganization," the Board of Directors of the RBB Fund, including the Directors
of the RBB Fund who are not "interested persons" (the "Independent Directors"),
as that term is defined in the Investment Company Act of 1940, as amended (the
"1940 Act"), has unanimously concluded that the Reorganization would be in the
best interests of the shareholders of each BEA Fund and that the interests of
each BEA Fund's existing shareholders will not be diluted as a result of the
transaction contemplated by the Reorganization. The Board therefore has
submitted the Plan for approval by each BEA Fund's shareholders. The Board of
Directors of each Warburg Fund has also reached similar conclusions and approved
the Reorganization with respect to the Warburg Funds.
Approval of the Reorganization of a BEA Fund will require the
affirmative vote of the holders of a majority of that BEA Fund's outstanding
shares. See "Voting Information." No Reorganization of any BEA Fund is
contingent on the approval and/or closing of the Reorganization of any other BEA
Fund. In the event that the Plan is not approved by shareholders of one or more
BEA Funds, the Board will consider other possible
7
<PAGE> 18
courses of action available to it, including resubmitting the Reorganization
proposal to shareholders.
TAX CONSEQUENCES. Prior to completion of the Reorganization, each
BEA Fund and its corresponding Warburg Fund will have received an opinion of
counsel that, upon the closing of the Reorganization and the transfer of the
assets of such BEA Fund, no gain or loss will be recognized by the BEA Fund or
its shareholders for federal income tax purposes. The holding period and
aggregate tax basis of the corresponding Warburg Fund's shares received by a BEA
Fund shareholder will be the same as the holding period and aggregate tax basis
of the shares of the BEA Fund previously held by such shareholder. In addition,
the holding period and tax basis of the assets of each BEA Fund in the hands of
the corresponding Warburg Fund as a result of the Reorganization will be the
same as in the hands of the BEA Fund immediately prior to the Reorganization.
INVESTMENT OBJECTIVES AND POLICIES. Each Warburg Fund was organized
for the purpose of acquiring the assets of the corresponding BEA Fund and each
Warburg Fund will have the same investment objective, and, except as noted below
under "Comparison of Investment Objectives and Policies," the same investment
policies and limitations as the corresponding BEA Fund.
PURCHASE AND REDEMPTION PROCEDURES. The purchase and redemption
procedures available to shareholders of each Warburg Fund are virtually
identical to those available to shareholders of the corresponding BEA Fund,
except that the initial and subsequent investment minimums of the Warburg Funds
for the Common Share class are higher than those for the comparable class of BEA
Funds. These higher minimums will not apply to holders of the BEA Fund shares on
the Closing Date of the Reorganization. Purchases of shares of each Warburg Fund
and the corresponding BEA Fund may be made by mail, or with advance
arrangements, by wire through the Funds' distributor. Shares of the Funds are
sold at net asset value per share and without a sales charge. Common Shares of
the Warburg Funds and Advisor Shares of the BEA Funds are subject to a 12b-1 fee
of .25% per annum. Advisor Shares of the Warburg Funds are subject to a 12b-1
fee of up to .75% per annum.
EXCHANGE PRIVILEGES. The exchange privileges available to
shareholders of each Warburg Fund are substantially identical to those available
to shareholders of the corresponding BEA Fund. Shareholders of each BEA Fund and
the corresponding Warburg Fund may exchange at net asset value all or a portion
of their shares for shares of the same class of certain other mutual funds in
the Warburg Pincus family of funds at their respective net asset values.
Shareholders may thus not effect exchanges between one class of shares (e.g.,
Common Shares) of a Warburg Fund and any other class of shares (e.g.,
Institutional Shares) of any other Warburg Fund. Exchanges may be effected by
mail or by telephone, except that exchanges of Institutional Shares, like
purchases of those shares, may only be effected in writing. Exchanges will be
effected without a sales charge but must satisfy the minimum dollar amount
necessary for new purchases. A Fund may refuse exchange purchases at any time
without prior notice. The exchange privilege may be modified or terminated at
8
<PAGE> 19
any time upon 30 days' notice to shareholders. Currently, Common Share exchanges
may be made among the Warburg Funds offering Common Shares and with the
following other Warburg Pincus Funds:
- WARBURG PINCUS BALANCED FUND -- a fund seeking maximum total return
through a combination of long-term growth of capital and current
income consistent with preservation of capital through diversified
investments in equity and debt securities;
- WARBURG PINCUS CAPITAL APPRECIATION FUND -- an equity fund seeking
long-term capital appreciation by investing primarily in a broadly
diversified portfolio of equity securities of domestic companies;
- WARBURG PINCUS CASH RESERVE FUND -- a money market fund investing in
short-term, high quality money market instruments;
- WARBURG PINCUS EMERGING GROWTH FUND -- an equity fund seeking
maximum capital appreciation by investing in emerging growth
companies;
- WARBURG PINCUS EMERGING MARKETS FUND -- an equity fund seeking
growth of capital by investing primarily in securities of non-United
States issuers consisting of companies in emerging securities
markets;
- WARBURG PINCUS FIXED INCOME FUND -- a bond fund seeking current
income and, secondarily, capital appreciation by investing in a
diversified portfolio of fixed-income securities;
- WARBURG PINCUS GLOBAL FIXED INCOME FUND -- a bond fund investing in
a portfolio consisting of investment grade fixed income securities
of governmental and corporate issuers denominated in various
currencies, including U.S. dollars;
- WARBURG PINCUS GLOBAL POST-VENTURE CAPITAL FUND -- an equity fund
seeking long-term growth of capital by investing principally in
equity securities of U.S. and foreign issuers in their post-venture
capital stage of development;
- WARBURG PINCUS GROWTH & INCOME FUND -- an equity fund seeking
long-term growth of capital and income and a reasonable current
return;
- WARBURG PINCUS HEALTH SCIENCES FUND -- an equity fund seeking
capital appreciation by investing primarily in equity and debt
securities of health sciences companies;
9
<PAGE> 20
- WARBURG PINCUS INTERMEDIATE MATURITY GOVERNMENT FUND -- an
intermediate-term bond fund investing in obligations issued or
guaranteed by the U.S. government, its agencies or
instrumentalities;
- WARBURG PINCUS INTERNATIONAL EQUITY FUND -- an international equity
fund seeking long-term capital appreciation;
- WARBURG PINCUS INTERNATIONAL SMALL COMPANY FUND -- an equity fund
seeking capital appreciation by investing in a portfolio of equity
securities of non-United States small-sized companies;
- WARBURG PINCUS JAPAN GROWTH FUND -- an equity fund seeking long-term
growth of capital by investing primarily in equity securities of
Japanese issuers;
- WARBURG PINCUS JAPAN SMALL COMPANY FUND -- an equity fund seeking
long-term capital appreciation by investing in a portfolio of
securities of small Japanese companies;
- WARBURG PINCUS MAJOR FOREIGN MARKETS FUND -- an equity fund seeking
long-term capital appreciation by investing in equity securities of
issuers consisting of companies in major foreign securities markets;
- WARBURG PINCUS NEW YORK INTERMEDIATE MUNICIPAL FUND -- an
intermediate-term municipal bond fund designed for New York
investors seeking income exempt from federal, New York State and New
York City income tax;
- WARBURG PINCUS NEW YORK TAX EXEMPT FUND -- a money market fund
investing in short-term, high quality municipal obligations designed
for New York investors seeking income exempt from federal, New York
State and New York City income tax;
- WARBURG PINCUS POST-VENTURE CAPITAL FUND -- an equity fund seeking
long-term growth of capital by investing principally in equity
securities of issuers in their post-venture capital stage of
development;
- WARBURG PINCUS SMALL COMPANY GROWTH FUND* -- an equity fund seeking
capital growth by investing in equity securities of small-sized
domestic companies; and
- -------------------
* Warburg Pincus Small Company Growth Fund is currently closed to certain new
investors; the Small Company Growth Fund's prospectus describes the types of
investors that may purchase shares.
10
<PAGE> 21
- WARBURG PINCUS SMALL COMPANY VALUE FUND -- an equity fund seeking
long-term capital appreciation by investing primarily in equity
securities of small companies.
A shareholder holding Institutional Shares of a Warburg Fund may
exchange those shares only for Institutional Shares of the other Warburg Funds.
The exchange privilege is available to shareholders residing in any
state in which the Fund's shares being acquired may legally be sold. When an
investor effects an exchange of shares, the exchange is treated for federal
income tax purposes as a redemption. Therefore, the investor may realize a
taxable gain or loss in connection with the exchange. No initial sales charge is
imposed on the shares being acquired in an exchange. See "How to Redeem and
Exchange Shares" in the accompanying Prospectuses of the Warburg Funds.
DIVIDENDS. Each Warburg Fund and each BEA Fund will distribute
substantially all of the Fund's net investment income and net realized capital
gains, if any, to the Fund's shareholders. All distributions are reinvested in
the form of additional full and fractional shares unless a shareholder elects
otherwise. The BEA International Equity Fund, BEA Emerging Markets Equity Fund,
BEA U.S. Core Equity Fund, BEA Global Telecommunications Fund, BEA Long-Short
Market Neutral Fund, BEA Long-Short Equity Fund and BEA Select Economic Value
Equity Fund, and the corresponding Warburg Funds, declare and pay dividends, if
any, from net investment income annually. The BEA U.S. Core Fixed Income Fund,
BEA Strategic Global Fixed Income Fund, BEA High Yield and BEA Municipal Bond
Fund, and the corresponding Warburg Funds, declare and pay dividends from net
investment income at least quarterly. Net realized capital gains (including net
short-term capital gains), if any, of each Warburg Fund, like each BEA Fund,
will be distributed at least annually. See "Dividends, Distributions and Taxes"
in the accompanying Prospectuses of the Warburg Funds.
SHAREHOLDER VOTING RIGHTS. The Warburg Funds are registered with the
Securities and Exchange Commission as open-end management investment companies.
The BEA Funds are each a separate series of RBB Fund which is also registered as
an open-end management investment company. The RBB Fund and each of the Warburg
Funds are Maryland corporations, each having a Board of Directors. Shareholders
of both the Warburg Funds and the BEA Funds have similar voting rights. Neither
the Warburg Funds nor the RBB Fund on behalf of the BEA Funds holds a meeting of
shareholders annually, except as required by the 1940 Act or other applicable
law. Each Warburg Fund's By-Laws provide that shareholders collectively owning
at least ten percent of the outstanding shares of all classes of stock of the
Fund have the right to call for a meeting of shareholders to consider the
removal of one or more directors. To the extent required by law, the Warburg
Funds will assist in shareholder communication in such matters. The presence of
one-third of the shareholders at a shareholder meeting will constitute a quorum.
In addition, under the laws of the State of Maryland, shareholders
of the Warburg Funds and the BEA Funds do not have appraisal rights in
connection with a
11
<PAGE> 22
combination or acquisition of the assets of the Fund by another entity.
Shareholders of a BEA Fund may, however, redeem their shares at net asset value
prior to the date of the Reorganization (subject only to certain restrictions
set forth in the 1940 Act). See "Information on Shareholders' Rights -- Voting
Rights."
RISK FACTORS
Due to the fact that the investment objectives, policies and
restrictions of each Warburg Fund are virtually identical to those of the
corresponding BEA Fund, the investment risks are substantially similar. See the
accompanying Prospectuses of the applicable Warburg Fund for a complete
discussion of the risks investing in that Fund.
REASONS FOR THE REORGANIZATION
The Board of Directors of the RBB Fund has determined that it is in
the best interest of each BEA Fund to effect the Reorganization. In reaching
this conclusion, the Board considered a number of factors, including the
following:
1. the terms and conditions of the Reorganization;
2. the identical investment objectives and substantially
identical policies and restrictions of each Warburg Fund in relation to
those of the corresponding BEA Fund;
3. that the investment adviser, custodian, transfer agent and
accountant for each Warburg Fund are the same as those of the
corresponding BEA Fund;
4. the federal tax consequences of the Reorganization to the BEA
Funds, the Warburg Funds and the shareholders of each, and that a legal
opinion will be rendered that no recognition of income, gain or loss for
federal income tax purposes will occur as a result of the Reorganization
to any of them;
5. that the interests of shareholders of the BEA Funds will not be
diluted as a result of the Reorganization;
6. BEA (together with Counsellors Funds Service, Inc. ("CFSI") with
respect to the former Advisor class of BEA Fund shares) has agreed to
waive fees and reimburse expenses for the one-year period following the
closing of the Reorganization to the extent necessary for the net expense
ratio of each Warburg Fund to be no higher than that of the corresponding
BEA Fund for the thirty days ending on the closing of the Reorganization
(the "Closing Date");
7. that the expenses of the Reorganization will be borne by BEA;
8. that no sales charge will be imposed in connection with the
Reorganization;
12
<PAGE> 23
9. that the Reorganization would integrate the BEA Funds fully into
the Warburg Pincus Funds family, thereby, among other things, making
operations consistent, and, for the Advisor class of shares, materially
increasing the funds for which they are exchangeable; and
10. that the Reorganization may increase economic efficiencies of
the BEA Funds.
BEA informed the Board that Credit Suisse Asset Management, the
asset management business unit of Credit Suisse Group, had entered into a
strategic alliance with Warburg Pincus Asset Management, Inc. pursuant to which
the two firms would engage in various activities on a joint basis. As part of
the alliance, subject to the receipt of necessary approvals, it is contemplated
that the Advisor class of shares of the BEA Funds would be marketed under the
Warburg Pincus name, along with new retail funds to be created in the near
future. Although the Institutional Shares would be a class of shares of the
Warburg Funds, the Institutional class of shares of the BEA Funds would continue
to be offered under the name "BEA Institutional Funds." The Reorganization would
effectuate the purposes underlying the Credit Suisse/Warburg Pincus alliance.
The Reorganization would also permit all BEA-advised U.S. retail mutual funds to
be marketed under a single name and give those funds access to the marketing
resources of Warburg Pincus.
In light of the foregoing, the Board of Directors of the RBB Fund,
including the Independent Directors, has determined that it is in the best
interest of each BEA Fund and its shareholders to effect the Reorganization. The
Board of Directors has also determined that the Reorganization of a BEA Fund and
the corresponding Warburg Fund would not result in a dilution of the interests
of the BEA Fund's shareholders.
The Board of Directors of each Warburg Fund has also determined that
it is advantageous to the Warburg Fund to effect the Reorganization. The Boards
of Directors also considered the terms and conditions of the Reorganization and
representations that the Reorganization would be effected as a tax-free
reorganization. Accordingly, the Board of Directors of each Warburg Fund,
including a majority of the Independent Directors, has determined that the
Reorganization is in the best interests of the Warburg Fund's shareholders and
that the interests of the Warburg Fund's shareholders would not be diluted as a
result of the Reorganization.
13
<PAGE> 24
FEE TABLES
Following are tables showing current costs and expenses of each
class of outstanding shares of the BEA Funds and the costs and expenses expected
to be incurred by the corresponding classes of the Warburg Funds after giving
effect to the Reorganization. The tables do not reflect charges that
institutions and financial intermediaries may impose on their customers.
<TABLE>
<CAPTION>
==============================================================================================================================
INTERNATIONAL FUND INSTITUTIONAL SHARES* COMMON SHARES**
==============================================================================================================================
BEA Fund Warburg Fund BEA (Advisor) Warburg Fund
Fund
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
SHAREHOLDER TRANSACTION EXPENSES:
Maximum sales charge imposed on purchases
(as a percentage of offering price)..... None None None None
- ------------------------------------------------------------------------------------------------------------------------------
ANNUAL OPERATING EXPENSES (after fee waivers and
expense reimbursements)
Management fees......................... .80% .80% .80% .80%
12b-1 fees***........................... None None .25% .25%
Other expenses.......................... .36% .36% .38% .38%
- ------------------------------------------------------------------------------------------------------------------------------
TOTAL OPERATING EXPENSES (after waivers
and reimbursements)..................... 1.16% 1.16% 1.43% 1.43%
==============================================================================================================================
</TABLE>
<TABLE>
<CAPTION>
==============================================================================================================================
EMERGING MARKETS FUND INSTITUTIONAL SHARES* COMMON SHARES**
==============================================================================================================================
BEA Fund Warburg Fund BEA (Advisor) Warburg Fund
Fund
- ------------------------------------------------------------------------------------------------------------------------------
SHAREHOLDER TRANSACTION EXPENSES:
Maximum sales charge imposed on purchases
(as a percentage of offering price)..... None None* None None
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
ANNUAL OPERATING EXPENSES (after fee waivers and
expense reimbursements)
Management fees......................... .98% .98% .98% .98%
12b-1 fees***........................... None None .25% .25%
Other expenses.......................... .51% .51% .52% .52%
- ------------------------------------------------------------------------------------------------------------------------------
TOTAL OPERATING EXPENSES (after waivers
and reimbursements)..................... 1.49% 1.49% 1.75% 1.75%
==============================================================================================================================
</TABLE>
14
<PAGE> 25
<TABLE>
<CAPTION>
=============================================================================================================
U.S. EQUITY FUND INSTITUTIONAL SHARES* COMMON SHARES**
=============================================================================================================
BEA
(Advisor)
BEA Fund Warburg Fund Fund Warburg Fund
- -------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
SHAREHOLDER TRANSACTION EXPENSES:
Maximum sales charge imposed on
purchases (as a percentage of
offering price)....................... None None None None
- -------------------------------------------------------------------------------------------------------------
ANNUAL OPERATING EXPENSES (after fee
waivers and expense reimbursements)
Management fees....................... .71% .71% .71% .71%
12b-1 Fees............................ None None .25% .25%
Other expenses........................ .29% .29% .29% .29%
- -------------------------------------------------------------------------------------------------------------
TOTAL OPERATING EXPENSES (after waivers
and reimbursements) 1.00% 1.00% 1.25% 1.25%
=============================================================================================================
</TABLE>
<TABLE>
<CAPTION>
====================================================================================
CORE FIXED INCOME FUND INSTITUTIONAL SHARES*
====================================================================================
BEA Fund Warburg Fund
- --------------------------------------------------------------------------------
<S> <C> <C>
SHAREHOLDER TRANSACTION EXPENSES:
Maximum sales charge imposed on purchases
(as a percentage of offering price)..... None None
- --------------------------------------------------------------------------------
ANNUAL OPERATING EXPENSES (after fee waivers
and expense reimbursements)
Management fees......................... .25% .25%
Other expenses.......................... .20% .20%
- --------------------------------------------------------------------------------
TOTAL OPERATING EXPENSES (after waivers
and reimbursements)..................... .45% .45%
====================================================================================
</TABLE>
15
<PAGE> 26
<TABLE>
<CAPTION>
====================================================================================
GLOBAL INSTITUTIONAL SHARES*
INCOME FUND
====================================================================================
BEA Fund Warburg Fund
- ------------------------------------------------------------------------------------
<S> <C> <C>
SHAREHOLDER TRANSACTION EXPENSES:
Maximum sales charge imposed on purchases
(as a percentage of offering price)..... None None
- ------------------------------------------------------------------------------------
ANNUAL OPERATING EXPENSES (after fee waivers
and expense reimbursements)
Management fees......................... .43% .43%
Other expenses.......................... .32% .32%
- ------------------------------------------------------------------------------------
TOTAL OPERATING EXPENSES (after waivers
and reimbursements)..................... .75% .75%
====================================================================================
</TABLE>
<TABLE>
<CAPTION>
============================================================================================================================
HIGH YIELD FUND INSTITUTIONAL SHARES* COMMON SHARES**
============================================================================================================================
BEA Fund Warburg Fund BEA (Advisor) Warburg Fund
Fund
- ----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
SHAREHOLDER TRANSACTION EXPENSES:
Maximum sales charge imposed on purchases (as a
percentage of offering price)................ None None None None
- ----------------------------------------------------------------------------------------------------------------------------
ANNUAL OPERATING EXPENSES (after fee waivers and
expense reimbursements)
Management fees.............................. .44% .44% .44% .44%
12b-1 fees***................................ None None .25% .25%
Other expenses............................... .26% .26% .27% .27%
- ----------------------------------------------------------------------------------------------------------------------------
TOTAL OPERATING EXPENSES (after waivers
and reimbursements).......................... .70% .70% .96% .96%
============================================================================================================================
</TABLE>
16
<PAGE> 27
<TABLE>
<CAPTION>
========================================================================================
MUNICIPAL FUND INSTITUTIONAL SHARES*
========================================================================================
BEA Fund Warburg Fund
- ----------------------------------------------------------------------------------------
<S> <C> <C>
SHAREHOLDER TRANSACTION EXPENSES:
Maximum sales charge imposed on
purchases (as a percentage of offering
price)................................. None None
- ----------------------------------------------------------------------------------------
ANNUAL OPERATING EXPENSES (after fee waivers
and expense reimbursements)
Management fees........................ .47% .47%
Other expenses......................... .53% .53%
- ----------------------------------------------------------------------------------------
TOTAL OPERATING EXPENSES (after waivers
and reimbursements).................... 1.00% 1.00%
========================================================================================
</TABLE>
<TABLE>
<CAPTION>
========================================================================================
TELECOMMUNICATIONS FUND COMMON SHARES**
========================================================================================
BEA (Advisor) Warburg Fund
Fund
- -----------------------------------------------------------------------------------------
<S> <C> <C>
SHAREHOLDER TRANSACTION EXPENSES:
Maximum sales charge imposed on purchases
(as a percentage of offering price)..... None None
- -----------------------------------------------------------------------------------------
ANNUAL OPERATING EXPENSES (after fee waivers
and expense reimbursements)
Management fees........................ 0% 0%
12b-1 fees***.......................... .25% .25%
Other expenses......................... 1.40% 1.40%
- -----------------------------------------------------------------------------------------
TOTAL OPERATING EXPENSES (after waivers
and reimbursements).................... 1.65% 1.65%
========================================================================================
</TABLE>
17
<PAGE> 28
<TABLE>
<CAPTION>
===============================================================================================================================
MARKET NEUTRAL FUND INSTITUTIONAL SHARES* COMMON SHARES**
===============================================================================================================================
BEA Fund Warburg Fund BEA (Advisor) Warburg Fund
Fund
- -------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
SHAREHOLDER TRANSACTION EXPENSES:
Maximum sales charge imposed on purchases (as a
percentage of offering price).............. None None None None
- -------------------------------------------------------------------------------------------------------------------------------
ANNUAL OPERATING EXPENSES (after fee waivers and
expense reimbursements)
Management fees****........................ 1.40% 1.40% 1.40% 1.40%
12b-1 fees***.............................. None None .25% .25%
Other expenses............................. .60% .60% .60% .60%
- -------------------------------------------------------------------------------------------------------------------------------
TOTAL OPERATING EXPENSES (after waivers
and reimbursements)........................ 2.00% 2.00% 2.25% 2.25%
===============================================================================================================================
</TABLE>
<TABLE>
<CAPTION>
===============================================================================================================================
LONG-SHORT FUND INSTITUTIONAL SHARES* COMMON SHARES**
===============================================================================================================================
BEA Fund Warburg Fund BEA (Advisor) Warburg Fund
Fund
- -------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
SHAREHOLDER TRANSACTION EXPENSES:
Maximum sales charge imposed on purchases (as a
percentage of offering price)................ None None None None
- -------------------------------------------------------------------------------------------------------------------------------
ANNUAL OPERATING EXPENSES (after fee waivers and
expense reimbursements)
Management fees.............................. 0% 0% 0% 0%
12b-1 fees***................................ None None .25% .25%
Other expenses............................... 2.5% 2.5% 2.5% 2.5%
- -------------------------------------------------------------------------------------------------------------------------------
TOTAL OPERATING EXPENSES (after waivers
and reimbursements).......................... 2.5% 2.5% 2.75% 2.75%
===============================================================================================================================
</TABLE>
18
<PAGE> 29
<TABLE>
<CAPTION>
===============================================================================================================================
ECONOMIC VALUE FUND INSTITUTIONAL SHARES* COMMON SHARES**
===============================================================================================================================
BEA Fund Warburg Fund BEA (Advisor) Warburg Fund
Fund
- -------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
SHAREHOLDER TRANSACTION EXPENSES:
Maximum sales charge imposed on purchases (as a
percentage of offering price)................ None None None None
- -------------------------------------------------------------------------------------------------------------------------------
ANNUAL OPERATING EXPENSES (after fee waivers and
expense reimbursements)
Management fees.............................. .52% .52% .52% .52%
12b-1 fees***................................ None None .25% .25%
Other expenses............................... .48% .48% .48% .48%
- -------------------------------------------------------------------------------------------------------------------------------
TOTAL OPERATING EXPENSES (after waivers
and reimbursements).......................... 1.00% 1.00% 1.25% 1.25%
===============================================================================================================================
</TABLE>
* BEA has agreed to waive fees and reimburse expenses of the Institutional
Shares of each Warburg Fund for a one-year period following the closing of a
Reorganization so that the expense ratio of such shares will be no higher than
that of the corresponding BEA Fund for the thirty days ending on the Closing
Date of the Reorganization.
** The Warburg Funds Common Shares (and BEA Advisor Shares) impose a 12b-1
fee of up to .25% per annum, which is the economic equivalent of a sales charge.
*** BEA and CFSI, have agreed to waive fees and reimburse expenses of the
Common Shares of each Warburg Fund for a one-year period following the closing
of the Reorganization so that the expense ratio of such shares will be no higher
than that of the Advisor class of the corresponding BEA Fund for the thirty days
ending on the Closing Date of the Reorganization.
**** The Management Fee for the Market Neutral Fund may be increased or
decreased by applying a performance adjustment after the Fund's first year of
operations.
19
<PAGE> 30
The expense figures for the Funds are based upon fees and costs as of
August 31, 1997 except for those Funds which were not in operation on that date.
For these Funds, expenses are estimated for the current fiscal year. In
addition, the Fee Tables for the Warburg Funds reflect a voluntary assumption of
some of the additional expenses of the BEA Funds by BEA or, in the case of the
Advisor Shares, BEA and CSFI. Absent such expense reimbursements, under current
expense levels, the resulting fees and expenses for the Funds are illustrated in
the following table:
<TABLE>
<CAPTION>
==============================================================================================================================
FUND MANAGEMENT RULE OTHER TOTAL
FEES 12b-1 FEES EXPENSES EXPENSES
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
International Growth Fund - Institutional Shares
BEA Fund...................................... .80% 0 .45% 1.25%
Warburg Fund.................................. .80% 0 .45% 1.25%
International Growth Fund - Common Shares
BEA (Advisor) Fund............................ .80% .25% .48% 1.53%
Warburg Fund.................................. .80% .25% .48% 1.53%
- ------------------------------------------------------------------------------------------------------------------------------
Emerging Markets Fund - Institutional Shares
BEA Fund...................................... 1.00% 0 .63% 1.63%
Warburg Fund.................................. 1.00% 0 .63% 1.63%
Emerging Markets Fund - Common
Shares
BEA (Advisor) Fund............................ 1.00% .25% .67% 1.92%
Warburg Fund.................................. 1.00% .25% .67% 1.92%
- ------------------------------------------------------------------------------------------------------------------------------
U.S. Equity Fund - Institutional Shares
BEA Fund...................................... .75% 0 .43% 1.18%
Warburg Fund.................................. .75% 0 .43% 1.18%
- ------------------------------------------------------------------------------------------------------------------------------
Core Fixed Income Fund - Institutional Shares
BEA Fund...................................... .375% 0 .405% .78%
Warburg Fund.................................. .375% 0 .405% .78%
- ------------------------------------------------------------------------------------------------------------------------------
Global Income Fund - Institutional Shares
BEA Fund...................................... .50% 0 .48% .98%
Warburg Fund.................................. .50% 0 .48% .98%
==============================================================================================================================
</TABLE>
20
<PAGE> 31
<TABLE>
<CAPTION>
==============================================================================================================================
FUND MANAGEMENT RULE OTHER TOTAL
FEES 12b-1 FEES EXPENSES EXPENSES
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
High Yield Fund - Institutional Shares
BEA Fund................................. .70% 0 .43% 1.13%
Warburg Fund............................. .70% 0 .43% 1.13%
High Yield Fund - Common Shares
BEA (Advisor) Fund....................... .70% .25% .52% 1.47%
Warburg Fund............................. .70% .25% .52% 1.47%
- ------------------------------------------------------------------------------------------------------------------------------
Municipal Fund - Institutional Shares
BEA Fund................................. .70% 0 .67% 1.37%
Warburg Fund ............................ .70% 0 .67% 1.37%
- ------------------------------------------------------------------------------------------------------------------------------
Telecommunications Fund - Common Shares
BEA (Advisor) Fund....................... 1.00% .25% 7.13% 8.38%
Warburg Fund............................. 1.00% .25% 7.13% 8.38%
- ------------------------------------------------------------------------------------------------------------------------------
Market Neutral Fund - Institutional Shares
BEA Fund................................. 1.50% 0 .60% 2.10%
Warburg Fund............................. 1.50% 0 .60% 2.10%
Market Neutral Fund - Common Shares
BEA (Advisor) Fund....................... 1.50% .25% .60% 2.35%
Warburg Fund............................. 1.50% .25% .60% 2.35%
- ------------------------------------------------------------------------------------------------------------------------------
Long-Short Fund - Institutional Shares
BEA Fund................................. .10% 0 2.50% 2.60%
Warburg Fund............................. .10% 0 2.50% 2.60%
Long-Short Fund - Common Shares
BEA (Advisor) Fund....................... .10% .25% 2.50% 2.85%
Warburg Fund............................. .10% .25% 2.50% 2.85%
- ------------------------------------------------------------------------------------------------------------------------------
Economic Value Fund - Institutional Shares
BEA Fund................................. .75% 0 .48% 1.23%
Warburg Fund............................. .75% 0 .48% 1.23%
Economic Value Fund - Common Shares
BEA (Advisor) Fund....................... .75% .25% .48% 1.48%
Warburg Fund............................. .75% .25% .48% 1.48%
==============================================================================================================================
</TABLE>
21
<PAGE> 32
EXAMPLES
The following examples are intended to assist an investor in
understanding the various costs that an investor in the Funds will bear directly
or indirectly. The examples assume payment of operating expenses at the levels
set forth in the tables above.
<TABLE>
<CAPTION>
====================================================================================================================
1 Year 3 Years 5 Years 10 Years
====================================================================================================================
<S> <C> <C> <C> <C>
An investor would pay the following expenses on a
$1,000 investment, assuming (1) 5.00% annual return
and (2) redemption at the end of each time period:
- --------------------------------------------------------------------------------------------------------------------
International Fund - Institutional Shares
BEA Fund............................................ $12 $37 $64 $141
Warburg Fund........................................ $12 $37 $64 $141
International Fund - Common Shares
BEA (Advisor) Fund.................................. $15 $45 $78 $171
Warburg Fund........................................ $15 $45 $78 $171
- --------------------------------------------------------------------------------------------------------------------
Emerging Markets Fund - Institutional Shares
BEA Fund............................................ $15 $47 $81 $178
Warburg Fund........................................ $15 $47 $81 $178
Emerging Markets Fund - Common
Shares
BEA Advisor Fund.................................... $18 $55 $95 $206
Warburg Fund........................................ $18 $55 $95 $206
- --------------------------------------------------------------------------------------------------------------------
U.S. Equity Fund - Institutional Shares
BEA Fund............................................ $10 $32 $55 $122
Warburg Fund........................................ $10 $32 $55 $122
U.S. Equity Fund - Common Shares
BEA Fund............................................ $13 $40 $69 $151
Warburg Fund........................................ $13 $40 $69 $151
- --------------------------------------------------------------------------------------------------------------------
Core Fixed Income Fund - Institutional Shares
BEA Fund............................................ $5 $16 $28 $63
Warburg Fund........................................ $5 $16 $28 $63
- --------------------------------------------------------------------------------------------------------------------
Global Income Fund - Institutional Shares
BEA Fund............................................
Warburg Fund........................................ $8 $24 $42 $93
$8 $24 $42 $93
====================================================================================================================
</TABLE>
22
<PAGE> 33
<TABLE>
<CAPTION>
====================================================================================================================
1 Year 3 Years 5 Years 10 Years
- --------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
High Yield Fund - Institutional Shares
BEA Fund....................................... $7 $22 $39 $87
Warburg Fund................................... $7 $22 $39 $87
High Yield Fund - Common Shares
BEA (Advisor) Fund............................. $10 $31 $53 $118
Warburg Fund................................... $10 $31 $53 $118
- --------------------------------------------------------------------------------------------------------------------
Municipal Fund - Institutional Shares
BEA Fund........................................ $10 $32 $55 $122
Warburg Fund ................................... $10 $32 $55 $122
- --------------------------------------------------------------------------------------------------------------------
Telecommunications Fund - Common Shares
BEA (Advisor) Fund............................. $17 $52 $90 $195
Warburg Fund................................... $17 $52 $90 $195
- --------------------------------------------------------------------------------------------------------------------
Market Neutral Fund - Institutional Shares
BEA Fund....................................... $21 $63 N/A N/A
Warburg Fund................................... $21 $63 N/A N/A
Market Neutral Fund - Common Shares
BEA (Advisor) Fund............................. $23 $70 N/A N/A
Warburg Fund................................... $23 $70 N/A N/A
- --------------------------------------------------------------------------------------------------------------------
Long-Short Fund - Institutional Shares
BEA Fund....................................... $25 $78 N/A N/A
Warburg Fund................................... $25 $78 N/A N/A
Long-Short Fund - Common Shares
BEA (Advisor) Fund............................. $28 $85 N/A N/A
Warburg Fund................................... $28 $85 N/A N/A
- --------------------------------------------------------------------------------------------------------------------
Economic Value Fund - Institutional Shares
BEA Fund....................................... $10 $32 N/A N/A
Warburg Fund................................... $10 $32 N/A N/A
Economic Value Fund - Common Shares
BEA (Advisor) Fund............................. $13 $40 N/A N/A
Warburg Fund................................... $13 $40 N/A N/A
====================================================================================================================
</TABLE>
23
<PAGE> 34
The examples in the Fee Tables assume that all dividends and
distributions are reinvested.
The examples provide a means for the investor to compare expense
levels of funds with different fee structures over varying investment periods.
To facilitate such comparison, all funds are required to utilize a 5.00% annual
return assumption. However, each Fund's actual return will vary and may be
greater or less than 5.00%. THESE EXAMPLES SHOULD NOT BE CONSIDERED
REPRESENTATIONS OF PAST OR FUTURE EXPENSES AND ACTUAL EXPENSES MAY BE GREATER OR
LESS THAN THOSE SHOWN.
INFORMATION ABOUT THE REORGANIZATION
PLAN OF REORGANIZATION. The following summary of each Plan is
qualified in its entirety by reference to the form of Plan (Exhibit A hereto).
Each Plan provides that the relevant Warburg Fund will acquire all or
substantially all of the assets of the corresponding BEA Fund in exchange for
shares of the Warburg Fund and the assumption by the Warburg Fund of the
liabilities of the BEA Fund on the Closing Date. The Closing Date is expected to
be October 2, 1998 for all Funds except the BEA Long-Short Market Neutral Fund
and the BEA Long-Short Equity Fund for which the Closing Date is expected to be
October 23, 1998.
Prior to the Closing Date, the RBB Fund on behalf of each BEA Fund
will endeavor to discharge all of its known liabilities and obligations. The
Warburg Fund shall assume all liabilities, expenses, costs, charges and reserves
reflected on an unaudited statement of assets and liabilities of the
corresponding BEA Fund as of the close of regular trading on The New York Stock
Exchange, Inc., currently 4:00 p.m. New York City time, on the Closing Date, in
accordance with generally accepted accounting principles consistently applied
from the prior audited period. The Warburg Fund shall also assume any
liabilities of the corresponding BEA Fund arising from the operations and/or
transactions of the BEA Fund prior to and including the Closing Date. The net
asset value per share of each class of each Fund will be determined by addition
of the relevant class' pro rata share of the actual and accrued liabilities and
the liabilities specifically allocated to that class of shares, and dividing the
result by the total number of outstanding shares of the relevant class. Each BEA
Fund and the corresponding Warburg Fund will utilize the procedures set forth in
their respective current Prospectuses or Statements of Additional Information to
determine the value of their respective portfolio securities and to determine
the aggregate value of each Fund's portfolio.
On or as soon after the Closing Date as conveniently practicable,
each BEA Fund will liquidate and distribute pro rata to shareholders of record
as of the close of business on the Closing Date the shares of the same class of
the corresponding Warburg Fund received by the BEA Fund. Such liquidation and
distribution will be accomplished by the establishment of accounts in the names
of the BEA Fund's shareholders on the share records of the corresponding Warburg
Fund's transfer agent. Each account will represent the respective pro rata
number of shares of the class of shares of the corresponding Warburg Fund due to
each of
24
<PAGE> 35
the BEA Fund's shareholders. After such distribution and the winding up of its
affairs, each BEA Fund will be terminated as a series of the RBB Fund.
The consummation of the Reorganization is subject to the conditions
set forth in the Plan. Notwithstanding approval by the shareholders of a BEA
Fund, the Plan may be terminated with respect to a Reorganization at any time at
or prior to the Closing Date: (i) by mutual agreement of the RBB Fund, on behalf
of a BEA Fund, and the corresponding Warburg Fund; (ii) by the RBB Fund, on
behalf of a BEA Fund, in the event the corresponding Warburg Fund shall, or a
Warburg Fund, in the event the RBB Fund or the corresponding BEA Fund shall,
materially breach any representation, warranty or agreement contained in the
Plan to be performed at or prior to the Closing Date; or (iii) if a condition to
the Plan expressed to be precedent to the obligations of the terminating party
has not been met and it reasonably appears that it will not or cannot be met.
Pursuant to the Plan, each Warburg Fund has agreed to indemnify and
advance expenses to each director or officer of the RBB Fund against money
damages incurred in connection with any claim arising out of such person's
services as a director or officer with respect to matters specifically relating
to the corresponding BEA Fund. Each BEA Fund has obtained a rider for its
current directors and officers liability policy extending the period for making
claims under the policy until three years following the Closing Date. The
premium for the three-year period has been prepaid by the BEA Fund.
BEA has agreed to indemnify each person who served as a director or
officer of the RBB Fund at the Closing Date against any and all direct and
indirect liabilities, losses, claims, damages and expenses (including, without
limitation, reasonable attorneys' fees) (each, a "Loss") that arise from or
relate to the operations commencing on the first business day after the Closing
Date of the Warburg Funds, to the extent that a Loss has not been recovered
against the relevant Warburg Fund.
Approval of the Plan with respect to each BEA Fund will require the
affirmative vote of a majority of each BEA Fund's outstanding shares in the
aggregate without regard to class, in person or by proxy, if a quorum is
present. The approval of shareholders of any other RBB Fund or of shareholders
of the Warburg Funds is not required. Implementing the Reorganization by any one
BEA Fund would not be conditioned on receipt of shareholder approval by any
other BEA Fund. Shareholders of the BEA Funds are entitled to one vote for each
share. If the Reorganization is not approved by shareholders of a BEA Fund, the
Board of Directors of the RBB Fund on behalf of the applicable BEA Fund will
consider other possible courses of action available to it, including
resubmitting the Reorganization proposal to shareholders.
DESCRIPTION OF THE WARBURG FUNDS' SHARES. Shares of each Warburg
Fund will be issued to the corresponding BEA Fund in accordance with the
procedures detailed in the Plan and as described in the Warburg Fund's
Prospectuses. The Warburg Funds do not issue share certificates to shareholders.
See "Information on
25
<PAGE> 36
Shareholders' Rights" and the Prospectuses of the Warburg Funds for additional
information with respect to the shares of the Warburg Funds.
Each Warburg Fund has authorized three classes of common stock,
called Common Shares, Advisor Shares and Institutional Shares. Each Warburg Fund
intends to continuously offer Common Shares and Institutional Shares after the
Reorganization, except that the Warburg Telecommunications Fund does not
currently intend to offer Institutional Shares after the Reorganization. The
Institutional Shares of the Warburg Funds will be offered under the name "BEA
Institutional Funds." Although each Warburg Fund is authorized to offer Advisor
Shares in the future, none has any current intention of doing so. Individual
investors will only be able to purchase Advisor Shares through institutional
shareholders of record, broker-dealers, financial institutions, depository
institutions, retirement plans and financial intermediaries. Shares of each
class of each Warburg Fund will represent equal pro rata interests in the Fund
and accrue dividends and calculate net asset value and performance quotations in
the same manner. Because of the 12b-1 fees to be paid by the Advisor Shares and
the Common Shares, the total return on the Advisor Shares can be expected to be
lower than the total return on either the Common Shares or the Institutional
Shares, and the total return on the Common Shares can be expected to be lower
than the total return on the Institutional Shares.
FEDERAL INCOME TAX CONSEQUENCES. The exchange of assets of each BEA
Fund for shares of the corresponding Warburg Fund, followed by the distribution
of these shares, is intended to qualify for federal income tax purposes as a
tax-free reorganization under Section 368(a) of the Internal Revenue Code of
1986, as amended (the "Code"). As a condition to the closing of the
Reorganization, each Warburg Fund and the RBB Fund on behalf of the
corresponding BEA Fund will receive an opinion from Willkie Farr & Gallagher,
counsel to the Warburg Funds, to the effect that, on the basis of the existing
provisions of the Code, U.S. Treasury regulations issued thereunder, current
administrative rules, pronouncements and court decisions, for federal income tax
purposes, upon consummation of the Reorganization:
(1) the transfer of all or substantially all of each BEA Fund's
assets in exchange for the corresponding Warburg Fund's shares and the
assumption by the Warburg Fund of liabilities of the BEA Fund, and the
distribution of the Warburg Fund's shares to the shareholders of the BEA
Fund in exchange for their shares of the BEA Fund, will constitute a
"reorganization" within the meaning of Section 368(a) of the Code, and the
Warburg Fund and the BEA Fund will each be a "party to a reorganization"
within the meaning of Section 368(b) of the Code;
(2) no gain or loss will be recognized by each Warburg Fund upon the
receipt of the assets of the corresponding BEA Fund solely in exchange for
the Warburg Fund's shares and the assumption by the Warburg Fund of
liabilities of the BEA Fund;
26
<PAGE> 37
(3) no gain or loss will be recognized by each BEA Fund upon the
transfer of the BEA Fund's assets to the corresponding Warburg Fund in
exchange for the Warburg Fund's shares and the assumption by the Warburg
Fund of liabilities of the BEA Fund or upon the distribution of the
Warburg Fund's shares to the BEA Fund's shareholders;
(4) no gain or loss will be recognized by shareholders of each BEA
Fund upon the exchange of their shares for shares of the corresponding
Warburg Fund or upon the assumption by the Warburg Fund of liabilities of
the BEA Fund;
(5) the aggregate tax basis of the shares of each Warburg Fund
received by each shareholder of the corresponding BEA Fund pursuant to the
Reorganization will be the same as the aggregate tax basis of shares of
the BEA Fund held by such shareholder immediately prior to the
Reorganization, and the holding period of shares of the Warburg Fund to be
received by each shareholder of the BEA Fund will include the period
during which shares of the BEA Fund exchanged therefor were held by such
shareholder (provided shares of the BEA Fund were held as capital assets
on the date of the Reorganization); and
(6) the tax basis of each BEA Fund's assets acquired by the
corresponding Warburg Fund will be the same as the tax basis of such
assets to the BEA Fund immediately prior to the Reorganization, and the
holding period of the assets of the BEA Fund in the hands of the Warburg
Fund will include the period during which those assets were held by the
BEA Fund.
Shareholders of each BEA Fund should consult their tax advisors
regarding the effect, if any, of the proposed Reorganization in light of their
individual circumstances. Since the foregoing discussion only relates to the
federal income tax consequences of the Reorganization, shareholders of each BEA
Fund should also consult their tax advisors as to state and local tax
consequences, if any, of the Reorganization.
CAPITALIZATION. The following table shows the capitalization of each
BEA Fund as of June 30, 1998 and the corresponding Warburg Fund on a pro forma
basis as of the Closing Date, after giving effect to the Reorganization.
<TABLE>
<CAPTION>
BEA FUND WARBURG FUND
(UNAUDITED) (UNAUDITED)
----------- -----------
(IN THOUSANDS, EXCEPT PER SHARE VALUES)
<S> <C> <C>
INTERNATIONAL FUND
Net assets................................... $689,746,227
Net asset value per share
Common (Advisor) Share.................. $ 25.45
Institutional Share..................... $ 25.30
</TABLE>
27
<PAGE> 38
<TABLE>
<CAPTION>
BEA FUND WARBURG FUND
(UNAUDITED) (UNAUDITED)
----------- -----------
<S> <C> <C>
Shares outstanding
Common (Advisor) Share.................. 83,874
Institutional Share..................... 27,021,223
EMERGING MARKETS FUND
Net assets................................... $ 32,421,446
Net asset value per share
Common (Advisor) Share.................. $ 13.94
Institutional Share..................... $ 13.86
Shares outstanding
Common (Advisor) Share.................. 19,234
Institutional Share..................... 2,320,467
U.S. EQUITY FUND - Institutional Shares
Net assets................................... $105,980,093
Net asset value per share.................... $ 25.60
Shares outstanding........................... 4,140,104
U.S. FIXED INCOME FUND - Institutional Shares
Net assets................................... $287,991,501
Net asset value per share.................... $ 15.69
Shares outstanding........................... 18,352.865
GLOBAL INCOME FUND - Institutional Shares
Net assets................................... $ 28,406,408
Net asset value per share.................... $ 15.08
Shares outstanding........................... $ 1,884,015
HIGH YIELD FUND
Net assets................................... $103,205,423
Net asset value per share
Common (Advisor) Share.................. $ 17.48
Institutional Share..................... $ 17.48
Shares outstanding
Common (Advisor) Share.................. 233,461
Institutional Share..................... 5,669,604
</TABLE>
28
<PAGE> 39
<TABLE>
<CAPTION>
BEA FUND WARBURG FUND
(UNAUDITED) (UNAUDITED)
----------- -----------
<S> <C> <C>
MUNICIPAL FUND - Institutional Shares
Net assets................................... $21,452,889
Net asset value per share.................... $ 15.08
Shares outstanding........................... 1,422,218
TELECOMMUNICATIONS FUND - Common Shares
Net assets................................... $ 1,208,369
Net asset value per share.................... $ 25.18
Shares outstanding........................... 47,985
MARKET NEUTRAL FUND
Net assets................................... $ N/A
Net asset value per share
Common (Advisor) Share.................. $
Institutional Share..................... $
Shares outstanding
Common (Advisor) Share..................
Institutional Share.....................
LONG-SHORT FUND
Net assets................................... $ N/A
Net asset value per share
Common (Advisor) Share.................. $
Institutional Share..................... $
Shares outstanding
Common (Advisor) Share..................
Institutional Share.....................
ECONOMIC VALUE FUND
Net assets................................... $ N/A
Net asset value per share
Common (Advisor) Share.................. $
Institutional Share..................... $
Shares outstanding
Common (Advisor) Share..................
Institutional Share.....................
</TABLE>
29
<PAGE> 40
The Warburg Funds will not commence operations until consummation of
the Reorganization and, accordingly, as of the date of this combined
prospectus/proxy statement there were no outstanding shares of the Warburg
Funds.
SHARE OWNERSHIP OF BEA FUNDS
As of the Record Date, the officers and Directors of the RBB Fund
beneficially owned as a group, __% of the outstanding shares of BEA [INSERT]
Fund, __% of BEA [INSERT] Fund, __% of BEA [INSERT] Fund, __% of BEA [INSERT]
Fund, __% of BEA [INSERT] Fund, __% of BEA [INSERT] Fund, __% of BEA [INSERT]
Fund, __% of BEA [INSERT] Fund, and __% of BEA [INSERT] Fund. To the best
knowledge of the RBB Fund, as of the Record Date, no shareholder or "group" (as
that term is used in Section 13(d) of the Securities Exchange Act of 1934, as
amended (the "Exchange Act")), except as set forth in the table below, owned
beneficially or of record more than 5% of the outstanding shares of a class of a
BEA Fund.
<TABLE>
<CAPTION>
PERCENT OWNED AS
OF RECORD
DATE AND (AS OF
BEA FUND NAME AND ADDRESS CLOSING DATE)
<S> <C> <C>
</TABLE>
COMPARISON OF INVESTMENT OBJECTIVES AND POLICIES
The following discussion is based upon and qualified in its entirety
by the disclosures in the Prospectuses and Statements of Additional Information
of the Warburg Funds and the BEA Funds.
30
<PAGE> 41
INVESTMENT OBJECTIVES. As stated above each BEA Fund and its
corresponding Warburg Fund have the same investment objective. There can be no
assurance that any Fund will achieve its investment objective. The investment
objectives of the Warburg Funds, like those of the BEA Funds other than the BEA
Long-Short Market Neutral and Long-Short Equity Funds, may not be changed by the
Board of Directors without the affirmative vote of the holders of a majority of
the outstanding shares of the relevant Fund (as defined in the 1940 Act).
PRIMARY INVESTMENTS. The Warburg Funds were organized for the
purpose of acquiring the assets of the corresponding BEA Funds. In addition, the
investment policies and investment restrictions of the Warburg Funds were
developed so that they would be identical to those of the corresponding BEA
Funds, except that, unlike the BEA Funds, the Warburg Funds are not prohibited
from investing in an issuer of which the officers and directors of the Funds,
BEA or any subsidiary of either own more than 1/2 of 1% of the securities of
such issuer or more than 5% of the issuer's securities in the aggregate. This
had been a state law limitation which no longer applies to any mutual fund,
including the Warburg Fund. In addition, the Warburg Economic Value Fund's
investment restrictions on lending portfolio securities has been modified to
conform to that of all the other Warburg and BEA Funds. The impact of the change
is to reduce slightly the maximum amount of Fund securities that can be lent.
MANAGEMENT OF THE FUNDS
BEA will provide investment advisory services to each Warburg Fund
under an advisory agreement substantially similar to the advisory agreement
currently in effect between BEA and the RBB Fund relating to each BEA Fund. Each
of the Global Fixed Income and the Emerging Markets Funds will have Credit
Suisse Asset Management Limited ("CSAM") as an investment sub-adviser. CSAM, an
affiliate of BEA, is described in the Prospectuses for the relevant Warburg
Funds. (The specific persons at BEA and CSAM who will be responsible for the
day-to-day management of the Warburg Funds is described in the Prospectuses of
the Funds, which accompany this Combined Prospectus/Proxy Statement.)
In addition, (1) PFPC Inc. will continue to provide accounting and
co-administrative services as applicable, (2) CFSI will provide certain
co-administrative services, and (3) Counsellors Securities Inc. ("CSI") will
provide distribution services, all under new agreements substantially similar to
those now in effect for each BEA Fund. CSI had been distributor of the BEA Funds
until May 29, 1998, although since then the BEA Funds' distributor has been
Provident Distributors Inc. ("PDI"). CFSI will be co-administrator to both the
Common and Institutional classes of Warburg Funds, while (a) (since May 29,
1998) PDI has been administrative services agent for the Institutional Shares of
the BEA Funds, although all administrative services had been delegated to CFSI,
and (b) BEA is currently co-administrator of the Advisor shares of the BEA
Funds. Importantly, the advisory fees, co-administration fees and distribution
fees payable under the new agreements for the Warburg Funds in the aggregate
would not be changed as a result of the Reorganization. State Street Bank and
Trust Company will continue its role as shareholder servicing agent, transfer
agent and dividend disbursing agent after the Reorganization. Custodial Trust
Company will
31
<PAGE> 42
continue to serve as custodian of the assets of the Warburg Market Neutral Fund
and Warburg Long-Short Fund, and Brown Brothers Harriman & Co. will continue to
serve as custodian of the assets of the remaining Warburg Funds. The fees
payable for transfer agency and custodial services will be no higher after the
Reorganization than before. PricewaterhouseCoopers LLP, the auditors for the BEA
Funds, also serves in that capacity for the Warburg Funds.
INTEREST OF BEA IN THE REORGANIZATION
BEA may be deemed to have an interest in the Plan and the
Reorganization because it provides investment advisory services to the BEA
Funds. BEA receives compensation from the BEA Funds for services it provides
pursuant to advisory agreements. The terms and provisions of these arrangements
are described in the BEA Fund Prospectuses under "Management --Investment
Adviser." Future growth of assets of the Warburg Funds, if any, can be expected
to increase the total amount of fees payable to BEA and its affiliates and to
reduce the amount of fees and expenses required to be waived to maintain total
fees and expenses of the Warburg Funds at agreed upon levels. BEA may also be
deemed to have an interest in the Plan and the Reorganization because, as of the
Record Date, it or one or more of its affiliates possessed or shared voting
power or investment power as a beneficial owner or as a fiduciary on behalf of
its customers or employees in various BEA Funds (see "Information About the
Reorganization -- Share Ownership of BEA Funds" above). BEA and its affiliates
have advised the BEA Funds that they intend to vote the shares over which they
have voting power at the Meeting (i) in the manner instructed by the customers
for which such shares are held or (ii) in the event that such instructions are
not received or where shares are held directly or on behalf of employees, in the
same proportion as votes cast by other shareholders. See "Voting Information."
INTEREST OF WARBURG IN THE REORGANIZATION
Warburg may be deemed to have an interest in the Plan and Reorganization
because its affiliates, CSI and CFSI, will serve as the distributor and
co-administrator, respectively, for the new Warburg Funds. As such, CSI and CFSI
will receive compensation for their services. In addition, Mr. Arnold M.
Reichman, a director of both the RBB Fund and each Warburg Fund, is the chief
operating officer of Warburg Pincus Asset Management, Inc. and may indirectly
benefit from fees paid to Warburg affiliates. Further, Warburg may be deemed to
have an interest in the Plan and the Reorganization with respect to the Global
Telecommunications Fund because, as of the Record Date, one of Warburg's
affiliates was a beneficial owner of __% of the shares of that Fund. Warburg has
advised the BEA Funds that it intends to vote the shares over which it has
voting power at the Meeting in the same proportion as the votes cast by other
shareholders. See "Voting Information."
INFORMATION ON SHAREHOLDERS' RIGHTS
GENERAL. Each Warburg Fund is an open-end non-diversified management
investment company registered under the 1940 Act, which will continuously offer
to sell shares at their current net asset values. Each BEA Fund is a series of
the RBB Fund, which is
32
<PAGE> 43
a Maryland corporation that was incorporated on February 29, 1988 and is
governed by its Articles of Incorporation, By-Laws and Board of Directors. Each
Warburg Fund is a Maryland corporation organized in July, 1998 and is governed
by its Articles of Incorporation, By-Laws and Board of Directors. Each Fund is
also governed by applicable state and federal law. The RBB Fund has an
authorized capital of 30 billion shares of common stock with a par value of
$.001 per share. Each Warburg Fund has an authorized capital of three billion
shares of common stock with a par value of $.001 per share. The Board of
Directors of the RBB Fund has authorized the issuance of 96 series of shares,
each representing shares in one of 27 separate portfolios, and may authorize the
issuance of additional series of shares in the future. The assets of each
portfolio are segregated and separately managed and a shareholder's interest is
in the assets of the portfolio in which he or she holds shares. In each Warburg
Fund and each BEA Fund, shares represent interests in the assets of the relevant
Fund and have identical voting, dividend, liquidation and other rights on the
same terms and conditions except that expenses related to the distribution of
each class of shares of a Fund are borne solely by such class and each class of
shares has exclusive voting rights with respect to provisions of such Fund's
Rule 12b-1 distribution plan, if any, pertaining to a particular class.
MULTI-CLASS STRUCTURE. Although authorized to offer Common,
Institutional and Advisor shares, each Warburg Fund expects to offer, following
the Reorganization, only Common Shares and Institutional shares. Individual
investors may purchase Institutional Shares only if they have entered into an
investment management agreement with BEA or its affiliates, with certain
exceptions, as specified in the accompanying Prospectus.
DIRECTORS. The By-Laws of the RBB Fund and of each Warburg Fund
provide that the term of office of each Director shall be from the time of his
or her election and qualification until the next annual meeting of shareholders
and until his or her successor shall have been elected and shall have qualified.
Any Director of the RBB Fund or any Warburg Fund may be removed by the vote of
at least a majority of the shares of capital stock then entitled to be cast for
the election of Directors. Vacancies on the Boards of the RBB Fund or any
Warburg Fund may be filled by the Directors remaining in office. A meeting of
shareholders will be required for the purpose of electing additional Directors
whenever fewer than a majority of the Directors then in office were elected by
shareholders.
VOTING RIGHTS. Neither the RBB Fund nor any Warburg Fund holds a
meeting of shareholders annually, and there normally is no meeting of
shareholders for the purpose of electing Directors unless and until such time as
less than a majority of the Directors holding office have been elected by
shareholders.
LIQUIDATION OR TERMINATION. In the event of the liquidation or
termination of any of the investment funds of the RBB Fund or of any Warburg
Fund, the shareholders of the Fund are entitled to receive, when and as declared
by the Directors, the excess of the assets over the liabilities belonging to the
Fund. In either case, the assets so distributed to shareholders will be
distributed among the shareholders in proportion to the number of shares held by
them and recorded on the books of the fund.
33
<PAGE> 44
LIABILITY OF DIRECTORS. The Articles of Incorporation of each
Warburg Fund provide that the Directors and officers shall not be liable for
monetary damages for breach of fiduciary duty as a Director or officer, except
to the extent such exemption is not permitted by law. The Articles of
Incorporation of the RBB Fund and each Warburg Fund provide that the relevant
fund shall indemnify each Director and officer and permit advances for the
payment of expenses relating to the matter for which identification is sought,
each to the fullest extent permitted by Maryland General Corporation Law and
other applicable law. Pursuant to the Plan, each Warburg Fund extends this same
protection to current Directors and officers of the RBB Fund for liability
relating to the corresponding BEA Fund.
RIGHTS OF INSPECTION. Maryland law permits any shareholder of the
RBB Fund and of each Warburg Fund or any agent of such shareholder to inspect
and copy, during usual business hours, the By-Laws, minutes of shareholder
proceedings, annual statements of the affairs and voting trust agreements of the
RBB Fund and the Warburg Fund on file at its principal offices.
SHAREHOLDER LIABILITY. Under Maryland law, shareholders of the RBB
Fund and of each Warburg Fund do not have personal liability for corporate acts
and obligations. Shares of a Warburg Fund issued to the shareholders of the
corresponding BEA Fund in the Reorganization will be fully paid and
nonassessable when issued, transferable without restrictions and will have no
preemptive rights.
The foregoing is only a summary of certain characteristics of the
operations of the Warburg Funds and the RBB Fund on behalf of the BEA Funds. The
foregoing is not a complete description of the documents cited. Shareholders
should refer to the provisions of the corporate documents and state laws
governing each Fund for a more thorough description.
ADDITIONAL INFORMATION
Both the RBB Fund and the Warburg Funds are subject to the
informational requirements of the Exchange Act and the 1940 Act and in
accordance therewith file reports and other information including proxy
material, reports and charter documents, with the SEC. These materials can be
inspected and copies obtained at the Public Reference Facilities maintained by
the SEC at 450 Fifth Street, N.W., Washington, D.C. 20549 and at the New York
Regional Office of the SEC at 7 World Trade Center, Suite 1300, New York, New
York 10048. Copies of such material can also be obtained from the Public
Reference Branch, Office of Consumer Affairs and Information Services, SEC,
Washington, D.C. 20549 at prescribed rates. Prospectuses and Statements of
Additional Information for the Warburg Funds, along with related information,
may be found on the SEC website as well (http://www.sec.gov).
VOTING INFORMATION
This Combined Prospectus/Proxy Statement is furnished in connection
with a solicitation of proxies by the Board of Directors of the RBB Fund to be
used at the Special Meeting of Shareholders of the BEA Funds to be held at 3:00
p.m. on September 21, 1998, at
34
<PAGE> 45
the offices of The RBB Fund, Inc., 400 Bellevue Parkway, Wilmington, Delaware,
19809 and at any adjournment or adjournments thereof. This Combined
Prospectus/Proxy Statement, along with a Notice of the Meeting and proxy
card(s), is first being mailed to shareholders of the BEA Funds on or about
August __, 1998. Only shareholders of record as of the close of business on the
Record Date will be entitled to notice of, and to vote at, the Meeting or any
adjournment thereof. As of the Record Date, the BEA Funds had the following
shares outstanding and entitled to vote: BEA International Equity Fund:
[INSERT], BEA Emerging Markets Equity Fund: [INSERT], BEA U.S. Core Equity Fund:
[INSERT], BEA U.S. Core Fixed Income Fund: [INSERT], BEA Strategic Global Fixed
Income Fund: [INSERT], BEA High Yield Fund: [INSERT], BEA Municipal Bond Fund:
[INSERT], BEA Global Telecommunications Fund: [INSERT], BEA Long-Short Market
Neutral Fund: [INSERT], BEA Long-Short Equity Fund: [INSERT] and BEA Select
Economic Value Equity Fund: [INSERT]. The holders of one-third of the shares of
a BEA Fund outstanding at the close of business on the Record Date present in
person or represented by proxy will constitute a quorum for the Meeting of that
Fund. For purposes of determining a quorum for transacting business at the
Meeting, abstentions and broker "non-votes" (that is, proxies from brokers or
nominees indicating that such persons have not received instructions from the
beneficial owner or other persons entitled to vote shares on a particular matter
with respect to which the brokers or nominees do not have discretionary power)
will be treated as shares that are present but which have not been voted. For
this reason, abstentions and broker non-votes will have the effect of a "no"
vote for purposes of obtaining the requisite approval of the Plan. If the
enclosed proxy is properly executed and returned in time to be voted at the
Meeting, the proxies named therein will vote the shares represented by the proxy
in accordance with the instructions marked thereon. Unmarked proxies will be
voted FOR approval of the relevant Plan and FOR approval of any other matters
deemed appropriate. A proxy may be revoked at any time on or before the Meeting
by written notice to the Secretary of The RBB Fund, Inc., Bellevue Park
Corporate Center, 400 Bellevue Parkway, 3rd Floor, Wilmington, Delaware 19809.
Approval of the Plan with respect to each BEA Fund will require the
affirmative vote of a majority of each BEA Fund's outstanding shares, voting in
the aggregate without regard to class, in person or by proxy, if a quorum is
present. The approval of shareholders of any other investment series of the RBB
Fund is not required. Implementing the Reorganization by any one BEA Fund would
not be conditioned on receipt of shareholder approval by any other BEA Fund.
Shareholders of the BEA Funds are entitled to one vote for each share.
Proxy solicitations will be made primarily by mail, but proxy
solicitations also may be made by telephone, telegraph or personal interviews
conducted by officers and employees of BEA and its affiliates and/or by
MacKenzie Partners. All expenses of the Reorganization, including the costs of
the proxy solicitation and the preparation of enclosures to the Combined
Prospectus/Proxy Statement, reimbursement of expenses of forwarding solicitation
material to beneficial owners of shares of the BEA Funds and expenses incurred
in connection with the preparation of this Combined Prospectus/Proxy Statement
will be borne by BEA or its affiliates (excluding extraordinary expenses not
normally associated with
35
<PAGE> 46
transactions of this type). It is anticipated that banks, brokerage houses and
other institutions, nominees and fiduciaries will be requested to forward proxy
materials to beneficial owners and to obtain authorization for the execution of
proxies. BEA or its affiliates, may, upon request, reimburse banks, brokerage
houses and other institutions, nominees and fiduciaries for their expenses in
forwarding proxy materials to beneficial owners.
In the event that a quorum necessary for a shareholders' meeting is
not present or sufficient votes to approve the Reorganization of a BEA Fund are
not received by September 21, 1998, the persons named as proxies may propose one
or more adjournments of the Meeting to permit further solicitation of proxies.
In determining whether to adjourn the Meeting, the following factors may be
considered: the percentage of votes actually cast, the percentage of negative
votes actually cast, the nature of any further solicitation and the information
to be provided to shareholders with respect to the reasons for the solicitation.
Any such adjournment will require an affirmative vote by the holders of a
majority of the shares of the relevant BEA Fund present in person or by proxy
and entitled to vote at the Meeting. The persons named as proxies will vote upon
a decision to adjourn the Meeting with respect to a BEA Fund after consideration
of the best interests of all shareholders of that Fund.
As of the Record Date, BEA (or its affiliates) and an affiliate of
Warburg possessed or shared voting power or investment power as a fiduciary on
behalf of its customers, with respect to the shares of various BEA Funds as set
forth above under "Information About the Reorganization --Share Ownership of BEA
Funds."
36
<PAGE> 47
OTHER BUSINESS
The RBB Fund Board of Directors knows of no other business to be
brought before the Meeting. However, if any other matters come before the
Meeting, proxies that do not contain specific restrictions to the contrary will
be voted on such matters in accordance with the judgment of the persons named in
the enclosed Proxy Card.
The approval of shareholders of the Warburg Funds is not required in
order to affect the Reorganization and, accordingly, the votes of the
shareholders of the Warburg Funds are not being solicited by this Combined
Prospectus/Proxy Statement.
FINANCIAL STATEMENTS AND EXPERTS
The audited statement of net assets of each BEA Fund, other than the
BEA Long-Short Market Neutral, BEA Long-Short Equity and BEA Select Economic
Value Equity Funds, including the schedule of portfolio investments, as of
August 31, 1997, the related statements of operations for the year and/or period
then ended, the statement of changes in net assets for each of the two years and
period then ended and the financial highlights for each of the five years and
period then ended, have been incorporated by reference into this Combined
Prospectus/Proxy Statement in reliance upon the reports of
PricewaterhouseCoopers LLP, independent accountants, given on the authority of
such firm as experts in accounting and auditing.
The unaudited financial information contained in these Funds'
semi-annual report for the period ended February 28, 1998 is also incorporated
by reference. There is no financial information available at this time for the
Warburg Funds or for the BEA Long-Short Market Neutral, BEA Long-Short Equity
and BEA Select Economic Value Equity Fund, which had not commenced operations as
of February 28, 1998.
LEGAL MATTERS
Certain legal matters concerning the issuance of shares of the
Warburg Funds will be passed upon by Willkie Farr & Gallagher, 787 Seventh
Avenue, New York, New York 10019-6099, counsel to the Warburg Funds. In
rendering such opinion, Willkie Farr & Gallagher may rely on an opinion of
Venable Baetjer and Howard, L.L.P. as to certain matters under Maryland law.
37
<PAGE> 48
EXHIBIT A
FORM OF PLAN OF REORGANIZATION
A-1
<PAGE> 49
FORM OF AGREEMENT AND PLAN OF REORGANIZATION
THIS AGREEMENT AND PLAN OF REORGANIZATION (the "Agreement") is made as of
this ______th day of August, 1998, between and among each Warburg Pincus Fund
listed on Schedule A, each a Maryland corporation (the "Warburg Fund"), and The
RBB Fund, Inc., a Maryland corporation (the "RBB Fund"), on behalf of each
corresponding BEA Fund listed on Schedule A, each a series of shares of the RBB
Fund (the "BEA Fund") and, solely for purposes of Sections 9.2 and 9.3 hereof,
BEA Associates, a general partnership organized under the laws of the State of
New York.
This Agreement is intended to be and is adopted as a plan of
reorganization within the meaning of Section 368(a) of the United States
Internal Revenue Code of 1986, as amended (the "Code"). The reorganization of
each BEA Fund (collectively, the "Reorganization") will consist of the transfer
of substantially all of the assets of the BEA Fund in exchange solely for shares
of the applicable class or classes of common stock (collectively, the "Shares")
of the Warburg Fund corresponding thereto, as indicated in the table set forth
in Schedule A hereto, and the assumption by the Warburg Fund of liabilities of
the BEA Fund, and the distribution, on or after the Closing Date hereinafter
referred to, of Shares of the Warburg Fund ("Warburg Fund Shares") to the
shareholders of the BEA Fund in liquidation of the BEA Fund as provided herein,
all upon the terms and conditions hereinafter set forth in this Agreement.
WHEREAS, the Board of Directors of the RBB Fund on behalf of each BEA Fund
has determined that the exchange of all of the assets of the BEA Fund for
Warburg Fund Shares and the assumption of the liabilities of the BEA Fund by the
corresponding Warburg Fund is in the best interests of the RBB Fund and the BEA
Fund and that the interests of the existing shareholders of the RBB Fund and the
BEA Fund would not be diluted as a result of this transaction; and
WHEREAS, the Board of Directors of each Warburg Fund has determined that
the exchange of all of the assets of the BEA Fund for Warburg Fund Shares is in
the best interests of the Warburg Fund's shareholders and that the interests of
the existing shareholders of the Warburg Fund would not be diluted as a result
of this transaction.
NOW, THEREFORE, in consideration of the premises and of the covenants and
agreements hereinafter set forth, the parties hereto covenant and agree as
follows:
<PAGE> 50
1. TRANSFER OF ASSETS OF EACH BEA FUND IN EXCHANGE FOR WARBURG FUND SHARES
AND ASSUMPTION OF THE BEA FUND'S LIABILITIES AND LIQUIDATION OF THE BEA
FUND
1.1. Subject to the terms and conditions herein set forth and on the basis
of the representations and warranties contained herein, the RBB Fund agrees to
transfer each BEA Fund's assets as set forth in paragraph 1.2 to the
corresponding Warburg Fund, and the Warburg Fund agrees in exchange therefor:
(i) to deliver to the RBB Fund the number of Warburg Fund Shares, including
fractional Warburg Fund Shares, of each class of each BEA Fund determined by
dividing the value of the BEA Fund's net assets attributable to each such class
of shares, computed in the manner and as of the time and date set forth in
paragraph 2.1, by the offering price of one Warburg Fund Share of the same
class; and (ii) to assume the liabilities of the BEA Fund, as set forth in
paragraph 1.3. Such transactions shall take place at the closing provided for in
paragraph 3.1 (the "Closing").
1.2. (a) The assets of each BEA Fund to be acquired by the corresponding
Warburg Fund shall consist of all property including, without limitation, all
cash, securities and dividend or interest receivables that are owned by the BEA
Fund and any deferred or prepaid expenses shown as an asset on the books of the
BEA Fund on the closing date provided in paragraph 3.1 (the "Closing Date").
(b) The RBB Fund, on behalf of each BEA Fund, has provided the
corresponding Warburg Fund with a list of all of the BEA Fund's assets as of the
date of execution of this Agreement. The RBB Fund, on behalf of each BEA Fund,
reserves the right to sell any of these securities but will not, without the
prior approval of the corresponding Warburg Fund, acquire any additional
securities other than securities of the type in which the Warburg Fund is
permitted to invest. The RBB Fund, on behalf of each BEA Fund, will, within a
reasonable time prior to the Closing Date, furnish the corresponding Warburg
Fund with a list of the securities, if any, on the BEA Fund's list referred to
in the first sentence of this paragraph which do not conform to the Warburg
Fund's investment objectives, policies and restrictions. In the event that any
BEA Fund holds any investments which the corresponding Warburg Fund may not
hold, such BEA Fund will dispose of such securities prior to the Closing Date.
In addition, if it is determined that the portfolios of a BEA Fund and the
corresponding Warburg Fund, when aggregated, would contain investments exceeding
certain percentage limitations imposed upon the Warburg Fund with respect to
such investments, the BEA Fund, if requested by the Warburg Fund, will dispose
of and/or reinvest a sufficient amount of such investments as may be necessary
to avoid violating such limitations as of the Closing Date.
1.3. The RBB Fund, on behalf of each BEA Fund, will endeavor to discharge
all the BEA Funds' known liabilities and
2
<PAGE> 51
obligations prior to the Closing Date, other than those liabilities and
obligations which would otherwise be discharged at a later date in the ordinary
course of business. Each Warburg Fund shall assume all liabilities, expenses,
costs, charges and reserves, including those liabilities reflected on an
unaudited statement of assets and liabilities of the corresponding BEA Fund
prepared by PFPC Inc., as of the Valuation Date (as defined in paragraph 2.1),
in accordance with generally accepted accounting principles consistently applied
from the prior audited period. Each Warburg Fund shall also assume any
liabilities, expenses, costs or charges incurred by or on behalf of the
corresponding BEA Fund specifically arising from or relating to the operations
and/or transactions of the BEA Fund prior to and including the Closing Date but
which are not reflected on the above-mentioned statement of assets and
liabilities, including any liabilities, expenses, costs or charges arising under
paragraph 5.10 hereof.
1.4. As provided in paragraph 3.4, as soon on or after the Closing Date as
is conveniently practicable (the "Liquidation Date"), each BEA Fund will
liquidate and distribute pro rata to the BEA Fund's shareholders of record
determined as of the close of business on the Closing Date (the "BEA Fund
Shareholders") the Warburg Fund Shares it receives pursuant to paragraph 1.1.
Such liquidation and distribution will be accomplished by the transfer of the
Warburg Fund Shares then credited to the account of the BEA Fund on the books of
the corresponding Warburg Fund to open accounts on the share records of the
Warburg Fund in the name of the BEA Fund's shareholders representing the
respective pro rata number of the Warburg Fund Shares of the particular class
due such shareholders. All issued and outstanding shares of the BEA Fund will
simultaneously be canceled on the books of the RBB Fund, although share
certificates representing interests in the BEA Fund will represent a number of
Warburg Fund Shares after the Closing Date as determined in accordance with
Section 2.3. The Warburg Fund shall not issue certificates representing the
Warburg Fund Shares in connection with such exchange.
1.5. Ownership of Warburg Fund Shares will be shown on the books of each
Warburg Fund's transfer agent. Shares of each Warburg Fund will be issued in the
manner described in the Warburg Fund's current prospectuses and statement of
additional information.
1.6. Any transfer taxes payable upon issuance of the Warburg Fund Shares
in a name other than the registered holder of the BEA Fund Shares on the books
of the BEA Fund as of that time shall, as a condition of such issuance and
transfer, be paid by the person to whom such Warburg Fund Shares are to be
issued and transferred.
1.7. Any reporting responsibility of a BEA Fund is and shall remain the
responsibility of the RBB Fund up to and including the applicable Closing Date
and such later dates on which the BEA Fund is terminated.
3
<PAGE> 52
2. VALUATION
2.1. The value of each BEA Fund's assets to be acquired hereunder shall be
the value of such assets computed as of the close of regular trading on the New
York Stock Exchange, Inc. (the "NYSE") on the applicable Closing Date (such time
and date being hereinafter called the "Valuation Date"), using the valuation
procedures set forth in the BEA Fund's then current prospectuses or statement of
additional information.
2.2. The number of Shares of each class of a Warburg Fund to be issued
(including fractional shares, if any) in exchange for the corresponding BEA
Fund's net assets shall be determined by dividing the value of the net assets of
the BEA Fund attributable to the respective classes of Shares determined using
the same valuation procedures referred to in paragraph 2.1 by the offering price
per Share of such class of the Warburg Fund.
2.3. All computations of value shall be made by PFPC Inc. in accordance
with its regular practice as pricing agent for each BEA Fund and Warburg Fund,
respectively.
3. CLOSING AND CLOSING DATE
3.1. The Closing Date for the Reorganization shall be October 2, 1998
(except that, with respect to the Reorganizations for the BEA Long-Short Market
Neutral Fund and the BEA Long-Short Equity Fund, the Closing Date shall be
October 23, 1998), or such other date as the parties to such Reorganization may
agree to in writing. All acts taking place at the Closing shall be deemed to
take place simultaneously as of the close of trading on the New York Stock
Exchange on the Closing Date unless otherwise provided. The Closing shall be
held as of 4:00 p.m., at the offices of PFPC Inc., 400 Bellevue Parkway,
Wilmington, Delaware 19809, or at such other time and/or place as the parties
may agree.
3.2. The custodian for each Warburg Fund (the "Custodian") shall deliver
at the Closing a certificate of an authorized officer stating that: (a) the
corresponding BEA Fund's portfolio securities, cash and any other assets have
been delivered in proper form to the Warburg Fund on the Closing Date and (b)
all necessary taxes, including all applicable federal and state stock transfer
stamps, if any, have been paid, or provision for payment has been made, in
conjunction with the delivery of portfolio securities.
3.3. In the event that on the Valuation Date (a) the NYSE or another
primary trading market for portfolio securities of a Warburg Fund or a BEA Fund
shall be closed to trading or trading thereon shall be restricted or (b) trading
or the reporting of trading on the NYSE or elsewhere shall be disrupted so that
accurate appraisal of the value of the net assets of a Warburg Fund or a BEA
Fund is impracticable, the applicable Closing Date
4
<PAGE> 53
shall be postponed until the first business day after the day when trading shall
have been fully resumed and reporting shall have been restored.
3.4. The RBB Fund, on behalf of each BEA Fund, shall deliver at the
Closing a list of the names and addresses of the BEA Fund's shareholders and the
number and class of outstanding Shares owned by each such shareholder
immediately prior to the Closing or provide evidence that such information has
been provided to the corresponding Warburg Fund's transfer agent. Each Warburg
Fund shall issue and deliver a confirmation evidencing the Warburg Fund Shares
to be credited to the corresponding BEA Fund's account on the Closing Date to
the Secretary of the RBB Fund or provide evidence satisfactory to the RBB Fund
that such Warburg Fund Shares have been credited to the BEA Fund's account on
the books of the Warburg Fund. At the Closing, each party shall deliver to the
relevant other parties such bills of sale, checks, assignments, share
certificates, if any, receipts or other documents as such other party or its
counsel may reasonably request.
4. REPRESENTATIONS AND WARRANTIES
4.1. The RBB Fund, on behalf of each BEA Fund, represents and warrants to
the Warburg Fund as follows:
(a) The RBB Fund is a Maryland corporation duly organized, validly
existing and in good standing under the laws of the State of Maryland and each
BEA Fund is a validly existing series of shares of the RBB Fund representing
interests in the BEA Fund under the laws of the State of Maryland;
(b) The RBB Fund is a registered investment company classified as a
management company of the open-end type and its registration with the Securities
and Exchange Commission (the "Commission") as an investment company under the
Investment Company Act of 1940, as amended (the "1940 Act"), is in full force
and effect;
(c) The RBB Fund is not, and the execution, delivery and performance of
this Agreement will not result, in a violation of its Charter or By-Laws or any
material agreement, indenture, instrument, contract, lease or other undertaking
to which the RBB Fund on behalf of any BEA Fund is a party or by which the RBB
Fund or any BEA Fund or the property of any of them is bound or affected;
(d) There are no contracts or other commitments (other than this
Agreement) of the RBB Fund on behalf of any BEA Fund which will be terminated
with liability to the BEA Fund prior to the Closing Date;
(e) Except as previously disclosed in writing to and accepted by the
relevant Warburg Fund, no litigation or
5
<PAGE> 54
administrative proceeding or investigation of or before any court or
governmental body is presently pending or to its knowledge threatened against a
BEA Fund or any of its properties or assets which, if adversely determined,
would materially and adversely affect its financial condition or the conduct of
its business. The RBB Fund knows of no facts which might form the basis for the
institution of such proceedings and is not party to or subject to the provisions
of any order, decree or judgment of any court or governmental body which
materially and adversely affects its business or the business of the BEA Fund or
its ability to consummate the transactions herein contemplated;
(f) The statements of assets and liabilities of the BEA Fund for each of
the fiscal years ended August 31 in the period beginning with commencement of
the BEA Fund and ending August 31, 1997 have been audited by
PricewaterhouseCoopers LLP, certified public accountants, and are in accordance
with generally accepted accounting principles consistently applied, and such
statements (copies of which have been furnished to the corresponding Warburg
Fund) fairly reflect the financial condition of the BEA Fund as of such dates,
and there are no known contingent liabilities of the BEA Fund as of such dates
not disclosed therein;
(g) Since August 31, 1997, there has not been any material adverse change
in the BEA Fund's financial condition, assets, liabilities or business other
than changes occurring in the ordinary course of business, or any incurrence by
the BEA Fund of indebtedness maturing more than one year from the date that such
indebtedness was incurred, except as otherwise disclosed to and accepted by the
corresponding Warburg Fund. For the purposes of this subparagraph (g), a decline
in net asset value per share or the total assets of the BEA Fund in the ordinary
course of business shall not constitute a material adverse change;
(h) At the Closing Date, all federal and other tax returns and reports of
each BEA Fund required by law to have been filed by such dates shall have been
filed, and all federal and other taxes shall have been paid so far as due, or
provision shall have been made for the payment thereof and, to the best of the
RBB Fund's knowledge, no such return is currently under audit and no assessment
has been asserted with respect to such returns;
(i) For the most recent fiscal year of its operation, the BEA Fund has met
the requirements of Subchapter M of the Code for qualification and treatment as
a regulated investment company; all of the BEA Fund's issued and outstanding
shares have been offered and sold in compliance in all material respects with
applicable federal and state securities laws;
(j) All issued and outstanding shares of each class of the BEA Fund are,
and at the applicable Closing Date will be, duly and validly issued and
outstanding, fully paid and non-assessable by the RBB Fund. All of the issued
and outstanding shares of the BEA Fund will, at the time of Closing, be held by
the persons and
6
<PAGE> 55
the amounts set forth in the records of the transfer agent as provided in
paragraph 3.4. The BEA Fund does not have outstanding any options, warrants or
other rights to subscribe for or purchase any of the BEA Fund's shares, nor is
there outstanding any security convertible into any of the BEA Fund's shares;
(k) At the applicable Closing Date, the RBB Fund will have good and
marketable title to the BEA Fund's assets to be transferred to the corresponding
Warburg Fund pursuant to paragraph 1.2 and full right, power and authority to
sell, assign, transfer and deliver such assets hereunder and, upon delivery and
payment for such assets, the Warburg Fund will acquire good and marketable title
thereto, subject to no restrictions on the full transfer thereof, except such
restrictions as might arise under the Securities Act of 1933, as amended (the
"1933 Act") with respect to privately placed or otherwise restricted securities
that the BEA Fund may have acquired in the ordinary course of business;
(l) The execution, delivery and performance of this Agreement has been
duly authorized by all necessary actions on the part of the RBB Fund's Board of
Directors, and subject to the approval of the BEA Fund's shareholders, this
Agreement will constitute a valid and binding obligation of the RBB Fund,
enforceable in accordance with its terms, subject to the effect of bankruptcy,
insolvency, fraudulent conveyance, reorganization, moratorium and other laws
relating to or affecting creditors' rights and to general equity principles;
(m) Insofar as the following relate to the RBB Fund or any BEA Fund, the
registration statement filed by the Warburg Fund on Form N-14 relating to
Warburg Fund Shares that will be registered with the Commission pursuant to this
Agreement, which, without limitation, shall include a proxy statement of the RBB
Fund and the prospectuses of each Warburg Fund with respect to the transactions
contemplated by this Agreement, and any supplement or amendment thereto, and the
documents contained or incorporated therein by reference (the "N-14 Registration
Statement"), on the effective date of the N-14 Registration Statement, at the
time of any shareholders' meeting referred to herein, on the Valuation Date and
on the Closing Date: (i) shall comply in all material respects with the
provisions of the 1933 Act, the 1934 Act and the 1940 Act and the rules and
regulations under those Acts, and (ii) shall not contain any untrue statement of
a material fact or omit to state a material fact required to be stated therein
or necessary to make the statements therein not misleading.
4.2. Each Warburg Fund represents and warrants to the RBB Fund as follows:
(a) The Warburg Fund is a Maryland corporation, duly organized, validly
existing and in good standing under the laws of the State of Maryland;
7
<PAGE> 56
(b) The Warburg Fund is a registered investment company classified as a
management company of the open-end type and its registration with the Commission
as an investment company under the 1940 Act is in full force and effect;
(c) The current prospectuses and statement of additional information filed
as part of the Warburg Fund registration statement on Form N-1A (the "Warburg
Fund Registration Statement") conform in all material respects to the applicable
requirements of the 1933 Act and the 1940 Act and the rules and regulations of
the Commission under those Acts and do not include any untrue statement of a
material fact or omit to state any material fact required to be stated therein
or necessary to make the statements therein, in light of the circumstances under
which they were made, not materially misleading;
(d) At the Closing Date, the Warburg Fund will have good and marketable
title to its assets;
(e) The Warburg Fund is not, and the execution, delivery and performance
of this Agreement will not result in, a violation of its Charter or By-Laws or
any material agreement, indenture, instrument, contract, lease or other
undertaking to which the Warburg Fund is a party or by which it is bound;
(f) Except as previously disclosed in writing to and accepted by the RBB
Fund, no litigation or administrative proceeding or investigation of or before
any court or governmental body is presently pending or to its knowledge
threatened against the Warburg Fund or any of its properties or assets which, if
adversely determined, would materially and adversely affect its financial
condition or the conduct of its business. The Warburg Fund knows of no facts
which might form the basis for the institution of such proceedings and is not a
party to or subject to the provisions of any order, decree or judgment of any
court or governmental body which materially and adversely affects its business
or its ability to consummate the transactions contemplated herein;
(g) Since the inception of the Warburg Fund there has not been any
material adverse change with respect to the Warburg Fund's financial condition,
assets or liabilities;
(h) At the Closing Date, all federal and other tax returns and reports of
the Warburg Fund required by law then to be filed shall have been filed, and all
federal and other taxes shown as due on said returns and reports shall have been
paid or provision shall have been made for the payment thereof;
(i) The Warburg Fund intends to meet the requirements of Subchapter M of
the Code for qualification and treatment as a regulated investment company in
the future;
8
<PAGE> 57
(j) At the date hereof, all issued and outstanding Warburg Fund Shares
are, and at the Closing Date will be, duly and validly issued and outstanding,
fully paid and non-assessable, with no personal liability attaching to the
ownership thereof. The Warburg Fund does not have outstanding any options,
warrants or other rights to subscribe for or purchase any Warburg Fund Shares,
nor is there outstanding any security convertible into any Warburg Fund Shares;
(k) The execution, delivery and performance of this Agreement has been
duly authorized by all necessary actions on the part of the Warburg Fund's Board
of Directors, and this Agreement will constitute a valid and binding obligation
of the Warburg Fund enforceable in accordance with its terms, subject to the
effect of bankruptcy, insolvency, fraudulent conveyance, reorganization,
moratorium and other laws relating to or affecting creditors' rights and to
general equity principles;
(l) The Warburg Fund Shares to be issued and delivered to the
corresponding BEA Fund, for the account of the BEA Fund's shareholders, pursuant
to the terms of this Agreement, will at the Closing Date have been duly
authorized and when so issued and delivered, will be duly and validly issued
Warburg Fund Shares, and will be fully paid and non-assessable with no personal
liability attaching to the ownership thereof;
(m) Insofar as the following relate to the Warburg Fund, the N-14
Registration Statement, on the effective date of the N-14 Registration
Statement, at the time of any shareholders' meeting referred to herein, on the
Valuation Date and on the Closing Date: (i) shall comply in all material
respects with the provisions of the 1933 Act, the 1934 Act and the 1940 Act and
the rules and regulations under those Acts, and (ii) shall not contain any
untrue statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein not misleading.
(n) The Warburg Fund agrees to use all reasonable efforts to obtain the
approvals and authorizations required by the 1933 Act, the 1940 Act and such of
the state Blue Sky or securities laws as it may deem appropriate in order to
continue its operations after the Closing Date.
5. COVENANTS OF THE RBB FUND ON BEHALF OF EACH BEA FUND AND EACH WARBURG FUND
5.1. Each Warburg Fund and each BEA Fund will operate its business in the
ordinary course between the date hereof and the Closing Date. It is understood
that such ordinary course of business will include the declaration and payment
of customary dividends and distributions.
5.2. The RBB Fund, on behalf of each BEA Fund, will call a meeting of its
shareholders to consider and act upon this
9
<PAGE> 58
Agreement and to take all other actions in coordination with the BEA Fund
necessary to obtain approval of the transactions contemplated herein.
5.3. The RBB Fund, on behalf of each BEA Fund, covenants that the Warburg
Fund Shares to be issued hereunder are not being acquired for the purpose of
making any distribution thereof other than in accordance with the terms of this
Agreement.
5.4. The RBB Fund, on behalf of each BEA Fund, will assist the
corresponding Warburg Fund in obtaining such information as the Warburg Fund
reasonably requests concerning the beneficial ownership of the BEA Fund's
Shares.
5.5. Subject to the provisions of this Agreement, each Warburg Fund and
the RBB Fund each will take, or cause to be taken, all action, and do or cause
to be done, all things reasonably necessary, proper or advisable to consummate
and make effective the transactions contemplated by this Agreement.
5.6. The RBB Fund, on behalf of each BEA Fund, will provide the
corresponding Warburg Fund with information reasonably necessary for the
preparation of a prospectus (the "Prospectus") which will include the Proxy
Statement referred to in paragraph 4.1(n), all to be included in the N-14
Registration Statement, in compliance with the 1933 Act, the Securities Exchange
Act of 1934 (the "1934 Act") and the 1940 Act in connection with the meeting of
the RBB Fund's shareholders to consider approval of this Agreement and the
transactions contemplated herein.
5.7. The RBB Fund, on behalf of each BEA Fund, will provide the
corresponding Warburg Fund with information reasonably necessary for the
preparation of the Warburg Fund Registration Statement.
5.8. As promptly as practicable, but in any case within thirty days of the
Closing Date, the RBB Fund shall furnish each Warburg Fund with a statement
containing information required for purposes of complying with Rule 24f-2 under
the 1940 Act. A notice pursuant to Rule 24f-2 will be filed by the Warburg Fund
offsetting redemptions by the corresponding BEA Fund during the fiscal year
ending on or after the applicable Closing Date against sales of Warburg Fund
Shares and the RBB Fund agrees that it will not net redemptions during such
period by any BEA Fund against sales of shares of any other series of the RBB
Fund.
5.9. Each Warburg Fund agrees to indemnify and advance expenses to each
person who at the time of the execution of this Agreement serves as a Director
or Officer ("Indemnified Person") of the RBB Fund, against money damages
actually and reasonably incurred by such Indemnified Person in connection with
any claim that is asserted against such Indemnified Person arising out of such
person's service as a director or officer of the RBB Fund
10
<PAGE> 59
with respect to matters specifically relating to the corresponding BEA Fund,
provided that such indemnification and advancement of expenses shall be
permitted to the fullest extent that is available under the Maryland General
Corporation law and other applicable law. This paragraph 5.9 shall not protect
any such Indemnified Person against any liability to a BEA Fund, the
corresponding Warburg Fund or their shareholders to which he would otherwise be
subject by reason of willful misfeasance, bad faith, gross negligence or from
reckless disregard of the duties involved in the conduct of his office. An
Indemnified Person seeking indemnification shall be entitled to advances from a
Warburg Fund for payment of the reasonable expenses incurred by him in
connection with the matter as to which he is seeking indemnification in the
manner and to the fullest extent permissible under the Maryland General
Corporation law and other applicable law. Such Indemnified Person shall provide
to the Warburg Fund a written affirmation of his good faith belief that the
standard of conduct necessary for indemnification by the Warburg Fund has been
met and a written undertaking to repay any advance if it should ultimately be
determined that the standard of conduct has not been met. In addition, at least
one of the following additional conditions shall be met: (a) the Indemnified
Person shall provide security in form and amount acceptable to the Warburg Fund
for its undertaking; (b) the Warburg Fund is insured against losses arising by
reason of the advance; or (c) either a majority of a quorum of disinterested
non-party directors of the Warburg Fund (collectively, the "Disinterested
Directors"), or independent legal counsel experienced in mutual fund matters,
selected by the Indemnified Person, in a written opinion, shall have determined,
based on a review of facts readily available to the Warburg Fund at the time the
advance is proposed to be made, that there is reason to believe that the
Director will ultimately be found to be entitled to indemnification.
5.10. Each Warburg Fund agrees to take no action that would adversely
affect the qualification of the Reorganization as a reorganization under Section
368(a) of the Code. In this regard, each Warburg Fund covenants that, following
the Reorganization, it (a) will (i) continue the historic business of the BEA
Fund or (ii) use a significant portion of the BEA Fund's historic business
assets in a business, and (b) will not sell or otherwise dispose of any of the
assets of the BEA Fund, except for dispositions in the ordinary course of
business or transfers to a corporation (or other entity classified for federal
income tax purposes as an association taxable as a corporation) that is
"controlled" by the Warburg Fund within the meaning of Section 368(c) of the
Code.
6. CONDITIONS PRECEDENT TO OBLIGATIONS OF EACH BEA FUND
The obligations of the RBB Fund to consummate the transactions provided
for herein with respect to each BEA Fund shall be subject, at its election, to
the performance by the
11
<PAGE> 60
corresponding Warburg Fund of all of the obligations to be performed by it
hereunder on or before the Closing Date and, in addition thereto, the following
further conditions:
6.1. All representations and warranties of the corresponding Warburg Fund
contained in this Agreement shall be true and correct in all material respects
as of the date hereof and, except as they may be affected by the actions
contemplated by this Agreement, as of the Closing Date with the same force and
effect as if made on and as of the Closing Date;
6.2. The Warburg Fund shall have delivered to the RBB Fund a certificate
executed in its name by its President or Vice President and its Secretary,
Treasurer or Assistant Treasurer, in a form reasonably satisfactory to the RBB
Fund and dated as of the Closing Date, to the effect that the representations
and warranties of the Warburg Fund made in this Agreement are true and correct
at and as of the Closing Date, except as they may be affected by the
transactions contemplated by this Agreement and as to such other matters as the
RBB Fund shall reasonably request;
6.3. The RBB Fund shall have received written agreements from BEA
Associates (together with Counsellors Funds Service, Inc. with respect to the
former Advisor class of each BEA Fund's shares outstanding on the Closing Date)
to maintain, for a one year period from the Closing Date, the average expense
ratios of each such class of shares for the thirty days ending on the Closing
Date. These expense ratios will be in effect except for increases in expense
ratios due to redemptions of shares outside of the ordinary course of business;
and
6.4. The RBB Fund shall have received on the Closing Date a favorable
opinion from Willkie Farr & Gallagher, counsel to each Warburg Fund, dated as of
the Closing Date, in a form reasonably satisfactory to the RBB Fund, covering
the following points:
That (a) the Warburg Fund is a validly existing corporation and in good
standing under the laws of the State of Maryland, has the corporate power to own
all of its properties and assets and to carry on its business as a registered
investment company; (b) the Agreement has been duly authorized, executed and
delivered by the Warburg Fund and, assuming due authorization, execution and
delivery of the Agreement by the other parties thereto, is a valid and binding
obligation of the Warburg Fund enforceable against the Warburg Fund in
accordance with its terms, subject to the effect of bankruptcy, insolvency,
fraudulent conveyance, reorganization, moratorium and other laws relating to or
affecting creditors' rights generally and to general equity principles; (c) the
Warburg Fund Shares to be issued to the corresponding BEA Fund's shareholders as
provided by this Agreement are duly authorized and upon such delivery will be
validly issued and outstanding and are fully paid and
12
<PAGE> 61
nonassessable with no personal liability attaching to ownership thereof, and no
shareholder of the Warburg Fund has any preemptive rights to subscription or
purchase in respect thereof; (d) the execution and delivery of this Agreement
did not, and the consummation of the transactions contemplated hereby will not,
result in a violation of the Warburg Fund's Charter or By-Laws or in a material
violation of any provision of any agreement (known to such counsel) to which the
Warburg Fund is a party or by which it or its property is bound or, to the
knowledge of such counsel, result in the acceleration of any obligation or the
imposition of any penalty, under any agreement, judgment, or decree to which the
Warburg Fund is a party or by which it or its property is bound; (e) to the
knowledge of such counsel, no consent, approval, authorization or order of any
court or governmental authority of the United States or state of Maryland is
required for the consummation by the Warburg Fund of the actions contemplated
herein, except such as have been obtained under the 1933 Act, the 1934 Act and
the 1940 Act, and such as may be required under state securities laws; (f) only
insofar as they relate to the Warburg Fund, the descriptions in the Proxy
Statement of statutes, legal and governmental proceedings, investigations,
orders, decrees or judgments of any court or governmental body in the United
States and contracts and other documents, if any, are accurate and fairly
present the information required to be shown; (g) such counsel does not know of
any legal, administrative or governmental proceedings, investigation, order,
decree or judgment of any court or governmental body, only insofar as they
relate to the Warburg Fund or its assets or properties, pending, threatened or
otherwise existing on or before the effective date of the Registration Statement
or the Closing Date, which are required to be described in the Registration
Statement or to be filed as exhibits to the Registration Statement which are not
described and filed as required; (h) the Warburg Fund is registered as an
investment company under the 1940 Act and its registration with the Commission
as an investment company under the 1940 Act is in full force and effect; (i) the
Proxy Statement and the Warburg Fund Registration Statement (except as to
financial and statistical data contained therein, as to which no opinion need be
given) comply as to form in all material respects with the requirements of the
1933 Act, the 1934 Act and the 1940 Act and the rules and regulations
thereunder; and (j) the Warburg Fund Registration Statement is effective under
the 1933 Act and the 1940 Act and no stop-order suspending its effectiveness or
order pursuant to section 8(e) of the 1940 Act has been issued.
In addition, such counsel also shall state that they have participated in
conferences with officers and other representatives of the Warburg Fund at which
the contents of the Proxy Statement, the Warburg Fund Registration Statement and
related matters were discussed and, although they are not passing upon and do
not assume any responsibility for the accuracy, completeness or fairness of the
statements contained in the Proxy Statement and the Warburg Fund Registration
Statement (except to
13
<PAGE> 62
the extent indicated in paragraph (f) of their above opinion), on the basis of
the foregoing (relying as to materiality to a large extent upon the opinions of
officers and other representatives of the Warburg Fund), they do not believe
that the Proxy Statement and the Warburg Fund Registration Statement as of their
respective dates, as of the date of the BEA Fund shareholders' meeting, and as
of the Closing Date, contained an untrue statement of a material fact or omitted
to state a material fact required to be stated therein regarding the Warburg
Fund or necessary to make the statements therein regarding the Warburg Fund, in
the light of the circumstances under which they were made, not misleading.
Such opinion may state that such counsel does not express any opinion or
belief as to the financial statements or other financial data or as to the
information relating to the BEA Fund, contained in the Proxy Statement, N-14
Registration Statement or Warburg Fund Registration Statement, and that such
opinion is solely for the benefit of the RBB Fund, its Directors and its
officers. Such counsel may rely as to matters governed by the laws of the state
of Maryland on an opinion of Maryland counsel and/or certificates of officers or
directors of each Warburg Fund. Such opinion also shall include such other
matters incident to the transaction contemplated hereby, as the BEA Fund may
reasonably request.
In this paragraph 6.4, references to the Proxy Statement include and
relate only to the text of such Proxy Statement and not, except as specifically
stated above, to any exhibits or attachments thereto or to any documents
incorporated by reference therein.
7. CONDITIONS PRECEDENT TO OBLIGATIONS OF EACH WARBURG FUND
The obligations of each Warburg Fund to complete the transactions provided
for herein shall be subject, at its election, to the performance by the RBB Fund
on behalf of the corresponding BEA Fund of all the obligations to be performed
by it hereunder on or before the Closing Date and, in addition thereto, the
following conditions:
7.1. All representations and warranties of the RBB Fund contained in this
Agreement shall be true and correct in all material respects as of the date
hereof and, except as they may be affected by the transactions contemplated by
this Agreement, as of the Closing Date with the same force and effect as if made
on and as of the Closing Date;
7.2. The RBB Fund shall have delivered to the Warburg Fund a statement of
the BEA Fund's assets and liabilities as of the Closing Date, certified by the
Treasurer or Assistant Treasurer of the RBB Fund;
14
<PAGE> 63
7.3. The RBB Fund shall have delivered to the Warburg Fund on the Closing
Date a certificate executed in its name, and on behalf of the BEA Fund, by its
President or Vice President and its Treasurer or Assistant Treasurer, in form
and substance satisfactory to the Warburg Fund and dated as of the Closing Date,
to the effect that the representations and warranties of the BEA Fund made in
this Agreement are true and correct at and as of the Closing Date, except as
they may be affected by the transactions contemplated by this Agreement, and as
to such other matters as the Warburg Fund shall reasonably request; and
7.4. The Warburg Fund shall have received on the Closing Date a favorable
opinion of Drinker Biddle & Reath LLP, counsel to the RBB Fund, in a form
satisfactory to the Secretary of the Warburg Fund, covering the following
points:
That (a) the RBB Fund is a validly existing corporation and in good
standing under the laws of the State of Maryland and has the statutory
power to own all of its properties and assets and to carry on its business
as a registered investment company; (b) the Agreement has been duly
authorized, executed and delivered by the RBB Fund on behalf of the BEA
Fund and, assuming due authorization, execution and delivery of the
Agreement by the other parties hereto, is a valid and binding obligation
of the RBB Fund enforceable against the RBB Fund in accordance with its
terms, subject to the effect of bankruptcy, insolvency, fraudulent
conveyance, reorganization, moratorium and other laws relating to or
affecting creditors' rights generally and to general equity principles;
(c) the execution and delivery of the Agreement did not, and the
consummation of the transactions contemplated hereby will not, result in a
violation of the RBB Fund's Charter or By-Laws or a material violation of
any provision of any agreement (known to such counsel) to which the RBB
Fund or the BEA Fund is a party or by which either of them or their
properties are bound or, to the knowledge of such counsel, result in the
acceleration of any obligation or the imposition of any penalty, under any
agreement, judgment or decree to which the RBB Fund or the BEA Fund is a
party or by which either of them or their properties are bound, (d) to the
knowledge of such counsel, no consent, approval, authorization or order of
any court or governmental authority of the United States or state of
Maryland is required for the consummation by the RBB Fund and the BEA Fund
of the transactions contemplated herein, except such as have been obtained
under the 1933 Act, the 1934 Act and the 1940 Act, and such as may be
required under state securities laws; (e) the Proxy Statement (except as
to financial and statistical data contained therein, as to which no
opinion need be given) comply as to form in all material respects with the
requirements of the 1934 Act and the 1940 Act and the rules and
regulations thereunder; (f) such counsel does not know of any legal,
administrative or governmental proceedings, investigation, order, decree
or
15
<PAGE> 64
judgment of any court or governmental body, only insofar as they relate to
the RBB Fund or the BEA Fund or their respective assets or properties,
pending, threatened or otherwise existing on or before the effective date
of the Registration Statement or the Closing Date, which are required to
be described in the Registration Statement or to be filed as exhibits to
the Registration Statement which are not described and filed as required
or which materially and adversely affect the BEA Fund's business; and (g)
the RBB Fund is registered as an investment company under the 1940 Act and
its registration with the Commission as an investment company under the
1940 Act is in full force and effect.
Such counsel also shall state that they have participated in conferences
with officers and other representatives of the RBB Fund and the BEA Fund at
which the contents of the Proxy Statement and related matters were discussed
and, although they are not passing upon and do not assume any responsibility for
the accuracy, completeness or fairness of the statements contained in the Proxy
Statement (except to the extent indicated in paragraph (e) of their above
opinion), on the basis of the foregoing (relying as to materiality to a large
extent upon the opinions of officers and other representatives of the BEA Fund),
they do not believe that the Proxy Statement as of its date, as of the date of
the BEA Fund's shareholder meeting, and as of the Closing Date, contained an
untrue statement of a material fact or omitted to state a material fact required
to be stated therein regarding the RBB Fund or the BEA Fund or necessary in the
light of the circumstances under which they were made, to make the statements
therein regarding the RBB Fund and the BEA Fund not misleading.
Such opinion may state that such counsel does not express any opinion or
belief as to the financial statements or other financial data, or as to the
information relating to the Warburg Fund, contained in the Proxy Statement or
Registration Statement, and that such opinion is solely for the benefit of the
Warburg Fund and its directors and officers. Such opinion also shall include
such other matters incident to the transaction contemplated hereby as the
Warburg Fund may reasonably request.
In this paragraph 7.4, references to the Proxy Statement include and
relate only to the text of such Proxy Statement and not to any exhibits or
attachments thereto or to any documents incorporated by reference therein.
7.5. The Warburg Fund shall have received from PricewaterhouseCoopers LLP
a letter addressed to the Warburg Fund dated as of the effective date of the
Registration Statement in form and substance satisfactory to the Warburg Fund,
to the effect that:
16
<PAGE> 65
(a) they are independent public accountants with respect to the RBB Fund
within the meaning of the 1933 Act and the applicable regulations thereunder;
(b) in their opinion, the financial statements and per Share income and
capital changes of the BEA Fund included or incorporated by reference in the
Registration Statement and reported on by them comply as to form in all material
aspects with the applicable accounting requirements of the 1933 Act and the
rules and regulations thereunder; and
(c) on the basis of limited procedures agreed upon by the Warburg Fund and
the RBB Fund and described in such letter (but not an examination in accordance
with generally accepted auditing standards), the information relating to the BEA
Fund appearing in the Registration Statement and the Proxy Statement that is
expressed in dollars or percentages of dollars (with the exception of
performance comparisons) has been obtained from the accounting records of such
BEA Fund or from schedules prepared by officers of the RBB Fund having
responsibility for financial and reporting matters and such information is in
agreement with such records, schedules or computations made therefrom.
7.6. The RBB Fund shall have delivered to the Warburg Fund, pursuant to
paragraph 4.1(f), copies of financial statements of the BEA Fund as of and for
its most recently completed fiscal year.
7.7. The Warburg Fund shall have received from PricewaterhouseCoopers LLP
a letter addressed to the Warburg Fund and dated as of the applicable Closing
Date stating that as of a date no more than three (3) business days prior to the
applicable Closing Date, PricewaterhouseCoopers LLP performed limited
procedures in connection with the RBB Fund's unaudited financial statements for
the year ended August 31, 1998 and that (a) nothing came to their attention in
performing such limited procedures or otherwise that led them to believe that
there had been any changes in the assets, liabilities, net assets, net
investment income, net increase (decrease) in net assets from operations or net
increase (decrease) in net assets as compared with amounts as of the BEA Fund's
most recent audited fiscal year end or the corresponding period in the BEA
Fund's most recent audited fiscal year, other than changes occurring in the
ordinary course of business, and (b) based on such limited procedures, there is
no change in their report on the most recent audited financial statements of
such BEA Fund.
7.8. The Board of Directors of the RBB Fund, including a majority of the
directors who are not "interested persons" of the RBB Fund (as defined by the
1940 Act), shall have determined that this Agreement and the transactions
contemplated hereby are in the best interests of the RBB Fund and each BEA Fund
and that the interests of the shareholders in the RBB Fund and each BEA Fund
would not be diluted as a result of such transactions, and the
17
<PAGE> 66
RBB Fund shall have delivered to each Warburg Fund at the applicable Closing, a
certificate, executed by an officer, to the effect that the condition described
in this subparagraph has been satisfied.
8. FURTHER CONDITIONS PRECEDENT TO OBLIGATIONS OF EACH WARBURG FUND AND THE
RBB FUND WITH RESPECT TO EACH BEA FUND
If any of the conditions set forth below do not exist on or before the
Closing Date with respect to any Warburg Fund, the RBB Fund on behalf of the
corresponding BEA Fund shall, and if any of such conditions do not exist on or
before the Closing Date with respect to any BEA Fund, the corresponding Warburg
Fund shall, at their respective option, not be required to consummate the
transactions contemplated by this Agreement.
8.1. The Agreement and the transactions contemplated herein shall have
been approved by the requisite vote of the holders of the outstanding Shares of
the BEA Fund in accordance with the provisions of the RBB Fund's Charter and
applicable law and certified copies of the votes evidencing such approval shall
have been delivered to the corresponding Warburg Fund.
8.2. On the Closing Date no action, suit or other proceeding shall be
pending before any court or governmental agency in which it is sought to
restrain or prohibit, or obtain damages or other relief in connection with, this
Agreement or the transactions contemplated herein.
8.3. All consents of other parties and all other consents, orders and
permits of federal, state and local regulatory authorities (including those of
the Commission and of state blue sky and securities authorities, including
"no-action" positions of and exemptive orders from such federal and state
authorities) deemed necessary by the Warburg Fund or the RBB Fund to permit
consummation, in all material respects, of the transactions contemplated hereby
shall have been obtained, except where failure to obtain any such consent, order
or permit would not involve a risk of a material adverse effect on the assets or
properties of the Warburg Fund or the BEA Fund, provided that either party
hereto may for itself waive any of such conditions.
8.4. The Registration Statement and the Warburg Fund Registration
Statement shall each have become effective under the 1933 Act and no stop orders
suspending the effectiveness thereof shall have been issued and, to the best
knowledge of the parties hereto, no investigation or proceeding for that purpose
shall have been instituted or be pending, threatened or contemplated under the
1933 Act.
8.5. The parties shall have received a favorable opinion of Willkie Farr &
Gallagher, addressed to, and in form and substance satisfactory to, the RBB
Fund, on behalf of the BEA
18
<PAGE> 67
Fund, and the Warburg Fund, substantially to the effect that for federal income
tax purposes:
(a) The transfer of all or substantially all of the BEA Fund's
assets in exchange for the Warburg Fund Shares and the assumption by
the Warburg Fund of liabilities of the BEA Fund, and the
distribution of such Warburg Fund Shares to shareholders of the BEA
Fund in exchange for their shares of the BEA Fund, will constitute a
"reorganization" within the meaning of Section 368(a) of the Code,
and the Warburg Fund and the BEA Fund will each be a "party to a
reorganization" within the meaning of Section 368(b) of the Code;
(b) no gain or loss will be recognized by the Warburg Fund on the
receipt of the assets of the BEA Fund solely in exchange for the
Warburg Fund Shares and the assumption by the Warburg Fund of
liabilities of the BEA Fund; (c) no gain or loss will be recognized
by the BEA Fund upon the transfer of the BEA Fund's assets to the
Warburg Fund in exchange for the Warburg Fund Shares and the
assumption by the Warburg Fund of liabilities of the BEA Fund or
upon the distribution of the Warburg Fund Shares to the BEA Fund's
shareholders in exchange for their shares of the BEA Fund; (d) no
gain or loss will be recognized by shareholders of the BEA Fund upon
the exchange of their BEA Fund shares for the Warburg Fund Shares or
upon the assumption by the Warburg Fund of liabilities of the BEA
Fund; (e) the aggregate tax basis for the Warburg Fund Shares
received by each of the BEA Fund's shareholders pursuant to the
Reorganization will be the same as the aggregate tax basis of the
BEA Fund Shares held by such shareholder immediately prior to the
Reorganization, and the holding period of the Warburg Fund Shares to
be received by each BEA Fund shareholder will include the period
during which the BEA Fund Shares exchanged therefor were held by
such shareholder (provided that the BEA Fund Shares were held as
capital assets on the date of the Reorganization); and (f) the tax
basis of the BEA Fund's assets acquired by the Warburg Fund will be
the same as the tax basis of such assets to the BEA Fund immediately
prior to the Reorganization, and the holding period of the assets of
the BEA Fund in the hands of the Warburg Fund will include the
period during which those assets were held by the BEA Fund.
Notwithstanding anything herein to the contrary, neither the Warburg Fund
nor the RBB Fund may waive the conditions set forth in this paragraph 8.5.
9. BROKERAGE FEES AND EXPENSES; OTHER AGREEMENTS
9.1. Each Warburg Fund represents and warrants to the corresponding BEA
Fund, and the RBB Fund on behalf of each BEA
19
<PAGE> 68
Fund represents and warrants to the corresponding Warburg Fund, that there are
no brokers or finders or other entities to receive any payments in connection
with the transactions provided for herein.
9.2. BEA Associates or its affiliates agrees to bear the reasonable
expenses incurred in connection with the transactions contemplated by this
Agreement, whether or not consummated (excluding extraordinary expenses such as
litigation expenses, damages and other expenses not normally associated with
transactions of the type contemplated by this Agreement). These expenses consist
of: (i) expenses associated with preparing this Agreement, the Registration
Statement and expenses of the shareholder meetings; (ii) preparing and filing
the Warburg Registration Statement covering the Fund Shares to be issued in the
Reorganization; (iii) registration or qualification fees and expenses of
preparing and filing such forms, if any, necessary under applicable state
securities laws to qualify the Warburg Fund Shares to be issued in connection
with the Reorganization; (iv) postage; printing; accounting fees; and legal fees
incurred by the Warburg Fund and by the RBB Fund in connection with the
transactions contemplated by this Agreement; (v) solicitation costs incurred in
connection with the shareholders meeting referred to in clause (i) above and
paragraph 5.2 hereof and (vi) any other reasonable Reorganization expenses.
9.3. (a) BEA Associates agrees to indemnify and hold harmless each person
who at the time of execution of this Agreement is a director or officer of the
RBB Fund (a "BEA Indemnified Party") from and against any and all direct and
indirect liabilities, losses, claims, damages and expenses (including, without
limitation, reasonable attorneys' fees) ("Losses") incurred by a BEA Indemnified
Party and that arise from or relate to the operations of a Warburg Fund
commencing on the first business day after the Closing Date. This
indemnification provision shall only cover Losses that have not been recovered
by the BEA Indemnified Party from the relevant Warburg Fund after a reasonable
period of time following a written request to do so by the BEA Indemnified
Party.
(b) BEA Associates' agreement to indemnify the BEA Indemnified Parties
pursuant to this paragraph 9.3 is expressly conditioned upon BEA's being
promptly notified of any action or claim brought against any such party after
the BEA Indemnified Party receives notice of the action. The failure of a BEA
Indemnified Party to notify BEA Associates shall not relieve BEA Associates from
any liability that BEA Associates may have otherwise than on account of this
indemnification agreement.
(c) In case any action or claim shall be brought against any BEA
Indemnified Party and it shall timely notify BEA Associates of the commencement
thereof, BEA Associates shall be entitled to participate in, and, to the extent
that it shall wish to do so, to assume the defense thereof with counsel
satisfactory
20
<PAGE> 69
to it. If BEA Associates opts to assume the defense of such action, BEA
Associates will not be liable to the BEA Indemnified Party for any legal or
other expenses subsequently incurred by the BEA Indemnified Party in connection
with the defense thereof other than (1) reasonable costs of investigation or the
furnishing of documents or witnesses and (2) all reasonable fees and expenses of
separate counsel to such BEA Indemnified Party if the BEA Indemnified Party
shall have concluded reasonably that representation of BEA Associates and the
BEA Indemnified Party by the same counsel would be inappropriate due to actual
or potential differing interests between them in the conduct of the defense of
such action.
9.4. Any other provision of this Agreement to the contrary
notwithstanding, any liability of the RBB Fund under this Agreement with respect
to any BEA Fund, or in connection with the transactions contemplated herein with
respect to any BEA Fund, shall be discharged only out of the assets of that BEA
Fund, and no other portfolio of the RBB Fund shall be liable with respect
thereto.
10. ENTIRE AGREEMENT; SURVIVAL OF WARRANTIES
10.1. Each Warburg Fund and the RBB Fund, itself and on behalf of the
corresponding BEA Fund, agree that neither party has made any representation,
warranty or covenant not set forth herein and that this Agreement constitutes
the entire agreement among the parties.
10.2. The representations, warranties and covenants contained in this
Agreement or in any document delivered pursuant hereto or in connection herewith
shall survive the consummation of the transactions contemplated hereunder.
11. TERMINATION
11.1. This Agreement may be terminated at any time at or prior to the
Closing Date by: (1) mutual agreement of the RBB Fund, on behalf of any BEA
Fund, and the corresponding Warburg Fund; (2) the RBB Fund, on behalf of any BEA
Fund, in the event the corresponding Warburg Fund shall, or any Warburg Fund in
the event the RBB Fund or the corresponding BEA Fund shall, materially breach
any representation, warranty or agreement contained herein to be performed at or
prior to the Closing Date; or (3) the RBB Fund, on behalf of any BEA Fund, or
any Warburg Fund in the event a condition herein expressed to be precedent to
the obligations of the terminating party or parties has not been met and it
reasonably appears that it will not or cannot be met.
11.2. In the event of any such termination, there shall be no liability
for damages on the part of either the relevant Warburg Fund or the RBB Fund, or
their respective directors or officers, to the other party or parties.
21
<PAGE> 70
12. AMENDMENTS
This Agreement may be amended, modified or supplemented in writing in such
manner as may be mutually agreed upon by the authorized officers of the relevant
Warburg Fund and the RBB Fund; provided, however, that following the meeting of
a BEA Fund's shareholders called by the RBB Fund pursuant to paragraph 5.2 of
this Agreement no such amendment may have the effect of changing the provisions
for determining the number of the Warburg Fund Shares to be issued to such BEA
Fund's Shareholders under this Agreement to the detriment of such shareholders
without their further approval.
13. NOTICES
13.1. Any notice, report, statement or demand required or permitted by any
provisions of this Agreement shall be in writing and shall be given by prepaid
telegraph, telecopy or certified mail addressed to the RBB Fund and/or a BEA
Fund at:
Bellevue Park Corporate Center
400 Bellevue Parkway
3rd Floor
Wilmington, DE 19809
Attention: Edward Roach
with a copy to:
Henry S. Hilles, Jr. Esq.
Drinker Biddle & Reath LLP
Philadelphia National Bank Bldg.
1345 Chestnut Street
Philadelphia, PA 19107
or to a Warburg Fund at:
466 Lexington Avenue
New York, NY 10017
Attention: Eugene P. Grace
with a copy to:
Rose F. DiMartino, Esq.
Willkie Farr & Gallagher
787 Seventh Avenue
New York, NY 10019
14. HEADINGS; COUNTERPARTS; GOVERNING LAW; ASSIGNMENT; LIMITATION OF
LIABILITY
14.1. The article and paragraph headings contained in this Agreement are
for reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement.
14.2. This Agreement may be executed in any number of counterparts, each
of which shall be deemed an original.
22
<PAGE> 71
14.3. This Agreement shall be governed by and construed in accordance with
the laws of the State of Maryland.
14.4. This Agreement shall bind and inure to the benefit of the parties
hereto and their respective successors and assigns, but no assignment or
transfer hereof or of any rights or obligations hereunder shall be made by any
party without the written consent of the other party. Nothing herein expressed
or implied is intended or shall be construed to confer upon or give any person,
firm or corporation, other than the parties hereto and their respective
successors and assigns, any rights or remedies under or by reason of this
Agreement.
IN WITNESS WHEREOF, each of the parties hereto has caused this Agreement
to be executed Chairman of the Board, President or Vice President and attested
to by its Secretary or Assistant Secretary.
23
<PAGE> 72
WARBURG, PINCUS INTERNATIONAL GROWTH FUND, INC.
WARBURG, PINCUS EMERGING MARKETS II FUND, INC.
WARBURG, PINCUS U.S. CORE EQUITY FUND, INC.
WARBURG, PINCUS U.S. CORE FIXED INCOME FUND, INC.
WARBURG, PINCUS STRATEGIC GLOBAL FIXED INCOME FUND, INC.
WARBURG, PINCUS HIGH YIELD FUND, INC.
WARBURG, PINCUS MUNICIPAL BOND FUND, INC.
WARBURG, PINCUS GLOBAL TELECOMMUNICATIONS FUND, INC.
WARBURG, PINCUS LONG-SHORT MARKET NEUTRAL FUND, INC.
WARBURG, PINCUS LONG-SHORT EQUITY FUND, INC.
WARBURG, PINCUS SELECT ECONOMIC VALUE EQUITY FUND, INC.
By:_____________________________________________
Name:
Title:
Attest:_________________________________________
THE RBB FUND, INC., for itself and
on behalf of the
BEA INTERNATIONAL EQUITY FUND
BEA EMERGING MARKETS FUND
BEA U.S. CORE EQUITY FUND
BEA U.S. CORE FIXED INCOME FUND
BEA STRATEGIC GLOBAL FIXED INCOME FUND
BEA HIGH YIELD FUND
BEA MUNICIPAL BOND FUND
BEA GLOBAL TELECOMMUNICATIONS FUND
BEA LONG-SHORT MARKET NEUTRAL FUND
BEA LONG-SHORT EQUITY FUND
BEA SELECT ECONOMIC VALUE EQUITY FUND
By:_____________________________________________
Name:
Title:
Attest: ________________________________________
24
<PAGE> 73
Solely with respect to paragraphs 9.2 and 9.3:
BEA ASSOCIATES
By:_____________________________________________
Name:
Title:
Attest: ________________________________________
25
<PAGE> 74
SCHEDULE A
BEA Fund Warburg Fund
-------- ------------
International Growth Fund International Growth Fund
Institutional Shares Institutional Shares
Advisor Shares Common Shares
Emerging Markets Equity Fund Emerging Markets II Fund
Institutional Shares Institutional Shares
Advisor Shares Common Shares
U.S. Core Equity Fund U.S. Core Equity Fund
Institutional Shares Institutional Shares
U.S. Core Fixed Income Fund U.S. Core Fixed Income Fund
Institutional Shares Institutional Shares
Strategic Global Fixed Income Fund Strategic Global Fixed Income Fund
Institutional Shares Institutional Shares
High Yield Fund High Yield Fund
Institutional Shares Institutional Shares
Advisor Shares Common Shares
Municipal Bond Fund Municipal Bond Fund
Institutional Shares Institutional Shares
Global Telecommunications Fund Global Telecommunications Fund
Advisor Shares Common Shares
26
<PAGE> 75
BEA Fund Warburg Fund
-------- ------------
Long-Short Market Neutral Fund Long-Short Market Neutral Fund
Institutional Shares Institutional Shares
Advisor Shares Common Shares
Long-Short Equity Fund Long-Short Equity Fund
Institutional Shares Institutional Shares
Advisor Shares Common Shares
Select Economic Value Equity Select Economic Value Equity Fund
Fund Institutional Shares
Institutional Shares Common Shares
Advisor Shares
27
<PAGE> 76
PROSPECTUSES OF WARBURG FUND, INC.
DATED AUGUST 3, 1998 ARE INCORPORATED BY
REFERENCE TO ITS N-1A REGISTRATION STATEMENT
<PAGE> 77
SUBJECT TO COMPLETION, DATED AUGUST 7, 1998
STATEMENT OF ADDITIONAL INFORMATION DATED [INSERT] , 1998
ACQUISITION OF THE ASSETS OF
BEA INTERNATIONAL EQUITY FUND
BEA EMERGING MARKETS EQUITY FUND
BEA U.S. CORE EQUITY FUND
BEA U.S. CORE FIXED INCOME FUND
BEA STRATEGIC GLOBAL FIXED INCOME FUND
BEA HIGH YIELD FUND
BEA MUNICIPAL BOND FUND
BEA GLOBAL TELECOMMUNICATIONS FUND
BEA LONG-SHORT MARKET NEUTRAL FUND
BEA LONG-SHORT EQUITY FUND
BEA SELECT ECONOMIC VALUE EQUITY FUND
("BEA FUNDS")
SEPARATE INVESTMENT PORTFOLIOS OF
THE RBB FUND, INC.
400 BELLEVUE PARKWAY
3RD FLOOR
WILMINGTON, DELAWARE 19809
(302) 792-2555
BY AND IN EXCHANGE FOR SHARES OF
WARBURG, PINCUS INTERNATIONAL GROWTH FUND, INC.
WARBURG, PINCUS EMERGING MARKETS II FUND, INC.
WARBURG, PINCUS U.S. CORE EQUITY FUND, INC.
WARBURG, PINCUS U.S. CORE FIXED INCOME FUND, INC.
WARBURG, PINCUS STRATEGIC GLOBAL FIXED INCOME FUND, INC.
WARBURG, PINCUS HIGH YIELD FUND, INC.
WARBURG, PINCUS MUNICIPAL BOND FUND, INC.
WARBURG, PINCUS GLOBAL TELECOMMUNICATIONS FUND, INC.
WARBURG, PINCUS LONG-SHORT MARKET NEUTRAL FUND, INC.
WARBURG, PINCUS LONG-SHORT EQUITY FUND, INC.
WARBURG, PINCUS SELECT ECONOMIC VALUE EQUITY FUND, INC.
("WARBURG FUNDS")
466 LEXINGTON AVENUE
NEW YORK, NEW YORK 10017
800-WARBURG
This Statement of Additional Information, relating specifically to
the proposed transfer of all or substantially all of the assets of the BEA Funds
of The RBB Fund, Inc. to the
<PAGE> 78
Warburg Funds in exchange for shares of the Warburg Funds and the assumption by
the Warburg Funds of liabilities of the BEA Funds, consists of this cover page
and the following described documents, each of which accompanies this Statement
of Additional Information and is incorporated herein by reference.
1. Statements of Additional Information for each class of
shares of the Warburg Funds, each dated August __, 1998.
2. Annual Reports of the relevant BEA Funds for the fiscal
year ended August 31, 1997
3. Semiannual Reports of the relevant BEA Funds for the
six-month period ended February 28, 1998.
This Statement of Additional Information is not a prospectus. A
Combined Prospectus/Proxy Statement, dated August __, 1998, relating to the
above-referenced matter may be obtained without charge by calling or writing the
Warburg Fund at the telephone number or address set forth above. This Statement
of Additional Information should be read in conjunction with the Combined
Prospectus/Proxy Statement.
<PAGE> 79
STATEMENT OF ADDITIONAL INFORMATION
OF THE WARBURG FUND
DATED August 3, 1998
IS INCORPORATED BY REFERENCE
TO ITS N-1A REGISTRATION STATEMENT
<PAGE> 80
PART C
OTHER INFORMATION
Item 15. Indemnification -- The response to this item is incorporated by
reference to "Plan of Reorganization" under the caption "Information
About the Reorganization" and to "Liability of Directors" under the
caption "Information on Shareholders' Rights" in Part A of this
Registration Statement.
Item 16. Exhibits -- References are to Registrant's Registration Statement on
Form N-1A as filed with the Securities and Exchange Commission on
[INSERT], 1998 (the "N-1A Registration Statement").
(1) Registrant's Articles of Incorporation are incorporated by reference
to the N-1A Registration Statement.
(2) By-Laws of the Registrant are incorporated by reference to the N-1A
Registration Statement.
(3) Not Applicable.
(4) Form of Plan of Reorganization (included as Exhibit A to
Registrant's Combined Prospectus/Proxy Statement contained in Part A
of this Registration Statement).
(5) Not Applicable.
(6) Form of Investment Advisory Agreement for BEA Associates is
incorporated by reference to the N-1A Registration Statement.
(7) Not Applicable.
(8) Not Applicable.
(9) Forms of Custodian Agreements are incorporated by reference to the
N-1A Registration Statement.
(10)(a) Forms of Distribution Plans pursuant to Rule 12b-1 under the 1940
Act are incorporated by reference to the N-1A Registration
Statement.
(10)(b) Forms of Distribution Agreements are incorporated by reference to
the N-1A Registration Statement.
(10)(c) Forms of Services Agreement are incorporated by reference to the
N-1A
<PAGE> 81
Registration Statement.
(10)(d) Form of 18f-3 Plan is incorporated by reference to the N-1A
Registration Statement.
(11)(a) Opinion and Consent of Willkie Farr & Gallagher, counsel to
Registrant, with respect to validity of shares.*
(11)(b) Opinion of Venable, Baetjer and Howard, L.L.P., Maryland counsel to
Registrant, with respect to validity of shares.*
(12) Opinion and Consent of Willkie Farr & Gallagher with respect to tax
matters.*
(13)(a) Form of Transfer Agency Agreement is incorporated by reference to
the N-1A Registration Statement.
(13)(b) Forms of Co-Administration Agreements is incorporated by reference
to the N-1A Registration Statement.
(14) Consent of PricewaterhouseCoopers LLP*
(15) Not Applicable.
(16) Not Applicable.
(17)(a) Form of Proxy Cards.
(17)(b) Registrant's declaration pursuant to Rule 24f-2 is incorporated by
reference to the N-1A Registration Statement.
Item 17. Undertakings
- -------- ------------
(1) The undersigned Registrant agrees that prior to any public
reoffering of the securities registered through the use of a
prospectus which is a part of this Registration Statement by any
person or party who is deemed to be an underwriter within the
meaning of Rule 145(c) of the Securities Act [17 CFR 230.145c], the
reoffering prospectus will contain the information called for by the
applicable registration form for reofferings by persons who may be
deemed underwriters, in addition to the information called for by
the other items of the applicable form.
(2) The undersigned Registrant agrees that every prospectus that is
filed under paragraph (1) above will be filed as a part of an
amendment to the Registration Statement and will not be used until
the amendment is effective, and that, in determining any liability
under the Securities Act of 1933, as amended, each post-effective
amendment shall be deemed to be a new
<PAGE> 82
registration statement for the securities offered therein, and the
offering of the securities at that time shall be deemed to be the
initial bona fide offering of them.
- ----------
* To be filed by amendment.
<PAGE> 83
SIGNATURES
As required by the Securities Act of 1933, as amended, this
Registration Statement has been signed on behalf of the registrant, in the City
of New York and State of New York, on the 20th day of July, 1998.
Warburg, Pincus Emerging Markets II Fund, Inc.
By: /s/ Eugene L. Podsiadlo
Name: Eugene L. Podsiadlo
Title: President
As required by the Securities Act of 1933, as amended, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
Signature Title Date
--------- ----- ----
/s/ John L. Furth Chairman of the July 20, 1998
John L. Furth Board of Directors
/s/ Eugene L. Podsiadlo President July 20, 1998
Eugene L. Podsiadlo
/s/ Howard Conroy Vice President and July 20, 1998
Howard Conroy Chief Financial Officer
/s/ Daniel S. Madden Treasurer and Chief July 20, 1998
Daniel S. Madden Accounting Officer
/s/ Richard N. Cooper Director July 20, 1998
Richard N. Cooper
/s/ Jack W. Fritz Director July 20, 1998
Jack W. Fritz
/s/ Jeffrey E. Garten Director July 20, 1998
Jeffrey E. Garten
<PAGE> 84
Signature Title Date
--------- ----- ----
/s/ Arnold M. Reichman Director July 20, 1998
Arnold M. Reichman
/s/ Alexander B. Trowbridge Director July 20, 1998
Alexander B. Trowbridge
<PAGE> 85
EXHIBIT INDEX
Exhibit Number Description Page
- -------------- ----------- ----
References are to Registrant's Registration Statement on Form N-1A
as filed with the Securities and Exchange Commission on [INSERT],
1998 (the "N-1A Registration Statement").
(1) Registrant's Articles of Incorporation are incorporated
by reference to the N-1A Registration Statement.
(2) By-Laws of the Registrant are incorporated by reference
to the N-1A Registration Statement.
(4) Form of Plan of Reorganization (included as Exhibit A to
Registrant's Prospectus/Proxy Statement contained in
Part A of this Registration Statement).
(6) Form of Investment Advisory Agreement for BEA Associates
is incorporated by reference to the N-1A Registration
Statement.
(9)(a) Forms of Custodian Agreements are incorporated by
reference to the N-1A Registration Statement.
(10)(a) Forms of Distribution Plans pursuant to Rule 12b-1 under
the 1940 Act are incorporated by reference to the N-1A
Registration Statement.
(10)(b) Forms of Distribution Agreements are incorporated by
reference to the N-1A Registration Statement.
(10)(c) Form of Services Agreement is incorporated by reference
to the N-1A Registration Statement.
(10)(d) Form of 18f-3 Plan is incorporated by reference to the
N-1A Registration Statement.
(11)(a) Opinion and Consent of Willkie Farr & Gallagher, counsel
to Registrant, with respect to validity of shares.*
(11)(b) Opinion of Venable, Baetjer and Howard, L.L.P., Maryland
counsel to Registrant, with respect to validity of
shares.*
<PAGE> 86
(12) Opinion and Consent of Willkie Farr & Gallagher with
respect to tax matters.*
(13)(a) Form of Transfer Agency Agreement is incorporated by
reference to the N-1A Registration Statement.
(13)(b) Forms of Co-Administration Agreements is incorporated by
reference to the N-1A Registration Statement.
(14) Consent of PricewaterhouseCoopers LLP*
(17)(a) Form of Proxy Cards.
(17)(b) Registrant's declaration pursuant to Rule 24f-2 is
incorporated by reference to the N-1A Registration
Statement.
- ----------
* To be filed by amendment.
<PAGE> 1
FORM OF PROXY CARD
<PAGE> 2
VOTE THIS VOTING INSTRUCTION CARD TODAY!
YOUR PROMPT RESPONSE WILL SAVE
THE EXPENSE OF ADDITIONAL MAILINGS
(Please Detach at Perforation Before Mailing)
................................................................................
................................................................................
BEA [INSERT] FUND
PROXY SOLICITED BY THE BOARD OF DIRECTORS
The undersigned holder of shares of BEA [INSERT] Fund (the "Fund"), a series of
The RBB Fund, Inc., hereby appoints Edward J. Roach and [ ] attorneys and
proxies for the undersigned with full powers of substitution and revocation, to
represent the undersigned and to vote on behalf of the undersigned all shares of
the Fund that the undersigned is entitled to vote at the Special Meeting of
Shareholders of the Fund to be held at the offices of The RBB Fund, Inc.,
Bellevue Park Corporate Center, 400 Bellevue Parkway, Wilmington, Delaware 19809
on September 21, 1998 at 3:00 p.m., and any adjournment or adjournments thereof.
The undersigned hereby acknowledges receipt of the Notice of Special Meeting and
Combined Prospectus/Proxy Statement dated August __, 1998 and hereby instructs
said attorneys and proxies to vote said shares as indicated herein. In their
discretion, the proxies are authorized to vote upon such other business as may
properly come before the Meeting. A majority of the proxies present and acting
at the Meeting in person or by substitute (or, if only one shall be so present,
then that one) shall have and may exercise all of the power and authority of
said proxies hereunder. The undersigned hereby revokes any proxy previously
given.
PLEASE SIGN, DATE AND RETURN
PROMPTLY IN THE ENCLOSED ENVELOPE
Note: Please sign exactly as your name appears on this Proxy. If
joint owners, EITHER may sign this Proxy. When signing as attorney,
executor, administrator, trustee, guardian or corporate officer,
please give your full title.
Date: _______________________________
_______________________________
Signature(s) (Title(s), if applicable)
<PAGE> 3
VOTE THIS VOTING INSTRUCTION CARD TODAY!
YOUR PROMPT RESPONSE WILL SAVE
THE EXPENSE OF ADDITIONAL MAILINGS
(Please Detach at Perforation Before Mailing)
................................................................................
................................................................................
Please indicate your vote by an "X" in the appropriate box below. This proxy, if
properly executed, will be voted in the manner directed by the undersigned
shareholder. IF NO DIRECTION IS MADE, THIS PROXY WILL BE VOTED "FOR" APPROVAL OF
THE PROPOSAL.
1. To approve or disapprove the FOR [ ] AGAINST [ ] ABSTAIN [ ]
Plan of Reorganization
To approve or disapprove the respective Plan of Reorganization dated as of
[INSERT], 1998 (the "Plan") providing (i) that each of BEA International
Equity Fund, BEA Emerging Markets Equity Fund, BEA U.S. Core Equity Fund,
BEA U.S. Core Fixed Income Fund, BEA Strategic Global Fixed Income Fund, BEA
High Yield Fund, BEA Municipal Bond Fund, BEA Global Telecommunications
Fund, BEA Long-Short Market Neutral Fund, BEA Long-Short Equity Fund and BEA
Select Economic Value Equity Fund (individually a "BEA Fund" and together
the "BEA Funds") would be reorganized from a series of The RBB Fund, Inc.
(the "RBB Fund") into Warburg Pincus International Growth Fund, Inc.,
Warburg Pincus Emerging Markets II Fund, Inc., Warburg Pincus U.S. Core
Equity Fund, Inc., Warburg Pincus U.S. Core Fixed Income Fund, Inc., Warburg
Pincus Strategic Global Fixed Income Fund, Inc., Warburg Pincus High Yield
Fund, Inc., Warburg Pincus Municipal Bond Fund, Inc., Warburg, Pincus Global
Telecommunications Fund, Inc., Warburg, Pincus Long-Short Market Neutral
Fund, Inc., Warburg, Pincus Long-Short Equity Fund, Inc. and Warburg, Pincus
Select Economic Value Equity Fund, Inc., respectively, (individually a
"Warburg Fund" and together the "Warburg Funds"), (ii) each BEA Fund would
transfer to the corresponding Warburg Fund all or substantially all of its
assets in exchange for shares of the Warburg Fund and the assumption of the
BEA Fund's liabilities, (iii) the distribution of such shares of the Warburg
Funds to shareholders of the BEA Funds in liquidation of the BEA Funds and
(iv) the subsequent termination of the BEA Funds.
2. To transact such other business as may properly come before the Meeting or
any adjournment or adjournments thereof.
................................................................................
