WARBURG PINCUS CASH RESERVE FUND, 485BPOS, 2000-04-28

WARBURG PINCUS CASH RESERVE FUND
485BPOS, 2000-04-28

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<PAGE> 1

As Filed with the Securities and Exchange Commission
on April 28, 2000

Securities Act File No. 2-94840
Investment Company Act File No. 811-4171

SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM N-1A

REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 [x]

Pre-Effective Amendment No. [ ]

Post-Effective Amendment No. 18 [x]

and/or

REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 [x]

Amendment No. 20 [x]

(Check appropriate box or boxes)

Warburg, Pincus Cash Reserve Fund, Inc.
(formerly Counsellors Cash Reserve Fund, Inc.)
. . . . . . . . . . . . . . . . . . . . . . . . .
(Exact Name of Registrant as Specified in Charter)

466 Lexington Avenue
New York, New York 10017-3147
. . . . . . . . . . . . . . . . . . . .
(Address of Principal Executive Offices) (Zip Code)

Registrant's Telephone Number, including Area Code: (212) 878-0600

Hal Liebes, Esq.
Warburg, Pincus Cash Reserve Fund, Inc.
466 Lexington Avenue
New York, New York 10017-3147
. . . . . . . . . . . . . . . . . .
(Name and Address of Agent for Services)

Copy to:

Rose F. DiMartino, Esq.
Willkie Farr & Gallagher
787 Seventh Avenue
New York, New York 10019-6099

<PAGE> 2

Approximate Date of Proposed Public Offering: May 1, 2000

It is proposed that this filing will become effective (check appropriate box):

[ ] immediately upon filing pursuant to paragraph (b)

[x] on (May 1, 2000) pursuant to paragraph (b)

[ ] 60 days after filing pursuant to paragraph (a)(1)

[ ] on (date) pursuant to paragraph (a)(1)

[ ] 75 days after filing pursuant to paragraph (a)(2)

[ ] on (date) pursuant to paragraph (a)(2) of Rule 485.

If appropriate, check the following box:

[ ] This post-effective amendment designates a new
effective date for a previously filed post-effective amendment.

<PAGE> 3

[Warburg Pincus Funds Logo] [Credit Suisse Asset Management Logo]
PROSPECTUS

May 1, 2000

WARBURG PINCUS
CASH RESERVE FUND
-

WARBURG PINCUS
NEW YORK TAX EXEMPT FUND

As with all mutual funds, the Securities and Exchange
Commission has not approved these funds, nor has it passed
upon the adequacy or accuracy of this Prospectus. It is a
criminal offense to state otherwise.

Warburg Pincus Funds are advised by Credit Suisse Asset
Management, LLC.

<PAGE> 4

CONTENTS

<TABLE>
<S> <C>
KEY POINTS.................... .................... 4
Goals and Principal Strategies.................. 4
A Word About Risk............................... 5
Investor Profile................................ 6
PERFORMANCE SUMMARY............... ................ 8
Year-by-Year Total Returns...................... 8
Average Annual Total Returns.................... 9
INVESTOR EXPENSES................ ................. 10
Fees and Fund Expenses.......................... 10
Example......................................... 11
THE FUNDS IN DETAIL............... ................ 12
The Management Firms............................ 12
Fund Information Key............................ 13
CASH RESERVE FUND................ ................. 14
NEW YORK TAX EXEMPT FUND............. ............. 16
MORE ABOUT RISK................. .................. 18
Introduction.................................... 18
Types of Investment Risk........................ 18
Certain Investment Practices.................... 20
ABOUT YOUR ACCOUNT................ ................ 22
Share Valuation................................. 22
Buying and Selling Shares....................... 22
Account Statements.............................. 22
Distributions................................... 22
Taxes........................................... 23
OTHER INFORMATION................ ................. 25
About the Distributor........................... 25
FOR MORE INFORMATION............... ............... back cover
</TABLE>

3
<PAGE> 5

KEY POINTS
GOALS AND PRINCIPAL STRATEGIES

<TABLE>
<CAPTION>
FUND/RISK FACTORS GOAL STRATEGIES
<S> <C> <C>
CASH RESERVE FUND High current income - Invests in high-quality
Risk factors: consistent with liquidity money-market instruments:
Credit risk and stability of - obligations issued or guaranteed
Income risk principal by the U.S. government, its
Industry agencies or instrumentalities
concentration - bank and corporate debt
Interest-rate risk obligations
Market risk - Concentrates its investments in
the banking industry
- Portfolio managers select
investments based on factors such
as yield, maturity and
liquidity, within the context of
their interest-rate outlook
- Seeks to maintain a stable share
price of $1
NEW YORK TAX EXEMPT As high a level of - Invests in high-quality,
FUND current interest income short-term
Risk factors: exempt from federal, New tax-exempt New York municipal
Credit risk York state and New York securities -- debt obligations
Income risk City personal income whose interest is exempt from
Interest-rate risk taxes as is consistent federal, New York state and New
Market risk with preservation of York City income taxes
New York municipal capital and liquidity - Fund dividends derived from
securities interest on New York municipal
Non-diversified securities remain tax-exempt when
status distributed to New York state
residents
- Portfolio managers select
investments based on factors such
as yield, maturity and
liquidity, within the context of
their interest-rate outlook
- Seeks to maintain a stable share
price of $1
</TABLE>

4
<PAGE> 6

A WORD ABOUT RISK

All investments involve some level of risk. Simply defined, risk is the
possibility that you will lose money or not make money.

Principal risk factors for the funds are discussed below. Before you invest,
please make sure you understand the risks that apply to your fund.

Investments in the funds are not bank deposits and are not insured or
guaranteed by the Federal Deposit Insurance Corporation or any other government
agency. Although each fund seeks to preserve the value of your investment at $1
per share, it is possible to lose money by investing in a fund.

CREDIT RISK
Both funds

The issuer of a security or the counterparty to a contract may default or
otherwise become unable to honor a financial obligation. An issuer's failure to
make scheduled interest or principal payments to a fund could reduce the fund's
income level and share price.

INCOME RISK
Both funds

A fund's income level may decline because of falling interest rates and other
market conditions. Each fund's yield will vary from day to day, generally
reflecting changes in overall short-term interest rates. This should be an
advantage when interest rates are rising, but not when rates are falling.

INDUSTRY CONCENTRATION
Cash Reserve Fund

Investing more than 25% of its assets in the banking industry will subject
the fund to risks associated with investing in banks and banking-related
companies. These risks include interest-rate, market and regulatory risks.

INTEREST-RATE RISK
Both funds

Changes in interest rates may cause a decline in the market value of an
investment. With fixed-income securities, a rise in interest rates typically
causes a fall in values, while a fall in interest rates typically causes a rise
in values.

A sharp and unexpected rise in interest rates could cause a money-market
fund's share price to drop below $1. However, the extremely short maturity of
securities held in money-market portfolios -- a means of achieving an overall
fund objective of principal safety -- reduces their potential for price
fluctuation.

MARKET RISK
Both funds

The market value of a security may move up and down, sometimes rapidly and
unpredictably. Market risk may affect a single issuer, industry, sector of the
economy, or the market as a whole. Market risk is common to most
investments -- including debt securities and the mutual funds that invest in
them.

5
<PAGE> 7

NEW YORK MUNICIPAL SECURITIES
New York Tax Exempt Fund

The default or credit-rating downgrade of a New York state or New York City
issuer could affect the market values and marketability of all New York
municipal securities and hurt the fund's yield or share price.

NON-DIVERSIFIED STATUS
New York Tax Exempt Fund

The fund is considered a non-diversified investment company under the
Investment Company Act of 1940 and is permitted to invest a greater proportion
of its assets in the securities of a smaller number of issuers. As a result, the
fund may be subject to greater volatility with respect to its portfolio
securities than a fund that is more broadly diversified.
INVESTOR PROFILE

THESE FUNDS ARE DESIGNED FOR INVESTORS WHO:

- want to preserve the value of their investment

- are seeking a mutual fund for the money-market portion of an asset-
allocation portfolio

- want easy access to their money through checkwriting and wire-redemption
privileges

- are investing emergency reserves or other money for which safety and
accessibility are more important than total return

THESE FUNDS MAY NOT BE APPROPRIATE IF YOU:

- want federal deposit insurance

- desire the higher income available from longer-term fixed-income funds

- are investing for capital appreciation

In addition, the New York Tax Exempt Fund is not appropriate for IRAs or
other tax-advantaged retirement plans. You should base your selection of a fund
on your own goals, risk preferences and time horizon.

6
<PAGE> 8

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7
<PAGE> 9

PERFORMANCE SUMMARY

The bar chart below and the table on the next page provide an indication of the
risks of investing in these funds. The bar chart shows you how each fund's
performance has varied from year to year over the past 10 years. As with all
mutual funds, past performance is not a prediction of the future.

YEAR-BY-YEAR TOTAL RETURNS

[BAR CHART]

<TABLE>
<CAPTION>
YEAR ENDED 12/31: 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
CASH RESERVE FUND
Best quarter: 2.37% (Q2 89)
Worst quarter: 0.67% (Q2 93)
Inception date: 4/16/85 8.02% 6.00% 3.57% 2.77% 3.88% 5.63% 5.05% 5.19% 5.12% 4.74%
Total return for the period 1/1/00 - 3/31/00: 1.36% (not annualized)

NEW YORK TAX EXEMPT FUND
Best quarter: 1.47% (Q2 89)
Worst quarter: 0.41% (Q1 94)
Inception date: 4/18/85 5.14% 3.62% 2.36% 1.78% 2.25% 3.32% 2.92% 3.10% 2.92% 2.70%
Total return for the period 1/1/00 - 3/31/00: 0.74% (not annualized)
</TABLE>

8
<PAGE> 10

AVERAGE ANNUAL TOTAL RETURNS

<TABLE>
<CAPTION>
ONE YEAR 5 YEARS 10 YEARS LIFE OF INCEPTION
PERIOD ENDED 12/31/99: 1999 1995-1999 1990-1999 FUND DATE
<S> <C> <C> <C> <C> <C>
CASH RESERVE FUND 4.74% 5.15% 4.99% 5.79% 4/16/85
NEW YORK TAX EXEMPT FUND 2.70% 2.99% 3.01% 3.51% 4/18/85
</TABLE>

The total returns shown above are not the funds' yields. A fund's yield more
closely reflects the fund's current earnings.

YIELD

To obtain a fund's current 7-day yield, call toll-free 800-WARBURG
(800-927-2874).

UNDERSTANDING PERFORMANCE

- TOTAL RETURN tells you how much an investment in a fund has changed in
value over a given time period. It assumes that all dividends and capital
gains (if any) were reinvested in additional shares. The change in value
can be stated either as a cumulative return or as an average annual rate
of return.

- A CUMULATIVE TOTAL RETURN is the actual return of an investment for a
specified period. The year-by-year total returns in the bar chart are
examples of one-year cumulative total returns.

- An AVERAGE ANNUAL TOTAL RETURN applies to periods longer than one year.
It smoothes out the variations in year-by-year performance to tell you
what constant annual return would have produced the investment's actual
cumulative return. This gives you an idea of an investment's annual
contribution to your portfolio, assuming you held it for the entire
period.

- Because of compounding, the average annual total returns in the table
cannot be computed by averaging the returns in the bar chart.
9
<PAGE> 11

INVESTOR EXPENSES

FEES AND FUND EXPENSES

This table describes the fees and expenses you may bear as a shareholder. Annual
fund operating expense figures are for the fiscal year ended December 31, 1999.

<S> <C> <C>
NEW YORK
CASH RESERVE TAX EXEMPT
FUND FUND
SHAREHOLDER FEES
(paid directly from your investment)
Sales charge "load" on
purchases NONE NONE
Deferred sales charge "load" NONE NONE
Sales charge "load" on reinvested distributions NONE NONE
Redemption fees NONE NONE
Exchange fees NONE NONE
ANNUAL FUND OPERATING EXPENSES
(deducted from fund assets)
Management fee .50% .50%
Distribution and service
(12b-1) fee NONE NONE
Other expenses .17% .18%
TOTAL ANNUAL FUND OPERATING
EXPENSES* .67% .68%
</TABLE>

* Actual fees and expenses for the fiscal year ended December 31, 1999 are shown
below. Fee waivers and expense reimbursements or credits reduced some expenses
during 1999 but may be discontinued at any time.

<TABLE>
<CAPTION>
NEW YORK
EXPENSES AFTER WAIVERS CASH RESERVE TAX EXEMPT
AND REIMBURSEMENTS FUND FUND
<S> <C> <C>
Management fee .38% .37%
Distribution and service
(12b-1) fee NONE NONE
Other expenses .17% .18%
----- -----
TOTAL ANNUAL FUND OPERATING
EXPENSES .55% .55%
</TABLE>

10
<PAGE> 12

EXAMPLE

This example may help you compare the cost of investing in these funds with the
cost of investing in other mutual funds. Because it uses hypothetical
conditions, your actual costs may be higher or lower.

Assume you invest $10,000, each fund returns 5% annually, expense ratios remain
as listed in the first table on the opposite page (before fee waivers and
expense reimbursements or credits) and you close your account at the end of each
of the time periods shown. Based on these assumptions, your cost would be:

<TABLE>
<CAPTION>
ONE YEAR THREE YEARS FIVE YEARS 10 YEARS
<S> <C> <C> <C> <C>
CASH RESERVE FUND $68 $214 $373 $835
NEW YORK TAX EXEMPT FUND $69 $218 $379 $847
</TABLE>

11
<PAGE> 13

THE FUNDS IN DETAIL

THE MANAGEMENT FIRMS

CREDIT SUISSE ASSET
MANAGEMENT, LLC
One Citicorp Center
153 East 53rd Street
New York, NY 10022

- Investment adviser for the funds

- Responsible for managing each fund's assets according to its goal and
strategies

- A member of Credit Suisse Asset Management, the institutional asset
management and mutual fund arm of Credit Suisse Group (Credit Suisse), one of
the world's leading banks

- Credit Suisse Asset Management companies manage approximately $72 billion in
the U.S. and $203 billion globally

- Credit Suisse Asset Management has offices in 14 countries, including
SEC-registered offices in New York and London; other offices (such as those in
Budapest, Frankfurt, Milan, Moscow, Paris, Prague, Sydney, Tokyo, Warsaw and
Zurich) are not registered with the U.S. Securities and Exchange Commission

For easier reading, Credit Suisse Asset Management, LLC will be referred to
as "CSAM" or "we" throughout this Prospectus.

BLACKROCK INSTITUTIONAL
MANAGEMENT CORPORATION
400 Bellevue Parkway
Wilmington, DE 19809

- Sub-investment adviser for the funds

- Responsible for providing investment research and credit analysis, and
managing the day-to-day operations of the funds

- A majority owned indirect subsidiary of PNC Bank, N.A.

- Currently manages approximately
$55 billion in assets

<PAGE> 14

FUND INFORMATION KEY

Concise fund-by-fund descriptions begin on the next page. Each description
provides the following information:

GOAL AND STRATEGIES
The fund's particular investment goal and the strategies it intends to use in
pursuing that goal. Percentages of fund assets are based on total assets unless
indicated otherwise.

PORTFOLIO INVESTMENTS
The primary types of securities in which the fund invests. Secondary
investments are described in "More About Risk."

RISK FACTORS
The major risk factors associated with the fund. Additional risk factors are
included in "More About Risk."

INVESTOR EXPENSES

Actual fund expenses for the 1999 fiscal year. Future expenses may be higher
or lower.

- MANAGEMENT FEE The fee paid to the investment adviser and sub-investment
adviser for providing investment advice to the fund. Expressed as a percentage
of average net assets after waivers.

- OTHER EXPENSES Fees paid by the fund for items such as administration,
transfer agency, custody, auditing, legal and registration fees and
miscellaneous expenses. Expressed as a percentage of average net assets after
waivers, credits and reimbursements.

FINANCIAL HIGHLIGHTS
A table showing the fund's audited financial performance for up to five
years.

- TOTAL RETURN How much you would have earned on an investment in the fund,
assuming you had reinvested all distributions.

The Annual Report includes the auditor's report, along with the fund's
financial statements. It is available free upon request.

13
<PAGE> 15

CASH RESERVE FUND

GOAL AND STRATEGIES

The Cash Reserve Fund seeks high current income consistent with liquidity and
stability of principal. To pursue this goal, it invests in high-quality, U.S.
dollar-denominated money-market instruments. The fund seeks to maintain a stable
$1 share price.

In selecting securities, the portfolio managers may examine the relationships
among yields on various types and maturities of money-market securities in the
context of their outlook for interest rates. For example, commercial paper often
offers a yield advantage over Treasury bills. And if rates are expected to fall,
longer maturities may be purchased to try to preserve the fund's income level.
Conversely, shorter maturities may be favored if rates are expected to rise.
PORTFOLIO INVESTMENTS

This fund invests in the following types of money-market instruments:

- Government securities, including U.S. Treasury bills and other obligations of
the U.S. government, its agencies or instrumentalities

- U.S. and foreign bank obligations such as certificates of deposit, bankers'
acceptances, time deposits, commercial paper and debt obligations

- commercial paper and notes of other corporate issuers, including
variable-rate master demand notes and other variable-rate obligations

- repurchase agreements

No more than 5% of assets may be invested in securities rated in the second-
highest short-term rating category (or unrated equivalents). The rest of the
fund's investments must be in the highest short-term rating category. Under
normal conditions, the fund will invest at least 25% of assets in the banking
industry.

The fund maintains an average maturity of 90 days or less, and only purchases
securities that have (as determined under SEC rules) remaining maturities of 397
days or less. To a limited extent, the fund may also engage in other investment
practices.
RISK FACTORS

This fund's principal risk factors are:

- credit risk

- income risk

- industry concentration

- interest-rate risk

- market risk

The fund's yield will vary with changes in interest rates. If interest rates
fall, your dividend income will likely decline.

Since it is managed to maintain a constant $1 share price, the fund should
have little risk of principal loss. However, there is no assurance the fund will
avoid principal losses in the rare event that fund holdings default or interest
rates rise sharply in an unusually short period.

Concentrating its investments in the banking industry will subject the fund
to risks associated with investing in banks and banking-related companies. These
risks are discussed in "More About Risk." That section also details other
investment practices the fund may use. Please read "More About Risk" carefully
before you invest.

14
<PAGE> 16

PORTFOLIO MANAGEMENT

Under the supervision of CSAM, a portfolio-management team at BlackRock
Institutional Management Corporation, the fund's sub-investment adviser, makes
the fund's day-to-day investment decisions.

INVESTOR EXPENSES

Management fee .38%

All other expenses .17%

------------
Total expenses .55%

FINANCIAL HIGHLIGHTS
The figures below have been audited by the fund's independent auditors,
PricewaterhouseCoopers LLP.

PERIOD ENDED: 12/99(1) 12/98(1) 12/97(2) 2/97(3) 2/96(3) 2/95(3)
<S> <C> <C> <C> <C> <C> <C>
PER-SHARE DATA
Net asset value, beginning of
period $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
Investment activities:
Net investment income 0.05 0.05 0.04 0.05 0.05 0.04
Dividends:
Dividends from net investment
income (0.05) (0.05) (0.04) (0.05) (0.05) (0.04)
Net asset value, end of period $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
======== ======== ======== ======== ======== ========
Total return 4.74% 5.12% 4.28%(4) 5.03% 5.57% 4.35%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (000s
omitted) $463,971 $429,978 $472,675 $416,735 $383,607 $403,211
Ratio of expenses to average net
assets .56%(5) .56%(5) .55%(5,6) .55%(5) .56%(5) .55%
Ratio of net income to average
net assets 4.66% 5.00% 5.11%(6) 4.93% 5.43% 4.41%
Decrease reflected in above
operating expense ratios due to
waivers/reimbursements .12% .12% .12%(6) .14% .16% .19%
</TABLE>

- --------------------------------------------------------------------------------

(1) For the years ended December 31, 1998 and 1999.

(2) For the 10 months ended December 31, 1997. In 1997, the fund changed its
fiscal year-end to December 31.
(3) For the years ended February 28 or 29.
(4) Not annualized.

(5) Interest earned on uninvested cash balances is used to offset part of the
transfer agent expense. These arrangements resulted in a reduction to the
fund's net expense ratio by .01%, .01%, .00%, .00% and .01% for the years
ended December 31, 1998 and 1999, the period ended December 31, 1997 and the
fiscal years ended February 28 or 29, 1997 and 1996, respectively. The
operating expense ratio after reflecting these arrangements was .55% for
each of the years ended December 31, 1998 and 1999, the period ended
December 31, 1997 and the fiscal years ended February 28 or 29, 1997 and
1996, respectively.

(6) Annualized.

<PAGE> 17

NEW YORK TAX EXEMPT FUND

GOAL AND STRATEGIES

The New York Tax Exempt Fund seeks as high a level of current income exempt
from federal, New York state and New York City personal income taxes as is
consistent with preservation of capital and liquidity. The fund seeks to
maintain a stable $1 share price.

Under normal market conditions, the fund will invest at least 65% of assets
in New York municipal securities. In selecting investments, fund managers may
examine the relationships among yields on various types and maturities of
municipal securities in the context of their outlook for interest rates. For
example, if rates are expected to fall, longer maturities may be purchased to
try to preserve the fund's income level. Conversely, shorter maturities may be
favored if rates are expected to rise.
PORTFOLIO INVESTMENTS

This fund invests at least 80% of assets in high-quality short-term tax-
exempt municipal securities. These include:

- tax-exempt commercial paper

- variable-rate demand notes

- bonds

- municipal put bonds

- bond-anticipation notes

- revenue-anticipation notes

This fund's principal risk factors are:

- credit risk

- income risk

- interest-rate risk

- market risk

- New York municipal securities

- non-diversified status

The fund's yield will vary with changes in interest rates. If interest rates
fall, your dividend income will likely decline.

The fund's ability to maintain a stable share price also depends upon
guarantees from banks and other financial institutions that back certain
securities the fund invests in. Changes in the credit quality of these
institutions could cause losses to the fund and affect its share price.

New York state and New York City have at times faced serious economic
problems that have adversely affected New York municipal issuers. The default or
credit-rating downgrade of one of these issuers could affect the market values
and marketability of all New York municipal

16
<PAGE> 18

securities and hurt the fund's yield or share
price. As a result, this fund may be riskier than a more geographically
diversified municipal money-market fund.

Compared to a diversified mutual fund, a non-diversified fund may invest a
greater portion of its assets in the securities of fewer issuers. Because this
fund is non-diversified, it may involve more risk than a diversified
money-market fund.

The fund also may, and currently does, invest in alternative minimum tax
(AMT) securities, the income from which is a tax preference item. "More About
Risk" details these and certain other investment practices the fund may use.
Please read that section carefully before you invest.

PORTFOLIO MANAGEMENT

Under the supervision of CSAM, a portfolio-management team at BlackRock
Institutional Management Corporation, the fund's sub-investment adviser, makes
the fund's day-to-day investment decisions.

INVESTOR EXPENSES

Management fee .37%

All other expenses .18%

-----------
Total expenses .55%

FINANCIAL HIGHLIGHTS
The figures below have been audited by the fund's independent auditors,
PricewaterhouseCoopers LLP.

PERIOD ENDED: 12/99(1) 12/98(1) 12/97(2) 2/97(3) 2/96(3) 2/95(3)
<S> <C> <C> <C> <C> <C> <C>
PER-SHARE DATA
Net asset value, beginning of period $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
Investment activities:
Net investment income 0.03 0.03 0.03 0.03 0.03 0.02
Distributions:
From net investment income (0.03) (0.03) (0.03) (0.03) (0.03) (0.02)
Net asset value, end of period $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
------ ------ ------ ------ ------ ------
------ ------ ------ ------ ------ ------
Total return 2.70% 2.92% 2.64%(4) 2.92% 3.31% 2.48%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (000s omitted) $181,842 $174,743 $151,173 $124,191 $96,584 $77,111
Ratio of expenses to average net assets .56%(5) .55%(5) .55%(5,6) .55%(5) .56%(5) .55%
Ratio of net income to average net assets 2.68% 2.86% 3.12%(6) 2.88% 3.24% 2.46%
Decrease reflected in above
operating expense ratio due to
waivers/reimbursements .13% .14% .12%(6) .17% .27% .27%
</TABLE>

(1) For the years ended December 31, 1998 and 1999.

(2) For the 10 months ended December 31, 1997. In 1997, the fund changed its
fiscal year-end to December 31.
(3) For the years ended February 28 or 29.
(4) Not annualized.

(5) Interest earned on uninvested cash balances is used to offset part of the
transfer agent expense. These arrangements resulted in a reduction to the
fund's net expense ratio by .01%, .00%, .00%, .00% and .01% for the years
ended December 31, 1998 and 1999, the period ended December 31, 1997 and the
fiscal years ended February 28 or 29, 1997 and 1996, respectively. The
operating expense ratio after reflecting these arrangements was .55% for
each of the years ended December 31, 1998 and 1999, the period ended
December 31, 1997 and the fiscal years ended February 28 or 29, 1997 and
1996, respectively.

(6) Annualized.
17
<PAGE> 19

MORE ABOUT RISK

INTRODUCTION

A fund's goal and principal strategies largely determine its risk profile.
You will find a concise description of each fund's risk profile in "Key Points."
The fund-by-fund discussions contain more detailed information. This section
discusses other risks that may affect the funds.

The "Certain Investment Practices" table takes a more detailed look at
certain investment practices the funds may use. Some of these practices may have
higher risks associated with them. However, each fund has limitations and
policies designed to reduce many of the risks.

TYPES OF INVESTMENT RISK

The following risks are referred to throughout this Prospectus.

CREDIT RISK The issuer of a security or the counterparty to a contract may
default or otherwise become unable to honor a financial obligation. An issuer's
failure to make scheduled interest or principal payments to a fund could reduce
the fund's income level and share price.

EXPOSURE RISK The risk associated with investments or practices that increase
the amount of money a fund could gain or lose on an investment.

- HEDGED Exposure risk could multiply losses generated by a practice used
for hedging purposes. Such losses should be substantially offset by gains
on the hedged investment. However, while hedging can reduce or eliminate
losses, it can also reduce or eliminate gains.

- SPECULATIVE To the extent that a derivative or practice is not used as a
hedge, the fund is directly exposed to its risks.

EXTENSION RISK An unexpected rise in interest rates may extend the life of a
mortgage-backed security beyond the expected prepayment time, typically reducing
the security's value.

INCOME RISK A fund's income level may decline because of falling interest
rates.

INTEREST-RATE RISK Changes in interest rates may cause a decline in the
market value of an investment. With bonds and other fixed-income securities, a
rise in interest rates typically causes a fall in values, while a fall in
interest rates typically causes a rise in values.

LIQUIDITY RISK Certain fund securities may be difficult or impossible to sell
at the time and the price that the fund would like. A fund may have to lower the
price, sell other securities instead or forego an investment opportunity. Any of
these could have a negative effect on fund management or performance.

MARKET RISK The market value of a security may move up and down, sometimes
rapidly and unpredictably. Market risk may affect a single issuer, industry,
sector of the economy, or the market as a whole. Market risk is common to most
investments --
18
<PAGE> 20

including debt securities and the mutual funds that invest in them.

POLITICAL RISK Foreign governments may expropriate assets, impose capital or
currency controls, impose punitive taxes, or nationalize a company or industry.
Any of these actions could have a severe effect on security prices and impair a
fund's ability to bring its capital or income back to the U.S. Other political
risks include economic policy changes, social and political instability,
military action and war.

PREPAYMENT RISK Securities with
high stated interest rates may be prepaid prior to maturity. During periods of
falling interest rates, a fund would generally have to reinvest the proceeds at
lower rates.

REGULATORY RISK Governments, agencies or other regulatory bodies may adopt or
change laws or regulations that could adversely affect the issuer, the market
value of the security, or a fund's performance.

VALUATION RISK The lack of an
active trading market may make it difficult to obtain an accurate price for a
fund security.

19
<PAGE> 21

LOGO

CERTAIN INVESTMENT PRACTICES

For each of the following practices, this table shows the applicable investment
limitation. Risks are indicated for each practice.
KEY TO TABLE:

<TABLE>
<S> <C>
f[-] Permitted without limitation; does not indicate
actual use
20% Italic type (e.g., 20%) represents an investment
limitation as a percentage of NET fund assets; does
not indicate actual use
20% Roman type (e.g., 20%) represents an investment
limitation as a percentage of TOTAL fund assets; does
not indicate actual use
[ ] Permitted, but not expected to be used to a
significant extent
- -- Not permitted
</TABLE>

<TABLE>
<S> <C> <C>
INVESTMENT PRACTICE LIMIT
AMT SECURITIES Municipal securities whose interest is a
tax-preference item for purposes of the federal alternative
minimum tax. Credit, liquidity, market, interest-rate,
regulatory risks. [ ] 20%
- ----------------------------------------------------------------------------
EURODOLLAR AND YANKEE OBLIGATIONS U.S. dollar-denominated
certificates of deposit issued or backed by foreign banks
and foreign branches of U.S. banks. Credit, income, interest
rate, market, political risks. [-] [ ]
- ----------------------------------------------------------------------------
INDUSTRY CONCENTRATION -- BANKING Investing more than 25% of
a fund's net assets in obligations of banks and
banking-related companies. Risks affecting the industry will
have a greater effect on the fund. Credit, interest-rate,
market, regulatory risks. [-] --
- ----------------------------------------------------------------------------
MORTGAGE-BACKED AND ASSET-BACKED SECURITIES Debt securities
backed by pools of mortgages, including passthrough
certificates and other senior classes of collateralized
mortgage obligations (CMOs), or other receivables. Credit,
extension, interest-rate, liquidity, prepayment risks. [-] [ ]
- ----------------------------------------------------------------------------
MUNICIPAL SECURITIES Debt obligations issued by or on behalf
of the state of New York and other states and jurisdictions
of the U.S. and their authorities, agencies and
instrumentalities. May include tax-exempt commercial paper,
variable-rate demand notes, bonds, municipal put bonds,
bond-anticipation notes and revenue-anticipation notes.
Credit, interest-rate, market risks. [ ] [-]
- ----------------------------------------------------------------------------
REPURCHASE AGREEMENTS The purchase of a security with a
commitment to resell the security back to the counterparty
at the same price plus interest. Credit risk. [-] [ ]
- ----------------------------------------------------------------------------
RESTRICTED AND OTHER ILLIQUID SECURITIES Securities with
restrictions on trading, or those not actively traded. May
include private placements. Liquidity, market, valuation
risks. 10% 10%
- ----------------------------------------------------------------------------
</TABLE>

20
<PAGE> 22

LOGO

INVESTMENT PRACTICE LIMIT
TEMPORARY DEFENSIVE TACTICS Placing some or all of a fund's
assets in defensive investments when the investment adviser
or sub-investment adviser believes that doing so would be in
the best interests of fund shareholders. For the New York
Tax Exempt Fund, these investments may include taxable
securities and municipal securities that are not exempt from
New York state and New York City taxes. Although intended to
avoid losses in unusual market conditions, defensive tactics
might prevent a fund from achieving its goal. [ ] [ ]
- ----------------------------------------------------------------------------
VARIABLE-RATE MASTER DEMAND NOTES Unsecured instruments that
provide for periodic adjustments in their interest rate and
permit the indebtedness of the issuer to vary. Credit,
interest-rate, liquidity, market risks. [ ] [-]
- ----------------------------------------------------------------------------
WHEN-ISSUED SECURITIES AND FORWARD COMMITMENTS The purchase
or sale of securities for delivery at a future date; market
value may change before delivery. Liquidity, market,
speculative exposure risks. 20% 20%
- ----------------------------------------------------------------------------
</TABLE>

21
<PAGE> 23

ABOUT YOUR ACCOUNT

SHARE VALUATION

The price of your shares is also referred to as their net asset value (NAV).

The NAV is determined at 12:00 noon and at the close of regular trading on
the New York Stock Exchange (NYSE) (usually 4 p.m. Eastern Time) each day the
NYSE is open for business. It is calculated by dividing a fund's total assets,
less its liabilities, by the number of shares outstanding.

Each fund values its securities using amortized cost. This method values a
fund holding initially at its cost and then assumes a constant amortization to
maturity of any discount or premium. The amortized cost method ignores any
impact of fluctuating interest rates.

BUYING AND
SELLING SHARES

The accompanying Shareholder
Guide explains how to invest directly with the funds. You will find additional
information about purchases, redemptions, exchanges and services.

Each fund is open on those days when the NYSE is open, typically Monday
through Friday. Your transaction will be priced at the NAV next computed after
we receive your request in proper form.

Each fund reserves the right to:

- modify or terminate the check-redemption privilege

- limit the number of check redemptions

- begin charging a fee for checks

ACCOUNT STATEMENTS

In general, you will receive account statements as follows:

- after every transaction that affects your account balance (except for
distribution reinvestments and automatic transactions)

- after any changes of name or address of the registered owner(s)

- otherwise, every quarter

You will also receive annual and semiannual financial reports.

DISTRIBUTIONS

As a fund investor, you will receive distributions.

Each fund may earn interest from its bond, money-market and other
investments. These are passed along as dividend distributions. A fund realizes
capital gains whenever it sells securities for a higher price than it paid for
them. These are passed along as capital-gain distributions. Money-market funds
usually do not make capital-gain distributions.

The funds declare dividend distributions daily and pay them monthly. Each of
the funds typically distributes long-term capital gains (if any) to shareholders
annually, at the end of its fiscal year. The New York Tax Exempt Fund
distributes short-term capital gains (if any) at the end of its fiscal year; the
Cash Reserve Fund distributes them
22
<PAGE> 24

periodically as determined by the Board of Directors.

Most investors have their distributions reinvested in additional shares of
the same fund. Alternatively, you can choose to have a check for your
distributions mailed to you or sent by electronic transfer. Distributions will
be reinvested unless you select another option on your account application.

TAXES

As with any investment, you should consider how your investment in a fund
will be taxed. If your account is not a tax-advantaged retirement account, you
should be especially aware of the following potential tax implications. Please
consult your tax professional concerning your own tax situation.

Each fund intends to meet the requirements for being a tax-qualified
regulated investment company. As long as a fund continues to qualify, it pays no
federal income tax on the earnings it distributes to shareholders.

Any time you sell or exchange shares, it is considered a taxable event for
you. Because each fund seeks to maintain a stable $1 share price, you should not
realize a taxable gain or loss when you sell shares.

The Form 1099 that is mailed to you every January details your distributions
and their federal-tax category.

CASH RESERVE FUND

Distributions you receive from the Cash Reserve Fund, whether reinvested or
taken in cash, are generally considered taxable. The fund does not expect to
realize long-term capital gains or make capital-gain distributions.
Distributions from other sources are generally taxed as ordinary income.

Depending on provisions in your state's tax law, the portion of the fund's
income derived from "full faith and credit" U.S. Treasury obligations may be
exempt from state and local taxes. The fund will indicate each year the portion
of its income, if any, that may qualify for this exemption.

NEW YORK TAX EXEMPT FUND

Interest income that the fund earns is distributed to shareholders as income
dividends. Interest that is federally tax-free when received by the fund remains
tax-free when it is distributed.

However, gain on the sale of tax-free securities results in taxable
distributions. Short-term capital gains and a portion of the gain on bonds
purchased at a discount are distributed as dividends and taxed as ordinary
income. Although the fund does not expect to make them, long-term capital-gain
distributions would be taxed as long-term capital gains. Distributions of
capital gains are taxable whether you take them in cash or reinvest them.

The interest from some municipal securities is subject to the federal
alternative minimum tax. The fund may invest up to 100% of its assets in these
securities during temporary defensive periods. Individuals who are subject to
the tax must report this interest on their
23
<PAGE> 25

tax returns. In addition, the fund may invest a portion of its assets in
securities that generate income that is not exempt from federal income tax.

To the extent that the fund's income dividends are derived from state
tax-free investments, they will be free from New York state and City personal
income taxes. The fund will indicate each year the portion of its dividends that
may qualify for this exemption. Corporate taxpayers should note that the fund's
income dividends and other distributions are not exempt from New York state and
City franchise or corporate income taxes.

24
<PAGE> 26

OTHER INFORMATION

ABOUT THE DISTRIBUTOR

Provident Distributors, Inc. (PDI), located at 3200 Horizon Drive, King of
Prussia, PA 19406, is the funds' distributor and is responsible for making the
funds available to you. PDI is not affiliated with CSAM.

25
<PAGE> 27

This page intentionally left blank

26
<PAGE> 28
FOR MORE INFORMATION

More information about these funds is available free upon request, including
the following:
SHAREHOLDER GUIDE

Explains how to buy and sell shares. The Shareholder Guide is incorporated by
reference into (is legally part of )
this Prospectus.

ANNUAL/SEMIANNUAL REPORTS TO SHAREHOLDERS

Includes financial statements, portfolio investments and detailed performance
information.

The Annual Report also contains a letter from the fund's manager discussing
market conditions and investment strategies that significantly affected fund
performance during its past fiscal year.

OTHER INFORMATION

A current Statement of Additional Information (SAI), which provides more
details about the funds, is on file with the Securities and Exchange Commission
(SEC) and is incorporated by reference.

You may visit the SEC's Internet Web site (www.sec.gov) to view the SAI,
material incorporated by reference, and other information. You can also obtain
copies by visiting the SEC's Public Reference Room in Washington, DC (phone
202-942-8090) or by sending your request and a duplicating fee to the SEC's
Public Reference Section, Washington, DC 20549-6009 or electronically at
[email protected].

Please contact Warburg Pincus Funds to obtain information, without charge,
the SAI and Annual and Semiannual Reports and to make shareholder inquiries:

BY TELEPHONE:
800-WARBURG
(800-927-2874)

BY MAIL:
Warburg Pincus Funds
P.O. Box 9030
Boston, MA 02205-9030

BY OVERNIGHT OR COURIER SERVICE:
Boston Financial
Attn: Warburg Pincus Funds

66 Brooks Drive

Braintree, MA 02184

ON THE INTERNET:
www.warburg.com

SEC FILE NUMBERS:

Warburg Pincus Cash Reserve Fund 811-04171

Warburg Pincus New York Tax
Exempt Fund 811-04170

[Warburg Pincus Funds Logo]
P.O. BOX 9030, BOSTON, MA 02205-9030
800-WARBURG (800-927-2874) - www.warburg.com

PROVIDENT DISTRIBUTORS, INC., DISTRIBUTOR. WPMMF-1-0500

<PAGE> 29

[Warburg Pincus Funds Logo][Credit Suisse Asset Management Logo]

WARBURG PINCUS FUNDS
SHAREHOLDER
GUIDE

Common Class
February 29, 2000
As Revised March 27, 2000

This Shareholder Guide is incorporated into and legally part of each
Warburg Pincus (Common Class) prospectus.

Warburg Pincus Funds are advised by Credit Suisse Asset Management, LLC
<PAGE> 30

BUYING SHARES

OPENING AN ACCOUNT

Your account application provides us with key information we need to set up
your account correctly. It also lets you authorize services that you may find
convenient in the future.

If you need an application, call our Shareholder Service Center to receive
one by mail or fax. Or you can download it from our Internet Web site:
www.warburg.com.

You can make your initial investment by check or wire. The "By Wire" method
in the table enables you to buy shares on a particular day at that day's closing
NAV.

ADDING TO AN ACCOUNT

You can add to your account in a variety of ways, as shown in the table. If
you want to use ACH transfer, be sure to complete the "ACH on Demand" section of
the account application.

INVESTMENT CHECKS

Please use either a personal or bank check payable in U.S. dollars to Warburg
Pincus Funds. Unfortunately, we cannot accept "starter" checks that do not have
your name preprinted on them. We also cannot accept checks payable to you or to
another party and endorsed to the order of Warburg Pincus Funds. These types of
checks may be returned to you and your purchase order may not be processed.
Limited exceptions include properly endorsed government checks.

MINIMUM INITIAL INVESTMENT

<TABLE>
<S> <C>
Cash Reserve Fund: $ 1,000
New York Tax Exempt
Fund: $ 1,000
Balanced Fund: $ 1,000
Value Fund: $ 1,000
WorldPerks(R) Funds: $ 5,000
Long-Short Fund: $ 25,000
All other funds: $ 2,500
IRAs: $ 500*
Transfers/Gifts to
Minors: $ 500*
</TABLE>

* $25,000 minimum for Long-Short Fund.

WIRE INSTRUCTIONS

State Street Bank and Trust Company
ABA# 0110 000 28
Attn: Mutual Funds/Custody Dept.
[Warburg Pincus Fund Name]
DDA# 9904-649-2
F/F/C: [Account Number and Registration]

HOW TO REACH US

SHAREHOLDER SERVICE CENTER
Toll free: 800 -WARBURG
(800 -927-2874)
Fax: 212-370-9833

MAIL
Warburg Pincus Funds
P.O. Box 9030
Boston, MA 02205-9030

OVERNIGHT/COURIER SERVICE
Boston Financial
Attn: Warburg Pincus Funds
66 Brooks Drive
Braintree, MA 02184

INTERNET WEB SITE
www.warburg.com
2
<PAGE> 31

<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------
OPENING AN ACCOUNT ADDING TO AN ACCOUNT
<S> <C>
- ---------------------------------------------------------------------------------------
BY CHECK
- ---------------------------------------------------------------------------------------
- - Complete the New Account Application. - Make your check payable to Warburg
For IRAs use the Universal IRA Pincus Funds.
Application. - Write the account number and the fund
- - Make your check payable to Warburg name on your check.
Pincus Funds. - Mail to Warburg Pincus Funds.
- - Mail to Warburg Pincus Funds. - Minimum amount is $100.
- ---------------------------------------------------------------------------------------
BY EXCHANGE
- ---------------------------------------------------------------------------------------
- - Call our Shareholder Service Center to - Call our Shareholder Service Center to
request an exchange. Be sure to read request an exchange.
the current prospectus for the new - Minimum amount is $250.
fund. Also please observe the minimum If you do not have telephone privileges,
initial investment. mail or fax a signed letter of
If you do not have telephone privileges, instruction.
mail or fax a signed letter of
instruction.
- ---------------------------------------------------------------------------------------
BY WIRE
- ---------------------------------------------------------------------------------------
- - Complete and sign the New Account - Call our Shareholder Service Center by
Application. 4 p.m. ET to inform us of the incoming
- - Call our Shareholder Service Center and wire. Please be sure to specify your
fax the signed New Account Application name, the account number and the fund
by 4 p.m. ET. name on your wire advice.
- - Shareholder Services will telephone you - Wire the money for receipt that day.
with your account number. Please be - Minimum amount is $500.
sure to specify your name, the account
number and the fund name on your wire
advice.
- - Wire your initial investment for
receipt that day.
- - Mail the original, signed application
to Warburg Pincus Funds.
This method is not available for IRAs.
- ---------------------------------------------------------------------------------------
BY AUTOMATED CLEARING HOUSE (ACH) TRANSFER
- ---------------------------------------------------------------------------------------
- - Cannot be used to open an account. - Call our Shareholder Service Center to
request an ACH transfer from your bank.
- Your purchase will be effective at the
next NAV calculated after we receive your
order in proper form.
- Minimum amount is $50.
Requires ACH on Demand privileges.
- ---------------------------------------------------------------------------------------
</TABLE>

800-WARBURG (800-927-2874)
MONDAY - FRIDAY, 8 A.M. - 8 P.M. ET SATURDAY, 8 A.M. - 4 P.M. ET
3
<PAGE> 32

SELLING SHARES(*)

<TABLE>
<CAPTION>
SELLING SOME OR ALL OF YOUR SHARES CAN BE USED FOR
<S> <C>
BY MAIL

Write us a letter of instruction that - Accounts of any type.
includes: - Sales of any amount.
- - your name(s) and signature(s) For IRAs please use the IRA Distribution
- - the fund name and account number Request Form.
- - the dollar amount you want to sell
- - how to send the proceeds
Obtain a signature guarantee or other
documentation, if required (see "Selling
Shares in Writing").
Mail the materials to Warburg Pincus
Funds.
If only a letter of instruction is
required, you can fax it to the
Shareholder Service Center.
BY EXCHANGE
- - Call our Shareholder Service Center to - Accounts with telephone privileges.
request an exchange. Be sure to read If you do not have telephone privileges,
the current prospectus for the new fund. mail or fax a letter of instruction to
Also please observe the minimum initial exchange shares.
investment.
BY PHONE

Call our Shareholder Service Center to - Non-IRA accounts with telephone
request a redemption. You can receive the privileges.
proceeds as:
- - a check mailed to the address of record
- - an ACH transfer to your bank ($50
minimum)
- - a wire to your bank ($500 minimum)
See "By Wire or ACH Transfer" for
details.
BY WIRE OR ACH TRANSFER
- - Complete the "Wire Instructions" or - Non-IRA accounts with wire-redemption
"ACH on Demand" section of your New or ACH on Demand privileges.
Account Application. - Requests by phone or mail.
- - For federal-funds wires, proceeds will
be wired on the next business day. For
ACH transfers, proceeds will be
delivered within two business days.
</TABLE>

()* For the Japan Growth Fund and Japan Small Company Fund only: Each fund
imposes a 2.00% redemption fee (short-term trading fee) on fund shares redeemed
or exchanged less than six months from purchase. This fee is calculated based on
the shares' net asset value at redemption and deducted from the redemption
proceeds. The fee is paid to the fund to offset costs associated with short-term
shareholder trading. It does not apply to shares acquired through reinvestment
of distributions. For purposes of computing the redemption fee, any shares
bought through reinvestment of distributions will be redeemed first without
charging the fee, followed by the shares held longest. The redemption fee
applies to fund shares purchased on or after May 30, 2000. The Japan Small
Company Fund imposes a 1.00% redemption fee on fund shares purchased during the
period November 17, 1999 through May 29, 2000 and redeemed or exchanged less
than six months from purchase.
4
<PAGE> 33

SELLING SHARES IN WRITING

Some circumstances require a written sell order, along with a signature
guarantee. These include:

- accounts whose address of record has been changed within the past 30 days

- redemption in certain large amounts (other than by exchange)

- requests to send the proceeds to a different payee or address

- shares represented by certificates, which must be returned with your sell
order

A signature guarantee helps protect against fraud. You can obtain one from
most banks or securities dealers, but not from a notary public.

RECENTLY PURCHASED SHARES

For fund shares purchased other than by bank wire, bank check, U.S. Treasury
check, certified check or money order, the funds will delay payment of your cash
redemption proceeds for 10 calendar days from the day of purchase. At any time
during this period, you may exchange into another fund.

LOW-BALANCE ACCOUNTS

If your account balance falls below the minimum required to keep it open due
to redemptions or exchanges, the fund may ask you to increase your balance. If
it is still below the minimum after 60 days, the fund may close your account and
mail you the proceeds.

MINIMUM TO KEEP AN ACCOUNT OPEN

<TABLE>
<S> <C>
Cash Reserve Fund: $ 750
New York Tax Exempt Fund: $ 750
Balanced Fund: $ 500
Value Fund: $ 500
WorldPerks Funds: $ 750
All other funds: $ 2,000
IRAs: $ 250
Transfers/Gifts to
Minors: $ 250
</TABLE>

800-WARBURG (800-927-2874)
MONDAY - FRIDAY, 8 A.M. - 8 P.M. ET SATURDAY, 8 A.M. - 4 P.M. ET
5
<PAGE> 34

SHAREHOLDER SERVICES

AUTOMATIC SERVICES

Buying or selling shares automatically is easy with the services described
below. You can set up most of these services with your account application or by
calling our Shareholder Service Center.

SAVEMYMONEY PROGRAM

SaveMyMoney(SM) is a low minimum, automatic investing program that makes it
easy to build a mutual fund portfolio. For an initial investment of $250 along
with a minimum $50 monthly investment, you can invest in certain Warburg Pincus
funds. The SaveMyMoney Program will automatically transfer the monthly
investment amount you designate from your bank account.

AUTOMATIC MONTHLY INVESTMENT PLAN

For making automatic investments ($50 minimum) from a designated bank
account.

AUTOMATIC WITHDRAWAL PLAN

For making automatic monthly, quarterly, semiannual or annual withdrawals of
$250 or more.

DISTRIBUTION SWEEP

For automatically reinvesting your dividend and capital-gain distributions
into another identically registered Warburg Pincus fund. Not available for IRAs.

RETIREMENT PLANS

Warburg Pincus offers a range of tax-advantaged retirement accounts,
including:

- Traditional IRAs

- Roth IRAs

- Roth Conversion IRAs

- Spousal IRAs

- Rollover IRAs

- SEP IRAs

To transfer your IRA to Warburg Pincus, use the IRA Transfer/Direct Rollover
Form. If you are opening a new IRA, you will also need to complete the Universal
IRA Application. Please consult your tax professional concerning your IRA
eligibility and tax situation.

TRANSFERS/GIFTS TO MINORS

Depending on state laws, you can set up a custodial account under the Uniform
Transfers-to-Minors Act (UTMA) or the Uniform Gifts-to-Minors Act (UGMA). Please
consult your tax professional about these types of accounts.

ACCOUNT CHANGES

Call our Shareholder Service Center to update your account records whenever
you change your address. Shareholder Services can also help you change your
account information or privileges.

6
<PAGE> 35

OTHER POLICIES

TRANSACTION DETAILS

You are entitled to capital-gain and earned dividend distributions as soon as
your purchase order is executed. For the Intermediate Maturity Government, New
York Intermediate Municipal and Fixed Income Funds and the Money Market Funds,
you begin to earn dividend distributions the business day after your purchase
order is executed. However, if we receive your purchase order and payment to
purchase shares of a Money Market Fund before 12 p.m. (noon), you begin to earn
dividend distributions on that day.
Your purchase order will be canceled and you may be liable for losses or fees
incurred by the fund if:

- your investment check or ACH transfer does not clear

- you place a telephone order by 4 p.m. ET and we do not receive your wire that
day
If you wire money without first calling Shareholder Services to place an
order, and your wire arrives after the close of regular trading on the NYSE,
then your order will not be executed until the end of the next business day. In
the meantime, your payment will be held uninvested. Your bank or other
financial-services firm may charge a fee to send or receive wire transfers.
While we monitor telephone servicing resources carefully, during periods of
significant economic or market change it may be difficult to place orders by
telephone.
Uncashed redemption or distribution checks do not earn interest.

SPECIAL SITUATIONS

A fund reserves the right to:

- refuse any purchase or exchange request, including those from any person or
group who, in the fund's view, is likely to engage in excessive trading

- change or discontinue its exchange privilege after 30 days' notice to current
investors, or temporarily suspend this privilege during unusual market
conditions

- change its minimum investment amounts after 15 days' notice to current
investors of any increases

- charge a wire-redemption fee

- make a "redemption in kind"--payment in portfolio securities rather than
cash--for certain large redemption amounts that could hurt fund operations

- suspend redemptions or postpone payment dates as permitted by the Investment
Company Act of 1940 (such as during periods other than weekends or holidays
when the NYSE is closed or trading on the NYSE is restricted, or any other
time that the SEC permits)

- modify or waive its minimum investment requirements for investments through
certain financial-services firms and for employees and clients of its adviser,
sub-adviser, distributor and their affiliates and, for the Long-Short Fund,
investments through certain financial-services firms ($10,000 minimum) and
through retirement plan programs (no minimum)

- stop offering its shares for a period of time (such as when management
believes that a substantial increase in assets could adversely affect it)

800-WARBURG (800-927-2874)
MONDAY - FRIDAY, 8 A.M. - 8 P.M. ET SATURDAY, 8 A.M. - 4 P.M. ET

7
<PAGE> 36

[WARBURG PINCUS FUNDS LOGO]

P.O. BOX 9030, BOSTON, MA 02205-9030
800-WARBURG (800-927-2874) - www.warburg.com
PROVIDENT DISTRIBUTORS, INC., DISTRIBUTOR WPCOM-31-0300
<PAGE> 37

STATEMENT OF ADDITIONAL INFORMATION

MAY 1, 2000

WARBURG PINCUS CASH RESERVE FUND

WARBURG PINCUS NEW YORK TAX EXEMPT FUND

This combined Statement of Additional Information provides information about
Warburg Pincus Cash Reserve Fund (the "Cash Reserve Fund") and Warburg Pincus
New York Tax Exempt Fund (the "Tax Exempt Fund" and collectively with the Cash
Reserve Fund, the "Funds") which supplements the information that is contained
in the combined Prospectus of the Funds, dated May 1, 2000.

Each Fund's audited annual report dated December 31, 1999, which either
accompanies this Statement of Additional Information or has previously been
provided to the investor to whom this Statement of Additional Information is
being sent, is incorporated herein by reference.

This Statement of Additional Information is not a prospectus and should be read
in conjunction with the Prospectus. Copies of the Prospectus and the Annual
Report can be obtained by writing or telephoning:

Warburg Pincus Funds

P.O. Box 9030

Boston, Massachusetts 02205-9030

800-WARBURG

<PAGE> 38

Table of Contents

<TABLE>
<CAPTION>
Page
----

<S> <C>
INVESTMENT OBJECTIVES...................................................................................1
GENERAL.................................................................................................1
Price and Portfolio Maturity................................................................1
Portfolio Quality and Diversification.......................................................1
INVESTMENT POLICIES.....................................................................................2
Municipal Securities........................................................................2
Bank Obligations............................................................................3
Variable Rate Master Demand Notes...........................................................3
Government Securities.......................................................................4
When-Issued Securities......................................................................4
Repurchase Agreements.......................................................................5
Reverse Repurchase Agreements and Borrowings................................................5
Stand-By Commitment Agreements..............................................................5
Third Party Puts............................................................................6
Taxable Investments.........................................................................7
Alternative Minimum Tax Bonds...............................................................7
Other Investment Policies and Practices of the New York Tax Exempt Fund.....................8
Non-Diversified Status................................................................8
Special Considerations and Risk Factors...............................................8
Other Investment Limitations................................................................9
Cash Reserve Fund.....................................................................9
New York Tax Exempt Fund.............................................................11
PORTFOLIO VALUATION....................................................................................12
PORTFOLIO TRANSACTIONS.................................................................................12
SPECIAL CONSIDERATIONS RELATING TO NEW YORK MUNICIPAL SECURITIES......................................13
State Economy..............................................................................14
State Budget...............................................................................14
Debt Limits and Outstanding Debt...........................................................17
Litigation.................................................................................18
Authorities................................................................................20
New York City and Other Localities.........................................................20
Year 2000 Compliance.......................................................................23
MANAGEMENT OF THE FUNDS................................................................................24
Officers and Board of Directors............................................................24
Directors' Compensation....................................................................27
Investment Adviser, Sub-Investment Adviser and Administratorand Co-Administrator...........27
Banking Laws...............................................................................29
Custodian and Transfer Agent...............................................................30
Organization of the Fund...................................................................30
</TABLE>

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<PAGE> 39

Table of Contents

<TABLE>
<CAPTION>
Page
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<S> <C>
ADDITIONAL PURCHASE AND REDEMPTION INFORMATION.........................................................31
Automatic Cash Withdrawal Plan.............................................................32
EXCHANGE PRIVILEGE.....................................................................................32
ADDITIONAL INFORMATION CONCERNING TAXES................................................................32
DETERMINATION OF YIELD.................................................................................36
INDEPENDENT ACCOUNTANTS AND COUNSEL....................................................................36
MISCELLANEOUS..........................................................................................37
FINANCIAL STATEMENTS...................................................................................38
APPENDIX................................................................................................i
Description of Commercial Paper Ratings.....................................................i
Description of Municipal Securities Ratings................................................ii
</TABLE>

(2)
<PAGE> 40

INVESTMENT OBJECTIVES

The following information supplements the discussion of each Fund's
investment objective and policies in the Prospectus. There are no assurances
that the Funds will achieve their investment objectives.

The investment objective of the Cash Reserve Fund is to provide
investors with high current income consistent with liquidity and stability of
principal.

The investment objective of the New York Tax Exempt Fund is to provide
investors with as high a level of current income that is excluded from gross
income for federal income tax purposes and exempt from New York State and New
York City personal income taxes as is consistent with preservation of capital
and liquidity.

Unless otherwise indicated, each Fund is permitted to engage in the
following investment strategies. The Funds are not obligated to pursue any of
the following strategies and do not represent that these techniques are
available now or will be available at any time in the future.

GENERAL

Price and Portfolio Maturity. Each Fund invests only in securities which
are purchased with and payable in U.S. dollars and which have (or, pursuant to
regulations adopted by the Securities and Exchange Commission (the "SEC"), are
deemed to have) remaining maturities of 397 calendar days or less at the date
of purchase by the Fund. For this purpose, variable rate master demand notes
(as described below), which are payable on demand, or, under certain
conditions, at specified periodic intervals not exceeding 397 calendar days, in
either case on not more than 30 days' notice, will be deemed to have remaining
maturities of 397 calendar days or less. Each Fund maintains a dollar-weighted
average portfolio maturity of 90 days or less. Each Fund follows these policies
to maintain a constant net asset value of $1.00 per share, although there is no
assurance that it can do so on a continuing basis.

Portfolio Quality and Diversification. Each Fund will limit its
portfolio investments to securities that its Board determines present minimal
credit risks and which are "Eligible Securities" at the time of acquisition by
the Fund. The term Eligible Securities includes securities rated by the
"Requisite NRSROs" in one of the two highest short-term rating categories,
securities of issuers that have received such ratings with respect to other
short-term debt securities and comparable unrated securities. "Requisite
NRSROs" means (i) any two nationally recognized statistical rating
organizations ("NRSROs") that have issued a rating with respect to a security
or class of debt obligations of an issuer, or (ii) one NRSRO, if only one NRSRO
has issued a rating with respect to such security or issuer at the time that
the Fund acquires the security. The Funds may purchase securities that are
unrated at the time of purchase that a Fund's investment adviser and
sub-investment adviser deem to be of comparable quality to rated securities
that the Fund may purchase. The NRSROs currently designated as such by the

<PAGE> 41

SEC are Standard & Poor's Ratings Services ("S&P"), Moody's Investors Service,
Inc. ("Moody's"), Fitch Investors Services, Inc., Duff and Phelps, Inc. and
IBCA Limited and its affiliate, IBCA, Inc. A discussion of the ratings
categories of the NRSROs is contained in the Appendix to the Fund's Statement
of Additional Information.

The Funds have adopted certain credit quality, maturity and
diversification requirements under Rule 2a-7 under the Investment Company Act
of 1940, as amended (the "1940 Act"), as operating policies. Under these
policies, there are two tiers of Eligible Securities, first and second tier,
based on their ratings by NRSROs or, if the securities are unrated, on
determinations by a Fund's investment adviser and sub-investment adviser. These
policies generally restrict a Fund from investing more than 5% of its assets in
second tier securities and limit to 5% of assets the portion that may be
invested in any one issuer. The Tax Exempt Fund may invest up to 25% of its
assets without regard to this per issuer limit. In addition, the credit quality
and diversification policies vary to some extent between the Cash Reserve and
Tax Exempt Funds because the Tax Exempt Fund is a single-state tax exempt fund.

INVESTMENT POLICIES

Municipal Securities. Under normal circumstances, substantially all of
the New York Tax Exempt Fund's assets will be invested in Municipal Securities.
Municipal Securities include short-term debt obligations issued by governmental
entities to obtain funds for various public purposes, including the
construction of a wide range of public facilities, the refunding of outstanding
obligations, the payment of general operating expenses and the extension of
loans to public institutions and facilities. Private activity securities that
are issued by or on behalf of public authorities to finance various
privately-operated facilities are included within the term Municipal Securities
if the interest paid thereon is exempt from federal income tax.

The two principal types of Municipal Securities consist of "general
obligation" and "revenue" issues, and the New York Tax Exempt Fund's portfolio
may include "moral obligation" issues, which are normally issued by special
purpose authorities. General obligation bonds are secured by the issuer's
pledge of its full faith, credit and taxing power for the payment of principal
and interest. Revenue bonds are payable only from the revenues derived from a
particular facility or class of facilities or in some cases, from the proceeds
of a special excise tax or other specific revenue source such as the user of
the facility being financed. Private activity securities held by the Fund are
in most cases revenue bonds and are not payable from the unrestricted revenues
of the issuer. Consequently, the credit quality of such private activity
securities is usually directly related to the credit standing of the corporate
user of the facility involved.

There are, of course, variations in the quality of Municipal Securities,
both within a particular classification and between classifications, and the
yields on Municipal Securities depend upon a variety of factors, including
general money market conditions, the financial condition of the issuer, general
conditions of the municipal bond market, the size of a particular offering, the
maturity of the obligation and the rating of the issue. The ratings of rating
agencies represent their opinions as to the quality of Municipal Securities. It
should be emphasized,

- - 2 -
<PAGE> 42

however, that ratings are general and are not absolute standards of quality,
and Municipal Securities with the same maturity, interest rate and rating may
have different yields while Municipal Securities of the same maturity and
interest rate with different ratings may have the same yield. Subsequent to its
purchase by the New York Tax Exempt Fund, an issue of Municipal Securities may
cease to be rated or its rating may be reduced below the minimum rating
required for purchase by the Fund. The Fund's investment adviser and
sub-investment adviser will consider such an event in determining whether the
Fund should continue to hold the obligation. See the Appendix attached hereto
for further information concerning ratings and their significance.

An issuer's obligations under its Municipal Securities are subject to
the provisions of bankruptcy, insolvency and other laws affecting the rights
and remedies of creditors, such as the Federal Bankruptcy Code, and laws, if
any, which may be enacted by federal or state legislatures extending the time
for payment of principal or interest, or both, or imposing other constraints
upon enforcement of such obligations or upon the ability of municipalities to
levy taxes. There is also the possibility that as a result of litigation or
other conditions, the power or ability of any one or more issuers to pay, when
due, principal of and interest on its, or their, Municipal Securities may be
materially adversely affected.

Among other instruments, the New York Tax Exempt Fund may purchase
short-term Tax Anticipation Notes, Bond Anticipation Notes, Revenue
Anticipation Notes and other forms of short-term loans. Such notes are issued
with a short-term maturity in anticipation of the receipt of tax funds, the
proceeds of bond placements or other revenues.

- - 3 -
<PAGE> 43

Bank Obligations. The Cash Reserve Fund may purchase bank obligations,
including United States dollar-denominated instruments issued or supported by
the credit of the United States or foreign banks or savings institutions having
total assets at the time of purchase in excess of $1 billion. While the Cash
Reserve Fund will invest in obligations of foreign banks or foreign branches of
United States banks only if the Fund's investment adviser and sub-investment
adviser deem the instrument to present minimal credit risks, such investments
may nevertheless entail risks that are different from those of investments in
domestic obligations of United States banks due to differences in political,
regulatory and economic systems and conditions. Such risks include future
political and economic developments, the possible imposition of withholding
taxes on interest income, possible establishment of exchange controls or the
adoption of other foreign governmental restrictions which might adversely
affect the payment of principal and interest on such obligations. The Cash
Reserve Fund may also make interest-bearing savings deposits in commercial and
savings banks in amounts not in excess of 5% of its assets.

- - 4 -
<PAGE> 44

Variable Rate Master Demand Notes. Each Fund may also purchase variable
rate master demand notes, which are unsecured instruments that permit the
indebtedness thereunder to vary and provide for periodic adjustments in the
interest rate. Although the notes are not normally traded and there may be no
secondary market in the notes, the Fund may demand payment of principal and
accrued interest at any time and may resell the note at any time to a third
party. In the event an issuer of a variable rate master demand note defaulted on
its payment obligation, the Fund might be unable to dispose of the note because
of the absence of a secondary market and might, for this or other reasons,
suffer a loss to the extent of the default.

Variable rate master demand notes held by a Fund may have maturities of
more than thirteen months, provided: (i) the Fund is entitled to payment of
principal and accrued interest upon not more than seven days' notice and (ii)
the rate of interest on such notes is adjusted automatically at periodic
intervals which may extend up to thirteen months. In determining the Fund's
average weighted portfolio maturity and whether a variable rate master demand
note has a remaining maturity of thirteen months or less, each note will be
deemed by the Fund to have a maturity equal to the longer of the period
remaining until its next interest rate adjustment or the period remaining until
the principal amount owed can be recovered through demand. In determining
whether an unrated variable rate master demand note is of comparable quality at
the time of purchase to instruments rated "high quality" by any major rating
service or when purchasing variable rate master demand notes, the Fund's
investment adviser and sub-investment adviser will consider the earning power,
cash flow and other liquidity ratios of the issuer of the note and will
continuously monitor its financial condition. In addition, when necessary to
ensure that a note is of "high quality," the Fund will require that the
issuer's obligation to pay the principal of the note be backed by an
unconditional bank letter of line of credit, guarantee or commitment to lend.

In the event an issuer of a variable rate master demand note defaults on
its payment obligation, a Fund might be unable to dispose of the note because
of the absence of a secondary market and might, for this or other reasons,
suffer a loss to the extent of the default. However, the Fund will invest in
such instruments only where its investment adviser and sub-investment adviser
believe that the risk of such loss is minimal. In determining average weighted
portfolio maturity, a variable rate master demand note will be deemed to have a
maturity equal to the longer of the period remaining to the next interest rate
adjustment or the demand note period.

Government Securities. Government Securities in which the Funds may
invest include Treasury Bills, Treasury Notes and Treasury Bonds; other
obligations that are supported by the full faith and credit of the United
States Treasury, such as Government National Mortgage Association pass-through
certificates; obligations that are supported by the right of the issuer to
borrow from the Treasury, such as securities of Federal Home Loan Banks; and
obligations that are supported only by the credit of the instrumentality, such
as Federal National Mortgage Association bonds.

When-Issued Securities. A Fund may purchase Municipal Securities or
portfolio securities, as the case may be, on a "when-issued" basis (i.e., for
delivery beyond the normal settlement date at a stated price and yield). Each
Fund may purchase portfolio securities on a

- - 5 -
<PAGE> 45

"when-issued" basis. When-issued securities are securities purchased for
delivery beyond the normal settlement date at a stated price and yield. A Fund
will generally not pay for such securities or start earning interest on them
until they are received. Securities purchased on a when-issued basis are
recorded as an asset and are subject to changes in value based upon changes in
the general level of interest rates. Each Fund expects that commitments to
purchase when-issued securities will not exceed 25% of the value of its total
assets absent unusual market conditions, and that a commitment by the Fund to
purchase when-issued securities will generally not exceed 45 days. The Funds do
not intend to purchase when-issued securities for speculative purposes but only
in furtherance of their investment objectives.

When the Fund agrees to purchase when-issued securities, its custodian
will set aside cash or liquid securities in a segregated account equal to the
amount of the commitment. Normally, the custodian will set aside portfolio
securities to satisfy a purchase commitment, and in such a case the Fund may be
required subsequently to place additional assets in the segregated account in
order to ensure that the value of the account remains equal to the amount of
the Fund's commitment. It may be expected that the Fund's net assets will
fluctuate to a greater degree when it sets aside portfolio securities to cover
such purchase commitments than when it sets aside cash. Because the Fund will
set aside cash and liquid assets to satisfy its purchase commitments in the
manner described, the Fund's liquidity and ability to manage its portfolio
might be affected in the event its commitments to purchase when-issued
securities ever exceeded 25% of the value of its assets.

When a Fund engages in when-issued transactions, it relies on the seller
to consummate the trade. Failure of the seller to do so may result in the
Fund's incurring a loss or missing an opportunity to obtain a price considered
to be advantageous.

Repurchase Agreements. Each Fund may agree to purchase money market
instruments from financial institutions such as banks and broker-dealers
subject to the seller's agreement to repurchase them at an agreed-upon date and
price ("repurchase agreements"). The repurchase price generally equals the
price paid by the Fund plus interest negotiated on the basis of current
short-term rates (which may be more or less than the rate on the securities
underlying the repurchase agreement). Default by a seller, if the Fund is
delayed or prevented from exercising its rights to dispose of the collateral
securities, could expose the Fund to possible loss, including the risk of a
possible decline in the value of the underlying securities during the period
while the Fund seeks to assert its rights thereto. Repurchase agreements are
considered to be loans by the Fund under the 1940 Act. The seller under a
repurchase agreement will be required to maintain the value of the securities
subject to the agreement at not less than the repurchase price (including
accrued interest). Securities subject to repurchase agreements will be held by
the Fund's custodian or in the Federal Reserve/Treasury book-entry system or
another authorized securities depository.

Reverse Repurchase Agreements and Borrowings. A Fund may borrow funds
for temporary purposes and not for leverage by agreeing to sell portfolio
securities to financial

- - 6 -
<PAGE> 46

institutions such as banks and broker-dealers and to repurchase them at a
mutually agreed-upon date and price. At the time the Fund enters into such an
arrangement (a "reverse repurchase agreement"), it will place in a segregated
custodial account cash or liquid securities having a value equal to the
repurchase price (including accrued interest) and will subsequently monitor the
account to ensure that such equivalent value is maintained. Reverse repurchase
agreements involve the risk that the market value of the securities sold by the
Fund may decline below the repurchase price of those securities. Reverse
repurchase agreements are considered to be borrowings by the Fund under the
1940 Act.

Stand-By Commitment Agreements. (New York Tax Exempt Fund only). The
Fund may acquire "stand-by commitments" with respect to Municipal Securities
held in its portfolio. Under a stand-by commitment, a dealer agrees to purchase
at the Fund's option specified Municipal Securities at a specified price.
Stand-by commitments acquired by the Fund may also be referred to as "put"
options. The Fund's right to exercise stand-by commitments is unconditional and
unqualified. A stand-by commitment is not transferable by the Fund, although
the Fund can sell the underlying securities to a third party at any time.

The principal risk of a stand-by commitment is that the writer of a
commitment may default on its obligation to repurchase the securities acquired
with it. The Fund intends to enter into stand-by commitments only with brokers,
dealers and banks that, in the opinion of Credit Suisse Asset Management, LLC,
each Fund's investment adviser ("CSAM"), present minimal credit risks. In
evaluating the creditworthiness of the issuer of a stand-by commitment, CSAM
will periodically review relevant financial information concerning the issuer's
assets, liabilities and contingent claims.

The amount payable to the Fund upon its exercise of a stand-by
commitment is normally (i) the Fund's acquisition cost of the Municipal
Securities (excluding any accrued interest which the Fund paid on their
acquisition), less any amortized market premium or plus any amortized market or
original issue discount during the period the Fund owned the securities, plus
(ii) all interest accrued on the securities since the last interest payment
date during that period.

The Fund expects that stand-by commitments will generally be available
without the payment of any direct or indirect consideration. However, if
necessary or advisable, the Fund may pay for a stand-by commitment either
separately in cash or by paying a higher price for portfolio securities which
are acquired subject to the commitment (thus reducing the yield to maturity
otherwise available for the same securities). The total amount paid in either
manner for outstanding stand-by commitments held in the Fund's portfolio will
not exceed 1/2 of 1% of the value of the Fund's total assets calculated
immediately after each stand-by commitment is acquired.

The Fund would acquire stand-by commitments solely to facilitate
portfolio liquidity and does not intend to exercise its rights thereunder for
trading purposes. The acquisition of a stand-by commitment would not affect the
valuation or assumed maturity of the underlying Municipal Securities which, as
noted, would continue to be valued in accordance with the amortized cost
method. Stand-by commitments acquired by the Fund would be valued at zero in
determining net asset value. Where the Fund paid any consideration directly or
indirectly

- - 7 -
<PAGE> 47

for a stand-by commitment, its cost would be reflected as unrealized
depreciation for the period during which the commitment was held by the Fund.
Stand-by commitments would not affect the average weighted maturity of the
Fund's portfolio.

The Internal Revenue Service has issued a revenue ruling to the effect
that a registered investment company will be treated for federal income tax
purposes as the owner of the Municipal Securities acquired subject to a
stand-by commitment and the interest on the Municipal Securities will be
tax-exempt to the Fund.

Third Party Puts. (New York Tax Exempt Fund only). The Fund may purchase
long-term fixed rate bonds that have been coupled with an option granted by a
third party financial institution allowing the Fund at specified intervals to
tender (or "put") the bonds to the institution and receive the face value
thereof (plus accrued interest). These third party puts are available in
several different forms, may be represented by custodial receipts or trust
certificates and may be combined with other features such as interest rate
swaps. The Fund receives a short-term rate of interest (which is periodically
reset), and the interest rate differential between that rate and the fixed rate
on the bond is retained by the financial institution. The financial institution
granting the option does not provide credit enhancement, and in the event that
there is a default in the payment of principal or interest, or downgrading of a
bond to below investment grade, or a loss of the bond's tax-exempt status, the
put option will terminate automatically, the risk to the Fund will be that of
holding such a long-term bond and the dollar-weighted average maturity of the
Fund's portfolio would be adversely affected.

These bonds coupled with puts may present the same tax issues as are
associated with stand-by commitments. As with any stand-by commitment, the Fund
intends to take the position that it is the owner of any municipal obligation
acquired subject to a third party put, and that tax-exempt interest earned with
respect to such municipal obligations will be tax-exempt in its hands. There is
no assurance that the Internal Revenue Service will agree with such position in
any particular case. Additionally, the federal income tax treatment of certain
other aspects of these investments, including the treatment of tender fees and
swap payments, in relation to various regulated investment company tax
provisions is unclear. However, CSAM, intends to manage the Fund's portfolio in
a manner designed to minimize any adverse impact from these investments.

Taxable Investments. (New York Tax Exempt Fund only). Because the Fund's
purpose is to provide income excluded from gross income for federal income tax
purposes and exempt from New York State and New York City taxes, the Fund
generally will invest in taxable obligations only if and when the investment
adviser believes it would be in the best interests of the Fund's investors to
do so. Situations in which the Fund may invest up to 20% of its total assets in
taxable securities include: (i) pending investment of proceeds of sales of Fund
shares or the sale of its portfolio securities or (ii) when the Fund requires
highly liquid securities in order to meet anticipated redemptions. The Fund may
temporarily invest more than 20% of its total assets in taxable securities to
maintain a "defensive" posture when the Fund's investment adviser determines
that it is advisable to do so because of adverse market conditions affecting
the market for Municipal Securities generally.

- - 8 -
<PAGE> 48

Among the taxable investments in which the Fund may invest are
repurchase agreements and time deposits maturing in not more than seven days.
The Fund may agree to purchase money market instruments from financial
institutions such as banks and broker-dealers subject to the seller's agreement
to repurchase them at an agreed-upon date and price ("repurchase agreements").
The seller under a repurchase agreement will be required to maintain the value
of the securities subject to the agreement at not less than the repurchase
price (including accrued interest). Securities subject to repurchase agreements
will be held by the Fund's custodian or in the Federal Reserve/Treasury
book-entry system or another authorized securities depository.

Alternative Minimum Tax Bonds. Each Fund may invest in "Alternative
Minimum Tax Bonds," which are certain bonds issued after August 7, 1986 to
finance certain non-governmental activities (in the case of the Tax Exempt
Fund, up to 20% of its total assets). While the income from Alternative Minimum
Tax Bonds is exempt from regular federal income tax, it is a tax preference
item for purposes of the federal individual and corporate "alternative minimum
tax." The alternative minimum tax is a special tax that applies to a limited
number of taxpayers who have certain adjustments or tax preference items.
Available returns on Alternative Minimum Tax Bonds acquired by a Fund may be
lower than those from other Municipal Obligations acquired by a Fund due to the
possibility of federal, state and local alternative minimum or minimum income
tax liability on Alternative Minimum Tax Bonds. At present, the Cash Reserve
Fund does not intend to purchase Alternative Minimum Tax Bonds.

Other Investment Policies and Practices of the New York Tax Exempt Fund.

Non-Diversified Status. The New York Tax Exempt Fund is classified as
non-diversified within the meaning of the 1940 Act, which means that it is not
limited by such Act in the proportion of its assets that it may invest in
securities of a single issuer. The Fund's investments will be limited, however,
in order to qualify as a "regulated investment company" for purposes of the
Code. See "Additional Information Concerning Taxes." To qualify, the Fund will
comply with certain requirements, including limiting its investments so that at
the close of each quarter of the taxable year (a) not more than 25% of the
market value of its total assets will be invested in the securities of a single
issuer, and (b) with respect to 50% of the market value of its total assets,
not more than 5% of the market value of its total assets will be invested in
the securities of a single issuer and the Fund will not own more than 10% of
the outstanding voting securities of a single issuer.

Special Considerations and Risk Factors. In seeking to achieve its
investment objective the Tax Exempt Fund may invest all or any part of its
assets in Municipal Securities which are industrial development bonds.
Moreover, although the Tax Exempt Fund does not currently intend to do so on a
regular basis, it may invest more than 25% of its assets in Municipal
Securities the interest on which is paid solely from revenues of economically
related projects, if such investment is deemed necessary or appropriate by the
Fund's investment adviser and sub-investment adviser. To the extent that the
Fund's assets are concentrated in Municipal Securities payable from revenues on
economically related projects and facilities, the Fund will be

- - 9 -
<PAGE> 49

subject to the peculiar risks presented by such projects to a greater extent
than it would be if the Fund's assets were not so concentrated.

The Tax Exempt Fund also invests in securities backed by guarantees from
banks and other financial institutions. The Fund's ability to maintain a stable
share price is largely dependent upon such guarantees, which are not supported
by federal deposit insurance. Consequently, changes in the credit quality of
these institutions could have an adverse impact on securities they have
guaranteed or backed, which could cause losses to the Fund and affect its share
price.

As a non-diversified mutual fund, the Tax Exempt Fund may invest a
greater proportion of its assets in the obligations of a smaller number of
issuers and, as a result, will be subject to greater credit risk with respect
to its portfolio securities. In the opinion of the Fund's adviser, any risk to
the Fund should be limited by its intention to continue to conduct its
operations so as to qualify as a "regulated investment company" for purposes of
the Internal Revenue Code of 1986, as amended (the "Code"), and by its policies
restricting investments to obligations with short-term maturities and high
quality credit ratings.

The Tax Exempt Fund's ability to achieve its investment objective is
dependent upon the ability of the issuers of New York Municipal Securities to
meet their continuing obligations for the payment of principal and interest.
New York State and New York City face long-term economic problems that could
seriously affect their ability and that of other issuers of New York Municipal
Securities to meet their financial obligations.

Certain substantial issuers of New York Municipal Securities (including
issuers whose obligations may be acquired by the Fund) have, at times,
experienced serious financial difficulties. These difficulties have jeopardized
the credit standing and impaired the borrowing abilities of all New York
issuers and have generally contributed to higher interest costs for their
borrowings and fewer markets for their outstanding debt obligations. Although
several different issues of municipal securities of New York State and its
agencies and instrumentalities and of New York City have been downgraded by S&P
and Moody's in recent years, the most recent actions of S&P and Moody's have
been to place the debt obligations of New York State on CreditWatch with
positive implications and to upgrade the debt obligations of New York City,
respectively. Strong demand for New York Municipal Securities has also at times
had the effect of permitting New York Municipal Securities to be issued with
yields relatively lower, and after issuance, to trade in the market at prices
relatively higher, than comparably rated municipal obligations issued by other
jurisdictions. A recurrence of the financial difficulties previously
experienced by certain issuers of New York Municipal Securities could result in
defaults or declines in the market values of those issuers' existing
obligations and, possibly, in the obligations of other issuers of New York
Municipal Securities. Although as of the date of this Statement of Additional
Information, no issuers of New York Municipal Securities are in default with
respect to the payment of their municipal securities, the occurrence of any
such default could affect adversely the market values and marketability of all
New York Municipal Securities and, consequently, the net asset value of the
Fund's portfolio

- - 10 -
<PAGE> 50

Other Investment Limitations.

Cash Reserve Fund. The investment limitations numbered 1 through 10 may
not be changed without the affirmative vote of the holders of a majority of the
Fund's outstanding shares. Such majority is defined as the lesser of (i) 67% or
more of the shares present at a meeting, if the holders of more than 50% of the
outstanding shares of the Fund are present or represented by proxy, or (ii)
more than 50% of the outstanding shares. Investment limitations 11 and 12 may
be changed by a vote of the Fund's Board of Directors (the "Board") at any
time.

The Cash Reserve Fund may not:

1. Invest in common stocks, preferred stocks, warrants, other equity
securities, corporate bonds or indentures, state bonds, municipal bonds or
industrial revenue bonds.

2. Purchase the securities of any issuer if as a result more than 5%
of the value of the Fund's assets would be invested in the securities of such
issuer, except that this 5% limitation does not apply to securities issued or
guaranteed by the United States government, its agencies or instrumentalities,
and except that up to 25% of the value of the Fund's assets may be invested
without regard to this 5% limitation.

3. Borrow money, issue senior securities or enter into reverse
repurchase agreements except for temporary or emergency purposes and not for
leveraging, and then in amounts not in excess of 10% of the value of the Fund's
assets at the time of such borrowing; or mortgage, pledge or hypothecate any
assets except in connection with any such borrowing and in amounts not in
excess of the lesser of the dollar amounts borrowed or 10% of the value of the
Fund's assets at the time of such borrowing. The Fund does not currently intend
to enter into reverse repurchase agreements in amounts in excess of 5% of its
assets at the time the agreement is entered into. Whenever borrowings exceed 5%
of the value of the Fund's total assets, the Fund will not make any additional
investments.

4. Purchase any securities which would cause more than 25% of the
value of the Fund's total assets at the time of purchase to be invested in the
securities of issuers conducting their principal business activities in the
same industry; provided that there shall be no limit on the purchase of
obligations issued or guaranteed by the United States, any state, territory or
possession of the United States, the District of Columbia or any of their
authorities, agencies, instrumentalities or political sub-divisions or
certificates of deposit, time deposits, savings deposits and bankers'
acceptances.

5. Make loans except that the Fund may purchase or hold debt
obligations in accordance with its investment objective, policies and
limitations and enter into repurchase agreements.

- - 11 -
<PAGE> 51

6. Underwrite any issue of securities except to the extent that the
purchase of debt obligations directly from the issuer thereof in accordance
with the Fund's investment objective, policies and limitations may be deemed to
be underwriting.

7. Purchase securities on margin, make short sales of securities or
maintain a short position.

8. Write or sell puts, calls, straddles, spreads or combinations
thereof.

9. Purchase or sell real estate, real estate investment trust
securities, commodities or commodity contracts, or invest in oil, gas or
mineral exploration or development programs, except that the Fund may purchase
commercial paper issued by companies that invest in real estate or interests
therein.

10. Purchase securities of other investment companies except in
connection with a merger, consolidation, acquisition or reorganization.

11. Invest more than 10% of the value of the Fund's total assets in
securities which may be illiquid because of legal or contractual restrictions
on resale or securities for which there are no readily available market
quotations. For purposes of this limitation, repurchase agreements with
maturities greater than seven days after notice by the Fund, variable rate
master demand notes providing for settlement upon maturities longer than seven
days and savings accounts which require more than seven days' notice prior to
withdrawal shall be considered illiquid securities.

12. Invest in oil, gas or mineral leases.

If a percentage restriction (other than the percentage limitation set
forth in No. 3 above) is adhered to at the time of an investment, a later
increase or decrease in the percentage of assets resulting from a change in the
values of portfolio securities or in the amount of the Fund's assets will not
constitute a violation of such restriction.

New York Tax Exempt Fund. The investment limitations numbered 1 through
9 may not be changed without the affirmative vote of the holders of a majority
of the Fund's outstanding shares. Such majority is defined as the lesser of (i)
67% or more of the shares present at a meeting, if the holders of more than 50%
of the outstanding shares of the Fund are present or represented by proxy, or
(ii) more than 50% of the outstanding shares. Investment limitations 10 and 11
may be changed by a vote of the Fund's Board of Directors (the "Board") at any
time.

The New York Tax Exempt Fund may not:

1. Invest less than 80% of its assets in securities the interest on which is
exempt from federal income tax, except during temporary defensive periods or
under unusual market conditions, as determined by the Fund's investment
adviser.

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<PAGE> 52

2. Borrow money, issue senior securities or enter into reverse repurchase
agreements except for temporary or emergency purposes, and not for
leveraging, and then in amounts not in excess of 10% of the value of the
Fund's assets at the time of such borrowing; or mortgage, pledge or
hypothecate any assets except in connection with any such borrowing and in
amounts not in excess of the lesser of the dollar amounts borrowed or 10% of
the value of the Fund's assets at the time of such borrowing. The Fund does
not currently intend to enter into reverse repurchase agreements in amounts
in excess of 5% of its assets at the time the agreement is entered into.
Whenever borrowings exceed 5% of the value of the Fund's total assets, the
Fund will not make any additional investments.

3. Purchase any securities which would cause more than 25% of the value of the
Fund's total assets at the time of purchase to be invested in the securities
of issuers conducting their principal business activities in the same
industry; provided that there shall be no limit on the purchase of (i)
obligations issued by the United States, any state, territory or possession
of the United States, the District of Columbia or any of their authorities,
agencies, instrumentalities or political sub-divisions, (ii) certificates of
deposit issued by United States branches of United States banks or (iii)
Municipal Securities the interest on which is paid solely from revenues of
economically related projects. For purposes of this restriction, private
activity securities ultimately payable by companies within the same industry
are treated as if they were issued by issuers in the same industry.

4. Make loans except that the Fund may purchase or hold debt obligations and
enter into repurchase agreements in accordance with its investment
objective, policies and limitations.

5. Underwrite any issue of securities except to the extent that the purchase of
debt obligations directly from the issuer thereof in accordance with the
Fund's investment objective, policies and limitations may be deemed to be
underwriting.

6. Purchase or sell real estate, real estate investment trust securities,
commodities or commodity contracts, or invest in oil, gas or mineral
exploration or development programs, except that the Fund may invest in debt
obligations secured by real estate, mortgages or interests therein.

7. Purchase securities on margin, make short sales of securities or maintain
short positions.

8. Write or sell puts, calls, straddles, spreads or combinations thereof,
except that the Fund may acquire stand-by commitments.

9. Purchase securities of other investment companies except in connection with
a merger, consolidation, acquisition or reorganization.

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<PAGE> 53

10. Invest in oil, gas or mineral leases.

If a percentage restriction (other than the percentage limitation set
forth in No. 2 above) is adhered to at the time of an investment, a later
increase or decrease in the percentage of assets resulting from a change in the
values of portfolio securities or in the amount of the Fund's assets will not
constitute a violation of such restriction.

PORTFOLIO VALUATION

Each Fund's portfolio securities are valued on the basis of amortized
cost. Under this method, the Fund values a portfolio security at cost on the
date of purchase and thereafter assumes a constant value of the security for
purposes of determining net asset value, which normally does not change in
response to fluctuating interest rates. Although the amortized cost method
seems to provide certainty in portfolio valuation, it may result in periods
during which values, as determined by amortized cost, are higher or lower than
the amount the Fund would receive if it sold the securities. In connection with
amortized cost valuation, the Board has established procedures that are
intended to stabilize the Fund's net asset value per share for purposes of
sales and redemptions at $1.00. These procedures include review by the Board,
at such intervals as it deems appropriate, to determine the extent, if any, to
which the Fund's net asset value per share calculated by using available market
quotations deviates from $1.00 per share. In the event such deviation exceeds
1/2 of 1%, the Board will promptly consider what action, if any, should be
initiated. If the Board believes that the amount of any deviations from the
Fund's $1.00 amortized cost price per share may result in material dilution or
other unfair results to investors or existing shareholders, it will take such
steps as it considers appropriate to eliminate or reduce to the extent
reasonably practicable any such dilution or unfair results. These steps may
include selling portfolio instruments prior to maturity; shortening the Fund's
average portfolio maturity; withholding or reducing dividends; redeeming shares
in kind; reducing the number of the Fund's outstanding shares without monetary
consideration; or utilizing a net asset value per share determined by using
available market quotations.

PORTFOLIO TRANSACTIONS

CSAM is responsible for establishing, reviewing, and, where necessary,
modifying a Fund's investment program to achieve its investment objective.
BlackRock Institutional Management Corporation ("BIMC") generally will select
specific portfolio investments and effect transactions for each Fund. Purchases
and sales of portfolio securities are usually principal transactions without
brokerage commissions effected directly with the issuer or with dealers who
specialize in money market instruments. BIMC seeks to obtain the best net price
and the most favorable execution of orders. To the extent that the execution
and price offered by more than one dealer are comparable, BIMC may, in its
discretion, effect transactions in portfolio securities with dealers who
provide the Fund with research advice or other services.

Investment decisions for a Fund concerning specific portfolio securities
are made independently from those for other clients advised by BIMC. Such other
investment clients may invest in the same securities as the Fund. When
purchases or sales of the same security are made at substantially the same time
on behalf of such other clients, transactions are averaged as to price, and
available investments allocated as to amount, in a manner which BIMC believes
to be

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<PAGE> 54

equitable to each client, including the Fund. In some instances, this
investment procedure may adversely affect the price paid or received by the
Fund or the size of the position obtained or sold for the Fund. To the extent
permitted by law, BIMC may aggregate the securities to be sold or purchased for
each Fund with those to be sold or purchased for such other investment clients
in order to obtain best execution.

In no instance will portfolio securities be purchased from or sold to
CSAM, Credit Suisse Asset Management Securities, Inc. ("CSAMSI") or Credit
Suisse First Boston ("CS First Boston") or any affiliated person of such
companies, except pursuant to an exemption received from the SEC. In addition,
a Fund will not give preference to any institutions with whom the Fund enters
into distribution or shareholder servicing agreements concerning the provision
of distribution services or support services.

The New York Tax Exempt Fund may participate, if and when practicable,
in bidding for the purchase of Municipal Securities directly from an issuer for
the Fund's portfolio in order to take advantage of the lower purchase price
available to members of such a group. The Fund will engage in this practice,
however, only when CSAM and BIMC, in their sole discretion, believe such
practice to be otherwise in the Fund's interest.

Each Fund does not intend to seek profits through short-term trading. A
Fund's annual portfolio turnover will be relatively high but the Fund's
portfolio turnover is not expected to have a material effect on its net income.
The Fund's portfolio turnover is expected to be zero for regulatory reporting
purposes.

SPECIAL CONSIDERATIONS RELATING TO NEW YORK

MUNICIPAL SECURITIES

Some of the significant financial considerations relating to the New
York Tax Exempt Fund's investments in New York Municipal Securities are
summarized below. This summary information is not intended to be a complete
description and is principally derived from the Annual Information Statement of
the State of New York as supplemented and contained in official statements
relating to issues of New York Municipal Securities that were available prior
to the date of this Statement of Additional Information. The accuracy and
completeness of the information contained in those official statements have not
been independently verified.

State Economy. New York is one of the most populous states in the nation
and has a relatively high level of personal wealth. The State's economy is
diverse with a comparatively large share of the nation's finance, insurance,
transportation, communications and services employment, and a very small share
of the nation's farming and mining activity. The State's location and its
excellent air transport facilities and natural harbors have made it an
important link in international commerce. Travel and tourism constitute an
important part of the economy. Like the rest of the nation, New York has a
declining proportion of its workforce engaged in manufacturing, and an
increasing proportion engaged in service industries.

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<PAGE> 55

State per capita personal income has historically been significantly
higher than the national average, although the ratio has varied substantially.
Because New York City (the "City") is a regional employment center for a
multi-state region, State personal income measured on a residence basis
understates the relative importance of the State to the national economy and
the size of the base to which State taxation applies.

The economic forecast of the State has also been modified for 2000 and
2001 from the mid-year forecast to reflect a stronger-than-expected economy.
Continued growth is projected for 2000 and 2001 for employment, wages, and
personal income, although the growth in employment will moderate from the 1999
pace. Personal income is estimated to have grown by 4.7 percent in 1999, fueled
in part by a large increase in financial sector bonus payments at the year's
end. Personal income is projected to grow 5.5 percent in 2000 and 4.8 percent
in 2001. Total bonus payments are projected to increase by 11 percent in 2000
and 10.5 percent in 2001. Overall employment growth is expected to continue at
a more modest pace than in 1999, reflecting the slower growth in the national
economy, continued spending restraint by government employers, and
restructuring in the manufacturing, health care, social service, and banking
sectors.

There can be no assurance that the State economy will not experience
worse-than-predicted results, with corresponding material and adverse effects
on the State's projections of receipts and disbursements.

State Budget. The State Constitution requires the governor (the
"Governor") to submit to the State legislature (the "Legislature") a balanced
executive budget which contains a complete plan of expenditures for the ensuing
fiscal year and all moneys and revenues estimated to be available therefor,
accompanied by bills containing all proposed appropriations or reappropriations
and any new or modified revenue measures to be enacted in connection with the
executive budget. The entire plan constitutes the proposed State financial plan
for that fiscal year. The Governor is required to submit to the Legislature
quarterly budget updates which include a revised cash-basis state financial
plan, and an explanation of any changes from the previous state financial plan.

State law requires the Governor to propose a balanced budget each year.
In recent years, the State has closed projected budget gaps of $5.0 billion
(1995-96), $3.9 billion (1996-97), $2.3 billion (1997-98), and less than $1
billion (1998-99). On March 31, 1999, the State adopted the debt service
portion of the State budget for the 1999-2000 fiscal

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<PAGE> 56

year; four months later, on August 4, 1999, it enacted the remainder of the
budget. The Governor approved the budget as passed by the Legislature. Prior to
passing the budget in its entirety for the current fiscal year, the State
enacted appropriations that permitted the State to continue its operations.

The State revised the cash-basis 1999-2000 State Financial Plan on
January 11, 2000, with the release of the 2000-01 Executive Budget. The State
updated the Financial Plan on January 31, 2000 to reflect the Governor's
amendments to his Executive Budget. After these changes, the Division of the
Budget ("DOB") now expects the State to close the 1999-2000 fiscal year with an
available cash surplus of $758 million in the General Fund, an increase of $733
million over the surplus estimate in the mid-year update. The larger projected
surplus derives from $499 million in net higher projected receipts and $259
million in net lower estimated disbursements. DOB revised both its projected
receipts and disbursements based on a review of actual operating results
through December 1999, as well as an analysis of underlying economic and
programmatic trends it believes may affect the Financial Plan for the balance
of the year.

The State plans to use the entire $758 million surplus to make
additional deposits to reserve funds. At the close of the current fiscal year,
the State expects to deposit $75 million from the surplus into the State's Tax
Stabilization Reserve Fund ("TSRF") - the fifth consecutive annual deposit. In
the 2000-01 Executive Budget, as amended, the Governor is proposing to use the
remaining $683 million from the 1999-2000 surplus to fully finance the
estimated 2001-02 and 2002-03 costs of his proposed tax reduction package ($433
million) and to increase the Debt Reduction Reserve Fund ("DRRF") ($250
million).

DOB projects total General Fund disbursements of $37.06 billion in
1999-2000, a decline of $282 million from the October estimate. Of this amount,
$33 million is related to the timing of spending and accounting adjustments and
therefore does not contribute to the surplus projected by DOB. The $33 million
consists of lower timing-related spending of $65 million from the Community
Projects Fund ("CPF") and $50 million from the Collective Bargaining Reserve,
offset by the Medicaid reclassification of $82 million described above.
Accordingly, lower disbursements since October contribute $249 million to the
1999-2000 surplus, which, when combined with the $10 million in lower
disbursements recognized in the mid-year update, produce a total reduction in
estimated disbursements of $259 million for the current year.

State Operations spending is now projected to total $6.63 billion in
1999-2000. In the revised Financial Plan, $50 million of an original $100
million for new collective bargaining costs is set aside in a reserve to cover
the cost of labor agreements in 1999-2000, and the balance is transferred to
General State Charges in the current year to pay for the recently approved
labor contract with State University employees and other labor costs. The
remaining revisions to the State Operations estimate are comprised of savings
from agency efficiencies and timing-related changes that do not affect the
surplus.

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<PAGE> 57

The State projects a closing balance of $1.17 billion in the General
Fund, after the tax refund reserve transaction. The balance is comprised of
$548 million in the Tax Stabilization Reserve Fund ("TSRF") after a $75 million
deposit in 1999-2000; $265 million in the CPF, which pays for Legislative
initiatives; $250 million in the DRRF; and $107 million in the Contingency
Reserve Fund ("CRF") (which guards against litigation risks).

In addition to the General Fund closing balance of $1.17 billion, the
State will have a projected $3.09 billion in the tax refund reserve account at
the end of 1999-2000. The refund reserve account is used to adjust personal
income tax collections across fiscal years to pay for tax refunds, as well as
to accomplish other Financial Plan objectives. The projected balance of $3.09
billion is comprised of $1.82 billion in tax reduction reserves from the
1998-99 surplus; $683 million from the 1999-2000 surplus; $521 million from
LGAC that may be used to pay tax refunds during 2000-01 but must be on deposit
at the close of the fiscal year; $50 million in collective bargaining reserves
from 1999-2000; and $25 million in reserves for tax credits.

The General Fund is the principal operating fund of the State and is
used to account for all financial transactions except those required to be
accounted for in another fund. It is the State's largest fund and received
almost all State taxes and other resources not dedicated to particular
purposes. General Fund moneys are also transferred to other funds, primarily to
support certain capital projects and debt service payments in other fund types.

The Governor presented his 2000-01 Executive Budget to the Legislature
on January 10, 2000. The Executive Budget contains financial projections for
the State's 1999-2000 through 2002-03 fiscal years, a detailed explanation of
receipts estimates and the economic forecast on which it is based, and proposed
Capital Program and Financing Plan for the 2000-01 through 2004-05 fiscal
years. On January 31, 2000, the Governor submitted amendments to his Executive
Budget, the most significant of which recommends eliminating all gross receipts
taxes on energy providers.

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<PAGE> 58

There can be no assurance that the Legislature will enact into law the
Governor's Executive Budget, as amended, or that the State's adopted budget
projections will not differ materially and adversely from the projections set
forth therein.

The 2000-01 Financial Plan is projected to have receipts in excess of
disbursements on a cash basis in the General Fund, after accounting for the
transfer of available receipts from 1999-2000 to 2000-01. Under the Governor's
Executive Budget, as amended, total General Fund receipts, including transfers
from other funds, are projected at $38.62 billion, an increase of $1.28 billion
(3.4 percent) over the current fiscal year. General Fund disbursements,
including transfers to other funds, are recommended to grow by 2.3 percent to
$37.93 billion, an increase of $869 million over 1999-2000. State Funds
spending (the portion of the budget supported exclusively by State taxes, fees,
and revenues) is projected to total $52.46 billion, an increase of $2.57
billion or 5.1 percent. Spending from All Government Funds is expected to grow
by 5.5 percent, increasing by $4.0 billion to $76.82 billion.

The State projects a closing balance of $1.61 billion in the General
Fund at the end of 2000-01. This balance is comprised of a $433 million reserve
set aside from the 1999-2000 surplus to finance the estimated costs of the
Governor's proposed tax reduction package in 2001-02 and 2002-03, $475 million
in cumulative reserves for collective bargaining ($425 million from 2000-01
plus $50 million from 1999-2000), $548 million in the TSRF, and $150 million in
the CRF after a proposed $43 million deposit in 2000-01. The change in the
closing

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<PAGE> 59

fund balance compared to 1999-2000 results from the planned use in 2000-01 of
$265 million for existing legislative initiatives financed from the CPF and the
reclassification of DRRF into the CPF, offset by increased reserves for
collective bargaining, tax reduction, and litigation discussed above.

In addition to the General Fund closing balance of $1.61 billion, the
State will have a projected $567 million in the tax refund reserve at the end
of 2000-01. Also, $1.2 billion is proposed to be on deposit in the Star Special
Revenue Fund to be used in 2001-02 for State-funded local tax reductions and
$250 million is proposed to be on deposit in the DRRF. The balance in the DRRF
is projected to be used in 2001-02 to retire existing high-cost State-supported
debt and increase pay-as-you-go financing of capital projects.

Many complex political, social and economic forces influence the State's
economy and finances, which may in turn affect the State's Financial Plan.
These forces may affect the State unpredictably from fiscal year to fiscal year
and are influenced by governments, institutions, and organizations that are not
subject to the State's control. The State Financial Plan is also necessarily
based upon forecasts of national and State economic activity. Economic
forecasts have frequently failed to predict accurately the timing and magnitude
of changes in the national and the State economies. The DOB believes that its
projections of receipts and disbursements relating to the current State
Financial Plan, and the assumptions on which they are based, are reasonable.
The projections assume no changes in federal tax law, which could substantially
alter the current receipts forecast. In addition, these projections do not
include funding for new collective bargaining agreements after the current
contracts expire. Actual results, however, could differ materially and
adversely from their projections, and those projections may be changed
materially and adversely from time to time.

Debt Limits and Outstanding Debt. There are a number of methods by which
the State of New York may incur debt. Under the State Constitution, the State
may not, with limited exceptions for emergencies, undertake long-term general
obligation borrowing (i.e., borrowing for more than one year) unless the
borrowing is authorized in a specific amount for a single work or purpose by
the Legislature and approved by the voters. There is no limitation on the
amount of long-term general obligation debt that may be so authorized and
subsequently incurred by the State.

The State may undertake short-term borrowings without voter approval (i)
in anticipation of the receipt of taxes and revenues, by issuing tax and
revenue anticipation notes, and (ii) in anticipation of the receipt of proceeds
from the sale of duly authorized but unissued general obligation bonds, by
issuing bond anticipation notes. The State may also, pursuant to specific
constitutional authorization, directly guarantee certain obligations of the
State of New York's authorities and public benefit corporations
("Authorities"). Payments of debt service on New York State general obligation
and New York State-guaranteed bonds and notes are legally enforceable
obligations of the State of New York.

The State employs additional long-term financing mechanisms,
lease-purchase and contractual-obligation financings, which involve obligations
of public authorities or municipalities that are State-supported but are not
general obligations of the State. Under these financing arrangements, certain
public authorities and municipalities have issued obligations to

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<PAGE> 60

finance the construction and rehabilitation of facilities or the acquisition
and rehabilitation of equipment, and expect to meet their debt service
requirements through the receipt of rental or other contractual payments made
by the State. Although these financing arrangements involve a contractual
agreement by the State to make payments to a public authority, municipality or
other entity, the State's obligation to make such payments is generally
expressly made subject to appropriation by the Legislature and the actual
availability of money to the State for making the payments. The State has also
entered into a contractual-obligation financing arrangement with the LGAC to
restructure the way the State makes certain local aid payments.

Sustained growth in the State's economy could contribute to closing
projected budget gaps over the next several years, both in terms of
higher-than-projected tax receipts and in lower-than-expected entitlement
spending. The State assumes that the 2000-01 Financial Plan will achieve $500
million in savings from initiatives by State agencies to deliver services more
efficiently, workforce management efforts, maximization of federal and
non-General Fund spending offsets, and other actions necessary to help bring
projected disbursements and receipts into balance. The projections do not
assume any gap-closing benefit from the potential settlement of State claims
against the tobacco industry.

On January 13, 1992, S&P reduced its ratings on the State's general
obligation bonds from A to A- and, in addition, reduced its ratings on the
State's moral obligation, lease purchase, guaranteed and contractual obligation
debt. On August 28, 1997, S&P revised its ratings on the State's general
obligation bonds from A- to A and revised its ratings on the State's

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<PAGE> 61

moral obligation, lease purchase, guaranteed and contractual obligation debt.
On March 5, 1999, S&P affirmed I rating on the State's outstanding bonds.
Subsequent to that time, the State's general obligations have not been
downgraded by S&P.

On January 6, 1992, Moody's reduced its ratings on outstanding
limited-liability State lease purchase and contractual obligations from A to
Baa1. On February 28, 1994, Moody's reconfirmed I rating on the State's general
obligation long-term indebtedness. On March 20, 1998, Moody's assigned the
highest commercial paper rating of P-1 to the short-term notes of the State. On
March 5, 1999, Moody's affirmed I2 rating with a stable outlook to the State's
general obligations.

New York State has never defaulted on any of its general obligation
indebtedness or its obligations under lease-purchase or contractual-obligation
financing arrangements and has never been called upon to make any direct
payments pursuant to its guarantees.

Litigation. Certain litigation pending against New York State or its
officers or employees could have a substantial or long-term adverse effect on
New York State finances. Among the more significant of these cases are those
that involve (1) the validity of agreements and treaties by which various
Indian tribes transferred title to New York State of certain land in central
and upstate New York; (2) certain aspects of New York State's Medicaid
policies, including its rates, regulations and procedures; (3) action seeking
enforcement of certain sales and excise taxes and tobacco products and motor
fuel sold to non-Indian consumers on Indian reservations; and (4) a challenge
to the Governor's application of his constitutional line item veto authority.

Several actions challenging the constitutionality of legislation enacted
during the 1990 legislative session which changed actuarial funding methods for
determining state and local contributions to state employee retirement systems
have been decided against the State. As a result, the Comptroller developed a
plan to restore the State's retirement systems to prior funding levels. Such
funding is expected to exceed prior levels by $116 million in fiscal 1996-97,
$193 million in fiscal 1997-98, peaking at $241 million in fiscal 1998-99.
Beginning in fiscal 2001-02, State contributions required under the
Comptroller's plan are projected to be less than that required under the prior
funding method. As a result of the United States Supreme Court decision in the
case of State of Delaware v. State of New York, on January 21, 1994, the State
entered into a settlement agreement with various parties. Pursuant to all
agreements executed in connection with the action, the State was required to
make aggregate payments of $351.4 million. Annual payments to the various
parties will continue through the State's 2002-03 fiscal year in amounts which
will not exceed $48.4 million in any fiscal year subsequent to the State's
1994-95 fiscal year. Litigation challenging the constitutionality of the
treatment of certain moneys held in a reserve fund was settled in June 1996 and
certain amounts in a Supplemental Reserve Fund

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<PAGE> 62

previously credited by the State against prior State and local pension
contributions were paid in 1998.

The legal proceedings noted above involve State finances, State programs
and miscellaneous cure rights, tort, real property and contract claims in which
the State is a defendant and the monetary damages sought are substantial,
generally in excess of $100 million. These proceedings could affect adversely
the financial condition of the State in the current fiscal year or thereafter.
Adverse developments in these proceedings, other proceedings for which there
are unanticipated, unfavorable and material judgments, or the initiation of new
proceedings could affect the ability of the State to maintain a balanced
financial plan. An adverse decision in any of these proceedings could exceed
the amount of the reserve established in the State's financial plan for the
payment of judgments and, therefore, could affect the ability of the State to
maintain a balanced financial plan.

Although other litigation is pending against New York State, except as
described herein, no current litigation involves New York State's authority, as
a matter of law, to contract indebtedness, issue its obligations, or pay such
indebtedness when it matures, or affects New York State's power or ability, as
a matter of law, to impose or collect significant amounts of taxes and
revenues.

On November 23, 1998, the attorneys general for forty-six states
(including New York) entered into a master settlement agreement ("MSA") with
the nation's largest tobacco manufacturers. Under the terms of the MSA, the
states agreed to release the manufacturers from all smoking-related claims in
exchange for specified payments and the imposition of restrictions on tobacco
advertising and marketing. New York is projected to receive $25 billion over 25
years under the MSA, with payments apportioned among the State (51 percent),
counties (22 percent), and New York City (27 percent). The projected payments
are an estimate and subject to adjustments for, among other things, the annual
change in the volume of cigarette shipments and the rate of inflation.

From 1999-2000 through 2002-03, the State expects to receive $1.54
billion under the nationwide settlement with cigarette manufacturers. Counties,
including New York City, will receive settlement payments of $1.47 billion over
the same period.

Authorities. The fiscal stability of New York State is related, in part,
to the fiscal stability of its Authorities, which generally have responsibility
for financing, constructing and operating revenue-producing public benefit
facilities. Authorities are not subject to the constitutional restrictions on
the incurrence of debt which apply to the State itself, and may issue bonds and
notes within the amounts of, and as otherwise restricted by, their legislative
authorization. The State's access to the public credit markets could be
impaired, and the market price of its outstanding debt may be materially and
adversely affected, if any of the Authorities were to default on their
respective obligations, particularly with respect to debt that is
State-supported or State-related.

Authorities are generally supported by revenues generated by the
projects financed or operated, such as fares, user fees on bridges, highway
tolls and rentals for dormitory rooms and housing. In recent years, however,
New York State has provided financial assistance through

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<PAGE> 63

appropriations, in some cases of a recurring nature, to certain of the
Authorities for operating and other expenses and, in fulfillment of its
commitments on moral obligation indebtedness or otherwise, for debt service.
This operating assistance is expected to continue to be required in future
years. In addition, certain statutory arrangements provide for State local
assistance payments otherwise payable to localities to be made under certain
circumstances to certain Authorities. The State has no obligation to provide
additional assistance to localities whose local assistance payments have been
paid to Authorities under these arrangements. However, in the event that such
local assistance payments are so diverted, the affected localities could seek
additional State funds.

In February 1997, the Job Development Authority ("JDA") issued
approximately $85 million of State-guaranteed bonds to refinance certain of its
outstanding bonds and notes in order to restructure and improve JDA's capital
structure. Due to concerns regarding the economic viability of its programs,
JDA's loan and loan guarantee activities were suspended since 1995. As a result
of the structural imbalances in JDA's capital structure, and defaults in its
loan portfolio and loan guarantee program incurred between 1991 and 1996, JDA
would have experienced a debt service cash flow shortfall had it not completed
its recent refinancing. JDA anticipates that it will transact additional
refinancings in 1999, 2000 and 2003 to complete its long-term plan of finance
and further alleviate cash flow imbalances which are likely to occur in future
years. JDA recently resumed its lending activities under a revised set of
lending programs and underwriting guidelines.

New York City and Other Localities. The fiscal health of the State may
also be impacted by the fiscal health of its localities, particularly the City,
which has required and continues to require significant financial assistance
from the State. The City depends on State aid both to enable the City to
balance its budget and to meet its cash requirements. There can be no assurance
that there will not be reductions in State aid to the City from amounts
currently projected or that State budgets will be adopted by the April 1
statutory deadline or that any such reductions or delays will not have adverse
effects on the City's cash flow or expenditures. In addition, the Federal
budget negotiation process could result in a reduction in or a delay in the
receipt of Federal grants which could have additional adverse effects on the
City's cash flow or revenues.

In 1975, New York City suffered a fiscal crisis that impaired the
borrowing ability of both the City and New York State. In that year the City
lost access to the public credit markets. The City was not able to sell
short-term notes to the public again until 1979. In 1975, S&P suspended I
rating of City bonds. This suspension remained in effect until March 1981, at
which time the City received an investment grade rating of BBB from S&P.

On July 2, 1985, S&P revised its rating of City bonds upward to BBB+ and
on November 19, 1987, to A-. On February 3, 1998 and again on May 27, 1998, S&P
assigned a BBB+ rating to the City's general obligation debt and placed the
ratings on CreditWatch with positive implications. On March 9, 1999, S&P
assigned I- rating to Series 1999H of New York City general obligation bonds
and affirmed the A- rating on various previously issued New

- - 24 -
<PAGE> 64

York City bonds. Subsequent to that time, the City's general obligation bonds
have not been downgraded by S&P.

Moody's ratings of City bonds were revised in November 1981 from B (in
effect since 1977) to Ba1, in November 1983 to Baa, in December 1985 to Baa1,
in May 1988 to A and again in February 1991 to Baa1. On February 25, 1998,
Moody's upgraded approximately $28 billion of the City's general obligations
from Baa1 to A3. On June 9, 1998, Moody's affirmed I3 rating to the City's
general obligations and stated that its outlook was stable.

On March 8, 1999, Fitch IBCA upgraded New York City's $26 billion
outstanding general obligation bonds from A- to A. Subsequent to that time, the
City's general obligation bonds have not been downgraded by Fitch IBCA.

New York City is heavily dependent on New York State and federal
assistance to cover insufficiencies in its revenues. There can be no assurance
that in the future federal and State assistance will enable the City to make up
its budget deficits. To help alleviate the City's financial difficulties, the
Legislature created the Municipal Assistance Corporation ("MAC") in 1975. Since
its creation, MAC has provided, among other things, financing assistance to the
City by refunding maturing City short-term debt and transferring to the City
funds received from sales of MAC bonds and notes. MAC is authorized to issue
bonds and notes payable from certain stock transfer tax revenues, from the
City's portion of the State sales tax derived in the City and, subject to
certain prior claims, from State per capita aid otherwise payable by the State
to the City. Failure by the State to continue the imposition of such taxes, the
reduction of the rate of such taxes to rates less than those in effect on July
2, 1975, failure by the State to pay such aid revenues and the reduction of
such aid revenues below a specified level are included among the events of
default in the resolutions authorizing MAC's long-term debt. The occurrence of
an event of default may result in the acceleration of the maturity of all or a
portion of MAC's debt. MAC bonds and notes constitute general obligations of
MAC and do not constitute an enforceable obligation or debt of either the State
or the City.

Since 1975, the City's financial condition has been subject to oversight
and review by the New York State Financial Control Board (the "Control Board")
and since 1978 the City's financial statements have been audited by independent
accounting firms. To be eligible for guarantees and assistance, the City is
required during a "control period" to submit annually for Control Board
approval, and when a control period is not in effect for Control Board review,
a financial plan for the next four fiscal years covering the City and certain
agencies showing balanced budgets determined in accordance with GAAP. New York
State also established the Office of the State Deputy Comptroller for New York
City ("OSDC") to assist the Control Board in exercising its powers and
responsibilities. On June 30, 1986, the City satisfied the statutory
requirements for termination of the control period. This means that the Control
Board's powers of approval are suspended, but the Board continues to have
oversight responsibilities.

- - 25 -
<PAGE> 65

Although the City has consistently maintained balanced budgets and is
projected to achieve balanced operating results for the current fiscal year,
there can be no assurance that the gap-closing actions proposed in its
Financial Plan can be successfully implemented or that the City will maintain a
balanced budget in future years without additional State aid, revenue increases
or expenditure reductions. Additional tax increases and reductions in essential
City services could adversely affect the City's economic base.

The projections set forth in the City's Financial Plan were based on
various assumptions and contingencies which are uncertain and which may not
materialize. Changes in major assumptions could significantly affect the City's
ability to balance its budget as required by State law and to meet its annual
cash flow and financing requirements. Such assumptions and contingencies
include the condition of the regional and local economies, the impact on real
estate tax revenues of the real estate market, wage increases for City
employees consistent with those assumed in the Financial Plan, employment
growth, the ability to implement proposed reductions in City personnel and
other cost reduction initiatives, the ability of the Health and Hospitals
Corporation and the BOE to take actions to offset reduced revenues, the ability
to complete revenue generating transactions, provision of State and Federal

- - 26 -
<PAGE> 66

aid and mandate relief and the impact on City revenues and expenditures of
Federal and State welfare reform and any future legislation affecting Medicare
or other entitlements.

To successfully implement its Financial Plan, the City and certain
entities issuing debt for the benefit of the City must market their securities
successfully. The City issues securities to finance the rehabilitation of its
infrastructure and other capital needs and to refinance existing debt, as well
as for seasonal financing needs. In fiscal year 1998 and again in fiscal year
2000, the State constitutional debt limit would have prevented the City from
entering into new capital contracts. To prevent these disruptions in the
capital program, two entities were created to issue debt to increase the City's
capital financing capacity: (i) the State Legislature created the Transitional
Finance Authority ("TFA") in 1997, and (ii) the City created the Tobacco
Settlement Asset Securitization Corporation in 1999. Despite these actions, the
City, in order to continue its capital program, will need additional financing
capacity in fiscal year 2002, which could be provided through increasing the
borrowing authority of the TFA or amending the State constitutional debt limit.

The City Comptroller and other agencies and public officials have issued
reports and made public statements which, among other things, state that
projected revenues and expenditures may be different from those forecast in the
City's financial plans. It is reasonable to expect that such reports and
statements will continue to be issued and to engender public comment.

The City since 1981 has fully satisfied its seasonal financing needs in
the public credit markets, repaying all short-term obligations within their
fiscal year of issuance.

- - 27 -
<PAGE> 67

The delay in the adoption of the State's budget in certain past fiscal years
has required the City to issue short-term notes in amounts exceeding those
expected early in such fiscal years.

Certain localities, in addition to the City, have experienced financial
problems and have requested and received additional New York State assistance
during the last several State fiscal years. The potential impact on the State
of any future requests by localities for additional assistance is not included
in the State's projections of its receipts and disbursements for the fiscal
year.

Beginning in 1990, the City of Troy experienced a series of budgetary
deficits that resulted in the establishment of a Supervisory Board for the City
of Troy in 1994. The Supervisory Board's powers were increased in 1995, when
Troy MAC was created to help Troy avoid default on certain obligations. The
legislation creating Troy MAC prohibits the city of Troy from seeking federal
bankruptcy protection while Troy MAC bonds are outstanding. Troy MAC has issued
bonds to effect a restructuring of the City of Troy's obligations.

Municipalities and school districts have engaged in substantial
short-term and long-term borrowings. State law requires the Comptroller to
review and make recommendations concerning the budgets of those local
government units other than New York City that are authorized by State law to
issue debt to finance deficits during the period that such deficit financing is
outstanding.

From time to time, federal expenditure reductions could reduce, or in
some cases eliminate, federal funding of some local programs and accordingly
might impose substantial increased expenditure requirements on affected
localities. If the State, the City or any of the Authorities were to suffer
serious financial difficulties jeopardizing their respective access to the
public credit markets, the marketability of notes and bonds issued by
localities within the State could be adversely affected. Localities also face
anticipated and potential problems resulting from certain pending litigation,
judicial decisions and long-range economic trends. Long-range

- - 28 -
<PAGE> 68

potential problems of declining urban population, increasing expenditures and
other economic trends could adversely affect localities and require increasing
the State assistance in the future.

Year 2000 Compliance. To date, the State has experienced no significant
Year 2000 computer disruptions. Monitoring will continue over the next few
months to identify and correct any problems that may arise. However, there can
be no assurance that outside parties who provide goods and services to the
State will not experience computer problems related to Year 2000 programming in
the future, or that such disruptions, if they occur, will not have an adverse
impact on State operations or finances.

- - 29 -
<PAGE> 69

MANAGEMENT OF THE FUNDS

Officers and Board of Directors.

The names (and ages) of each Fund's Directors and officers, their
addresses, present positions and principal occupations during the past five
years and other affiliations are set forth below.

<TABLE>
<S> <C>
Richard H. Francis (67) Director
Currently retired; Executive Vice President and
40 Grosvenor Road Chief Financial Officer of Pan Am Corporation and
Short Hills, New Jersey 07078 Pan American World Airways, Inc. from 1988 to 1991;
Director of The Infinity Mutual Funds, BISYS Group
Incorporated;
Director/Trustee of other Warburg Pincus Funds and
other CSAM-advised investment companies.
Jack W. Fritz (72) Director
2425 North Fish Creek Road Private investor; Consultant and Director
P.O. Box 483 of Fritz Broadcasting, Inc. and Fritz
Wilson, Wyoming 83014 Communications (developers and operators of radio
stations); Director of Advo, Inc. (direct mail
advertising); Director/Trustee of other Warburg
Pincus Funds.

James S. Pasman, Jr. (69) Director
29 The Trillium Currently retired; President and Chief Operating
Pittsburgh, Pennsylvania 15238 Officer of National InterGroup, Inc. from April
1989 to March 1991; Chairman of Permian Oil Co.
from April 1989 to March 1991; Director of
Education Management Corp., Tyco International
Ltd.; Trustee, BT Insurance Funds Trust;
Director/Trustee of other Warburg Pincus Funds and
other CSAM-advised investment companies.

William W. Priest* (58) Chairman of the Board
153 East 53rd Street Chairman- Management Committee, Chief Executive
Officer and Managing Director of
</TABLE>

- -------------------------------------
* Indicates a Director/Trustee who is an "interested person" of the Fund
as defined in the 1940 Act.

- -30-
<PAGE> 70

<TABLE>
<S> <C>
New York, New York 10022 CSAM since 1990; Director/Trustee of other Warburg
Pincus Funds and other CSAM-advised investment
companies.

Steven N. Rappaport (51) Director
40 East 52nd Street, President of Loanet, Inc. (on-line accounting
New York, New York 10022 service) since 1997; Executive Vice President of
Loanet, Inc. from 1994 to 1997; Director,
President, North American Operations, and former
Executive Vice President from 1992 to 1993 of
Worldwide Operations of Metallurg Inc.; Executive
Vice President, Telerate, Inc. from 1987 to 1992;
Partner in the law firm of Hartman & Craven until
1987; Director/Trustee of other Warburg Pincus
Funds and other CSAM-advised investment companies.

Alexander B. Trowbridge (70) Director
1317 F Street, N.W., 5th Floor President of Trowbridge Partners, Inc.
Washington, DC 20004 (business consulting) since January 1990; Director
or Trustee of New England Mutual Life Insurance
Co., ICOS Corporation (biopharmaceuticals), IRI
International (energy services), The Rouse Company
(real estate development), Harris Corp.
(electronics and communications equipment), The
Gillette Co. (personal care products) and Sunoco,
Inc. (petroleum refining and marketing);
Director/Trustee of other Warburg Pincus Funds.

Eugene L. Podsiadlo (42) President
466 Lexington Avenue Managing Director of CSAM; Associated with CSAM
New York, New York 10017-3147 since Credit Suisse acquired the Funds' predecessor
adviser in July 1999; with the predecessor adviser
since 1991; Vice President of Citibank, N.A. from
1987 to 1991; Officer of CSAMSI and of other
Warburg Pincus Funds.

Hal Liebes, Esq. (35) Vice President and Secretary
153 East 53rd Street Managing Director and General Counsel of CSAM;
New York, New York 10022 Associated with Lehman Brothers, Inc. from 1996
to 1997; Associated with CSAM from 1995 to 1996;
Associated with CS First Boston Investment
Management from 1994 to 1995; Associated with
Division of Enforcement, U.S. Securities and
Exchange Commission from 1991
</TABLE>

- -31-
<PAGE> 71

<TABLE>
<S> <C>
to 1994; Officer of CSAMSI, other Warburg Pincus
Funds and other CSAM-advised investment companies.

Michael A. Pignataro (40) Treasurer and Chief Financial Officer Vice
153 East 53rd Street President and Director of Fund Administration of
New York, New York 10022 CSAM; Associated with CSAM since 1984; Officer of
other Warburg Pincus Funds and other CSAM-advised
investment companies.

Stuart J. Cohen, Esq. (31) Assistant Secretary
466 Lexington Avenue Vice President and Legal Counsel of CSAM; Associated
New York, New York 10017-3147 with CSAM since Credit Suisse acquired the Funds'
predecessor adviser in July 1999; with the
predecessor adviser since 1997; Associated with the
law firm of Gordon Altman Butowsky Weitzen Shalov &
Wein from 1995 to 1997; Officer of other Warburg
Pincus Funds.

Rocco A. DelGuercio (36) Assistant Treasurer
153 East 53rd Street Assistant Vice President and Administrative Officer
New York, New York 10022 of CSAM; Associated with CSAM since June 1996;
Assistant Treasurer, Bankers Trust Corp. -- Fund
Administration from March 1994 to June 1996; Mutual
Fund Accounting Supervisor, Dreyfus Corporation
from April 1987 to March 1994; Officer of other
Warburg Pincus Funds and other CSAM-advised
investment companies.
</TABLE>

No employee of CSAM, PFPC Inc., the Funds' co-administrator
("PFPC"), or any of their affiliates receives any compensation from the Funds
for acting as an officer or director/trustee of a Fund. Each Director who is
not a director, trustee, officer or employee of CSAM, PFPC or any of their
affiliates receives the following annual and per-meeting fees:

<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------------------------------

FEE FOR EACH AUDIT
FEE FOR EACH COMMITTEE MEETING
FUND ANNUAL FEE MEETING ATTENDED ATTENDED
- --------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Cash Reserve Fund $750 $250 $250*
- --------------------------------------------------------------------------------------------------------------------
New York Tax Exempt Fund $750 $250 $250*
- --------------------------------------------------------------------------------------------------------------------
</TABLE>

*Alexander B. Trowbridge receives $325 for serving as Chairman of the Audit
Committee.

- -32-
<PAGE> 72

Each Director is reimbursed for expenses incurred in
connection with his attendance at Board meetings.

Directors' Compensation

(for the fiscal year ended December 31, 1999)

<TABLE>
<CAPTION>
Total Compensation from
all Investment Companies
in Warburg Pincus
Fund Complex
------------
Compensation from
Name of Director(1) each Fund
----------------- ---------
<S> <C> <C>
William W. Priest(2) None None

Richard N. Cooper(3) $2,625 $47,500

Richard H. Francis(4) $1,000 $38,250

Jack W. Fritz $4,750 $94,250

Jeffrey E. Garten(3) $4,750 $94,250

Thomas A. Melfe(3) $3,125 $40,750

James S. Pasman, Jr.(4) $1,000 $38,250

Steven N. Rappaport(4) $1,000 $38,250

Arnold M. Reichman(2) None None

Alexander B. Trowbridge $4,825 $97,100
</TABLE>

- -------------------------------

1 Each Director serves as a Director or Trustee of 45 investment companies
and portfolios in the Warburg Pincus family of funds, except for Mr.
Garten, who serves as a Director or Trustee of 14 investment companies in
the Warburg Pincus family of funds.

2 Mr. Priest receives compensation as an affiliate of CSAM, and,
accordingly, receives no compensation from any Fund or any other
investment company advised by CSAM. Mr. Reichman resigned as a Director
of each Fund effective August 18, 1999.

3 Messrs. Cooper and Melfe resigned as a Director of each Fund effective
July 6, 1999. Mr. Garten resigned as a Director of the Funds effective
February 3, 2000.

4 Messrs. Francis, Pasman and Rappaport became Directors of the Funds
effective July 6, 1999.

As of April 1, 2000, Directors and officers of a Fund as a
group owned of record less than 1% of the relevant Fund's outstanding common
stock.

- -33-
<PAGE> 73

Investment Adviser, Sub-Investment Adviser and Administrator
and Co-Administrator.

CSAM, located at 153 East 53rd Street, New York, New York
10022, serves as investment adviser to each Fund pursuant to a written
agreement (the "Advisory Agreement"). CSAM is an indirect wholly-owned U.S.
subsidiary of Credit Suisse ("Credit Suisse"). Credit Suisse is a global
financial services company, providing a comprehensive range of banking and
insurance products. Active on every continent and in all major financial
centers, Credit Suisse comprises five business units -- Credit Suisse Asset
Management (asset management); Credit Suisse First Boston (investment banking);
Credit Suisse Private Banking (private banking); Credit Suisse (retail
banking); and Winterthur (insurance). Credit Suisse has approximately $680
billion of global assets under management and employs approximately 62,000
people worldwide. The principal business address of Credit Suisse is
Paradeplatz 8, CH 8070, Zurich, Switzerland.

Prior to July 6, 1999, Warburg Pincus Asset Management, Inc.
("Warburg") served as investment adviser to each Fund. On that date, Credit
Suisse acquired Warburg and combined Warburg with Credit Suisse's existing
U.S.-based asset management business ("Credit Suisse Asset Management").
Consequently, the combined entity, CSAM, became the Funds' investment adviser.
Credit Suisse Asset Management, formerly known as BEA Associates, together with
its predecessor firms, has been engaged in the investment advisory business for
over 60 years.

BIMC serves as sub-investment adviser and administrator to
the Fund and CSAMSI serves as co-administrator to the Fund pursuant to written
agreements (the "Sub-Advisory Agreement" and the "Co-Administration Agreement,"
respectively, and collectively, the "Agreements"). CSAMSI became
co-administrator to each Fund on November 1, 1999. Prior to that, Counsellors
Funds Service, Inc. ("Counsellors Service") served as co-administrator to the
Funds.

For the services provided pursuant to the Advisory Agreement,
CSAM is entitled to receive a fee, computed daily and payable monthly, at the
annual rate of .25% of the value of each Fund's average daily net assets. CSAM
and each Fund's administrators may voluntarily waive a portion of their fees
from time to time and temporarily limit the expenses to be paid by the Fund.

As sub-investment adviser and administrator, BIMC has agreed
to implement each Fund's investment program as determined by the Board and
CSAM. BIMC will supervise the day-to-day operations of the Fund and perform the
following services: (i) providing investment research and credit analysis
concerning the Fund's investments, (ii) placing orders for all purchases and
sales of the Fund's portfolio investments and (iii) maintaining the books and
records required to support the Fund's operations. BIMC also calculates the
Fund's net asset value, provides accounting services for the Funds and assists
in related aspects of the Funds ' operations. As compensation therefor, each
Fund has agreed to pay BIMC a fee computed daily

- -34-
<PAGE> 74

and payable monthly at an annual rate of .25% of the value of each Fund's
average daily net assets.

As co-administrator, CSAMSI provides shareholder liaison
services to the Funds including responding to shareholder inquiries and
providing information on shareholder investments. CSAMSI also performs a
variety of other services, including furnishing certain executive and
administrative services, acting as liaison between a Fund and its various
service providers, furnishing corporate secretarial services, which include
preparing materials for meetings of the Board, preparing proxy statements and
annual and semiannual reports, assisting in the preparation of tax returns and
monitoring and developing compliance procedures for the Fund. As compensation,
each Fund pays to CSAMSI a fee calculated at an annual rate of .10% of the
Fund's average daily net assets.

Advisory Fees paid to CSAM and CSAM's Predecessor, Warburg

<TABLE>
<CAPTION>
Fiscal year ended 10-month period ended
February 28, 1997 December 31, 1997
Net Fee Waiver Net Fee Waiver
<S> <C> <C> <C> <C>
Cash Reserve Fund $ 1,092,344 $ (229,970) $ 1,004,894 $ (192,234)
New York Tax
Exempt Fund $ 287,156 $ (74,362) $ 294,367 $ (58,818)
</TABLE>

<TABLE>
<CAPTION>
Fiscal year ended Fiscal year ended
December 31, 1998 December 31, 1999
Net Fee Waiver Net Fee Waiver
<S> <C> <C> <C> <C>
Cash Reserve Fund $ 1,059,673 $ (237,838) $ 1,051,927 $ (258,393)
New York Tax
Exempt Fund $ 307,690 $ (86,187) $ 386,660 $ (99,668)
</TABLE>

Sub-Advisory and Administration Fees paid to BIMC

<TABLE>
<CAPTION>
Fiscal year ended 10-month period ended
February 28, 1997 December 31, 1997
Net Fee Waiver Net Fee Waiver
<S> <C> <C> <C> <C>
Cash Reserve Fund $ 1,092,344 $ (344,956) $ 1,004,894 $ (288,351)
New York Tax
Exempt Fund $ 287,156 $ (111,543) $ 294,367 $ (88,227)
</TABLE>

<TABLE>
<CAPTION>
Fiscal year ended Fiscal year ended
December 31, 1998 December 31, 1999
Net Fee Waiver Net Fee Waiver
<S> <C> <C> <C> <C>
Cash Reserve Fund $ 943,839 $ (356,758) $ 923,257 $ (387,590)
New York Tax
Exempt Fund $ 265,190 $ (129,280) $ 340,568 $ (149,502)
</TABLE>

Administrative Services/Co-Administration Fees paid to CSAMSI and Counsellors
Service

For the period March 1, 1996 through October 31, 1999,
co-administrative services fees earned by Counsellors Service were as follows:

<TABLE>
<CAPTION>
Fiscal year ended 10-month period ended
February 28, 1997 December 31, 1997
<S> <C> <C>
Cash Reserve Fund $ 436,938 $ 401,957
New York Tax Exempt
Fund $ 114,862 $ 117,747
</TABLE>

Fiscal year ended 10-month period ended
December 31, 1998 October 31, 1999
<S> <C> <C>
Cash Reserve Fund $ 519,004 $ 436,419
New York Tax Exempt
Fund $ 157,551 $ 158,034
</TABLE>

- -35-
<PAGE> 75

For the period November 1, 1999 through December 31, 1999,
co-administrative service fees earned by CSAMSI were as follows:

<TABLE>
<CAPTION>
Fund Co-Administration Fee
<S> <C>
Cash Reserve $87,709
New York Tax Exempt $36,497
</TABLE>

Banking Laws.

BIMC and PNC are subject to certain banking laws and
regulations,

including the Bank Holding Company Act of 1956, as amended, that
restrict their activities. BIMC, PNC and each Fund have been advised by Messrs.
Ballard, Spahr, Andrews & Ingersoll that BIMC and PNC may perform the services
for each Fund contemplated by their respective agreements with the Fund and the
Prospectus without violation of applicable banking laws or regulations. Such
counsel have pointed out, however, that future changes in circumstances or in
legal requirements relating to the permissible activities of banks and their
affiliates, as well as future interpretations of present requirements, could
have the effect of preventing one or more of them from continuing to perform
services for the Fund. If BIMC or PNC were prohibited from providing services
to the Fund, the Board would select another qualified firm. Any new
sub-investment advisory agreement would be subject to shareholder approval.

Custodian and Transfer Agent.

PFPC Trust Company ("PFPC Trust") is custodian of each Fund's
assets pursuant to a custodian agreement (the "Custodian Agreement"). Under the
Custodian Agreement, PFPC Trust (i) maintains a separate account or accounts in
the name of the Fund, (ii) holds and transfers portfolio securities on account
of the Fund, (iii) makes receipts and disbursements of money on behalf of the
Fund, (iv) collects and receives all income and other payments and
distributions on account of the Fund's portfolio securities and (v) makes
periodic reports to the Board concerning the Fund's custodial arrangements.
PFPC Trust is authorized to select one or more banks or trust companies to
serve as sub-custodian on behalf of a Fund, provided that PFPC Trust remains
responsible for the performance of all its duties under the Custodian Agreement
and holds the Fund harmless from the acts and omissions of any sub-custodian.
PFPC Trust has entered into a sub-custodian agreement with PNC Bank, National
Association ("PNC"), pursuant to which PNC provides asset safekeeping and
securities clearing services. PFPC Trust and PNC are indirect, wholly owned
subsidiaries of PNC Bank Corp. and their

- -36-
<PAGE> 76

principal business address is 8800 Tinicum Blvd., Philadelphia, Pennsylvania
19153.

State Street Bank and Trust Company ("State Street") has
agreed to serve as each Fund's shareholder servicing, transfer and dividend
disbursing agent pursuant to a Transfer Agency and Service Agreement, under
which State Street (i) issues and redeems shares of the Fund, (ii) addresses
and mails all communications by the Fund to record owners of the Fund shares,
including reports to shareholders, dividend and distribution notices and proxy
material for its meetings of shareholders, (iii) maintains shareholder accounts
and, if requested, sub-accounts, and (iv) makes periodic reports to the Board
concerning the transfer agent's operations with respect to the Fund. State
Street has delegated to Boston Financial Data Services, Inc. ("BFDS"), a 50%
owned subsidiary, responsibility for most shareholder servicing functions. The
principal business address of State Street is 225 Franklin Street, Boston,
Massachusetts 02110. BFDS's principal business address is 2 Heritage Drive,
Boston, Massachusetts 02171.

Organization of the Fund.

Each Fund was incorporated on November 15, 1984 under the
laws of the State of Maryland as "Counsellors Cash Reserve Fund, Inc." and as
"Counsellors New York Tax Exempt Fund, Inc." On October 27, 1995, the Cash
Reserve Fund and the Tax Exempt Fund each filed an amendment to its charter in
order to change its name to "Warburg, Pincus Cash Reserve Fund, Inc." and
"Warburg, Pincus New York Tax Exempt Fund, Inc.," respectively. Each Fund's
charter authorizes the Board to issue three billion full and fractional shares
of capital stock, $.001 par value per share, of which two billion shares are
designated Advisor Shares. Under each Fund's charter documents, the Board has
the power to classify or reclassify any unissued shares of the Fund into one or
more additional classes by setting or changing in any one or more respects
their relative rights, voting powers, restrictions, limitations as to
dividends, qualifications and terms and conditions of redemption. The Board may
similarly classify or reclassify any class of shares into one or more series
and, without shareholder approval, may increase the number of authorized shares
of the Fund. All shareholders of a Fund, upon liquidation, will participate
ratably in the Fund's net assets.

Multi-Class Structure. Although neither Fund currently does
so, each Fund is authorized to offer a separate class of shares, the Advisor
Shares, pursuant to a separate prospectus. Individual investors could only
purchase Advisor Shares through institutional shareholders of record,
broker-dealers, financial institutions, depository institutions, retirement
plans and other financial intermediaries. Shares of each class would 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
higher fees paid by the Advisor Shares, the total return on such shares can be
expected to be lower than the total return on common shares.

Voting Rights. Investors in a Fund are entitled to one vote
for each full share held and fractional votes for fractional shares held.
Shareholders of a Fund will vote in the aggregate except where otherwise
required by law and except that each class will vote separately on certain
matters pertaining to its distribution and shareholder servicing arrangements.
There will normally be no meetings of investors for the purpose of electing
members of the Board unless and until such time as less than a majority of the
members holding office have been elected by

- -37-
<PAGE> 77

investors. Any Director of a Fund may be removed from office upon the vote of
shareholders holding at least a majority of the relevant Fund's outstanding
shares at a meeting called for that purpose. A meeting will be called for the
purpose of voting on the removal of a Board member at the written request of
holders of 10% of the outstanding shares of a Fund. Shares do not have
cumulative voting rights, which means that holders of more than 50% of the
shares voting for the election of Directors can elect all Directors. Shares are
transferable but have no preemptive, conversion or subscription rights.

ADDITIONAL PURCHASE AND REDEMPTION INFORMATION

Information on how to purchase and redeem Fund shares and how
such shares are priced is included in the Shareholder Guide.

Under the 1940 Act, each Fund may suspend the right of
redemption or postpone the date of payment upon redemption for any period
during which The New York Stock Exchange, Inc. (the "NYSE") is closed, other
than customary weekend and holiday closings, or during which trading on the
NYSE is restricted, or during which (as determined by the SEC by rule or
regulation) an emergency exists as a result of which disposal or fair valuation
of portfolio securities is not reasonably practicable, or for such other
periods as the SEC may permit. (A Fund may also suspend or postpone the
recordation of an exchange of its shares upon the occurrence of any of the
foregoing conditions.)

If the Board of a Fund determines that conditions exist which
make payment of redemption proceeds wholly in cash unwise or undesirable, the
Fund may make payment wholly or partly in securities or other investment
instruments which may not constitute securities as such term is defined in the
applicable securities laws. If a redemption is paid wholly or partly in
securities or other property, a shareholder would incur transaction costs in
disposing of the redemption proceeds. The Fund intends to comply with Rule
18f-1 promulgated under the 1940 Act with respect to redemptions in kind.

Automatic Cash Withdrawal Plan. An automatic cash withdrawal
plan (the "Plan") is available to shareholders who wish to receive specific
amounts of cash periodically. Withdrawals may be made under the Plan by
redeeming as many shares of a Fund as may be necessary to cover the stipulated
withdrawal payment. To the extent that withdrawals exceed dividends,
distributions and appreciation of a shareholder's investment in the Fund, there
will be a reduction in the value of the shareholder's investment and continued
withdrawal payments may reduce the shareholder's investment and ultimately
exhaust it. Withdrawal payments should not be considered as income from
investment in the Fund. All dividends and distributions on shares in the Plan
are automatically reinvested at net asset value in additional shares of the
Fund.

EXCHANGE PRIVILEGE

An exchange privilege with certain other funds advised by
CSAM is available to investors in each Fund. Exchanges may also be made between
certain Warburg Pincus Advisor Funds.

The exchange privilege enables shareholders to acquire shares
in a fund with a different investment objective when they believe that a shift
between funds is an appropriate

- -38-
<PAGE> 78

investment decision. This privilege is available to shareholders residing in
any state in which the Common Shares or Advisor Shares being acquired, as
relevant, may legally be sold. Prior to any exchange, the investor should
obtain and review a copy of the current prospectus of the relevant class of
each fund into which an exchange is being considered. Shareholders may obtain a
prospectus of the relevant class of the fund into which they are contemplating
an exchange from CSAMSI.

Upon receipt of proper instructions and all necessary
supporting documents, shares submitted for exchange are redeemed at the
then-current net asset value of the relevant class and the proceeds are
invested on the same day, at a price as described above, in shares of the
relevant class of the fund being acquired. The exchange privilege may be
modified or terminated at any time upon 30 days' notice to shareholders.

ADDITIONAL INFORMATION CONCERNING TAXES

The discussion set out below of tax considerations generally
affecting a Fund and its shareholders is intended to be only a summary and is
not intended as a substitute for careful tax planning by prospective
shareholders. Shareholders are advised to consult their own tax advisers with
respect to the particular tax consequences to them of an investment in a Fund.

As described above and in the Funds' Prospectus, the New York
Tax Exempt Fund is designed to provide investors with current income which is
excluded from gross income for federal income tax purposes and exempt from New
York State and New York City personal income taxes. The Fund is not intended to
constitute a balanced investment program and is not designed for investors
seeking capital gains or maximum tax-exempt income irrespective of fluctuations
in principal. Investment in the Fund would not be suitable for tax-exempt
institutions, individual retirement plans, employee benefit plans and
individual retirement accounts since such investors would not gain any
additional tax benefit from the receipt of tax-exempt income.

Each Fund intends to continue to qualify as a "regulated
investment company" under Subchapter M of the Code. If it qualifies as a
regulated investment company, a Fund will pay no federal income taxes on its
investment company taxable income (that is, taxable income other than any
excess of its net realized long-term capital gains over its net realized
short-term capital losses ("net realized capital gains")) or on its net
realized capital gains that are distributed to shareholders. To qualify under
Subchapter M, each Fund must, among other things: (i) distribute to its
shareholders at least 90% of the sum of its investment company taxable income
(plus or minus certain adjustments as specified in the Code) and its net
tax-exempt interest income; (ii) derive at least 90% of its gross income from
dividends, interest, payments with respect to loans of securities, gains from
the sale or other disposition of securities, or other income (including, but
not limited to, gains from options, futures, and forward contracts) derived
with respect to the Fund's business of investing in securities; and (iii)
diversify its holdings so that, at the end of each quarter of the Fund's
taxable year (a) at least 50% of the market value of the Fund's assets is
represented by cash, securities of other regulated investment companies, U.S.
Government Securities and other securities, with those other securities
limited, with respect to any one issuer,

- -39-
<PAGE> 79

to an amount no greater in value than 5% of the Fund's total assets and to not
more than 10% of the outstanding voting securities of the issuer, and (b) not
more than 25% of the market value of the Fund's assets is invested in the
securities (other than U.S. Government Securities or securities of other
regulated investment companies) of any one issuer or of two or more issuers
that the Fund controls and which are determined to be in the same or similar
trades or businesses or related trades or businesses. As a regulated investment
company, the Fund will be subject to a 4% non-deductible excise tax measured
with respect to certain undistributed amounts of taxable ordinary income and
capital gain required to be but not distributed under a prescribed formula. The
formula requires payment to shareholders during a calendar year of
distributions representing at least 98% of the Fund's taxable ordinary income
for the calendar year and at least 98% of the excess of its capital gains over
capital losses realized during the one-year period ending October 31 during
such year, together with any undistributed, untaxed amounts of taxable ordinary
income and capital gains from the previous calendar year. The Fund expects to
pay the dividends and make the distributions necessary to avoid the application
of this excise tax.

Although each Fund expects to be relieved of all or
substantially all federal income taxes, depending upon the extent of its
activities in states and localities in which its offices are maintained, in
which its agents or independent contractors are located or in which it is
otherwise deemed to be conducting business, that portion of a Fund's income
which is treated as earned in any such state or locality could be subject to
state and local tax. Any taxes paid by the Fund would reduce the amount of
income and gains available for distribution to shareholders.

If, in any taxable year, a Fund fails to qualify as a
regulated investment company under the Code or fails to meet the distribution
requirement, it would be taxed in the same manner as an ordinary corporation
and distributions to its shareholders would not be deductible by the Fund in
computing its taxable income. In addition, in the event of a failure to
qualify, the Fund's distributions, to the extent derived from the Fund's
current or accumulated earnings and profits, would constitute dividends
(eligible for the corporate dividends-received deduction) which are taxable to
shareholders as ordinary income, even though those distributions might
otherwise (at least in part) have been treated in the shareholders' hands as
long-term capital gains or tax-exempt interest income. If a Fund fails to
qualify as a regulated investment company in any year, it must pay out its
earnings and profits accumulated in that year in order to qualify again as a
regulated investment company. In addition, if the Fund failed to qualify as a
regulated investment company for a period greater than one taxable year, the
Fund may be required to recognize any net built-in gains with respect to
certain of its assets (the excess of the aggregate gains, including items of
income, over aggregate losses that would have been realized if it had been
liquidated) in order to qualify as a regulated investment company in a
subsequent year.

- -40-
<PAGE> 80

Investors in the Cash Reserve Fund should be aware that it is
possible that some portion of the Fund's income from investments in obligations
of foreign banks could become subject to foreign taxes.

Because the New York Tax Exempt Fund will distribute exempt
interest dividends, interest on indebtedness incurred by a shareholder to
purchase or carry Fund shares is not deductible for federal income tax purposes
and New York State and New York City personal income tax purposes. In addition,
if a shareholder of the New York Tax Exempt Fund holds shares for six months or
less, any loss on the sale or exchange of those shares will be disallowed to
the extent of the amount of exempt-interest dividends received with respect to
the shares. The Code may require a shareholder, if he or she receives exempt
interest dividends, to treat as taxable income a portion of certain otherwise
non-taxable social security and railroad retirement benefit payments.
Furthermore, that portion of any dividend paid by the Fund which represents
income derived from so-called "private activity bonds" held by the Fund may not
retain its tax-exempt status in the hands of a shareholder who is a
"substantial user" of a facility financed by such bonds, or a "related person"
thereof. Moreover, as noted in the Fund's prospectus, some of the Fund's
dividends may be a tax preference item, or a component of an adjustment item,
for purposes of the federal individual and corporate alternative minimum taxes.
In addition, the receipt of Fund dividends and distributions may affect a
foreign corporate shareholder's federal "branch profits" tax liability and a
Subchapter S corporation shareholder's federal "excess net passive income" tax
liability. Shareholders should consult their own tax advisers as to whether
they (i) may be "substantial users" with respect to a facility or "related" to
such users within the meaning of the Code and (ii) are subject to a federal
alternative minimum tax, the federal "branch profits" tax, or the federal
"excess net passive income" tax.

While each Fund does not expect to realize net long-term
capital gains, any such realized gains will be distributed as described in the
Prospectus. Such distributions ("capital gain dividends") will be taxable to
shareholders as long-term capital gains, regardless of how long a shareholder
has held Fund shares, and will be designated as capital gain dividends in a
written notice mailed by a Fund to shareholders after the close of the Fund's
taxable year. Gain or loss, if any, recognized on the sale or other disposition
of shares of the Fund will be taxed as capital gain or loss if the shares are
capital assets in the shareholder's hands. Generally, a shareholder's gain or
loss will be a long-term gain or loss if the shares have been held for more
than one year. If a shareholder sells or otherwise disposes of a share of the
Fund before holding it for more than six months, any loss on the sale or other
disposition of such share shall be treated as a long-term capital loss to the
extent of any capital gain dividends received by the shareholder with respect
to such share. This rule will apply to a sale of shares of the New York Tax
Exempt Fund only to the extent the loss is not disallowed under the provision
described above.

A shareholder of a Fund receiving dividends or distributions
in additional shares should be treated for federal income tax purposes as
receiving a distribution in an amount equal to the amount of money that a
shareholder receiving cash dividends or distributions receives, and should have
a cost basis in the shares received equal to that amount.

Each shareholder of the Cash Reserve Fund will receive an
annual statement as to the federal income tax status of his dividends and
distributions from the Fund for the prior calendar year. Furthermore,
shareholders will also receive, if appropriate, various written notices

- -41-
<PAGE> 81

after the close of the Fund's taxable year regarding the federal income tax
status of certain dividends and distributions that were paid (or that are
treated as having been paid) by the Fund to its shareholders during the
preceding year.

Each shareholder of the New York Tax Exempt Fund will receive
an annual statement as to the federal and New York State and New York City
personal income tax status of his dividends and distributions from the Fund for
the prior calendar year. Furthermore, shareholders will also receive, if
appropriate, various written notices after the close of the Fund's taxable year
regarding the federal income tax status of certain dividends and distributions
that were paid (or that are treated as having been paid) by the Fund to its
shareholders during the preceding year. Shareholders should consult their tax
advisers as to any other state and local taxes that may apply to the Fund's
dividends and distributions. The dollar amount of dividends excluded from gross
income for federal income tax purposes and exempt from New York State and New
York City personal income taxation and the dollar amounts subject to federal
income and New York State and New York City personal income taxation, if any,
will vary for each shareholder depending upon the size and duration of each
shareholder's investment in the Fund. In the event that the Fund derives
taxable net investment income, it intends to designate as taxable dividends the
same percentage of each day's dividend as its actual taxable net investment
income bears to its total net investment income earned on that day. Therefore,
the percentage of each day's dividend designated as taxable, if any, may vary
from day to day.

If a shareholder fails to furnish a correct taxpayer
identification number, fails to report fully dividend or interest income, or
fails to certify that he has provided a correct taxpayer identification number
and that he is not subject to withholding, then the shareholder may be subject
to a 31% "backup withholding" tax with respect to taxable dividends and
distributions. An individual's taxpayer identification number is his social
security number. Corporate shareholders and other shareholders specified in the
Code are or may be exempt from backup withholding. The backup withholding tax
is not an additional tax and may be credited against a taxpayer's federal
income tax liability.

THE FOREGOING IS ONLY A SUMMARY OF CERTAIN MATERIAL TAX CONSEQUENCES
AFFECTING A FUND AND ITS SHAREHOLDERS. SHAREHOLDERS ARE ADVISED TO
CONSULT THEIR OWN TAX ADVISERS WITH RESPECT TO THE PARTICULAR
TAX CONSEQUENCES TO THEM OF AN INVESTMENT IN THE FUND.

DETERMINATION OF YIELD

From time to time, each Fund may quote its yield, effective
yield and tax equivalent yield, as applicable, in advertisements or in reports
and other communications to shareholders. The Cash Reserve Fund's yield and
effective yield for the seven-day period ended on December 31, 1999 were 5.18%
and 5.32%, respectively. In the absence of waivers, these yields would have
been 5.12% and 5.25%, respectively. The New York Tax Exempt Fund's yield,
effective yield and tax equivalent yield for the seven-day period ended on
December 31, 1999, was 3.55%, 3.61% and 7.14% (based on a 50.28% total of 3 tax
rates), respectively. In the absence of waivers these yields would have been
3.42%, 3.48% and 6.88%, respectively. Each Fund's seven-day yield is calculated
by (i) determining the net change in the value of a hypothetical pre-existing
account in the Fund having a balance of one share at the beginning of a seven
calendar day period for

- -42-
<PAGE> 82

which yield is to be quoted, (ii) dividing the net change by the value of the
account at the beginning of the period to obtain the base period return and
(iii) annualizing the results (i.e., multiplying the base period return by
365/7). The net change in the value of the account reflects the value of
additional shares purchased with dividends declared on the original share and
any such additional shares, but does not include realized gains and losses or
unrealized appreciation and depreciation. Each Fund's seven-day compound
effective annualized yield is calculated by adding 1 to the base period return
(calculated as described above), raising the sum to a power equal to 365/7 and
subtracting 1. The New York Tax Exempt Fund's tax equivalent yield is
calculated by dividing that portion of the base period return which is exempt
from federal, New York State and New York City personal income taxes by 1 minus
the highest marginal federal, New York State and New York City individual
income tax rates and adding the quotient to that portion, if any, of the yield
which is not exempt from those taxes.

Each Fund's yield will vary from time to time depending upon
market conditions, the composition of a Fund's portfolio and operating expenses
allocable to it. Yield information may be useful in reviewing the Fund's
performance and for providing a basis for comparison with other investment
alternatives. However, the Fund's yield will fluctuate, unlike certain bank
deposits or other investments which pay a fixed yield for a stated period of
time. In comparing the Fund's yield with that of other money market funds,
investors should give consideration to the quality and maturity of the
portfolio securities of the respective funds.

INDEPENDENT ACCOUNTANTS AND COUNSEL

PricewaterhouseCoopers LLP ("PwC"), with principal offices at
2400 Eleven Penn Center, Philadelphia, Pennsylvania 19103, serves as
independent accountants for each Fund. The Funds' financial statements for the
fiscal year ended December 31, 1999, that is incorporated by reference in this
Statement of Additional Information have been audited by PwC, and have been
included herein by reference in reliance upon the report of such firm of
independent accountants given upon their authority as experts in accounting and
auditing.

Willkie Farr & Gallagher serves as counsel for each Fund and
provides legal services from time to time for CSAM and CSAMSI.

MISCELLANEOUS

The Funds are not sponsored, endorsed, sold or promoted by
Warburg, Pincus & Co. Warburg, Pincus & Co. makes no representation or
warranty, express or implied, to the owners of the Funds or any member of the
public regarding the advisability of investing in securities generally or in
the Funds particularly. Warburg, Pincus & Co. licenses certain trademarks and
trade names of Warburg, Pincus & Co., and is not responsible for and has not
participated in the calculation of the Funds' net asset value, nor is Warburg,
Pincus & Co. a distributor of the Funds. Warburg, Pincus & Co. has no
obligation or liability in connection with the administration, marketing or
trading of the Funds.

As of April 1, 2000, the name, address and percentage of
ownership of other persons that control a Fund (within the meaning of the rules
and regulations

- -43-
<PAGE> 83

under the 1940 Act) or own of record 5% or more of the Fund's outstanding
shares were as follows:

<TABLE>
<CAPTION>
- --------------------------------------------------------------------------- ------------------------------------------
CASH RESERVE FUND COMMON STOCK
- --------------------------------------------------------------------------- ------------------------------------------
<S> <C>
Neuberger and Berman* 32.51%
#114000
Attn.: Operations Control Dept.
Steve Gallaro
55 Water Street, FL 27
New York, NY 10041-0001

- --------------------------------------------------------------------------- ------------------------------------------
Fiduciary Trust Company International* 28.95%
Cust A/C Attn Felyce Porr
Securities Services Group
Church Street Station
P.O. Box 3199
New York, NY 10008-3199

- --------------------------------------------------------------------------- ------------------------------------------
</TABLE>

<TABLE>
<CAPTION>
- --------------------------------------------------------------------------- ------------------------------------------
NEW YORK TAX EXEMPT FUND COMMON STOCK
- --------------------------------------------------------------------------- ------------------------------------------
<S> <C>
Neuberger & Berman* 49.42%
#114000
Attn.: Operations Control Dept.
Steve Gallaro
55 Water Street, FL 27
New York, NY 10041-0001
- --------------------------------------------------------------------------- ------------------------------------------
Fiduciary Trust Company International* 41.28%
Cust A/C Attn Felyce Porr
Securities Services Group
Church Street Station
P.O. Box 3199
New York, NY 10008-3199
- --------------------------------------------------------------------------- ------------------------------------------
</TABLE>

*To the knowledge of each Fund, these entities are not the
beneficial owners of a majority of the shares held by them of record.

- -44-
<PAGE> 84

FINANCIAL STATEMENTS

Each Fund's audited annual report, dated December 31, 1999,
which either accompanies this Statement of Additional Information or has
previously been provided to the investor to whom this Statement of Additional
Information is being sent, is incorporated herein by reference. A Fund will
furnish without charge a copy of its annual report upon request by calling
Warburg Pincus Funds at (800) 927-2874.

- -45-
<PAGE> 85

APPENDIX

Description of Commercial Paper Ratings

Commercial paper rated A-1 by Standard & Poor's Ratings
Services ("S&P") indicates that the degree of safety regarding timely payment
is strong. Those issues determined to possess extremely strong safety
characteristics are denoted with a plus sign designation. Capacity for timely
payment on commercial paper rated A-2 is satisfactory, but the relative degree
of safety is not as high as for issues designated A-1.

The rating Prime-1 is the highest commercial paper rating
assigned by Moody's Investor Services, Inc. ("Moody's"). Issuers rated Prime-1
(or related supporting institutions) are considered to have a superior capacity
for repayment of short-term promissory obligations. Issuers rated Prime-2 (or
related supporting institutions) are considered to have a strong capacity for
repayment of short-term promissory obligations. This will normally be evidenced
by many of the characteristics of issuers rated Prime-1 but to a lesser degree.
Earnings trends and coverage ratios, while sound, will be more subject to
variation. Capitalization characteristics, while still appropriate, may be more
affected by external conditions. Ample alternative liquidity is maintained.

Short term obligations, including commercial paper, rated A1
+ by IBCA are obligations supported by the highest capacity for timely
repayment. Obligations rated A1 have a very strong capacity for timely
repayment. Obligations rated A2 have a strong capacity for timely repayment,
although such capacity may be susceptible to adverse changes in business,
economic or financial conditions.

Fitch Investors Services, Inc. employs the rating F-1+ to
indicate issues regarded as having the strongest degree of assurance for timely
payment. The rating F-1 reflects an assurance of timely payment only slightly
less in degree than issues rated F-1+, while the rating F-2 indicates a
satisfactory degree of assurance for timely payment, although the margin of
safety is not as great as indicated by the F-1+ and F-1 categories.

Duff & Phelps, Inc. employs the designation of Duff 1 with
respect to top grade commercial paper and bank money instruments. Duff 1+
indicates the highest certainty of timely payment: short-term liquidity is
clearly outstanding and safety is just below risk-free U.S. Treasury short-term
obligations. Duff 1- indicates high certainty of timely payment. Duff 2
indicates good certainty of timely payment: liquidity factors and company
fundamentals are sound.

<PAGE> 86

<PAGE> 87

Description of Municipal Securities Ratings

The following summarizes the highest two ratings used by S&P
for Municipal Securities:

AAA - This is the highest rating assigned by S&P to a debt
obligation and indicates an extremely strong capacity to pay interest and repay
principal.

AA - Debt rated AA has a very strong capacity to pay interest
and repay principal and differs from AAA issues only in small degree.

To provide more detailed indications of credit quality, the
"AA" rating may be modified by the addition of a plus or minus sign to show
relative standing within this major rating category.

The following summarizes the highest two ratings used by
Moody's for bonds:

Aaa - Bonds that are rated Aaa are judged to be of the best
quality. They carry the smallest degree of investment risk and are generally
referred to as "gilt edge." Interest payments are protected by a large or
exceptionally stable margin and principal is secure. While the various
protective elements are likely to change, such changes as can be visualized are
most unlikely to impair the fundamentally strong position of such issues.

Aa - Bonds that are rated As are judged to be of high quality
by all standards. Together with the Aaa group they are rated lower than the
best bonds because margins of protection may not be as large as in Aaa
securities or fluctuation of protective elements may be of greater amplitude or
there may be other elements present which make the long-term risks appear
somewhat larger than in Aaa securities.

Moody's applies numerical modifiers (1, 2 and 3) with respect
to the bonds rated Aa. The modifier 1 indicates that the bond being rated
ranks in the higher end of its generic rating category; the modifier 2
indicates a mid-range ranking; and the modifier 3 indicates that the bond ranks
in the lower end of its generic rating category.

The following summarizes the two highest ratings used by S&P
for short-term notes:

SP-1 - Loans bearing this designation evidence a very strong
or strong capacity to pay principal and interest. Those issues determined to
possess overwhelming safety characteristics will be given a (+) designation.

SP-2 - Loans bearing this designation evidence a satisfactory
capacity to pay principal and interest.

<PAGE> 88

The following summarizes the two highest ratings used by
Moody's for short-term notes and variable rate demand obligations:

MIG-1/VMIG-1 - Obligations bearing these designations are of
the best quality, enjoying strong protection from established cash flows of
funds for their servicing or from established and broad-based access to the
market for refinancing, or both.

MIG-2/VMIG-2 - Obligations bearing these designations are of
high quality with margins of protection ample although not so large as in the
preceding group.

Commercial paper rated A-1 by S&P indicates that the degree
of safety regarding timely payment is strong. Those issues determined to
possess extremely strong safety characteristics are denoted with a plus sign
designation. Capacity for timely payment on commercial paper rated A-2 is
satisfactory, but the relative degree of safety is not as high as for issues
designated A-1.

The rating Prime-1 is the highest commercial paper rating
assigned by Moody's Investors Services, Inc. Issuers rated Prime-1 (or related
supporting institutions) are considered to have a superior capacity for
repayment of short-term promissory obligations. Issuers rated Prime-2 (or
related supporting institutions) are considered to have a strong capacity for
repayment of short-term promissory obligations. This will normally be evidenced
by many of the characteristics of issuers rated Prime-1 but to a lesser degree.
Earnings trends and coverage ratios, while sound, will be more subject to
variation. Capitalization characteristics, while still appropriate, may be more
affected by external conditions. Ample alternative liquidity is maintained.

<PAGE> 89

PART C

OTHER INFORMATION

Item 23. Exhibits

<TABLE>
<S> <C>
a(1) Articles of Incorporation.(1)

a(2) Articles of Amendment.(2)

a(3) Articles Supplementary.(2)

b(1) Amended and Restated By-Laws.(1)

b(2) Amendment to By-Laws.(3)

b(3) Amendment to By-Laws(4)

c(1) Form of certificates for common stock.(1)

d(1) Form of Investment Advisory Agreement.(5)

d(2) Form of Sub-Investment Advisory and Administration
Agreement.(1)

d(3) Form of Co-Administration Agreement.(6)

e Distribution Agreement with Provident Distributors, Inc.
("PDI").(7)
</TABLE>

- ----------
(1) Incorporated by reference to Post-Effective Amendment No. 12 to the
Registration Statement on Form N-1A for Warburg, Pincus Cash Reserve
Fund, Inc. filed on June 28, 1995 (Securities Act File No. 2-94840).

(2) Incorporated by reference to Post-Effective Amendment No. 14 to the
Registration Statement on Form N-1A for Warburg, Pincus Cash Reserve
Fund, Inc. filed on June 25, 1997 (Securities Act File No. 2-94840).

(3) Incorporated by reference to Post-Effective Amendment No. 13 to the
Registration Statement on Form N-1A for Warburg, Pincus Cash Reserve
Fund, Inc. filed on July 1, 1996 (Securities Act File No. 2-94840).

(4) Incorporated by reference to Post-Effective Amendment No. 2 to the
Registration Statement on Form N-1A for Warburg, Pincus Health Sciences
Fund, Inc. filed on February 23, 1998 (Securities Act File No.
333-15419

(5) Incorporated by reference; material provisions of this exhibit
substantially similar to those of the corresponding exhibit in the
Registration Statement on Form N-14 of Warburg, Pincus Global Post-
Venture Capital Fund, Inc., filed November 4, 1999 (Securities Act File
No. 333-90341).

(6) Incorporated by reference to the Registration Statement on Form N-14 of
Warburg, Pincus Global Post-Venture Capital Fund, Inc. filed November
4, 1999 (Securities Act File No. 333-90341).

(7) Incorporated by reference to Post-Effective Amendment No. 9 to the
Registration Statement on Form N-1A of Warburg, Pincus Balanced Fund,
Inc. filed on February 24, 2000 (Securities Act File No. 333-00533).

<PAGE> 90

<TABLE>
<S> <C>
f Not applicable.

g(1) Custodian Agreement with PNC Bank, National Association.(8)

(2) Form of Sub-Custodian Services Agreement with PFPC Trust
Company and PNC Bank, National Association.(8)

h Form of Transfer Agency Agreement.(1)

i Opinion and Consent of Willkie Farr & Gallagher.

j(1) Consent of PricewaterhouseCoopers LLP.

j(2) Powers of Attorney.(6)

k Not applicable.

l Form of Purchase Agreement.(1)

m(1) Form of Shareholder Servicing and Distribution Plan.(6)

m(2) Form of Distribution Plan.(6)

n Not applicable.

o Not applicable.

p Form of Code of Ethics.
</TABLE>

Item 24. Persons Controlled by or Under Common Control
with Registrant

From time to time, Credit Suisse Asset Management, LLC ("CSAM, LLC")
may be deemed to control the Fund and other registered investment companies it
advises through its beneficial ownership of more than 25% of the relevant fund's
shares on behalf of discretionary advisory clients. CSAM, LLC has three
wholly-owned subsidiaries: Warburg, Pincus Asset Management International, Inc.,
a Delaware corporation; Warburg Pincus Asset Management (Japan), Inc., a
Japanese corporation and Warburg Pincus Asset Management (Dublin) Limited, an
Irish corporation.

- --------------------
(8) Incorporated by reference; material provisions of this exhibit are
substantially similar to those of the corresponding exhibit to Post-
Effective Amendment No. 10 to the Registration Statement on Form N-1A
of Warburg, Pincus Trust filed on April 16, 1999 (Securities Act File
No. 33-58125).

<PAGE> 91

Item 25. Indemnification

Registrant, and officers and directors of CSAM, LLC, Credit Suisse
Asset Management Securities, Inc. and Registrant, are covered by insurance
policies indemnifying them for liability incurred in connection with the
operation of Registrant. Discussion of this coverage is incorporated by
reference to Item 27 of Part C of the Registration Statement of Warburg, Pincus
Trust (Securities Act File No. 33-58125), filed on March 17, 1995.

Item 26. (a) Business and Other Connections of
Investment Adviser

CSAM, LLC acts as investment adviser to Registrant. CSAM, LLC renders
investment advice to a wide variety of individual and institutional clients. The
list required by this Item 26 of officers and directors of CSAM, LLC, together
with information as to their other business, profession, vocation or employment
of a substantial nature during the past two years, is incorporated by reference
to Schedules A and D of Form ADV filed by CSAM, LLC (SEC File No. 801-37170).

(b) Business and Other Connections of
Sub-Investment Adviser and Administrator

BlackRock Institutional Management Corporation ("BIMC"), a wholly owned
indirect subsidiary of PNC Bank, National Association ("PNC"), performs
sub-investment advisory services for Registrant and advisory services for
certain other investment companies. PNC and its predecessors have been in the
business of managing the investments of fiduciary and other accounts in the
Philadelphia area since 1847. In addition to its trust business, PNC provides
commercial banking services. The list required by this Item 26 of officers and
directors of BIMC, together with information as to their other business,
profession, vocation or employment of a substantial nature during the past two
years, is by BIMC (SEC File No. 801-13-304).

Item 27. Principal Underwriter

(a) PDI acts as distributor for Registrant, as well as for Warburg
Pincus Balanced Fund; Warburg Pincus Capital Appreciation Fund; Warburg Pincus
Central & Eastern Europe Fund; Warburg Pincus Emerging Growth Fund; Warburg
Pincus Emerging Markets Fund; Warburg Pincus European Equity Fund; Warburg
Pincus Fixed Income Fund; Warburg Pincus Focus Fund; Warburg Pincus Global Fixed
Income Fund; Warburg Pincus Global Health Sciences Fund; Warburg Pincus Global
Post-Venture Capital Fund; Warburg Pincus Global Telecommunications Fund;
Warburg Pincus High Yield Fund; Warburg Pincus Institutional Fund; Warburg
Pincus Intermediate Maturity Government Fund; Warburg Pincus International
Equity Fund; Warburg Pincus International Growth Fund; Warburg Pincus
International Small Company Fund; Warburg

<PAGE> 92

Pincus Japan Growth Fund; Warburg Pincus Japan Small Company Fund; Warburg
Pincus Long-Short Market Neutral Fund; Warburg Pincus Major Foreign Markets
Fund; Warburg Pincus Municipal Bond Fund; Warburg Pincus New York Intermediate
Municipal Fund; Warburg Pincus New York Tax Exempt Fund; Warburg Pincus Small
Company Growth Fund; Warburg Pincus Small Company Value Fund; Warburg Pincus
Strategic Global Fixed Income Fund; Warburg Pincus Trust; Warburg Pincus Trust
II; Warburg Pincus U.S. Core Equity Fund; Warburg Pincus U.S. Core Fixed Income
Fund; Warburg Pincus Value Fund; Warburg Pincus WorldPerks Money Market Fund;
and Warburg Pincus WorldPerks Tax Free Money Market Fund.

PDI also acts as principal underwriter for the following investment
companies: International Dollar Reserve Fund I, Ltd.; Provident Institutional
Funds Trust; Columbia Common Stock Fund, Inc.; Columbia Growth Fund, Inc.;
Columbia International Stock Fund, Inc.; Columbia Special Fund, Inc.; Columbia
Small Cap Fund, Inc.; Columbia Real Estate Equity Fund, Inc.; Columbia Balanced
Fund, Inc.; Columbia Daily Income Company; Columbia U.S. Government Securities
Fund, Inc.; Columbia Fixed Income Securities Fund, Inc.; Columbia Municipal Bond
Fund, Inc.; Columbia High Yield Fund, Inc.; Columbia National Municipal Bond
Fund, Inc.; GAMNA Series Funds, Inc.; WT Investment Trust; Kalmar Pooled
Investment Trust; The RBB Fund, Inc.; Robertson Stephens Investment Trust; HT
Insight Funds, Inc.; Harris Insight Funds Trust; Hilliard-Lyons Government Fund,
Inc.; Hilliard-Lyons Growth Fund, Inc.; Hilliard-Lyons Research Trust; Senbanc
Fund; ABN AMRO Funds; Alleghany Funds; BT Insurance Funds Trust; First Choice
Funds Trust; Forward Funds, Inc.; IAA Trust Asset Allocation Fund, Inc.; IAA
Trust Growth Fund, Inc.; IAA Trust Tax Exempt Bond Fund, Inc.; IAA Trust Taxable
Fixed Income Series Fund, Inc.; IBJ Funds Trust; Light Index Funds, Inc.; LKCM
Funds; Matthews International Funds; McM Funds; Metropolitan West Funds; New
Covenant Funds, Inc.; Panorama Trust; Smith Breeden Series Funds; Smith Breeden
Trust; Stratton Growth Funds, Inc.; Stratton Monthly Dividend REIT Shares, Inc.;
The Stratton Funds, Inc.; The Galaxy Fund; The Galaxy VIP Fund; Galaxy Fund II;
The Govett Funds, Inc.; Trainer, Wortham First Mutual Funds; Undiscovered
Managers Funds; Wilshire Target Funds, Inc.; Weiss, Peck & Greer Funds Trust;
Weiss, Peck & Greer International Fund; WPG Growth and Income Fund; WPG Growth
Fund; WPG Tudor Fund; RWB/WPG U.S. Large Stock Fund; Tomorrow Funds Retirement
Trust; The BlackRock Funds, Inc. (distributed by BlackRock Distributors, Inc. a
wholly owned subsidiary of PDI); Northern Funds Trust and Northern Institutional
Funds Trust (distributed by Northern Funds Distributors, LLC a wholly owned
subsidiary of PDI); The Offit Investment Fund, Inc. (distributed by Offit Funds
Distributor, Inc. a wholly owned subsidiary of PDI) and The Offit Variable
Insurance Fund, Inc. (distributed by Offit Funds Distributor, Inc. a wholly
owned subsidiary of PDI).

(b) For information relating to each director, officer or partner of
PDI, reference is made to Form BD (SEC File No.

<PAGE> 93

8-46564) filed by PDI under the Securities Exchange Act of 1934.

Item 28. Location of Accounts and Records

(1) Warburg, Pincus Cash Reserve Fund, Inc.
466 Lexington Avenue
New York, New York 10017-3147
(Fund's articles of incorporation, by-laws and minute books)

(2) BlackRock Institutional Management Corporation
400 Bellevue Parkway
Wilmington, Delaware 19809
(records relating to its functions as sub-investment adviser
and administrator)

(3) Credit Suisse Asset Management Securities, Inc.
466 Lexington Avenue
New York, New York 10017-3147
(records relating to its functions as co-administrator)

(4) PFPC Inc.
400 Bellevue Parkway
Wilmington, Delaware 19809
(records relating to its functions as transfer and dividend
disbursing agent)

(5) PFPC Trust Company
8800 Tinicum Boulevard
Philadelphia, Pennsylvania 19153
(records relating to its functions as custodian)

(6) Credit Suisse Asset Management, LLC
One Citicorp Center
153 East 53rd Street
New York, New York 10022
(records relating to its functions as investment adviser)

(7) State Street Bank and Trust Co.
225 Franklin Street
Boston, Massachusetts 02110
(records relating to its functions as custodian, transfer
agent and dividend disbursing agent)

(8) Boston Financial Data Services, Inc.
2 Heritage Drive
North Quincy, Massachusetts 02177
(records relating to its functions as transfer agent and
dividend disbursing agent)

<PAGE> 94

(9) Provident Distributors, Inc.
3200 Horizon Drive
King of Prussia, PA 19406
(records relating to its functions as distributor)

Item 29. Management Services

Not applicable.

Item 30. Undertakings

Not applicable.

<PAGE> 95

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, as amended,
and the Investment Company Act of 1940, as amended, the Registrant certifies
that it meets all of the requirements for effectiveness of this Amendment to the
Registration Statement pursuant to Rule 485(b) under the Securities Act of 1933,
as amended and has duly caused this Amendment to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of New York and the State of
New York, on the 28th day of April, 2000.

WARBURG, PINCUS CASH RESERVE FUND, INC.

By:/s/Eugene L. Podsiadlo
---------------------------------
Eugene L. Podsiadlo
President

Pursuant to the requirements of the Securities Act of 1933, as amended,
this Amendment has been signed below by the following persons in the capacities
and on the date indicated:

<TABLE>
<CAPTION>
Signature Title Date
- --------- ----- ----
<S> <C> <C>
/s/William W. Priest* Chairman of the April 28, 2000
- ------------------------------ Board of Directors
William W. Priest

/s/Eugene L. Podsiadlo President April 28, 2000
- ------------------------------
Eugene L. Podsiadlo

/s/Michael A. Pignataro Treasurer and April 28, 2000
- ------------------------------ Chief Financial
Michael A. Pignataro Officer

/s/Richard H. Francis* Director April 28, 2000
- ------------------------------
Richard H. Francis

/s/Jack W. Fritz* Director April 28, 2000
- ------------------------------
Jack W. Fritz

/s/Jeffrey E. Garten* Director April 28, 2000
- ------------------------------
Jeffrey E. Garten

/s/James S. Pasman, Jr.* Director April 28, 2000
- ------------------------------
James S. Pasman, Jr.

/s/Steven N. Rappaport* Director April 28, 2000
- ------------------------------
Steven N. Rappaport

/s/Alexander B. Trowbridge* Director April 28, 2000
- ------------------------------
Alexander B. Trowbridge

*By: /s/Michael A. Pignataro
- ------------------------------
Michael A. Pignataro as Attorney-in-Fact
</TABLE>

<PAGE> 96

INDEX TO EXHIBITS

<TABLE>
<CAPTION>
Exhibit No. Description of Exhibit
- ----------- ----------------------
<S> <C>
i Opinion and Consent of Willkie Farr & Gallagher, counsel
to the Fund.

j(1) Consent of PricewaterhouseCoopers LLP, Independent
Accountants.

p Form of Code of Ethics.
</TABLE>

<PAGE> 1
EXHIBIT i
April 28, 2000

Warburg, Pincus Cash Reserve Fund, Inc.
466 Lexington Avenue
New York, New York 10017-3147

Re: Post-Effective Amendment No. 18 to Registration Statement
(Securities Act File No. 2-94840; Investment Company Act
File No. 811-4171)

Ladies and Gentlemen:

You have requested us, as counsel to Warburg, Pincus Cash Reserve Fund, Inc.
(the "Fund"), a corporation organized under the laws of the State of Maryland,
to furnish you with this opinion in connection with the Fund's filing of
Post-Effective Amendment No. 18 (the "Amendment") to its Registration Statement
on Form N-1A (the "Registration Statement").

We have examined copies of the Fund's Articles of Incorporation, as amended or
supplemented to the date hereof (the "Articles"), the Fund's By-Laws, as
amended to the date hereof (the "By-Laws"), and the Amendment. We have also
examined such other records, documents, papers, statutes and authorities as we
have deemed necessary to form a basis for the opinion hereinafter expressed.

In our examination of material, we have assumed the genuineness of all
signatures, the authenticity of all documents submitted to us as originals and
the conformity to original documents of all copies submitted to us. As to
various questions of fact material to our opinion, we have relied upon
statements and certificates of officers and representatives of the Fund and
others.

Based upon the foregoing, we are of the opinion that the shares of common stock
of the Fund, par value $.001 per share (the "Shares"), when and if duly sold,
issued and paid for in accordance with the laws of applicable jurisdictions and
the terms of the Articles, the By-Laws and the Registration Statement, will be
valid, legally issued, fully paid and non-assessable, assuming (i) that at the
time of sale such Shares are sold at a sales price in each case in excess of
the par value of the Shares; (ii) that the issuance of the Shares does not
cause the number of outstanding Shares to exceed the number of authorized
Shares to exceed the number of authorized Shares provided for in the Articles,
as amended to the date of issuance; and (iii) that resolutions of the Board of
Directors authorizing the issuance of the Shares that are in effect on the date
hereof have not been modified or withdrawn and are in full force and effect on
the date of issuance.

<PAGE> 2

Warburg, Pincus Cash Reserve Fund, Inc.
April 28, 2000
Page 2

We hereby consent to the filing of this opinion as an exhibit to the Amendment,
to any reference to our name under the heading "Independent Accountants and
Counsel" in the Statement of Additional Information included as part of the
Amendment, and to the filing of this opinion as an exhibit to any application
made by or on behalf of the Fund or any distributor or dealer in connection
with the registration or qualification of the Fund or the Shares under the
securities laws of any state or other jurisdiction.

We are members of the Bar of the State of New York only and do not opine as to
the laws of any jurisdiction other than the laws of the State of New York and
the laws of the United States, and the opinions set forth above are,
accordingly, limited to the laws of those jurisdictions.

Very truly yours,

/s/WILLKIE FARR & GALLAGHER

<PAGE> 1
CONSENT OF INDEPENDENT ACCOUNTANTS

We hereby consent to the incorporation by reference in this Post-Effective
Amendment No. 18 to the Registration Statement under the Securities Act of 1933
and Post-Effective Amendment No. 20 to the Registration Statement under the
Investment Company Act of 1940 on Form N-1A (File Nos. 2-94840 and 811-4171,
respectively) of our report dated February 3, 2000 on our audit of the financial
statements and financial highlights of Warburg, Pincus Cash Reserve Fund Inc.,
which report is included in the Annual Report to Shareholders for the year ended
December 31, 1999 and for the respective periods then ended. We also consent to
the reference of our firm under the heading "Financial Highlights" in the
Prospectus and "Independent Accountants and Counsel" in the Statement of
Additional Information.

/s/PricewaterhouseCoopers LLP

PricewaterhouseCoopers LLP
April 25, 2000
2400 Eleven Penn Center
Philadelphia, Pennsylvania

<PAGE> 1

EXHIBIT p

CREDIT SUISSE ASSET MANAGEMENT, LLC
WARBURG PINCUS FUNDS/CSAM CLOSED-END FUNDS
CODE OF ETHICS

I. APPLICABILITY

This Code of Ethics establishes rules of conduct for "Access Persons" (as
defined below) of Credit Suisse Asset Management, LLC, its subsidiaries and
Credit Suisse Asset Management Securities, Inc. (collectively referred to as
"CSAM") and each U.S. registered investment company that adopts this Code
("Covered Fund") (CSAM and the Covered Funds are collectively referred to as the
"Covered Companies"). For purposes of this Code, "Access Person" shall mean:

- - any "Advisory Person" -- any employee or officer of CSAM and any natural
person in a control relationship to a Covered Company (except for a
natural persons who, but for their his or her holdings in a Covered Fund,
would not be considered an Advisory Person, unless they he or she obtains
information concerning recommendations made to the Covered Fund with
regard to the purchase or sale of securities by the Covered Fund, in which
case such person shall be considered an Advisory Person only with respect
to the Covered Fund); or

- - any director, trustee or officer of a Covered Fund, whether or not such
person is an Advisory Person, in which case such person shall be
considered an Access Person only with respect to the Covered Fund.

For purposes of this Code:

- - the term "security" shall include any option to purchase or sell, any
security that is convertible or exchangeable for, and any other derivative
interest relating to the security; and

- - the terms "purchase" and "sale" of a security shall include, among other
things, the writing of an option to purchase or sell a security; and

<PAGE> 2

- - all other terms .shall have the same meanings as under the Investment
Company Act of 1940 ("1940 Act"), unless indicated otherwise.

II. Statement of General Principles

In conducting personal investment activities, all Access Persons are required to
act consistent with the following general fiduciary principles:

- - the interests of CSAM clients, including Covered Funds, must always be
placed first, provided, however, that persons who are Access Persons only
with respect to certain Covered Funds shall place the interests of such
Covered Funds first;

- - all personal securities transactions must be conducted in such a manner
as to avoid any actual or potential conflict of interest or any abuse of
an individual's position of trust and responsibility; and

- - Access Persons must not take inappropriate advantage of their positions.

CSAM has a separate policy and procedures designed to detect and prevent insider
trading, which should be read together with this Code. Nothing contained in this
Code should be interpreted as relieving any Access Person from the obligation to
act in accordance with any applicable law, rule or regulation or any other
statement of policy or procedure adopted by any Covered Company.

III. Prohibitions

The following prohibitions and related requirements apply to Advisory Persons
and/or Access Persons (as stated) and accounts in which they have "Beneficial
Ownership" (as defined in Exhibit 1).

A. Short Term Trading. CSAM discourages Advisory Persons from short-term trading
(i.e., purchases and sales within a 60 day period), as such activity could be
viewed as being in conflict with CSAM's general fiduciary principles. In no
event, however, may an

<PAGE> 3

Advisory Person make a purchase and sale (or sale and purchase) of a security,
including shares of Covered Funds and other U.S. registered open-end investment
companies (other than money market funds), within five "Business Days" (meaning
days on which the New York Stock Exchange is open for trading). CSAM reserves
the right to extend this prohibition period for the short-term trading
activities of any or all Advisory Persons if CSAM determines that such
activities are being conducted in a manner that may be perceived to be in
conflict with CSAM's general fiduciary principles.

B. Side-by-Side Trading. No Access Person may purchase or sell (directly or
indirectly) any security for which there is a "buy" or "sell" order pending for
a CSAM client (except that this restriction does not apply to any Access Person
who is neither an Advisory Person nor an officer of a Covered Fund, unless he or
she knows, or in the ordinary course of fulfilling official duties with a
Covered Fund should know, that there is a "buy" or "sell" order pending with
respect to such security for a CSAM client), or that such Access Person knows
(or should know) at the time of such purchase or sale:

- - is being considered for purchase or sale by or for any CSAM client; or

- - is being purchased or sold by or for any CSAM client.

C. Blackout Periods. No Advisory Person may execute a securities transaction
within five Business Days before and one Business Day after a transaction in
that security for a CSAM client.

D. Public Offerings. No Advisory Person may directly or indirectly acquire
Beneficial Ownership in any security in a public offering in the primary
securities market.

E. Private Placements. No Advisory Person may directly or indirectly acquire or
dispose of any Beneficial Ownership in any privately placed security without
the express prior written approval of a supervisory person designated in
Section IX of this Code ("Designated Supervisory Person"). Approval will

<PAGE> 4

take into account, among other factors, whether the investment oportunity should
be reserved for a CSAM client, whether the opportunity is being offered to the
Advisory Person because of his or her position with CSAM or as a reward for past
transactions and whether the investment creates or may in the future create a
conflict of interest.

F. Short Selling. Advisory Persons are only permitted to engage in short selling
for hedging purposes. No Advisory Person may engage in any transaction that has
the effect of creating any net "short exposure" in an individual security.

G. Futures Contracts. No Advisory Person may invest in futures contracts, except
through the purchase of options on futures contracts.

H. Options. No Advisory Person may write (i.e., sell) any options except for
hedging purposes and only if the option is fully covered.

I. Trading, Hedging and Speculation in Credit Suisse Group Securities.
Transactions by employees, officers and directors of CSAM in securities of
Credit Suisse Group ("CSG") are prohibited for each period beginning 15 calendar
days before announcement of CSG yearly or half-yearly results and ending two
Business Days after the announcement. Employees, officers and directors of CSAM
may only hedge vested positions in CSG stock through short sales or derivative
instruments. Uncovered short exposure, through short sales or otherwise, is not
permitted without the express prior written approval of a Designated Supervisory
Person.

J. Investment Clubs. No Advisory Person may participate in an "investment
club" or similar activity.

K. Disclosure of Interest. No Advisory Person may recommend to or effect for any
CSAM client any securities transaction without having disclosed his or her
personal interest (actual or potential), if any, in the issuer of the
securities, including without limitation:

<PAGE> 5

- - any ownership or contemplated ownership of any privately placed securities of
the issuer or any of its affiliates;

- - any employment, management or official position with the issuer or any of its
affiliates;

- - any present or proposed business relationship between the Advisory Person and
the issuer or any of its affiliates; and

- - any additional factors that may be relevant to a conflict of interest
analysis.

Where the Advisory Person has a personal interest in an issuer, a decision to
purchase or sell securities of the issuer or any of its affiliates by or for a
CSAM client shall be subject to an independent review by a Designated
Supervisory Person.

L. Gifts. No Advisory Person may seek or accept any gift of more than a de
minimis value (approximately $250 per year) from any person or entity that does
business with or on behalf of a CSAM client, other than reasonable,
business-related meals and tickets to sporting events, theater and similar
activities. If any Advisory Person is unsure of the appropriateness of any gift,
a Designated Supervisory Person should be consulted.

M. Directorships and Other Outside Business Activities. No Advisory Person may
serve on the board of directors/trustees of any issuer without the express prior
written approval of a Designated Supervisory Person. Approval will be based upon
a determination that the board service would be consistent with the interests of
CSAM clients. Where board service is authorized, Advisory Persons serving as
directors will be isolated from those making investment decisions regarding the
securities of that issuer through "informational barrier" or other procedures
specified by a Designated Supervisory Person.

No Advisory Person may be employed (either for compensation or in a voluntary
capacity) outside his or her regular position with CSAM or its affiliated

<PAGE> 6

companies without the written approval of a Designated Supervisory Person.

IV. EXEMPT TRANSACTIONS

A. Exemptions from Prohibitions.

1. Purchases and sales of securities issued or guaranteed by the U.S.
government or any agencies or instrumentalities of the U.S. government,
municipal securities, and other non-convertible fixed income securities, which
are in each case rated investment grade, are exempt from the prohibitions
described in paragraphs C and D of Section III if such transactions are made in
compliance with the preclearance requirements of Section V(B) below.

2. Any securities transaction, or series of related transactions,
involving 500 shares or less of an issuer having a market capitalization
(outstanding shares multiplied by the current market price per share) greater
than $2.5 billion is exempt from the prohibition described in paragraph C of
Section III if such transaction is made in compliance with the preclearance
requirements of Section V(B) below.

B. Exemptions from Prohibitions and Preclearance. The prohibitions described in
paragraphs B through E of Section III and the preclearance requirements of
Section V(B) shall not apply to:

- - purchases and sales of securities that are direct obligations of the U.S.
government;

- - purchases and sales of securities of U.S. registered open-end investment
companies;

- - purchases and sales of bankers' acceptances, bank certificates of deposit, and
commercial paper;

- - purchases that are part of an automatic dividend reinvestment plan;

- - purchases and sales that are non-volitional on the part of either the Access
Person or the CSAM client;

<PAGE> 7

- - purchases and sales in any account maintained with a party that has no
affiliation with the Covered Companies and over which no Advisory Person
has, in the judgment of a Designated Supervisory Person after reviewing
the terms and circumstances, direct or indirect influence or control over
the investment or trading of the account; and

- - purchases by the exercise of rights offered by an issuer pro rata to all
holders of a class of its securities, to the extent that such rights were
acquired from the issuer, and sales of these rights.

C. Further Exemptions. Express prior written approval may be granted by a
Designated Supervisory Person if a purchase or sale of securities or other
outside activity is consistent with the purposes of this Code and Section 17(j)
of the Investment Company Act of 1940 ("1940 Act") and rules thereunder
(attached as Attachment B A is a form to request such approval). For example, a
purchase or sale may be considered consistent with those purposes if the
purchase or sale is not harmful to a CSAM client because such purchase or sale
would be unlikely to affect a highly institutional market, or because such
purchase or sale is clearly not related economically to the securities held,
purchased or sold by the CSAM client.

V. TRADING, PRE-CLEARANCE, REPORTING AND OTHER COMPLIANCE PROCEDURES

A. Trading Through CSAM. No Advisory Person shall purchase or sell securities
for an account in which he or she has Beneficial Ownership other than through
the CSAM trading desk persons designated by a Designated Supervisory Person,
unless express prior written approval is granted by a Designated Supervisory
Person.

B. Preclearance. Except as provided in Section IV, before any Advisory Person
purchases or sells any security for any account in which he or she has
Beneficial Ownership, preclearance shall be obtained in writing from a
Designated Supervisory Person (attached as Attachment BC is a form to request
such approval). If clearance is given for a purchase or sale and the
transaction is not effected on that Business Day, a new preclearance request
must be made.

<PAGE> 8

C. Reporting.

1. Initial Certification. Within 10 days after the commencement of his or her
employment with CSAM or his or her affiliation with any Covered Fund, each
Access Person shall submit to a Designated Supervisory Person an initial
certification in the form of Attachment CD to certify that:

- - he or she has read and understood this Code of Ethics and recognizes
that he or she is subject to its requirements; and

- - he or she has disclosed or reported all personal securities holdings in
which he or she has any direct or indirect Beneficial Ownership and all
accounts in which any securities are held for his or her direct or
indirect benefit.

2. Annual Certification. In addition, each Access Person shall submit to a
Designated Supervisory Person an annual certification in the form of Attachment
DE to certify that:

- - he or she has read and understood this Code of Ethics and recognizes
that he or she is subject to its requirements;

- - he or she has complied with all requirements of this Code of Ethics;
and

- - he or she has disclosed or reported (a) all personal securities
transactions for the previous year and (b) all personal securities
holdings in which he or she has any direct or indirect Beneficial
Ownership and accounts in which any securities are held for his or her
direct or indirect benefit as of a date no more than 30 days before the
annual certification is submitted.

Access Persons may comply with the initial and annual reporting requirements by
submitting account statements and/or Attachment E to a Designated Supervisory
Person within the prescribed periods. An Access Persons who is not an Advisory
Persons is not required to submit

<PAGE> 9

initial or annual certifications, unless such Access Person is an officer of a
Covered Fund.

Each Advisory Person shall annually disclose all directorships and outside
business activities (attached as Attachment F is a form for such disclosure).

3. Quarterly Reporting. Each All Advisory Persons and each Access Person who is
an officer of a Covered Fund shall also supply a Designated Supervisory Person,
on a timely basis, with duplicate copies of confirmations of all personal
securities transactions and copies of periodic statements for all securities
accounts, including confirmations and statements for transactions and accounts
described in Section IV(B) above (exempt from prohibitions and preclearance).
This information must be supplied at least once per calendar quarter, within 10
days after the end of the calendar quarter.

Each Access Persons who is neither an Advisory Persons nor an officer of a
Covered Fund is required to report a transaction only if he or she, at the time
of that transaction, knew (or in the ordinary course of fulfilling official
duties with a Covered Fund should have known) that during the 15-day period
immediately before or after the date of the transaction the security such
person purchased or sold was purchased or sold by the Covered Fund or was being
considered for purchase or sale by the Covered Fund.

VI. COMPLIANCE MONITORING AND SUPERVISORY REVIEW

A Designated Supervisory Person will periodically review reports from the CSAM
trading desk (or, if applicable, confirmations from brokers) to assure that all
transactions effected by Access Persons for accounts in which they have
Beneficial Ownership are in compliance with this Code and Rule 17j-1 under the
1940 Act.

Material violations of this Code and any sanctions imposed shall be reported
not less frequently than quarterly to the board of directors of each relevant
Covered Fund and to the senior management of CSAM. At least annually, each
Covered Company shall prepare a written report to the board of
directors/trustees of each Covered Fund, and to the senior management of CSAM,
that:

<PAGE> 10

- - describes issues that have arisen under the Code since the last report,
including, but not limited to, material violations of the Code or
procedures that implement the Code and any sanctions imposed in response
to those violations; and

- - certifies that each Covered Company has adopted procedures reasonably
necessary to prevent Access Persons from violating the Code.

Material changes to this Code of Ethics must be approved by the Board of
Directors of each Covered Fund no later than six months after the change is
adopted. That approval must be based on a determination that the changes are
reasonably necessary to prevent Access Persons from engaging in any conduct
prohibited by the Code and Rule 17j-1 under the 1940 Act. Board approval must
include a separate vote of a majority of the independent directors.

VII. SANCTIONS

Upon discovering that an Access Person has not complied with the requirements
of this Code, the senior management of the relevant Covered Company may impose
on that person whatever sanctions are deemed appropriate, including censure;
fine; reversal of transactions and disgorgement of profits; suspension; or
termination of employment.

VIII. CONFIDENTIALITY

All information obtained from any Access Person under this Code shall be kept
in strict confidence, except that reports of transactions will be made
available to the Securities and Exchange Commission or any other regulatory or
self-regulatory organization to the extent required by law or regulation.

IX. FURTHER INFORMATION

The Designated Supervisory Persons are Hal Liebes and James W. Bernaiche or
their designees in CSAM's legal and compliance department. Any questions
regarding the Code of Ethics should be directed to a Designated Supervisory
Person.

Dated: March 1, 2000

<PAGE> 11

EXHIBIT 1

CREDIT SUISSE ASSET MANAGEMENT, LLC
WARBURG PINCUS FUNDS
CODE OF ETHICS

DEFINITION OF BENEFICIAL OWNERSHIP

The term "Beneficial Ownership" as used in the attached Code of Ethics is to be
interpreted by reference to Rule 16a-1(a)(2) under the Securities Exchange Act
of 1934 ("Rule"). Under the Rule, a person is generally deemed to have
Beneficial Ownership of securities if the person (directly or indirectly),
through any contract, arrangement, understanding, relationship or otherwise, has
or shares a direct or indirect pecuniary interest in the securities.

The term "pecuniary interest" is generally defined in the Rule to mean the
opportunity (directly or indirectly) to profit or share in any profit derived
from a transaction in the securities. A person is deemed to have an "indirect
pecuniary interest" within the meaning of the Rule:

- in any securities held by members of the person's immediate family
sharing the same household; the term "immediate family" includes any
child, stepchild, grandchild, parent, stepparent, grandparent, spouse,
sibling, mother-in-law, father-in-law, son-in-law, daughter-in-law,
brother-in-law or sister-in-law, as well as adoptive relationships;

- - a general partner's proportionate interest in the portfolio securities
held by a general or limited partnership;

- - a person's right to dividends that is separated or separable from the
underlying securities;

- - a person's interest in certain trusts; and
<PAGE> 12

- - a person's right to acquire equity securities through the exercise or
conversion of any derivative security, whether or not presently
exercisable.(1)

For purposes of the Rule, a person who is a shareholder of a corporation or
similar entity is not deemed to have a pecuniary interest in portfolio
securities held by the corporation or entity, so long as the shareholder is not
a controlling shareholder of the corporation or the entity and does not have or
share investment control over the corporation's or the entity's portfolio. The
term "control" means the power to exercise a controlling influence over
management or policies, unless the power is solely the result of an official
position with the company.

- --------
(1) The term "derivative security" is defined as any option, warrant,
convertible security, stock appreciation right of similar right
with an exercise or conversion privilege at price related to an
equity security (or similar securities) with a value derived from
the value of an equity security.

<PAGE> 13

ATTACHMENT A

Credit Suisse Asset Management, LLC
Warburg Pincus Funds/CSAM Closed-End Funds
Code of Ethics -- Special Approval Form

1. The following is a private placement of securities or other investment
requiring special approval in which I want to acquire or dispose of Beneficial
Ownership:

<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------
Name of Date to Amount Record Purchase How
- ------- ------- ------ ------ -------- ---
Private be to be Owner Price Acquired
- ------- -- ----- ----- ----- --------
Security Acquired Held (Broker/
- -------- -------- ---- --------
or Other Issuer)
- -------- -------
Investment
- ----------
- -----------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>

- -----------------------------------------------------------------------------------------

- -----------------------------------------------------------------------------------------
</TABLE>

Would this investment opportunity be appropriate for a CSAM client?

Yes No
- --- ---

2. I want to engage in the following outside business activity:

-------------------------------------------------------

3. I want special approval to place personal securities trades other than
through the CSAM trading desk (please describe):

-------------------------------------------------------

<PAGE> 14

I certify, as applicable, that I (a) am not aware of any non-public information
about the issuer, (b) have made all disclosures required by the Code of Ethics
and (c) will comply with all reporting requirements of the Code.

- ------------------- ------------------
Signature Date

- --------------------------------
Print Name

Approved
- ---

Not Approved
- ---

- --------------------------- -------------------------
Designated Supervisory Person Date

<PAGE> 15

ATTACHMENT B

Credit Suisse Asset Management, LLC
Warburg Pincus Funds/CSAM Closed-End Funds
Code of Ethics -- Personal Trading Pre-Clearance Form

This form should be filled out completely to expedite approval.

1. Security:

---------------------------------------

Ticker:

---------------------------------------

Purchase Sale
---- ----

2. Number of shares/bonds/units/contracts:

--------------

3. Account Name/Shortname:

---------------------------

4. Brokerage Firm and Account Number:

--------------------

5. Why do you want to purchase or sell? Is this an opportunity
appropriate for CSAM clients?

------------------------------------------------------

6. Are you aware of a CSAM Advisory Person who is buying or selling or who
plans to buy or sell this security for his or her personal accounts or CSAM
clients?

Yes No
--- ---

If yes, who?

------------------------------------------------------

7. If the amount is less than 500 shares, is the issuer market
capitalization greater than $2.5 billion?

<PAGE> 16
Yes No
---- -----

I certify that I (a) am not aware of any non-public information about the
issuer, (b) have made all disclosures required by the Code of Ethics and this
trade otherwise complies with the Code, including the prohibition on
investments in initial public offerings, and (c) will comply with all reporting
requirements of the Code.

- ---------------------------------- ---------------
Signature of Advisory Person Date

- ----------------------------------
Print Name

Approved
- ---

Not Approved
- ---

- ---------------------------------- -----------------
Designated Supervisory Person Date - Valid
this Business Day only.

<PAGE> 17

ATTACHMENT C

CREDIT SUISSE ASSET MANAGEMENT, LLC
WARBURG PINCUS FUNDS/CSAM CLOSED-END FUNDS
CODE OF ETHICS

INITIAL CERTIFICATION

I certify that I:

- - have read and understood the Code of Ethics for Credit Suisse Asset
Management, LLC, and the Warburg Pincus Funds and the CSAM Closed-End
Funds dated February 3, 2000 and recognize that I am subject to its
requirements; and

- - have disclosed or reported all ersonal securities holdings in which I
had any direct or indirect Beneficial Ownership and accounts in which any
securities were held for my direct or indirect benefit as of the date I
commenced employment with CSAM or the date I became affiliated with a
Covered Fund.

- -------------------------------- -------------------
Signature of Access Person Date

- --------------------------------
Print Name

<PAGE> 18

ATTACHMENT D

CREDIT SUISSE ASSET MANAGEMENT, LLC
WARBURG PINCUS FUNDS/CSAM CLOSED-END FUNDS

CODE OF ETHICS

ANNUAL CERTIFICATION

I certify that I:

- - have complied with all requirements of the Code of Ethics and Policy and
Procedures Designed to Detect and Prevent Insider Trading in effect during
the year ended December 31, 1999; and

- - have disclosed or reported all personal securities transactions for the
year ended December 31, 1999 and all personal securities holdings in which
I had any direct or indirect Beneficial Ownership and all accounts in
which any securities were held for my direct or indirect benefit as of
December 31, 1999.

- -------------------------------- -------------------
Signature of Access Person Date

- --------------------------------
Print Name

<PAGE> 19

ATTACHMENT E

Credit Suisse Asset Management, LLC
Warburg Pincus Funds/CSAM Closed-End Funds
Code of Ethics - Personal Securities Account
Declaration

ALL ACCESS PERSONS MUST COMPLETE EACH APPLICABLE ITEM (1, 2, 3 OR 4) AND SIGN
BELOW.

1. The following is a list of securities/commodities accounts in which I have
Beneficial Ownership:

Broker/Dealer Account Title and Number
- -------------------------------------------------------------------------------

- -------------------------------------------------------------------------------

2. The following is a list of securities/commodities accounts in which I had
Beneficial Ownership that have been opened or closed in the past year:

Broker/Dealer Account Title and Number
- -------------------------------------------------------------------------------

- -------------------------------------------------------------------------------

3. The following is a list of any other securities or other investment holdings
in which I have Beneficial Ownership (for securities held in accounts other
than those disclosed in response to items 1 and 2):

- -------------------------------------------------------------------------------------------------
Name of Date Amount Record Purchase How
Private Acquired Held Owner Price Acquired
Security (Broker/
or Other Issuer)
Investment
- -------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>

- -------------------------------------------------------------------------------------------------
</TABLE>

<PAGE> 20

- -------------------------------------------------------------------------------------------------

- -------------------------------------------------------------------------------------------------
</TABLE>

4. I do not have Beneficial Ownership in any securities/commodities accounts or
otherwise have Beneficial Ownership of any securities or other instruments
subject to the Code of Ethics.
(Please initial.)

- -------------
Initials

I declare that the information given above is true and accurate:

- -------------------------------- --------------------
Signature of Access Person Date

- -------------------------------
Print Name

<PAGE> 21

ATTACHMENT F

CREDIT SUISSE ASSET MANAGEMENT, LLC
WARBURG PINCUS FUNDS/CSAM CLOSED-END FUNDS
CODE OF ETHICS

OUTSIDE BUSINESS ACTIVITIES

Outside business activities include, but are not limited to, the following:

- - self-employment;

- - receiving compensation from another person or company;

- - serving as an officer, director, partner, or consultant of another
business organization (including a family owned company); and

- - becoming a general or limited partner in a partnership or owning any
stock in a business, unless the stock is publicly traded and no control
relationship exists.

Outside business activities include serving with a governmental (federal, state
or local) or charitable organization whether or not for compensation.

All Advisory Persons must complete at least one choice (1 or 2) and sign below.

1. The following are my outside business activities:

Approved By
Designated
Outside Business Description of Supervisory Person
Activity Activity (Yes/No)

- -------------------------------------------------------------------------------------
<S> <C> <C>

- -------------------------------------------------------------------------------------

- -------------------------------------------------------------------------------------
</TABLE>

<PAGE> 22

2. I am not involved in any outside business activities. (Please initial)

------------
Initials

I declare that the information given above is true and accurate:

- -------------------------------- -------------------
Signature of Advisory Person Date

- --------------------------------
Print Name