<PAGE>
As filed with the Securities and Exchange Commission
on December 21, 2000
Securities Act File No.
________________________________________________________________________________
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM N-14
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 [X]
Pre-Effective Amendment No. [_] Post-Effective Amendment No. [_]
GLOBAL/INTERNATIONAL FUND, INC.
(Exact Name of Registrant as Specified in Charter)
345 Park Avenue, New York, New York 10154
(Address of Principal Executive Offices) (Zip Code)
John Millette
Scudder Kemper Investments, Inc.
Two International Place
Boston, MA 02110-4103
(Name and Address of Agent for Service)
(617) 295-1000
(Registrant's Area Code and Telephone Number)
with copies to:
Caroline Pearson, Esq. Joseph R. Fleming, Esq.
Scudder Kemper Investments, Inc. Dechert
Two International Place Ten Post Office Square - South
Boston, MA 02110-4103 Boston, MA 02109-4603
Approximate Date of Proposed Public Offering:
As soon as practicable after this Registration Statement is declared effective.
Title of Securities Being Registered:
Shares of Capital Stock ($.01 par value)
of Scudder Global Fund, a series of the Registrant
________________________________________________________________________________
It is proposed that this filing will become effective on January 20, 2001
pursuant to Rule 488 under the Securities Act of 1933.
________________________________________________________________________________
No filing fee is required because the Registrant has previously registered an
indefinite number of its shares under the Securities Act of 1933, as amended,
pursuant to Rule 24f-2 under the Investment Company Act of 1940, as amended.
<PAGE>
PART A
INFORMATION REQUIRED IN THE PROXY STATEMENT/PROSPECTUS
<PAGE>
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS OF
KEMPER GLOBAL BLUE CHIP FUND
Please take notice that a Special Meeting of Shareholders (the "Meeting")
of Kemper Global Blue Chip Fund (the "Fund"), a series of Kemper
Global/International Series, Inc. (the "Corporation"), will be held at the
offices of Scudder Kemper Investments, Inc., 13th Floor, Two International
Place, Boston, MA 02110-4103, on May 24, 2001, at 4:00 p.m., Eastern time, for
the following purposes:
Proposal 1: To elect Directors of the Corporation.
Proposal 2: To approve an Agreement and Plan of Reorganization for the
Fund (the "Plan"). Under the Plan, (i) all or substantially
all of the assets and all of the liabilities of the Fund
would be transferred to Scudder Global Fund, (ii) each
shareholder of the Fund would receive shares of Scudder
Global Fund of a corresponding class to those held by the
shareholder in the Fund in an amount equal to the value of
their holdings in the Fund, and (iii) the Fund would then be
terminated.
Proposal 3: To ratify the selection of Ernst & Young LLP as the
independent auditors for the Fund for the Fund's current
fiscal year.
The persons named as proxies will vote in their discretion on any other
business that may properly come before the Meeting or any adjournments or
postponements thereof.
Holders of record of shares of the Fund at the close of business on March
5, 2001 are entitled to vote at the Meeting and at any adjournments or
postponements thereof.
In the event that the necessary quorum to transact business or the vote
required to approve any Proposal is not obtained at the Meeting, the persons
named as proxies may propose one or more adjournments of the Meeting in
accordance with applicable law to permit further solicitation of proxies. Any
such adjournment as to a matter will require the affirmative vote of the holders
of a majority of the Corporation's (for a corporation-wide vote) or the Fund's
(for a Fund-wide vote) shares present in person or by proxy at the Meeting. The
persons named as proxies will vote FOR any such adjournment those proxies which
they are entitled to vote in favor of that Proposal and will vote AGAINST any
such adjournment those proxies to be voted against that Proposal.
By Order of the Board,
/s/ Philip J. Collora
Philip J. Collora
Secretary
March 6, 2001
IMPORTANT -- WE URGE YOU TO SIGN AND DATE THE ENCLOSED PROXY CARD(S) AND RETURN
IT IN THE ENCLOSED ENVELOPE WHICH REQUIRES NO POSTAGE (OR TO TAKE ADVANTAGE OF
THE ELECTRONIC OR TELEPHONIC VOTING PROCEDURES DESCRIBED ON THE PROXY CARD(S)).
YOUR PROMPT RETURN OF THE ENCLOSED PROXY CARD(S) (OR YOUR VOTING BY OTHER
AVAILABLE MEANS) MAY SAVE THE NECESSITY AND EXPENSE OF FURTHER SOLICITATIONS.
IF YOU WISH TO ATTEND THE MEETING AND VOTE YOUR SHARES IN PERSON AT THAT TIME,
YOU WILL STILL BE ABLE TO DO SO.
<PAGE>
TABLE OF CONTENTS
<TABLE>
<S> <C>
INTRODUCTION................................................................. __
PROPOSAL 1: ELECTION OF DIRECTORS........................................... __
PROPOSAL 2: APPROVAL OF AGREEMENT AND PLAN OF REORGANIZATION................ __
SYNOPSIS........................................................ __
PRINCIPAL RISK FACTORS.......................................... __
THE PROPOSED TRANSACTION........................................ __
PROPOSAL 3: RATIFICATION OR REJECTION OF THE SELECTION OF INDEPENDENT
AUDITORS........................................................ __
ADDITIONAL INFORMATION....................................................... __
</TABLE>
<PAGE>
PROXY STATEMENT/PROSPECTUS
March [ ], 2001
Relating to the acquisition of the assets of
KEMPER GLOBAL BLUE CHIP FUND,
a separate series of
KEMPER GLOBAL/INTERNATIONAL SERIES, INC. (the "Acquired Corporation")
222 South Riverside Plaza
Chicago, Illinois 60606
(800) [ ]
--------------------
by and in exchange for shares of capital stock of
SCUDDER GLOBAL FUND,
a separate series of
GLOBAL/INTERNATIONAL FUND, INC. (the "Acquiring Corporation")
345 Park Avenue
New York, New York 10154
(800) [ ]
--------------------
INTRODUCTION
This Proxy Statement/Prospectus is being furnished to shareholders of
Kemper Global Blue Chip Fund (the "Fund") in connection with three proposals.
Proposal 1 describes the election of Directors and Proposal 3 proposes the
ratification of the selection of the Fund's auditors.
In Proposal 2, shareholders are asked to vote on an Agreement and Plan of
Reorganization (the "Plan") pursuant to which all or substantially all of the
assets of the Fund would be acquired by Scudder Global Fund, a fund with similar
investment characteristics and managed by the same investment manager as the
Fund, in exchange for shares of capital stock of Scudder Global Fund and the
assumption by Scudder Global Fund of all of the liabilities of the Fund, as
described more fully below (the "Reorganization"). Shares of Scudder Global Fund
received would then be distributed to the shareholders of the Fund in complete
liquidation of the Fund. As a result of the Reorganization, shareholders of the
Fund will become shareholders of Scudder Global Fund and will receive shares of
Scudder Global Fund in an amount equal to the value of their holdings in the
Fund as of the close of business on the business day preceding the closing of
the Reorganization (the "Valuation Date"). The closing of the Reorganization
(the "Closing") is contingent upon shareholder approval of the Plan. A copy of
the Plan is attached as Exhibit A. The Reorganization is expected to occur on or
about June 18, 2001.
THE SECURITIES AND EXCHANGE COMMISSION HAS NOT APPROVED OR DISAPPROVED THESE
SECURITIES NOR PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROXY
STATEMENT/PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
Proposals 1 and 2 arise out of a restructuring program proposed by Scudder
Kemper Investments, Inc. ("Scudder Kemper" or the "Investment Manager"), the
investment manager of both the Fund and Scudder Global Fund, described in more
detail below. The restructuring program is designed to respond to changing
industry conditions and investor needs. Scudder Kemper seeks to consolidate its
fund line-up and offer all of the open-end funds it advises under the "Scudder"
name. In addition, Scudder Kemper anticipates changing its name to "Zurich
Scudder Investments, Inc." Scudder Kemper believes that the
-1-
<PAGE>
combination of its open-end, directly-distributed funds (the "Scudder Funds")
with the funds in the Kemper Family of Funds (the "Kemper Funds") will permit it
to streamline its administrative infrastructure and focus its distribution
efforts. The restructuring program will not result in any reduction in the
services currently offered to Kemper Funds shareholders.
In the descriptions of the Proposals below, the word "fund" is sometimes
used to mean an investment company or series thereof in general, and not the
Fund whose proxy statement this is. In addition, for simplicity, actions are
described in this Proxy Statement/Prospectus as being taken by either the Fund
or Scudder Global Fund (which are collectively referred to as the "Funds" and
each referred to as a "Fund"), although all actions are actually taken either by
the Acquired Corporation or the Acquiring Corporation (together with the
Acquired Corporation, the "Corporations"), on behalf of the applicable Fund.
This Proxy Statement/Prospectus sets forth concisely the information about
Scudder Global Fund that a prospective investor should know before investing and
should be retained for future reference. For a more detailed discussion of the
investment objective, policies, restrictions and risks of Scudder Global Fund,
see Scudder Global Fund's prospectus dated December 29, 2000, as supplemented
from time to time, which is included in the materials you received with this
document and incorporated herein by reference (meaning that it is legally part
of this document). For a more detailed discussion of the investment objective,
policies, restrictions and risks of the Fund, see the Fund's prospectus dated
March 1, 2001, as supplemented from time to time, which is also incorporated
herein by reference and a copy of which may be obtained upon request and without
charge by calling or writing the Fund at the telephone number or address listed
above.
Also incorporated herein by reference is Scudder Global Fund's statement of
additional information dated December 29, 2000, as supplemented from time to
time, which may be obtained upon request and without charge by calling or
writing Scudder Global Fund at the telephone number or address listed above. A
Statement of Additional Information, dated March [_], 2001, containing
additional information about the Reorganization has been filed with the
Securities and Exchange Commission (the "SEC" or the "Commission") and is
incorporated by reference into this Proxy Statement/Prospectus. A copy of this
Statement of Additional Information is available upon request and without charge
by calling or writing Scudder Global Fund at the telephone number or address
listed above. Shareholder inquiries regarding Scudder Global Fund may be made
by calling (800) [ ] and shareholder inquiries regarding the Fund may
be made by calling (800) [ ]. The information contained in this
document concerning each Fund has been provided by, and is included herein in
reliance upon, that Fund.
Scudder Global Fund and the Fund are diversified series of shares of
capital stock of the Acquiring Corporation and the Acquired Corporation,
respectively, which are open-end management investment companies organized as
Maryland corporations.
The Board of Directors that oversees the Fund is soliciting proxies from
shareholders of the Fund for the Special Meeting of Shareholders to be held on
May 24, 2001, at Scudder Kemper's offices, 13th Floor, Two International Place,
Boston, MA 02110-4103 at 4:00 p.m. (Eastern time), and at any and all
adjournments or postponements thereof (the "Meeting"). This Proxy
Statement/Prospectus, the Notice of Special Meeting and the proxy card(s) are
first being mailed to shareholders on or about March 6, 2001 or as soon as
practicable thereafter.
The Board of Directors unanimously recommends that shareholders vote FOR
the nominees listed in Proposal 1, and FOR Proposals 2 and 3.
-2-
<PAGE>
PROPOSAL 1: ELECTION OF DIRECTORS
At the Meeting, shareholders will be asked to elect eleven individuals to
constitute the Board of Directors of the Acquired Corporation. Shareholders are
being asked to elect these individuals to the Board of Directors in case the
Plan, as described under Proposal 2, is not approved by shareholders. However,
if the Plan is approved, the current Board of Directors of the Acquiring
Corporation will oversee the operations of the combined Fund (see "Synopsis -
Other Differences Between the Funds" under Proposal 2).
As discussed further below, Scudder Kemper commenced an initiative to
restructure and streamline the management and operations of the funds it
advises. In connection with that initiative, the Independent Directors (as
defined below) of the two separate boards of Kemper Funds proposed to
consolidate into a single board. The eleven individuals who have been nominated
for election as Directors of the Fund were nominated after careful consideration
by the present Board of Directors. The nominees are listed below. Three of the
nominees are currently Directors of the Acquired Corporation and seven of the
nominees are currently trustees or directors of other Kemper Funds. One of the
nominees, although not currently a trustee or director of any Kemper Fund, is a
senior executive officer of Scudder Kemper. These eleven nominees are also
being nominated for election as trustees or directors of most of the other
Kemper Funds. The proposed slate of nominees reflects an effort to consolidate
the two separate boards who have historically supervised different Kemper Funds.
The proposed consolidation is expected to provide administrative efficiencies to
both the Funds and Scudder Kemper.
The persons named as proxies on the enclosed proxy card(s) will vote for
the election of the nominees named below unless authority to vote for any or all
of the nominees is withheld in the proxy. Each Director so elected will serve
as a Director commencing on July 1, 2001 and until the next meeting of
shareholders, if any, called for the purpose of electing Directors and until the
election and qualification of a successor or until such Director sooner dies,
resigns or is removed as provided in the governing documents of the Acquired
Corporation. Each of the nominees has indicated that he or she is willing to
serve as a Director. If any or all of the nominees should become unavailable
for election due to events not now known or anticipated, the persons named as
proxies will vote for such other nominee or nominees as the current Directors
may recommend. The following tables present information about the nominees and
the Directors not standing for re-election. Each nominee's or Director's date
of birth is in parentheses after his or her name. Unless otherwise noted, (i)
each of the nominees and Directors has engaged in the principal occupation(s)
noted in the following tables for at least the most recent five years, although
not necessarily in the same capacity, and (ii) the address of each nominee is
c/o Scudder Kemper Investments, Inc., 222 South Riverside Plaza, Chicago,
Illinois 60606.
Nominees for Election as Directors:
<TABLE>
<CAPTION>
-----------------------------------------------------------------------------------
Year First
Name (Date of Birth), Principal Occupation and Affiliations Became a
Board
Member
-----------------------------------------------------------------------------------
<S> <C>
John W. Ballantine (2/16/46),/(1)/ Retired; formerly, First Nominee
Chicago NBD Corporation/The First National Bank of
Chicago: 1996-1998 Executive Vice President and Chief Risk
Management Officer; 1995-1996 Executive Vice President and
Head of International Banking.
-----------------------------------------------------------------------------------
</TABLE>
-3-
<PAGE>
<TABLE>
<CAPTION>
-----------------------------------------------------------------------------------
Year First
Name (Date of Birth), Principal Occupation and Affiliations Became a
Board
Member
-----------------------------------------------------------------------------------
<S> <C>
Lewis A. Burnham (1/8/33),/(1)/ Retired; formerly, Partner, Nominee
Business Resources Group; formerly, Executive Vice
President, Anchor Glass Container Corporation.
-----------------------------------------------------------------------------------
Linda C. Coughlin (1/1/52),*/(2)/ Managing Director, Nominee
Scudder Kemper.
-----------------------------------------------------------------------------------
Donald L. Dunaway (3/8/37),/(1)/ Retired; formerly, Nominee
Executive Vice President, A.O. Smith Corporation
(diversified manufacturer).
-----------------------------------------------------------------------------------
James R. Edgar (7/22/46),/(3)/ Distinguished Fellow,
University of Illinois Institute of Government and Public 1999
Affairs; Director, Kemper Insurance Companies (not
affiliated with the Kemper Funds); formerly, Governor,
State of Illinois.
-----------------------------------------------------------------------------------
William F. Glavin (8/30/58),* Managing Director, Scudder Nominee
Kemper.
-----------------------------------------------------------------------------------
Robert B. Hoffman (12/11/36),/(1)/ Retired; formerly, Nominee
Chairman, Harnischfeger Industries, Inc. (machinery for
the mining and paper industries); formerly, Vice Chairman
and Chief Financial Officer, Monsanto Company
(agricultural, pharmaceutical and nutritional/food
products); formerly, Vice President, Head of International
Operations, FMC Corporation (manufacturer of machinery and
chemicals); Director, Harnischfeger Industries, Inc.
-----------------------------------------------------------------------------------
Shirley D. Peterson (9/3/41),/(1)/ Retired; formerly, Nominee
President, Hood College; formerly, Partner, Steptoe &
Johnson (attorneys); prior thereto, Commissioner, Internal
Revenue Service; prior thereto, Assistant Attorney General
(Tax), U.S. Department of Justice; Director, Bethlehem
Steel Corp.
-----------------------------------------------------------------------------------
Fred B. Renwick (2/1/30),/(3)/ Professor of Finance, New
York University, Stern School of Business; Director, the
Wartburg Foundation; Chairman, Investment Committee of
Morehouse College Board of Trustees; Director, American 1998
Bible Society Investment Committee; previously member of
the Investment Committee of Atlanta University Board of
Trustees; formerly Director of Board of Pensions
Evangelical Lutheran Church in America.
-----------------------------------------------------------------------------------
</TABLE>
-4-
<PAGE>
<TABLE>
<CAPTION>
-----------------------------------------------------------------------------------
Year First
Name (Date of Birth), Principal Occupation and Affiliations Became a
Board
Member
-----------------------------------------------------------------------------------
<S> <C>
William P. Sommers (7/22/33),/(1)/ Consultant and Director, Nominee
SRI Consulting; prior thereto, President and Chief
Executive Officer, SRI International (research and
development); prior thereto, Executive Vice President,
Iameter (medical information and educational service
provider); prior thereto, Senior Vice President and
Director, Booz, Allen & Hamilton Inc. (management
consulting firm); Director, PSI Inc., Evergreen Solar,
Inc. and Litton Industries.
-----------------------------------------------------------------------------------
John G. Weithers (8/8/33),/(3)/ Formerly, Chairman of the
Board and Chief Executive Officer, Chicago Stock Exchange;
Director, Federal Life Insurance Company; President of the 1998
Members of the Corporation and Trustee, DePaul University.
-----------------------------------------------------------------------------------
</TABLE>
* Interested person of the Acquired Corporation, as defined in the
Investment Company Act of 1940, as amended (the "1940 Act").
/(1)/ Messrs. Ballantine, Burnham, Dunaway, Hoffman, Sommers and Ms. Peterson
serve as board members of 26 investment companies, with 45 portfolios
managed by Scudder Kemper.
/(2)/ Ms. Coughlin serves as a board member of 52 investment companies with 97
portfolios managed by Scudder Kemper.
/(3)/ Messrs. Edgar, Renwick and Weithers serve as board members of 16
investment companies with 58 portfolios managed by Scudder Kemper.
Directors Not Standing for Re-Election:
<TABLE>
<CAPTION>
--------------------------------------------------------------------------------------------------
Present Office with the Acquired Corporation;
Principal Occupation or Employment
Name (Date of Birth) and Directorships
--------------------- -----------------
--------------------------------------------------------------------------------------------------
<S> <C>
James E. Akins (10/15/26) Director; Consultant on International,
Political and Economic Affairs; formerly, a
career U.S. Foreign Service Officer, Energy
Adviser for the White House and U.S.
Ambassador to Saudi Arabia, 1973-1976.
--------------------------------------------------------------------------------------------------
Arthur Gottschalk (2/13/25) Director; Retired; formerly, President,
Illinois Manufacturers Association; Trustee,
Illinois Masonic Medical Center; formerly,
Illinois State Senator; formerly, Vice
President, The Reuben H. Donnelley Corp.;
formerly, attorney.
---------------------------------------------------------------------------------------------------------
</TABLE>
-5-
<PAGE>
<TABLE>
<CAPTION>
--------------------------------------------------------------------------------------------------
Present Office with the Acquired Corporation;
Principal Occupation or Employment
Name (Date of Birth) and Directorships
--------------------- -----------------
--------------------------------------------------------------------------------------------------
<S> <C>
Frederick T. Kelsey (4/25/27) Director; Retired; formerly, Consultant to
Goldman, Sachs & Co.; formerly, President,
Treasurer and Trustee of Institutional Liquid
Assets and its affiliated mutual funds;
formerly, President and Trustee, Northern
Institutional Funds; formerly, President and
Trustee, Pilot Funds.
--------------------------------------------------------------------------------------------------
Kathryn L. Quirk (12/3/52)* Director and Vice President; Managing Director,
Scudder Kemper.
--------------------------------------------------------------------------------------------------
</TABLE>
* Interested person of the Acquired Corporation, as defined in the 1940 Act.
Appendix 1 lists the number of shares of each series of the Acquired
Corporation owned directly or beneficially by the Directors and by the nominees
for election.
Responsibilities of the Board of Directors -- Board and Committee Meetings
The primary responsibility of the Board is to represent the interests of
the shareholders of the Fund and to provide oversight of the management of the
Fund. The board that is proposed for election at this Meeting is comprised of
two individuals who are considered "interested" Directors, and nine individuals
who have no affiliation with Scudder Kemper and who are not considered
"interested" Directors (the "Independent Directors"). The SEC has recently
proposed a rule that would require a majority of the board members of a fund to
be "independent" if the fund were to take advantage of certain exemptive rules
under the 1940 Act. If the proposed Board of Directors is approved by
shareholders, more than 75% will be Independent Directors. The Independent
Directors have been selected and nominated solely by the current Independent
Directors of the Acquired Corporation.
The Directors meet multiple times during the year to review the investment
performance of the Fund and other operational matters, including policies and
procedures designed to assure compliance with regulatory and other requirements.
Furthermore, the Independent Directors review the fees paid to the Investment
Manager and its affiliates for investment advisory services and other
administrative and shareholder services. The Directors have adopted specific
policies and guidelines that, among other things, seek to further enhance the
effectiveness of the Independent Directors in performing their duties. Many of
these are similar to those suggested in the Investment Company Institute's 1999
Report of the Advisory Group on Best Practices for Fund Directors (the "Advisory
Group Report"). For example, the Independent Directors select independent legal
counsel to work with them in reviewing fees, advisory and other contracts and
overseeing fund matters, and regularly meet privately with their counsel.
Currently, the Board of Directors has an Audit and Governance Committee,
the responsibilities of which are described below. In addition, the Board has a
Valuation Committee. During calendar year 2000, the Board of Directors met
eight times. Each then current Director attended 75% or more of the respective
meetings of the Board and the committees (if a member thereof) held during
calendar year 2000.
-6-
<PAGE>
Audit and Governance Committee
The Audit and Governance Committee makes recommendations regarding the
selection of independent auditors for the Fund, confers with the independent
auditors regarding the Fund's financial statements, the results of audits and
related matters, and performs such other tasks as the full Board of Directors
deems necessary or appropriate. As suggested by the Advisory Group Report, the
Audit and Governance Committee is comprised of only Independent Directors,
receives annual representations from the auditors as to their independence, and
has a written charter that delineates the committee's duties and powers. In
addition, the committee seeks and reviews candidates for consideration as
nominees for membership on the Board and oversees the administration of the
Acquired Corporation's Governance Procedures and Guidelines. Shareholders
wishing to submit the name of a candidate for consideration by the committee
should submit their recommendation(s) to the Secretary of the Acquired
Corporation. Currently, the members of the committee are Messrs. Akins, Edgar,
Gottschalk, Kelsey, Renwick and Weithers. The committee held four meetings
during calendar year 2000.
Officers
The following persons are officers of the Acquired Corporation:
<TABLE>
<CAPTION>
-----------------------------------------------------------------------------------------------------------
Present Office with the Acquired
Corporation; Principal Occupation
Name (Date of Birth) or Employment Year First Became an Officer/1/
-------------------- ------------- -------------------------------
-----------------------------------------------------------------------------------------------------------
<S> <C> <C>
Mark S. Casady (9/21/60) President; Managing Director,
Scudder Kemper; formerly,
Institutional Sales Manager of an 1998
unaffiliated mutual fund
distributor.
-----------------------------------------------------------------------------------------------------------
Thomas W. Littauer (4/26/55) Chairman and Vice President;
Managing Director, Scudder
Kemper; Head of Broker Dealer
Division of an unaffiliated
investment management firm during 1998
1997; prior thereto, President of
Client Management Services of an
unaffiliated investment
management firm from 1991 to 1996.
-----------------------------------------------------------------------------------------------------------
Philip J. Collora (11/15/45) Vice President and Secretary;
Attorney, Senior Vice President, 1998
Scudder Kemper.
-----------------------------------------------------------------------------------------------------------
Kathryn L. Quirk (12/3/52) Vice President; Managing
Director, Scudder Kemper. 1998
-----------------------------------------------------------------------------------------------------------
William F. Truscott (9/14/60) Vice President; Managing
Director, Scudder Kemper. 2000
-----------------------------------------------------------------------------------------------------------
Joyce E. Cornell (3/26/44) Vice President; Managing Director,
Scudder Kemper. 1998
-----------------------------------------------------------------------------------------------------------
Joan R. Gregory (8/4/45) Vice President; Managing Director,
Scudder Kemper. 1999
-----------------------------------------------------------------------------------------------------------
</TABLE>
-7-
<PAGE>
<TABLE>
<CAPTION>
-----------------------------------------------------------------------------------------------------------
Present Office with the Acquired
Corporation; Principal Occupation
Name (Date of Birth) or Employment Year First Became an Officer/1/
-------------------- ------------- -------------------------------
-----------------------------------------------------------------------------------------------------------
<S> <C> <C>
Tara Kenney (10/7/60) Vice President; Senior Vice President,
Scudder Kemper. 1998
-----------------------------------------------------------------------------------------------------------
Linda J. Wondrack (9/12/64) Vice President; Senior Vice
President, Scudder Kemper. 1998
-----------------------------------------------------------------------------------------------------------
John R. Hebble (6/27/58) Treasurer; Senior Vice President,
Scudder Kemper. 1998
-----------------------------------------------------------------------------------------------------------
Maureen E. Kane (2/14/62) Assistant Secretary; Vice
President, Scudder Kemper;
formerly, Assistant Vice
President of an unaffiliated
investment management firm; prior 1998
thereto, Associate Staff Attorney
of an unaffiliated investment
management firm, and Associate,
Peabody & Arnold (law firm).
-----------------------------------------------------------------------------------------------------------
Caroline Pearson (4/1/62) Assistant Secretary; Senior Vice
President, Scudder Kemper;
formerly, Associate, Dechert 1998
Price & Rhoads (law firm) from
1989-1997.
-----------------------------------------------------------------------------------------------------------
Brenda Lyons (2/21/63) Assistant Treasurer; Senior Vice 1998
President, Scudder Kemper.
-----------------------------------------------------------------------------------------------------------
</TABLE>
/1/ The President, Treasurer and Secretary each holds office until the first
meeting of Directors in each calendar year and until his or her successor has
been duly elected and qualified, and all other officers hold office as the
Directors permit in accordance with the By-laws of the Acquired Corporation.
Compensation of Directors and Officers
The Fund pays the Independent Directors an annual retainer (paid in
quarterly installments) and an attendance fee, plus expenses, for each Board
meeting and committee meeting attended. As reflected below, the Directors
currently serve as board members of various other Kemper Funds. Scudder Kemper
supervises the Fund's investments, pays the compensation and expenses of its
personnel who serve as Directors and officers on behalf of the Fund and receives
a management fee for its services. Several of the officers and Directors are
also officers, directors, employees or stockholders of Scudder Kemper and
participate in the fees paid to that firm, although the Fund makes no direct
payments to them.
To facilitate the restructuring of the boards of the Kemper Funds, certain
Independent Directors agreed not to stand for re-election. Independent Directors
of the Fund are not entitled to benefits under any pension or retirement plan.
However, the Board of each Kemper Fund determined that, particularly given the
benefits that would accrue to the Kemper Funds from the restructuring of the
boards, it was appropriate to provide the four Independent Directors who were
not standing for re-election for various Kemper Funds a one-time benefit. The
cost of such benefit is being allocated among all the Kemper Funds, with Scudder
Kemper agreeing to bear one-half of the cost of such benefit, given that Scudder
Kemper also benefits from administrative efficiencies of a consolidated board.
Messrs. Akins, Gottschalk
-8-
<PAGE>
and Kelsey, Independent Directors of the Fund who are not standing for re-
election, will each receive a one-time benefit. The amount received by a
director on behalf of each fund for which he serves as a director ranges from
$478 to $6,124 for Mr. Akins; $159 to $2,035 for Mr. Gottschalk; and $797 to
$10,194 for Mr. Kelsey.
The following Compensation Table provides in tabular form the following
data:
Column (1) All Directors who receive compensation from the Acquired
Corporation.
Column (2) Aggregate compensation received by each Director from the Fund
during calendar year 2000.
Column (3) Total compensation received by each Director from funds advised
by Scudder Kemper (collectively, the "Fund Complex") during calendar year 2000.
Compensation Table
<TABLE>
<CAPTION>
--------------------------------------------------------------------------------------------------
Aggregate Compensation Total Compensation From
Name of Director from the Fund Fund Complex/(2)(3)/
---------------- ------------- ------------
--------------------------------------------------------------------------------------------------
<S> <C> <C>
James E. Akins
--------------------------------------------------------------------------------------------------
James R. Edgar
--------------------------------------------------------------------------------------------------
Arthur R. Gottschalk/(1)/
--------------------------------------------------------------------------------------------------
Frederick T. Kelsey
--------------------------------------------------------------------------------------------------
Fred B. Renwick
--------------------------------------------------------------------------------------------------
John G. Weithers
--------------------------------------------------------------------------------------------------
</TABLE>
/(1)/ Includes deferred fees. Pursuant to deferred compensation agreements with
the Fund, deferred amounts accrue interest monthly at a rate equal to the yield
of Zurich Money Funds - Zurich Money Market Fund. Total deferred fees (including
interest thereon) payable from the Fund to Mr. Gottschalk are $[ ].
/(2)/ Includes compensation for service on the boards of [ ] Kemper
trusts/corporations comprised of [ ] funds. Each Director currently serves on
the boards of [ ] Kemper trusts/corporations comprised of [ ] funds.
/(3)/ Aggregate compensation does not reflect amounts paid to the Directors for
special meetings in connection with the Scudder Kemper restructuring initiative.
Such amounts totaled $_______, $_______, $_______, $_______, $_______ and
$_______ for Messrs. Akins, Edgar, Gottschalk, Kelsey, Renwick and Weithers,
respectively.
The Board of Directors unanimously recommends
that the shareholders of the Fund vote FOR each nominee.
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<PAGE>
PROPOSAL 2: APPROVAL OF AGREEMENT
AND PLAN OF REORGANIZATION
I. SYNOPSIS
Introduction
The Board of Directors, including all of the Independent Directors,
approved the Plan at a meeting held on November 29, 2000. Subject to its
approval by the shareholders of the Fund, the Plan provides for (a) the transfer
of all or substantially all of the assets and all of the liabilities of the Fund
to Scudder Global Fund in exchange for Class A, Class B and Class C shares of
Scudder Global Fund; (b) the distribution of such shares to the shareholders of
the Fund in complete liquidation of the Fund; and (c) the termination of the
Fund. As a result of the Reorganization, each shareholder of the Fund will
become a shareholder of Scudder Global Fund, a fund with similar investment
characteristics and managed by the same investment manager as the Fund.
Immediately after the Reorganization, each shareholder of the Fund will hold
shares of the class of shares of Scudder Global Fund that correspond to the
class of shares of the Fund held by that shareholder on the Valuation Date,
having an aggregate net asset value equal to the aggregate net asset value of
such shareholder's shares of the Fund on the Valuation Date.
Scudder Kemper is the investment manager of both Funds. If the
Reorganization is completed, the Fund's shareholders will continue to enjoy all
of the same shareholder privileges as they currently enjoy, such as access to
professional service representatives, exchange privileges and automatic dividend
reinvestment. Services provided to the Class A, Class B and Class C shareholders
of Scudder Global Fund following the Reorganization will be identical to those
currently provided to shareholders of the corresponding class of the Fund. See
"Purchase, Redemption and Exchange Information."
Background of the Reorganization
The Reorganization is part of a broader restructuring program to respond to
changing industry conditions and investor needs. The mutual fund industry has
grown dramatically over the last ten years. During this period of rapid growth,
investment managers expanded the range of fund offerings that are available to
investors in an effort to meet the growing and changing needs and desires of an
increasingly large and dynamic group of investors. With this expansion has come
increased complexity and competition among mutual funds, as well as the
potential for increased confusion among investors. The group of funds advised by
Scudder Kemper has followed this pattern.
As a result, Scudder Kemper has sought ways to restructure and streamline
the management and operations of the funds it advises by consolidating all of
the retail mutual funds that it currently sponsors into a single product line
offered under the "Scudder" name. Scudder Kemper believes, and has advised the
boards, that further reducing the number of funds it advises and adding the
classes of shares currently offered on all Kemper Funds to the Scudder Funds
will benefit fund shareholders. Scudder Kemper has, therefore, proposed the
combination of many Scudder Funds and Kemper Funds that have similar or
compatible investment objectives and policies. Scudder Kemper believes that the
larger funds, along with the fewer number of funds, that result from these
combinations may help to enhance investment performance and increase efficiency
of operations. The restructuring program will not result in any changes in the
shareholder services currently offered to shareholders of the Kemper Funds.
Most of the Scudder Funds have recently adopted a new fee structure for
certain administrative services. Under this fee structure, in exchange for
payment by a fund of a single administrative fee rate, Scudder Kemper provides
or pays for substantially all services that the fund normally requires for its
operations, other than those provided under the fund's investment management
agreement and certain
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<PAGE>
other expenses. This administrative fee enables investors to determine with
greater certainty the expense level that a fund will experience, and, for the
term of the administration agreement, transfers substantially all of the risk of
increased costs to Scudder Kemper. Likewise, Scudder Kemper receives all of the
benefits of economies of scale from increases in asset size or decreased
operating expenses. Scudder Global Fund has implemented such an administrative
fee, as described in "Administrative Fee" below. As part of the restructuring
effort, Scudder Kemper has proposed extending this administrative fee structure
to those funds currently offered under the Kemper name.
The fund consolidations and the consolidation of the boards currently
overseeing the Kemper Funds (see Proposal 1 above) are expected to have a
positive impact on Scudder Kemper, as well. These changes are likely to result
in reduced costs (and the potential for increased profitability) for Scudder
Kemper in advising or servicing funds.
Reasons for the Proposed Reorganization; Board Approval
Since receiving Scudder Kemper's proposals on May 24, 2000, the Independent
Directors have conducted a thorough review of all aspects of the proposed
restructuring program. They have been assisted in this regard by their
independent counsel and by independent consultants with special expertise in
financial and mutual fund industry matters. In the course of discussions with
representatives of Scudder Kemper, the Independent Directors have requested, and
Scudder Kemper has accepted, numerous changes designed to protect and enhance
the interests of shareholders. See "The Proposed Transaction - Board Approval
of the Proposed Transaction" below.
In determining whether to recommend that the shareholders of the Fund
approve the Reorganization, the Board of Directors considered that:
. As part of Scudder Kemper's overall restructuring, the Fund would be
duplicative of another similar fund advised by Scudder Kemper in the
same distribution channel.
. At the current level of assets of the combined fund, the effective
advisory fee rate would be lower than that currently charged by the
Fund.
. The fixed fee rate under the Administration Agreement is expected to
be less than the estimated current applicable operating expenses the
Fund would otherwise pay.
. It is a condition of the Reorganization that each Fund receive an
opinion of tax counsel that the transaction would be a tax-free
transaction.
. Although the Fund agreed to pay the estimated costs of the
Reorganization allocated to Class A and Class B shares and a portion
of the estimated costs of the Reorganization allocated to Class C
shares, management has estimated that such allocated costs will be
recoverable from lower overall expense rates within six months of
completion of the Reorganization. Scudder Kemper agreed to pay a
portion of the estimated costs of the Reorganization allocated to
Class C shares and all of the costs of the Reorganization that exceed
estimated costs.
For these reasons, as more fully described below under "The Proposed
Transaction -- Board Approval of the Proposed Transaction," the Board of
Directors, including the Independent Directors, has concluded that:
. the Reorganization is in the best interests of the Fund and its
shareholders; and
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<PAGE>
. the interests of the existing shareholders of the Fund will not be
diluted as a result of the Reorganization.
Accordingly, the Directors unanimously recommend approval of the Plan
effecting the Reorganization. If the Plan is not approved, the Fund will
continue in existence unless other action is taken by the Directors.
Investment Objectives, Policies and Restrictions of the Funds
This section will help you compare the investment objectives and policies
of the Fund and Scudder Global Fund. Please be aware that this is only a
summary. More complete information may be found in the Funds' prospectuses.
The investment objectives, policies and restrictions of the Funds are
similar. Some differences do exist. The investment objective of Scudder Global
Fund is to seek long-term growth of capital while actively seeking to reduce
downside risk as compared with other global growth funds. The investment
objective of the Fund is to seek long-term capital growth. There can be no
assurance that either Fund will achieve its investment objective.
Scudder Global Fund invests at least 65% of its total assets in U.S. and
foreign equities (equities issued by U.S. and foreign-based companies) and may
invest in companies of any size. Most of Scudder Global Fund's equity
investments are common stocks. The Fund invests at least 65% of its total assets
in common stocks and other equities issued by "blue chip" companies throughout
the world. These are large, well known companies that typically have an
established earnings and dividends history, easy access to credit, solid
positions in their industries and strong management. Each Fund may invest in
companies from any country, but primarily focuses on established companies in
countries with developed economies. Scudder Global Fund does not invest in
securities issued by tobacco-producing companies.
Both Funds have the same portfolio management team. In choosing stocks for
Scudder Global Fund, the Investment Manager conducts bottom-up research, and
invests primarily in companies that offer, among other things, the potential for
sustainable above-average earnings growth and whose market value appears
reasonable in light of their business prospects. In addition, the Investment
Manager uses analytical tools to actively monitor the risk profile of Scudder
Global Fund's portfolio as compared to comparable funds and appropriate
benchmarks and peer groups, and uses several strategies in seeking to reduce
downside risk, including (i) diversifying broadly among companies, industries,
countries and regions; (ii) focusing on high quality companies with reasonable
valuations; and (iii) generally focusing on countries with developed economies.
With respect to Scudder Global Fund, the Investment Manager also conducts an
analysis of global themes. In choosing stocks for the Fund, the Investment
Manager looks for those blue chip companies that appear likely to benefit from
global economic trends or have promising new technologies or products. Scudder
Global Fund will normally sell a stock when the Investment Manager believes its
price is unlikely to go much higher, its fundamentals have deteriorated, other
investments offer better opportunities or in the course of adjusting its
emphasis on a given country. The Fund will normally sell a stock when the
Investment Manager believes it has reached its fair value, when its fundamental
factors have changed or when adjusting its exposure to a given country or
industry.
Scudder Global Fund may invest up to 5% of its total assets in debt
securities that are rated Baa or below by Moody's Investor Services, Inc. or BBB
or below by Standard & Poor's Ratings Services ("high yield" or "junk" bonds).
The Fund may invest up to 15% of its total assets in emerging market debt or
equity securities of emerging markets (of which 5% of net assets may be grade BB
or below, i.e., "junk bonds"). Scudder Global Fund is not subject to any limit
on emerging market security investments,
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<PAGE>
although, as stated above, it is limited in the amount it can invest in junk
bonds. Although each Fund is permitted to use various types of derivatives
(contracts whose value is based on, for example, indices, currencies or
securities), the Investment Manager does not intend to use them as principal
investments for either Fund, and might not use them
at all.
The Funds' fundamental investment restrictions and non-fundamental
investment restrictions, as set forth under "Investment Restrictions" in each
Fund's statement of additional information, are identical, except that the Fund
(but not Scudder Global Fund) has a stated non-fundamental investment
restriction limiting the Fund's investments in illiquid securities to no more
than 15% of its net assets. Both Funds are, however, subject to such restriction
pursuant to applicable regulation. Fundamental investment restrictions may not
be changed without the approval of Fund shareholders, while non-fundamental
investment restrictions may be changed by the applicable Board without
shareholder approval. Investors should refer to each Fund's statement of
additional information for a more detailed description of the Fund's investment
policies and restrictions.
Portfolio Turnover
The portfolio turnover rate for Scudder Global Fund, i.e., the ratio of the
lesser of annual sales or purchases to the monthly average value of the
portfolio (excluding from both the numerator and the denominator securities with
maturities at the time of acquisition of one year or less), for the fiscal year
ended August 31, 2000 was 60%. The portfolio turnover rate for the Fund for the
fiscal year ended October 31, 2000 was 54%.
Comparative Considerations
The portfolio characteristics of the combined fund after the Reorganization
will reflect the blended characteristics of the Fund and Scudder Global Fund.
The following characteristics are as of ________, 2000 for both Funds and also
reflect the blended characteristics of both Funds after the Reorganization as of
that same date.
Portfolio Composition (1)
As a % of Net Assets
<TABLE>
<CAPTION>
----------------------------------------------------------------------------------------------------------------
% in U.S. % in % in % in % in Average
U.S. European Japanese Pacific Bonds Market-Cap
Equities Equities Equities Basin ($)
Equities
----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Fund
----------------------------------------------------------------------------------------------------------------
Scudder Global Fund
----------------------------------------------------------------------------------------------------------------
Pro Forma
(Combined) (2)
----------------------------------------------------------------------------------------------------------------
</TABLE>
(1) The Fund normally invests at least 65% of its total assets in common stocks
and other equities of "blue chip" companies that typically have an established
earnings and dividend history, easy access to credit, solid positions in their
industries and strong management. Scudder Global Fund normally invests at least
65% of its total assets in U.S. and foreign equities (equities issued by U.S.
and foreign-based companies), and most of its equities are common stocks. Each
Fund may invest in any country, but primarily focuses on countries with
developed economies.
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<PAGE>
(2) Reflects the blended characteristics of the Fund and Scudder Global Fund as
of ________, 2000.
Performance
The following table shows how the returns of the Fund and Scudder Global
Fund over different periods average out. For context, the table also includes a
broad-based market index (which, unlike the Funds, does not have any fees or
expenses). The performances of both Funds and the index vary over time, and past
performance is not necessarily indicative of future results. All figures assume
reinvestment of dividends and distributions.
Average Annual Total Return
for the Periods Ended December 31, 2000
[Insert Table]
For management's discussion of Scudder Global Fund's performance for the
fiscal year ended August 31, 2000, please refer to Exhibit B.
Investment Manager; Fees and Expenses
Each Fund retains the investment management firm of Scudder Kemper,
pursuant to separate contracts, to manage its daily investment and business
affairs, subject to the policies established by each Fund's Directors. Scudder
Kemper is a Delaware corporation located at 345 Park Avenue, New York, New York
10154.
Pursuant to separate contracts, both Funds pay the Investment Manager a
graduated investment management fee, although the fee rates and breakpoints
differ. The fee is graduated so that increases in a Fund's net assets may result
in a lower annual fee rate and decreases in its net assets may result in a
higher annual fee rate. However, the Investment Manager has contractually agreed
to cap the Fund's total operating expenses expressed as a percentage of average
daily net assets at 1.80%, 2.68% and 2.65% for Class A, Class B and Class C
shares, respectively, through February 28, 2002. As of August 31, 2000, Scudder
Global Fund had total net assets of $1,551,884,193. For the fiscal year ended
August 31, 2000, Scudder Global Fund paid the Investment Manager a fee of 0.95%
of its average daily net assets. As of October 31, 2000, the Fund had total net
assets of $36,262,281. For the fiscal year ended October 31, 2000, the Fund paid
the Investment Manager a fee of 0.85% (after waivers) of its average daily net
assets.
The fee schedule for the combined fund after the Reorganization will be
identical to the current fee schedule for Scudder Global Fund. Currently the fee
schedules for the Fund and Scudder Global Fund are as follows:
<TABLE>
<CAPTION>
--------------------------------------------------------------------------------------------------------
Fund Scudder Global Fund
--------------------------------------------------------------------------------------------------------
Average Daily Net Assets Fee Rate Average Daily Net Assets Fee Rate
------------------------ -------- ------------------------ --------
<S> <C> <C> <C>
First $250 million 1.00% First $500 million 1.00%
Next $750 million 0.95% Next $500 million 0.95%
Over $1 billion 0.90% Next $500 million 0.90%
Next $500 million 0.85%
Over $2 billion 0.80%
--------------------------------------------------------------------------------------------------------
</TABLE>
Because of differences in breakpoints, at assets less than $1.75 billion, the
Fund's current fee schedule would produce a lower effective advisory fee rate,
while at assets of greater than $1.75 billion, Scudder Global Fund's fee
schedule would produce a lower fee rate.
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<PAGE>
Administrative Fee
Scudder Global Fund has entered into an administration agreement with
Scudder Kemper (the "Administration Agreement"), pursuant to which Scudder
Kemper provides or pays others to provide substantially all of the
administrative services required by Scudder Global Fund (other than those
provided by Scudder Kemper under its investment management agreement with that
Fund) in exchange for the payment by Scudder Global Fund of an annual
administrative services fee (the "Administrative Fee") equal to 0.400%, 0.450%
and 0.425% of average daily net assets attributable to the Class A, Class B and
Class C shares, respectively. The fees for the services provided by Kemper
Distributors, Inc. ("KDI") under its services agreement and underwriting and
distribution services agreement with Scudder Global Fund are not covered by, and
are in addition to, the Administrative Fee. One effect of this arrangement is to
make Scudder Global Fund's future expense ratio more predictable. On the other
hand, the administrative fee rate does not decrease with economies of scale from
increases in asset size or decreased operating expenses. The details of this
arrangement (including expenses that are not covered) are set out below.
Various service providers (the "Service Providers"), some of which are
affiliated with Scudder Kemper, provide certain services to Scudder Global Fund
pursuant to separate agreements. These Service Providers may differ from current
Service Providers of the Fund. Scudder Fund Accounting Corporation, a subsidiary
of Scudder Kemper, computes net asset value for Scudder Global Fund and
maintains its accounting records. Kemper Service Company, also a subsidiary
of Scudder Kemper, is the transfer, shareholder servicing and dividend-paying
agent for the Class A, Class B and Class C shares of Scudder Global Fund.
Scudder Trust Company, an affiliate of Scudder Kemper, provides subaccounting
and recordkeeping services for shareholder accounts in certain retirement and
employee benefit plans. As custodian, Brown Brothers Harriman & Company holds
the portfolio securities of Scudder Global Fund, pursuant to a custodian
agreement. Other Service Providers include the independent public accountants
and legal counsel for Scudder Global Fund.
Under the Administration Agreement, each Service Provider provides the
services to Scudder Global Fund described above, except that Scudder Kemper pays
these entities for the provision of their services to Scudder Global Fund and
pays most other fund expenses, including insurance, registration, printing and
postage fees. In return, Scudder Global Fund pays Scudder Kemper the
Administrative Fee.
The Administration Agreement will remain in effect with respect to the
Class A, Class B and Class C shares for an initial term ending September 30,
2003, subject to earlier termination by the directors that oversee Scudder
Global Fund. The fee payable by Scudder Global Fund to Scudder Kemper pursuant
to the Administration Agreement will be reduced by the amount of any credit
received from Scudder Global Fund's custodian for cash balances.
Certain expenses of Scudder Global Fund are not borne by Scudder Kemper
under the Administration Agreement, such as taxes, brokerage, interest and
extraordinary expenses, and the fees and expenses of the Independent Directors
(including the fees and expenses of their independent counsel). Scudder Global
Fund continues to pay the fees required by its investment management agreement
with Scudder Kemper. In addition, it pays the fees under its services agreement
and underwriting and distribution services agreement with KDI, as described in
"Distribution and Service Fees" below.
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<PAGE>
Comparison of Expenses
The tables and examples below are designed to assist you in understanding
the various costs and expenses that you will bear directly or indirectly as an
investor in the Class A, Class B and Class C shares of Scudder Global Fund, and
compares these with the expenses of the Fund. [Comparative statement regarding
expenses to be added.] Unless otherwise noted, the information is based on each
Fund's expenses and average daily net assets during the twelve months ended
September 30, 2000 and on a pro forma basis as of that date and for the twelve
month period then ended, assuming the Reorganization had been in effect for the
period.
Expense Comparison Table
Class A Shares
<TABLE>
<CAPTION>
Scudder
Global Pro Forma
Shareholder Fees Fund Fund (Combined)(1)
---------------- ---- ---- ---------
<S> <C> <C> <C>
Maximum Sales Charge (Load) Imposed on Purchases 5.75% 5.75% 5.75%
(as % of offering price)
Maximum Contingent Deferred Sales Charge (Load) None None None
(as % of redemption proceeds)(2)
Maximum Deferred Sales Charge (Load) imposed on None None None
reinvested dividends
Redemption Fee (as a percentage of amount None None None
redeemed, if applicable)
Annual Fund Operating Expenses (unaudited)
------------------------------
(as a % of average net assets)
-----------------------------
Management Fees 1.00% 0.95% 0.94%
Rule 12b-1/ASF Fees 0.25% 0.25% 0.25%
Other Expenses 1.32% .40%(3) 0.40%
Total Annual Fund Operating Expenses 2.57% 1.60% 1.59%
Expense Waiver 0.77% None None
Net Annual Fund Operating Expenses 1.80%(4) 1.60% 1.59%
Expense Example of Total Operating Expenses at
----------------------------------------------
the End of the Period(5)
---------------------
One Year $ 747 $ 728 $ 727
</TABLE>
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<PAGE>
Three Years $1,260 $1,051 $1,048
Five Years $1,797 $1,396 $1,391
Ten Years $3,259 $2,366 $2,356
________________
Notes to Expense Comparison Table:
----------------------------------
(1) The Pro Forma column reflects expenses estimated for the Reorganized Fund
subsequent to the Reorganization and reflects the effect of the
Reorganization, including the implementation of Scudder Global Fund's
Administration Agreement and distribution plan.
(2) Class A shares purchased under the Large Order NAV Purchase Privilege have
a 1% contingent deferred sales charge for shares sold during the first year
after purchase and .50% for shares sold during the second year after
purchase.
(3) Restated to reflect the implementation of Scudder Global Fund's
Administration Agreement.
(4) By contract, total operating expenses of the Class A shares of the Fund are
capped at 1.80%, through February 28, 2002. There is no guarantee that
this expense waiver will continue beyond February 28, 2002.
(5) Expense examples reflect what an investor would pay on a $10,000
investment, assuming a 5% annual return, the reinvestment of all dividends,
total operating expenses remain the same and redemptions at the end of each
period.
Expense Comparison Table
Class B Shares
<TABLE>
<CAPTION>
Scudder
Global Pro Forma
Shareholder Fees Fund Fund (Combined)(1)
---------------- ---- ---- ---------
<S> <C> <C> <C>
Maximum Sales Charge (Load) Imposed on Purchases None None None
(as % of offering price)
Maximum Contingent Deferred Sales Charge (Load) 4.00% 4.00% 4.00%
(as % of redemption proceeds)(2)
Maximum Deferred Sales Charge (Load) imposed on None None None
reinvested dividends
Redemption Fee (as a percentage of amount None None None
redeemed, if applicable)
Annual Fund Operating Expenses (unaudited)
------------------------------
(as a % of average net assets)
-----------------------------
Management Fees 1.00% 0.95% 0.94%
Rule 12b-1/ASF Fees 1.00% 1.00% 1.00%
Other Expenses 1.44% 0.45%(3) 0.45%
Total Annual Fund Operating Expenses 3.44% 2.40% 2.39%
</TABLE>
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<PAGE>
<TABLE>
<CAPTION>
Scudder
Global Pro Forma
Fund Fund (Combined)(1)
---- ---- ---------
<S> <C> <C> <C>
Expense Waiver 0.76% None None
Net Annual Fund Operating Expenses
2.68%(4) 2.40% 2.39%
Expense Example of Total Operating Expenses
-------------------------------------------
Assuming Redemption at the End of the Period(5)
--------------------------------------------
One Year $ 671 $ 643 $ 642
Three Years $1,286 $1,048 $1,045
Five Years $1,924 $1,480 $1,475
Ten Years $3,294 $2,356 $2,345
Expense Example of Total Operating Expenses
-------------------------------------------
Assuming No Redemption at the End of the Period(5)
-----------------------------------------------
One Year $ 271 $ 243 $ 242
Three Years $ 986 $ 748 $ 745
Five Years $1,724 $1,280 $1,275
Ten Years $3,294 $2,356 $2,345
</TABLE>
___________
Notes to Expense Comparison Table:
----------------------------------
(1) The Pro Forma column reflects expenses estimated for the Reorganized Fund
subsequent to the Reorganization and reflects the effect of the
Reorganization, including the implementation of Scudder Global Fund's
Administration Agreement and distribution plan.
(2) Contingent deferred sales charges on Class B shares sold during the first
six years of ownership are 4% in the first year, 3% in the second and third
year, 2% in the fourth and fifth year, and 1% in the sixth year.
(3) Restated to reflect the implementation of Scudder Global Fund's
Administration Agreement.
(4) By contract, total operating expenses of the Class B shares of the Fund are
capped at 2.68%, through February 28, 2002. There is no guarantee that
this expense waiver will continue beyond February 28, 2002.
(5) Expense examples reflect what an investor would pay on a $10,000
investment, assuming a 5% annual return, the reinvestment of all dividends
and total operating expenses remain the same. Assumes conversion to Class
A shares six years after purchase.
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<PAGE>
Expense Comparison Table
Class C Shares
<TABLE>
<CAPTION>
Scudder
Global Pro Forma
Shareholder Fees Fund Fund (Combined)(1)
---------------- ---- ---- ---------
<S> <C> <C> <C>
Maximum Sales Charge (Load) Imposed on Purchases None None None
(as % of offering price)
Maximum Contingent Deferred Sales Charge (Load) 1.00% 1.00% 1.00%
(as % of redemption proceeds)(2)
Maximum Deferred Sales Charge (Load) imposed on None None None
reinvested dividends
Redemption Fee (as a percentage of amount None None None
redeemed, if applicable)
Annual Fund Operating Expenses (unaudited)
-----------------------------------------
(as a % of average net assets)
-----------------------------
Management Fees 1.00% 0.95% 0.94%
Rule 12b-1/ASF Fees 1.00% 1.00% 1.00%
Other Expenses 1.61% 0.43%(3) 0.43%
Total Annual Fund Operating Expenses 3.61% 2.38% 2.37%
Expense Waiver 0.96% None None
Net Annual Fund Operating Expenses 2.65%(4) 2.38% 2.37%
Expense Example of Total Operating Expenses
-------------------------------------------
Assuming Redemption at the End of the Period(5)
--------------------------------------------
One Year $ 368 $ 341 $ 340
Three Years $1,017 $ 742 $ 739
Five Years $1,788 $1,270 $1,265
Ten Years $3,809 $2,716 $2,706
Expense Example of Total Operating Expenses
-------------------------------------------
Assuming No Redemption at the End of the Period(5)
-----------------------------------------------
One Year $ 268 $ 241 $ 240
Three Years $1,017 $ 742 $ 739
</TABLE>
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<PAGE>
Scudder
Global Pro Forma
Fund Fund (Combined)(1)
---- ---- ---------
Five Years $1,788 $1,270 $1,265
Ten Years $3,809 $2,716 $2,706
___________
Notes to Expense Comparison Table:
----------------------------------
(1) The Pro Forma column reflects expenses estimated for the Reorganized Fund
subsequent to the Reorganization and reflects the effect of the
Reorganization, including the implementation of Scudde Global Fund's
Administration Agreement and distribution plan.
(2) Contingent deferred sales charge on Class C shares is 1% for shares sold
during the first year after purchase.
(3) Restated to reflect the implementation of Scudder Global Fund's
Administration Agreement.
(4) By contract, total operating expenses of the Class C shares of the Fund are
capped at 2.65%, through February 28, 2002. There is no guarantee that
this expense waiver will continue beyond February 28, 2002.
(5) Expense examples reflect what an investor would pay on a $10,000
investment, assuming a 5% annual return, the reinvestment of all dividends
and total operating expenses remain the same.
Distribution and Services Fees
Pursuant to an underwriting and distribution services agreement with
Scudder Global Fund, KDI, 222 South Riverside Plaza, Chicago, Illinois 60606, an
affiliate of the Investment Manager, will act as the principal underwriter and
distributor of the Class A, Class B and Class C shares of that Fund and will act
as agent of the Fund in the continuing offer of such shares. Scudder Global Fund
has adopted distribution plans on behalf of the Class A, Class B and Class C
shares in accordance with Rule 12b-1 under the 1940 Act that are substantially
identical to the existing distribution plans adopted by the Fund, with one
exception. As under the current distribution plans for the Fund, Scudder Global
Fund pays KDI an asset-based fee at an annual rate of 0.75% of Class B and
Class C shares. The distribution plans for Scudder Global Fund, however, unlike
the distribution plans for the Fund, also authorize the payment to KDI of the
0.25% services fee with respect to the Class A, Class B and Class C shares
pursuant to the services agreement described below. Neither KDI nor the
Directors of the Fund believe that the services performed by KDI under the
services agreement have been primarily intended to result in sales of fund
shares (i.e., "distribution" services) as defined in Rule 12b-1, but rather are
post-sale administrative and other services provided to existing shareholders.
Nonetheless, to avoid legal uncertainties due to the ambiguity of the language
contained in Rule 12b-1 and eliminate any doubt that may arise in the future
regarding whether the services performed by KDI under the services agreement are
"distribution" services, the distribution plans for Scudder Global Fund
authorize the payment of the services fee. The fact that the services fee
is authorized by Scudder Global Fund's distribution plans does not change the
fee rate or affect the nature or quality of the services provided by
KDI.
Pursuant to the services agreement with Scudder Global Fund, which is
substantially identical to the current services agreement with the Fund, KDI
receives a services fee of up to 0.25% per year with respect to the Class A,
Class B and Class C shares of Scudder Global Fund. KDI uses the services fee to
compensate financial services firms ("firms") for providing personal services
and maintenance of accounts for their customers that hold those classes of
shares of Scudder Global Fund, and may retain any portion of the fee not paid to
firms to compensate itself for administrative functions performed for the Fund.
All fee amounts are payable monthly and are based on the average daily net
assets of each Fund attributable to the relevant class of shares.
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<PAGE>
Purchases, Exchanges, and Redemptions
Both Funds are part of the Scudder Kemper complex of mutual funds. The
procedures for purchases, exchanges, and redemptions of Class A, Class B and
Class C shares of Scudder Global Fund are identical to those of the Fund. Shares
of Scudder Global Fund are exchangeable for shares of the same class of most
other open-end funds advised by Scudder Kemper offering such shares.
Corresponding classes of shares of Scudder Global Fund have identical sales
charges to those of the Fund. Scudder Global Fund has a maximum initial sales
charge of 5.75% on Class A shares. Shareholders who purchase $1 million or more
of Class A shares pay no initial sales charge but may have to pay a contingent
deferred sales charge (a "CDSC") of up to 1% if the shares are sold within 2
years of the date on which they were purchased. Class B shares are sold without
a front-end sales charge, but may be subject to a CDSC upon redemption,
depending on the length of time the shares are held. The CDSC begins at 4% for
shares sold in the first year, declines to 1% in the sixth year and is
eliminated after the sixth year. After six years, Class B shares automatically
convert to Class A shares. Class C shares are sold without a front-end sales
charge, but may be subject to a CDSC of up to 1% if the shares are sold within
one year of purchase.
Class A, Class B and Class C shares of Scudder Global Fund received in the
Reorganization will be issued at net asset value, without a sales charge, and no
CDSC will be imposed on any shares of the Fund exchanged for shares of Scudder
Global Fund as a result of the Reorganization. However, following the
Reorganization, any CDSC that applies to shares of the Fund will continue to
apply to shares of Scudder Global Fund received in the Reorganization, using the
original purchase date for such shares to calculate the holding period, rather
than the date such shares are received in the Reorganization.
Services available to shareholders of Class A, Class B and Class C shares
of Scudder Global Fund will be identical to those available to shareholders of
the corresponding classes of the Fund and include the purchase and redemption of
shares through an automated telephone system and over the Internet, telephone
redemptions, and exchanges by telephone to most other Scudder Kemper funds that
offer Class A, Class B and Class C shares, and reinvestment privileges. Please
see the Scudder Global Fund's prospectus for additional information.
Dividends and Other Distributions
Each Fund intends to distribute its investment company taxable income and
any net realized capital gains in November or December. An additional
distribution may be made if necessary. Shareholders of each Fund can have their
dividends and distributions automatically invested in additional shares of the
same class of that Fund, or a different fund in the same family of Funds, at net
asset value and credited to the shareholder's account on the payment date or, at
the shareholder's election, paid in cash. For retirement plans, reinvestment is
the only option.
If the Plan is approved by the Fund's shareholders, the Fund will pay its
shareholders a distribution of all undistributed net investment income and
undistributed realized net capital gains immediately prior to the Closing.
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<PAGE>
Other Differences Between the Funds.
Charter Documents.
Each of the Acquired Corporation and the Acquiring Corporation is
organized as a Maryland corporation under separate Articles of
Incorporation. Although these Articles of Incorporation are substantially
similar, some differences do exist. The most significant difference is that
the Acquired Corporation's Articles of Incorporation specifically permit
the creation of a master feeder structure; the Acquiring Corporation's
Articles of Incorporation are silent with regard to master feeder
structures.
Directors and Officers.
The Directors of the Acquired Corporation, currently and as proposed
under Proposal 1, are different from those of the Acquiring Corporation.
As described in Scudder Global Fund's prospectus that has been included in
the materials that you received with this document, the following
individuals comprise the Board of Directors of Scudder Global Fund: Linda
C. Coughlin, Henry P. Becton, Jr., Dawn-Marie Driscoll, Edgar Fiedler,
Keith R. Fox, Joan E. Spero, Jean Gleason Stromberg, Jean C. Tempel, and
Steven Zaleznick. In addition, the officers of the Acquired Corporation
and the Acquiring Corporation are different. (See Proposal 1 and the
Statement of Additional Information for further information.)
Fiscal Year.
The Fund's fiscal year-end is October 31. Scudder Global Fund's
fiscal year-end is August 31.
Auditors.
The Fund's auditors are Ernst & Young LLP. Scudder Global Fund's
auditors are PricewaterhouseCoopers LLP.
Tax Consequences
As a condition to the Reorganization, each Fund will have received an
opinion of Willkie Farr & Gallagher in connection with the Reorganization, to
the effect that, based upon certain facts, assumptions and representations, the
Reorganization will constitute a tax-free reorganization within the meaning of
section 368(a)(1) of the Internal Revenue Code of 1986, as amended (the "Code").
If the Reorganization constitutes a tax-free reorganization, no gain or loss
will be recognized by the Fund or its shareholders as a direct result of the
Reorganization. See "The Proposed Transaction -- Federal Income Tax
Consequences."
* * *
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<PAGE>
The preceding is only a summary of certain information contained in this
Proxy Statement/Prospectus relating to the Reorganization. This summary is
qualified by reference to the more complete information contained elsewhere in
this Proxy Statement/Prospectus, the prospectuses and statements of additional
information of the Funds, and the Plan. Shareholders should read this entire
Proxy Statement/Prospectus carefully.
II. PRINCIPAL RISK FACTORS
Because of their similar investment objectives, policies and strategies,
the principal risks presented by Scudder Global Fund are similar to those
presented by the Fund. The main risks applicable to each Fund include, among
others, market risk, management risk (i.e., securities selection by the
Investment Manager), the risks associated with foreign securities (including
currency fluctuations, lower liquidity, economic and political risks, and
differences in accounting methods) and, to the extent a Fund invests in debt
securities, risk associated with interest rates. Because the Fund may invest a
greater percentage of its assets in debt securities, it may be subject to a
greater degree of risk associated with rising interest rates or declines in
credit quality. In addition, each Fund may invest a portion of its assets in
high yield securities, or "junk bonds," which entail relatively greater risk of
loss of income and principal than investments in higher rated securities, and
may fluctuate more in value. To the extent that a Fund invests in emerging
markets, such Fund would be subject to the risk that emerging markets tend to be
more volatile than developed markets. This risk may have a greater effect on
Scudder Global Fund because it is not subject to a stated limit on the
percentage of its assets that may be invested in emerging markets countries.
However, both Funds primarily focus on companies in developed countries. To the
extent that Scudder Global Fund invests a greater percentage of its assets in
smaller, less well-known companies than does the Fund, it would be subject to
the risk that the stocks of such companies may be more volatile than the stocks
of large, well-established companies, in part because these companies tend to be
less established and the valuation of their stocks often depends on future
expectations. Scudder Global Fund's attempt to reduce downside risk may reduce
its respective performance relative to other similar funds in a strong market.
Lastly, the Funds are not insured or guaranteed by the FDIC or any other
government agency. Share prices will go up and down, so be aware that you could
lose money.
For a further discussion of the investment techniques and risk factors
applicable to Scudder Global Fund and the Fund, see "Investment Objectives,
Policies and Restrictions of the Funds" herein, and the prospectuses and
statements of additional information for the Funds.
III. THE PROPOSED TRANSACTION
Description of the Plan
As stated above, the Plan provides for the transfer of all or substantially
all of the assets of the Fund to Scudder Global Fund in exchange for that number
of full and fractional Class A, Class B and Class C shares having an aggregate
net asset value equal to the aggregate net asset value of the shares of the
corresponding classes of the Fund as of the close of business on the Valuation
Date. Scudder Global Fund will assume all of the liabilities of the Fund. The
Fund will distribute the Class A, Class B and Class C shares received in the
exchange to the shareholders of the Fund in complete liquidation of the Fund.
The Fund will then be terminated.
Upon completion of the Reorganization, each shareholder of the Fund will
own that number of full and fractional Class A, Class B and Class C Shares
having an aggregate net asset value equal to the aggregate net asset value of
such shareholder's shares of the corresponding class held in the Fund as of the
close of business on the Valuation Date. Such shares will be held in an account
with Scudder Global Fund identical in all material respects to the account
currently maintained by the Fund for such shareholder. In the interest of
economy and convenience, Class A, Class B and Class C shares issued to
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<PAGE>
the Fund's shareholders in the Reorganization will be in uncertificated form. If
Class A, Class B or Class C shares of the Fund are represented by certificates
prior to the Closing, such certificates should be returned to the Fund's
shareholder servicing agent. Any Class A, Class B or Class C shares of Scudder
Global Fund distributed in the Reorganization to shareholders in exchange for
certificated shares of the Fund may not be transferred, exchanged or redeemed
without delivery of such certificates.
Until the Closing, shareholders of the Fund will continue to be able to
redeem their shares at the net asset value next determined after receipt by the
Fund's transfer agent of a redemption request in proper form. Redemption and
purchase requests received on or after the Valuation Date by the transfer agent
will be treated as requests received for the redemption or purchase of Class A,
Class B or Class C shares of Scudder Global Fund received by the shareholder in
connection with the Reorganization.
The obligations of each of the Acquired Corporation, on behalf of the Fund,
and the Acquiring Corporation, on behalf of Scudder Global Fund, under the Plan
are subject to various conditions, as stated therein. The Plan also requires
that all filings be made with, and all authority be received from, the SEC and
state securities commissions as may be necessary in the opinion of counsel to
permit the parties to carry out the transactions contemplated by the Plan. Each
Fund is in the process of making the necessary filings. To provide for
unforeseen events, the Plan may be terminated: (i) by the mutual agreement of
the parties; (ii) by either party if the Closing has not occurred by [ ], 2001,
unless such date is extended by mutual agreement of the parties; or (iii) by
either party if the other party has materially breached its obligations under
the Plan or made a material misrepresentation in the Plan or in connection with
the Reorganization. The Plan may also be amended by mutual agreement in writing.
However, no amendment may be made following the shareholder meeting if such
amendment would have the effect of changing the provisions for determining the
number of shares of Scudder Global Fund to be issued to the Fund in the Plan to
the detriment of the Fund's shareholders without their approval. For a complete
description of the terms and conditions of the Reorganization, please refer to
the Plan at Exhibit A.
Board Approval of the Proposed Transaction
As discussed above, the Reorganization is part of a Scudder Kemper
initiative that is intended to restructure and streamline the management and
operations of the funds Scudder Kemper advises. Scudder Kemper first proposed
the Reorganization to the Directors of the Fund at a meeting held on May 24,
2000, see "Synopsis--Background of the Reorganization" above. This initiative
includes five major components:
(i) A change in branding to offer virtually all funds advised by Scudder
Kemper under the Scudder Investments name, with a concentration on
intermediary distribution;
(ii) The combination of funds with similar investment objectives and
policies, including in particular the combination of the Kemper
Funds with similar Scudder Funds currently offered to the general
public;
(iii) The liquidation of certain small funds which have not achieved
market acceptance and which are unlikely to reach an efficient
operating size;
(iv) The implementation of an administration agreement for the Kemper
Funds similar to that recently adopted by the Scudder Funds
covering, for a single fee rate, substantially all services required
for the operation of the fund (other than those provided under the
fund's investment management agreement) and most expenses; and
(v) The consolidation of certain boards overseeing funds advised by
Scudder Kemper.
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<PAGE>
The Independent Directors of the Fund reviewed the potential implications
of these proposals for the Fund as well as the various other funds for which
they serve as board members. They were assisted in this review by their
independent legal counsel and by independent consultants with special expertise
in financial and mutual fund industry matters. Following the May 24/th/
meeting, the Independent Directors met in person or by telephone on numerous
occasions (including committee meetings) to review and discuss these proposals,
both among themselves and with representatives of Scudder Kemper, including the
"interested" Directors. In the course of their review, the Independent
Directors requested and received substantial additional information and
suggested numerous changes to Scudder Kemper's proposals.
Following the conclusion of this process, the Directors of the Fund, the
board members of other funds involved and Scudder Kemper reached general
agreement on the elements of a restructuring plan that they believed were in the
best interests of shareholders and, where required, agreed to submit elements of
the plan for approval to shareholders of those funds.
On November 29, 2000, the Board of Directors, including the Independent
Directors, unanimously approved the terms of the Reorganization and certain
related proposals. The Directors have also unanimously agreed to recommend that
the Reorganization be approved by the Fund's shareholders.
In determining whether to recommend that the shareholders of the Fund
approve the Reorganization, the Board of Directors considered that:
. As part of Scudder Kemper's overall restructuring, the Fund would be
duplicative of another similar fund advised by Scudder Kemper in the
same distribution channel.
. At the current level of assets of the combined fund, the effective
advisory fee rate would be lower than that currently charged by the
Fund.
. The fixed fee rate under the Administration Agreement is expected to
be less than the estimated current applicable operating expenses the
Fund would otherwise pay.
. It is a condition of the Reorganization that each Fund receive an
opinion of tax counsel that the transaction would be a tax-free
transaction.
. Although the Fund agreed to pay the estimated costs of the
Reorganization allocated to Class A and Class B shares and a portion
of the estimated costs of the Reorganization allocated to Class C
shares, management has estimated that such allocated costs will be
recoverable from lower overall expense rates within six months of
completion of the Reorganization. Scudder Kemper agreed to pay a
portion of the estimated costs of the Reorganization allocated to
Class C shares and all of the costs of the Reorganization that exceed
estimated costs.
As part of their deliberations, the Directors considered, among other
things: (a) the fees and expense ratios of the Funds, including comparisons
between the expenses of the Fund and the estimated operating expenses of Scudder
Global Fund after the Reorganization, and between the estimated operating
expenses of Scudder Global Fund and other mutual funds with similar investment
objectives; (b) the terms and conditions of the Reorganization and whether the
Reorganization would result in the dilution of shareholder interests; (c) the
compatibility of the Funds' investment objectives, policies, restrictions and
portfolios; (d) the service features available to shareholders of each Fund; (e)
prospects for Scudder Global Fund to attract additional assets; and (f) the
investment performance of each Fund.
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<PAGE>
As part of their analysis, the Directors considered direct and indirect
costs to shareholders including: (a) the direct costs of the Reorganization to
be borne by existing shareholders; (b) the potential costs of any necessary
rebalancing of the Fund's portfolio; and (c) the potential tax consequences to
shareholders as a result of differences in the Funds' realized or unrealized
capital gains or losses and capital loss carry-forwards.
Costs. The anticipated costs of the Reorganization allocable to the Fund
are $33,001, which includes board meeting fees, legal, accounting and other
consultant fees, and proxy solicitation costs. Class A shares of the Fund will
pay $11,984 and Class B shares of the Fund will pay $16,116, each of which
represents 100% of the estimated costs allocable to Class A and Class B shares,
respectively. Class C shares will pay a portion of their allocable costs of the
Reorganization, or $4,573 out of $4,901 (93.31%). Scudder Kemper is bearing the
remaining costs, including any cost overruns (except that Scudder Global Fund is
bearing the SEC and state registration and notice fees which are estimated to be
$_________).
The costs of the Reorganization borne by the Fund have been (or will soon
be) expensed, resulting in a reduction of $0.0095 for Class A shares, $0.0163
for Class B shares and $0.0187 for Class C shares, based on [_____], 2000 net
assets of the Fund. Management of the Fund expects that reduced operating
expenses resulting from the Reorganization should allow for recovery of the
allocated costs of the Reorganization within six months after the Closing.
Portfolio Transaction Costs. To consider the potential costs of any
necessary rebalancing of the Fund's portfolio as a result of the Reorganization,
the Independent Directors asked for, and Scudder Kemper provided, an estimate of
the expected turnover of the securities of the Fund, as a percentage of the
assets of the combined Fund, as a result of the Reorganization. Scudder Kemper
estimated such turnover to be 0%, resulting in transaction costs of less than
$0.01 per share of the Fund, which the Directors considered immaterial.
Potential Tax Consequences. Although the Reorganizations will be achieved
on a federally tax-free basis (see "Federal Income Tax Consequences" below),
there are differences in the Funds' realized or unrealized capital gains or
losses and capital loss carry forwards, which at May 31, 2000 were as follows
(although they may differ at the time of the Closing):
[Charts to be inserted]
As noted above, under the terms of the Plan, shareholders of the Fund will
receive shares of Scudder Global Fund in an amount equal to the relative net
asset value of their Fund shares. The Directors considered whether an adjustment
in this formula should be made for the above tax differentials. The Directors
determined that no adjustment should be made because the potential tax
consequences were not material, quantifiable or predictable because of (1)
uncertainties as to the amounts of any actual future realization of capital
gains or losses in view of future changes in portfolio values, (2) the exemption
of some shareholders from federal income taxation, and (3) the differing
consequences of federal and various other income taxation upon a distribution
received by each shareholder whose tax liability (if any) is determined by the
net effect of a multitude of considerations that are individual to the
shareholder. Shareholders should, however, review their own tax situation to
determine what effect, if any, these potential tax differences may have on them.
The Directors also gave extensive consideration to possible economies of
scale that might be realized by Scudder Kemper in connection with the
Reorganization, as well as the other fund combinations included in Scudder
Kemper's restructuring proposal.
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<PAGE>
Based on all the foregoing, the Board concluded that the Fund's
participation in the Reorganization would be in the best interests of the Fund
and would not dilute the interests of the Fund's shareholders. The Board of
Directors, including the Independent Directors, unanimously recommends that
shareholders of the Fund approve the Reorganization.
Description of the Securities to Be Issued
Scudder Global Fund is a series of the Acquiring Corporation, a corporation
organized under the laws of the state of Maryland on May 15, 1986. The Acquiring
Corporation's authorized capital consists of approximately 1.55 billion shares
of capital stock, par value $0.01 per share, 320 million shares of which are
allocated to Scudder Global Fund. The Directors of the Acquiring Corporation are
authorized to divide the Acquiring Corporation's shares into separate series.
Scudder Global Fund is one of four series of the Acquiring Corporation. The
Directors of the Acquiring Corporation are also authorized to further divide the
shares of the series of the Acquiring Corporation into classes. The shares of
Scudder Global Fund are currently divided into five classes, Class S, Class
AARP, Class A, Class B and Class C. Although shareholders of different classes
of a series have an interest in the same portfolio of assets, shareholders of
different expense levels because distribution costs and certain other expenses
approved by the Directors of the Acquiring Corporation are borne directly by the
class incurring such expenses.
Each share of each class of Scudder Global Fund represents an interest in
Scudder Global Fund that is equal to and proportionate with each other share of
that class of Scudder Global Fund. Scudder Global Fund shareholders are entitled
to one vote per share held on matters on which they are entitled to vote. In the
areas of shareholder voting and the powers and conduct of the Directors, there
are no material differences between the rights of shareholders of the Fund and
the rights of shareholders of Scudder Global Fund.
Federal Income Tax Consequences
The Reorganization is conditioned upon the receipt by each Fund of an
opinion from Willkie Farr & Gallagher substantially to the effect that, based
upon certain facts, assumptions and representations of the parties, for federal
income tax purposes: (i) the transfer to Scudder Global Fund of all or
substantially all of the assets of the Fund in exchange solely for Class A,
Class B and Class C shares and the assumption by Scudder Global Fund of all of
the liabilities of the Fund, followed by the distribution of such shares to the
Fund's shareholders in exchange for their shares of the Fund in complete
liquidation of the Fund, will constitute a "reorganization" within the meaning
of Section 368(a)(1) of the Code, and Scudder Global Fund and the Fund will each
be "a party to a reorganization" within the meaning of Section 368(b) of the
Code; (ii) no gain or loss will be recognized by the Fund upon the transfer of
all or substantially all of its assets to Scudder Global Fund in exchange solely
for Class A, Class B and Class C shares and the assumption by Scudder Global
Fund of all of the liabilities of the Fund or upon the distribution of the Class
A, Class B and Class C shares to shareholders of the Fund in exchange for their
shares of the Fund; (iii) the basis of the assets of the Fund in the hands of
Scudder Global Fund will be the same as the basis of such assets of the Fund
immediately prior to the transfer; (iv) the holding period of the assets of the
Fund in the hands of Scudder Global Fund will include the period during which
such assets were held by the Fund; (v) no gain or loss will be recognized by
Scudder Global Fund upon the receipt of the assets of the Fund in exchange for
Class A, Class B and Class C shares and the assumption by Scudder Global Fund of
all of the liabilities of the Fund; (vi) no gain or loss will be recognized by
the shareholders of the Fund upon the receipt of the Class A, Class B and Class
C shares solely in exchange for their shares of the Fund as part of the
transaction; (vii) the basis of the Class A, Class B and Class C shares received
by each shareholder of the Fund will be the same as the basis of the shares of
the Fund exchanged therefor; and (viii) the holding period of Class A, Class B
and Class C shares received by each shareholder of the Fund will include the
holding period during which the shares of the Fund exchanged
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<PAGE>
therefor were held, provided that at the time of the exchange the shares of the
Fund were held as capital assets in the hands of such shareholder of the Fund.
After the Closing, Scudder Global Fund may dispose of certain securities
received by it from the Fund in connection with the Reorganization, which may
result in transaction costs and capital gains.
While the Fund is not aware of any adverse state or local tax consequences
of the proposed Reorganization, it has not requested any ruling or opinion with
respect to such consequences and shareholders may wish to consult their own tax
adviser with respect to such matters.
Legal Matters
Certain legal matters concerning the federal income tax consequences of the
Reorganization will be passed on by Willkie Farr & Gallagher, 787 Seventh
Avenue, New York, New York 10019. Certain legal matters concerning the issuance
of shares of Scudder Global Fund will be passed on by Dechert, Ten Post Office
Square, South, Boston, Massachusetts 02109.
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<PAGE>
Capitalization
The following table shows on an unaudited basis the capitalization of the
Fund and Scudder Global Fund as of September 30, 2000 and on a pro forma basis
as of that date, giving effect to the Reorganization(1):
<TABLE>
<CAPTION>
Scudder Pro Forma
Fund Global Fund Adjustments Pro Forma (Combined)
------------ --------------- --------------- ---------------------
<S> <C> <C> <C> <C>
Net Assets
Class S Shares $1,456,363,406 /(3)/ $ 1,456,363,406
Class AARP Shares $ 166,974,552 /(3)/ $ 166,974,552
Class A Shares $17,571,259 /(4)/ $ 17,571,259
Class B Shares $14,136,684 /(4)/ $ 14,136,684
Class C Shares $ 4,370,690 /(4)/ $ 4,370,690
--------------------
Total Net Assets $ 1,659,416,591/(2)/
====================
Shares Outstanding
Class S Shares 54,943,128 54,943,128
Class AARP Shares 6,298,377 6,298,377
Class A Shares 1,314,428 (651,612) 662,816
Class B Shares 1,085,394 (552,135) 533,259
Class C Shares 334,830 (169,961) 164,869
Net Asset Value per Share
Class S Shares $ 26.51 $ 26.51
Class AARP Shares $ 26.51 $ 26.51
Class A Shares $ 13.37 $ 26.51
Class B Shares $ 13.02 $ 26.51
Class C Shares $ 13.05 $ 26.51
</TABLE>
(1) Assumes the Reorganization had been consummated on September 30, 2000, and
is for information purposes only. No assurance can be given as to how many
shares of Scudder Global Fund will be received by the shareholders of the
Fund on the date the Reorganization takes place, and the foregoing should
not be relied upon to reflect the number of shares of Scudder Global Fund
that actually will be received on or after such date.
(2) Pro forma combined net assets do not reflect expense reductions that would
result from implementation of Scudder Global Fund's administration fee.
(3) Represents one-time proxy, legal, accounting and other costs of the
Reorganization to be borne by Scudder Global Fund.
(4) Represents one-time proxy, legal, accounting and other costs of the
Reorganization to be borne by the Fund.
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<PAGE>
The Board of Directors unanimously recommends that the shareholders of the
Fund vote in favor of this Proposal 2.
PROPOSAL 3: RATIFICATION OR REJECTION OF THE SELECTION OF INDEPENDENT AUDITORS
The Board of Directors, including all of the Independent Directors, has
selected Ernst & Young LLP to act as independent auditors of the Fund for the
Fund's current fiscal year and recommends that shareholders ratify such
selection. However, if the Plan is approved, as described under Proposal 2,
PricewaterhouseCoopers LLP will serve as the independent auditors for the
combined fund. One or more representatives of Ernst & Young LLP are expected to
be present at the Meeting and will have an opportunity to make a statement if
they so desire. Such representatives are expected to be available to respond to
appropriate questions posed by shareholders or management.
The Board of Directors unanimously recommends that shareholders of the
Fund vote in favor of this Proposal 3.
ADDITIONAL INFORMATION
Information about the Funds
Additional information about the Corporations, the Funds and the
Reorganization has been filed with the SEC and may be obtained without charge by
writing to Scudder Investor Services, Inc., Two International Place, Boston, MA
02110-4103, or by calling 1-800-[ ].
The Corporations are subject to the informational requirements of the
Securities Exchange Act of 1934, as amended, and the 1940 Act, and in accordance
therewith, file reports, proxy material and other information about each of the
Funds with the SEC. Such reports, proxy material and other information filed by
the Acquiring Corporation, and those filed by the Acquired Corporation, can be
inspected and copied at the Public Reference Room maintained by the SEC at 450
Fifth Street, N.W., Washington, D.C. 20549 and at the following SEC Regional
Offices: Northeast Regional Office, 7 World Trade Center, Suite 1300, New York,
NY 10048; Southeast Regional Office, 1401 Brickell Avenue, Suite 200, Miami, FL
33131; Midwest Regional Office, Citicorp Center, 500 W. Madison Street, Chicago,
IL 60661-2511; Central Regional Office, 1801 California Street, Suite 4800,
Denver, CO 80202-2648; and Pacific Regional Office, 5670 Wilshire Boulevard,
11th Floor, Los Angeles, CA 90036-3648. Copies of such material can also be
obtained from the Public Reference Branch, Office of Consumer Affairs and
Information Services, Securities and Exchange Commission, 450 Fifth Street,
N.W., Washington, D.C. 20549 at prescribed rates. The SEC maintains an Internet
World Wide Web site (at http://www.sec.gov) which contains the prospectuses and
statements of additional information for the Funds, materials that are
incorporated by reference into the prospectuses and statements of additional
information, and other information about the Corporations and the Funds.
General
Proxy Solicitation. Proxy solicitation costs will be considered
Reorganization expenses and will be allocated accordingly. See "The Proposed
Transaction - Board Approval of the Proposed Transaction." In addition to
solicitation by mail, certain officers and representatives of the Acquired
Corporation, officers and employees of Scudder Kemper and certain financial
services firms and their
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<PAGE>
representatives, who will receive no extra compensation for their services, may
solicit proxies by telephone, telegram or personally.
Any shareholder of the Fund giving a proxy has the power to revoke it by
mail (addressed to the Secretary at the principal executive office of the Fund,
c/o Scudder Kemper Investments, Inc., at the address for the Fund shown at the
beginning of this Proxy Statement/Prospectus) or in person at the Meeting, by
executing a superseding proxy or by submitting a notice of revocation to the
Fund. All properly executed proxies received in time for the Meeting will be
voted as specified in the proxy or, if no specification is made, in favor of
each Proposal.
The presence at any shareholders' meeting, in person or by proxy, of the
holders of at least one-third of the shares of the Acquired Corporation (for a
corporation-wide vote) or the Fund (for a fund-wide vote) entitled to be cast
shall be necessary and sufficient to constitute a quorum for the transaction of
business. In the event that the necessary quorum to transact business or the
vote required to approve any Proposal is not obtained at the Meeting, the
persons named as proxies may propose one or more adjournments of the Meeting in
accordance with applicable law to permit further solicitation of proxies with
respect to that Proposal. Any such adjournment as to a matter will require the
affirmative vote of the holders of a majority of the Acquired Corporation's (for
a corporation-wide vote) or the Fund's (for a fund-wide vote) shares present in
person or by proxy at the Meeting. The persons named as proxies will vote in
favor of any such adjournment those proxies which they are entitled to vote in
favor of that Proposal and will vote against any such adjournment those proxies
to be voted against that Proposal. For purposes of determining the presence of a
quorum for transacting business at the Meeting, abstentions and broker "non-
votes" will be treated as shares that are present but which have not been voted.
Broker non-votes are proxies received by the Fund from brokers or nominees when
the broker or nominee has neither received instructions from the beneficial
owner or other persons entitled to vote nor has discretionary power to vote on a
particular matter. Accordingly, shareholders are urged to forward their voting
instructions promptly.
The election of the Directors under Proposal 1 requires the affirmative
vote of a plurality of the shares of the Acquired Corporation voting on such
election. Approval of Proposal 2 requires the affirmative vote of the holders of
a majority of the Fund's shares outstanding and entitled to vote thereon.
Approval of Proposal 3 requires the affirmative vote of a majority of the shares
of the Fund voting at the Meeting. Abstentions and broker non-votes will not be
counted in favor of, but will have no other effect on, Proposals 1 and 3, and
will have the effect of a "no" vote on Proposal 2.
Holders of record of the shares of the Fund at the close of business on
March 5, 2001 will be entitled to one vote per share on all business of the
Meeting. As of February 5, 2001, there were [ ] Class A shares, [
] Class B shares and [ ] Class C shares of the Fund outstanding.
[As of December 31, 2000, the officers and Directors of the Acquiring
Corporation as a group owned beneficially less than 1% of the outstanding shares
of Scudder Global Fund.] Appendix 2 hereto sets forth the beneficial owners of
more than 5% of each class of each Fund's shares, as well as the beneficial
owners of more than 5% of each class of shares of each other series of the
Acquired Corporation. To the best of each Corporation's knowledge, as of
December 31, 2000, no person owned beneficially more than 5% of any class of
either Fund's outstanding shares or the shares of any other series of the
Acquired Corporation, except as stated on Appendix 2.
Shareholder Communications Corporation ("SCC") has been engaged to assist
in the solicitation of proxies, at an estimated cost of $[ ]. As the
Meeting date approaches, certain shareholders of the Fund may receive a
telephone call from a representative of SCC if their votes have not yet been
received. Authorization to permit SCC to execute proxies may be obtained by
telephonic or electronically
-31-
<PAGE>
transmitted instructions from shareholders of the Fund. Proxies that are
obtained telephonically will be recorded in accordance with the procedures
described below. The Directors believe that these procedures are reasonably
designed to ensure that both the identity of the shareholder casting the vote
and the voting instructions of the shareholder are accurately determined.
In all cases where a telephonic proxy is solicited, the SCC representative
is required to ask for each shareholder's full name and address, or the last
four digits of the shareholder's social security or employer identification
number, or both, and to confirm that the shareholder has received the proxy
materials in the mail. If the shareholder is a corporation or other entity, the
SCC representative is required to ask for the person's title and confirmation
that the person is authorized to direct the voting of the shares. If the
information solicited agrees with the information provided to SCC, then the SCC
representative has the responsibility to explain the process, read the Proposals
on the proxy card(s), and ask for the shareholder's instructions on the
Proposals. Although the SCC representative is permitted to answer questions
about the process, he or she is not permitted to recommend to the shareholder
how to vote, other than to read any recommendation set forth in the Proxy
Statement/Prospectus. SCC will record the shareholder's instructions on the
card. Within 72 hours, the shareholder will be sent a letter or mailgram to
confirm his or her vote and asking the shareholder to call SCC immediately if
his or her instructions are not correctly reflected in the confirmation.
Shareholders may also provide their voting instructions through telephone
touch-tone voting or Internet voting. These options require shareholders to
input a control number which is located on each voting instruction card. After
inputting this number, shareholders will be prompted to provide their voting
instructions on the Proposals. Shareholders will have an opportunity to review
their voting instructions and make any necessary changes before submitting their
voting instructions and terminating their telephone call or Internet link.
Shareholders who vote on the Internet, in addition to confirming their voting
instructions prior to submission, will also receive an e-mail confirming their
instructions.
If a shareholder wishes to participate in the Meeting, but does not wish to
give a proxy by telephone or electronically, the shareholder may still submit
the proxy card(s) originally sent with the Proxy Statement/Prospectus or attend
in person. Should shareholders require additional information regarding the
proxy or replacement proxy card(s), they may contact SCC toll-free at 1-800-[ ].
Any proxy given by a shareholder is revocable until voted at the Meeting.
Shareholder Proposals for Subsequent Meetings. Shareholders wishing to
submit proposals for inclusion in a proxy statement for a shareholder meeting
subsequent to the Meeting, if any, should send their written proposals to the
Secretary of the Acquired Corporation, c/o Scudder Kemper Investments, Inc., 222
South Riverside Plaza, Chicago, Illinois 60606, within a reasonable time before
the solicitation of proxies for such meeting. The timely submission of a
proposal does not guarantee its inclusion.
Other Matters to Come Before the Meeting. The Board is not aware of any
matters that will be presented for action at the Meeting other than the matters
described in this material. Should any other matters requiring a vote of
shareholders arise, the proxy in the accompanying form will confer upon the
person or persons entitled to vote the shares represented by such proxy the
discretionary authority to vote the shares as to any such other matters in
accordance with their best judgment in the interest of the Acquired Corporation
and/or the Fund.
PLEASE COMPLETE, SIGN AND RETURN THE ENCLOSED PROXY CARD(S) (OR TAKE ADVANTAGE
OF AVAILABLE ELECTRONIC OR TELEPHONIC VOTING PROCEDURES) PROMPTLY. NO POSTAGE
IS REQUIRED IF MAILED IN THE UNITED STATES.
By Order of the Board,
/s/ Philip J. Collora
Philip J. Collora
Secretary
-32-
<PAGE>
INDEX OF EXHIBITS AND APPENDICES
EXHIBIT A: FORM OF AGREEMENT AND PLAN OF REORGANIZATION......
EXHIBIT B: MANAGEMENT'S DISCUSSION OF SCUDDER
GLOBAL FUND'S PERFORMANCE.....................................
APPENDIX 1. DIRECTOR AND NOMINEE SHAREHOLDINGS................
APPENDIX 2: BENEFICIAL OWNERS OF FUND SHARES..................
-33-
<PAGE>
EXHIBIT A
FORM OF AGREEMENT AND PLAN OF REORGANIZATION
THIS AGREEMENT AND PLAN OF REORGANIZATION (the "Agreement") is made as
of this [ ] day of [ ], 2001, by and among Global/International Fund, Inc.
(the "Acquiring Corporation"), a Maryland corporation, on behalf of Scudder
Global Fund (the "Acquiring Fund"), a separate series of the Acquiring
Corporation, Kemper Global/International Series, Inc. (the "Acquired
Corporation"), a Maryland corporation, on behalf of Kemper Global Blue Chip Fund
(the "Acquired Fund" and, together with the Acquiring Fund, each a "Fund" and
collectively the "Funds"), a separate series of the Acquired Corporation, and
Scudder Kemper Investments, Inc. ("Scudder Kemper"), investment adviser to the
Funds (for purposes of Paragraph 10.2 of the Agreement only). The principal
place of business of the Acquiring Corporation is 345 Park Avenue, New York, New
York 10154. The principal place of business of the Acquired Corporation is 222
South Riverside Plaza, Chicago, Illinois 60606.
This Agreement is intended to be and is adopted as a plan of
reorganization and liquidation within the meaning of Section 368(a) of the
Internal Revenue Code of 1986, as amended (the "Code"). The reorganization (the
"Reorganization") will consist of the transfer of all or substantially all of
the assets of the Acquired Fund to the Acquiring Fund in exchange solely for
Class A, Class B and Class C voting shares of capital stock ($.01 par value per
share) of the Acquiring Fund (the "Acquiring Fund Shares"), the assumption by
the Acquiring Fund of all of the liabilities of the Acquired Fund and the
distribution of the Acquiring Fund Shares to the Class A, Class B and Class C
shareholders of the Acquired Fund in complete liquidation of the Acquired Fund
as provided herein, all upon the terms and conditions hereinafter set forth in
this Agreement.
NOW, THEREFORE, in consideration of the premises and of the covenants
and agreements hereinafter set forth, the parties hereto covenant and agree as
follows:
1. TRANSFER OF ASSETS OF THE ACQUIRED FUND TO THE ACQUIRING FUND IN
EXCHANGE FOR ACQUIRING FUND SHARES, THE ASSUMPTION OF ALL ACQUIRED
FUND LIABILITIES AND THE LIQUIDATION OF THE ACQUIRED FUND
1.1. Subject to the terms and conditions herein set forth and on the
basis of the representations and warranties contained herein, the Acquired Fund
agrees to transfer to the Acquiring Fund all or substantially all of the
Acquired Fund's assets as set forth in section 1.2, and the Acquiring Fund
agrees in exchange therefor (i) to deliver to the Acquired Fund that number of
full and fractional Class A, Class B and Class C Acquiring Fund Shares
determined by dividing the value of the Acquired Fund's assets net of any
liabilities of the Acquired Fund with respect to the Class A, Class B and Class
C shares of the Acquired Fund, computed in the manner and as of the time and
date set forth in section 2.1, by the net asset value of one Acquiring Fund
Share of the corresponding class, computed in the manner and as of the time and
date set forth in section 2.2; and (ii) to assume all of the liabilities of the
Acquired Fund, including, but not limited to, any deferred compensation to the
Acquired Fund board members. All Acquiring Fund Shares delivered to the Acquired
Fund shall be delivered at net asset value without sales load, commission or
other similar fee being imposed. Such transactions shall take place at the
closing provided for in section 3.1 (the "Closing").
<PAGE>
1.2. The assets of the Acquired Fund to be acquired by the
Acquiring Fund (the "Assets") shall consist of all assets, including, without
limitation, all cash, cash equivalents, securities, commodities and futures
interests and dividends or interest or other receivables that are owned by the
Acquired Fund and any deferred or prepaid expenses shown on the unaudited
statement of assets and liabilities of the Acquired Fund prepared as of the
effective time of the Closing in accordance with generally accepted accounting
principles ("GAAP") applied consistently with those of the Acquired Fund's most
recent audited balance sheet. The Assets shall constitute at least 90% of the
fair market value of the net assets, and at least 70% of the fair market value
of the gross assets, held by the Acquired Fund immediately before the Closing
(excluding for these purposes assets used to pay the dividends and other
distributions paid pursuant to section 1.4).
1.3. The Acquired Fund will endeavor to discharge all of its known
liabilities and obligations prior to the Closing Date as defined in section 3.6.
1.4. On or as soon as practicable prior to the Closing Date as
defined in section 3.1, the Acquired Fund will declare and pay to its
shareholders of record one or more dividends and/or other distributions so that
it will have distributed substantially all of its investment company taxable
income (computed without regard to any deduction for dividends paid) and
realized net capital gain, if any, for the current taxable year through the
Closing Date.
1.5. Immediately after the transfer of Assets provided for in
section 1.1, the Acquired Fund will distribute to the Acquired Fund's
shareholders of record with respect to each class of its shares (the "Acquired
Fund Shareholders"), determined as of the Valuation Time (as defined in section
2.1), on a pro rata basis within that class, the Acquiring Fund Shares of the
same class received by the Acquired Fund pursuant to section 1.1 and will
completely liquidate. Such distribution and liquidation will be accomplished
with respect to each class of the Acquired Fund by the transfer of the Acquiring
Fund Shares then credited to the account of the Acquired Fund on the books of
the Acquiring Fund to open accounts on the share records of the Acquiring Fund
in the names of the Acquired Fund Shareholders. The Acquiring Fund shall have
no obligation to inquire as to the validity, propriety or correctness of such
records, but shall assume that such transaction is valid, proper and correct.
The aggregate net asset value of Class A, Class B and Class C Acquiring Fund
Shares to be so credited to the Class A, Class B and Class C Acquired Fund
Shareholders shall, with respect to each class, be equal to the aggregate net
asset value of the Acquired Fund shares of the same class owned by such
shareholders as of the Valuation Time. All issued and outstanding shares of the
Acquired Fund will simultaneously be cancelled on the books of the Acquired
Fund, although share certificates representing interests in Class A, Class B and
Class C shares of the Acquired Fund will represent a number of Acquiring Fund
Shares after the Closing Date as determined in accordance with section 2.3. The
Acquiring Fund will not issue certificates representing Acquiring Fund Shares in
connection with such exchange.
1.6. Ownership of Acquiring Fund Shares will be shown on the books
of the Acquiring Fund. Shares of the Acquiring Fund will be issued in the
manner described in the Acquiring Fund's then-current prospectus and statement
of additional information.
1.7. Any reporting responsibility of the Acquired Fund including,
without limitation, the responsibility for filing of regulatory reports, tax
returns, or other documents with the Securities and Exchange Commission (the
"Commission"), any state securities commission, and any federal, state or local
tax authorities or any other relevant regulatory authority, is and shall remain
the responsibility of the Acquired Fund.
<PAGE>
1.8. All books and records of the Acquired Fund, including all
books and records required to be maintained under the Investment Company Act of
1940, as amended (the "1940 Act"), and the rules and regulations thereunder,
shall be available to the Acquiring Fund from and after the Closing Date and
shall be turned over to the Acquiring Fund as soon as practicable following the
Closing Date.
2. VALUATION
2.1. The value of the Assets shall be computed as of the close of
regular trading on The New York Stock Exchange, Inc. (the "NYSE") on the
business day immediately preceding the Closing Date, as defined in section 3.1
(the "Valuation Time") after the declaration and payment of any dividends and/or
other distributions on that date, using the valuation procedures set forth in
the Acquiring Corporation's Charter, as amended, and then-current prospectus or
statement of additional information, copies of which have been delivered to the
Acquired Fund.
2.2. The net asset value of a Class A, Class B or Class C Acquiring
Fund Share shall be the net asset value per share computed with respect to that
class as of the Valuation Time using the valuation procedures referred to in
section 2.1. Notwithstanding anything to the contrary contained in this
Agreement, in the event that, as of the Valuation Time, there are no Class A,
Class B and/or Class C Acquiring Fund Shares issued and outstanding, then, for
purposes of this Agreement, the per share net asset value of a Class A, Class B
and/or Class C share, as applicable, shall be equal to the net asset value of
one Class S Acquiring Fund Share.
2.3. The number of the Class A, Class B and Class C Acquiring Fund
Shares to be issued (including fractional shares, if any) in exchange for the
Assets shall be determined with respect to each such class by dividing the value
of the Assets with respect to Class A, Class B and Class C shares of the
Acquired Fund, as the case may be, determined in accordance with section 2.1 by
the net asset value of an Acquiring Fund Share of the same class determined in
accordance with section 2.2.
2.4. All computations of value hereunder shall be made by or under
the direction of each Fund's respective accounting agent, if applicable, in
accordance with its regular practice and the requirements of the 1940 Act and
shall be subject to confirmation by each Fund's respective independent
accountants upon the reasonable request of the other Fund.
3. CLOSING AND CLOSING DATE
3.1. The Closing of the transactions contemplated by this Agreement
shall be June 18, 2001, or such later date as the parties may agree in writing
(the "Closing Date"). All acts taking place at the Closing shall be deemed to
take place simultaneously as of 9:00 a.m., Eastern time, on the Closing Date,
unless otherwise agreed to by the parties. The Closing shall be held at the
offices of Dechert, Ten Post Office Square - South, Boston, MA 02109, or at such
other place and time as the parties may agree.
3.2. The Acquired Fund shall deliver to Acquiring Fund on the
Closing Date a schedule of Assets.
3.3. Brown Brothers Harriman & Company, custodian for the Acquired
Fund, shall deliver at the Closing a certificate of an authorized officer
stating that (a) the Assets shall have been delivered in proper form to Brown
Brothers Harriman & Company, custodian for the Acquiring Fund, prior to or on
the Closing Date and (b) all necessary taxes in connection with the delivery of
the Assets, including all
<PAGE>
applicable federal and state stock transfer stamps, if any, have been paid or
provision for payment has been made. The Acquired Fund's portfolio securities
represented by a certificate or other written instrument shall be presented by
the custodian for the Acquired Fund to the custodian for the Acquiring Fund for
examination no later than five business days preceding the Closing Date and
transferred and delivered by the Acquired Fund as of the Closing Date by the
Acquired Fund for the account of Acquiring Fund duly endorsed in proper form for
transfer in such condition as to constitute good delivery thereof. The Acquired
Fund's portfolio securities and instruments deposited with a securities
depository, as defined in Rule 17f-4 under the 1940 Act, shall be delivered as
of the Closing Date by book entry in accordance with the customary practices of
such depositories and the custodian for the Acquiring Fund. The cash to be
transferred by the Acquired Fund shall be delivered by wire transfer of federal
funds on the Closing Date.
3.4. State Street Bank and Trust Company ("State Street"), as
transfer agent for the Acquired Fund, on behalf of the Acquired Fund, shall
deliver at the Closing a certificate of an authorized officer stating that its
records contain the names and addresses of the Acquired Fund Shareholders and
the number and percentage ownership (to three decimal places) of outstanding
Class A, Class B and Class C Acquired Fund shares owned by each such shareholder
immediately prior to the Closing. The Acquiring Fund shall issue and deliver a
confirmation evidencing the Acquiring Fund Shares to be credited on the Closing
Date to the Acquired Fund or provide evidence satisfactory to the Acquired Fund
that such Acquiring Fund Shares have been credited to the Acquired Fund's
account on the books of the Acquiring Fund. At the Closing, each party shall
deliver to the other such bills of sale, checks, assignments, share
certificates, if any, receipts or other documents as such other party or its
counsel may reasonably request to effect the transactions contemplated by this
Agreement.
3.5. In the event that immediately prior to the Valuation Time (a)
the NYSE or another primary trading market for portfolio securities of the
Acquiring Fund or the Acquired Fund shall be closed to trading or trading
thereupon shall be restricted, or (b) trading or the reporting of trading on
such Exchange or elsewhere shall be disrupted so that, in the judgment of the
Board members of either party to this Agreement, accurate appraisal of the value
of the net assets with respect to the Class A, Class B and Class C shares of
the Acquiring Fund or the Acquired Fund is impracticable, the Closing Date shall
be postponed until the first business day after the day when trading shall have
been fully resumed and reporting shall have been restored.
3.6. The liabilities of the Acquired Fund shall include all of the
Acquired Fund's liabilities, debts, obligations, and duties of whatever kind or
nature, whether absolute, accrued, contingent, or otherwise, whether or not
arising in the ordinary course of business, whether or not determinable at the
Closing Date, and whether or not specifically referred to in this Agreement
including but not limited to any deferred compensation to the Acquired Fund's
board members.
4. REPRESENTATIONS AND WARRANTIES
4.1. The Acquired Corporation, on behalf of the Acquired Fund,
represents and warrants to the Acquiring Fund as follows:
(a) The Acquired Corporation is a corporation duly organized
and validly existing under the laws of the State of Maryland with power under
the Acquired Corporation's Charter, as amended, to own all of its properties and
assets and to carry on its business as it is now being conducted and, subject to
approval of shareholders of the Acquired Fund, to carry out the Agreement. The
Acquired
<PAGE>
Fund is a separate series of the Acquired Corporation duly designated in
accordance with the applicable provisions of the Acquired Corporation's Charter.
The Acquired Corporation and Acquired Fund are qualified to do business in all
jurisdictions in which they are required to be so qualified, except
jurisdictions in which the failure to so qualify would not have material adverse
effect on the Acquired Corporation or Acquired Fund. The Acquired Fund has all
material federal, state and local authorizations necessary to own all of the
properties and assets and to carry on its business as now being conducted,
except authorizations which the failure to so obtain would not have a material
adverse effect on the Acquired Fund;
(b) The Acquired Corporation is registered with the Commission as an
open-end management investment company under the 1940 Act, and such registration
is in full force and effect and the Acquired Fund is in compliance in all
material respects with the 1940 Act and the rules and regulations thereunder;
(c) No consent, approval, authorization, or order of any court or
governmental authority is required for the consummation by the Acquired Fund of
the transactions contemplated herein, except such as have been obtained under
the Securities Act of 1933, as amended (the "1933 Act"), the Securities Exchange
Act of 1934, as amended (the "1934 Act"), and the 1940 Act and such as may be
required by state securities laws;
(d) Other than with respect to contracts entered into in connection
with the portfolio management of the Acquired Fund which shall terminate on or
prior to the Closing Date, the Acquired Corporation is not, and the execution,
delivery and performance of this Agreement by the Acquired Corporation will not
result (i) in violation of Maryland law or of the Acquired Corporation's
Charter, as amended, or By-Laws, (ii) in a violation or breach of, or constitute
a default under, any material agreement, indenture, instrument, contract, lease
or other undertaking to which the Acquired Fund is a party or by which it is
bound, and the execution, delivery and performance of this Agreement by the
Acquired Fund will not result in the acceleration of any obligation, or the
imposition of any penalty, under any agreement, indenture, instrument, contract,
lease, judgment or decree to which the Acquired Fund is a party or by which it
is bound, or (iii) in the creation or imposition of any lien, charge or
encumbrance on any property or assets of the Acquired Fund;
(e) No material litigation or administrative proceeding or
investigation of or before any court or governmental body is presently pending
or to its knowledge threatened against the Acquired Fund or any properties or
assets held by it. The Acquired Fund knows of no facts which might form the
basis for the institution of such proceedings which would materially and
adversely affect its business and is not a party to or subject to the provisions
of any order, decree or judgment of any court or governmental body which
materially and adversely affects its business or its ability to consummate the
transactions herein contemplated;
(f) The Statements of Assets and Liabilities, Operations, and Changes
in Net Assets, the Financial Highlights, and the Investment Portfolio of the
Acquired Fund at and for the fiscal year ended October 31, [1999], have been
audited by Ernst & Young LLP, independent auditors, and are in accordance with
GAAP consistently applied, and such statements (a copy of each of which has been
furnished to the Acquiring Fund) present fairly, in all material respects, the
financial position of the Acquired Fund as of such date in accordance with GAAP,
and there are no known contingent liabilities of the Acquired Fund required to
be reflected on a balance sheet (including the notes thereto) in accordance with
GAAP as of such date not disclosed therein;
<PAGE>
(g) Since October 31, [1999], there has not been any material adverse
change in the Acquired Fund's financial condition, assets, liabilities or
business other than changes occurring in the ordinary course of business, or any
incurrence by the Acquired Fund of indebtedness maturing more than one year from
the date such indebtedness was incurred except as otherwise disclosed to and
accepted in writing by the Acquiring Fund. For purposes of this subsection (g),
a decline in net asset value per share of the Acquired Fund due to declines in
market values of securities in the Acquired Fund's portfolio, the discharge of
Acquired Fund liabilities, or the redemption of Acquired Fund shares by Acquired
Fund Shareholders shall not constitute a material adverse change;
(h) At the date hereof and at the Closing Date, all federal and other
tax returns and reports of the Acquired Fund required by law to have been filed
by such dates (including any extensions) shall have been filed and are or will
be correct in all material respects, and all federal and other taxes shown as
due or required to be shown as due on said returns and reports shall have been
paid or provision shall have been made for the payment thereof, and, to the best
of the Acquired Fund's knowledge, no such return is currently under audit and no
assessment has been asserted with respect to such returns;
(i) For each taxable year of its operation (including the taxable
year ending on the Closing Date), the Acquired Fund has met the requirements of
Subchapter M of the Code for qualification as a regulated investment company and
has elected to be treated as such, has been eligible to and has computed its
federal income tax under Section 852 of the Code, and will have distributed all
of its investment company taxable income and net capital gain (as defined in the
Code) that has accrued through the Closing Date;
(j) All issued and outstanding shares of the Acquired Fund (i) have
been offered and sold in every state and the District of Columbia in compliance
in all material respects with applicable registration requirements of the 1933
Act and state securities laws, (ii) are, and on the Closing Date will be, duly
and validly issued and outstanding, fully paid and non-assessable and not
subject to preemptive or dissenter's rights, and (iii) will be held at the time
of the Closing by the persons and in the amounts set forth in the records of
State Street, as provided in section 3.4. The Acquired Fund does not have
outstanding any options, warrants or other rights to subscribe for or purchase
any of the Acquired Fund shares, nor is there outstanding any security
convertible into any of the Acquired Fund shares;
(k) At the Closing Date, the Acquired Fund will have good and
marketable title to the Acquired Fund's assets to be transferred to the
Acquiring Fund pursuant to section 1.2 and full right, power, and authority to
sell, assign, transfer and deliver such assets hereunder free of any liens or
other encumbrances, except those liens or encumbrances as to which the Acquiring
Fund has received notice at or prior to the Closing, and upon delivery and
payment for such assets, the Acquiring Fund will acquire good and marketable
title thereto, subject to no restrictions on the full transfer thereof,
including such restrictions as might arise under the 1933 Act and the 1940 Act,
except those restrictions as to which the Acquiring Fund has received notice and
necessary documentation at or prior to the Closing;
(l) The execution, delivery and performance of this Agreement will
have been duly authorized prior to the Closing Date by all necessary action on
the part of the Board members of the Acquired Corporation (including the
determinations required by Rule 17a-8(a) under the 1940 Act), and, subject to
the approval of the Acquired Fund Shareholders, this Agreement constitutes a
valid and binding obligation of the Acquired Corporation, on behalf of the
Acquired Fund, enforceable in accordance with its terms, subject, as to
enforcement, to bankruptcy, insolvency, fraudulent transfer, reorganization,
moratorium and other laws relating to or affecting creditors' rights and to
general equity principles;
<PAGE>
(m) The information to be furnished by the Acquired Fund for use in
applications for orders, registration statements or proxy materials or for use
in any other document filed or to be filed with any federal, state or local
regulatory authority (including the National Association of Securities Dealers,
Inc. (the "NASD")), which may be necessary in connection with the transactions
contemplated hereby, shall be accurate and complete in all material respects and
shall comply in all material respects with federal securities and other laws and
regulations applicable thereto;
(n) The current prospectus and statement of additional information of
the Acquired Fund conform in all material respects to the applicable
requirements of the 1933 Act and the 1940 Act and the rules and regulations of
the Commission thereunder and do not include any untrue statement of a material
fact or omit to state any material fact required to be stated therein or
necessary to make the statements therein, in light of the circumstances under
which they were made, not materially misleading; and
(o) The proxy statement of the Acquired Fund to be included in the
Registration Statement referred to in section 5.7 (the "Proxy Statement"),
insofar as it relates to the Acquired Fund, will, on the effective date of the
Registration Statement and on the Closing Date, (i) comply in all material
respects with the provisions and Regulations of the 1933 Act, 1934 Act and 1940
Act, as applicable, and (ii) not contain any untrue statement of a material fact
or omit to state a material fact required to be stated therein or necessary to
make the statements therein, in light of the circumstances under which such
statements are made, not materially misleading; provided, however, that the
representations and warranties in this section shall not apply to statements in
or omissions from the Proxy Statement and the Registration Statement made in
reliance upon and in conformity with information that was furnished or should
have been furnished by the Acquiring Fund for use therein.
4.2. The Acquiring Corporation, on behalf of the Acquiring Fund, represents
and warrants to the Acquired Fund as follows:
(a) The Acquiring Corporation is a corporation duly organized and
validly existing under the laws of the State of Maryland with power under the
Acquiring Corporation's Charter, as amended, to own all of its properties and
assets and to carry on its business as it is now being conducted and, subject to
the approval of shareholders of the Acquired Fund, to carry out the Agreement.
The Acquiring Fund is a separate series of the Acquiring Corporation duly
designated in accordance with the applicable provisions of the Acquiring
Corporation's Charter. The Acquiring Corporation and Acquiring Fund are
qualified to do business in all jurisdictions in which they are required to be
so qualified, except jurisdictions in which the failure to so qualify would not
have material adverse effect on the Acquiring Corporation or Acquiring Fund.
The Acquiring Fund has all material federal, state and local authorizations
necessary to own all of the properties and assets and to carry on its business
as now being conducted, except authorizations which the failure to so obtain
would not have a material adverse effect on the Acquiring Fund;
(b) The Acquiring Corporation is registered with the Commission as an
open-end management investment company under the 1940 Act, and such registration
is in full force and effect and the Acquiring Fund is in compliance in all
material respects with the 1940 Act and the rules and regulations thereunder;
(c) No consent, approval, authorization, or order of any court or
governmental authority is required for the consummation by the Acquiring Fund of
the transactions contemplated
<PAGE>
herein, except such as have been obtained under the 1933 Act, the 1934 Act and
the 1940 Act and such as may be required by state securities laws;
(d) The Acquiring Corporation is not, and the execution, delivery and
performance of this Agreement by the Acquiring Corporation will not result (i)
in violation of Maryland law or of the Acquiring Corporation's Charter, as
amended, or By-Laws, or (ii) in a violation or breach of, or constitute a
default under, any material agreement, indenture, instrument, contract, lease or
other undertaking known to counsel to which the Acquiring Fund is a party or by
which it is bound, and the execution, delivery and performance of this Agreement
by the Acquiring Fund will not result in the acceleration of any obligation, or
the imposition of any penalty, under any agreement, indenture, instrument,
contract, lease, judgment or decree to which the Acquiring Fund is a party or by
which it is bound, or (iii) in the creation or imposition of any lien, charge or
encumbrance on any property or assets of the Acquiring Fund;
(e) No material litigation or administrative proceeding or
investigation of or before any court or governmental body is presently pending
or to its knowledge threatened against the Acquiring Fund or any properties or
assets held by it. The Acquiring Fund knows of no facts which might form the
basis for the institution of such proceedings which would materially and
adversely affect its business and is not a party to or subject to the provisions
of any order, decree or judgment of any court or governmental body which
materially and adversely affects its business or its ability to consummate the
transactions herein contemplated;
(f) The Statements of Assets and Liabilities, Operations, and Changes
in Net Assets, the Financial Highlights, and the Investment Portfolio of the
Acquiring Fund at and for the fiscal year ended August 31, 2000, have been
audited by PricewaterhouseCoopers LLP, independent accountants, and are in
accordance with GAAP consistently applied, and such statements (a copy of each
of which has been furnished to the Acquired Fund) present fairly, in all
material respects, the financial position of the Acquiring Fund as of such date
in accordance with GAAP, and there are no known contingent liabilities of the
Acquiring Fund required to be reflected on a balance sheet (including the notes
thereto) in accordance with GAAP as of such date not disclosed therein;
(g) Since August 31, 2000, there has not been any material adverse
change in the Acquiring Fund's financial condition, assets, liabilities or
business other than changes occurring in the ordinary course of business, or any
incurrence by the Acquiring Fund of indebtedness maturing more than one year
from the date such indebtedness was incurred except as otherwise disclosed to
and accepted in writing by the Acquired Fund. For purposes of this subsection
(g), a decline in net asset value per share of the Acquiring Fund due to
declines in market values of securities in the Acquiring Fund's portfolio, the
discharge of Acquiring Fund liabilities, or the redemption of Acquiring Fund
shares by Acquiring Fund shareholders shall not constitute a material adverse
change;
(h) At the date hereof and at the Closing Date, all federal and other
tax returns and reports of the Acquiring Fund required by law to have been filed
by such dates (including any extensions) shall have been filed and are or will
be correct in all material respects, and all federal and other taxes shown as
due or required to be shown as due on said returns and reports shall have been
paid or provision shall have been made for the payment thereof, and, to the best
of the Acquiring Fund's knowledge, no such return is currently under audit and
no assessment has been asserted with respect to such returns;
(i) For each taxable year of its operation, the Acquiring Fund has
met the requirements of Subchapter M of the Code for qualification as a
regulated investment company and has
<PAGE>
elected to be treated as such, has been eligible to and has computed its federal
income tax under Section 852 of the Code, and will do so for the taxable year
including the Closing Date;
(j) All issued and outstanding shares of the Acquiring Fund (i) have
been offered and sold in every state and the District of Columbia in compliance
in all material respects with applicable registration requirements of the 1933
Act and state securities laws and (ii) are, and on the Closing Date will be,
duly and validly issued and outstanding, fully paid and non-assessable, and not
subject to preemptive or dissenter's rights. The Acquiring Fund does not have
outstanding any options, warrants or other rights to subscribe for or purchase
any of the Acquiring Fund shares, nor is there outstanding any security
convertible into any of the Acquiring Fund shares;
(k) The Acquiring Fund Shares to be issued and delivered to the
Acquired Fund, for the account of the Acquired Fund Shareholders, pursuant to
the terms of this Agreement, will at the Closing Date have been duly authorized
and, when so issued and delivered, will be duly and validly issued and
outstanding Acquiring Fund Shares, and will be fully paid and non-assessable
(recognizing that, under Massachusetts law, Acquiring Fund Shareholders, under
certain circumstances, could be held personally liable for the obligations of
the Acquiring Fund);
(l) At the Closing Date, the Acquiring Fund will have good and
marketable title to the Acquiring Fund's assets, free of any liens or other
encumbrances, except those liens or encumbrances as to which the Acquired Fund
has received notice at or prior to the Closing;
(m) The execution, delivery and performance of this Agreement will
have been duly authorized prior to the Closing Date by all necessary action on
the part of the Board members of the Acquiring Corporation (including the
determinations required by Rule 17a-8(a) under the 1940 Act) and this Agreement
will constitute a valid and binding obligation of the Acquiring Corporation, on
behalf of the Acquiring Fund, enforceable in accordance with its terms, subject,
as to enforcement, to bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium and other laws relating to or affecting creditors'
rights and to general equity principles;
(n) The information to be furnished by the Acquiring Fund for use in
applications for orders, registration statements or proxy materials or for use
in any other document filed or to be filed with any federal, state or local
regulatory authority (including the NASD), which may be necessary in connection
with the transactions contemplated hereby, shall be accurate and complete in all
material respects and shall comply in all material respects with federal
securities and other laws and regulations applicable thereto;
(o) The current prospectus and statement of additional information of
the Acquiring Fund conform in all material respects to the applicable
requirements of the 1933 Act and the 1940 Act and the rules and regulations of
the Commission thereunder and do not include any untrue statement of a material
fact or omit to state any material fact required to be stated therein or
necessary to make the statements therein, in light of the circumstances under
which they were made, not materially misleading;
(p) The Proxy Statement to be included in the Registration Statement,
only insofar as it relates to the Acquiring Fund, will, on the effective date of
the Registration Statement and on the Closing Date, (i) comply in all material
respects with the provisions and Regulations of the 1933 Act, 1934 Act, and 1940
Act and (ii) not contain any untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary to make the
statements therein, in light of the
<PAGE>
circumstances under which such statements were made, not materially misleading;
provided, however, that the representations and warranties in this section shall
not apply to statements in or omissions from the Proxy Statement and the
Registration Statement made in reliance upon and in conformity with information
that was furnished or should have been furnished by the Acquired Fund for use
therein; and
(q) The Acquiring Fund agrees to use all reasonable efforts
to obtain the approvals and authorizations required by the 1933 Act, the 1940
Act and such of the state securities laws as may be necessary in order to
continue its operations after the Closing Date.
5. COVENANTS OF THE ACQUIRING FUND AND THE ACQUIRED FUND
5.1. The Acquiring Fund and the Acquired Fund each covenants to
operate its business in the ordinary course between the date hereof and the
Closing Date, it being understood that (a) such ordinary course of business will
include (i) the declaration and payment of customary dividends and other
distributions and (ii) such changes as are contemplated by the Funds' normal
operations; and (b) each Fund shall retain exclusive control of the composition
of its portfolio until the Closing Date. No party shall take any action that
would, or reasonably would be expected to, result in any of its representations
and warranties set forth in this Agreement being or becoming untrue in any
material respect. The Acquired Fund and Acquiring Fund covenant and agree to
coordinate the respective portfolios of the Acquired Fund and Acquiring Fund
from the date of the Agreement up to and including the Closing Date in order
that at Closing, when the Assets are added to the Acquiring Fund's portfolio,
the resulting portfolio will meet the Acquiring Fund's investment objective,
policies and restrictions, as set forth in the Acquiring Fund's Prospectus, a
copy of which has been delivered to the Acquired Fund.
5.2. Upon reasonable notice, the Acquiring Fund's officers and
agents shall have reasonable access to the Acquired Fund's books and records
necessary to maintain current knowledge of the Acquired Fund and to ensure that
the representations and warranties made by the Acquired Fund are accurate.
5.3. The Acquired Fund covenants to call a meeting of the Acquired
Fund Shareholders entitled to vote thereon to consider and act upon this
Agreement and to take all other reasonable action necessary to obtain approval
of the transactions contemplated herein. Such meeting shall be scheduled for no
later than May 24, 2001.
5.4. The Acquired Fund covenants that the Acquiring Fund Shares to
be issued hereunder are not being acquired for the purpose of making any
distribution thereof other than in accordance with the terms of this Agreement.
5.5. The Acquired Fund covenants that it will assist the Acquiring
Fund in obtaining such information as the Acquiring Fund reasonably requests
concerning the beneficial ownership of the Acquired Fund shares.
5.6. Subject to the provisions of this Agreement, the Acquiring
Fund and the Acquired Fund will each take, or cause to be taken, all actions,
and do or cause to be done, all things reasonably necessary, proper, and/or
advisable to consummate and make effective the transactions contemplated by this
Agreement.
<PAGE>
5.7. Each Fund covenants to prepare in compliance with the 1933
Act, the 1934 Act and the 1940 Act the Registration Statement on Form N-14 (the
"Registration Statement") in connection with the meeting of the Acquired Fund
Shareholders to consider approval of this Agreement and the transactions
contemplated herein. The Acquiring Fund will file the Registration Statement,
including the Proxy Statement, with the Commission. The Acquired Fund will
provide the Acquiring Fund with information reasonably necessary for the
preparation of a prospectus, which will include the Proxy Statement referred to
in section 4.1(o), all to be included in the Registration Statement, in
compliance in all material respects with the 1933 Act, the 1934 Act and the 1940
Act.
5.8. The Acquired Fund covenants that it will, from time to time,
as and when reasonably requested by the Acquiring Fund, execute and deliver or
cause to be executed and delivered all such assignments and other instruments,
and will take or cause to be taken such further action as the Acquiring Fund may
reasonably deem necessary or desirable in order to vest in and confirm the
Acquiring Fund's title to and possession of all the assets and otherwise to
carry out the intent and purpose of this Agreement.
5.9. The Acquiring Fund covenants to use all reasonable efforts to
obtain the approvals and authorizations required by the 1933 Act and 1940 Act,
and such of the state securities laws as it deems appropriate in order to
continue its operations after the Closing Date and to consummate the
transactions contemplated herein; provided, however, that the Acquiring Fund may
take such actions it reasonably deems advisable after the Closing Date as
circumstances change.
5.10. The Acquiring Fund covenants that it will, from time to time,
as and when reasonably requested by the Acquired Fund, execute and deliver or
cause to be executed and delivered all such assignments, assumption agreements,
releases, and other instruments, and will take or cause to be taken such further
action, as the Acquired Fund may reasonably deem necessary or desirable in order
to (i) vest and confirm to the Acquired Fund title to and possession of all
Acquiring Fund shares to be transferred to the Acquired Fund pursuant to this
Agreement and (ii) assume the liabilities from the Acquired Fund.
5.11. As soon as reasonably practicable after the Closing, the
Acquired Fund shall make a liquidating distribution to its shareholders
consisting of the Acquiring Fund Shares received at the Closing.
5.12. The Acquiring Fund and the Acquired Fund shall each use its
reasonable best efforts to fulfill or obtain the fulfillment of the conditions
precedent to effect the transactions contemplated by this Agreement as promptly
as practicable.
5.13. The intention of the parties is that the transaction will
qualify as a reorganization within the meaning of Section 368(a) of the Code.
Neither the Acquiring Corporation, the Acquired Corporation, the Acquiring Fund
nor the Acquired Fund shall take any action, or cause any action to be taken
(including, without limitation, the filing of any tax return) that is
inconsistent with such treatment or results in the failure of the transaction to
qualify as a reorganization within the meaning of Section 368(a) of the Code. At
or prior to the Closing Date, the Acquiring Corporation, the Acquired
Corporation, the Acquiring Fund and the Acquired Fund will take such action, or
cause such action to be taken, as is reasonably necessary to enable Willkie Farr
& Gallagher to render the tax opinion contemplated herein in section 8.5.
<PAGE>
5.14. At or immediately prior to the Closing, the Acquired Fund may
declare and pay to its stockholders a dividend or other distribution in an
amount large enough so that it will have distributed substantially all (and in
any event not less than 98%) of its investment company taxable income (computed
without regard to any deduction for dividends paid) and realized net capital
gain, if any, for the current taxable year through the Closing Date.
6. CONDITIONS PRECEDENT TO OBLIGATIONS OF THE ACQUIRED FUND
The obligations of the Acquired Fund to consummate the transactions
provided for herein shall be subject, at its election, to the performance by the
Acquiring Fund of all the obligations to be performed by it hereunder on or
before the Closing Date, and, in addition thereto, the following further
conditions:
6.1. All representations and warranties of the Acquiring
Corporation, on behalf of the Acquiring Fund, contained in this Agreement shall
be true and correct in all material respects as of the date hereof and, except
as they may be affected by the transactions contemplated by this Agreement, as
of the Closing Date, with the same force and effect as if made on and as of the
Closing Date; and there shall be (i) no pending or threatened litigation brought
by any person (other than the Acquired Fund, its adviser or any of their
affiliates) against the Acquiring Fund or its investment adviser(s), Board
members or officers arising out of this Agreement and (ii) no facts known to the
Acquiring Fund which the Acquiring Fund reasonably believes might result in such
litigation.
6.2. The Acquiring Fund shall have delivered to the Acquired Fund
on the Closing Date a certificate executed in its name by its President or a
Vice President, in a form reasonably satisfactory to the Acquired Corporation,
on behalf of the Acquired Fund, and dated as of the Closing Date, to the effect
that the representations and warranties of the Acquiring Fund made in this
Agreement are true and correct on and as of the Closing Date, except as they may
be affected by the transactions contemplated by this Agreement, and as to such
other matters as the Acquired Fund shall reasonably request.
6.3. The Acquired Fund shall have received on the Closing Date an
opinion of Dechert, in a form reasonably satisfactory to the Acquired Fund, and
dated as of the Closing Date, to the effect that:
(a) The Acquiring Corporation has been duly formed and is an
existing corporation; (b) the Acquiring Fund has the power to carry on its
business as presently conducted in accordance with the description thereof in
the Acquiring Fund's registration statement under the 1940 Act; (c) the
Agreement has been duly authorized, executed and delivered by the Acquiring
Corporation, on behalf of the Acquiring Fund, and constitutes a valid and
legally binding obligation of the Acquiring Corporation, on behalf of the
Acquiring Fund, enforceable in accordance with its terms, subject to bankruptcy,
insolvency, fraudulent transfer, reorganization, moratorium and laws of general
applicability relating to or affecting creditors' rights and to general equity
principles; (d) the execution and delivery of the Agreement did not, and the
exchange of the Acquired Fund's assets for Acquiring Fund Shares pursuant to the
Agreement will not, violate the Acquiring Corporation's Charter, as amended, or
By-laws; and (e) to the knowledge of such counsel, and without any independent
investigation, (i) the Acquiring Corporation is not subject to any litigation or
other proceedings that might have a materially adverse effect on the operations
of the Acquiring Corporation, (ii) the Acquiring Corporation is duly registered
as an investment company with the Commission and is not subject to any stop
order; and (iii) all regulatory consents, authorizations, approvals or filings
required to be obtained or made by the Acquiring Fund under the federal laws of
the United States or the laws of the State of Maryland for the exchange of the
<PAGE>
Acquired Fund's assets for Acquiring Fund Shares, pursuant to the Agreement have
been obtained or made.
The delivery of such opinion is conditioned upon receipt by
Dechert of customary representations it shall reasonably request of each of the
Acquiring Corporation and the Acquired Corporation.
6.4. The Acquiring Fund shall have performed all of the covenants
and complied with all of the provisions required by this Agreement to be
performed or complied with by the Acquiring Fund on or before the Closing Date.
6.5. The Acquiring Fund shall have entered into an administrative
services agreement with Scudder Kemper in a form reasonably satisfactory to the
Acquired Fund.
7. CONDITIONS PRECEDENT TO OBLIGATIONS OF THE ACQUIRING FUND
The obligations of the Acquiring Fund to consummate the transactions
provided for herein shall be subject, at its election, to the performance by the
Acquired Fund of all of the obligations to be performed by it hereunder on or
before the Closing Date and, in addition thereto, the following further
conditions:
7.1. All representations and warranties of the Acquired
Corporation, on behalf of the Acquired Fund, contained in this Agreement shall
be true and correct in all material respects as of the date hereof and, except
as they may be affected by the transactions contemplated by this Agreement, as
of the Closing Date, with the same force and effect as if made on and as of the
Closing Date; and there shall be (i) no pending or threatened litigation brought
by any person (other than the Acquiring Fund, its adviser or any of their
affiliates) against the Acquired Fund or its investment adviser(s), Board
members or officers arising out of this Agreement and (ii) no facts known to the
Acquired Fund which the Acquired Fund reasonably believes might result in such
litigation.
7.2. The Acquired Fund shall have delivered to the Acquiring Fund a
statement of the Acquired Fund's assets and liabilities as of the Closing Date,
certified by the Treasurer of the Acquired Fund.
7.3. The Acquired Fund shall have delivered to the Acquiring Fund
on the Closing Date a certificate executed in its name by its President or a
Vice President, in a form reasonably satisfactory to the Acquiring Corporation,
on behalf of the Acquiring Fund, and dated as of the Closing Date, to the effect
that the representations and warranties of the Acquired Corporation with respect
to the Acquired Fund made in this Agreement are true and correct on and as of
the Closing Date, except as they may be affected by the transactions
contemplated by this Agreement, and as to such other matters as the Acquiring
Fund shall reasonably request.
7.4. The Acquiring Fund shall have received on the Closing Date an
opinion of Dechert, in a form reasonably satisfactory to the Acquiring Fund, and
dated as of the Closing Date, to the effect that:
(a) The Acquired Corporation has been duly formed and is an
existing corporation; (b) the Acquired Fund has the power to carry on its
business as presently conducted in accordance with the description thereof in
the Acquired Corporation's registration statement under the 1940 Act; (c) the
<PAGE>
Agreement has been duly authorized, executed and delivered by the Acquired
Corporation, on behalf of the Acquired Fund, and constitutes a valid and legally
binding obligation of the Acquired Corporation, on behalf of the Acquired Fund,
enforceable in accordance with its terms, subject to bankruptcy, insolvency,
fraudulent transfer, reorganization, moratorium and laws of general
applicability relating to or affecting creditors' rights and to general equity
principles; (d) the execution and delivery of the Agreement did not, and the
exchange of the Acquired Fund's assets for Acquiring Fund Shares pursuant to the
Agreement will not, violate the Acquired Corporation's Charter, as amended, or
By-laws; and (e) to the knowledge of such counsel, and without any independent
investigation, (i) the Acquired Corporation is not subject to any litigation or
other proceedings that might have a materially adverse effect on the operations
of the Acquired Corporation, (ii) the Acquired Corporation is duly registered as
an investment company with the Commission and is not subject to any stop order,
and (iii) all regulatory consents, authorizations, approvals or filings required
to be obtained or made by the Acquired Fund under the federal laws of the United
States or the laws of the State of Maryland for the exchange of the Acquired
Fund's assets for Acquiring Fund Shares, pursuant to the Agreement have been
obtained or made.
The delivery of such opinion is conditioned upon receipt by
Dechert of customary representations it shall reasonably request of each of the
Acquiring Corporation and the Acquired Corporation.
7.5. The Acquired Fund shall have performed all of the covenants
and complied with all of the provisions required by this Agreement to be
performed or complied with by the Acquired Fund on or before the Closing Date.
8. FURTHER CONDITIONS PRECEDENT TO OBLIGATIONS OF THE ACQUIRING FUND AND
THE ACQUIRED FUND
If any of the conditions set forth below have not been met on or
before the Closing Date with respect to the Acquired Fund or the Acquiring Fund,
the other party to this Agreement shall, at its option, not be required to
consummate the transactions contemplated by this Agreement:
8.1. This Agreement and the transactions contemplated herein shall
have been approved by the requisite vote of the holders of the outstanding
shares of the Acquired Fund in accordance with the provisions of the Acquired
Corporation's Charter, as amended, and By-Laws, applicable Maryland law and the
1940 Act, and certified copies of the resolutions evidencing such approval shall
have been delivered to the Acquiring Fund. Notwithstanding anything herein to
the contrary, neither the Acquiring Fund nor the Acquired Fund may waive the
conditions set forth in this section 8.1.
8.2. On the Closing Date, no action, suit or other proceeding shall
be pending or to its knowledge threatened before any court or governmental
agency in which it is sought to restrain or prohibit, or obtain material damages
or other relief in connection with, this Agreement or the transactions
contemplated herein.
8.3. All consents of other parties and all other consents, orders
and permits of federal, state and local regulatory authorities deemed necessary
by the Acquiring Fund or the Acquired Fund to permit consummation, in all
material respects, of the transactions contemplated hereby shall have been
obtained, except where failure to obtain any such consent, order or permit would
not involve a risk of a material adverse effect on the assets or properties of
the Acquiring Fund or the Acquired Fund, provided that either party hereto may
for itself waive any of such conditions.
<PAGE>
8.4. The Registration Statement shall have become effective under
the 1933 Act and no stop orders suspending the effectiveness thereof shall have
been issued and, to the best knowledge of the parties hereto, no investigation
or proceeding for that purpose shall have been instituted or be pending,
threatened or contemplated under the 1933 Act.
8.5. The parties shall have received an opinion of Willkie Farr &
Gallagher addressed to each of the Acquiring Fund and the Acquired Fund, in a
form reasonably satisfactory to each such party to this Agreement, substantially
to the effect that, based upon certain facts, assumptions and representations of
the parties, for federal income tax purposes: (i) the transfer to the Acquiring
Fund of all or substantially all of the assets of the Acquired Fund in exchange
solely for Acquiring Fund Shares and the assumption by the Acquiring Fund of all
of the liabilities of the Acquired Fund, followed by the distribution of such
shares to the Acquired Fund Shareholders in exchange for their shares of the
Acquired Fund in complete liquidation of the Acquired Fund, will constitute a
"reorganization" within the meaning of Section 368(a)(1) of the Code, and the
Acquiring Fund and the Acquired Fund will each be "a party to a reorganization"
within the meaning of Section 368(b) of the Code; (ii) no gain or loss will be
recognized by the Acquired Fund upon the transfer of all or substantially all of
its assets to the Acquiring Fund in exchange solely for Acquiring Fund Shares
and the assumption by the Acquiring Fund of all of the liabilities of the
Acquired Fund; (iii) the basis of the assets of the Acquired Fund in the hands
of the Acquiring Fund will be the same as the basis of such assets of the
Acquired Fund immediately prior to the transfer; (iv) the holding period of the
assets of the Acquired Fund in the hands of the Acquiring Fund will include the
period during which such assets were held by the Acquired Fund; (v) no gain or
loss will be recognized by the Acquiring Fund upon the receipt of the assets of
the Acquired Fund in exchange for Acquiring Fund Shares and the assumption by
the Acquiring Fund of all of the liabilities of the Acquired Fund; (vi) no gain
or loss will be recognized by Acquired Fund Shareholders upon the receipt of the
Acquiring Fund Shares solely in exchange for their shares of the Acquired Fund
as part of the transaction; (vii) the basis of the Acquiring Fund Shares
received by Acquired Fund Shareholders will be the same as the basis of the
shares of the Acquired Fund exchanged therefor; and (viii) the holding period of
Acquiring Fund Shares received by Acquired Fund Shareholders will include the
holding period during which the shares of the Acquired Fund exchanged therefor
were held, provided that at the time of the exchange the shares of the Acquired
Fund were held as capital assets in the hands of Acquired Fund Shareholders. The
delivery of such opinion is conditioned upon receipt by Willkie Farr & Gallagher
of representations it shall request of each of the Acquiring Corporation and
Acquired Corporation. Notwithstanding anything herein to the contrary, neither
the Acquiring Fund nor the Acquired Fund may waive the condition set forth in
this section 8.5.
9. INDEMNIFICATION
9.1. The Acquiring Fund agrees to indemnify and hold harmless the
Acquired Fund and each of the Acquired Fund's Board members and officers from
and against any and all losses, claims, damages, liabilities or expenses
(including, without limitation, the payment of reasonable legal fees and
reasonable costs of investigation) to which jointly and severally, the Acquired
Fund or any of its Board members or officers may become subject, insofar as any
such loss, claim, damage, liability or expense (or actions with respect thereto)
arises out of or is based on any breach by the Acquiring Fund of any of its
representations, warranties, covenants or agreements set forth in this
Agreement.
9.2. The Acquired Fund agrees to indemnify and hold harmless the
Acquiring Fund and each of the Acquiring Fund's Board members and officers from
and against any and all losses, claims, damages, liabilities or expenses
(including, without limitation, the payment of reasonable legal fees and
<PAGE>
reasonable costs of investigation) to which jointly and severally, the Acquiring
Fund or any of its Board members or officers may become subject, insofar as any
such loss, claim, damage, liability or expense (or actions with respect thereto)
arises out of or is based on any breach by the Acquired Fund of any of its
representations, warranties, covenants or agreements set forth in this
Agreement.
10. FEES AND EXPENSES
10.1. Each of the Acquiring Corporation, on behalf of the Acquiring
Fund, and the Acquired Corporation, on behalf of the Acquired Fund, represents
and warrants to the other that it has no obligations to pay any brokers or
finders fees in connection with the transactions provided for herein.
10.2. The anticipated costs of the Reorganization allocable to the
Acquired Fund are $33,001, which includes board meeting fees, legal, accounting
and other consultant fees, and proxy solicitation costs. Class A shares of the
Acquired Fund will pay $11,984 and Class B shares of the Acquired Fund will pay
$16,116, each of which represents 100% of the estimated costs allocable to Class
A and Class B shares, respectively. Class C shares of the Acquired Fund will pay
a portion of their allocable costs of the Reorganization, or $4,573 out of
$4,901 (93.31%). Scudder Kemper will bear the remaining costs, including any
cost overruns (except that the Acquiring Fund will bear the SEC and state
registration and notice fees which are estimated to be $_________). Any such
expenses which are so borne by Scudder Kemper will be solely and directly
related to the Reorganization within the meaning of Revenue Ruling 73-54, 1973-1
C.B. 187. Acquired Fund Shareholders will pay their own expenses, if any,
incurred in connection with the Reorganization.
11. ENTIRE AGREEMENT; SURVIVAL OF WARRANTIES
11.1. The Acquiring Fund and the Acquired Fund agree that neither
party has made any representation, warranty or covenant not set forth herein and
that this Agreement constitutes the entire agreement between the parties.
11.2. Except as specified in the next sentence set forth in this
section 11.2, the representations, warranties and covenants contained in this
Agreement or in any document delivered pursuant hereto or in connection herewith
shall not survive the consummation of the transactions contemplated hereunder.
The covenants to be performed after the Closing and the obligations of each of
the Acquiring Fund and Acquired Fund in sections 9.1 and 9.2 shall survive the
Closing.
12. TERMINATION
12.1. This Agreement may be terminated and the transactions
contemplated hereby may be abandoned by either party by (i) mutual agreement of
the parties, or (ii) by either party if the Closing shall not have occurred on
or before [ ], 2001, unless such date is extended by mutual agreement of the
parties, or (iii) by either party if the other party shall have materially
breached its obligations under this Agreement or made a material and intentional
misrepresentation herein or in connection herewith. In the event of any such
termination, this Agreement shall become void and there shall be no liability
hereunder on the part of any party or their respective Board members or
officers, except for any such material breach or intentional misrepresentation,
as to each of which all remedies at law or in equity of the party adversely
affected shall survive.
<PAGE>
13. AMENDMENTS
This Agreement may be amended, modified or supplemented in such manner
as may be mutually agreed upon in writing by any authorized officer of the
Acquired Fund and any authorized officer of the Acquiring Fund; provided,
however, that following the meeting of the Acquired Fund Shareholders called by
the Acquired Fund pursuant to section 5.3 of this Agreement, no such amendment
may have the effect of changing the provisions for determining the number of the
Acquiring Fund Shares to be issued to the Acquired Fund Shareholders under this
Agreement to the detriment of such shareholders without their further approval.
14. NOTICES
Any notice, report, statement or demand required or permitted by any
provisions of this Agreement shall be in writing and shall be deemed duly given
if delivered by hand (including by Federal Express or similar express courier)
or transmitted by facsimile or three days after being mailed by prepaid
registered or certified mail, return receipt requested, addressed to the
Acquired Fund, 222 South Riverside Plaza, Chicago, Illinois 60606, with a copy
to Dechert, Ten Post Office Square South, Boston, MA 02109-4603, Attention:
Joseph R. Fleming, Esq., or to the Acquiring Fund, 345 Park Avenue, New York,
New York 10154, with a copy to Dechert, Ten Post Office Square South, Boston, MA
02109-4603, Attention: Joseph R. Fleming, Esq., or to any other address that the
Acquired Fund or the Acquiring Fund shall have last designated by notice to the
other party.
15. HEADINGS; COUNTERPARTS; ASSIGNMENT; LIMITATION OF LIABILITY
15.1. The Article and section headings contained in this Agreement
are for reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement.
15.2. This Agreement may be executed in any number of counterparts,
each of which shall be deemed an original.
15.3. This Agreement shall bind and inure to the benefit of the
parties hereto and their respective successors and assigns, but no assignment or
transfer hereof or of any rights or obligations hereunder shall be made by any
party without the written consent of the other party. Nothing herein expressed
or implied is intended or shall be construed to confer upon or give any person,
firm or corporation, other than the parties hereto and the shareholders of the
Acquiring Fund and the Acquired Fund and their respective successors and
assigns, any rights or remedies under or by reason of this Agreement.
15.4. Notwithstanding anything to the contrary contained in this
Agreement, the obligations, agreements, representations and warranties with
respect to each Fund shall constitute the obligations, agreements,
representations and warranties of that Fund only (the "Obligated Fund"), and in
no event shall any other series of the Acquiring Corporation or the Acquired
Corporation or the assets of any such series be held liable with respect to the
breach or other default by the Obligated Fund of its obligations, agreements,
representations and warranties as set forth herein.
15.5. This Agreement shall be governed by, and construed and
enforced in accordance with, the laws of The Commonwealth of Massachusetts,
without regard to its principles of conflicts of laws.
<PAGE>
IN WITNESS WHEREOF, each of the parties hereto has caused this
Agreement to be executed by an authorized officer and its seal to be affixed
thereto and attested by its Secretary or Assistant Secretary.
Attest: GLOBAL/INTERNATIONAL FUND, INC.
on behalf of Scudder Global Fund
_________________________
Secretary
________________________________
By:_____________________________
Its:____________________________
Attest: KEMPER GLOBAL/INTERNATIONAL SERIES, INC.
on behalf of Kemper Global Blue Chip Fund
_________________________
Secretary
________________________________
By:_____________________________
Its:____________________________
AGREED TO AND ACKNOWLEDGED
ONLY WITH RESPECT TO
PARAGRAPH 10.2 HERETO
SCUDDER KEMPER INVESTMENTS, INC.
________________________________
By:_____________________________
Its:____________________________
<PAGE>
EXHIBIT B
Management's Discussion of Scudder Global Fund's Performance
<PAGE>
Performance Update
--------------------------------------------------------------------------------
August 31, 2000
--------------------------------------------------------------------------------
Growth of a $10,000 Investment
--------------------------------------------------------------------------------
THE ORIGINAL DOCUMENT CONTAINS A LINE CHART HERE
LINE CHART DATA:
Scudder Global Fund MSCI World Index*
------------------- -----------------
'90 10000 10000
'91 10687 10855
'92 11572 11128
'93 14076 13508
'94 15745 14645
'95 16927 15849
'96 18834 17843
'97 23229 21823
'98 23380 22639
'99 29105 30123
'00 33129 34074
Yearly periods ended August 31
--------------------------------------------------------------------------------
Fund Index Comparison
--------------------------------------------------------------------------------
Total Return
Growth of Average
Period ended 8/31/2000 $10,000 Cumulative Annual
--------------------------------------------------------------------------------
Scudder Global Fund
--------------------------------------------------------------------------------
1 year $ 11,383 13.83% 13.83%
--------------------------------------------------------------------------------
5 year $ 19,572 95.72% 14.37%
--------------------------------------------------------------------------------
10 year $ 33,129 231.29% 12.73%
--------------------------------------------------------------------------------
MSCI World Index*
--------------------------------------------------------------------------------
1 year $ 11,312 13.12% 13.12%
--------------------------------------------------------------------------------
5 year $ 21,499 114.99% 16.52%
--------------------------------------------------------------------------------
10 year $ 34,074 240.74% 13.03%
--------------------------------------------------------------------------------
6
<PAGE>
* The Morgan Stanley Capital International (MSCI) World Index is an unmanaged
capitalization- weighted measure of global stock markets including the U.S.,
Canada, Europe, Australia and the Far East. Index returns assume dividends
reinvested net of withholding tax and, unlike Fund returns, do not reflect
any fees or expenses.
All performance is historical, assumes reinvestment of all dividends and
capital gains, and is not indicative of future results. Investment return and
principal value will fluctuate, so an investor's shares, when redeemed, may
be worth more or less than when purchased.
7
<PAGE>
Portfolio Management Discussion
--------------------------------------------------------------------------------
August 31, 2000
In the following interview, lead portfolio manager William E. Holzer discusses
Scudder Global Fund's strategy and the market environment in the twelve-month
period ended August 31, 2000.
Q: How would you characterize the global market environment of the past year?
A: The last twelve months have been notable in the sense that the markets have
been extremely volatile, and investors' perception of the so-called "old" and
"new" economies has changed considerably. The latter part of 1999 and the first
two months of this year were characterized by a very strong run-up in large-cap
technology stocks worldwide, as central banks injected substantial liquidity
into the global economy in order to preempt any Y2K problems. This rally was
especially marked in Europe and Asia, as the narrow universe of non-U.S.
technology stocks caught up -- and in some cases overtook -- their U.S.
counterparts in terms of valuation. The dominance of this small universe of
large-cap stocks ensured that index performance was strong through the early
months of 2000.
Once Y2K proved to be a non-issue, central banks (especially in the U.S.) began
to rein in liquidity. A climate of higher rates globally prompted investors to
question the valuation of so-called "new economy" stocks, and to be highly
sensitive to any shortfalls in their earnings results. The period from
March-June 2000 saw a dramatic sell-off in the technology, media, and
telecommunications (TMT) sectors, and the apparent resurgence of large-cap "old
economy" stocks with attractive valuations. By mid-summer, growing investor
confidence regarding the prospects of a soft landing in the U.S. economy -- and
an end to the long series of U.S. rate hikes -- halted these declines. (The term
"soft landing" refers to a slowing of growth -- brought about by Fed rate hikes
-- that allows the economy to continue growing at a more reasonable pace, but
without the threat of inflation that could arise during a period of rapid
growth.) But confidence nevertheless remained bruised, as evidenced by the
reaction
10
<PAGE>
to slowing momentum amongst industry titans like Nokia, and a reflection on the
potential for lower long-term returns among telecom companies, suggested by the
very high prices obtained by the European nations for wireless bandwidth. In
addition, investors were rattled by soaring energy prices and the persistent
weakness in the euro, continental Europe's common currency.
Q: How was the fund positioned for this environment?
A: Our strategic view since late 1998 has emphasized the compelling nature of
consumers' adoption of technology, the emergence of the "virtual corporation"
(as companies' boundaries become more transparent due to technology and
technology-driven relationships with suppliers and customers), and rapid
consolidation among producers of raw materials and commodity manufactured goods
as they seek to generate the returns on capital demanded by investors. This view
also directs us away from companies caught between price-advantaged virtual
companies and the higher input prices charged by consolidating suppliers. We
have therefore sought to pursue a "barbell" strategy, which is designed to
provide appropriate exposure to technology opportunities, balanced by different,
non-correlated risks.
This approach has led us to maintain an emphasis on the four key themes that we
outlined in the February report. "The Empowered Consumer" focuses on companies
that are enabling consumers to take advantage of the Internet. Included in this
category are makers of consumer devices, providers of Internet access, and
content providers. Since late 1999, we have been trimming exposure to our
investments in this area, as well as upgrading their overall quality.
"Virtuality," which also focuses on technology, is a theme that includes
companies whose business strategies are moving to Internet-based models, as well
as existing companies that are taking advantage of the Internet to expand their
regular lines of business. Overall, our holdings under these two themes produced
a strong performance over the full period, but we will be keeping a
11
<PAGE>
watchful eye on the fund's technology exposure, since the market has been
judging any hiccups in company performance swiftly and harshly.
On the old economy side are the "Ultimate Subcontractor," through which we
invest in commodity producing companies that are poised to benefit from
increasing price advantages and faster global growth, and "Secure Streams of
Income," which provides defensive exposure through its positions in power and
infrastructure utilities. In combination, these two themes represent the bulk of
our exposure to companies outside of the technology area.
Q: How did the fund perform in this climate?
A: Although the fund's performance lagged against its benchmark when tech stocks
were rallying during the early part of 2000, its extensive diversification
proved beneficial to performance over the full year. During the twelve-month
period ended August 31, 2000, the fund produced a total return of 13.83%, versus
a gain of 13.12% for its unmanaged benchmark, the MSCI World Index. In a period
notable for its high volatility and rapid sector rotations, our focus on
maintaining exposure to stocks in a wide range of industries proved beneficial
to the fund's risk-adjusted returns. Specifically, it allowed us to take
advantage of the run-up in technology stocks in the November-February period,
and to prosper from the stronger performance of old economy stocks -- such as
those in the energy and utilities sectors -- during the summer months.
Q: What are some stocks that illustrate the fund's investment themes?
A: The Ultimate Subcontractor theme is illustrated by Anadarko Petroleum, one of
the world's largest independent exploration and production companies. Our
investment rationale for this stock is similar to the thesis behind other stocks
we hold under this theme; namely, our belief that it is one of the better
companies in a raw
12
<PAGE>
materials industry that is emerging from years of low prices and consolidation
as a leaner, cheaper producer at a time when pricing power is returning. The
stock, which has benefited from higher oil prices, new discoveries, and the
acquisition of new properties, has been a consistent performer for the fund.
Nextel, a telecom company that we hold under the Empowered Consumer theme,
provides both digital and analog communications services, and is building the
infrastructure that supports the Internet. Just this past year, Nextel
introduced the new mobile phones that will allow users access to the Internet.
Although this technology is still in its infancy, we believe it will lead to a
myriad of handheld devices that will allow users to access the Internet without
a hard wire connection. As the operator of a national cellular network in the
U.S., Nextel should be positioned to capitalize on the growth in popularity of
these devices.
Under the Virtuality theme, we hold Enron, an electric and gas concern that has
successfully broken into e-business. The company's Web site allows buyers and
sellers to conduct transactions on over 800 products in a matter of seconds.
Enron has pioneered the idea of making a market in electricity and gas, and
helped create the infrastructure to allow the trading of these commodities.
Recently, it has also turned its attention to bandwidth trading. In this way,
the company has embraced the use of the Internet to grow earnings by expanding
on its traditional lines of business.
Q: What is your outlook for the remainder of 2000 and beyond?
A: Our view of the global economy remains mixed as we approach year-end. We
believe that it may be too early to assume that the U.S. has experienced a "soft
landing." Worldwide production overcapacity, stretched further by the
efficiencies achieved by the adoption of technology in the form of productivity
gains and networked supplier relationships, is keeping some prices well in
check. Nevertheless, we must seek to understand what will take
13
<PAGE>
place when excess capacity is exhausted. In the meantime, there must be a
resolution to the conflicting trends of a slowing economy and continued
increases in corporate earnings. Buffeted by these inconsistencies in the short
term, markets should remain volatile. Over the longer term, however, the
investment picture remains far from clear.
We will therefore maintain our current investment strategy, using our thematic
approach and extensive diversification to strive to produce attractive returns
and mitigate risks. This approach has worked well during the volatile
environment of the past year, and we believe it will also be well suited for the
months ahead.
14
<PAGE>
APPENDIX 1
Director and Nominee Shareholdings
<PAGE>
APPENDIX 2
Beneficial Owners of Fund Shares
<PAGE>
This Proxy Statement/Prospectus is accompanied by Scudder Global Fund's
prospectus offering Class A, Class B and Class C shares dated December 29, 2000,
which was previously filed with the Securities and Exchange Commission (the
"Commission") via EDGAR on October 30, 2000 (File No. 811-4670) and is
incorporated by reference herein.
Kemper Global Blue Chip Fund's prospectus dated March 1, 2000, which was
previously filed with the Commission via EDGAR on March 6, 2000 (File No. 811-
08395), is incorporated by reference herein.
Scudder Global Fund's statement of additional information offering Class A,
Class B and Class C shares dated December 29, 2000, which was previously filed
with the Commission via EDGAR on October 30, 2000 (File No. 811-4670), is
incorporated by reference herein.
<PAGE>
PART B
GLOBAL/INTERNATIONAL FUND, INC.
---------------------------------------------------------
Statement of Additional Information
March [ ], 2001
---------------------------------------------------------
Acquisition of the Assets of By and in Exchange for Shares of
Kemper Global Blue Chip Fund, a series of Scudder Global Fund, a series of
Kemper Global/International Series, Inc. Global/International Fund, Inc.
222 South Riverside Plaza (the "Acquiring Corporation")
Chicago, IL 60606 345 Park Avenue
New York, NY 10154
This Statement of Additional Information is available to the shareholders
of Kemper Global Blue Chip Fund in connection with a proposed transaction
whereby Scudder Global Fund will acquire all or substantially all of the assets
and all of the liabilities of Kemper Global Blue Chip Fund in exchange for
shares of the Scudder Global Fund (the "Reorganization").
This Statement of Additional Information of the Acquiring Corporation
contains material which may be of interest to investors but which is not
included in the Proxy Statement/Prospectus of the Acquiring Corporation relating
to the Reorganization. This Statement of Additional Information consists of
this cover page and the following documents:
1. Scudder Global Fund's statement of additional information offering Class A,
Class B and Class C shares dated December 29, 2000, which was previously filed
with the Securities and Exchange Commission (the "Commission") via EDGAR on
October 30, 2000 (File No. 811-4670) and is incorporated by reference herein.
2. Scudder Global Fund's annual report to shareholders for the fiscal year
ended August 31, 2000, which was previously filed with the Commission via EDGAR
on October 25, 2000 (File No. 811-4670) and is incorporated by reference herein.
3. Kemper Global Blue Chip Fund's prospectus dated March 1, 2000, which was
previously filed with the Commission via EDGAR on March 6, 2000 (File No. 811-
08395) and is incorporated by reference herein.
4. Kemper Global Blue Chip Fund's statement of additional information dated
March 1, 2000, which was previously filed with the Commission via EDGAR on March
6, 2000 (File No. 811-08395) and is incorporated by reference herein.
5. Kemper Global Blue Chip Fund's annual report to shareholders for the fiscal
year ended October 31, 1999, which was previously filed with the Commission via
EDGAR on January 6, 2000 (File No. 811-08395) and is incorporated by reference
herein.
<PAGE>
6. Kemper Global Blue Chip Fund's semiannual report to shareholders for the
period ended April 30, 2000, which was previously filed with the Commission via
EDGAR on June 30, 2000 (File No. 811-08395) and is incorporated by reference
herein.
This Statement of Additional Information is not a prospectus. A Proxy
Statement/Prospectus dated March [ ], 2001 relating to the Reorganization may
be obtained by writing Kemper Global Blue Chip Fund at 222 South Riverside
Drive, Chicago, IL 60606 or by calling [ ] at 1-800-[ ].
This Statement of Additional Information should be read in conjunction with the
Proxy Statement/Prospectus.
<PAGE>
PART C. OTHER INFORMATION
Item 15. Indemnification
-------- ---------------
A policy of insurance covering Scudder Kemper Investments, Inc., its
subsidiaries including Scudder Investor Services, Inc., and all of the
registered investment companies advised by Scudder Kemper Investments,
Inc. insures the Registrant's Directors and officers and others
against liability arising by reason of an alleged breach of duty
caused by any negligent error or accidental omission in the scope of
their duties.
Article Tenth of Registrant's Articles of Amendment and Restatement
states as follows:
TENTH Liability and Indemnification
----- -----------------------------
To the fullest extent permitted by the Maryland General
Corporation Law and the Investment Company Act of 1940, no director or
officer of the Corporation shall be liable to the Corporation or to
its stockholders for damages. This limitation on liability applies to
events occurring at the time a person serves as a director or officer
of the Corporation, whether or not such person is a director or
officer at the time of any proceeding in which liability is asserted.
No amendment to these Articles of Amendment and Restatement or repeal
of any of its provisions shall limit or eliminate the benefits
provided to directors and officers under this provision with respect
to any act or omission which occurred prior to such amendment or
repeal.
The Corporation, including its successors and assigns, shall
indemnify its directors and officers and make advance payment of
related expenses to the fullest extent permitted, and in accordance
with the procedures required by Maryland law, including Section 2-418
of the Maryland General Corporation Law, as may be amended from time
to time, and the Investment Company Act of 1940. The By-laws may
provide that the Corporation shall indemnify its employees and/or
agents in any manner and within such limits as permitted by applicable
law. Such indemnification shall be in addition to any other right or
claim to which any director, officer, employee or agent may otherwise
be entitled.
The Corporation may purchase and maintain insurance on behalf of
any person who is or was a director, officer, employee or agent of the
Corporation or is or was serving at the request of the Corporation as
a director, officer, partner, trustee, employee or agent of another
foreign or domestic corporation, partnership, joint venture, trust or
other enterprise or employee benefit plan against any liability
asserted against and incurred by such person in any such capacity or
arising out of such person's position, whether or not the Corporation
would have had the power to indemnify against such liability.
The rights provided to any person by this Article shall be
enforceable against the Corporation by such person who shall be
presumed to have relied upon such rights in serving or continuing to
serve in the capacities indicated herein. No amendment of these
Articles of Amendment and Restatement shall impair the rights of any
person arising at any time with respect to events occurring prior to
such amendment.
Nothing in these Articles of Amendment and Restatement shall be
deemed to (i) require a waiver of compliance with any provision of the
Securities Act of 1933, as
<PAGE>
amended, or the Investment Company Act of 1940, as amended, or of any
valid rule, regulation or order of the Securities and Exchange
Commission under those Acts or (ii) protect any director or officer of
the Corporation against any liability to the Corporation or its
stockholders to which he would otherwise be subject by reason of
willful misfeasance, bad faith or gross negligence in the performance
of his or her duties or by reason of his or her reckless disregard of
his or her obligations and duties hereunder.
Item 16. Exhibits.
-------- ---------
(1) (a)(1) Articles of Amendment and Restatement, dated December
13, 1990, are incorporated by reference to Post-
Effective Amendment No. 8 to the Registration
Statement of Global/International Fund, Inc. on Form
N-1A, as amended (the "Registration Statement").
(a)(2) Articles of Amendment, dated December 29, 1997, are
incorporated by reference to Post-Effective Amendment
No. 34 to the Registration Statement.
(a)(3) Articles of Amendment, dated May 29, 1998, are
incorporated by reference to Post-Effective Amendment
No. 34 to the Registration Statement.
(a)(4) Articles Supplementary, dated February 14, 1991, are
incorporated by reference to Post-Effective Amendment
No. 9 to the Registration Statement.
(a)(5) Articles Supplementary, dated July 11, 1991, are
incorporated by reference to Post-Effective Amendment
No. 12 to the Registration Statement.
(a)(6) Articles Supplementary, dated November 24, 1992, are
incorporated by reference to Post-Effective Amendment
No. 18 to the Registration Statement.
(a)(7) Articles Supplementary, dated October 20, 1993, are
incorporated by reference to Post-Effective Amendment
No. 19 to the Registration Statement.
(a)(8) Articles Supplementary, dated December 14, 1995, are
incorporated by reference to Post-Effective Amendment
No. 26 to the Registration Statement.
(a)(9) Articles Supplementary, dated March 6, 1996, are
incorporated by reference to Post-Effective Amendment
No. 28 to the Registration Statement.
<PAGE>
(a)(10) Articles Supplementary, dated April 15, 1998 are
incorporated by reference to Post-Effective Amendment
No. 34 to the Registration Statement.
(a)(11) Articles Supplementary, dated March 31, 2000, are
incorporated by reference to Post-Effective Amendment
No. 44 to the Registration Statement.
(2) (b)(1) By-Laws, dated May 15, 1986, are incorporated by
reference to the original Registration Statement.
(b)(2) Amendment to the By-Laws, dated May 4, 1987, is
incorporated by reference to Post-Effective Amendment
No. 2 to the Registration Statement.
(b)(3) Amendment to the By-Laws, dated September 14, 1987,
is incorporated by reference to Post-Effective
Amendment No. 5 to the Registration Statement.
(b)(4) Amendment to the By-Laws, dated July 27, 1988, is
incorporated by reference to Post-Effective Amendment
No. 5 to the Registration Statement.
(b)(5) Amendment to the By-Laws, dated September 15, 1989,
is incorporated by reference to Post-Effective
Amendment No. 7 to the Registration Statement.
(b)(6) Amended and Restated By-Laws, dated March 4, 1991,
are incorporated by reference to Post-Effective
Amendment No. 12 to the Registration Statement.
(b)(7) Amendment to the By-Laws, dated September 20, 1991,
is incorporated by reference to Post-Effective
Amendment No. 15 to the Registration Statement.
(b)(8) Amendment to the By-Laws, dated December 12, 1991, is
incorporated by reference to Post-Effective Amendment
No. 23 to the Registration Statement.
(b)(9) Amendment to the By-Laws, dated October 1, 1996, is
incorporated by reference to Post-Effective Amendment
No. 27 to the Registration Statement.
(b)(10) Amendment to the By-Laws, dated December 3, 1997, is
incorporated by reference to Post-Effective Amendment
No. 34 to the Registration Statement.
(b)(11) Amendment to the By-Laws, dated February 7, 2000, is
incorporated by reference to Post-Effective Amendment
No. 43 to the Registration Statement.
<PAGE>
(3) Inapplicable.
(4) Form of Agreement and Plan of Reorganization is filed
herein as Exhibit A to Part A.
(5) (c)(1) Specimen Share Certificate representing shares of
capital stock of $.01 par value of Scudder Global
Fund is incorporated by reference to Post-Effective
Amendment No. 6 to the Registration Statement.
(c)(2) Specimen Share Certificate representing shares of
capital stock of $.01 par value of Scudder
International Bond Fund is incorporated by reference
to Post-Effective Amendment No. 6 to the Registration
Statement.
(6) (d)(1) Investment Management Agreement between the
Registrant (on behalf of Scudder Global Fund) and
Scudder Kemper Investments, Inc. dated September 7,
1998 is incorporated by reference to Post-Effective
Amendment No. 36 to the Registration Statement.
(d)(2) Investment Management Agreement between the
Registrant (on behalf of Scudder International Bond
Fund) and Scudder Kemper Investments, Inc., dated
September 7, 1998, is incorporated by reference to
Post-Effective Amendment No. 36 to the Registration
Statement.
(d)(3) Investment Management Agreement between the
Registrant (on behalf of Scudder Global Bond Fund)
and Scudder Kemper Investments, Inc., dated September
7, 1998, is incorporated by reference to Post-
Effective Amendment No. 36 to the Registration
Statement.
(d)(4) Investment Management Agreement between the
Registrant (on behalf of Scudder Global Discovery
Fund) and Scudder Kemper Investments, Inc., dated
September 7, 1998, is incorporated by reference to
Post Effective Amendment No. 36 to the Registration
Statement.
(d)(5) Investment Management Agreement between the
Registrant (on behalf of Scudder Emerging Markets
Income Fund) and Scudder Kemper Investments, Inc.,
dated September 7, 1998 is incorporated by reference
to Post-Effective Amendment No. 36 to the
Registration Statement.
(7) (e)(1) Underwriting Agreement between the Registrant and
Scudder Investor Services, Inc., dated September 7,
1998, is incorporated by reference to Post-Effective
Amendment No. 36 to the Registration Statement.
<PAGE>
(e)(2) Underwriting and Distribution Services Agreement
between the Registrant (on behalf of Global Discovery
Fund) and Kemper Distributors, Inc., dated August 6,
1998, is incorporated by reference to Post Effective
Amendment 36 to the Registration Statement.
(e)(3) Underwriting and Distribution Services Agreement
between the Registrant (on behalf of Global Discovery
Fund) and Kemper Distributors, Inc., dated September
7, 1998, is incorporated by reference to Post
Effective Amendment No. 37 to the Registration
Statement.
(e)(4) Underwriting Agreement between the Registrant and
Scudder Investor Services, Inc. dated May 8, 2000, is
incorporated by reference to Post Effective Amendment
No. 45 to the Registrant Statement.
(8) Inapplicable.
(9) (g)(1) Custodian Agreement between the Registrant and State
Street Bank and Trust Company, dated July 24, 1986,
is incorporated by reference to Post-Effective
Amendment No. 1 to the Registration Statement.
(g)(2) Fee schedule for Exhibit (g)(1) is incorporated by
reference to Post-Effective Amendment No. 4 to the
Registration Statement.
(g)(3) Custodian Agreement between the Registrant (on behalf
of Scudder International Bond Fund) and Brown
Brothers Harriman & Co., dated July 1, 1988, is
incorporated by reference to Post-Effective Amendment
No. 5 to the Registration Statement.
(g)(4) Fee schedule for Exhibit 8(g)(3) is incorporated by
reference to Post-Effective Amendment No. 5 to the
Registration Statement.
(g)(5) Amendment, dated September 16, 1988, to the Custodian
Contract between the Registrant and State Street Bank
and Trust Company, dated July 24, 1986, is
incorporated by reference to Post-Effective Amendment
No. 6 to the Registration Statement.
(g)(6) Amendment, dated December 7, 1988, to the Custodian
Contract between the Registrant and State Street Bank
and Trust Company dated July 24, 1986 is incorporated
by reference to Post-Effective Amendment No. 6 to the
Registration Statement.
(g)(7) Amendment, dated November 30, 1990, to the Custodian
Contract between the Registrant and State Street Bank
and Trust Company, dated July 24, 1986, is
incorporated by reference to Post-Effective Amendment
No. 10 to the Registration Statement.
<PAGE>
(g)(8) Custodian Agreement between the Registrant (on behalf
of Scudder Short Term Global Income Fund) and Brown
Brothers Harriman & Co., dated February 28, 1991, is
incorporated by reference to Post-Effective Amendment
No. 15 to the Registration Statement.
(g)(9) Custodian Agreement between the Registrant (on behalf
of Scudder Global Small Company Fund) and Brown
Brothers Harriman & Co., dated August 30, 1991, is
incorporated by reference to Post-Effective Amendment
No. 16 to the Registration Statement.
(g)(10) Custodian Agreement between the Registrant (on behalf
of Scudder Emerging Markets Income Fund) and Brown
Brothers Harriman & Co., dated December 31, 1993, is
incorporated by reference to Post-Effective Amendment
No. 23 to the Registration Statement.
(g)(11) Amendment (on behalf of Scudder Global Fund) dated
October 3, 1995 to the Custodian Agreement between
the Registrant and Brown Brothers Harriman & Co.,
dated March 7, 1995, is incorporated by reference to
Post-Effective Amendment No. 24 to the Registration
Statement.
(g)(12) Amendment, dated September 29, 1997, to the Custodian
Contract between the Registrant and Brown Brothers
Harriman & Co., dated March 7, 1995, is incorporated
by reference to Post-Effective Amendment No. 32 to
the Registration Statement.
(g)(13) Amendment (on behalf of Scudder International Bond
Fund), dated April 16, 1998, to the Custodian
Agreement between the Registrant and Brown Brothers
Harriman & Co., dated March 7, 1995, is incorporated
by reference to Post-Effective Amendment No. 34 to
the Registration Statement.
(g)(14) Amendment (on behalf of Scudder Global Discovery
Fund), dated April 16, 1998, to the Custodian
Agreement between the Registrant and Brown Brothers
Harriman & Co., dated March 7, 1998, is incorporated
by reference to Post-Effective Amendment No. 34 to
the Registration Statement.
(g)(15) Amendment (on behalf of Scudder Emerging Markets
Income Fund), dated June 17, 1998, to the Custodian
Agreement between the Registrant and Brown Brothers
Harriman & Co., dated March 7, 1995, is incorporated
by reference to Post-Effective Amendment No. 34 to
the Registration Statement.
(10) (m)(1) Amended and Restated Rule 12b-1 Plan for Global
Discovery Fund Class B Shares, dated August 6, 1998,
is incorporated by reference to Post Effective
Amendment No. 36 to the Registration Statement.
<PAGE>
(m)(2) Amended and Restated Rule 12b-1 Plan for Global
Discovery Fund Class C Shares, dated August 6, 1998,
is incorporated by reference to Post Effective
Amendment No. 36 to the Registration Statement.
(m)(3) Mutual Funds Multi-Distribution System Plan pursuant
to Rule 18f-3 is incorporated by reference to Post-
Effective Amendment No. 33 to the Registration
Statement.
(m)(4) Plan with respect to Scudder Emerging Markets Income
Fund pursuant to Rule 18f-3 is incorporated by
reference to Post Effective Amendment No. 45 to the
Registration Statement.
(m)(5) Plan with respect to Scudder Global Fund pursuant to
Rule 18f-3 is incorporated by reference to Post
Effective Amendment No. 45 to the Registration
Statement.
(m)(6) Plan with respect to Scudder Global Bond Fund
pursuant to Rule 18f-3 is incorporated by reference
to Post Effective Amendment No. 45 to the
Registration Statement.
(m)(7) Amended and Restated Plan with respect to Scudder
Emerging Markets Income Fund pursuant to Rule 18f-3
is incorporated by reference to Post Effective
Amendment No. 45 to the Registration Statement.
(m)(8) Amended and Restated Plan with respect to Scudder
Global Fund pursuant to Rule 18f-3 is incorporated by
reference to Post Effective Amendment No. 45 to the
Registration Statement.
(m)(9) Amended and Restated Plan with respect to Scudder
Global Bond Fund pursuant to Rule 18f-3 is
incorporated by reference to Post Effective Amendment
No. 45 to the Registration Statement.
(m)(10) Amended and Restated Plan with respect to Scudder
International Bond Fund pursuant to Rule 18f-3 is
incorporated by reference to Post Effective Amendment
No. 45 to the Registration Statement.
(m)(11) Scudder Funds Amended and Restated Multi-Distribution
System Plan is filed herewith.
(11) Opinion and Consent of Dechert is filed herewith.
(12) Opinion and Consent of Willkie, Farr and Gallagher to
be filed by post-effective amendment.
(13) (h)(1) Transfer Agency and Service Agreement between the
Registrant and Scudder Service Corporation, dated
October 2, 1989, is incorporated by reference to
Post-Effective Amendment No. 7 to the Registration
Statement.
<PAGE>
(h)(2) Revised fee schedule, dated October 1, 1996, for
Exhibit 9(a)(1) is incorporated by reference to Post-
Effective Amendment No. 28 to the Registration
Statement.
(h)(3) Agency agreement between the Registrant, (on behalf
of Global Discovery Fund) and Kemper Service Company,
dated April 16,1998, is incorporated by reference to
Post-Effective Amendment No. 35 to the Registration
Statement.
(h)(4) COMPASS Service Agreement between Scudder Trust
Company and the Registrant, dated October 1, 1995, is
incorporated by reference to Post-Effective Amendment
No. 26 to the Registration Statement.
(h)(5) Revised fee schedule, dated October 1, 1996, for
Exhibit 9(b)(4) is incorporated by reference to Post-
Effective Amendment No. 28 to the Registration
Statement.
(h)(6) Shareholder Services Agreement with Charles Schwab &
Co., Inc., dated June 1, 1990, is incorporated by
reference to Post-Effective Amendment No. 7 to the
Registration Statement.
(h)(7) Service Agreement between Copeland Associates, Inc.
and Scudder Service Corporation (on behalf of Scudder
Global Fund and Scudder Global Small Company Fund),
dated June 8, 1995, is incorporated by reference to
Post-Effective Amendment No. 24 to the Registration
Statement.
(h)(8) Administrative Services Agreement between McGladrey &
Pullen, Inc. and the Registrant, dated September 30,
1995, is incorporated by reference to Post-Effective
Amendment No. 26 to the Registration Statement.
(h)(9) Administrative Services Agreement between the
Registrant (on behalf of Global Discovery Fund) and
Kemper Distributors, Inc., dated April 16, 1998, is
incorporated by reference to Post-Effective Amendment
No. 34 to the Registration Statement.
(h)(10) Fund Accounting Services Agreement between the
Registrant (on behalf of Scudder Global Fund) and
Scudder Fund Accounting Corporation, dated March 14,
1995, is incorporated by reference to Post-Effective
Amendment No. 24 to the Registration Statement.
(h)(11) Fund Accounting Services Agreement between the
Registrant (on behalf of Scudder International Bond
Fund) and Scudder Fund Accounting Corporation, dated
August 3, 1995, is incorporated by reference to Post-
Effective Amendment No. 25 to the Registration
Statement.
<PAGE>
(h)(12) Fund Accounting Services Agreement between the
Registrant (on behalf of Scudder Global Small Company
Fund) and Scudder Fund Accounting Corporation, dated
June 15, 1995, is incorporated by reference to Post-
Effective Amendment No. 25 to the Registration
Statement.
(h)(13) Fund Accounting Services Agreement between the
Registrant (on behalf of Scudder Global Bond Fund
(formerly Scudder Short Term Global Income Fund)) and
Scudder Fund Accounting Corporation, dated November
29, 1995, is incorporated by reference to Post-
Effective Amendment No. 26 to the Registration
Statement.
(h)(14) Fund Accounting Services Agreement between the
Registrant (on behalf of Scudder Emerging Markets
Income Fund) and Scudder Fund Accounting Corporation,
dated February 1, 1996, is incorporated by reference
to Post-Effective Amendment No. 27 to the
Registration Statement.
(h)(15) Administrative Agreement between the Registrant (on
behalf of Global/International Fund, Inc.) and
Scudder Kemper Investments, Inc., dated September 11,
2000, to be filed by post-effective amendment.
(14) Consents of Independent Accountants are filed
herewith.
(15) Inapplicable.
(16) Powers of Attorney are filed herewith.
(17) Form of Proxy is filed herewith.
Item 17. Undertakings.
------- -------------
(1) The undersigned Registrant agrees that prior to any public
reoffering of the securities registered through the use of a
prospectus which is a part of this registration statement by any
person or party who is deemed to be an underwriter within the
meaning of Rule 145(c) of the Securities Act of 1933 (the "1933
Act") [17 CFR 230.145c], the reoffering prospectus will contain the
information called for by the applicable registration form for
reofferings by persons who may be deemed underwriters, in addition
to the information called for by the other items of the applicable
form.
(2) The undersigned Registrant agrees that every prospectus that is
filed under paragraph (1) above will be filed as a part of an
amendment to the registration statement and will not be used until
the amendment is effective, and that, in determining any liability
under the 1933 Act, each post-effective amendment shall be deemed to
be a new registration statement for the securities offered therein,
and the offering of the securities at that time shall be deemed to
be the initial bona fide offering of them.
(3) The undersigned Registrant undertakes to file, by post-effective
amendment, an opinion of counsel supporting the tax consequences of
the proposed reorganization within a reasonable time after receipt
of such opinion.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933 and the
Investment Company Act of 1940, Global/International Fund, Inc. has duly caused
this Registration Statement on Form N-14 to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Boston and the
Commonwealth of Massachusetts on the 21st day of December, 2000.
GLOBAL/INTERNATIONAL FUND, INC.
By: /s/ Linda C. Coughlin
---------------------
Title: President
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement on Form N-14 has been signed below by the following
persons in the capacities and on the dates indicated.
SIGNATURE TITLE DATE
--------- ----- ----
/s/ Linda C. Coughlin President and Director December 21, 2000
--------------------------
Linda C. Coughlin
/s/ Henry P. Becton, Jr. * Director December 21, 2000
--------------------------
Henry P. Becton, Jr.
/s/ Dawn-Marie Driscoll * Director December 21, 2000
--------------------------
Dawn-Marie Driscoll
/s/ Edgar R. Fiedler * Director December 21, 2000
--------------------------
Edgar R. Fiedler
/s/ Keith R. Fox * Director December 21, 2000
--------------------------
Keith R. Fox
/s/ Joan E. Spero * Director December 21, 2000
--------------------------
Joan E. Spero
/s/ Jean Gleason Stromberg * Director December 21, 2000
----------------------------
Jean Gleason Stromberg
/s/ Jean C. Tempel * Director December 21, 2000
--------------------------
Jean C. Tempel
/s/ Steven Zaleznick * Director December 21, 2000
--------------------------
Steven Zaleznick
/s/ John R. Hebble Treasurer (Principal December 21, 2000
-------------------------- Financial and Accounting
John R. Hebble Officer)
*By: /s/ Joseph R. Fleming December 21, 2000
---------------------
Joseph R. Fleming, Attorney-in-fact
*Executed pursuant to powers of attorney filed herein as an exhibit to the
Registrant's Registration Statement on Form N-14.
<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
EXHIBITS
TO
FORM N-14
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
GLOBAL/INTERNATIONAL FUND, INC.
<PAGE>
GLOBAL/INTERNATIONAL FUND, INC.
EXHIBIT INDEX
Exhibit 10(m)(11) Scudder Funds Amended and Restated Multi-Distribution System
Plan
Exhibit 11 Opinion and Consent of Dechert
Exhibit 14 Consents of Independent Accountants
Exhibit 16 Powers of Attorney
Exhibit 17 Form of Proxy
