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Exhibit (a)(1)(i)
OFFER FOR CASH BY
THE INDIA GROWTH FUND INC.
UP TO 3,932,245 OF ITS ISSUED AND OUTSTANDING
SHARES OF COMMON STOCK
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M., NEW YORK CITY TIME,
ON FEBRUARY 16, 2001, UNLESS THE OFFER IS EXTENDED.
THIS ISSUER TENDER OFFER STATEMENT AND THE ACCOMPANYING LETTER OF
TRANSMITTAL (WHICH TOGETHER CONSTITUTE THE "OFFER") ARE NOT CONDITIONED ON ANY
MINIMUM NUMBER OF SHARES BEING TENDERED, BUT ARE SUBJECT TO OTHER CONDITIONS
AS OUTLINED HEREIN AND IN THE LETTER OF TRANSMITTAL.
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATIONS IN CONNECTION WITH THE OFFER OTHER THAN THOSE CONTAINED HEREIN
AND IN THE LETTER OF TRANSMITTAL, AND IF GIVEN OR MADE, SUCH INFORMATION OR
REPRESENTATIONS MAY NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE INDIA
GROWTH FUND INC. THE FUND HAS BEEN ADVISED THAT NO DIRECTOR OR EXECUTIVE
OFFICER OF THE FUND INTENDS TO TENDER ANY SHARES PURSUANT TO THE OFFER.
IMPORTANT
Any Stockholder desiring to tender any portion of his or her shares of
Common Stock of the Fund should either (1) complete and sign the Letter of
Transmittal in accordance with the instructions in the Letter of Transmittal,
and mail or deliver the Letter of Transmittal with his or her certificates for
the tendered Shares if such Stockholder has been issued physical certificates,
signature guarantees for all Stockholders tendering uncertificated Shares, and
any other required documents to the Depositary, or (2) request his or her
broker, dealer, commercial bank, trust company or other nominee to effect the
transaction for him. Stockholders having Shares registered in the name of a
broker, dealer, commercial bank, trust company or other nominee are urged to
contact such broker, dealer, commercial bank, trust company or other nominee
if they desire to tender Shares so registered.
Questions, requests for assistance and requests for additional copies of
this Issuer Tender Offer Statement and the Letter of Transmittal may be
directed to the Information Agent in the manner set forth on the last page of
this Issuer Tender Offer Statement.
January 16, 2001
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TABLE OF CONTENTS
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Page
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SUMMARY TERM SHEET....................................................... 1
Introduction............................................................. 3
1.Terms of the Offer; Termination Date.................................. 4
2. Acceptance for Payment and Payment for Shares........................ 5
3.Procedure for Tendering Shares........................................ 6
4.Rights of Withdrawal.................................................. 7
5.Source and Amount of Funds; Effect of the Offer....................... 8
6.Purpose of the Offer.................................................. 9
7.NAV and Market Price Range of Shares; Dividends....................... 10
8.Federal Income Tax Consequences of the Offer.......................... 11
9.Selected Financial Information........................................ 12
10.Certain Information Concerning the Fund and the Fund's Adviser........ 14
11.Interest of Directors and Officers; Transactions and Arrangements
Concerning the Shares................................................... 14
12.Certain Legal Matters; Regulatory Approvals........................... 14
13.Certain Conditions of the Offer....................................... 15
14.Fees and Expenses..................................................... 15
15.Miscellaneous......................................................... 15
16.Contacting the Depositary and the Information Agent................... 16
</TABLE>
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SUMMARY TERM SHEET
This Summary Term Sheet highlights certain information concerning this
tender offer. To understand the Offer fully and for a more complete discussion
of the terms and conditions of the offer, you should read carefully the entire
Issuer Tender Offer Statement and the related Letter of Transmittal.
What is the tender offer?
The India Growth Fund Inc. (the "Fund") is offering to purchase 40% of its
outstanding shares, or 3,932,245 of its outstanding shares of Common Stock,
for cash at a price per share equal to the per share net asset value as of the
close of regular trading on the New York Stock Exchange on February 16, 2001
(or, if the offer is extended, on the date to which the offer is extended)
upon specified terms and subject to conditions as set forth in the tender
offer documents.
When will the tender offer expire, and may the offer be extended?
The tender offer will expire at 5:00 p.m., New York City time, on February
16, 2001, unless extended. The Fund may extend the period of time the offer
will be open by issuing a press release or making some other public
announcement by no later than the next business day after the Offer otherwise
would have expired. See Section 1 of the Issuer Tender Offer Statement.
What is the net asset value per Fund share as of a recent date?
As of January 3, 2001, the net asset value per share was $13.54. See Section
7 of the Issuer Tender Offer Statement for details. During the pendency of the
tender offer, current net asset value quotations can be obtained from
Georgeson Shareholder Communication Inc. by calling toll free at 888-682-7298
or calling collect at 212-440-9800 between 9:00 a.m. and 5:00 p.m. Eastern
Time, Monday through Friday (except holidays).
Will the net asset value be higher or lower on the date that the price to be
paid for tendered shares is to be determined?
No one can accurately predict the net asset value at a future date.
How do I tender my shares?
If your shares are registered in your name, you should obtain the tender
offer materials, including the Issuer Tender Offer Statement and the related
Letter of Transmittal, read them, and if you should decide to tender, complete
a Letter of Transmittal and submit any other documents required by the Letter
of Transmittal. These materials must be received by PFPC Inc., the Depositary,
in proper form before 5:00 p.m., New York City time, on February 16, 2001
(unless the tender offer is extended by the Fund in which case the new
deadline will be as stated in the public announcement of the extension). If
your shares are held by a broker, dealer, commercial bank, trust company or
other nominee (e.g., in "street name"), you should contact that firm to obtain
the package of information necessary to make your decision, and you can only
tender your shares by directing that firm to complete, compile and deliver the
necessary documents for submission to the Depositary by February 16, 2001 (or
if the offer is extended, the expiration date as extended). See Section 3 of
the Issuer Tender Offer Statement.
Is there any cost to me to tender?
No fees or commission will be payable to the Fund in connection with the
Offer. However, brokers, dealers or other persons may charge stockholders a
fee for soliciting tenders for shares pursuant to this offer. See the Letter
of Transmittal.
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May I withdraw my shares after I have tendered them and, if so, by when?
Yes, you may withdraw your shares at any time prior to 5:00 p.m., New York
City time, on February 16, 2001 (or if the offer is extended, at any time
prior to 5:00 p.m., New York City time, on the new expiration date). Withdrawn
shares may be re-tendered by following the tender procedures before the offer
expires (including any extension period). See Section 4 of the Issuer Tender
Offer Statement.
How do I withdraw tendered shares?
A notice of withdrawal of tendered shares must be timely received by PFPC
Inc., which specifies the name of the stockholder who tendered the shares, the
number of shares being withdrawn (which must be all of the shares tendered)
and, as regards share certificates which represent tendered shares that have
been delivered or otherwise identified to PFPC Inc., the name of the
registered owner of such shares if different than the person who tendered the
shares. See Section 4 of the Issuer Tender Offer Statement.
May I place any conditions on my tender of shares?
No.
Is there a limit on the number of shares I may tender?
No, however only 40% of the Fund's outstanding shares will be accepted for
tender. See Section 1 of the Issuer Tender Offer Statement.
What if more than 3,932,245 shares are tendered (and not timely withdrawn)?
The Fund will purchase duly tendered shares from tendering stockholders
pursuant to the terms and conditions of the Offer on a pro rata basis
(disregarding fractions) in accordance with the number of shares tendered by
each stockholder (and not timely withdrawn), unless the Fund determines not to
purchase any shares. The Fund's present intention, if the Offer is
oversubscribed, is not to purchase more than 3,932,245 shares. See Section 1
of the Issuer Tender Offer Statement.
If I decide not to tender, how will the tender offer affect the Fund shares I
hold?
Your percentage ownership interest in the Fund will increase after
completion of the tender offer.
Does the Fund have the financial resources to make payment?
Yes. The Fund may borrow money to finance the purchase of any tendered
shares. See Section 5 of the Issuer Tender Offer Statement.
If shares I tender are accepted by the Fund, when will payment be made?
It is contemplated, subject to change, that payment for tendered shares, if
accepted, will be made on or about February 27, 2001.
Is my sale of shares in the tender offer a taxable transaction?
For most stockholders, yes. All U.S. stockholders other than those who are
tax exempt who sell shares in the tender offer will recognize gain or loss for
U.S. federal income tax purposes equal to the difference between the cash they
receive for the shares sold and their adjusted basis in the shares. The sale
date for tax purposes will be the date the Fund accepts shares for purchase.
See Section 8 of the Issuer Tender Offer Statement for details, including the
nature of the income or loss and the differing rules for U.S. and non-U.S.
stockholders. Please consult your tax adviser as well.
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Is the Fund required to complete the tender offer and purchase all shares
tendered up to the number of shares tendered for?
Under most circumstances, yes. There are certain circumstances, however, in
which the Fund will not be required to purchase any shares tendered as
described in Section 13 of the Issuer Tender Offer Statement.
Is there any reason shares tendered would not be accepted?
In addition to those circumstances described in Section 13 of the Issuer
Tender Offer Statement in which the Fund is not required to accept tendered
shares, the Fund has reserved the right to reject any and all tenders
determined by it not to be in appropriate form. Tenders will be rejected if
the tender does not include the original signature(s) or the original of any
required signature guarantee(s).
How will tendered shares be accepted for payment?
Properly tendered shares, up to the number tendered for, will be accepted
for payment by a determination of the Fund followed by notice of acceptance to
PFPC Inc. which is thereafter to make payment as directed by the Fund with
funds to be deposited with it by the Fund. See Section 2 of the Issuer Tender
Offer Statement.
What action need I take if I decide not to tender my shares?
None.
Does management encourage stockholders to participate in the tender offer, and
will they participate in the tender offer?
No. Neither the Fund, its Board of Directors, nor Unit Trust of India
Investment Advisory Services Limited (the "Adviser") is making any
recommendation to tender or not to tender shares in the tender offer. None of
the directors or officers of the Fund owns shares of the Fund, and therefore
no director or officer will be participating in the tender offer. See Section
6 of the Issuer Tender Offer Statement.
Will this be my last opportunity to tender shares to the Fund?
Possibly. As of the date of the Issuer Tender Offer Statement, the Fund did
not have any plans to conduct further tender offers in the future.
How do I obtain information?
Questions and requests for assistance should be directed to Georgeson
Shareholders Communications Inc., the Information Agent for the tender offer,
toll free at 888-682-7298 or call collect at 212-440-9800. Requests for
additional copies of the Issuer Tender Offer Statement, the Letter of
Transmittal and all other tender offer documents should also be directed to
the Information Agent for the tender offer, toll free at 888-682-7298. If you
do not own shares directly, you should obtain this information and the
documents from your broker, dealer, commercial bank, trust company or other
nominee, as appropriate.
To the Stockholders of Common Stock of The India Growth Fund Inc.
Introduction
The India Growth Fund Inc., a Maryland corporation (the "Fund") registered
under the Investment Company Act of 1940, as amended (the "1940 Act"), as a
closed-end, non-diversified management investment company, hereby offers to
purchase up to 40% of the Fund's outstanding shares of common stock or
3,932,245 shares in the aggregate (the "Offer Amount"), of its Common Stock,
par value $0.01 per share (the "Shares"), at a price (the "Purchase Price")
per Share, net to the seller in cash, equal to the net asset value in U.S.
dollars
("NAV") per share as of the close of regular trading on the New York Stock
Exchange ("NYSE") on
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February 16, 2001, or such later date to which the Offer is extended, upon the
terms and subject to the conditions set forth in this Issuer Tender Offer
Statement and in the related Letter of Transmittal (which together constitute
the "Offer"). The depositary for the Offer is PFPC Inc. (the "Depositary").
The Fund has mailed materials for the Offer to record holders on or about
January 16, 2001.
THIS OFFER IS BEING EXTENDED TO ALL STOCKHOLDERS OF THE FUND AND IS NOT
CONDITIONED ON ANY MINIMUM NUMBER OF SHARES BEING TENDERED, BUT IS SUBJECT TO
OTHER CONDITIONS AS OUTLINED HEREIN AND IN THE LETTER OF TRANSMITTAL.
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATIONS IN CONNECTION WITH THE OFFER OTHER THAN THOSE CONTAINED HEREIN
AND IN THE LETTER OF TRANSMITTAL, AND IF GIVEN OR MADE, SUCH INFORMATION OR
REPRESENTATIONS MAY NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE INDIA
GROWTH FUND INC. THE FUND HAS BEEN ADVISED THAT NO DIRECTOR OR EXECUTIVE
OFFICER OF THE FUND INTENDS TO TENDER ANY SHARES PURSUANT TO THE OFFER.
As of January 3, 2001, there were 9,830,611 Shares issued and outstanding,
and the NAV was $13.54 per Share. The Fund does not expect that the number of
shares issued and outstanding will be materially different on the Termination
Date. Stockholders may contact Georgeson Shareholder Communications Inc., the
Fund's Information Agent, toll free at 888-682-7298 or collect at 212-440-9800
to obtain current NAV quotations for the Shares.
Any Shares acquired by the Fund pursuant to the Offer will become authorized
but unissued Shares and will be available for issuance by the Fund without
further Stockholder action (except as required by applicable law). Tendering
Stockholders may be obligated to pay brokerage fees or commissions or, subject
to Instruction 6 of the Letter of Transmittal, transfer taxes on the purchase
of Shares by the Fund. Stockholders may also be subject to other transaction
costs, as described in Section 1.
1. Terms of the Offer; Termination Date. Upon the terms and subject to the
conditions set forth in the Offer, the Fund will accept for payment, and pay
for, up to 40% of the Fund's outstanding Shares validly tendered on or prior
to 5:00 p.m., New York City time, on February 16, 2001, or such later date to
which the Offer is extended (the "Termination Date"), and not withdrawn as
permitted by Section 4.
If the number of Shares properly tendered and not withdrawn prior to the
Termination Date is less than or equal to the Offer Amount, the Fund will,
upon the terms and conditions of the Offer, purchase all Shares so tendered.
If more than 3,932,245 Shares are duly tendered pursuant to the Offer (and not
withdrawn as provided in Section 4), unless the Fund determines not to
purchase any Shares, the Fund will purchase Shares from tendering
Stockholders, in accordance with the terms and conditions specified in the
Offer, on a pro rata basis (disregarding fractions), in accordance with the
number of Shares duly tendered by or on behalf of each Stockholder (and not so
withdrawn); however, the Fund will accept all Shares tendered by any
Stockholder who owns, beneficially or of record, an aggregate of not more than
99 Shares and who tenders all such Shares by means of the Letter of
Transmittal tendered by or on behalf of that Stockholder. If Shares duly
tendered by or on behalf of a Stockholder include Shares held pursuant to the
Fund's dividend reinvestment and cash purchase plan, the proration will be
applied first with respect to other Shares tendered and only thereafter, if
and as necessary, with respect to Shares held pursuant to that Plan. The Fund
does not contemplate extending the Offer and increasing the number of Shares
covered thereby by reason of more than 3,932,245 Shares having been tendered.
The Fund expressly reserves the right, in its sole discretion, at any time
or from time to time, to extend the period of time during which the Offer is
open by giving oral or written notice of such extension to the Depositary. Any
such extension will also be publicly announced by press release issued no
later than 9:00 a.m., New York City time, on the next business day after the
previously scheduled Termination Date. If the Fund makes a material change in
the terms of the Offer or the information concerning the Offer, or if it
waives a material condition of the Offer, the Fund will extend the Offer to
the extent required by Rules 13e-4(d)(2) and 13e-4(e)(2) under the
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Securities Exchange Act of 1934, as amended (the "Exchange Act"). During any
extension, all Shares previously tendered and not withdrawn will remain
subject to the Offer, subject to the right of a tendering Stockholder to
withdraw his or her Shares.
Subject to the terms and conditions of the Offer, the Fund will pay the
consideration offered or return the tendered securities promptly after the
termination or withdrawal of the Offer. Any extension, delay, termination, or
amendment will be followed as promptly as practicable by public announcement
thereof, such announcement, in the case of an extension, to be issued no later
than 9:00 a.m., New York City time, on the next business day after the
previously scheduled Termination Date.
2. Acceptance for Payment and Payment for Shares. Upon the terms and subject
to the conditions of the Offer, the Fund will accept for payment, and will pay
for, Shares validly tendered on or before the Termination Date and not
properly withdrawn in accordance with Section 4 as soon as practicable after
the Termination Date. In all cases, payment for Shares tendered and accepted
for payment pursuant to the Offer will be made only after timely receipt by
the Depositary of certificates for such Shares (unless such Shares are held in
uncertificated form), a properly completed and duly executed Letter of
Transmittal, and any other documents required by the Letter of Transmittal.
The Fund expressly reserves the right, in its sole discretion, to delay the
acceptance for payment of, or payment for, Shares, in order to comply, in
whole or in part, with any applicable law.
For purposes of the Offer, the Fund will be deemed to have accepted for
payment Shares validly tendered and not withdrawn as, if and when the Fund
gives oral or written notice to the Depositary of its acceptance for payment
of such Shares pursuant to the Offer. Payment for Shares accepted for payment
pursuant to the Offer will be made by deposit of the aggregate purchase price
therefor with the Depositary, which will act as agent for the tendering
Stockholders for purpose of receiving payments from the Fund and transmitting
such payments to the tendering Stockholders. Under no circumstances will
interest on the purchase price for Shares be paid, regardless of any delay in
making such payment.
If any tendered Shares are not accepted for payment pursuant to the terms
and conditions of the Offer for any reason, or are not paid because of an
invalid tender, or if certificates are submitted for more Shares than are
tendered (i) certificates for such unpurchased Shares will be returned,
without expense to the tendering Stockholder, as soon as practicable following
expiration or termination of the Offer, (ii) Shares delivered pursuant to the
Book-Entry Delivery Procedure (as defined in Section 3 below) will be credited
to the appropriate account maintained within the appropriate Book-Entry
Transfer Facility and (iii) uncertificated Shares held by the Fund's transfer
agent pursuant to the Fund's dividend reinvestment and cash purchase plan will
be returned to the dividend reinvestment and cash purchase plan account
maintained by the transfer agent.
If the Fund is delayed in its acceptance for payment of, or in its payment
for, Shares, or is unable to accept for payment or pay for Shares pursuant to
the Offer for any reason, then, without prejudice to the Fund's rights under
this Offer, the Depositary may, on behalf of the Fund, retain tendered Shares,
and such Shares may not be withdrawn unless and except to the extent tendering
Stockholders are entitled to withdrawal rights as described in Section 4.
The purchase price of the Shares will equal their NAV as of the close of
regular trading on the NYSE on February 16, 2001, or such later date to which
the Offer is extended (the "Pricing Date"). Tendering Stockholders may be
obliged to pay brokerage commissions or fees. Under the circumstances set
forth in Instruction 6 of the Letter of Transmittal, Stockholders may pay
transfer taxes on the purchase of Shares by the Fund.
The Fund normally calculates the NAV of its Shares weekly at the close of
regular trading on the NYSE. On January 3, 2001 the NAV was $13.54 per Share.
The Shares are listed on the NYSE. On January 3, 2001 the last sales price at
the close of regular trading on the NYSE was $11.50 per Share. The NAV of the
Fund's Shares will be available weekly through February 9, 2001 and daily from
February 12, 2001 until the Termination Date, through the Fund's Information
Agent toll free at 888-682-7298 or call collect at 212-440-9800.
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3. Procedure for Tendering Shares. Stockholders having Shares that are
registered in the name of a broker, dealer, commercial bank, trust company or
other nominee should contact such firm if they desire to tender their Shares.
For a Stockholder validly to tender Shares pursuant to the Offer, (a)(i) a
properly completed and duly executed Letter of Transmittal, together with any
required signature guarantees, and any other documents required by the Letter
of Transmittal, must be transmitted to and received by the Depositary at one
of its addresses set forth on the last page of this Issuer Tender Offer
Statement, and (ii) either the certificate for Shares must be transmitted to
and received by the Depositary at one of its addresses set forth on the last
page of this Issuer Tender Offer Statement, or the tendering Stockholder must
comply with the Book-Entry Delivery Procedure set forth in this Section 3, or
(b) Stockholders must comply with the Guaranteed Delivery Procedure set forth
in this Section 3, in all cases prior to the Termination Date.
The Fund's transfer agent holds Shares in uncertificated form for certain
Stockholders pursuant to the Fund's dividend reinvestment and cash purchase
plan. Stockholders may tender such uncertificated Shares by completing the
appropriate section of the Letter of Transmittal or Notice of Guaranteed
Delivery.
Signatures on Letters of Transmittal must be guaranteed by a member firm of
a registered national securities exchange or of the National Association of
Securities Dealers, Inc. (the "NASD"), or by a commercial bank or trust
company having an office, branch or agency in the United States (each an
"Eligible Institution") unless (i) the Letter of Transmittal is signed by the
registered holder of the Shares tendered, including those Stockholders who are
participants in a Book-Entry Transfer Facility and whose name appears on a
security position listing as the owner of the Shares, but excluding those
registered Stockholders who have completed either the "Special Payment
Instructions" box or the "Special Delivery Instructions" box on the Letter of
Transmittal, or (ii) such Shares are tendered for the account of an Eligible
Institution. In all other cases, all signatures on the Letter of Transmittal
must be guaranteed by an Eligible Institution. See Instruction 5 of the Letter
of Transmittal for further information.
To prevent U.S. federal income tax backup withholding on payments made for
the purchase of Shares purchased pursuant to the Offer, a Stockholder who does
not otherwise establish an exemption from such backup withholding must provide
the Depositary with his or her correct taxpayer identification number and
certify that he or she is not subject to backup withholding by completing the
Substitute Form W-9 included with the Letter of Transmittal. Foreign
Stockholders who have not previously submitted a Form W-8 to the Fund must do
so in order to avoid backup withholding. If the Fund's purchase of Shares were
treated as a dividend rather than an exchange with respect to a tendering
Stockholder, such Stockholder may be subject to backup withholding if the
Internal Revenue Service so advised the Fund, or if such Stockholder failed to
certify that such Stockholder is not subject to backup withholding. See
Section 8, "Federal Income Tax Consequences," below.
All questions as to the validity, form, eligibility (including time of
receipt), payment and acceptance for payment of any tender of Shares will be
determined by the Fund, in its sole discretion, which determination shall be
final and binding. The Fund reserves the absolute right to reject any and all
tenders of Shares it determines not to be in proper form or the acceptance for
payment of which may, in the opinion of its counsel, be unlawful. The Fund
also reserves the absolute right to waive any of the conditions of the Offer
or any defect or irregularity in the tender of any Shares. No tender of Shares
will be deemed to have been validly made until all defects and irregularities
have been cured or waived. Neither the Fund, the Fund's Adviser, the
Information Agent, the Depositary, nor any other person shall be under any
duty to give notification of any defects or irregularities in tenders, nor
shall any of the foregoing incur any liability for failure to give any such
notification. The Fund's interpretation of the terms and conditions of the
Offer (including the Letter of Transmittal and instructions thereto) will be
final and binding.
Payment for Shares tendered and accepted for payment pursuant to the Offer
will be made, in all cases, only after timely receipt of (i) certificates for
such Shares by the Depositary or book-entry confirmation of delivery of such
Shares to the account of the Depositary, (ii) a properly completed and duly
executed Letter of Transmittal for such Shares, and (iii) any other documents
required by the Letter of Transmittal. The tender of
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Shares pursuant to any of the procedures described in this Section 3 will
constitute an agreement between the tendering Stockholder and the Fund upon
the terms and subject to the conditions of the Offer.
The method of delivery of all required documents is at the election and risk
of each tendering Stockholder. If delivery is by mail, registered mail with
return receipt requested, properly insured, is recommended.
Book-Entry Delivery Procedure
The Depositary will establish accounts with respect to the Shares at the
Depository Trust Company (the "Book-Entry Transfer Facility") for purposes of
the Offer within two business days after the date of this Offer. Any financial
institution that is a participant in any of the Book-Entry Transfer Facility's
systems may make delivery of tendered Shares by (i) causing such Book-Entry
Transfer Facility to transfer such Shares into the Depositary's account in
accordance with such Book-Entry Transfer Facility's procedure for such
transfer and (ii) causing a confirmation of receipt of such delivery to be
received by the Depositary (the "Book-Entry Delivery Procedure"). The Book-
Entry Transfer Facility may charge the account of such financial institution
for tendering Shares on behalf of Stockholders. Notwithstanding that delivery
of Shares may be properly effected in accordance with this Book-Entry Delivery
Procedure, the Letter of Transmittal, with signature guarantee, if required,
and all other documents required by the Letter of Transmittal must be
transmitted to and received by the Depositary at the appropriate address set
forth on the last page of this Offer before the Termination Date, or the
tendering Stockholder must comply with the Guaranteed Delivery Procedure set
forth below. Delivery of documents to a Book-Entry Transfer Facility in
accordance with such Book-Entry Transfer Facility's procedures does not
constitute delivery to the Depositary for purposes of this Offer.
Guaranteed Delivery Procedure
If certificates for Shares are not immediately available or time will not
permit the Letter of Transmittal and other required documents to reach the
Depositary prior to the Termination Date, Shares may be properly tendered
provided that (i) such tenders are made by or through an Eligible Institution
and (ii) the Depositary receives, prior to the Termination Date, a properly
completed and duly executed Notice of Guaranteed Delivery substantially in the
form provided by the Fund (delivered by hand, mail or telegram) and (iii) the
certificates for all tendered Shares, or confirmation of the delivery of
Shares delivered into the Depositary's account in accordance with such Book-
Entry Transfer Facility's procedure for such transfer, together with a
properly completed and duly executed Letter of Transmittal and any other
documents required by the Letter of Transmittal, are received by the
Depositary within three business days after the Termination Date (the
"Guaranteed Delivery Deadline").
4. Rights of Withdrawal. Tenders of Shares made pursuant to the Offer may be
withdrawn at any time prior to the Termination Date (including any date to
which the Offer is extended). After the Termination Date (including any date
to which the Offer is extended), all tenders made pursuant to the Offer are
irrevocable.
To be effective, a written or telegraphic notice of withdrawal must be
timely received by the Depositary at one of its addresses set forth on the
last page of this Issuer Tender Offer Statement. Any notice of withdrawal must
specify the name of the person who executed the particular Letter of
Transmittal or Notice of Guaranteed Delivery, the number of Shares to be
withdrawn, and the names in which the Shares to be withdrawn are registered.
Any signature on the notice of withdrawal must be guaranteed by an Eligible
Institution. If certificates have been delivered to the Depositary, the name
of the registered holder and the serial numbers of the particular certificates
evidencing the Shares withdrawn must also be furnished to the Depositary. If
Shares have been delivered pursuant to the Book-Entry Delivery Procedure set
forth in Section 3, any notice of withdrawal must specify the name and number
of the account at the appropriate Book-Entry Transfer Facility to be credited
with the withdrawn Shares (which must be the same name, number, and Book-Entry
Transfer Facility from which the Shares were tendered), and must comply with
the procedures of that Book-Entry Transfer Facility.
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All questions as to the form and validity, including time of receipt, of any
notice of withdrawal will be determined by the Fund, in its sole discretion,
which determination shall be final and binding. Neither the Fund, the Fund's
Adviser, the Information Agent, the Depositary, nor any other person shall be
under any duty to give notification of any defects or irregularities in any
notice of withdrawal, nor shall any of the foregoing incur any liability for
failure to give such notification. Any Shares properly withdrawn will be
deemed not to have been validly tendered for purposes of the Offer. However,
withdrawn Shares may be re-tendered by following the procedures described in
Section 3 at any time prior to the Termination Date.
If the Fund is delayed in its acceptance for payment of Shares, or is unable
to accept for payment Shares tendered pursuant to the Offer, for any reason,
then, without prejudice to the Fund's rights under the Offer, the Depositary
may, on behalf of the Fund, retain tendered Shares, and such Shares may not be
withdrawn except to the extent that tendering Stockholders are entitled to
withdrawal rights as set forth in this Section 4.
5. Source and Amount of Funds; Effect of the Offer. The actual cost to the
Fund cannot be determined at this time because the number of Shares to be
purchased will depend on the number tendered, and the price will be based on
the NAV per Share on the Pricing Date. If the NAV per Share on the Pricing
Date were the same as the NAV per Share on January 3, 2001, and if
Stockholders tender 40% of the Fund's outstanding Shares pursuant to the
Offer, the estimated payments by the Fund to the Stockholders would be
approximately $53,242,597.30. See the Pro Forma Capitalization table below.
The monies to be used by the Fund to purchase Shares pursuant to the Offer
will be obtained from cash and from sales of securities in the Fund's
investment portfolio. In addition, the fund may borrow money to finance the
purchase of any tendered shares.
The Offer may have certain adverse consequences for tendering and non-
tendering Stockholders.
Effect on NAV and Consideration Received by Tendering Stockholders. If the
Fund is required to sell a substantial amount of portfolio securities to raise
cash to finance the Offer, the market prices of the Fund's portfolio
securities, and hence the Fund's NAV, may decline. If such a decline occurs,
the Fund cannot predict what its magnitude might be or whether such a decline
would be temporary or continue to or beyond the Termination Date. Because the
price per Share to be paid in the Offer will be dependent upon the NAV per
Share as determined on the Termination Date, if such a decline continued up to
the Termination Date, the consideration received by tendering Stockholders
would be reduced. In addition, the sale of portfolio securities will cause
increased brokerage and related transaction expenses, and the Fund may receive
proceeds from the sale of portfolio securities less than their valuations by
the Fund. Accordingly, because of the Offer, the Fund's NAV per Share may
decline more than it otherwise might, thereby reducing the amount of proceeds
received by tendering Stockholders and the value per Share for non-tendering
Stockholders.
The Fund will likely sell portfolio securities during the pendency of the
Offer to raise cash for the purchase of Shares. Thus, during the pendency of
the Offer, and possibly for a short time thereafter, the Fund will hold a
greater than normal percentage of its net assets in cash and cash equivalents.
The Fund is required by law to pay for tendered Shares it accepts for payment
promptly after the Termination Date of the Offer. Because the Fund will not
know the number of Shares tendered until the Termination Date, the Fund will
not know until the Termination Date the amount of cash required to pay for
such Shares. If on or prior to the Termination Date the Fund does not have, or
believes it is unlikely to have, sufficient cash to pay for all Shares
tendered, it may extend the Offer to allow additional time to sell portfolio
securities and raise sufficient cash.
Recognition of Capital Gains. As noted, the Fund will likely be required to
sell portfolio securities pursuant to the Offer. If the Fund's tax basis for
the securities sold is less than the sale proceeds, the Fund will recognize
capital gains. The Fund would expect to declare and distribute any such gains
to Stockholders of record (reduced by net capital losses realized during the
fiscal year, if any), during 2001. This recognition and distribution of gains,
if any, would have two negative consequences: first, Stockholders at the time
of a declaration of distributions would be required to pay taxes on a greater
amount of capital gain distributions than
8
<PAGE>
otherwise would be the case; and second, to raise cash to make the
distributions, the Fund might need to sell additional portfolio securities,
thereby possibly being forced to realize and recognize additional capital
gains. It is impossible to predict what the amount of unrealized gains or
losses would be in the Fund's portfolio at the time that the Fund is required
to liquidate portfolio securities (and hence the amount of capital gains or
losses that would be realized and recognized). As of December 31, 2000, there
was unrealized appreciation of $23,651,380 in the Fund's portfolio as a whole
(net of deferred withholding taxes).
In addition, some of the distributed gains may be realized on securities
held for one year or less, which would generate income taxable to the
Stockholders at ordinary income rates. This could adversely affect the Fund's
after-tax performance.
Tax Consequences of Repurchases to Stockholders. The Fund's purchase of
tendered Shares pursuant to the Offer will have tax consequences for tendering
Stockholders and may have tax consequences for non-tendering Stockholders. See
Section 8, "Federal Income Tax Consequences," below.
Higher Expense Ratio and Less Investment Flexibility. If the Fund purchases
a substantial number of Shares pursuant to the Offer, the net assets of the
Fund would be reduced accordingly. The reduced net assets of the Fund as a
result of the Offer will result in a higher expense ratio for the Fund, and
possibly in less investment flexibility for the Fund, depending on the number
of Shares repurchased.
Pro Forma Effects on Capitalization. The following table sets forth the net
assets of the Fund as of December 31, 2000, adjusted to give effect to the
Offer (excluding expenses and assuming the Fund repurchases 40% of its
outstanding Shares):
PRO FORMA CAPITALIZATION (1)
<TABLE>
<CAPTION>
Adjustment
As of for Purchase
December 31, at $13.54 Pro Forma
2000 Per Share (2) As Adjusted
------------ ------------- --------------
<S> <C> <C> <C>
Total net assets...................... $132,722,330 $133,098,404 $79,853,806.70
Shares outstanding.................... 9,830,611 9,830,611 5,898,366
NAV per Share (3)..................... $ 13.50 $ 13.54 $ 13.54
</TABLE>
--------
(1) This table assumes purchase by the Fund of 3,932,245 Shares, equal to 40%
of the Fund's Shares outstanding on January 3, 2001.
(2) This amount represents the Fund's NAV as determined on January 3, 2001.
Shares tendered pursuant to the Offer will be purchased at NAV on the
Pricing Date, which may be more or less than $13.54 per Share, and the
pro forma NAV per Share also may be more or less.
(3) The NAV per Share of the Fund is normally determined weekly as of the
close of regular trading on the NYSE, and is determined by dividing the
total net assets of the Fund by the number of Shares outstanding.
6. Purpose of the Offer. The Board of Directors has consistently recognized
that it would be in the best interests of Stockholders to attempt to reduce or
eliminate any discount at which the Fund's Shares may trade to their NAV. On
October 23, 2000, the Board determined to conduct a tender offer for Shares of
the Fund's common stock to attempt to reduce the market discount at which the
Fund's Shares trade to their NAV. The tender offer is being conducted in lieu
of the share repurchase program previously announced on August 21, 2000 and
September 6, 2000.
Any Shares acquired by the Fund pursuant to the Offer will become authorized
but unissued Shares and will be available for issuance by the Fund without
further Stockholder action (except as required by applicable law or the rules
of national securities exchanges on which the Shares are listed).
9
<PAGE>
NEITHER THE FUND, NOR ITS BOARD OF DIRECTORS, NOR THE ADVISER, MAKES ANY
RECOMMENDATION TO ANY STOCKHOLDER AS TO WHETHER TO TENDER OR REFRAIN FROM
TENDERING ANY OF SUCH STOCKHOLDER'S SHARES AND NONE OF SUCH PERSONS HAS
AUTHORIZED ANY PERSON TO MAKE ANY SUCH RECOMMENDATION. STOCKHOLDERS ARE URGED
TO EVALUATE CAREFULLY ALL INFORMATION IN THE OFFER, CONSULT THEIR OWN
INVESTMENT AND TAX ADVISERS AND MAKE THEIR OWN DECISIONS WHETHER TO TENDER
SHARES.
7. NAV and Market Price Range of Shares; Dividends. The Shares are traded on
the NYSE. During each fiscal quarter of the Fund during the past two fiscal
years, the NAV (as of the last day of such fiscal quarter), and the High, Low
and Close Market Price per Share (as of the last day of such fiscal quarter)
were as follows:
<TABLE>
<CAPTION>
Market Price
----------------------- Net Asset
Fiscal Quarter Ended High Low Close Value
-------------------- ------- ------- ------- ---------
<S> <C> <C> <C> <C>
December 31, 1998............................. $7.8125 $7.6875 $ 7.750 $10.63
March 31, 1999................................ 10.250 10.1875 10.250 14.52
June 30, 1999................................. 9.5625 9.375 9.5625 13.55
September 30, 1999............................ 11.8125 11.625 11.8125 16.93
December 31, 1999............................. 15.375 15.125 15.250 22.58
March 31, 2000................................ 16.125 15.8125 15.875 25.49
June 30, 2000................................. 11.500 11.375 11.375 17.75
September 30, 2000............................ 11.1875 10.9375 11.1875 15.33
December 31, 2000............................. 11.250 11.0 11.250 13.50
</TABLE>
At January 3, 2001, the Fund's NAV reflected $3,553,309 in aggregate net
deferred Indian withholding taxes accrued by the Fund through that date. This
accrual reflects the fact that remittances to the Fund from the Fund's trust
fund arrangement (the "Trust") in India (through which it invests in Indian
securities) representing net investment income and gains on Indian investments
are subject to a 10% Indian withholding tax. On November 8, 2000, the amount
of the accrual for net deferred Indian withholding taxes was reduced by
$4,103,496 (from $9,347,726 to $5,244,230) in connection with the Fund's
announcement of the Offer, contributing an aggregate increase of $4,103,496
(or $0.42 per share) in the Fund's NAV as of that date. This reduction in the
accrued net deferred withholding tax reflected the fact that under current
Indian tax law, dividend distributions made between April 1999 and March 2002
from the Trust to the Fund are exempt from the 10% withholding tax, and the
fact that at November 8, 2000, the Trust had approximately $41,034,960 of
undistributed net investment income and accumulated realized gains calculated
in accordance with Indian tax regulations, which were available for
distribution by the Trust as a dividend to the Fund in order to make payment
for tendered shares and to pay the distribution declared by the Fund which is
payable on January 12, 2001. The 10% Indian withholding tax will not be
accrued (and the previously accrued deferred withholding tax in a similar
amount will be reversed) on any net investment income and realized gains
generated by the Trust subsequent to November 8, 2000, to the extent such
income and gains will be distributed by the Trust to pay for tendered shares
or the January 12, 2001 distribution. To the extent that the Fund requires
further funds to pay for tendered shares, it may be necessary for the Fund to
redeem units it holds in the Trust, and the remittance of such redemption
proceeds may not be exempt from the 10% withholding tax. Although the Fund has
taken action to obtain benefits under the double taxation treaty between
Mauritius and India, under which the redemption of units in the Trust would
not be subject to capital gains tax in India, due to uncertainty surrounding
the availability to the Fund of such benefits, the Fund is continuing to
accrue the 10% withholding tax in India on investment income and realized and
unrealized gains which it does not anticipate distributing to the Fund. The
Fund is seeking to obtain confirmation from Indian tax authorities that it
will not be subject to capital gains tax in India on the redemption of units
(as a result of the Mauritius/India double taxation treaty), but there is no
assurance that this confirmation will be obtained or that this tax benefit
will be available to the Fund.
10
<PAGE>
THE FUND DECLARED A CASH DIVIDEND OF $0.4668 PER SHARE ON DECEMBER 18, 2000,
WITH A RECORD DATE OF DECEMBER 28, 2000 AND A PAYMENT DATE OF JANUARY 12,
2001. IT IS ANTICIPATED THAT NO FURTHER DIVIDENDS WILL BE DECLARED BY THE
BOARD OF DIRECTORS WITH A RECORD DATE OCCURRING BEFORE THE EXPIRATION OF THE
OFFER AND THAT, ACCORDINGLY, HOLDERS OF SHARES PURCHASED PURSUANT TO THE OFFER
WILL NOT RECEIVE ANY SUCH FURTHER DIVIDEND WITH RESPECT TO SUCH SHARES. THE
AMOUNT AND FREQUENCY OF DIVIDENDS IN THE FUTURE WILL DEPEND ON CIRCUMSTANCES
EXISTING AT THAT TIME.
8. Federal Income Tax Consequences of the Offer. The U.S. federal income tax
discussion set forth below is a summary included for general information
purposes only. In view of the individual nature of tax consequences, each
Stockholder is advised to consult its own tax adviser with respect to the
specific tax consequences to it of participation in the Offer, including the
effect and applicability of state, local, foreign, and other tax laws and the
possible effects of changes in federal or other tax laws.
The sale of Shares pursuant to the Offer will be a taxable transaction for
U.S. federal income tax purposes, either as a "sale or exchange," or under
certain circumstances, as a "dividend." Under Section 302(b) of the Internal
Revenue Code of 1986, as amended (the "Code"), a sale of Shares pursuant to
the Offer generally will be treated as a "sale or exchange" if the receipt of
cash by the Stockholder: (a) results in a "complete termination" of the
Stockholder's interest in the Fund, (b) is "substantially disproportionate"
with respect to the Stockholder, or (c) is "not essentially equivalent to a
dividend" with respect to the Stockholder. In determining whether any of these
tests has been met, Shares actually owned, as well as Shares considered to be
owned by the Stockholder by reason of certain constructive ownership rules set
forth in Section 318 of the Code, generally must be taken into account. If any
of these three tests for "sale or exchange" treatment is met, a Stockholder
will recognize gain or loss equal to the difference between the price paid by
the Fund for the Shares purchased in the Offer and the Stockholder's adjusted
basis in such Shares. If such Shares are held as a capital asset, the gain or
loss will be capital gain or loss. The maximum tax rate applicable to net
capital gains recognized by individuals and other non-corporate taxpayers is
(i) the same as the applicable ordinary income rate for capital assets held
for one year or less or (ii) 20% for capital assets held for more than one
year.
If the requirements of Section 302(b) of the Code are not met, amounts
received by a Stockholder who sells Shares pursuant to the Offer will be
taxable to the Stockholder as a "dividend" to the extent of such Stockholder's
allocable share of the Fund's current or accumulated earnings and profits. To
the extent that amounts received exceed such Stockholder's allocable share of
the Fund's current and accumulated earnings and profits, such excess will
constitute a non-taxable return of capital (to the extent of the Stockholder's
adjusted basis in the Shares sold pursuant to the Offer) and any amounts in
excess of the Stockholder's adjusted basis will constitute taxable gain. Any
remaining adjusted basis in the Shares tendered to the Fund will be
transferred to any remaining Shares held by such Stockholder. In addition, if
a tender of Shares is treated as a "dividend" to a tendering Stockholder, a
constructive dividend under Section 305(c) of the Code may result to a non-
tendering Stockholder whose proportionate interest in the earnings and assets
of the Fund has been increased by such tender. The Fund believes that the
nature of the repurchase will be such that the sale of Shares pursuant to the
Offer will normally satisfy the test for a sale that is "not essentially
equivalent to a dividend" and therefore will qualify for "sale or exchange"
treatment (as opposed to "dividend" treatment).
Foreign Stockholders. Generally payments to a tendering Stockholder who is a
nonresident alien individual, a foreign trust or estate or a foreign
corporation that does not hold his, her or its shares in connection with a
trade or business conducted in the United States (a "Foreign Stockholder")
that are treated as dividends for U.S. federal income tax purposes under the
rules set forth above, will be subject to U.S. withholding tax at the rate of
30% (unless a reduced rate applies under an applicable tax treaty or statute).
A tendering Foreign Stockholder who realizes a capital gain on a tender of
Shares will not be subject to U.S. federal income tax on such gain, unless the
Stockholder is an individual who is physically present in the United States
for 183 days or more and certain other conditions exist. Such persons are
advised to consult their own tax adviser. Special rules may apply in the case
of Foreign Stockholders (i) that are engaged in a U.S. trade or business, (ii)
that are former
11
<PAGE>
citizens or residents of the U.S. or (iii) that are "controlled foreign
corporations," "foreign personal holding companies," corporations that
accumulate earnings to avoid U.S. federal income tax, and certain foreign
charitable organizations. Such persons are advised to consult their own tax
adviser.
Backup Withholding. The Fund generally will be required to withhold tax at
the rate of 31% ("backup withholding") from any payment to a tendering
Stockholder that is an individual (or certain other non-corporate persons) if
the Stockholder fails to provide to the Fund its correct taxpayer
identification number. If the payment by the Fund to any such Stockholder is
treated as a dividend rather than a "sale or exchange" as described above,
backup withholding also will be required with respect to that payment if the
Internal Revenue Service advises the Fund that the Stockholder is subject to
backup withholding for prior underreporting of reportable interest or dividend
payments or if the Stockholder fails to certify that it is not subject
thereto. A foreign Stockholder generally will be able to avoid backup
withholding with respect to payments by the Fund that are treated as made in
exchange for tendered Shares only if it furnishes to the Fund a duly completed
Form W-8, signed under penalty of perjury, stating that it (1) is neither a
citizen nor a resident of the United States, (2) has not been and reasonably
does not expect to be present in the United States for a period aggregating
183 days or more during the calendar year, and (3) reasonably expects not to
be engaged in a trade or business within the United States to which the gain
on sale of the Shares would be effectively connected. Backup withholding is
not an additional tax, and any amounts withheld may be credited against a
Stockholder's U.S. federal income tax liability.
9. Selected Financial Information. Set forth below is a summary of selected
financial information for the Fund as of and for the fiscal years ended June
30, 2000 and June 30, 1999. The information with respect to the two fiscal
years has been excerpted from the Fund's audited financial statements
contained in its Annual Reports to Stockholders for these years. These reports
have previously been provided to Stockholders of the Fund. Copies of the two
audited statements can be obtained for free at the website of the Commission
(http://www.sec.gov). The summary of selected financial information set forth
below is qualified in its entirety by reference to such statements and the
financial information, the notes thereto and related matter contained therein.
12
<PAGE>
SUMMARY OF SELECTED FINANCIAL INFORMATION
For the Periods Indicated Below
<TABLE>
<CAPTION>
Year Ended Year Ended
June 30, 2000 June 30, 1999
------------- -------------
(Audited) (Audited)
<S> <C> <C>
STATEMENT OF OPERATIONS
Investment income................................ $ 2,226,116 $ 1,702,139
Expenses......................................... 3,728,705 (2,491,585)
------------ ------------
Net investment loss before taxes................. (1,502,589) (1,126,106)
Deferred Indian withholding tax expense.......... (17,189) 336,660
------------ ------------
Net investment loss.............................. (1,519,778) (789,446)
------------ ------------
Net realized gain on investments (net of deferred
Indian withholding tax of $1,892,106 and
$905,933 respectively).......................... 14,011,523 5,088,572
------------ ------------
Net realized loss on foreign currency
transactions.................................... (261,368) 21,856
------------ ------------
Net change in unrealized
appreciation/depreciation of:
------------ ------------
(a)Investments (net of increase in deferred
Indian withholding tax of $2,675,635 and
$3,836,866 respectively)....................... 29,206,232 34,720,506
(b)Other assets and liabilities denominated in
Indian Rupees (154,019) (193,444)
Net realized and unrealized gain on investments
and foreign currency transactions............... 42,802,368 39,637,490
------------ ------------
Net increase in net assets from investment
operations...................................... 41,282,590 38,848,044
------------ ------------
STATEMENTS OF ASSETS AND LIABILITIES (AT END OF
PERIOD)
Total assets.................................... 188,065,082 147,458,542
Total liabilities............................... 13,540,519 14,216,569
------------ ------------
Net assets...................................... 174,524,563 133,241,973
------------ ------------
Net asset value per Share....................... $ 17.75 $ 13.55
Shares outstanding.............................. 9,830,611 9,830,611
SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT
EACH PERIOD
Net asset value, beginning of year............... $ 13.55 $ 9.56
------------ ------------
Income (Loss) Investment Operations
Net investment income loss (before tax)......... $ (0.15) $ (0.11)
Net deferred Indian withholding (tax)/tax
benefit on net investment income (loss)........ (0.00)* 0.03
------------ ------------
Net realized and unrealized gain (loss) on
investments and foreign currency transactions.. 4.82 4.51
------------ ------------
Deferred Indian withholding (tax)/tax benefit on
net realized and unrealized loss on
investments.................................... (0.47) (0.48)
Total income (loss) from investment operations.. 4.20 3.95
------------ ------------
Capital Share Transactions
Capital contributions from Investment Adviser.... -- 0.04
------------ ------------
Net asset value, end of year..................... $ 17.75 $ 13.55
============ ============
Market value, end of year........................ $ 11.38 $ 9.56
============ ============
Total investment return (a)...................... 19.04% 31.90%
============ ============
Ratios/Supplemental Data
Net assets, end of year (000 omitted)............ $ 174,525 $ 133,242
Ratio of expenses, excluding (tax) tax benefit,
to average net assets (b)....................... 1.94% 2.51%
Ratio of expenses, including (tax) tax benefit,
to average net assets (c)....................... 1.95% 2.21%
Ratio of net investment income (loss) to average
net assets...................................... (0.79)% (0.70)%
Portfolio turnover............................... 20% 30%
</TABLE>
--------
(*) Net deferred Indian withholding tax on net investment income for Indian
tax purposes equivalent to $0.0017 per share.
(a) Total investment return is calculated assuming a purchase of common stock
at the current market price on the first day, the purchase of common
stock pursuant to any rights offering occurring in the year and a sale at
the current market price on the last day of each year reported. Dividends
and distributions, if any, are assumed, for purposes of this calculation,
to be reinvested at prices obtained under the Fund's dividend
reinvestment plan. Total investment return does not reflect sales charges
or brokerage commissions.
13
<PAGE>
(b) Includes interest expenses of $156,345 (or 0.08% of average net assets)
and $153,641 (or 0.14% of average net assets) for the years ended June
30, 2000 and 1999, respectively.
(c) Includes interest expense net of deferred Indian withholding tax benefit
of $140,711 (or 0.07% of average net assets) and $138,277 (or 0.12% of
average net assets) for the years ended June 30, 2000 and 1999,
respectively.
10. Certain Information Concerning the Fund and the Fund's Adviser. The Fund
is a closed-end, non-diversified management investment company organized as a
Maryland corporation. The Shares were first issued to the public on August 2,
1988. As a closed-end investment company, the Fund differs from an open-end
investment company (i.e., a mutual fund) in that it does not redeem its Shares
at the election of a Stockholder and does not continuously offer its Shares
for sale to the public. The Fund's investment objective is to seek long-term
capital appreciation through investment primarily in equity securities of
Indian companies.
Unit Trust of India Investment Advisory Services Ltd, serves as Adviser to
the Fund. The Adviser is a wholly-owned subsidiary of the Unit Trust of India
and a registered investment adviser under the Investment Advisers Act of 1940,
as amended (the "Advisers Act"). The Adviser has served as Adviser since the
Fund's inception. The principal business address of the Adviser is Commerce
Centre 1, World Trade Center, 8th Floor, G.D. Somani Marg, Cuffe Parade,
Colaba, Mumbai, 400-005, India.
The Fund is subject to the information and reporting requirements of the
1940 Act and in accordance therewith is obligated to file reports and other
information with the Commission relating to its business, financial condition
and other matters. The Fund has also filed an Issuer Tender Offer Statement on
Schedule TO with the Commission. Such reports and other information should be
available for inspection at the public reference room at the Commission's
office at 450 Fifth Street, N.W., Judiciary Plaza, Washington, D.C., and also
should be available for inspection and copying at the following regional
offices of the Commission: Northwestern Atrium Center, 500 West Madison
Street, Suite 1400, Chicago, Illinois; 7 World Trade Center, New York, New
York. The Fund's filings are also available to the public on the Commission's
internet site (http://www.sec.gov). Copies may be obtained, by mail, upon
payment of the Commission's customary charges, by writing to its principal
office at 450 Fifth Street, N.W., Judiciary Plaza, Washington, D.C. 20549.
11. Interest of Directors and Officers; Transactions and Arrangements
Concerning the Shares. None of the directors or officers of the Fund owns
Shares. Neither the Fund nor any subsidiary of the Fund nor, to the best of
the Fund's knowledge, any of the Fund's officers or directors, has effected
any transaction in Shares during the past 60 business days.
Except as set forth in the Offer, neither the Fund, nor, to the best of the
Fund's knowledge, any of the Fund's officers or directors, is a party to any
contract, arrangement, understanding or relationship with any other person
relating, directly or indirectly to the Offer with respect to any securities
of the Fund, including, but not limited to, any contract, arrangement,
understanding or relationship concerning the transfer or the voting of any
such securities, joint ventures, loan or option arrangements, puts or calls,
guaranties of loans, guaranties against loss or the giving or withholding of
proxies, consents or authorizations.
12. Certain Legal Matters; Regulatory Approvals. The Fund is not aware of
any approval or other action by any government or governmental, administrative
or regulatory authority or agency, domestic or foreign, that would be required
for the acquisition or ownership of Shares by the Fund as contemplated herein.
Should any such approval or other action be required, the Fund presently
contemplates that such approval or other action will be sought. The Fund is
unable to predict whether it may determine that it is required to delay the
acceptance for payment of, or payment for, Shares tendered pursuant to the
Offer pending the outcome of any such matter. There can be no assurance that
any such approval or other action, if needed, would be obtained without
substantial conditions or that the failure to obtain any such approval or
other action might not result in adverse consequences to the Fund's business.
The Fund's obligations under the Offer to accept for payment and pay for
Shares are subject to certain conditions described in Section 13.
14
<PAGE>
13. Certain Conditions of the Offer. Notwithstanding any other provision of
the Offer, the Fund shall not be required to accept for payment or pay for any
Shares, may postpone the acceptance for payment of, or payment for, tendered
Shares, and may, in its reasonable discretion, terminate or amend the Offer as
to any Shares not then paid for if (1) such transactions, if consummated,
would (a) result in delisting of the Fund's Common Stock from the NYSE or (b)
impair the Fund's status as a regulated investment company under the Code
(which would make the Fund subject to U.S. federal income taxes on all of its
income and gains in addition to the taxation of Stockholders who receive
distributions from the Fund); (2) the amount of shares of Common Stock
tendered would require liquidation of such a substantial portion of the Fund's
securities that the Fund would not be able to liquidate portfolio securities
in an orderly manner in light of the existing market conditions and such
liquidation would have an adverse effect on the NAV of the Fund to the
detriment of non-tendering Stockholders; (3) there is any (a) in the Board of
Directors' judgment, material legal action or proceeding instituted or
threatened challenging such transactions or otherwise materially adversely
affecting the Fund, (b) suspension of or limitation on prices for trading
securities generally on the NYSE or other national securities exchange(s), or
the NASDAQ National Market System, (c) declaration of a banking moratorium by
federal or state authorities or any suspension of payment by banks in the
United States or New York State, (d) limitation affecting the Fund or the
issuers of its portfolio securities imposed by federal or state authorities on
the extension of credit by lending institutions, (e) commencement of war,
armed hostilities or other international or national calamity directly or
indirectly involving the United States, or (f) in the Board of Directors'
judgment, other event or condition which would have a material adverse effect
on the Fund or its Stockholders if tendered Shares were purchased; or (4) the
Board of Directors determines that effecting any such transaction would
constitute a breach of their fiduciary duty owed to the Fund or its
Stockholders.
The foregoing conditions are for the sole benefit of the Fund and may be
asserted by the Fund regardless of the circumstances (including any action or
inaction by the Fund) giving rise to any such conditions or may be waived by
the Fund in whole or in part at any time and from time to time in its sole
discretion. The failure by the Fund at any time to exercise any of the
foregoing rights shall not be deemed a waiver of any such right and each such
right shall be deemed an ongoing right which may be asserted at any time and
from time to time. Any determination by the Fund concerning the events
described in this Section shall be final and binding on all parties.
A public announcement shall be made of a material change in, or waiver of,
such conditions, and the Offer may, in certain circumstances, be extended in
connection with any such change or waiver.
If the Offer is suspended or postponed, the Fund will provide notice to
Stockholders of such suspension or postponement.
14. Fees and Expenses. The Fund will not pay to any broker or dealer,
commercial bank, trust company or other person any solicitation fee for any
Shares purchased pursuant to the Offer. The Fund will reimburse such persons
for customary handling and mailing expenses incurred in forwarding the Offer.
No such broker, dealer, commercial bank or trust company has been authorized
to act as the agent of the Fund or the Depositary for purposes of the Offer.
The Fund has retained PFPC Inc. to act as Depositary and Georgeson
Shareholder Communications Inc. to act as Information Agent. The Depositary
and the Information Agent will each receive reasonable and customary
compensation for their services and will also be reimbursed for certain out-
of-pocket expenses, and the Information Agent will be indemnified against
certain liabilities by the Fund.
15. Miscellaneous. The Offer is not being made to (nor will tenders be
accepted from or on behalf of) holders of Shares in any jurisdiction in which
the making of the Offer or the acceptance thereof would not be in compliance
with the laws of such jurisdiction. The Fund may, in its sole discretion, take
such action as it may deem necessary to make the Offer in any such
jurisdiction.
The Fund is not aware of any jurisdiction in which the making of the Offer
or the acceptance of Shares in connection therewith would not be in compliance
with the laws of such jurisdiction. Consequently, the Offer is
15
<PAGE>
currently being made to all holders of Shares. However, the Fund reserves the
right to exclude Stockholders in any jurisdiction in which it is asserted that
the Offer cannot lawfully be made. So long as the Fund makes a good faith
effort to comply with any state law deemed applicable to the Offer, the Fund
believes that the exclusion of Stockholders residing in such jurisdiction is
permitted under Rule 13e-4(f)(9) promulgated under the Exchange Act.
16. Contacting the Depositary and the Information Agent. The Letter of
Transmittal, certificates for the Shares and any other required documents
should be sent by each Stockholder of the Fund or his or her broker-dealer,
commercial bank, trust company or other nominee to the Depositary as set forth
below.
<TABLE>
<S> <C> <C>
PFPC INC.
Depositary Addresses:
By First Class Mail: By Registered, Certified or Express By Hand:
Mail or Overnight Courier:
PFPC Inc. PFPC Inc. Securities Transfer & Reporting
c/o EquiServe Trust Company, N.A. c/o Equiserve Trust Company, N.A. Services, Inc.
Attn: Corporate Actions Attn: Corporate Actions c/o Equiserve Trust Company, N.A.
P.O. Box 43025 40 Campanelli Drive 100 William Street
Providence, R.I. 02940-3025 Braintree, MA 02184 New York, NY 10038
</TABLE>
16
<PAGE>
Any questions or requests for assistance or additional copies of the Offer,
the Letter of Transmittal, the Notice of Guaranteed Delivery, and other
documents may be directed to the Information Agent at its telephone number and
location listed below. Stockholders may also contact their broker, dealer,
commercial bank or trust company or other nominee for assistance concerning
the Offer.
The Information Agent for the Offer is:
GEORGESON SHAREHOLDER COMMUNICATIONS INC.
17 State Street
New York, New York 10004
Toll Free: 888-682-7298
or
Call Collect: 212-440-9800
THE INDIA GROWTH FUND INC.
January 16, 2001
