Securities and Exchange Commission
Washington, D.C. 20549
-------------------------------
SCHEDULE 13D
Under the Securities Exchange Act of 1934
(Amendment No. 6)
The Austria Fund, Inc.
- - ------------------------------------------------------------------------------
(Name of Issuer)
Common Stock
- - ------------------------------------------------------------------------------
(Title of Class of Securities)
052587102
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(CUSIP Number)
Ralph W. Bradshaw
c/o Deep Discount Advisors, Inc.
One West Pack Square, Suite 777
Asheville, NC 28801
(828) 255-4833
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(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
October 11, 1999
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(Date of Event which Requires
Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition which is the subject of this Schedule 13D, and is filing this
schedule because of Rule 13d-1(b)(3) or (4), check the following box. [ ]
CUSIP No.: 052587102 13D Page 2
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==========================================================================
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. ID NO. OF ABOVE PERSON
Deep Discount Advisors, Inc.
===========================================================================
2 CHECK THE APPROPRIATE BOX IF A MEMBER (a) [ ]
OF A GROUP (b) [ ]
===========================================================================
3 SEC USE ONLY
===========================================================================
4 SOURCE OF FUNDS OO
===========================================================================
5 CHECK BOX IF DISCLOSURE OF LEGAL [ ]
PROCEEDINGS IS REQUIRED PURSUANT TO
ITEM 2(d) OR 2(e)
===========================================================================
6 CITIZENSHIP OR PLACE OF ORGANIZATION
One West Pack Square, Suite 777 Asheville, NC 28801
===========================================================================
NUMBER OF | | SOLE VOTING POWER
SHARES | 7 | 3454
============================================================================
BENEFICIALLY | | SHARED VOTING POWER 0
OWNED | 8 |
============================================================================
BY EACH | | SOLE DISPOSITIVE POWER 3454
REPORTING | 9 |
============================================================================
PERSON | | SHARED DISPOSITIVE POWER 0
WITH | 10 |
============================================================================
11 AGGREGATE AMOUNT BENEFICIALLY OWNED
BY EACH REPORTING PERSON 3454
=======================================================================
12 CHECK IF THE AGGREGATE AMOUNT IN ROW [ ]
(11) EXCLUDES CERTAIN SHARES
=======================================================================
13 PERCENT OF CLASS REPRESENTED BY
AMOUNT IN ROW (11) 0.0%
=======================================================================
14 TYPE OF REPORTING PERSON IA
======================================================================
<PAGE>
CUSIP No.: 052587102 13D Page 3
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===============================================================================
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. ID NO. OF ABOVE PERSON
Ron Olin Investment Management Company
===============================================================================
2 CHECK THE APPROPRIATE BOX IF A MEMBER (a) [ ]
OF A GROUP (b) [ ]
========================================================================
3 SEC USE ONLY
======================================================================
4 SOURCE OF FUNDS OO
======================================================================
5 CHECK BOX IF DISCLOSURE OF LEGAL [ ]
PROCEEDINGS IS REQUIRED PURSUANT TO
ITEM 2(d) OR 2(e)
======================================================================
6 CITIZENSHIP OR PLACE OF ORGANIZATION
One West Pack Square, Suite 777 Asheville, NC 28801
=====================================================================
NUMBER OF | | SOLE VOTING POWER
SHARES | 7 | 8053
=====================================================================
BENEFICIALLY | | SHARED VOTING POWER 0
OWNED | 8 |
====================================================================
BY EACH | | SOLE DISPOSITIVE POWER 8053
REPORTING | 9 |
=====================================================================
PERSON | | SHARED DISPOSITIVE POWER 0
WITH | 10 |
======================================================================
11 AGGREGATE AMOUNT BENEFICIALLY OWNED
BY EACH REPORTING PERSON 8053
=====================================================================
12 CHECK IF THE AGGREGATE AMOUNT IN ROW [ ]
(11) EXCLUDES CERTAIN SHARES
=========================================================================
13 PERCENT OF CLASS REPRESENTED BY
AMOUNT IN ROW (11) 0.1%
=======================================================================
14 TYPE OF REPORTING PERSON IA
=========================================================================
<PAGE>
This Amendment No. 6 amends and updates information in Item 4 and Item 5 and
adds Exhibit E, F, G, and H.
ITEM 4. PURPOSE OF TRANSACTION
This filing is being made for the purpose of providing full disclosure relative
to possible contemplated transactions by the reporting persons in the issuer's
shares.
Ronald Olin, Ralph Bradshaw, Gary Bentz, and William Clark are associated with
the reporting persons and are also current sitting Directors of the issuer,
which is a regulated investment company known as The Austria Fund, Inc.
After Olin, Bradshaw, Bentz, and Clark were elected as Directors in the January
13, 1999 annual meeting of the issuer, the remaining Board majority who did not
stand for election (1) expanded the Board, (2) appointed three defeated
incumbent candidates back to the Board, (3) elected the Chairman of the Fund's
adviser (whose reelection as Director had been rejected by shareholders) as
chairman of the issuer, and (4) passed an extensive set of by-law changes
restricting the rights of shareholders in annual meetings.
Olin et. al. then filed a complaint with the Securities and Exchange Commission
(attached as Exhibit E).
In the next Board meeting, the adviser recommended, and the incumbent Board
majority approved, further by-law changes placing qualifications on any future
Director nominees that (1) would prohibit Olin et. al. from being reelected when
their terms expire and (2) would have the effect of making most shareholders of
the issuer and most sitting Directors of Regulated Investment Companies
ineligible to serve as Directors of the issuer.
Subsequently Olin et. al. requested that the adviser and other Directors provide
them a list of eligible Director candidates committed to delivering Net Asset
Value to shareholders so that they could be presented as an alternative to
shareholders in the upcoming annual meeting (attached as Exhibit F).
The request was rejected in a letter from the Adviser (attached as Exhibit G).
Correspondingly, the reporting persons have sent advance notice to the issuer
of their intent to (1) elect alternate candidates as Directors in the issuer's
upcoming annual meeting, (2) allow shareholders to vote on open-ending the
Austria Fund, and (3) pass by-law changes requiring shareholder approval before
by-law changes unilaterally made by the Board that reduce shareholder
prerogatives in shareholder meetings could take effect. As such, this advance
notice is challenging the validity of the various entrenchment actions taken by
the current Board majority. (A copy of the advance notice letter is attached as
Exhibit H.)
ITEM 5. INTEREST IN SECURITIES OF THE ISSUER
(a) The Fund's quarterly report, dated July 28,1999,
states that, as of the close of business on May 31, 1999, there were
7,947,357 shares of Common Stock outstanding. The percentage set forth
in this Item 5(a) was derived using such number.
The Reporting Persons are the beneficial owners of 11,507
shares of Common Stock, which constitute approximately .1% of the outstanding
shares of Common Stock.
(b) Power to vote and to dispose of the securities resides
with the Advisors.
(c) In the last sixty days, no shares were traded.
Date Number of Shares Price Per Share
- - ------- -------------------------- ---------------
SIGNATURE
After reasonable inquiry and to the best of my knowledge and
belief, I certify that the information set forth in this statement is true,
complete and correct.
Date: October 12, 1999 Deep Discount Advisors, Inc.
By: /s/ Ralph W. Bradshaw
----------------------------
Name: Ralph W. Bradshaw
Title: Secretary
Exhibit E
DEEP DISCOUNT ADVISORS, INC.
Closed-End Fund Investment Management
One West Pack Square, Suite 777, Asheville, NC 28801
(704) 274-1863 Fax: (704) 255-4834 E-mail: [email protected]
March 30, 1999
Paul F. Roye, Chairman Ph: 202-942-0720 Fax: 202-942-9659
Division of Investment Management
Securities and Exchange Commission
Mail Stop 5-6
450 Fifth Street, N. W.
Washington, DC 20549
Actions by Alliance Capital Management and Directors of The Austria Fund which
we believe may constitute Violations of Section 36A of the Investment Company
Act of 1940
Dear Mr. Roye:
We are writing the Securities Exchange Commission (SEC, the "Commission") in our
capacity as recently elected Directors of The Austria Fund (the "Fund") and as
shareholders of the Fund. We believe that a series of actions recently taken by
Alliance Capital Management ("Alliance"), the Fund's adviser, and the other
Directors of the Fund are discriminatory and impede our ability to exercise our
fiduciary responsibilities with regard to the shareholders who elected us.
Furthermore, we believe the actions taken by Alliance and the other Directors
may be a violation of their fiduciary responsibilities to the Fund's
shareholders under Section 36A of the Investment Company Act of 1940. We will
endeavor to describe in this letter the facts and circumstances surrounding our
belief, and will leave it to the Commission to determine whether or not further
investigation is appropriate and whether or not action should be taken by the
SEC.
THE SHAREHOLDER ELECTION RESULTS
The 1998 annual meeting of the shareholders of The Austria Fund was held on
January 13, 1999. We (the Soliciting Shareholder) ran an opposing proxy to that
of the Fund's Board of Directors in which we opposed the 4 nominees for director
presented by the Fund and presented a series of additional proposals for a vote
by the shareholders. The Fund employs a staggered board structure as an anti-
takeover device and the 7 other directors were not standing for election. The
official results on pertinent issues were as follows:
Votes for Director:
2,542,295 Mitterbauer - Defeated
2,538,207 Schaumayer - Defeated
2,539,934 Wolfsberger - Defeated
2,540,985 Williams, Chairman of Alliance Capital - Defeated
4,294,706 Olin - Elected
4,264,102 Bradshaw - Elected
4,294,148 Bentz - Elected
4,263,544 Clark - Elected
Proposal to terminate Alliance Capital Management as Advisor
2,886,763 For - Insufficient to pass as a 1940 Act majority vote
2,724,996 Against
Proposal to convert the Fund to an open-end investment company
4,891,919 For - Insufficient to pass Super-majority of 2/3 of all shares
1,493,883 Against
Precatory Proposal to Eliminate Staggered Board Structure
4,300,328 For - Passed
2,640,013 Against
Precatory Proposal to Reimburse Soliciting Shareholder for proxy expenses
4,307,876 For - Passed
2,878,416 Against
ATTEMPTS TO INFLUENCE THE ELECTION RESULTS
On July 4, 1998 we filed a 13D and sent the Fund a letter suggesting that, due
to the large and persistent discounts between the Fund's market price and its
asset value, the Fund engage in significant share buy-backs or offer full net
asset value to those shareholders who wished to exit the Fund. We requested a
meeting with the Board and also included a proposal to allow the shareholders to
vote on whether or not to terminate the Alliance management contract. We also
indicated we might initiate a proxy contest. We were only permitted to meet
with Mr. Williams, the chairman of Alliance and the Fund, and Mr. Bergan, an
Alliance employee who is Secretary of the Fund. They represented that they
could speak for the entire Board of Directors.
On October 7, 1998 we asked to be included as nominees to the Board in the 1998
annual shareholder meeting.
On October 15, 1998 the Fund announced a buy-back program.
On October 23, 1998 the Fund rejected our request to be Board Nominees.
We initiated an opposing proxy campaign. During the campaign the Fund
repurchased about one third of all shares outstanding at relatively small
discounts which were much less than historical levels reached only a few months
before. We believe a substantial number of shareholders sold into the Fund's
buyback that would have supported our proxy and our platform to deliver full Net
Asset Value (NAV) to the Fund's shareholders. The buyback abruptly stopped on
January 13, 1999, the day of the annual meeting. In spite of the unprecedented
repurchase of about one third of all the shares outstanding at prices less than
NAV, our platform was overwhelmingly supported by the vote of the shareholders,
as evidenced by the results given above. As a matter of conjecture, if the
number of shares repurchased after the record date for the annual meeting were
added to the shares voted in favor of the open-ending and the termination of
Alliance, the Board would have been forced to open-end the Fund and Alliance
would no longer be the Fund's advisor.
CIRCUMVENTING THE RESULTS OF THE SHAREHOLDER ELECTION
The first Board Meeting after the annual meeting of shareholders was held on
March 19, 1999. Alliance prepared the agenda for the meeting and we were not
consulted prior to its formulation. The only board members physically present
at the meeting, held at Alliance headquarters, were the four of us and Mr.
Carifa, president of Alliance. All of the other directors and former directors
who were considered to be in attendance, including Mr. Williams and his wife who
is a board member, were present by telephone conference.
The first order of business was to expand the Board from 11 to 14 and appoint
the defeated Board candidates, Williams, Mitterbauer, and Wolfsberger as board
members. The vote was 6 in favor and the 4 of us opposed. Dave Williams,
Chairman of Alliance Capital, was reappointed by a margin of 2 Board votes.
Three of the six votes he received were from interested directors by virtue of
their affiliation with Alliance and its sub-advisor. The three interested
Directors were Reba Williams, his wife, John Carifa, his employee, and William
H.M. de Gelsey, affiliated with Alliance's sub-advisor to the Fund. Mr.
Williams was subsequently elected Chairman of the Board of the Fund by a vote of
9 to 4, including the votes of the three newly appointed Board members. Mr.
Wolfsberger, who had been defeated for reelection by the shareholders in
January, was made chairman of both the nominating committee and the audit
committee.
The precatory proposal passed by the shareholders in the annual meeting to
eliminate staggered Board terms for directors was rejected by a vote of 9 to 4
without discussion.
The precatory proposal passed by the shareholders in the annual meeting to
reimburse the soliciting shareholder an estimated $14,000 in proxy expenses was
denied by a similar vote. The Fund admitted to having spent approximately
$270,000 of shareholder money in its failed attempt to elect the directors which
it had now reappointed to the Board. After pointing out that exemptive relief
from the Commission would be required to authorize payment to the soliciting
shareholder, the secretary of the Fund affirmed that the Fund had no intention
of making such a request.
We also submitted the following proposal at the Board meeting:
Resolved: Because the shareholders voted in the 1998 annual meeting by the
overwhelming margin of 4,891,919 to 1,493,883 that the Directors of the Fund
should take steps to convert the Fund to an open-end investment company, it
would be appropriate for the Directors to take whatever steps necessary to at
least provide the option to all shareholders of receiving full Net Asset Value
(NAV) for their shares as soon as possible.
After very little discussion, Mr. Williams announced that Alliance was against
this resolution and it was voted down by the same margin as the other actions
taken in the meeting. A request by the four of us that this and other Board
actions be included in the Fund's press release was denied by Mr. Williams and
the press release prepared by Alliance prior to the Board meeting was instead
released over our objections. At the end of the Board meeting, Mr. Bergan, the
Secretary of the Fund indicated that all material matters covered in the meeting
were included in the previously prepared press release. The Funds regular
counsel, its Maryland counsel, and the independent counsel to the Directors
concurred.
DISCRIMINATION AND FINANCIAL HARDSHIP
Many other significant actions were taken at the meeting which we believe were
specifically designed to discriminate against us and to create a financial
hardship on us as new directors. These actions also have the effect of impeding
our ability to discharge our fiduciary responsibilities to the shareholders.
The customary retainer fee paid to directors not affiliated with Alliance was
reduced from $8,000 to $5,000 per year. While this applied to all directors, it
had the specific effect of reducing the collective compensation for the newly
elected directors by $12,000 while increasing the payment to the directors
defeated in the shareholder election by $10,000. After denying our request for
$14,000 in proxy reimbursement, and spending $270,000 of shareholder money in a
losing attempt to reelect the incumbent directors, Alliance used as
justification the fact that it would save a few thousand dollars a year in
payments to the Directors. We believe the real purpose was to punish us
financially for running a successful campaign, and winning the support of the
shareholders.
Furthermore, the Fund adopted a policy to NOT reimburse Directors for expenses
related to attending Directors meetings unless they occurred in New York City.
It was confirmed to us that reimbursement would be provided for the costs of an
Austrian Director to fly to New York and back to Austria to attend a meeting in
person. However, we would be responsible for our own expenses to attend any
meeting not held in New York City such as the annual meeting of the Board
scheduled for Vienna this June 8th. Since most Directors are located in
Austria, such a policy is discriminatory and creates a severe financial hardship
on us in our attempts to discharge our fiduciary responsibilities. We suspect
that creating financial hardship for us is the purpose of this change as well as
to keep us physically separate from the Austrian Independent directors so as not
to contaminate them. It is very difficult to argue the case of what is best for
all shareholders outside the physical presence of the other directors.
In addition to general counsel for the Fund, and Maryland counsel to the Fund,
the Fund has customarily provided "independent" counsel to the directors not
affiliated with Alliance. The Independent counsel was consulted by Alliance on
the agenda to be presented at the Board meeting before it was distributed, and
he did not communicate with us any of the obviously discriminatory actions
planed for the meeting. When asked whether he believed any of the contemplated
actions are in any way discriminatory or impede our ability to exercise our full
fiduciary responsibilities, the independent counsel for the Directors declined
to directly answer the question. Correspondingly, we requested that the Fund
provide us with separate, independent counsel and presented a resolution to that
effect. The Board voted the resolution down by a similar vote.
Alliance also claimed that because of our alleged "explicit dedication to the
advocacy of a specific agenda which appears not to involve the business of
either committee", none of us would be appointed to either the audit committee
or the nominating committee, even though it has been customary for all Directors
not affiliated with Alliance to be members of both committees. The same
majority of the Board concurred.
BY-LAW CHANGES DESIGNED TO ENTRENCH ALLIANCE AND THE EXISTING BOARD MAJORITY
Alliance also proposed that the Directors approve an expansive set of by-law
changes which we believe are designed in large part to make it even more
difficult for shareholders to influence the direction and actions of their own
Fund and Board of Directors. After rejecting all the precatory proposals passed
by the shareholders in the annual meeting, the Directors, by a similar vote,
with us in opposition, passed by-law changes, with virtually no discussion,
which included the following:
Increase from 25% to 50% the number of outstanding shares required to call a
special meeting of shareholders;
Establish Board-controlled procedures for important aspects of calling a
stockholder-requested meeting;
Adopt Restrictive Advance Notice provisions for providing alternate director
nominations and shareholder proposals in shareholder meetings;
Establish enhanced Chairman powers in presiding at stockholder meetings;
Clarify the Board's exclusive control over making, altering, and repealing
Bylaws;
Eliminate the right of shareholders to remove Directors "without cause";
Allow the Board to delegate to the chairman power to appoint various officers.
SUBSEQUENT OPEN MARKET TRANSACTION
Ron Olin Investment Management Co. and Deep Discount Advisors, Inc, with which
all of us are affiliated, were the soliciting shareholders in the proxy contest.
For several weeks, an unidentified party had been attempting to buy large blocks
of Austria Fund shares through brokers with whom we deal regularly. On March
26, 1999 we sold almost all of the shares beneficially held by the soliciting
shareholder in an open market transaction at what we estimated at the time was
an historically low discount to Net Asset Value of about -3%. Nevertheless, all
of us individually remain stockholders of the Fund as well as Directors, and we
intend to continue to pursue, as best we are able, the expressed wishes of all
the Austria Fund shareholders in the last annual meeting.
CONCLUSION
Chairman Levitt of the Commission has recently been advocating reforms relative
to the authority and ability of independent directors to represent the best
interests of shareholders. Most of the Directors defeated by the shareholders
in the last annual meeting of the Austria Fund as well as those not standing for
election and following the Alliance "party line" are nominally "independent."
It makes little difference. The problem is more fundamental. It has to do with
the proper exercise of fiduciary responsibility. Our sole goal is to implement
the obvious wishes of most of the shareholders as expressed by their vote at the
annual meeting. We are being obstructed and prevented from doing that by the
actions of Alliance and the incumbent directors.
We are hopeful that the Commission will look seriously at the actions taken by
Alliance Capital and the Fund's Directors. We would be happy to respond to any
questions the Commission might have related to these matters.
Very truly yours,
Ronald G. Olin Ralph Bradshaw Gary Bentz William Clark
Exhibit F
DEEP DISCOUNT ADVISORS, INC.
One West Pack Square, Suite 777, Asheville, NC 28801
828-274-1863 Fax: 828-255-4834 E-mail: [email protected]
Edmund P. Bergan, Jr., Secretary Ph: 212-969-2108 Fax: 212-969-2290
The Board of Directors, The Austria Fund, Inc.
Alliance Capital Management L.P.
1345 Avenue of the Americas
New York, NY 10105
(via both Fax and Federal Express) September 22, 1999
Dear Mr. Bergan:
As you and the Board are aware, the directors elected at the last annual meeting
of the Austria Fund do not believe that the very recent by-law changes imposing
restrictive qualifications on Fund Director nominees in future elections are
appropriate. We further believe they may be illegal. Never-the-less, we would
like to request the assistance of Alliance, the Fund's advisor, and the other
Board members to bring choices before the shareholders of the Fund in the next
annual meeting, scheduled for December 15, 1999.
In the last shareholder meeting, the vote was 4,891,919 in favor and 1,493,883
against the proposal to convert the Fund to an open-end investment company. In
light of this clear preference of shareholders to have an option to receive Net
Asset Value (NAV) for their shares, we have attempted to present various
proposals to the rest of the Board to satisfy this preference. All such actions
have been opposed by the other Directors, including the Directors defeated by
the shareholders in the last election who were re-appointed to the Board over
our opposition.
There are seven Directors up for election in the 1999 annual meeting, and we
would like to present an opposing proxy to shareholders with various proposals
and seven alternate Director candidates committed to provide shareholders the
option to receive NAV for their shares in the near future. We know many
potential candidates who would be willing to make this commitment and who would
be qualified to serve on the Boards of every other closed-end fund not managed
by Alliance. However, none of them are Austrian citizens, none are high
officials of Austrian companies or the Austrian Government, and none of them are
affiliated with Alliance (the Fund's adviser). Therefore, we would like to
request that Alliance and members of the current Board provide us with a list of
suitable, qualified candidates that would be committed to providing the
shareholders of The Austria Fund, Inc. the option to receive NAV for their Fund
shares. As you are well aware, many other closed-end funds and sitting
Directors have found ways to accommodate their shareholders in this way.
We thank you in advance for your kind consideration of our request and would
appreciate a response within five (5) days, as the window for providing
appropriate advance notice of our candidates to the Fund does not provide much
remaining time.
Very truly yours,
Ronald G. Olin Ralph Bradshaw Gary Bentz William Clark
Exhibit G
Alliance Fund Distributors, Inc.
1345 Avenue of the Americas
New York, NY 10105
Tel: (212) 969-2108
ALLIANCE CAPITAL
Edmund P. Bergan, Jr.
Senior Vice President
and General Counsel
September 27, 1999
Via Facsimile Transmission
And Federal Express
Mr. Ronald G. Olin
Mr. Ralph Bradshaw
Mr. Gary A. Bentz
Mr. William A. Clark
Deep Discount Advisors, Inc.
One West Pack Square, Suite 777
Asheville, North Carolina 28801
Re: The Austria Fund, Inc.
Gentlemen:
I refer to your letter of September 22, 1999 to me for both the Board of
Directors of The Austria Fund, Inc. (the "Fund") and Alliance Capital Management
L.P. ("Alliance"). I am forwarding your letter to the Fund's Board of
Directors.
We believe that it would be inappropriate for either Alliance or the Fund's
Board of Directors to undertake to identify candidates for election to the Board
fitting the specifications mentioned in your letter, which include a commitment
to measures that both Alliance and a majority of the Board believe are
inconsistent with the best interests of the Fund and its stockholders. We thus
intend to recommend to the Fund's Board of Directors that it determine not to
comply with your request.
Very truly yours,
(signed)
(Edmund P. Bergan, Jr.)
cc: Members of the Board of Directors
of The Austria Fund, Inc.
Seward & Kissel LLP
Sullivan & Cromwell
Ballard Spahr Andrews & Ingersoll, LLP
Exhibit H
DEEP DISCOUNT ADVISORS, INC.
Closed-End Fund Investment Management
One West Pack Square, Suite 777, Asheville, NC 28801
(704) 274-1863 Fax: (704) 255-4834 E-mail: [email protected]
October 11, 1999
Mr. Edmund P. Bergan, Jr., Secretary Ph: 212-969-2108 Fax: 212-969-2290
The Board of Directors, The Austria Fund, Inc.
Alliance Capital Management L.P.
1345 Avenue of the Americas
New York, N.Y. 10105
Re: Formal Advanced Notice of Director Nominees
and Other Proposals
To the Board of Directors of The Austria Fund:
This letter will serve as formal notice that Deep Discount Advisors, Inc. and
Ron Olin Investment Management Company, ("Soliciting Shareholder"), intend to
solicit proxies for the next annual meeting scheduled for December 15, 1999.
The Soliciting Shareholder is the beneficial holder of 11,507 shares of The
Austria Fund, Inc., (the "Fund"), as of October 11, 1999. Pursuant to the by-
laws of the Fund, this notice is given at least 90 days and not longer than 120
days prior to the anniversary of the previous year's annual meeting, (January
13, 1999). We intend to nominate four (4) individuals to serve as Board members
of the Fund. These individuals are Glenn Wilcox, Sr., Andrew Strauss, Thomas
Lenagh, and Gerald Hellerman. All of our nominees have agreed to serve if
elected, and in the currently unanticipated event that one or more of them are
unable to serve, then they would be replaced with other nominees of our
choosing. The names, addresses, and brief biographies of our nominees are
included on the attached exhibit.
With regard to the advanced notice of our Director nominees, if you need any
additional information in order to comply fully with the Fund's notification
requirements, please advise us accordingly within five (5) business days.
The Soliciting Shareholder also intends to solicit enough proxies to pass the
following seven (7) proposals, which we intend to introduce at the meeting for
consideration by the shareholders of the Fund.
1. RESOLVED, that the by-laws of the Corporation be amended to require that any
by-law changes unilaterally made by the Board of Directors that limit the
prerogatives of the shareholders to affect the operation of the Corporation in
shareholder meetings shall be presented for approval or rejection by a vote of
the shareholders in the next succeeding shareholder meeting. Approval shall
require a majority of the shares outstanding to vote in favor of any such by-law
change.
2. RESOLVED, that the by-laws of the Corporation be amended to require that if
two-thirds of the votes cast are in favor of open-ending The Austria Fund in any
shareholder meeting, but such proposal does not receive the required vote for
approval, the Corporation will present a similar open-ending proposal for
consideration of the shareholders in the next succeeding annual meeting.
3. RESOLVED, that the by-laws of the Corporation be amended to require that any
Director candidate who is defeated for election in a meeting of the shareholders
shall not be permitted to subsequently assume a position as Director on the
Board until he or she is elected by a vote of the shareholders in a subsequent
shareholder meeting.
4. RESOLVED, that the by-laws of the Corporation be amended to require that no
qualifications for Director shall be established by the Corporation that have
the effect of excluding as a nominee for Director anyone who would normally be
qualified to serve as a Director of a U.S. Regulated Investment Company unless
such qualifications are first approved by a vote of a majority of the
outstanding shares of the Corporation in a shareholder meeting.
5. RESOLVED, that the by-laws of the Corporation be amended to require that
duly elected Directors of the Corporation shall be reimbursed for their
reasonable out-of-pocket expenses incurred to attend in person any duly called
meeting of the Board of Directors of the Corporation.
6. RESOLVED, that the Fund's investment advisory agreement with Alliance
Capital Management, L.P. shall be terminated effective 60 days following the
date of the annual meeting, and that the shareholders recommend that the Board
solicit competitive proposals for a new investment advisor.
7. RESOLVED, that the Fund's Articles of Incorporation shall be amended to
convert the Fund from a closed-end investment company to an open-end investment
company and to change the subclassification of the Fund from a closed-end
investment company to an open-end investment company.
Sincerely,
Ronald G. Olin
Chairman, Deep Discount Advisors, Inc.
General Partner, Ron Olin Investment Management Company
attch
cy: Paul F. Roye, Chairman
Division of Investment Management
Securities and Exchange Commission
Mail Stop 5-6
450 Fifth Street, N.W.
Washington, D.C. 20549
Name and Address Age Principal Occupation Past Five Years
Glenn W. Wilcox, Sr.
418 Vanderbilt Road
Asheville, NC 28803
67 Chairman of the Board and Chief Executive
Officer of Wilcox Travel Agency; Director of
Champion Industries, Inc.; Chairman of the Board
of Blue Ridge Printing Co., Inc.; Chairman of
the Board of Tower Associates, Inc.; Director of
Asheville Chamber of Commerce; Vice Chairman of
the Board of First Union National Bank; Board of
Trustees of Appalachian State University; Board
of Trustees and Board of Directors of Mars Hill
College.
Shares of The Austria
Fund, Inc. (10-8-99) - 0 -
Andrew Strauss
77 Central Ave,
Suite F
Asheville, NC 28801
45 Attorney and senior member of Strauss &
Associates, PA., attorneys, Asheville, N.C.;
Previous President of White Knight Healthcare,
Inc., and LMV Leasing, Inc., a wholly owned
subsidiary of Xerox Credit Corporation.
Shares of The Austria
Fund, Inc. (10-8-99) - 0 -
Gerald Hellerman
10965 Eight Bells Lane
Columbia, MD 21044
61 Managing Director of Hellerman Associates, a
financial consulting firm; Trustee of Third
Avenue Value Trust; Director of Clemente
Strategic Value Fund, Inc., a closed-end
investment company.
Shares of The Austria
Fund, Inc. (10-8-99) - 0 -
Thomas H. Lenagh
Greenwich Office Park
Greenwich, CT 06831
77 Independent Financial Adviser; Director of
Gintel Funds, Adams Express, ASD Group, ICN
Pharmaceuticals, Inrad Corp., and V-Band Corp;
Director of Clemente Strategic Value Fund, Inc.,
a closed-end investment company.
Shares of The Austria
Fund, Inc. (10-8-99) - 0 -
