<PAGE>
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE SECURITIES EXCHANGE
ACT OF 1934
(AMENDMENT NO. 1)
Filed by the Registrant [ ]
Filed by a Party other than the Registrant |X|
Check the appropriate box:
|X| Preliminary Proxy Statement [ ] Confidential, For Use of
the Commission Only (as
permitted by
Rule 14a-6(e)(2))
[ ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
THE GROWTH FUND OF SPAIN, INC.
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(Name of Registrant as Specified in its Charter)
BANKGESELLSCHAFT BERLIN AG
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(Name of Person(s) Filing Proxy Statement, if Other Than the Registrant)
Payment of Filing Fee (Check the appropriate box):
|X| No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
______________________________________________________________
(2) Aggregate number of securities to which transaction applies:
______________________________________________________________
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on
which the filing fee is calculated and state how it was
determined): _________________________________________________
(4) Proposed maximum aggregate value of transaction: _____________
(5) Total fee paid: ______________________________________________
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number, or
the form or schedule and the date of its filing.
(1) Amount previously paid: _______________________________________
(2) Form, Schedule or Registration Statement No.: _________________
(3) Filing Party: _________________________________________________
(4) Date Filed: ___________________________________________________
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PRELIMINARY COPY -- SUBJECT TO COMPLETION
Bankgesellschaft Berlin AG
Alexanderplatz 2
D-10178 Berlin
Germany
Dear Fellow Shareholder of The Growth Fund of Spain, Inc. (the "Fund"):
As the largest shareholder of the Fund (based on public filings with
the Securities and Exchange Commission), Bankgesellschaft Berlin AG (the
"Soliciting Shareholder") is deeply concerned about the persistent discount
from net asset value ("NAV") of the shares of the Fund. According to the
Closed-End Fund Digest (October 1997), the shares of the Fund traded at an
average discount of 19.55% from their NAV during the 52 weeks ended September
26, 1997. We seek your support in electing our two nominees to the Board of
Directors of the Fund at the Special Meeting of Shareholders of the Fund
scheduled for December 3, 1997. Our two nominees, Gregory L. Melville and
Moritz A. Sell, have indicated to us that, if elected to the Board of Directors
of the Fund, they will be committed to exploring methods of reducing or
eliminating the discount from NAV of the shares of the Fund. We believe that
our two nominees will be more committed to urging the full Board of Directors
of the Fund to take prompt action to reduce or eliminate the persistent
discount from NAV at which the shares of the Fund have traded than the two
directors nominated by the Fund (each of whom is affiliated with the Fund's
proposed new investment manager). The actions which our nominees might urge the
full Board to take include open-ending the Fund or converting the Fund to a
closed-end interval fund, among others. (Shareholders should be aware that,
even if our nominees are elected to the Board of Directors of the Fund, they
will constitute only two of the eight members of the Board and they may not be
able to persuade other members of the Board to take any actions that they
propose.) PLEASE SIGN, DATE AND RETURN THE ENCLOSED BLUE PROXY IN THE
POSTAGE-PREPAID ENVELOPE WHICH HAS BEEN PROVIDED. It is important that you not
return any proxy card sent to you by the Fund. If you have returned the WHITE
proxy card sent to you by the Fund, you have the right to revoke that proxy and
vote for our nominees by signing, dating and mailing a later dated BLUE proxy
card in the envelope provided. If you have any questions, please contact
Georgeson & Company Inc., who is assisting us in the solicitation, toll-free at
1-800-223-2064.
IMPORTANT
There are four proposals scheduled to be voted upon at the Special
Meeting (the election of two directors, the ratification of independent
auditors of the Fund for the current fiscal year, the approval or disapproval
of a new investment management agreement and the approval or disapproval of a
new sub-advisory agreement). All of the proposals scheduled to be voted upon at
the Special Meeting are included in our BLUE proxy card. If you wish to vote
for the Soliciting Shareholder's nominees, you may do so by completing and
returning a BLUE proxy card. The Soliciting Shareholder makes no recommendation
as to how to vote on the other proposals scheduled to be voted upon at the
Special Meeting, other than the election of directors. If a BLUE proxy card is
returned without a vote indicated thereon, the shares represented thereby will
be voted FOR the election of the Soliciting Shareholder's nominees and will
ABSTAIN with respect to the vote on the
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ratification of independent auditors, the approval of the new investment
management agreement and the approval of the new sub-advisory agreement.
Sincerely yours,
Bankgesellschaft Berlin AG
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PRELIMINARY COPY -- SUBJECT TO COMPLETION
PROXY STATEMENT IN OPPOSITION TO
THE SOLICITATION BY THE BOARD OF DIRECTORS OF
THE GROWTH FUND OF SPAIN, INC.
SPECIAL MEETING OF SHAREHOLDERS
To be held on December 3, 1997
To Our Fellow Shareholders:
This Proxy Statement and the enclosed BLUE proxy card are being
furnished to holders of record on September 22, 1997 (the "Record Date") of
shares of common stock, par value $.01 per share (the "Common Stock"), of The
Growth Fund of Spain, Inc., a Maryland corporation (the "Fund"), by
Bankgesellschaft Berlin AG, a German banking organization (the "Soliciting
Shareholder"), in connection with the solicitation of proxies by the Soliciting
Shareholder for use at the Special Meeting of shareholders of the Fund (the
"Special Meeting") to be held on Wednesday, December 3, 1997 at 2:30 p.m.,
Chicago time, and any and all adjournments or postponements thereof. The
Special Meeting will be held in the Presentation Room on the 32nd Floor at the
offices of the Fund, located at 222 South Riverside Plaza, Chicago, Illinois.
The Special Meeting is one of a number of joint special meetings of Kemper
Closed-End Funds scheduled for the same time and place. This Proxy Statement
and the accompanying BLUE proxy card are first being sent to shareholders of
the Fund on or about __________, 1997.
There are four matters scheduled to be voted upon at the Special
Meeting: (i) the election of two directors of the Fund, (ii) the ratification
of independent auditors of the Fund, (iii) the approval or disapproval of a new
investment management agreement and (iv) the approval or disapproval of a new
sub-advisory agreement.
The Soliciting Shareholder is soliciting your proxy in support of the
election of its two nominees to the Board of Directors of the Fund (the
"Board"). The Soliciting Shareholder believes that its nominees will be more
committed to urging the full Board of Directors of the fund to take prompt
action to reduce or eliminate the persistent discount from net asset value
("NAV") at which the shares of Common Stock have traded than the individuals
nominated to the Board by the other members of the Board.
All of the proposals scheduled to be voted upon at the Special Meeting
are included in the Soliciting Shareholder's BLUE proxy card. If you wish to
vote for the Soliciting Shareholder's nominees, you may do so by completing and
returning a BLUE proxy card. The Soliciting Shareholder makes no recommendation
as to how to vote on the other proposals scheduled to be voted upon at the
Special Meeting, other than the election of directors. If a BLUE proxy card is
returned without a vote indicated thereon, the shares represented thereby will
be voted FOR the election of the Soliciting Shareholder's nominees and will
ABSTAIN with respect to the vote on the ratification of independent auditors,
the approval of the new investment management agreement and the approval of the
new sub-advisory agreement.
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Discretionary authority is provided in the proxy sought hereby as to
other business as may properly come before the meeting of which the Soliciting
Shareholder is not aware as of the date of this Proxy Statement and matters
incident to the conduct of the Special Meeting, which discretionary authority
will be exercised in accordance with Rule 14a-4 promulgated by the Securities
and Exchange Commission (the "Commission").
The Fund currently has a total of seven directors, divided into three
classes. (One directorship is vacant and will be filled at the Special Meeting,
so that the Board will then have a total of eight directors.) There are two
Class I directors, whose terms expire in 1998, three Class II directors, whose
terms expire in 1999, and three Class III directors, whose terms expire in
2000. One of the directors to be elected at the Special Meeting will be a Class
II director and one of the directors to be elected at the Special Meeting will
be a Class III director. The Soliciting Shareholder proposes Moritz A. Sell as
the Class II director (term expiring in 1999) to be elected at the Special
Meeting and Gregory L. Melville as the Class III director (term expiring in
2000) to be elected at the Special Meeting. BLUE proxy cards which are properly
signed, dated and returned will be voted in a manner consistent with this
proposal.
The vote for new directors and the vote on the new investment
management agreement and sub-advisory agreement are being made in connection
with a transaction pursuant to which a majority interest in Scudder, Stevens &
Clark, Inc. ("Scudder") will be acquired by Zurich Insurance Company
("Zurich"), the parent company of the Fund's current investment manager. Upon
consummation of the acquisition, the Fund's current investment manager will be
combined with or acquired by Scudder. The directors elected at the Special
Meeting will take office upon consummation of these transactions. If these
transactions are not consummated, the directors elected at the Special Meeting
(whether such directors are nominees of the Soliciting Shareholder or of the
Fund) will not take office.
VOTING, QUORUM
Only shareholders of record on the Record Date will be entitled to
vote at the Special Meeting. According to the proxy statement distributed by
the Board of Directors in connection with the Special Meeting (the "Fund Proxy
Statement"), there were 16,544,593 shares of Common Stock issued and
outstanding on September 22, 1997. Holders of record on the Record Date will be
entitled to cast one vote on each matter for each share of Common Stock held by
them. Shares of Common Stock do not have cumulative voting rights. Directors of
the Fund are elected by a plurality of the votes cast.
In tallying shareholder votes, abstentions and "broker non-votes"
(i.e., shares held by brokers or nominees as to which (a) instructions have not
been received from the beneficial owners or persons entitled to vote and (b)
the broker or nominee does not have discretionary voting power on a particular
matter) will be counted for purposes of determining whether a quorum is present
for purposes of convening the Special Meeting. Abstentions and broker non-votes
will have no effect in the election of directors; the two nominees receiving
the largest number of votes will be elected.
At least 50% of the shares of Common Stock must be present, in person
or by proxy, in order to constitute a quorum for the transaction of business.
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REVOCATION OF PROXIES
Any proxy given in connection with the Special Meeting (whether given
to the Fund or to the Soliciting Shareholder) may be revoked at any time prior
to the voting thereof at the Special Meeting by delivering a written revocation
of his or her proxy to the Secretary of the Fund or with the presiding officer
at the Special Meeting, by executing and delivering a later dated proxy to the
Soliciting Shareholder or the Fund or their solicitation agents, or by voting
in person at the Special Meeting. Attendance at the Special Meeting will not in
and of itself revoke a proxy.
There is no limit on the number of times that a shareholder may revoke
his or her proxy prior to the Special Meeting. Only the latest dated, properly
signed proxy card will be counted.
IF YOU HAVE ALREADY SENT A WHITE PROXY CARD TO THE BOARD OF DIRECTORS
OF THE FUND, YOU MAY REVOKE THAT PROXY AND VOTE FOR THE NOMINEES OF THE
SOLICITING SHAREHOLDER BY SIGNING, DATING AND MAILING THE ENCLOSED BLUE PROXY
CARD IN THE ENVELOPE PROVIDED.
THE BLUE PROXY CARD CONTAINS ALL OF THE PROPOSALS SCHEDULED TO BE
VOTED UPON AT THE SPECIAL MEETING. IF YOU WISH TO VOTE FOR THE SOLICITING
SHAREHOLDER'S NOMINEES, YOU MAY DO SO BY COMPLETING AND RETURNING A BLUE PROXY
CARD. THE SOLICITING SHAREHOLDER MAKES NO RECOMMENDATION AS TO HOW TO VOTE ON
THE PROPOSALS SCHEDULED TO BE VOTED UPON AT THE SPECIAL MEETING, OTHER THAN THE
ELECTION OF DIRECTORS. IF A BLUE PROXY CARD IS RETURNED WITHOUT A VOTE
INDICATED THEREON, IT WILL BE VOTED IN FAVOR OF THE SOLICITING SHAREHOLDER'S
NOMINEES AND WILL ABSTAIN WITH RESPECT TO THE VOTE ON THE RATIFICATION OF
INDEPENDENT AUDITORS, THE APPROVAL OF THE NEW INVESTMENT MANAGEMENT AGREEMENT
AND THE APPROVAL OF THE NEW SUB-ADVISORY AGREEMENT.
INFORMATION CONCERNING THE SOLICITING SHAREHOLDER
The Soliciting Shareholder is one of the largest banking organizations
in Germany, with over 343.8 billion German marks in assets as of June 30, 1997
and equity capital of over 8.1 billion German marks as of June 30, 1997
(equivalent to approximately $197.6 billion and $4.6 billion, respectively, at
prevailing exchange rates at June 30, 1997). The principal executive offices of
the Soliciting Shareholder are located at Alexanderplatz 2, D-10178 Berlin,
Germany. As of the date of this Proxy Statement, the Soliciting Shareholder
owned 1,697,200 shares of Common Stock, representing approximately 10.3% of the
issued and outstanding shares of Common Stock. The Soliciting Shareholder is
the largest shareholder of the Fund (based on public filings with the
Commission). The Soliciting Shareholder owns shares in a number of other
closed-end mutual funds, including three others in which it owns more than 5%
of the outstanding shares. The Soliciting Shareholder has not solicited proxies
in opposition to the solicitation of proxies by the management of any other
closed-end fund in which it has an equity interest, although it reserves the
right to do so in the future.
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On October 7, 1997, the Soliciting Shareholder sent the letter
attached hereto as Exhibit 1 to the Fund. In such letter, the Soliciting
Shareholder requested that the Audit and Governance Committee of the Fund
nominate the Soliciting Shareholder's nominees to the Board of Director of the
Fund. On October 14, 1997, Kemper Funds sent the letter attached hereto as
Exhibit 2 to the Soliciting Shareholder. In such letter, Kemper Funds stated
that the Soliciting Shareholder's nominees would be considered at the next
regularly scheduled meeting of the Audit and Governance Committee. In a
conversation with the Fund, the Soliciting Shareholder was informed that the
Soliciting Shareholder's proposal regarding its nominees was submitted too late
for the Audit and Governance Committee to consider for inclusion in the Fund
Proxy Statement relating to the Special Meeting.
Exhibit 3 attached hereto sets forth information concerning purchases
of shares of Common Stock of the Fund by the Soliciting Shareholder during the
last two years. During such period, the Soliciting Shareholder has not sold any
shares of the Fund.
REASONS FOR THE SOLICITATION
According to the Closed-End Fund Digest (October 1997), the shares of
the Fund traded at an average discount of 19.55% from their NAV during the 52
weeks ended September 26, 1997. The Soliciting Shareholder has determined to
undertake this proxy solicitation because it believes that its nominees will be
more committed to urging the full Board of Directors of the Fund to take prompt
action to reduce or eliminate the persistent discount from NAV at which the
shares of the Fund have traded than the two directors nominated by the Fund
(each of whom is affiliated with the Fund's proposed new investment manager).
The two nominees to the Board proposed by the Board are both
affiliated with Scudder, Stevens & Clark, Inc. ("Scudder"), a majority interest
in which will be acquired by Zurich Insurance Company ("Zurich"), the parent
company of the Fund's current investment manager. Upon completion of the
acquisition, the Fund's current investment manager will be combined with or
acquired by Scudder. The Soliciting Shareholder proposes to nominate to the
Board of the Fund two individuals who have no affiliation with the Fund's
investment manager and who have indicated that they will be committed to urging
the full Board of Directors of the Fund to take action to reduce or eliminate
the discount from NAV of the shares of the Fund. Such methods might include
committing the Fund to disseminating NAV on a daily basis, converting the Fund
to a closed-end interval fund, or open-ending the Fund, among others.
Even if the full Board of Directors of the Fund determines to
implement any of the proposals which the nominees of the Soliciting Shareholder
may urge the full Board to consider, there can be no assurance that any such
proposal will ultimately be implemented. Each of the proposals which the
nominees of the Soliciting Shareholder may urge the full Board to consider
entail costs and difficulties which may impede or delay their implementation.
For example, if the Board of Directors determined to propose that the Fund
become an open-end investment company, shareholders of the Fund holding at
least 75% of the outstanding shares would have to vote in favor of the proposal
in order for it to be adopted. There can be no assurance that the requisite
shareholder vote could be obtained. Moreover, the Fund might incur significant
costs in preparing a proxy statement relating to the open-ending proposal and
holding a shareholders' meeting to vote on the proposal. The conversion of the
Fund to an closed-end interval fund would also require shareholder approval, of
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which there could be no assurance, and the preparation of a proxy statement and
the holding of a shareholders' meeting, which might result in significant costs
to the Fund. In addition, the Fund would need to consider whether to engage an
underwriter to distribute its shares if it were open- ended or converted to a
closed-end interval fund, and there can be no assurance that it would be able
to engage an underwriter for such purposes. If the Fund were to convert to an
open-end fund or a closed-end interval fund, the Fund would need to increase
its cash position to by selling portfolio securities. Such a restructuring of
its portfolio could reduce the prices to be received for securities the Fund
sold, thus reducing the Fund's net asset value.
According to documents filed with the Commission, the Board of
Directors of the Fund has authorized the open-market repurchase and retirement
of three million shares of Common Stock. The effect of such repurchases may be
to reduce the discount to NAV at which the shares of Common Stock trade. The
proxy statement used in connection with the 1996 Annual Meeting of Shareholders
of the Fund contained proposals to open-end the Fund and to convert the Fund to
a closed-end interval fund. In such proxy statement the Board of Directors
discussed the benefits and costs of such proposals and recommended that
shareholders of the Fund not vote in favor of such proposals.
Mr. Melville has extensive experience in risk management and trading
in international equities. Mr. Sell has significant experience in international
securities as both a trader and an analyst. As the Fund invests primarily in
the securities of Spain, their professional experience would prove to be an
asset to the Fund.
Shareholders of the Fund should note that even if the Soliciting
Shareholder's nominees are elected to the Board of Directors of the Fund, they
will constitute only two of the eight members of the Board of Directors. For
these and other reasons, there can be no assurance that, even if the Soliciting
Shareholder's nominees are elected, that the discount from NAV at which the
shares of Common Stock trade will be reduced or eliminated. The Soliciting
Shareholder has not made any decision as to whether or not it will solicit
proxies in future election contests involving the Fund.
THE NOMINEES
BLUE proxy cards which are signed, dated and returned to the
Soliciting Shareholder or its agent, Georgeson & Company Inc. ("Georgeson"),
will be voted in favor of the election of Gregory L. Melville and Moritz A.
Sell. Messrs. Melville and Sell have furnished the Soliciting Shareholder with
the following information concerning their employment history and certain other
matters:
<TABLE>
<CAPTION>
Name Age Present Principal Occupation
- ---- --- ----------------------------
<S> <C> <C>
Gregory L. Melville 41 Assistant Director of Bankgesellschaft Berlin AG
Moritz A. Sell 30 Market Strategist at Bankgesellschaft Berlin AG
</TABLE>
Both Mr. Melville and Mr. Sell are United States citizens. Neither
Mr. Melville nor Mr. Sell owns, beneficially or of record, any shares of
Common Stock. The principal business address of Messrs. Melville and Sell
is c/o the Soliciting Shareholder, Alexanderplatz 2, D-10178 Berlin, Germany.
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Other than fees payable by the Fund to its directors, neither of the
Soliciting Shareholder's nominees has any arrangement or understanding with any
person with respect to any future employment by the Fund or its affiliates. The
Soliciting Shareholder has agreed to indemnify its nominees for liabilities
they may incur in connection with this proxy solicitation.
GREGORY L. MELVILLE. Mr. Melville has been an Assistant Director of
the Soliciting Shareholder since July 1995. From 1990 until June 1995, Mr.
Melville was a Vice President of Salomon Brothers Inc., an investment bank,
working at Salomon Brothers AG, a subsidiary in Germany. From 1989 through
1990, Mr. Melville was employed by Devon Systems, a software manufacturer for
securities firms, as a consultant to customers of Devon Systems. From 1983
through 1989, Mr. Melville was self-employed in the financial services
industry. Mr. Melville served as a finance officer in the United States Army
from 1978 through 1983. He received a Bachelor of Science degree from the
United States Military Academy at West Point in 1978.
MORITZ A. SELL. Mr. Sell has been a Market Strategist at the
Soliciting Shareholder since November 1996. From October 1995 until May 1996,
Mr. Sell was an analyst in a consulting capacity at Barclays de Zoete Wedd, an
investment bank. From 1990 through 1993, Mr. Sell was a Derivatives Trader at
the Canadian Imperial Bank of Commerce and, from 1993 through April 1994, Mr.
Sell was a Derivatives Trader at the Canadian Imperial Bank of Commerce and a
Vice President of CIBC Inc., a subsidiary of the Canadian Imperial Bank of
Commerce. Mr. Sell received a Bachelor of Arts degree in Economics from George
Washington University in 1989.
PRINCIPAL HOLDERS OF VOTING SECURITIES
The following table sets forth certain information as of the date of
this Proxy Statement regarding the beneficial ownership of shares of Common
Stock by each beneficial owner of more than 5% of the outstanding shares of
Common Stock, based upon information contained in filings with the Commission
(except that information with regard to the Soliciting Shareholder reflects the
number of shares of Common Stock beneficially owned by the Soliciting
Shareholder as of the date of this Proxy Statement and is more current than the
information contained in the Soliciting Shareholder's filings with the
Commission). Unless otherwise noted, each individual or entity named below has
sole voting and investment power with respect to the shares indicated:
<TABLE>
<CAPTION>
Name and Address No. of Shares Owned Percentage of Class
- ---------------- ------------------- -------------------
<S> <C> <C>
Bankgesellshaft Berlin AG 1,697,200 10.3%
Alexanderplatz 2
D-10178 Berlin
Germany
Stichting Azko Pensioenfonds (1) 965,000 5.8%
Jansbuitensingel 30
Postbox 1002
6801 ME Arnhem
Netherlands
</TABLE>
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(1) According to a Schedule 13D filed by Stichting Azko
Pensioenfonds ("Stichting") in March 1992, Stichting is the beneficial
owner of 965,000 shares of Common Stock. Stichting has not
subsequently publicly filed an amendment to its Schedule 13D. However,
the Fund Proxy Statement, which lists all holders of more than 5% of
the Fund's shares, does not include Stichting as such a holder.
According to the Fund Proxy Statement, officers and directors of the
Fund own an aggregate of 3,306 shares of Common Stock, representing less than
1% of the outstanding shares.
THE SOLICITATION
The Soliciting Shareholder has retained Georgeson to assist and to
provide advisory services in connection with this proxy solicitation for which
it will be paid a fee of $25,000 and will be reimbursed for reasonable
out-of-pocket expenses. The Soliciting Shareholder will indemnify Georgeson
against certain liabilities and expenses in connection with this proxy
solicitation, including liabilities under the federal securities laws. Other
than the nominees, no officers, directors or employees of the Soliciting
Shareholder will solicit proxies.
Banks, brokerage houses and other custodians, nominees and fiduciaries
will be requested to forward this Proxy Statement and the accompanying BLUE
proxy card to the beneficial owner of shares of Common Stock for whom they hold
of record and the Soliciting Shareholder will reimburse them for their
reasonable out-of-pocket expenses.
The expenses related to this proxy solicitation will be borne by the
Soliciting Shareholder. The Soliciting Shareholder estimates that the total
amount of expenses to be incurred by it in this proxy solicitation will be
approximately $______. Expenses to date have been approximately
$------.
If you have any questions concerning this Proxy Solicitation or the
procedures to be followed to execute and deliver a proxy, please contact
Georgeson at:
Georgeson & Company, Inc.
Wall Street Plaza, 30th Floor
New York, New York 10005
Call Toll-Free: 1-800-223-2064
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EXHIBIT 1
[Letterhead of Bankgesellschaft Berlin AG]
October 7, 1997
The Growth Fund of Spain, Inc.
222 South Riverside Plaza
Chicago, IL 60606
USA
Attention: Philip J. Collora, Secretary
Dear Mr. Collora:
Bankgesellschaft Berlin AG (the "Bank") is the holder of
1,514,300 shares of the common stock, par value $.01 per share (the "Common
Stock"), of The Growth Fund of Spain, Inc. (the "Fund"), representing
approximately 9.1% of the outstanding shares of Common Stock. We have reviewed
the preliminary proxy statement (the "Proxy Statement") of the Fund that was
filed with the United States Securities and Exchange Commission on September
29, 1997. The Proxy Statement relates to a Special Meeting of Shareholders of
the Fund scheduled for December 3, 1997 at which shareholders will be asked to
(i) elect two additional members to the Board of Directors of the Fund (the
"Board"), (ii) ratify the selection of the Fund's independent auditors for the
current fiscal year and (iii) approve or disapprove a new investment management
agreement and a new sub- advisory agreement. The vote on the new investment
management and sub-advisory agreement are being taken in anticipation of the
automatic termination of the Fund's existing investment management and
sub-advisory agreements, in accordance with the terms thereof, upon the
acquisition by Zurich Insurance Company ("Zurich"), the parent company of the
Fund's current investment manager, of approximately 70% of Scudder, Stevens &
Clark Inc. ("Scudder"). Upon completion of the acquisition, Scudder will change
its name Scudder Kemper Investments, Inc. ("SKI") and the Fund's current
investment manager will be combined with SKI.
The Proxy Statement states that the Audit and Governance
Committee of the Fund (the "Committee") proposes the nominees for election by
the shareholders of the Fund and that shareholders wishing to submit the name
of a candidate for consideration by the Committee may do so by contacting the
Secretary of the Fund. The Bank requests that the Committee nominate Gregory L.
Melville and Moritz A. Sell to the Board. Brief biographies of Messrs. Melville
and Sell are attached hereto as Annex A. Messrs. Melville and Sell have
confirmed to the Bank that they meet all requirements under the Investment
Company Act of 1940, as amended, and the Fund's articles of incorporation and
by-laws applicable to directors. They will complete a questionnaire prepared by
the Fund designed to confirm the foregoing. In the event that the Committee
determines not to nominate Messrs. Melville and Sell, the Bank would appreciate
the opportunity to discuss with the Committee the opportunity of nominating
other individuals to the Board in lieu of Messrs. Melville and Sell.
<PAGE>
Mr. Melville has extensive experience in risk management and
trading in international equities. Mr. Sell has significant experience in
international securities as both a trader and an analyst. As the Fund invests
primarily in the securities of Spain, their business experience would prove to
be an asset to the Fund.
The persistent discount from net asset value ("NAV") of the
shares of Common Stock is a concern to the Bank, as we are sure it is to most,
if not all, shareholders of the Fund. Messrs. Melville and Sell have indicated
to the Bank that, if elected to the Board, they will be committed to exploring
methods of reducing or eliminating the discount. Such methods might include
committing the Fund to disseminating NAV information on a daily basis,
converting the Fund to a close-end interval fund, open-ending the Fund, or
merging the Fund with an open-end fund, among others.
The Bank believes that the two nominees to the Board whose
names are contained in the Proxy Statement will not be genuinely committed to
reducing or eliminating the discount because both are affiliated with Scudder,
which will serve as the investment manager of the Fund after its acquisition by
Zurich. These two nominees will not possess the independence necessary to make
decisions relating to the reduction or elimination of the discount to NAV based
on the best interests of the shareholders of the Fund, as opposed to the best
interests of the Fund's investment manager. On the other hand, Messrs. Melville
and Sell will have the interests of increasing shareholder value as their
mandate.
We wish to thank the Committee for its attention to the
Bank's request that its nominees be considered for nomination to the Board and,
due to the time sensitivity, respectfully request a response to this letter by
October 13, 1997.
Very truly yours,
/s/ Serge Demoliere
Managing Director
/s/ Dirk Kipp
Director
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<PAGE>
ANNEX A
Gregory L. Melville (born July 22, 1956)
US Citizen
B.S. Engineering, 1978, United States Military Academy, West Point
1978 - 1983 US Army, Finance Officer
1983 - 1989 Self Employed in Financial Services Industry
1990 - 1995 Salomon Brothers, Investment Bank, Vice President
1995 - Present Bankgesellschaft Berlin, Bank, Assistant Director
Moritz A. Sell (born October 12, 1967)
US Citizen
B.A. Economics, 1989, George Washington University
1990 - 1994 Canadian Imperial Bank of Commerce, Bank, Vice President
1995 - 1996 Barclays de Zoete Wedd, Investment Bank, Analyst
1996 - Present Bankgesellschaft Berlin, Bank
- 3 -
<PAGE>
EXHIBIT 2
[Letterhead of Kemper Funds]
October 14, 1997
Mr. Serge Demoliere, Managing Director
Mr. Dirk Kipp, Director
Bankgesellschaft Berlin
Equities/Equity Derivatives
Alexanderplatz 2, D-10178
Berlin, Germany
Re: The Growth Fund of Spain, Inc.
-------------------------------
Dear Messrs. Demoliere and Kipp:
Your recent submission of proposed nominees for election as directors
of The Growth Fund of Spain, Inc. will be presented to the Audit and Governance
Committee of the Fund for consideration at their next regularly scheduled
meeting. Thank you for your interest in Kemper Funds.
Very truly yours,
The Growth Fund of Spain, Inc.
By:/s/ Philip J. Collora
----------------------------------
Philip J. Collora
Secretary
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<PAGE>
EXHIBIT 3
ALL SECURITIES OF THE FUND PURCHASED OR SOLD
WITHIN THE PAST TWO YEARS BY THE SOLICITING SHAREHOLDER
Except as disclosed in this Proxy Statement, neither the Soliciting
Shareholder nor its nominees for election to the Board of Directors of the Fund
has, or had, any interest, director or indirect, by security holdings or
otherwise, in the Fund. The following table sets forth certain information with
respect to purchases of shares of Common Stock by the Soliciting Shareholder.
Neither of the Soliciting Shareholder's nominees owns any shares of Common
Stock. Neither the Soliciting Shareholder nor either of its nominees for
election to the Board of Directors of the Fund has sold any shares of Common
Stock in the last two years. The Soliciting Shareholder has sold puts covering
the shares of Common Stock to third parties. If such puts are exercised by such
third parties, the Soliciting Shareholder will acquire an additional 23,500
shares of Common Stock, representing less than 1% of the outstanding shares.
Purchases of shares of Common Stock by the Soliciting Shareholder
-----------------------------------------------------------------
Date Number of Shares Purchased
---- --------------------------
February 21, 1997 75,700
February 24, 1997 33,600
February 25, 1997 35,000
February 26, 1997 84,300
February 27, 1997 46,600
February 28, 1997 27,300
March 3, 1997 35,000
March 4, 1997 5,500
March 5, 1997 10,000
March 6, 1997 9,000
March 7, 1997 6,500
March 21, 1997 26,700
April 2, 1997 10,000
April 3, 1997 3,900
April 4, 1997 40,000
April 10, 1997 16,000
April 11, 1997 50,000
April 14, 1997 1,700
April 15, 1997 3,000
April 16, 1997 8,000
April 22, 1997 1,400
April 24, 1997 1,500
April 25, 1997 20,600
May 1, 1997 14,100
May 5, 1997 6,000
May 15, 1997 10,300
<PAGE>
Date Number of Shares Purchased
---- --------------------------
May 16, 1997 19,800
May 19, 1997 33,000
May 20, 1997 4,600
May 21, 1997 17,000
May 22, 1997 20,000
May 23, 1997 700
May 28, 1997 10,500
May 29, 1997 100,000
June 2, 1997 12,700
June 3, 1997 8,500
June 5, 1997 3,200
June 9, 1997 41,700
June 10, 1997 73,500
June 12, 1997 5,500
June 16, 1997 15,000
June 17, 1997 20,400
June 23, 1997 51,000
June 24, 1997 21,000
June 27, 1997 5,000
July 3, 1997 5,300
July 7, 1997 9,200
July 9, 1997 23,200
July 21, 1997 20,000
July 28, 1997 60,000
July 30, 1997 5,000
August 4, 1997 170,000
August 5, 1997 6,600
August 8, 1997 100
August 11, 1997 10,000
August 12, 1997 5,000
August 19, 1997 30,000
August 21, 1997 8,600
August 22, 1997 4,200
August 26, 1997 7,400
August 27, 1997 3,200
August 28, 1997 7,400
August 29, 1997 3,200
September 3, 1997 49,700
September 4, 1997 5,900
September 5, 1997 3,800
September 11, 1997 7,100
September 12, 1997 8,700
September 15, 1997 8,400
September 16, 1997 3,700
September 22, 1997 700
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<PAGE>
Date Number of Shares Purchased
---- ---------------------------
September 23, 1997 1,500
September 24, 1997 5,900
October 22, 1997 2,200
October 23, 1997 10,000
October 24, 1997 50,300
October 27, 1997 1,900
October 28, 1997 400
October 30, 1997 22,000
October 31, 1997 9,100
November 12, 1997 10,000
November 12, 1997 50,000
November 13, 1997 27,000
- 3 -
<PAGE>
PRELIMINARY COPY -- SUBJECT TO COMPLETION
PROXY CARD
PROXY SOLICITED IN OPPOSITION TO
THE BOARD OF DIRECTORS OF
THE GROWTH FUND OF SPAIN
BY
BANKGESELLSCHAFT BERLIN AG
SPECIAL MEETING OF STOCKHOLDERS
TO BE HELD ON DECEMBER 3, 1997
The undersigned hereby appoints _____________________ and _________________,
and each of them, as the undersigned's proxies, with full power of substitution
to attend the Special Meeting of Stockholders of The Growth Fund of Spain, Inc.
(the "Fund") to be held in the Presentation Room on the 32nd Floor at the
offices of the Fund, 222 South Riverside Plaza, Chicago, Illinois, on
Wednesday, December 3, 1997, at 2:30 p.m., Chicago time, and any adjournment(s)
or postponement(s) thereof, and to vote on all matters that may come before
such meeting the number of shares that the undersigned would be entitled to
vote, with all the power the undersigned would possess if present in person, as
follows:
(INSTRUCTIONS: Mark votes by placing an "x" in the
appropriate o.)
<TABLE>
<CAPTION>
<S> <C> <C> <C>
1. ELECTION OF DIRECTORS.
FOR all nominees listed below. WITHHOLD AUTHORITY
(except as indicated to the contrary below) to vote for all nominees listed
below [ ]
GREGORY L. MELVILLE
MORITZ A. SELL
If you wish to withhold authority to vote for the election of any
individual nominee, write the name of that nominee below.
- ---------------------------------------------------------------------------
FOR AGAINST ABSTAIN
2. To ratify the selection of Ernst & Young LLP as independent
auditors for the current fiscal year. [ ] [ ] [ ]
3A. To approve a new investment management agreement with
Scudder Kemper Investments, Inc. ("SKI") (or with Zurich [ ] [ ] [ ]
Kemper Investments, Inc., transferable to SKI).
3B. To approve a new sub-advisory agreement with BSN Gestion
de Patrimonios, S.A., S.G.C. [ ] [ ] [ ]
4. IN THEIR DISCRETION, THE PROXIES ARE AUTHORIZED TO VOTE UPON SUCH OTHER
BUSINESS AS MAY PROPERLY COME BEFORE THE MEETING, AND ANY AND ALL
ADJOURNMENTS OR POSTPONEMENTS THEREOF, AS PROVIDED IN THE PROXY
STATEMENT PROVIDED HEREWITH.
</TABLE>
IMPORTANT - PLEASE SIGN AND DATE THE REVERSE SIDE.
<PAGE>
SHARES WILL BE VOTED AS DIRECTED. IF NO DIRECTION IS MADE, THIS PROXY WILL BE
VOTED FOR THE ELECTION OF ALL NOMINEES NAMED ABOVE IN ITEM 1 AND THIS PROXY
WILL ABSTAIN FROM VOTING ON PROPOSALS 2, 3A AND 3B. THE UNDERSIGNED HEREBY
ACKNOWLEDGES RECEIPT OF THE PROXY STATEMENT DATED ______________, 1997 OF
BANKGESELLSCHAFT BERLIN AG. THE UNDERSIGNED HEREBY REVOKES ANY PROXY HERETOFORE
EXECUTED BY THE UNDERSIGNED RELATING TO THE SUBJECT MATTER HEREOF AND CONFIRMS
ALL THAT THE PROXIES MAY LAWFULLY DO BY VIRTUE HEREOF.
(IMPORTANT - PLEASE FILL IN DATE)
This proxy card is provided by Bankgesellschaft Berlin AG, a shareholder of the
Fund.
Please sign exactly as your name appears hereon or on proxy cards previously
sent to you. When shares are held by joint tenants, both should sign. When
signing as an attorney, executor, administrator, trustee or guardian, please
give full title as such. If a corporation, please sign in full corporate name
by the President or other duly authorized officer.
If a partnership, please sign in partnership name by authorized person.
SIGNATURE(S) _______________________________________________ Dated: __________
Please sign as registered and return promptly in the enclosed envelope.
Executors, trustees and other signing in a representative capacity should
include their names and the capacity in which they sign.
