Securities and Exchange Commission
Washington, D.C. 20549
-------------------------------
SCHEDULE 13D
Under the Securities Exchange Act of 1934
(AMENDMENT NO. 4)
The Emerging Germany Fund Inc.
- - ------------------------------------------------------------------------------
(Name of Issuer)
Common Stock
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(Title of Class of Securities)
290913102
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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)
December 18, 1998
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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. [ ]
<PAGE>
CUSIP No.: 290913102 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
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NUMBER OF | | SOLE VOTING POWER
SHARES | 7 | 1,372,150
============================================================================
BENEFICIALLY | | SHARED VOTING POWER 0
OWNED | 8 |
============================================================================
BY EACH | | SOLE DISPOSITIVE POWER 1,372,150
REPORTING | 9 |
============================================================================
PERSON | | SHARED DISPOSITIVE POWER 0
WITH | 10 |
============================================================================
11 AGGREGATE AMOUNT BENEFICIALLY OWNED
BY EACH REPORTING PERSON 1,372,150
=======================================================================
12 CHECK IF THE AGGREGATE AMOUNT IN ROW [ ]
(11) EXCLUDES CERTAIN SHARES
=======================================================================
13 PERCENT OF CLASS REPRESENTED BY
AMOUNT IN ROW (11) 9.8%
=======================================================================
14 TYPE OF REPORTING PERSON IA
======================================================================
<PAGE>
CUSIP No.: 290913102 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 | 659,000
=====================================================================
BENEFICIALLY | | SHARED VOTING POWER 0
OWNED | 8 |
====================================================================
BY EACH | | SOLE DISPOSITIVE POWER 659,000
REPORTING | 9 |
=====================================================================
PERSON | | SHARED DISPOSITIVE POWER 0
WITH | 10 |
======================================================================
11 AGGREGATE AMOUNT BENEFICIALLY OWNED
BY EACH REPORTING PERSON 659,000
=====================================================================
12 CHECK IF THE AGGREGATE AMOUNT IN ROW [ ]
(11) EXCLUDES CERTAIN SHARES
=========================================================================
13 PERCENT OF CLASS REPRESENTED BY
AMOUNT IN ROW (11) 4.7%
=======================================================================
14 TYPE OF REPORTING PERSON IA
=========================================================================
<PAGE>
This Amendment No. 4, amends and supplements information in Item 4 and Item 7.
ITEM 4. PURPOSE OF TRANSACTION
On December 18, 1998 the reporting persons filed a preliminary proxy with the
SEC in opposition to the December 16, 1998 preliminary proxy of the issuer
(The Emerging Germany Fund, Inc.) in connection with the annual meeting of
stockholders scheduled for January 26, 1999. The opposition proxy presented
four alternate nominees for Director: Ronald Olin, Ralph Bradshaw, Gary Bentz,
and William Clark, all of whom are affiliated with Deep Discount Advisors Inc.,
one of the reporting persons.
If elected, the opposition nominees would attempt to implement a proportionate
distribution of the Fund's assets, as soon as possible, at full Net Asset Value
(NAV), to all shareholders who do not wish to remain in the Fund. Further, they
would execute an open-ending of the Fund as cheaply and quickly as possible WITH
NO REDEMPTION FEES WHATSOEVER if the open-ending proposal presented to
shareholders were approved.
Proxies will also be solicited in connection with two proposals submitted by
other shareholders which the issuer has refused to include in its proxy. The
two proposals include a resolution removing from office those Directors not
standing for election and a resolution recommending that the Board seek
reimbursement from the investment advisor and/or other responsible parties for
costs associated with litigation and delaying the 1998 annual meeting.
Contrary to previous determinations, the reporting persons have now concluded
that it is necessary to engage in this opposing proxy solicitation so that
active participation by stockholders on the Board can assure that the best
interests of all stockholders are satisfied.
The reporting persons are not interested in competing for the Fund's advisory
contract and would not agree to be the replacement for the current advisor if
its advisory contract were terminated.
On December 18, 1998, the reporting persons provided advanced notice to the
issuer as required in the issuer's by-laws to nominate directors and present
proposals at the 1998 annual meeting.
There has been no change in the plans and intentions of the reporting persons
other than those included in this filing. In particular, there can be no
assurance that the reporting persons will continue as shareholders of the
issuer, or will either increase or decrease the number of shares that they
control.
<PAGE>
ITEM 7. MATERIAL TO BE FILED AS EXHIBITS
The preliminary proxy filed by Deep Discount Advisors, Inc., on
December 18, 1998, which precipitates this amendment, is attached as
Exhibit 5.
<PAGE>
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: December 18, 1998 Deep Discount Advisors, Inc.
By: /s/ Ralph W. Bradshaw
----------------------------
Name: Ralph W. Bradshaw
Title: Secretary
Exhibit 5
THE EMERGING GERMANY FUND INC PREC14A
Filing Date: 12/18/98
1
2
3
4
TYPE: PREC14A
SEQUENCE: 1
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE
SECURITIES EXCHANGE ACT OF 1934
Filed by 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 Sec. 240.14a-11(c) or Sec. 240.14a-12
THE EMERGING GERMANY FUND, INC.
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(Name of Registrant as Specified in its Charter)
Deep Discount Advisors, Inc.
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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:
_______________________________________
Deep Discount Advisors, Inc.
One West Pack Square, Suite 777, Asheville, NC 28801
828-274-1863 Fax: 828-255-4834 E-mail: [email protected]
Dear Fellow Stockholders:
I am President of Deep Discount Advisors, Inc., and General Partner of Ron Olin
Investment Management Company, both registered investment advisors, which are
the Soliciting Shareholders ("Soliciting Shareholder") for this Proxy.
As a long-term stockholder of The Emerging Germany Fund, Inc. (the "Fund"), I am
concerned about the lack of commitment to maximizing shareholder value shown by
the current manager and the Board, which I believe it controls. After a long
campaign in which it resisted effective action to eliminate the discount, the
Board has now recommended open-ending the Fund, but only on its own timetable
and only after extracting a penalty (known as a redemption fee) on redeeming
shareholders. We believe more effective and expedient action can be taken to
deliver full Net Asset Value (NAV) to shareholders.
In order to give stockholders a stronger voice on matters affecting the value of
their investments in the Fund at the 1998 Meeting of Stockholders, we intend to
nominate four persons for election as directors of the Fund. We also intend to
introduce two proposals submitted by other stockholders that the Fund has
refused to include in its proxy. The meeting will be held on January 26, 1999.
The persons we intend to nominate for election as directors are: Ronald G. Olin,
Ralph W. Bradshaw, Gary A. Bentz, and William A. Clark. Each is committed to
delivering full NAV to all shareholders as soon as possible with no redemption
penalty. Each is also committed to execute the recommendations of those
shareholders wishing to remain in the fund while keeping related expenses to a
minimum. If elected, Messrs. Olin, Bradshaw, Bentz, and Clark would encourage
the Board of Directors to consider and to implement a variety of actions
designed to enhance stockholder value as expeditiously and inexpensively as
possible.
These actions will include, but are not limited to:
- A proportionate distribution of the Fund's assets as soon as possible, at
full NAV, to all shareholders who do not wish to remain in the Fund. This
would be done without disrupting the Fund's portfolio or creating a tax
impact on remaining shareholders;
- Implementing an open-ending of the Fund as cheaply and quickly as possible
WITH NO REDEMPTION FEES WHATSOEVER if the open-ending proposal presented to
shareholders is approved;
- A cost-effective and timely implementation of any and all other actions
approved by shareholders in the annual meeting, including any shareholder
resolutions that receive a majority of the votes cast.
At the meeting, we will introduce for a vote by stockholders the following
proposals submitted by other shareholders which the Fund has declined to include
in its proxy:
- A resolution removing from office those Directors not standing for election;
- A resolution recommending that the Board seek reimbursement from the
investment advisor and/or other responsible parties for costs associated with
litigation and delaying the 1998 annual meeting.
We believe that both the management of the Fund and the Fund's Board of
Directors have been unresponsive to the legitimate concerns of long-term
stockholders. Consequently, we now believe that the only way to assure that
stockholder interests are given primary consideration is through significant
stockholder representation on the Board of Directors. We are not interested in
competing for the Fund's advisory contract and would not agree to be the
replacement for the manager if their advisory contract were terminated.
Last April I was sued by the Fund, along with others, claiming that all of us
had engaged in an undisclosed scheme to wage an unregulated proxy contest for
control of the Fund for the purpose of "forcing the Fund to convert from a
closed-end fund to an open-end fund" and to make a "quick profit at the expense
of other shareholders." I believe there is something wrong when a fund sues its
own shareholders rather than talking to them, cancels its annual meeting, spends
hundreds of thousands of dollars on litigation, and later concludes that it
would be better after all for the Fund to be open-ended. I believe the Fund's
shareholders could be better served by their Board, their lawyers, and their
manager.
We cannot afford to spend a lot of money on expensive legal work, multiple
mailings, and proxy solicitors who will call you on the telephone and try to
record your vote. Indeed, we suspect that the Fund will spend our money, and
yours, to do exactly that. They will make it as easy as possible for you to
record your vote for management, the current Board, and their recommendations.
We believe the management of this Fund and the current Board have not served
your best interests. You have a chance to vote your own pocketbook. We
represent substantial shareholder interests and, if you elect us, we will
represent your interests as shareholders. Please vote and return the green
proxy card.
Please read the attached Proxy Statement carefully. It contains additional
information about the persons we plan to nominate for election as directors and
the proposals we will introduce on behalf of other shareholders.
To enable us to vote your shares on these issues, PLEASE MARK, SIGN, and DATE
AND RETURN THE ENCLOSED [GREEN] PROXY CARD IN THE POSTAGE PRE-PAID ENVELOPE THAT
HAS BEEN PROVIDED. You may vote on all proposals contained in the Fund's
[WHITE] proxy card by using the enclosed [GREEN] proxy card. Instructions for
executing the [GREEN] proxy card are on the next page.
If you have already returned the [WHITE] proxy card sent to you by the Fund, you
may revoke that proxy and vote for our nominees and proposals by marking,
signing, dating, and mailing a later dated [GREEN] proxy card.
AFTER SUBMITTING A [GREEN] PROXY CARD, PLEASE DO NOT RETURN A [WHITE] PROXY CARD
(EVEN IF YOU ARE VOTING AGAINST THE NOMINEES NAMED IN THE FUND'S PROXY
STATEMENT). DOING SO WILL REVOKE YOUR [GREEN] PROXY CARD.
If you have any questions, please call me at (828) 274-1863
Sincerely yours,
Ronald G. Olin
TO SUPPORT OUR EFFORTS TO ENHANCE STOCKHOLDER VALUE, PLEASE MARK,
DATE, SIGN, AND RETURN THE ENCLOSED [GREEN] PROXY CARD USING THE ENCLOSED
POSTAGE PRE-PAID ENVELOPE.
VOTING INFORMATION
The Fund's proxy materials include proposals relating to the election of
Directors, ratification of the selection of the Fund's independent Accountants,
changing the name of the Fund, terminating the investment advisory contract,
open-ending the Fund, and conversion to a broad-based European fund. You may
vote on each of the matters contained in the Fund's proxy statement, as well as
additional shareholder proposals by completing and returning the enclosed
[GREEN] proxy card.
The Soliciting Shareholder is not making any recommendation as to how you should
vote on ratification of the selection of the Fund's independent accountants.
A [GREEN] proxy card which is returned to the Soliciting Shareholder or its
agent will be voted as you indicate on the card. If a [GREEN] proxy card is
returned without indicating how to vote on a matter, your shares will be voted
FOR the election of our nominees, FOR the expansion of the Fund's investment
objective to a broad-based European fund, FOR a proposal requiring the removal
of Directors not standing for election, FOR a proposal recommending the Board
seek reimbursement of recent litigation expenses from the investment advisor,
and will ABSTAIN on the proposal to ratify the selection of the Fund's
independent accountants. All other stockholder proposals contained in this
proxy or introduced at the meeting for which you have not indicated your
preference will be voted at the time of the meeting by the Soliciting
Shareholder in accordance with the best interests of the stockholders in the
sole judgement and opinion of the Soliciting Shareholder.
If you have already returned the [WHITE] proxy card that was sent to you by the
Fund, you may revoke that proxy and vote for the Soliciting Shareholder's
nominees and proposals by marking, signing, dating, and mailing a later dated
[GREEN] proxy card.
Completing and returning a [WHITE] proxy card, even to vote against the nominees
named in the Fund's proxy statement, after you return the enclosed [GREEN] proxy
card will revoke the proxy given in the [GREEN] card. Therefore, DO NOT return
a [WHITE] proxy card after returning the [GREEN] card, unless you wish to
completely cancel ALL of your choices on the [GREEN] proxy card.
PROXY STATEMENT IN OPPOSITION TO SOLICITATION BY THE BOARD
OF DIRECTORS OF THE EMERGING GERMANY FUND, INC.
ANNUAL MEETING OF STOCKHOLDERS
To be held on January 26, 1999
This proxy statement and the enclosed [GREEN] proxy card are being furnished to
holders of record on December 4, 1998 (the "Record Date") of shares of common
stock, par value $.01 per share (the "Common Stock"), of The Emerging Germany
Fund, Inc., a Maryland corporation (the "Fund"), by Deep Discount Advisors, Inc.
and Ron Olin Investment Management Company, both registered investment advisors,
(the "Soliciting Shareholder"), in connection with the solicitation of proxies
by the Soliciting Shareholder for use at the 1998 Annual Meeting of the Fund to
be held on January 26, 1999, at 75 Wall Street (Lower Level), New York, New York
10005 at 10:00 a.m., New York time. The principal executive offices of the Fund
are located at Four Embarcadero Center, San Francisco, California 94111. The
Soliciting Shareholder is soliciting a proxy to vote your shares at the 1998
Annual Meeting of Stockholders of the Fund and at any and all adjournments or
postponements of the meeting.
This proxy statement and the enclosed [GREEN] proxy card are
first being sent to stockholders of the Fund on or about December ___,
1998.
INTRODUCTION
There are five matters that the Fund has scheduled to be voted on at the
meeting:
1(a) Expansion of the Fund's investment objective from a
predominantly German investment portfolio to a broader
European investment portfolio, ("Conversion to European Fund").
1(b) Amendment of the Fund's Articles of Incorporation to change
the Fund's name to Dresdner RCM Europe Fund, Inc.
2(a) Conversion of the Fund from a closed-end investment
company to an open-end investment company under the 1940
Act and the amendment and restatement of the fund's Articles
of Incorporation.
2(b) Modification and elimination of certain of the Fund's
fundamental investment restrictions.
2(c) Approval or disapproval of the Investment Management Agreement.
2(d) Approval or disapproval of the Rule 12B-1 Distribution Plan.
3. To elect four Directors of the Fund, each to hold office
for a term of three years and until his successor is duly
elected and qualifed.
4. To ratify the selection of PricewaterhouseCoopers LLP
as independent accountants of the fund for the fiscal year
ending December 31, 1999.
5. A stockholder proposal to terminate the Fund's
advisory agreement with Dresdner RCM Global Investors
LLC, ("Advisor"), which serves as the investment advisor
of the Fund (the "Contract Termination Proposal").
With respect to these matters, the Soliciting Shareholder is soliciting a proxy
to vote your shares:
* IN FAVOR of the election of four persons whom the Soliciting
Shareholder intends to nominate for election as directors of the
Fund; and
* IN FAVOR of the Conversion to European Fund proposal.
With regard to item 1(b), changing the name of the Fund, all parts of item 2,
the open-ending proposal, and item 5, the Contract Termination Proposal, the
Soliciting Shareholder will vote in accordance with your wishes on those
matters. If no instructions are given, the Soliciting Shareholder will vote in
accordance with the best interests of all shareholders at the time of the Annual
Meeting. This decision will be made in the sole discretion of the Soliciting
Shareholder, unless otherwise specified by you on the [GREEN] Proxy card.
The Soliciting Shareholder is making no recommendation on how shares should be
voted on the ratification of the selection of the Fund's independent accountants
and will ABSTAIN if no preference is indicated.
The Soliciting Shareholder is also soliciting your proxy to vote your shares on
the following proposals which were made by other stockholders and which we
intend to introduce at the meeting (but which do not appear in the Fund's proxy
statement or on its [white] proxy card):
6. A stockholder resolution as follows:
RESOLVED: The Class II and Class III Directors of the Emerging
Germany Fund (the "Fund") are hereby removed.;
7. A stockholder resolution as follows:
RESOLVED: That Fund shareholders believe costs associated with
litigation delaying the 1998 annual meeting were unnecessary,
harmful to shareholder interests, and a waste of corporate assets.
As one reasonable remedy, shareholders recommend that the Board in
charge after the 1998 annual meeting seek reimbursement, through
legal means if necessary, from the investment advisor and/or other
responsible parties for the applicable legal and other expenses
charged to the Fund.
How Proxies Will Be Voted
All of the proposals scheduled by the Fund to be voted on at the meeting are
included in the enclosed [GREEN] proxy card. If you wish to vote IN FAVOR of
our nominees, and FOR any of the other proposals, you may do so by completing
and returning a [GREEN] proxy card.
If you return a [GREEN] proxy card to the Soliciting Shareholder or its agent,
your shares will be voted on each matter as you indicate. If you do not
indicate how your shares are to be voted on a matter, they will be voted FOR the
election of our nominees for director, FOR item 1.a, Conversion to European Fund
proposal, FOR the proposal to remove Class II and Class III Directors, FOR the
resolution recommending that the Fund seek reimbursement of litigation costs
from the Fund's investment advisor. If you do not indicate how to vote on the
ratification of the selection of the Fund's independent accountants, your shares
will be voted TO ABSTAIN on that matter. All other stockholder proposals
contained in this proxy or introduced at the meeting will be voted at the
time of the meeting by the Soliciting Shareholder in accordance with the best
interests of the stockholders, in the sole judgement and opinion of the
Soliciting Shareholder.
If you return a [GREEN] proxy card, you will be granting the persons named as
proxies discretionary authority to vote on any other matters of which they are
not now aware that may come before the meeting. These may include, among other
things, matters relating to the conduct of the meeting and proposals of other
stockholders.
before the meeting. These may include, among other
things, matters relating to the conduct of the meeting and proposals of other
stockholders.
Voting Requirements
Only stockholders of record on the Record Date are entitled to vote at the
meeting. According to the Fund's Current proxy statement, there were 14,008,334
Shares of Common Stock issued and outstanding as of the close of business on
December 4, 1998. Holders of record on the Record Date will be entitled to cast
one vote on each matter for each share of Common Stock held. For Proposal 3,
(election of four Directors of the Fund), directors are elected by a plurality
of the votes cast. Proposal 4, (ratification of the selection of the Fund's
independent accountants), and Proposal 7, (stockholder recommendation that the
Board seek reimbursement of recent litigation expenses from the investment
advisor), as described in this proxy statement, each require the affirmative
vote of a majority of the shares voting on the matter. Proposal 5,(Contract
Termination Proposal), Proposal 1(a), (Conversion to European Fund proposal),
Proposal 2(b),(the modification and elimination of certain of the fund's
fundamental investment restrictions), Proposal 2(c), (the Investment Management
Agreement), and Proposal 2(d), (the Rule 12b-1 Distribution Plan), each require
the vote of a majority of the outstanding voting securities of the Fund, as
defined by the Investment Company Act of 1940 (the "1940 Act"). This majority
means the lesser of: (1) 67% or more of the Common Stock of the Fund present at
the meeting, if the holders of more than 50% of the outstanding Common Stock are
present or represented by proxy; or (2) more than 50% of the outstanding Common
Stock. Proposal 1(b), (Amendment of Articles of Incorporation to change the
Fund's name to "Dresdner RCM Europe Fund Inc."), requires the affirmative vote
of two-thirds of all the votes entitled to be cast on the matter. The approval
of proposal 2(a), (conversion of the Fund to an open-end fund), requires the
affirmative vote of a majority of the Fund's outstanding shares. According to
the Fund's By-Laws, the approval of Proposal 6, (the Removal of Class II and
Class III Directors), requires the affirmative vote of a majority of all shares
entitled to be cast on the matter.
If a proxy is properly executed and returned, accompanied by instructions to
withhold authority to vote, it represents a broker "non-vote" (that is, a proxy
from a broker or nominee indicating that such person has not received
instructions from the beneficial owner or other person entitled to vote shares
on a particular matter with respect to which the broker or nominee does not have
discretionary power). The Fund intends to treat properly executed proxies that
are marked "abstain" and broker "non-votes" as present at the Meeting for the
purposes of determining whether a quorum has been achieved at the Meeting.
Under Maryland law, abstentions do not constitute a vote "for" or "against" a
matter and will be disregarded in determining the "votes cast" on an issue.
Broker "non-votes" will be treated the same as abstentions. With respect to
proposals to be determined by an affirmative vote of a specified majority of the
total shares outstanding, such as proposal Nos. 1(a), 1(b), 2(a), 2(b), 2(c),
2(d), and 5, an abstention or broker "non-vote" will be considered present for
purposes of determining a quorum but will have the effect of a vote "against"
such matters. With respect to proposals to be determined by a specified
majority or plurality of the votes cast at the Meeting, such as Proposal Nos. 3
and 4, an abstention or broker "non-vote" will be considered present for
purposes of determining a quorum but will have no effect on the outcome of such
matters.
The presence, in person or by proxy, of the holders of more than 50% of the
shares of Common Stock of the Fund entitled to vote at the meeting will
constitute a quorum for the transaction of business. If a quorum is not present
at the meeting, or if a quorum is present but sufficient votes to approve any of
the stockholder proposals are not received, the persons named as proxies may
propose one or more adjournments of the meeting to permit further solicitation
of proxies. The proxies may also propose an adjournment for other reasons. Any
adjournment will require the affirmative vote of a majority of those shares
present at the meeting in person or by proxy. If an adjournment of the meeting
is proposed, the persons named as proxies on the [GREEN] proxy card will vote
for or against such adjournment in their discretion.
Revocation of Proxies
You may revoke any proxy you give to management or the Soliciting
Shareholder at any time prior to its exercise in the following ways:
Deliver a written revocation of your proxy to the Secretary of
the Fund;
Execute and deliver a later dated proxy to the Soliciting Shareholder
or to the Fund or our respective agents; or
Vote in person at the meeting. (Attendance at the meeting
will not in and of itself revoke a proxy.)
There is no limit on the number of times you may revoke your
proxy prior to the meeting. Only the latest dated, properly signed
proxy card will be counted.
INFORMATION CONCERNING THE SOLICITING SHAREHOLDER
The beneficial shareholders making this solicitation are Deep Discount Advisors,
Inc. and Ron Olin Investment Management Company, both registered investment
advisors. These companies presently manage investment portfolios having assets
of approximately $180 million.
Our address is One West Pack Square, Suite 777, Asheville, NC 28801.
As of the Record Date, the Soliciting Shareholder has the beneficial ownership
of 2,031,150 shares of Common Stock of the Fund, held by principals and clients
of the companies and representing approximately 14.5 % of the issued and
outstanding shares of Common Stock of the Fund.
Exhibit 1 to this proxy statement contains a schedule showing the purchases and
sales of Common Stock of the Fund by the Soliciting Shareholder within the past
two years.
The Soliciting Shareholder has made the decision to seek Board representation
after an extended period of unsatisfactory shareholder results. Moreover, the
Soliciting Shareholder is concerned about the long-term lack of commitment from
the current Board and investment manager to maximizing shareholder value.
A summary of communication regarding the Fund follows below:
1. 6/12/97 First Reported Filing - In a 13G filing with the SEC on 6/12/97,
a copy of which was sent directly to the Fund, the Soliciting Shareholders
indicated ownership of 10.6% of the Fund or 1,491,800 shares. An accompanying
cover letter to Rolf Passow, Chairman and the Board of Directors included the
following statement: "...under SEC guidelines, institutional shareholders may
communicate their opinions about how they might vote on important corporate
matters without violating the restrictions of this filing. We will support
those corporate resolutions and directors most committed to completely
eliminating discounts for their shareholders in as effective and timely a manner
as possible, whether it is through liquidation, open-ending, or self-tender for
all shares of the fund."
2. 12/29/97 Updated Filing - In an updated 13G filing with the SEC on
12/29/97, the Soliciting Shareholders indicated updated ownership of 14.0% of
the Fund or 1,957,100 shares
3. 3/27/98 Intended Letter to Fund Shareholders - The Soliciting Shareholder
composed an "Exempt Shareholder Communication", a letter to other shareholders
indicating its negative opinions about the performance of the Fund and the
Fund's failure to deal adequately with the discount. The letter also indicated
how the soliciting shareholder intended to vote its own proxy in the anticipated
April 27, 1998 annual meeting of shareholders. Copies of the intended letter
were sent to the SEC according to Rule 14(a)103 and 14(a)6(g). The Soliciting
Shareholder then became aware on 4/7/98 that the Fund was attempting to prevent
the letter from being sent. The Soliciting Shareholder contacted the SEC and
attorneys for the organization selected for the shareholder mailing and secured
the right to have the letter sent.
4. 4/8/98 Soliciting Shareholder is Sued by the Fund - The Fund announced
through a press release that it was canceling its annual meeting and intended to
take legal action against certain shareholders without mentioning the Soliciting
Shareholder by name. The Soliciting Shareholder called the Fund's secretary and
inquired when the meeting would be held. After hearing that no date was
scheduled, the Soliciting Shareholder told the Fund's secretary that he was not
sending the letter to shareholders at this time since the meeting had been
indefinitely postponed. The Soliciting Shareholders did not know, and was not
told, that he was to be a party to the Fund's legal action. The next day the
soliciting shareholder was served as a party in the Fund's law suit. The suit
alleges that Ron Olin and Deep Discount Advisors,Inc. among others, engaged in
an undisclosed scheme to wage an unregulated proxy contest for control of
Emerging Germany Fund for the purpose of forcing the Fund to convert from a
closed-end fund to an open-end fund to make a quick profit at the expense of
other shareholders. It claims that the defendants significantly advanced their
illegal scheme by using an internet chat room to communicate with each other in
public, and illegally allowed anyone who signed on to the chat room to listen to
their communication with each other and to join the discussion with their
opinions. Further details concerning the legal action are included in Exhibit
2.
5. 6/22/98 Updated Filing and Motion for Dismissal - In a 13D filing with
the SEC on 6/22/98, the Soliciting Shareholder indicated updated ownership of
14.7% of the Fund or 2,062,950 shares. The filing also included a copy of the
law suit, denied all of the allegations, and indicated that the soliciting
shareholder had filed a motion to dismiss all the claims made in the suit. The
motion to dismiss is still pending in court.
6. 7/14/98 Letter to the Board and Board Meeting - A meeting was scheduled to
take place on 7/21/98 between Ron Olin and a committee of the Fund's Board. In
preparation for that meeting, a letter was sent to the Board documenting the
disappointing long-term performance of the Fund, and suggesting actions which
might be taken to increase shareholder results by reducing or eliminating the
discount at which the shares of the Fund were trading. The actions suggested
included a program of unlimited, perpetual share buybacks by the Fund of its own
shares and/or a distribution of the Funds assets at full Net Asset Value to
those shareholders who were unsatisfied with the Fund's structure as a
closed-end fund. A copy of the letter sent to the Fund's Board is included
as Exhibit 3. The meeting took place and nothing of substance resulted.
7. 8/3/98 Request for Further Board Meeting - In a 13D filing with the SEC
on 8/3/98, the Soliciting Shareholder included a letter to the Fund requesting a
second meeting with the Board to resolve differences, reduce or eliminate the
Fund's discount, end the litigation, and allow the Fund to hold its annual
meeting. No such meeting was ever agreed to by the Board.
8. 11/6/98 Request to Nominate Directors - In a 13D filing with the SEC on
11/6/98, the Soliciting Shareholder disclosed a letter to the Fund requesting
that the Board nominate for Director the individuals described in this proxy. A
copy of the letter is included as Exhibit 4.
9. 12/11/98 Final Communication and Offer - On 12/11/98, before the Fund had
made its complete intentions known regarding the annual meeting, Ronald G. Olin
called the Secretary of the Fund and offered to support the Fund's
recommendations in the upcoming annual meeting and withdraw its request for
nominee Directors if the Fund agreed to the following: (1) No redemption Fee in
its open-ending proposal, (2) a commitment to complete the open-ending by March
15, 1999, and (3) reimbursement of the Soliciting Shareholder's out-of-pocket
legal expenses in defending against the Fund's law suit. The offer was
conditional on a response by Monday, December 14 which response was not
forthcoming. Consequently, after a thorough consideration of all its options,
the Soliciting Shareholder concluded that it would be in the best interests of
all shareholders to have another choice in the upcoming annual meeting.
Thereafter, this opposing proxy was filed in response to the Fund's proxy first
made available for review on December 16.
REASONS FOR THE SOLICITATION
In our view, management and the current Board are not sufficiently committed to
enhancing stockholder value. For this reason, the Soliciting Shareholder is
soliciting your vote to elect Messrs. Olin, Bradshaw, Bentz, and Clark to the
Board of Directors and to effect various stockholder proposals, which we believe
will enhance stockholder value.
The election of Messrs. Olin, Bradshaw, Bentz, and Clark as directors will
provide stockholders with an independent voice on important matters affecting
the Fund. Their election will give the Board a new perspective and will help
assure that measures intended to benefit stockholders are more actively
considered. The approval of various proposals will also further these goals to
the extent that they may result in:
* making full Net Asset Value available as soon as possible
to those shareholders who wish to exit the Fund; and
* greater shareholder guidance to the Board, enhancing its ability to
act in the best interests of stockholders.
If you share these goals, we urge you to vote for our nominees and proposals,
using the enclosed [GREEN] proxy card.
CERTAIN CONSIDERATIONS
In deciding whether to give the Soliciting Shareholder your proxy, you should
consider the following information.
Even if our nominees are elected and our proposals are approved by stockholders,
there can be no assurance that the full Board of Directors will take any actions
that we may advocate or that such actions, if taken, will achieve their intended
goals. Our nominees will, if elected, represent only four of the Fund's ten
directors, absent the resignation or removal of any Class II or Class III
directors.
Implementation of certain Board actions may require stockholder approval, and no
assurance can be given that such approval will be obtained. In addition,
various costs, which would be borne indirectly by stockholders, may be
associated with certain actions, including but not limited to those associated
with holding a special meeting of stockholders.
We believe that all stockholders of the Fund will benefit if any actions taken
to improve stockholder value, to expedite the delivery of NAV to those
stockholders who wish to redeem their shares, or to reduce the fees and expenses
associated with the redemption of shares are successful. However, the
Soliciting Shareholder is paid fees by its clients who hold shares of the Fund.
These fees will be greater if the value of the Fund's shares increases and, in
some cases, are based upon a share of the profits the client earns.
If the Contract Termination Proposal is approved, it will be necessary for the
Fund to retain a new investment adviser and obtain approval of an investment
advisory agreement with the new adviser by the Board of Directors of the Fund,
including the vote of a majority of the directors who are not "interested
persons" of the Fund as defined by the 1940 Act, and by stockholders of the
Fund. No assurance can be given that a new adviser will be identified or
approved prior to the date as of which the investment advisory agreement with
Dresdner RCM Global Investors LLC terminates. In such event, the Fund might
have to implement interim arrangements to assure continued management of the
Fund's assets, which might require the issuance of an order by the Securities
and Exchange Commission (and of which there can be no assurance).
Alternatively, the Board of Directors or officers of the Fund would have to
manage the Fund's investment portfolio.
Ron Olin and Deep Discount Advisors, Inc. are parties to a pending legal action
involving The Emerging Germany Fund. These actions are described in Exhibit 2.
In that action, the Fund has alleged that the Soliciting Shareholder has
violated certain provisions of the Federal securities laws in connection
with the solicitation of proxies. Both Ron Olin and Deep Discount Advisors,
Inc. vigorously deny the allegation and have moved for dismissal.
ELECTION OF DIRECTORS
At the meeting, stockholders will have the opportunity to elect four persons as
directors of the Fund. The Fund currently has a total of ten directors,
divided into three classes. There are presently four 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. Each person elected as a
director at the meeting will be a Class I director and have a term expiring in
2001.
The Soliciting Shareholder will nominate Messrs. Olin, Bradshaw, Bentz, and
Clark for election as Class I directors of the Fund. Information about the
nominees is as follows:
Name, Business Address Age Principal Business Occupations
- ---------------------- --- ---------------------------------------------
Ronald G. Olin 53 Mr. Olin is President and Chief Executive
One West Pack Square Officer of Deep Discount Advisors, Inc. and
Suite 777 General Partner of Ron Olin Investment
Asheville, NC 28801 Management Co. Both firms are registered
investment advisors specializing in
investments in closed-end funds. He
currently serves as Chairman of the
Board of Clemente Global Growth Fund, a NYSE
Traded closed-end fund with an
Internationally diversified portfolio. Prior
to founding these investment management
firms, Mr. Olin was a senior manager with IBM
supporting government software contracts with
the N.A.S.A. and D.O.D.
Number of Shares Owned
Directly or Indirectly
As of December 4, 1998 468,300
Ralph W. Bradshaw 48 Mr. Bradshaw has served as Vice President and
One West Pack Square Secretary of Deep Discount Advisors, Inc., a
Suite 777 registered investment advisor specializing in
Asheville, NC 28801 closed-end fund investments, for over five
years. During that period he has also
provided financial consulting services in the
area of closed-end funds. In previous years,
he has held various managerial positions.
Mr. Bradshaw currently serves as a Director
on the Board of Clemente Global Growth Fund,
a NYSE-traded closed-end fund with an
internationally diversified portfolio.
Number of Shares Owned
Directly or Indirectly
As of December 4, 1998 500
Gary A. Bentz 42 Mr. Bentz has served as Vice President and
One West Pack Square Chief Financial Officer of Deep Discount
Suite 777 Advisors, Inc., a registered investment
Asheville, NC 28801 advisor specializing in closed-end fund
investments, for over five years. He has
also provided financial accounting,
investment analysis and consulting services
to companies and private investors for the
last 13 years. After commencing his career
with Arthur Andersen & Co., Mr. Bentz held
various financial managerial positions in
industry. He currently serves as a Director
on the Board of Clemente Global Growth Fund,
a NYSE-traded closed-end fund with an
internationally diversified portfolio.
Number of Shares Owned
Directly or Indirectly
As of December 4, 1998 3,100
William A. Clark 53 Since 1995 Mr. Clark has served as Director
One West Pack Square of Research for Deep Discount Advisors, Inc.
Suite 777 Inc., a registered investment advisor
Asheville, NC 28801 specializing in closed-end fund investment,
in addition to providing consulting services
in closed-end fund portfolio management.
Mr. Clark has served as an investment
analyst and advisor to private clients for
over 17 years. Before joining Deep Discount
Advisors, Mr. Clark served in various
managerial positions, and provided financial
services to banks, telecommunications
/software companies, private investors, and
regional developers. During this period, he
also served as CFO of a company in the
energy related business.
Number of Shares Owned
Directly or Indirectly
As of December 4, 1998 3,100
As previously noted, Deep Discount Advisors, Inc. and Ron Olin Investment
Management Company are deemed to own beneficially 2,031,150 shares of Common
Stock, representing 14.5 % of the shares outstanding on the Record Date.
Directors of the Fund who are not affiliated with Dresdner RCM Global Investors
LLC receive an annual stipend for serving on the Board and its committees, an
additional sum for each Board meeting which they attend and reimbursement for
out-of-pocket expenses in connection with their attendance at directors'
meetings. According to the Fund's Proxy statement, Directors not affiliated
with Dresdner each received total compensation between $10,500 and $11,250 for
the fiscal year ending December 31, 1997.
Other than fees that may be payable by the Fund to its directors, none of the
nominees named above has any arrangement or understanding with any person with
respect to any future employment by the Fund or by any affiliate of the Fund.
The persons named as proxies in the enclosed [GREEN] proxy
card intend, in the absence of contrary instructions, to vote all
proxies they are entitled to vote IN FAVOR of the election of the four
nominees named above. Each nominee has consented to stand for election
and to serve if elected. If any nominee is unable to serve, an event
not now anticipated, the proxies will be voted for such other person, if
any, as is designated by the persons named as proxies.
Information regarding the persons now serving as directors and
officers of the Fund, and additional information regarding the Fund, is
contained in the Fund's proxy statement.
STOCKHOLDER PROPOSALS
CONTRACT TERMINATION PROPOSAL
RESOLVED, The Fund's investment advisory agreement with its investment
advisor, Dresdner RCM Global Investors LLC ("Advisor"), shall be terminated and
the shareholders recommend that the board solicit competitive proposals for a
new investment advisor.
If this proposal is approved by stockholders, the Fund's investment advisory
agreement with Dresdner RCM Global Investors LLC will be required to be
terminated. We believe that Dresdner RCM Global Investors LLC has been the
primary impediment to allowing shareholders to receive full Net Asset Value
(NAV) if and when they desire to dispose of their shares. Although passage of
this proposal would not directly result in achieving this goal, it will
encourage the Board of Directors to seek a new investment adviser who is
committed to enhancing stockholder value.
In the event this proposal is approved by stockholders, it will be necessary for
the Board of Directors, including a majority of the directors who are not
"interested persons" (as defined by the 1940 Act) of the Fund, to approve an
investment advisory agreement with a new investment adviser to assure continuity
of services to the Fund. This new advisory agreement will also have to be
approved by stockholders of the Fund prior to its effectiveness. If a new
advisory agreement is not approved by stockholders and directors and implemented
prior to the effective date of the termination of the present investment
advisory agreement, it is possible that there will be a period of time during
which the Fund will not have an independent investment adviser responsible for
the management and supervision of its investment portfolio.
- --------------------------------------------------------------------------------
The Soliciting Shareholder intends to introduce at the meeting the following two
proposals originally submitted by other shareholders which the Fund has refused
to include in its proxy. The Soliciting Shareholder had nothing to do with
formulating these proposals and was not aware of them until the time frame in
which the Fund sought a "no action" letter from the SEC for excluding them.
RESOLUTION REMOVING CLASS II AND CLASS III DIRECTORS
RESOLVED, The Class II and Class III Directors of the Emerging Germany
Fund (the "Fund") are hereby removed.
The Fund's By-Laws provide for the removal of Directors with or without cause by
a majority of votes entitled to be cast for Directors. However, if this
resolution passes, and the Class II and Class III Directors refuse to be
removed, legal action may be necessary to enforce the vote of the shareholders.
Removal of the Class II and Class III directors will enable the Class I
directors, elected at the 1998 Annual Meeting of Stockholders, to have sole
responsibility for the consideration and determination of actions that should be
taken in seeking to enhance stockholder value. They would also have the ability
to seek additional, independent, qualified directors to serve on the Board.
If our nominees are elected as directors of the Fund and if the Class II and
Class III directors are removed, our nominees will constitute a majority of the
Board of Directors. If Messrs. Olin, Bradshaw, Bentz, and Clark comprise a
majority of the Board of Directors, they will have the ability to implement
measures they believe will enhance stockholder value and are in the best
interest of stockholders. Of course, no assurance can be given that any such
measures will be successful.
RESOLUTION RECOMMENDING REIMBURSEMENT OF LITIGATION COSTS
BY THE INVESTMENT ADVISOR
RESOLVED: That Fund shareholders believe costs associated with litigation
delaying the 1998 annual meeting were unnecessary, harmful to shareholder
interests, and a waste of corporate assets. As one reasonable remedy,
shareholders recommend that the Board in charge after the 1998 annual meeting
seek reimbursement, through legal means if necessary, from the investment
advisor and/or other responsible parties for the applicable legal and other
expenses charged to the Fund.
We have no comment other than to recommend that the shareholders vote "FOR" this
proposal.
PRINCIPAL HOLDERS OF VOTING SECURITIES
According to the Fund's proxy statement, as of December 11, 1998, the beneficial
owner's of more than 5% of the common Stock are: (i) Ron Olin Investment
Management Company and Deep Discount Advisers, Inc., both located at One West
Pack Square, Suite 777, Asheville, North Carolina 28801, together owned
approximately 14.5% of the outstanding Common Stock of the Fund; (ii)
Bankgesellschaft Berlin AG, Alexanderplatz 2, D-10178 Berlin, Germany, owned
approximately 20.9% of the outstanding Common Stock of the Fund; (iii) FMR
Corporation, 82 Devonshire Street, Boston, MA 02109 owned approximately 10.0%
of the outstanding Common Stock, (iv) Lazard Freres & Co. LLC, 30 Rockefeller
Plaza, New York, NY 10020 owned approximately 10.13% of the outstanding Common
Stock, and (v) no other person owned of record or, to the knowledge of the Fund,
beneficially owned more than 5% of the outstanding Common Stock. Mr. Olin and
Deep Discount Advisors, Inc. are defendants in litigation involving The Emerging
Germany Fund. See Exhibit 2.
According to the Fund's proxy statement , the directors and officers of the The
Emerging Germany Fund, as a group beneficially owned an aggregate of 5,136
shares of Common Stock, representing less than 0.5% of the outstanding shares.
THE SOLICITATION
Deep Discount Advisors, Inc. and Ron Olin Investment Management Company
(Soliciting Shareholder) are making this solicitation.
Banks, brokerage houses and other custodians, nominees and fiduciaries will be
requested to forward this proxy statement and the enclosed [GREEN] proxy card to
the beneficial owners of shares of Common Stock for whom they hold shares of
record. The Soliciting Shareholder will reimburse these organizations for their
reasonable out-of-pocket expenses.
The Soliciting Shareholder will bear all of the fees and expenses related to
this proxy solicitation except to the extent that it seeks and obtains
reimbursement. We intend to seek reimbursement of these expenses from
the Fund and will propose at the meeting that stockholders authorize and
direct such reimbursement at the meeting. We estimate that the total
amount of fees and expenses we will incur in soliciting proxies will not exceed
$50,000, of which none has been expended to date.
We are not and, within the past year, have not been a party to any contract,
arrangement or understanding with any person with respect to any securities of
the Fund. In addition, there is no arrangement or understanding involving
either the Soliciting Shareholder or any associate which relates to future
employment by the Fund or any future transaction with the Fund.
If you have any questions concerning this proxy solicitation or the procedures
to be followed to execute and deliver a proxy, please contact the Soliciting
Shareholder at 828-274-1863.
ADDITIONAL PROPOSALS
We know of no business that will be presented for consideration at the meeting
other than that set forth in this proxy statement and in the Fund's proxy
statement. If any other matters are properly presented for consideration at the
meeting, it is the intention of the persons named as proxies in the enclosed
[GREEN] proxy card to vote in accordance with their own best judgment on such
matters.
The date by which a stockholder must submit a proposal to be presented at the
1999 Annual Meeting of Stockholders is set forth in the Fund's proxy statement.
Dated: December ____, 1998
EXHIBIT 1
SECURITIES OF THE FUND PURCHASED OR SOLD
WITHIN THE PAST TWO YEARS BY THE SOLICITING STOCKHOLDER
Except as disclosed in this proxy statement, neither Ronald G. Olin nor Deep
Discount Advisors, Inc. nor Ron Olin Investment Management Company has, or had,
any interest, direct or indirect, by security holdings or otherwise, in the
Fund. The following table sets forth certain information with respect to
purchases and sales of shares of Common Stock of the Fund by Deep Discount
Advisors, Inc. and Ron Olin Investment Management Company for accounts holding
shares as to which they are deemed to be the beneficial owners (the "Accounts").
Some of the shares are held in margin accounts. Therefore, a portion of the
purchase price and market value of the shares may from time to time be
represented by margin borrowings, depending upon the net debit balances, if any,
of the margin accounts, which fluctuate daily.
Date Shares Purchased
12/2/96 1900
12/3/96 10600
12/12/96 14600
12/16/96 1600
12/17/96 12500
12/20/96 9500
1/8/97 6100
1/9/97 8600
1/10/97 1500
1/15/97 11500
1/17/97 18000
1/21/97 5300
1/22/97 31700
1/23/97 1600
1/24/97 8700
2/7/97 3100
2/12/97 8500
2/13/97 8000
2/25/97 10000
2/26/97 9500
3/4/97 5500
3/5/97 5100
3/6/97 5400
3/11/97 12500
3/12/97 30300
3/13/97 8500
3/14/97 1500
3/17/97 6500
3/18/97 1500
3/19/97 6500
3/20/97 1900
3/21/97 500
3/24/97 3000
3/27/97 10900
3/31/97 1700
4/1/97 6000
4/2/97 1600
4/3/97 4400
4/4/97 12000
4/8/97 5500
4/9/97 500
4/11/97 9500
4/16/97 6000
4/17/97 200
4/18/97 1500
4/21/97 4300
4/25/97 9300
4/30/97 1400
5/1/97 800
5/5/97 6000
5/6/97 12000
5/7/97 12000
5/9/97 7500
5/12/97 144100
5/13/97 39700
5/14/97 64100
5/15/97 3300
5/16/97 54700
5/19/97 125000
5/20/97 22100
5/21/97 3100
5/22/97 600
5/23/97 3700
5/27/97 8500
5/28/97 32500
5/29/97 8900
5/30/97 16100
6/2/97 50000
6/3/97 18600
6/4/97 13100
6/5/97 53900
6/6/97 24000
6/9/97 85200
6/10/97 800
6/11/97 11200
6/12/97 57300
6/13/97 6500
6/17/97 18500
6/18/97 11000
6/19/97 26500
6/20/97 35600
6/23/97 22600
6/24/97 10200
6/25/97 11900
6/26/97 18700
6/27/97 1500
6/30/97 400
7/8/97 13500
7/9/97 15000
7/10/97 26000
7/11/97 4100
7/14/97 6800
7/15/97 29800
7/16/97 27400
7/17/97 3900
7/18/97 22700
7/25/97 8000
7/28/97 3000
7/29/97 500
7/30/97 6000
7/31/97 17500
8/1/97 8000
8/6/97 10300
8/8/97 100
8/11/97 3000
8/12/97 54300
8/13/97 16200
8/14/97 2000
8/15/97 24200
8/19/97 9200
8/25/97 11700
8/26/97 22000
8/27/97 400
8/28/97 5000
8/29/97 9000
9/2/97 6000
9/3/97 4000
9/4/97 1500
9/5/97 1600
9/8/97 1100
9/10/97 13900
9/11/97 8000
9/12/97 1000
9/18/97 400
9/19/97 200
9/30/97 1100
10/1/97 2550
10/2/97 200
10/13/97 6600
10/16/97 10000
10/17/97 5900
10/20/97 5000
10/27/97 (205700)
11/7/97 1400
11/9/97 9000
11/10/97 2600
11/12/97 2000
11/13/97 6700
11/14/97 1400
11/26/97 8900
11/28/97 1800
12/4/97 1400
12/5/97 8000
12/8/97 2000
12/13/97 1000
12/18/97 21500
1/7/98 3700
1/14/98 2000
1/15/98 (400)
1/16/98 900
1/20/98 4500
2/3/98 3100
2/11/98 9100
2/17/98 2400
3/4/98 400
3/13/98 13000
3/17/98 62000
3/17/98 32000
3/17/98 14000
3/18/98 11000
4/2/98 (7900)
4/2/98 (7100)
4/6/98 (2800)
4/9/98 (400)
5/5/98 (1000)
5/29/98 (800)
6/11/98 (1900)
6/12/98 (3700)
6/16/98 (3600)
7/10/98 (800)
9/1/98 (31000)
EXHIBIT 2
PENDING LITIGATION INVOLVING THE SOLICITING STOCKHOLDER
The soliciting stockholder, and entities affiliated with him, are involved in
the following pending litigation relating to The Emerging Germany Fund. The
litigation is pending in U.S. District Court for the Southern District of New
York.
The Emerging Germany Fund Litigation
On April 8, 1998, the Fund filed a lawsuit against Phillip Goldstein,
Ronald Olin, and three entities affiliated with them. The action is captioned
THE EMERGING GERMANY FUND INC. V. GOLDSTEIN, 98 Civ. 2508 (DC) and is filed in
the United States District Court for the Southern District of New York. In its
complaint, the Fund alleges violations by the defendants of the proxy
solicitation and beneficial ownership disclosure provisions of U.S. federal
securities laws claims that the defendants used an Internet "chat room" and
other means to conduct an unlawful proxy solicitation in opposition to the
Fund's solicitation for the annual meeting scheduled for April 27, 1998. The
Fund seeks equitable relief against the defendants.
The Fund filed this action, immediately cancelled its 1998 annual meeting which
had been scheduled for April 27, 1998, and stated that it would not reschedule
the 1998 annual meeting until the litigation has been resolved.
Subsequently, a class action lawsuit was filed against the Fund by a stockholder
who demanded that the Fund reschedule its 1998 Annual Meeting. The Fund, as
nominal defendant, and each member of the Fund's Board of Directors, including
the four Class I members who are standing for re-election to the Board at the
Meeting, have been named as defendants in a derivative and purported class
action suit filed in the United States District Court for the Southern District
of New York. The matter is captioned STEINER V. FUGELSANG, 98 Civ. 3809 (DC)
(the "Steiner Litigation"), and was commenced on May 28, 1998. The class action
allegations in the Steiner Litigation assert that the defendants violated the
Investment Company Act of 1940 and Maryland Corporate Law by interfering with
the voting rights of Fund stockholders when they canceled the annual meeting
scheduled for April 27, 1998 and when they adopted an amendment to the Fund's
By-Laws which requires proposals intended to be made at stockholders' meetings
be provided to the Fund in advance of the meeting together with materially
relevant information. The derivative claims assert that the defendants breached
their fiduciary duties by amending the By-Laws as described above, by causing
the Fund to institute certain litigation described above, and by failing to take
all steps necessary to maximize stockholder value. Plaintiff seeks equitable
relief on the class claims and damages on the derivative claims.
The Fund's Directors believe that they acted appropriately in these matters, and
they intend to defend the two actions vigorously. Under the Fund's chartering
documents and under a policy of insurance, the Directors are entitled to
indemnification and to advancement of the costs of defense in certain
circumstances. Consistent with state and federal law and the terms of the
insurance policy, the Fund will indemnify the Directors and advance the costs of
their defense to these actions.
Subsequent to these events, the Fund rescheduled its 1998 Annual Meeting for
January 26, 1999 and announced that it would recommend open-ending the Fund.
Ronald Olin and Deep Discount Advisors, Inc., of which Ronald Olin is President
and Chief Executive Officer, and the other defendants in the litigation filed by
the Fund have moved for dismissal of all charges and believe that the Fund's
lawsuit and claims against them are completely without merit. Those motions are
currently pending.
* * *
All of the above actions were filed in the Federal District Court , S.D.N.Y.
Copies of all pleadings in the above actions are available upon request.
EXHIBIT 3
DEEP DISCOUNT ADVISORS INC.
Enhanced Performance through Closed-End Fund Investments
One West Pack Square, Suite 777, Asheville, NC 28801
828-274-1863 Fax: 828-255-4834 E-mail: [email protected]
Robert J. Goldstein, Secretary Ph: 415-954-5409 Fax: 415-954-5420
The Board of Directors, The Emerging Germany Fund, Inc.
Dresdner RCM Global Investors LLC
Four Embarcadero Center
San Francisco, California 94111
(via both Fax and Federal Express) July 14, 1998
To the Board of Directors of The Emerging Germany Fund:
I am scheduled to meet with a committee of the Board on July 21, 1998. The
purpose of this letter is to provide some background to the Board in advance of
that meeting and to suggest some remedies for both the discount and performance
problems which are the source of contention between the Fund and many of its
shareholders. I am hopeful that advance consideration of this material will
make our meeting very productive.
My clients and I currently own about 15% of the Emerging Germany Fund and have
held most of the shares for a long time. We have been disappointed by the long-
term performance of the Fund and the persistent discount at which the Fund's
shares have traded. We feel that there is no need to tolerate such a discount,
as adequate remedies exist that are beneficial to all shareholders.
A DISAPPOINTING LONG-TERM INVESTMENT
All of the shareholder reports since the inception of the Fund are the basis of
the following synopsis of the "out of pocket" investment results of the Fund's
owners:
EMERGING GERMANY FUND SHAREHOLDER RESULTS
(Values in Thousands - Source: Data from Regular Shareholder Reports)
All Total Total Distr. Monthly
Period Shares Offer Share Mgmt. Director Oper. Paid Index Index
Ending Issued Fees Cost Fees Costs Expense Out Value Units
- --------------------------------------------------------------------------------
4/05/90 14,008 13,253 168,100 1,280 +131.4
12/31/90 1,021 46 1,668 2,802 1,131 -2.5
12/31/91 1,212 74 2,145 3,222 1,230 -2.6
12/31/92 1,180 73 1,828 1,541 1,110 -1.4
12/31/93 1,160 74 1,752 1,681 1,514 -1.1
12/31/94 1,278 78 1,887 1,681 1,591 -1.1
12/31/95 1,244 77 1,970 1,861
12/31/96 1,298 70 1,947 280 2,124 -0.1
12/31/97 1,556 95 2,199 10,927 2,656 -4.1
3/31/98 3,109
TOTALS 14,008 13,253 168,100 9,949 586 15,396 22,133 118.5
MSCI Germany Total 3/31/98 Per Total Results Fund Index
Return Index (US$)** Values Share Value Comparison Shares Units
- ------------------------ ---------------------- ----------------------------
Index Units from Market
Same Cash Flow 118.5 Price: 13.31 186,486 Market Value 186,486 368,270
Times 3/31/98 Net Asset + Payouts 22,133 22,133
Index Value 3,109 Value: 15.24 213,461 - Share Cost 168,100 168,100
Shareholder Value Discount
w/ Index Units 368,270 Loss: 1.93 26,975 Net Gain: 40,519 222,303
WHO GOT WHAT IN THE EMERGING GERMANY FUND?
(April 1990 - March 1998)
- --------------------------------------------------------------------------------
Net Gain to Shareholders $ 41 Mil. xxxxxxx
Total Fees & Expenses $ 29 Mil. xxxxx
Shareholder Loss to Discount $ 27 Mil. xxxxx
Gain to the German Index** $222 Mil. xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
**Note: The MSCI German Total Return Index is a standard measure of the returns
of capitalization weighted German equities. Index results may be affected
because the index is not subject to the same investment policies and
restrictions as the Fund. Also, the index is computed on a month-end basis
only, so applying the Fund cash flows during each fiscal year to year-end and
month-end index values is only an approximation of alternative results.
SYNOPSIS OF SHAREHOLDER INVESTMENT RESULTS
This has been a disappointing long-term investment. Since inception on 4/5/90,
the Fund's shareholders have paid $168 million to buy new shares, received $22
million in distributions, and had an investment with a market value of $186
million as of the Fund's last report dated 3/31/98.
The shareholders paid out $29 million in advisory fees, director fees,
underwriting fees, and other expenses while making only about $41 million on
their investment. As of 3/31/98, the discount was costing each and every
shareholder $1.93 a share or about +15% extra return. The $27 million lost to
the discount is almost two thirds as much as the entire $41 million the
shareholders have collectively managed to realize on their investment since
inception of the Fund eight years ago.
The Net Asset Value (NAV) performance of the Fund is somewhat better, but it
fails to reflect the devastating impact of the discount on shareholder
investment results.
REMEDIES TO REDUCE THE DISCOUNT & ENHANCE SHAREHOLDER RETURNS
The discount represents an opportunity to markedly improve shareholder
investment results with this Fund. All that is required is that Dresdner and
the Board take the actions necessary to enhance shareholder wealth through the
reduction and eventual elimination of the discount. Remedies are available
which would enhance the Net Asset Value (NAV) of the Fund's shares,
reduce/eliminate the discount, and allow shareholders a choice between a closed-
end structure and receiving NAV for all their shares. The only significant
impact of such actions would be a reduction in the advisory fee income paid to
Dresdner due to those shareholders who choose to cash out entirely.
Transactions can be structured so that there will be no resulting tax impact on
those shareholders choosing to remain in the closed-end structure.
REMEDY #1 - PERPETUAL SHARE BUYBACKS TO ENHANCE NAV & REDUCE DISCOUNTS
Share buybacks have been viewed by the industry as a failure because, even
though they have always enhanced NAV, they have never permanently fixed the
discount. This is not surprising because all repurchase plans have been limited
in size and duration. You don't get a permanent fix with a temporary band-aid.
Instead, if a fund unequivocally committed to perpetual, maximum buybacks
whenever a discount existed, there would always be a buyer for the Fund's
shares. Potential sellers would learn to be patient and it would lower the
discount at which they were willing to sell. Every share that the Fund bought
at a discount would enhance NAV and the performance of the Fund. This would
attract other buyers and serve to rebalance the demand/supply equation at a
lower discount level. Logic suggests that eventually the price would stabilize
in a range somewhere near NAV.
The value of such a program to existing shareholders is significant. For
example, suppose repurchases began at a 13% discount (similar to that of The
Emerging Germany Fund), suppose it took one half of the Fund's assets and one
year to reduce the discount to 0%, suppose the average purchase price were at a
7% discount, and further suppose that the Fund's portfolio securities
appreciated 10% during the same year net of expenses. In this case, those
shareholders sticking with the Fund would see their investment increase by about
+32% (+15% from discount elimination, +7% from NAV enhancement, +10% from the
portfolio increase).
Repurchasing shares at a discount is equivalent to buying the fund's own
carefully chosen portfolio at prices cheaper than those available in the market.
The turnover of the Emerging Germany Fund has ranged from 40% to 98% in recent
years. What could be a better investment for the Fund?
Seventy per cent of the Fund's yearly expenses are advisory fees which are
proportional to the size of the Fund. A reduction in Fund size by one half
might increase the Fund's expense ratio from about 1.3% to about 1.7%. Most
shareholders would gladly make this tradeoff to eliminate the discount and
enhance their wealth.
REMEDY #2 - SPLITTING UP THE FUND TO SATISFY ALL SHAREHOLDERS
Many shareholders feel that they should be entitled to receive full NAV for
their shares right away and should not have to wait for perpetual share buybacks
or other techniques to slowly eliminate the discount. They desire that the Fund
be open-ended. Fund Advisors and Boards often object that this is not fair to
shareholders who like the closed-end structure. They argue that open-ending
will create tax consequences and costs due to massive redemptions when other
shareholders cash out.
There is a solution which should satisfy all shareholders. The Fund could do a
self-tender offer for its shares in exchange for an in-kind distribution of its
portfolio. Those wishing to remain in the closed-end fund would not have any
tax consequences as a result.
The tendering shareholders could be given a further option to exchange their
portfolio proceeds for shares of a newly formed open-end fund created for that
purpose or alternatively a liquidating trust which would sell them out. The
entire series of transactions could be structured so that all expenses and tax
impacts would be borne only by the those shareholders who chose to tender.
A somewhat similar action has already been proposed by another closed-end fund
organization. In that case, complications have been introduced by a decision to
first orchestrate a merger between two different closed-end funds. The merger
results in restrictions as to the sizes of the resulting open and closed-end
entities which limits the tender offer. I believe such restrictions would not
exist in the case of the Emerging Germany Fund. Never-the-less, the groundwork
has already been laid for a technique which could satisfy all shareholders.
A further advantage of this approach is that it would remove from the market the
large number of the Fund's shareholders who are currently willing to sell their
shares at less than NAV, and leave only those shareholders who truly desire the
closed-end format in the remaining closed-end fund.
The optimal solution for the Emerging Germany Fund might be a combination of the
two remedies: First, allowing those who wished NAV to exit to an open-end
counterpart, and then instituting a perpetual buyback program in the remaining
closed-end fund to keep the discount from reappearing.
THE MEETING WITH THE COMMITTEE OF THE BOARD
I am looking forward to a productive discussion with the committee of the Board.
In my opinion, there should be no need for contention, confrontation, and
expensive legal entanglements between the shareholders and their fiduciaries.
Let us work together productively to solve the discount and performance problems
of the Fund in a way which maximizes the benefit to all shareholders. Together,
I am sure we can figure out options to satisfy the different needs of both those
shareholders who prefer the closed-end structure and those who desire NAV for
their shares.
Very truly yours,
Ronald G. Olin
President, Deep Discount Advisors
EXHIBIT 4
Robert J. Goldstein, Secretary Ph: 415-954-5409 Fax: 415-954-5420
The Board of Directors, The Emerging Germany Fund, Inc.
Dresdner RCM Global Investors LLC
Four Embarcadero Center
San Francisco, California 94111
(via both Fax and Federal Express) November 6, 1998
Dear Mr. Goldstein:
Deep Discount Advisors, Inc. and Ron Olin Investment Management Company are the
beneficial holders of 2,031,150 shares of the common stock, par value $.01 per
share (the "Common Stock"), of The Emerging Germany Fund, Inc. (the "Fund"),
representing approximately 14.5% of the outstanding shares of Common Stock as of
November 6, 1998. We understand that the 1998 Annual Meeting of Stockholders,
originally scheduled for April 27, 1998 and subsequently cancelled by the Board
of Directors, has been rescheduled for January 26, 1999. According to the
Fund's Proxy Statement, dated March 16, 1998, for the 1998 Annual Meeting of
Stockholders, four Class I Directors are up for election for a term of three
years from 1999 to 2001 at the next annual stockholders meeting. These Class
I positions are currently held by Theodore J. Coburn, Robert J. Birnbaum,
Carroll Brown, and George N. Fugelsang.
The purpose of this letter is to request that the Board of Directors, or
Nominating Committee as appropriate, nominate Ronald G. Olin, Ralph W. Bradshaw,
Gary A. Bentz, and William A. Clark for election to the Board to fill the four
Directors positions that are due for consideration at the next annual meeting.
Brief biographies of Messrs. Olin, Bradshaw, Bentz, and Clark are attached as
Attachment 1. They have indicated that they are willing to serve, if elected,
and they are prepared to provide any other information in order to verify that
they are in compliance with all requirements, applicable to directors, of the
Investment Company Act of 1940, as amended, and the Fund's articles of
incorporation and by-laws. All four gentlemen have extensive experience in
closed-end fund analysis and evaluation, investment consulting, and related
private portfolio management.
As representatives of longtime stockholders of The Emerging Germany Fund, we
have been deeply concerned about the persistent discount from net asset value
("NAV") at which the Fund's shares trade on the open market. We believe that
other stockholders of The Emerging Germany Fund must share this concern.
Messrs. Olin, Bradshaw, Bentz, and Clark represent substantial stockholder
interests in The Emerging Germany Fund, and, if elected to the Board, they would
be dedicated to exploring methods of enhancing stockholder returns in a variety
of ways, one of which would be the active management of the discount problem.
Such methods might include, but are not limited to, the structured purchase of
shares in the market by the Fund, which would have the effect of increasing NAV
and reducing the discount, and the evaluation of several different ways of
delivering NAV to those stockholders who desire it, while minimizing the effects
on those stockholders who want to keep the closed-end structure and its related
benefits.
We believe that the Board, based on its current composition, has not been
sufficiently responsive to the concerns of stockholders whose investment returns
have suffered unnecessarily because of the persistent discount to NAV. The
nomination and election of Messrs. Olin, Bradshaw, Bentz, and Clark will provide
a greater degree of independence in evaluating methods of managing the discount
structure pro-actively. Moreover, they will provide a fresh perspective for all
Board decisions, a perspective which is more representative of shareholder
interests rather than the interests of the Fund's investment manager.
As Board members, if elected, the primary objective of Messrs. Olin, Bradshaw,
Bentz, and Clark will be to enhance shareholder value.
In the event that the Board, or Nominating Committee, does not wish to nominate
Messrs. Olin, Bradshaw, Bentz, and Clark in lieu of the incumbent Directors, we
request that you at least offer the stockholders a choice in order achieve a
true measure of stockholder sentiment with regard to major stockholder
representation on the Board. Accordingly, we request that the Board offer two
slates of Director nominees on its proxy, one of which would be the primary
nominees of the Board, and the other of which would include Messrs. Olin,
Bradshaw, Bentz, and Clark, or in the event you do not want to include any or
all of them, an alternate slate of Directors representative of any of the
several major stockholders of the Fund.
In any case, we, as representatives of long term investors in the Fund, would
appreciate the opportunity to register our support for other non-incumbent
nominees with substantial stockholder interests who would provide the degree of
objectivity and true shareholder representation that we think the Board of The
Emerging Germany Fund needs at this time.
We thank you and the Board of Directors for your attention, and we would be
happy to discuss this request in more detail at your convenience. In view of
the schedule for the upcoming meeting, we respectfully request a response to our
proposal in writing by November 18, 1998.
Very truly yours,
Gary A. Bentz
Chief Financial Officer
Attch
ATTACHMENT 1
Ronald G. Olin
U.S. Citizen
Age: 53
B.A., Electrical Engineering, 1967, Rice University
M.S., Electrical Engineering, 1968, Rice University
Mr. Olin is President and Chief Executive Officer of Deep Discount Advisors,
Inc. and General Partner of Ron Olin Investment Management Co. Both firms are
registered investment advisors specializing in investments in closed-end funds.
Prior to founding these investment management firms, Mr. Olin was a senior
manager with IBM supporting government software contracts with the N.A.S.A. and
D.O.D. Mr. Olin currently serves as a Director on other public and private
Boards, including a domestically traded closed-end fund with an internationally
diversified portfolio.
Ralph W. Bradshaw
U.S. Citizen
Age: 47
B.S. Chemical Engineering, 1973, Texas A & M University
M.B.A., 1977, Oklahoma State University
Mr. Bradshaw has served as Vice President and Secretary of Deep Discount
Advisors, Inc., a registered investment advisor specializing in closed-end fund
investments, for over five years. During that period he has also provided
financial consulting services in the area of closed-end funds. In previous
years, he has held various managerial positions. Mr. Bradshaw currently serves
as a Director on other public and private Boards, including a domestically
traded closed-end fund with an internationally diversified portfolio.
Gary A. Bentz
U.S. Citizen
Age: 42
B.S. Business and Finance, 1978, Trinity University, San Antonio
Certified Public Accountant, 1986
Mr. Bentz has served as Vice President and Chief Financial Officer of Deep
Discount Advisors, Inc., a registered investment advisor specializing in
closed-end fund investments, for over five years. He has also provided
financial accounting, investment analysis and consulting services to companies
and private investors for the last 13 years. After commencing his career with
Arthur Andersen & Co., Mr. Bentz held various financial managerial positions in
industry. He currently serves as a Director on the Board of a domestically
traded closed-end fund with an internationally diversified portfolio.
William A. Clark
U.S. Citizen
Age: 53
B.A., 1967, University of Texas, Austin
M.B.A., Finance 1980, Southern Methodist University, Dallas
Since 1995 Mr. Clark has served as Director of Research for Deep Discount
Advisors, Inc., a registered investment advisor specializing in closed-end fund
investment, in addition to providing consulting services in closed-end fund
portfolio management. Mr. Clark has served as an investment analyst and advisor
to private clients for over 17 years. Before joining Deep Discount Advisors Mr.
Clark served in various managerial positions, and provided financial services to
banks, telecommunications/software companies, private investors, and regional
developers. During this period, he also served as CFO of a company in the
energy related business.
PROXY CARD
PROXY SOLICITED IN OPPOSITION TO
THE BOARD OF DIRECTORS OF
THE EMERGING GERMANY FUND, INC.
BY
DEEP DISCOUNT ADVISORS, INC.
AND RON OLIN INVESTMENT MANAGEMENT COMPANY
ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON JANUARY 26, 1999
The undersigned hereby appoints Ronald G. Olin, Ralph W. Bradshaw, Gary A.
Bentz, and William A. Clark, and each of them, as the undersigned's proxies,
with full power of substitution, to attend the Annual Meeting of Stockholders of
The Emerging Germany Fund, Inc. (the "Fund") to be held on January 26, 1999, at
75 Wall Street (Lower Level), New York, New York 10005 at 10:00 a.m., New York
time, (the "Meeting"), and any adjournment(s) or postponement(s) thereof, and to
vote on all matters that may come before the Meeting and any such adjournment or
postponement 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
specified below. The proxies may vote in their discretion with respect to such
other matter or matters as may come before the Meeting and with respect to all
matters incident to the conduct of the Meeting.
(INSTRUCTIONS: Mark votes by placing an "x" in the appropriate [ ].)
1(a) Expansion of the Fund's investment objective from a
predominantly German investment portfolio to a broader
European investment portfolio, ("Conversion to European Fund').
FOR [ ] AGAINST [ ] ABSTAIN [ ]
THE SOLICITING SHAREHOLDER URGES YOU TO VOTE "FOR" PROPOSAL 1(a)
1.b Amendment of the Fund's Articles of Incorporation to change
the Fund's name to Dresdner RCM Europe Fund, Inc.
FOR [ ] AGAINST [ ] ABSTAIN [ ]
IF PROPOSAL 1(b) IS LEFT BLANK FOR ALL BOXES, THE SOLICITING SHAREHOLDER
WILL VOTE ON THIS PROPOSAL IN THE BEST INTERESTS OF THE STOCKHOLDERS AT
THE TIME OF THE ANNUAL MEETING, BASED ON THE SOLE JUDGEMENT OF THE
SOLICITING SHAREHOLDER
2(a) Conversion of the Fund from a closed-end investment
company to an open-end investment company under the 1940
Act and the amendment and restatement of the Fund's Articles
of Incorporation.
FOR [ ] AGAINST [ ] ABSTAIN [ ]
2(b) Modification and elimination of certain of the Fund's
fundamental investment restrictions.
FOR [ ] AGAINST [ ] ABSTAIN [ ]
2(c) Approval or disapproval of the Investment Management Agreement.
FOR [ ] AGAINST [ ] ABSTAIN [ ]
2(d) Approval or disapproval of the Rule 12B-1 Distribution Plan.
FOR [ ] AGAINST [ ] ABSTAIN [ ]
IF PROPOSALs 2(a), 2(b), 2(c), AND 2(d) ARE LEFT BLANK FOR ALL BOXES, THE
SOLICITING SHAREHOLDER WILL VOTE ON THIS PROPOSAL IN THE BEST INTERESTS
OF THE STOCKHOLDERS AT THE TIME OF THE ANNUAL MEETING, BASED ON
THE SOLE JUDGEMENT OF THE SOLICITING SHAREHOLDER
3. ELECTION OF DIRECTORS.
Class I Directors (term expires in 2001)
FOR ALL NOMINEES [ ] WITHHOLD [ ] FOR ALL EXCEPT [ ]
RONALD G. OLIN
RALPH W. BRADSHAW
GARY A. BENTZ
WILLIAM A. CLARK
NOTE: IF YOU DO NOT WISH YOUR SHARES VOTED "FOR" ANY PARTICULAR NOMINEE,
MARK THE "FOR ALL EXCEPT" BOX AND STRIKE A LINE THROUGH THE NAME(S) OF THE
NOMINEE(S). YOUR SHARES WILL BE VOTED FOR THE REMAINING NOMINEE(S).
THE SOLICITING SHAREHOLDER URGES YOU TO VOTE "FOR" THE ELECTION OF ALL
NOMINEES
4. To ratify the selection by the Board of Directors of
PricewaterhouseCoopers LLP as the Fund's independent accountants
for the year ending December 31, 1999:
FOR [ ] AGAINST [ ] ABSTAIN [ ]
5. Stockholder proposal to terminate the investment advisory
agreement between the Fund and Dresdner RCM Global Investors LLC.
FOR [ ] AGAINST [ ] ABSTAIN [ ]
IF PROPOSAL FIVE (5) IS LEFT BLANK FOR ALL BOXES, THE SOLICITING
SHAREHOLDER WILL VOTE ON THIS PROPOSAL IN THE BEST INTERESTS
OF THE STOCKHOLDERS AT THE TIME OF THE ANNUAL MEETING, BASED ON
THE SOLE JUDGEMENT OF THE SOLICITING SHAREHOLDER
6. Stockholder proposal requiring the removal of Class II and
Class III directors from the Board.
FOR [ ] AGAINST [ ] ABSTAIN [ ]
THE SOLICITING SHAREHOLDER URGES YOU TO VOTE "FOR" PROPOSAL SIX
7. Stockholder proposal recommending that the Board seek reimbursement,
through legal means if necessary, from the investment advisor and/or
other responsible parties for the applicable legal fees and other
expenses charged to the fund pursuant to litigation against its own
shareholders.
FOR [ ] AGAINST [ ] ABSTAIN [ ]
THE SOLICITING SHAREHOLDER URGES YOU TO VOTE "FOR" PROPOSAL SEVEN
IMPORTANT - - PLEASE SIGN AND DATE BELOW AS INDICATED.
SHARES WILL BE VOTED AS DIRECTED. IF NO DIRECTION IS MADE, THIS PROXY
WILL BE VOTED IN FAVOR OF THE ELECTION OF ALL NOMINEES NAMED ABOVE IN
ITEM 3 AND "FOR" PROPOSALS 1(a), 6, AND 7 AND WILL ABSTAIN FROM VOTING ON
PROPOSAL 4. ALL OTHER PROPOSALS WILL BE VOTED BY THE SOLICITING SHAREHOLDER IN
THE BEST INTERESTS OF STOCKHOLDERS AS DETERMINED BY THE SOLE JUDGEMENT OF THE
SOLICITING SHAREHOLDER AT THE TIME OF THE MEETING. THE UNDERSIGNED HEREBY
ACKNOWLEDGES RECEIPT OF THE PROXY STATEMENT DATED DECEMBER ___, 1998, OF DEEP
DISCOUNT ADVISORS, INC. AND RON OLIN INVESTMENT MANAGEMENT COMPANY. 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 Deep Discount Advisors, Inc. and Ron Olin
Investment Management Company, both beneficial shareholders 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.
