<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934
Filed by the Registrant /X/
Filed by a Party other than the Registrant / /
Check the appropriate box:
/ / Preliminary Proxy Statement
/ / Confidential, for Use of the Commission Only (as permitted by
Rule 14a-6(e)(2))
/X/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Section240.14a-11(c) or
Section240.14a-12
THE JAPAN EQUITY FUND, INC.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------------------
(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)(1) 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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<PAGE>
THE JAPAN EQUITY FUND, INC.
C/O DAIWA SECURITIES TRUST COMPANY
ONE EVERTRUST PLAZA
JERSEY CITY, NEW JERSEY 07302
(201) 333-7300
February 11, 2000
Dear Stockholders:
The Annual Meeting of Stockholders of The Japan Equity Fund, Inc. (the
"Fund") will be held at 10:00 a.m., New York time, on Thursday, March 16, 2000,
at the offices of Daiwa Securities America Inc., Financial Square, 32 Old Slip,
14th Floor, New York, New York 10005. A Notice and Proxy Statement regarding the
Meeting, a proxy card for your vote at the Meeting, and a postage prepaid
envelope in which to return your proxy are enclosed.
At the Annual Meeting, the stockholders will (i) elect two Class I
directors; (ii) consider the ratification of the selection of
PricewaterhouseCoopers LLP as independent accountants; (iii) consider whether to
approve a change in the Fund's investment objective to: to outperform over the
long term, on a total return basis (including appreciation and dividends), the
Tokyo Stock Price Index ("TOPIX"); and (iv) consider the approval of a new
Investment Advisory Agreement between Daiwa SB Investments (USA) Ltd. and Daiwa
SB Investments Ltd. In addition, the stockholders who will be present at the
Annual Meeting will hear an investment report on the Fund and will have an
opportunity to discuss matters of interest to them.
If you will not be able to attend the Annual Meeting in person, please take
the time now to review the enclosed materials and vote your shares by proxy.
YOUR VOTE IS IMPORTANT.
The Board has recommended that the stockholders vote in favor of each of the
foregoing matters.
Respectfully,
/s/ HIDEAKI MATSUURA
--------------------
Hideaki Matsuura
CHAIRMAN OF THE BOARD
STOCKHOLDERS ARE STRONGLY URGED TO PROMPTLY SIGN AND MAIL THE ACCOMPANYING PROXY
IN THE ENCLOSED RETURN ENVELOPE TO ENSURE A QUORUM AT THE MEETING.
YOUR VOTE IS IMPORTANT.
<PAGE>
THE JAPAN EQUITY FUND, INC.
----------
NOTICE OF THE ANNUAL MEETING OF STOCKHOLDERS
MARCH 16, 2000
------------------------
To the Stockholders of
The Japan Equity Fund, Inc.:
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders of The Japan
Equity Fund, Inc. (the "Fund") will be held at the offices of Daiwa Securities
America Inc., Financial Square, 32 Old Slip, 14th Floor, New York, New York
10005, on Thursday, March 16, 2000, at 10:00 a.m., New York time, for the
following purposes:
1. To elect two Class I directors to serve for a term expiring on the date
on which the Annual Meeting of Stockholders is held in the year 2003.
2. To ratify or reject the selection of PricewaterhouseCoopers LLP as
independent accountants of the Fund for its fiscal year ending
October 31, 2000.
3. To approve or disapprove a change in the Fund's investment objective to:
to outperform over the long term, on a total return basis (including
appreciation and dividends), the TOPIX.
4. To approve or reject a new Investment Advisory Agreement between Daiwa
SB Investments (USA) Ltd., as investment manager of the Fund, and Daiwa
SB Investments Ltd., as investment adviser of the Fund.
5. To transact such other business as may properly come before the Meeting
or any adjournments thereof.
The Board of Directors has fixed the close of business on January 10, 2000
as the record date for the determination of stockholders entitled to notice of
and to vote at the Meeting or any adjournments thereof.
You are cordially invited to attend the Meeting. Stockholders who do not
expect to attend the Meeting in person are requested to complete, date and sign
the enclosed form of proxy and return it promptly in the envelope provided for
that purpose. You may nevertheless vote in person at the Meeting if you choose
to attend. Your vote is important. The enclosed proxy is being solicited by the
Board of Directors of the Fund.
By order of the Board of Directors,
Judy Runrun Tu
ASSISTANT SECRETARY
February 11, 2000
<PAGE>
THE JAPAN EQUITY FUND, INC.
----------
PROXY STATEMENT
------------------------
INTRODUCTION
This Proxy Statement is furnished in connection with the solicitation of
proxies by the Board of Directors of THE JAPAN EQUITY FUND, INC. (the "Fund")
for use at the Annual Meeting of Stockholders, to be held at the offices of
Daiwa Securities America Inc., Financial Square, 32 Old Slip, 14th Floor, New
York, New York 10005, on Thursday, March 16, 2000, at 10:00 a.m., New York time,
and at any adjournments thereof.
This Proxy Statement and the form of proxy are being mailed to stockholders
on or about February 11, 2000. Any stockholder giving a proxy in advance of the
Annual Meeting has the power to revoke it by mail (addressed to the Assistant
Secretary, The Japan Equity Fund, Inc., c/o Daiwa Securities Trust Company, One
Evertrust Plaza, 9th Floor, Jersey City, New Jersey 07302) or in person at the
Meeting, by executing a superseding proxy or by submitting a notice of
revocation to the Fund. All properly executed proxies received in time for the
Meeting will be voted as specified in the proxy or, if no specification is made,
for each proposal referred to in this Proxy Statement. Abstentions and broker
non-votes are each included in the determination of the number of shares present
at the Meeting.
THE FUND WILL FURNISH, WITHOUT CHARGE, A COPY OF ITS ANNUAL REPORT FOR ITS
FISCAL YEAR ENDED OCTOBER 31, 1999 TO ANY STOCKHOLDER REQUESTING SUCH REPORT.
REQUESTS FOR THE ANNUAL REPORT SHOULD BE MADE BY WRITING TO THE JAPAN EQUITY
FUND, INC., C/O DAIWA SECURITIES TRUST COMPANY, ONE EVERTRUST PLAZA, 9TH FLOOR,
JERSEY CITY, NEW JERSEY 07302, ATTENTION: SHAREHOLDER RELATIONS OR BY CALLING
(201) 333-7300.
The Board of Directors has fixed the close of business on January 10, 2000
as the record date for the determination of stockholders entitled to notice of
and to vote at the Meeting and at any adjournments thereof. Stockholders on the
record date will be entitled to one vote for each share held, with no shares
having cumulative voting rights. As of the record date, the Fund had outstanding
10,815,688 shares of common stock. To the knowledge of the Fund's management, no
person owned beneficially more than 5% of the Fund's outstanding shares as of
January 10, 2000.
Management of the Fund knows of no business other than that mentioned in
Items 1 through 4 of the Notice of Meeting which will be presented for
consideration at the Meeting. If any other matter is properly presented, it is
the intention of the persons named in the enclosed proxy to vote in accordance
with their best judgment.
THE BOARD RECOMMENDS THAT THE STOCKHOLDERS VOTE IN FAVOR OF EACH OF THE
MATTERS MENTIONED IN ITEMS 1 THROUGH 4 OF THE NOTICE OF MEETING.
1
<PAGE>
(1) ELECTION OF DIRECTORS
Persons named in the accompanying form of proxy intend in the absence of
contrary instructions to vote all proxies for the election of the two nominees
listed below as directors of the Fund:
CLASS I
---------------------------
Martin J. Gruber
Hideaki Matsuura
to serve for terms expiring on the date of subsequent Annual Meetings of
Stockholders in the year 2003, or until their successors are elected and
qualified. If any such nominee should be unable to serve, an event that is not
now anticipated, the proxies will be voted for such person, if any, as shall be
designated by the Board of Directors to replace any such nominee. The election
of each director will require the affirmative vote of a majority of the votes
cast at the Meeting. For this purpose, abstentions and broker nonvotes will not
be counted as votes cast at the Meeting.
INFORMATION CONCERNING NOMINEES AND DIRECTORS
The following table sets forth information concerning each of the nominees
as a director of the Fund, as well as the other current directors of the Fund.
Each of the nominees is now a director of the Fund and has consented to be named
in this Proxy Statement and to serve as a director of the Fund if elected.
<TABLE>
<CAPTION>
PRESENT OFFICE WITH THE FUND, IF ANY, SHARES
PRINCIPAL OCCUPATION BENEFICIALLY
OR EMPLOYMENT DURING PAST OWNED
FIVE YEARS AND JANUARY PERCENT
NAME (AGE) AND ADDRESS DIRECTORSHIPS IN DIRECTOR 10, OF
OF NOMINEES/DIRECTORS PUBLICLY HELD COMPANIES SINCE 2000(+) CLASS
- -------------------------------- -------------------------------------- -------- ------------ -------
<S> <C> <C> <C> <C> <C>
NOMINEES
Martin J. Gruber (62) Professor of Finance, Leonard N. Stern 1992 5,321 **
229 South Irving Street School of Business, New York
Ridgewood, NJ University, since 1965; Director, SG
07450 Cowen Income & Growth Fund, Inc.,
since 1986; Director, SG Cowen
Opportunity Fund, since 1987;
Director, SG Cowen Standby Reserve
Fund Inc., since 1985; Director, SG
Cowen Standby Tax Exempt Reserve Fund
Inc., since 1986; Trustee, BT Pyramid
Fund, since 1992; Trustee, BT
Leadership Trust, since 1993;
Director, The Taiwan Equity
Fund, Inc., since 1994; Trustee,
T.I.A.A., since 1996.
</TABLE>
2
<PAGE>
<TABLE>
<CAPTION>
PRESENT OFFICE WITH THE FUND, IF ANY, SHARES
PRINCIPAL OCCUPATION BENEFICIALLY
OR EMPLOYMENT DURING PAST OWNED
FIVE YEARS AND JANUARY PERCENT
NAME (AGE) AND ADDRESS DIRECTORSHIPS IN DIRECTOR 10, OF
OF NOMINEES/DIRECTORS PUBLICLY HELD COMPANIES SINCE 2000(+) CLASS
- -------------------------------- -------------------------------------- -------- ------------ -------
<S> <C> <C> <C> <C> <C>
* Hideaki Matsuura (51) Chairman of the Board and Acting 1997 None --
One Evertrust Plaza President of the Fund; President and
Jersey City, NJ Chairman, Daiwa Securities Trust
07302 Company, since July 1997; Director,
Daiwa Securities (H.K.) Ltd., from
September 1995 to June 1997; General
Manager, Daiwa Securities Co. Ltd.,
from August 1994 to August 1995;
Executive Vice President, Daiwa
Securities America, Inc., from April
1988 to August 1994.
OTHER CURRENT DIRECTORS
Austin C. Dowling (67) Director, The Thai Capital 1992 2,046 **
1002 E Long Beach Boulevard Fund, Inc., since 1990.
North Beach, NJ
08008
* Harry M. Markowitz (72) President of Harry Markowitz Company 1992 1,779 **
1010 Turquoise Street since 1984; President of the Fund,
Suite 245 from 1992 to 1999; Director of
San Diego, CA Research, Global Portfolio Research
92109 Department, Daiwa Securities Trust
Company, from 1990 to 1999; Marvin
Speiser Distinguished Professor of
Finance and Economics, Baruch College,
City University of New York, from 1982
to 1993; Director, Health Chem
Corporation from 1993 to 1994.
Robert F. Gurnee (72) Chairman and Chief Executive Officer, 1992 1,156 **
102 Santomera Lane Financial Integrity Group Inc. (bank
Greenville, DE and financial services consulting
19807 firm), since 1990; Director, Vestaur
Securities Co., since 1991; Director,
The Thai Capital Fund, Inc., since
1990.
</TABLE>
3
<PAGE>
<TABLE>
<CAPTION>
PRESENT OFFICE WITH THE FUND, IF ANY, SHARES
PRINCIPAL OCCUPATION BENEFICIALLY
OR EMPLOYMENT DURING PAST OWNED
FIVE YEARS AND JANUARY PERCENT
NAME (AGE) AND ADDRESS DIRECTORSHIPS IN DIRECTOR 10, OF
OF NOMINEES/DIRECTORS PUBLICLY HELD COMPANIES SINCE 2000(+) CLASS
- -------------------------------- -------------------------------------- -------- ------------ -------
<S> <C> <C> <C> <C> <C>
David G. Harmer (56) President, Jetway Systems, a division 1997 1,000 **
1805 West - 2550 South of FMC Corporation, since
Ogden, UT January 1997; Vice President and Chief
84401 Financial Officer, Armco Inc., from
April 1993 to December 1996; Vice
President and Corporate Controller,
FMC Corporation, from 1987 to 1993;
Director, The Singapore Fund, Inc.,
since 1996.
</TABLE>
- ------------------------
+ The information as to beneficial ownership is based on statements furnished
to the Fund by the nominees and directors.
* Directors so noted are deemed by the Fund's counsel to be "interested
persons" (as defined in the U.S. Investment Company Act of 1940, as amended
(the "1940 Act")) of the Fund or of the Fund's investment manager, Daiwa SB
Investments (USA) Ltd. (the "Investment Manager"), or the Fund's investment
adviser, Daiwa SB Investments Ltd. (the "Investment Adviser"). Mr. Matsuura
and Dr. Markowitz are interested persons because of their present or past
affiliation with the Fund's former investment adviser (Daiwa Securities
Trust Company), or because they are officers of the Fund, or both. The
former investment adviser is an affiliate of the Fund's Investment Manager
and Investment Adviser.
** Represented less than 1% of the outstanding shares at January 10, 2000.
The Fund's Board of Directors held four regular meetings during the fiscal
year ended October 31, 1999. Each incumbent director attended at least
seventy-five percent of the aggregate number of meetings of the Board of
Directors.
The Fund's Board of Directors has an Audit Committee which is responsible
for reviewing financial and accounting matters. The current members of the Audit
Committee are Messrs. Dowling, Gurnee and Harmer and Dr. Gruber. The Audit
Committee met twice during the fiscal year ended October 31, 1999. All of the
incumbent members of the Audit Committee attended the meetings held during the
fiscal year. The Fund has neither a compensation nor a nominating committee.
Section 16(a) of the U.S. Securities Exchange Act of 1934, as amended,
requires the Fund's officers and directors, and persons who own more than ten
percent of a registered class of the Fund's equity securities, to file reports
of ownership and changes in ownership with the Securities and Exchange
Commission and the New York Stock Exchange, Inc. The Fund believes that its
officers and directors have complied with all applicable filing requirements.
OFFICERS OF THE FUND
Mr. Matsuura (age 51) has been Chairman of the Board of the Fund since
September 1997 and Acting President of the Fund since January 2000 (see
information provided above).
4
<PAGE>
Sean J. Peters (age 38) has been Treasurer of the Fund since June 1998; Vice
President of Daiwa Securities Trust Company ("DSTC") since June 1998; Assistant
Controller of Reserve Management Corporation from 1994 to 1998; Assistant Vice
President of Bankers Trust Company from 1992 to 1994.
Judy Runrun Tu (age 34) has been Assistant Secretary of the Fund since
March 1999; Assistant Vice President of DSTC since March 1998; Financial Analyst
of Canon USA from 1997 to 1998; Marketing Coordinator of TotalTel USA from 1995
to 1997; Assistant Controller of Daniel Caron Ltd. from 1990 to 1995.
Laurence E. Cranch (age 53), has been Assistant Secretary of the Fund since
July 1992 and has been a partner in the law firm of Clifford Chance Rogers &
Wells LLP since 1980.
TRANSACTIONS WITH AND REMUNERATION OF OFFICERS AND DIRECTORS
The aggregate fee remuneration for directors not affiliated with the
Investment Manager or the Investment Adviser was U.S. $36,800 during the fiscal
year ended October 31, 1999. Each such non-affiliated director currently
receives fees, paid by the Fund, of U.S. $750 for each directors' meeting
attended in person or by telephone, U.S. $600 for each audit committee meeting
attended in person or by telephone and an annual fee of U.S. $5,000. The
officers and interested directors of the Fund received no compensation from the
Fund.
DSTC, which pays the compensation and certain expenses of the officers of
DSTC who serve as officers of the Fund, receives administration and custodian
fees.
Set forth below is a chart showing the aggregate fee compensation paid by
the Fund (in U.S. dollars) to each of its directors during the fiscal year ended
October 31, 1999, as well as the total fee compensation paid to each incumbent
director of the Fund by the Fund and by other investment companies advised by
the Investment Manager, the Investment Adviser or their respective affiliates
(collectively, the "Fund Complex") for their services as directors of such
investment companies during their respective fiscal years:
<TABLE>
<CAPTION>
TOTAL
PENSION OR COMPENSATION
RETIREMENT FROM FUND AND
AGGREGATE BENEFITS ACCRUED FUND COMPLEX
COMPENSATION AS PART OF PAID TO
NAME OF DIRECTOR FROM FUND FUND EXPENSES DIRECTORS
- ------------------------------------ ------------ ---------------- -------------
<S> <C> <C> <C>
Hideaki Matsuura+ $ 0 None $ 0
Harry M. Markowitz+ 0 None 0
Austin C. Dowling* 9,200 None 17,020
Martin J. Gruber* 9,200 None 18,400
Robert F. Gurnee* 9,200 None 17,020
David G. Harmer* 9,200 None 18,400
</TABLE>
- ------------------------
* Also serves or served as a director of one other investment company for
which an affiliate of Daiwa SB Investments (USA) Ltd. or Daiwa SB
Investments Ltd., the Fund's investment manager and investment adviser,
respectively, serves as investment manager or investment adviser.
+ Mr. Matsuura, who is affiliated with the Investment Manager and Investment
Adviser and is considered an "interested person" of the Fund, did not
receive any fee compensation from the
5
<PAGE>
Fund for his service as director. Dr. Markowitz, who was affiliated with the
Investment Manager and the Investment Adviser and is considered an
"interested person" of the Fund, did not receive any fee compensation from
the Fund for his service as director.
(2) RATIFICATION OR REJECTION OF SELECTION
OF INDEPENDENT ACCOUNTANTS
At a meeting held on December 2, 1999, the Board of Directors of the Fund,
including a majority of the directors who are not "interested persons" of the
Fund (as defined in the 1940 Act), selected PricewaterhouseCoopers LLP to act as
independent accountants for the Fund for the fiscal year ending October 31,
2000. The Fund knows of no direct financial interest or material indirect
financial interest of that firm in the Fund. One or more representatives of
PricewaterhouseCoopers LLP are expected to be present at the Meeting and will
have an opportunity to make a statement if they so desire. Such representatives
are expected to be available at the Meeting to respond to appropriate questions
from stockholders.
This selection of independent accountants is subject to the ratification or
rejection of the Fund's stockholders at the Meeting. Ratification of the
selection of the independent accountants will require the affirmative vote of a
majority of the votes cast at the Meeting. For this purpose, abstentions and
broker nonvotes will not be counted as votes cast at the Meeting.
(3) APPROVAL OF A CHANGE IN THE FUND'S INVESTMENT OBJECTIVE
The Board of Directors of the Fund has unanimously approved and directed
that there be submitted to the stockholders for their approval a change to the
Fund's investment objective. The proposed new investment objective would be to
outperform over the long term, on a total return basis (including appreciation
and dividends) the TOPIX, a composite market-capitalization weighted index of
all common stocks listed on the First Section of the Tokyo Stock Exchange
("TSE").
The Board of Directors believes that the proposed change is in the best
interests of the Fund because it will permit the Fund to invest in securities of
companies in the financial services sector when the Funds' Investment Adviser
believes that the financial services sector will provide the Fund with an above
average return. Accordingly, the Directors recommend that the stockholders vote
to approve the proposed amendment to the Fund's investment objective.
Currently, the Fund's investment objective states that:
"The investment objective of the Fund is to outperform over the
long term, on a total return basis (including appreciation and
dividends), the non-financial services sectors of the TOPIX, a
composite index of all common stocks listed on the First Section
of the TSE."
The text of the proposed amendment is as follows:
"The investment objective of the Fund is to outperform over the
long term, on a total return basis (including appreciation and
dividends), the TOPIX, a composite index of all common stocks
listed on the First Section of the TSE."
As a result of this change in the Fund's investment objective, the Fund
would be permitted to invest in companies in the financial services sector of
the TOPIX. If the stockholders approve the
6
<PAGE>
above change to the Fund's investment objective, the Fund's Investment Manager
and Investment Adviser intend to invest a portion of the Fund's assets in the
financial services sector of the TOPIX. Consequently, the Fund will assume the
risk that the financial services sector might not perform as well as other
sectors of the TOPIX and might have more volatile fluctuations in the price of
its securities than other sectors.
Approval of the proposed amendment to the Fund's investment objective will
require the affirmative vote of a majority of the Fund's outstanding shares of
Common Stock. As defined in the 1940 Act, a "majority of outstanding shares"
means the lesser of 67% of the voting securities present at the Annual Meeting
of Stockholders, if a quorum is present, or 50% of the outstanding voting
securities. For this purpose, both the abstentions and broker non-votes will
have the effect of a vote to disapprove the proposed amendment. The Fund will
continue under its current investment objective without change if this proposal
is not approved by the stockholders.
Also, it is anticipated that the Board of Directors will vote to amend the
Fund's investment policy at the next meeting of the Board of Directors scheduled
for February 28, 2000. Currently, the Fund seeks to achieve its investment
objective by investing substantially all of its assets in equity securities of
non-financial services companies listed on the First Section of the TSE. If the
Board of Directors votes to amend the Fund's investment policy, the amended
investment policy will be for the Fund to seek to achieve its investment
objective by investing substantially all of its assets in equity securities of
non-financial services companies listed on the First or Second Section of the
TSE or listed on the over-the-counter market in Japan or listed on other stock
exchanges in Japan. The TSE's First Section is for established companies (in
existence for five years or more) that meet the stringent listing criteria for
that Section. These listing criteria relate to the size and business condition
of the issuing company, the liquidity of its securities and other factors
pertinent to investor protection. The TSE also has a Second Section for smaller
companies and newly listed issuers.
There are several reasons for the above changes in the Fund's investment
objective and investment policy. The prior investment adviser provided the
Investment Manager with investment recommendations based on a statistical and
optimization selection process known as the Daiwa Portfolio Optimization System
("DPOS"), and DPOS was designed to invest only in companies in the non-
financial services sectors of the TOPIX. The new investment adviser will provide
investment recommendations to the Investment Manager based on an "active"
management style of securities selection based on analysis of various factors
that may affect the value of securities. The new investment adviser believes it
will be able to manage the Fund more effectively and achieve a greater return
for the Fund with the ability to invest in all sectors of the First and Second
Sections of the TSE or in the over-the-counter market in Japan or other stock
exchanges in Japan. By being permitted to invest in more sectors and on more
exchanges in Japan, the new investment adviser believes that the Fund will
achieve a greater return because it will permit the Fund to have greater
flexibility to invest in additional sectors when the investment adviser believes
those sectors will provide the Fund with an above average return.
(4) APPROVAL OF A NEW ADVISORY AGREEMENT
THE INVESTMENT ADVISER
Prior to January 1, 2000, Daiwa Securities Trust Company ("DSTC") acted as
the investment adviser to the investment manager with respect to the Fund's
investments. Effective January 1, 2000, Daiwa SB Investments Ltd. (the
"Investment Adviser"), a corporation incorporated in Tokyo under
7
<PAGE>
the laws of Japan, acts as the new investment adviser to Daiwa SB Investments
(USA) Ltd. (the "Investment Manager") with respect to the Fund's investments.
The new Investment Adviser was formed in 1973 as an investment advisory firm
specializing in Asian equity management. The Investment Adviser is registered
under the U.S. Investment Advisers Act of 1940, as amended. The Investment
Adviser currently provides investment advisory services, with respect to
securities traded principally in Japan, other Asian countries, the United States
and other European countries. As a member of Daiwa Securities Group, Inc., the
Investment Adviser has access to the Group's resources, including those of the
Daiwa Institute of Research and the Japanese Institute of Research.
The Investment Adviser manages approximately $30 billion for clients
worldwide, over $10 billion of which is invested on behalf of institutional
clients outside of Japan. The Investment Adviser currently is a subsidiary of
Daiwa Securities Group, Inc., which owns 44% of the outstanding shares. Also,
The Sumitomo Bank and TRPH Corporation each held 30.4% and 10.0% of the
outstanding stock of the Investment Adviser, respectively. The address of the
Investment Adviser is 7-9, Nihonbashi, 2-chome, Chuo-ku, Tokyo 103-0027 Japan.
Certain information regarding the directors and the principal executive
officers of the Investment Adviser is set forth below:
<TABLE>
<CAPTION>
PRINCIPAL OCCUPATION
AND POSITION WITH THE
NAME NEW INVESTMENT ADVISER
- -------------------- -------------------------------------
<S> <C>
Ichiro Yamanaka Chairman of the Board
Minoru Mori President and Chief Executive Officer
Katsuhiko Tamaki Deputy President
Nobumasa Wakabayashi Senior Managing Director
Norio Imai Senior Managing Director
Isao Takemura Managing Director
Katsumi Ando Managing Director
David Michael Testa Director
</TABLE>
THE TERMINATION OF PRIOR ADVISORY AGREEMENT
As a result of the vote of the Board of Directors on December 2, 1999, the
prior Investment Advisory Agreement dated April 1, 1999 between the Investment
Manager and Daiwa Securities Trust Company (the "Prior Advisory Agreement")
terminated on December 31, 1999. The Prior Advisory Agreement is being
terminated because of the resignation of Dr. Harry M. Markowitz as the Fund's
President and Portfolio Manager, effective December 31, 1999. Because Dr.
Markowitz is also retiring from DSTC, the Board of Directors decided that the
Fund would no longer use the sevices of DSTC as the Fund's investment adviser,
and would instead use an investment adviser which utilized an active management
approach to securities selection instead of using DSTC's statistical and
optimization selection process known as DPOS.
THE ADVISORY AGREEMENTS
As a result of the termination of the Prior Advisory Agreement, a majority
of the Directors of the Fund who are not officers of the Fund or affiliated with
the Investment Adviser or the Investment Manager (the "Disinterested
Directors"), voting in person, approved a new investment advisory agreement (the
"New Advisory Agreement") between the Investment Manager and Daiwa SB
Investments Ltd., the new Investment Adviser. The New Advisory Agreement is
substantially the same as the Prior Advisory Agreement, except for certain
provisions that are discussed below. See "The New
8
<PAGE>
Advisory Agreement." The holders of a majority of the outstanding voting
securities (within the meaning of the 1940 Act) of the Fund are being asked to
approve the New Advisory Agreement. See "The New Advisory Agreement" below.
The following is a summary of the Prior Advisory Agreement and the New
Advisory Agreement. The description of the New Advisory Agreement is qualified
by reference to Annex A.
THE PRIOR ADVISORY AGREEMENT
The prior Investment Advisory Agreement, dated as of April 1, 1999, was last
submitted to a vote by the Fund's stockholders at the September 16, 1999 Annual
Meeting of Stockholders to approve the Investment Advisory Agreement.
Under the terms of the Prior Advisory Agreement, DSTC was required to
provide the Investment Manager with investment recommendations based on a
statistical and optimization selection process known as DPOS and also to prepare
and make available research and statistical data and to provide specific advice
to the Investment Manager regarding Japanese equities. The information and
investment advice received by the Investment Manager from DSTC was used for the
purpose of managing the Fund's investment portfolio and was evaluated by the
Investment Manager's staff in light of their own expertise and information from
other sources.
DSTC was responsible for the salaries and reasonable expenses of the Fund's
officers and employees, as well as reasonable fees and expenses of the Fund's
Directors, who are directors, officers or employees of DSTC or any of its
affiliated persons, except that the Fund would bear travel expenses or an
appropriate fraction thereof of officers and Directors of the Fund who are
directors, officers or employees of DSTC to the extent such expenses relate to
attendance at meetings held in connection with the Fund's operation, including
meetings of the Fund's Board of Directors or any committee thereof.
The Prior Advisory Agreement provided that DSTC would not be liable for any
act or omission, error of judgment or mistake of law, or for any loss suffered
by the Fund in connection with matters to which the Prior Advisory Agreement
related, except for a loss resulting from willful misfeasance, bad faith or
gross negligence on the part of DSTC in the performance of its duties, or from
reckless disregard by DSTC of its obligations and duties under the Prior
Advisory Agreement.
For the fiscal year ended October 31, 1999, the Fund paid a gross investment
management fee and expenses of U.S. $307,100 to the Investment Manager. Of this
amount, a total of U.S. $210,116 was paid by the Investment Manager to DSTC as
its advisory fee.
DSTC also acts as U.S. custodian and administrator to the Fund. For its
services as U.S. custodian and administrator, DSTC received from the Fund fees
and expenses of U.S. $41,697 and U.S. $150,300, respectively, for the fiscal
year ended October 31, 1999. Brokerage commissions of $108,254 (38.58% of the
Fund's aggregate brokerage commissions paid) were paid by the Fund to Daiwa
Securities America, Inc., which is an affiliate of the Investment Manager and
DSTC, for the fiscal year ended October 31, 1999, in connection with the Fund's
portfolio transactions. Daiwa Securities Group Inc. is the parent company of
DSTC and Daiwa Securities America Inc., and a major shareholder of the
Investment Manager. DSTC will continue to act as the Fund's U.S. custodian and
administrator to the Fund after the approval of the New Advisory Agreement.
The Prior Advisory Agreement also had a provision for termination without
penalty at any time by DSTC or the Investment Manager upon 60 days' written
notice.
9
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THE NEW ADVISORY AGREEMENT
The Board of Directors of the Fund, including the Disinterested Directors,
approved The New Advisory Agreement on December 2, 1999, the form of which is
attached as Annex A and recommended the New Advisory Agreement for approval by
the stockholders of the Fund. The New Advisory Agreement is substantially the
same as the Prior Advisory Agreement except for certain provisions that are
described below. The New Advisory Agreement took effect on January 1, 2000
subject to stockholder approval. The New Advisory Agreement will continue in
effect for an initial two-year term and thereafter for successive annual periods
as long as such continuance is approved in accordance with the 1940 Act.
There are a few differences between the New Advisory Agreement and the Prior
Advisory Agreement. Under the New Advisory Agreement, instead of using the DPOS
model, the Investment Adviser intends to adopt an approach that involves
quantitative valuation of securities to identify an appropriate universe of
securities from which to select investments, with judgmental analysis then
applied to this universe to determine the actual investments to be made by the
Fund. Because the Investment Adviser will use judgmental analysis to determine
the investments made by the Fund, the Fund will be relying more on the skill of
the Investment Adviser to select securities, and the Fund is exposed to the risk
that the Investment Adviser will select securities which lower the overall
return of the Fund. In addition, the investment advisory fee as a percentage of
net assets payable by the Investment Manager to the Investment Adviser will be
lower under the New Advisory Agreement than under the Prior Advisory Agreement.
Under the Prior Advisory Agreement, the prior investment adviser was paid an
advisory fee equal to 70% of the fee which the Investment Manager receives from
the Fund. For services rendered under the New Advisory Agreement, the Investment
Adviser will be paid an advisory fee equal to 60% of the fee which the
Investment Manager receives from the Fund. Such fee will accrue and be payable
in arrears promptly after the close of each quarter of the Fund's fiscal year.
Although the advisory fee paid to the Investment Adviser will be lower under the
New Advisory Agreement, the fee paid by the Fund to the Investment Manager will
remain the same. Lastly, until further notice, the Investment Manager delegates
to the Investment Adviser the authority to place all orders for the purchase or
sale of portfolio securities for the Fund with brokers or dealers selected by
the Investment Adviser.
In evaluating the New Advisory Agreement, the Board took into account that
the Fund's Prior Advisory Agreement and the New Advisory Agreement, including
that their terms relating to the services to be provided thereunder by the
Investment Adviser are identical, except for the above exceptions. The Board
also considered the skills and capabilities of the Investment Adviser.
Specifically, as discussed earlier, the Directors believed that the Fund would
benefit from having an investment adviser which would use an active management
approach to securities selection instead of using DPOS.
After consideration of the above factors and such other factors and
information that the Board deemed relevant, the Directors, and the Disinterested
Directors voting separately, unanimously approved the New Advisory Agreement and
voted to recommend its approval to the stockholders of the Fund.
In the event that stockholders of the Fund do not approve the New Advisory
Agreement, the Board will take such action as it deems in the best interest of
the Fund and its stockholders, which may include proposing that stockholders
approve an agreement in lieu of the New Advisory Agreement.
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<PAGE>
STOCKHOLDER APPROVAL
To become effective, the New Advisory Agreement must be approved by a vote
of a majority of the outstanding voting securities of the Fund. The "vote of a
majority of the outstanding voting securities" is defined under the 1940 Act as
the lesser of the vote of (i) 67% or more of the shares of the Fund entitled to
vote thereon present at the Meeting if the holders of more than 50% of such
outstanding shares of the Fund are present in person or represented by proxy, or
(ii) more than 50% of such outstanding shares of the Fund entitled to vote
thereon. The New Advisory Agreement was approved by the Board after
consideration of all factors which they determined to be relevant to their
deliberations, including those discussed above. The Board also determined to
submit the New Advisory Agreement for consideration by the stockholders of the
Fund.
THE BOARD OF DIRECTORS OF THE FUND RECOMMENDS THAT YOU VOTE "FOR" APPROVAL
OF THE NEW ADVISORY AGREEMENT.
MISCELLANEOUS
Proxies will be solicited by mail and may be solicited in person or by
telephone or telegraph by officers of the Fund or personnel of DSTC. The Fund
has retained Corporate Investor Communications, Inc. to assist in the proxy
solicitation. The fee for such services is estimated at U.S. $4,500, plus
reimbursement of expenses. The expenses connected with the solicitation of these
proxies and with any further proxies which may be solicited by the Fund's
officers or agents in person, by telephone or by telegraph will be borne by the
Fund. The Fund will reimburse banks, brokers and other persons holding the
Fund's shares registered in their names or in the names of their nominees for
their expenses incurred in sending proxy material to and obtaining proxies from
the beneficial owners of such shares.
It is important that you promptly submit your vote as a stockholder of the
Fund. In the event that sufficient votes in favor of any proposal set forth in
the Notice of this Meeting are not received by March 16, 2000, the persons named
as attorneys in the enclosed proxy may propose one or more adjournments of the
Meeting to permit further solicitation of proxies. Any such adjournment will
require the affirmative vote of the holders of a majority of the shares present
in person or by proxy at the session of the Meeting to be adjourned. The persons
named as attorneys in the enclosed proxy will vote in favor of such adjournment
those proxies which they are entitled to vote in favor of the proposal for which
further solicitation of proxies is to be made. They will vote against any such
adjournment those proxies required to be voted against such proposal. The costs
of any such additional solicitation and of any adjourned session will be borne
by the Fund.
STOCKHOLDER PROPOSALS
Any proposal by a stockholder of the Fund intended to be included in the
proxy materials for the year 2001 meeting of stockholders of the Fund must be
received by the Fund, c/o Daiwa Securities Trust Company, One Evertrust Plaza,
9th Floor, Jersey City, New Jersey 07302, not later than December 10, 2000.
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The Fund's By-laws require that any proposal by a stockholder of the Fund
intended to be presented at a meeting of stockholders must be received by the
Fund, c/o Daiwa Securities Trust Company, One Evertrust Plaza, 9th Floor, Jersey
City, New Jersey 07302, not earlier than 90 days prior and not later than 60
days prior to such meeting of stockholders.
By order of the Board of Directors,
Judy Runrun Tu
ASSISTANT SECRETARY
One Evertrust Plaza
Jersey City, New Jersey 07302
February 11, 2000
12
<PAGE>
ANNEX A
INVESTMENT ADVISORY AGREEMENT
The INVESTMENT ADVISORY AGREEMENT, dated as of January 1, 2000, is between
DAIWA SB INVESTMENTS (USA) LTD. (hereinafter called "DSBI (USA)"), a Delaware
corporation, located at 380 Madison Avenue, 23rd Floor, New York, New York
10017, and DAIWA SB INVESTMENTS LTD. (hereinafter called "DSBI"), a Japanese
corporation, located at 7-9, Nihonbashi 2-chome, Chuo-ku, Tokyo 103-0027.
WHEREAS, DSBI (USA) acts as investment manager to THE JAPAN EQUITY FUND,
INC. (hereinafter called the "Fund"), and wishes to appoint DSBI as its
investment adviser in respect to the Fund's investment portfolio, the parties to
this Agreement agree as follows:
1. ACCEPTANCE OF APPOINTMENT: DSBI (USA) hereby appoints DSBI as its
investment adviser for the Fund and DSBI hereby agrees to accept such
appointment, subject to the terms and conditions set forth herein.
2. ADVISORY SERVICES TO BE RENDERED: DSBI's investment advice shall be
limited to the specific types of securities permitted by the Fund's investment
objective and policies and subject to the Fund's investment restrictions, which
will be furnished to DSBI by DSBI (USA). DSBI will provide to DSBI (USA) the
following investment advisory services:
(a) DSBI will review, analyze and appraise portfolio securities of the Fund
as often as DSBI (USA) reasonably deems advisable, and submit to DSBI (USA)
written recommendations for investment and reinvestment. DSBI intends to adopt
an approach that involves quantitative valuation of securities to identify an
appropriate universe of securities from which to select investments, with
judgmental analysis then applied to this universe to determine the actual
investments to be made by the Fund.
(b) Upon DSBI (USA)'s request, DSBI will confer with DSBI (USA) regarding
such recommendations.
(c) DSBI will render periodic reports, analyses, and appraisals of the Fund
or individual items thereof, as DSBI (USA) may reasonably deem advisable.
(d) DSBI will prepare and make available research and statistical data and
provide specific advice to DSBI (USA) regarding Japanese equity securities.
At all times DSBI (USA) shall be at liberty either to follow or disregard either
wholly or partially any information, advice, or recommendation as to the
investment and reinvestment of the Fund's portfolio securities in accordance
with the Fund's investment objective and policies, as set forth in the Fund's
prospectus. It shall be DSBI (USA)'s responsibility to communicate promptly with
DSBI as to its decision regarding DSBI's advice or recommendations.
Until further notice, DSBI (USA) delegates to DSBI the authority to place
all orders for the purchase or sale of portfolio securities for the Fund with
brokers or dealers selected by DSBI, and in connection therewith, DSBI is
authorized as agent of the Fund to give instructions to the custodians of the
Fund's assets as to deliveries of securities and payments of cash for the
account of the Fund. In
13
<PAGE>
connection with the selection of such brokers or dealers and the placing of such
orders, DSBI is directed at all times to seek to obtain the best results for the
Fund as determined by the Board of Directors of the Fund and as set forth in the
Fund's prospectus.
3. COMPENSATION: DSBI's fee for providing this service shall be in
accordance with the schedule set forth as Exhibit A hereto.
4. DURATION AND TERMINATION:
(a) This Agreement shall become effective on the date hereof and shall
remain in full force for a period of two years from the date hereof, unless
sooner terminated as hereinafter provided. This Agreement shall continue in
force from year to year thereafter, but only as long as such continuance is
specifically approved at least annually in the manner required by the Investment
Company Act of 1940, as amended (the "1940 Act") and the rules and regulations
of the SEC thereunder; provided, however, that if the continuation of this
Agreement is not approved, DSBI may continue to serve in the manner and to the
extent permitted by the 1940 Act and the rules and regulations of the SEC
thereunder.
(b) This Agreement shall terminate automatically (i) in the event of
termination of DSBI (USA)'s management agreement with the Fund, or (ii) without
payment or penalty by either party or the Fund, upon 60 days' notice or
(iii) in the event of its assignment (as defined in the 1940 Act).
5. REPRESENTATIONS AND WARRANTIES:
(a) DSBI (USA) represents and warrants that: (i) it has the legal right,
power and authority to execute, deliver and perform this Agreement and to carry
out all of the transactions contemplated hereby; (ii) it has obtained all
necessary authorizations; (iii) the execution, delivery and performance of this
Agreement and the carrying out of any of the transactions contemplated hereby
will not be in conflict with, result in a breach of, or constitute a default
under, any agreement or other instrument to which DSBI (USA) is a party or which
is otherwise known to DSBI (USA); (iv) it does not require the consent or
approval of any governmental agency or instrumentality, except any such consents
and approvals which DSBI (USA) has obtained prior to the execution of this
Agreement; (v) the execution and delivery of this Agreement by DSBI (USA) will
not violate any law, regulation, charter, by law, order of any court or other
government agency or judgment applicable to DSBI (USA); and (vi) all persons
executing this Agreement on behalf of DSBI (USA) are duly authorized to do so.
(b) DSBI represents and warrants that it is duly registered and authorized
as an investment adviser under the Investment Advisers Act of 1940, as amended,
and that it will use all reasonable efforts to maintain effective its
registration and authorization until the termination of this Agreement.
6. STANDARD OF CARE; INDEMNIFICATION:
(a) DSBI will exercise its best judgment in rendering the services to be
provided by it hereunder. DSBI shall not be liable for any error of judgment or
of law or for any loss suffered by DSBI (USA) or by the Fund in connection with
the matters to which this Agreement relates, except loss resulting from willful
misfeasance, bad faith or gross negligence on the part of DSBI in the
performance of its obligations and duties or by reason of its reckless disregard
of its obligations and duties under this Agreement.
14
<PAGE>
(b) DSBI (USA) agrees to indemnify and hold harmless DSBI, its officers,
directors, employees, agents, shareholders, or other affiliates (each an
"Indemnified Party"), for any losses, costs and expenses proceeding or claims
which may be brought against such Indemnified Party in connection with the
performance or nonperformance in good faith of its functions under this
Agreement, except losses, costs and expenses resulting from willful misfeasance,
bad faith or gross negligence in the performance of such Indemnified Party's
duties or from reckless disregard on the part of such Indemnified Party of such
Indemnified Party's obligations and duties under this Agreement.
7. EXPENSES: DSBI will pay the salaries and reasonable expenses of the
Fund's officers and employees, as well as reasonable fees and expenses of the
Fund's Directors, who are directors, officers or employees of DSBI or any of its
affiliation persons, except that the Fund will bear travel expenses or an
appropriate fraction thereof of officers and Directors of the Fund who are
directors, officers or employees of DSBI to the extent such expenses relate to
attendance at meetings held in connection with the Fund's operation, including
meetings of the Fund's Board of Directors or any committee thereof.
Notwithstanding anything to the contrary in this Section 7, DSBI shall not be
entitled to receive reimbursement for its expenses from the Fund pursuant to
this Agreement for the period from the date of this Agreement to the date on
which this Agreement is approved by the stockholders of the Fund unless and
until the payment of fees and expenses under this Agreement are approved by the
stockholders of the Fund.
8. GENERAL: DSBI (USA) agrees that DSBI shall have no responsibilities or
duties with respect to the subject matter of this Agreement other than those
expressly set forth herein. DSBI (USA) also agrees to execute such documents as
DSBI may reasonably request of DSBI (USA) to assist DSBI in carrying out its
responsibilities and duties hereunder.
9. SEVERABILITY: In case any one or more of the provisions contained in
this Agreement should be or become invalid, illegal or unenforceable in any
respect, the validity, legality and enforceability of the remaining provisions
contained herein shall in no way be affected, prejudiced or disturbed thereby.
10. NON-EXCLUSIVITY OF SERVICES: The services of DSBI to DSBI (USA) under
this Agreement are not to be deemed exclusive, and DSBI shall be free to render
similar services or other services to others so long as its services hereunder
are not impaired thereby.
11. NOTICES: Any notice under this Agreement shall be in writing,
addressed and delivered or mailed, postage prepaid, to the other party at such
address as such other party may designate for the receipt of such notice.
12. GOVERNING LAW: The provisions of and the validity and construction of
this Agreement shall be governed by and construed in accordance with the laws of
the State of New Jersey.
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<PAGE>
IN WITNESS WHEREOF, the parties have caused this instrument to be executed
by their authorized representatives as of the date and year first above written.
DAIWA SB INVESTMENTS (USA) LTD. DAIWA SB INVESTMENTS LTD.
By: By:
------------------------------ ------------------------------
Name: Name:
Title: Title:
Acknowledged:
THE JAPAN EQUITY FUND, INC.
By:
------------------------------
Name:
Title:
16
<PAGE>
EXHIBIT A
INVESTMENT ADVISORY AGREEMENT
FEE SCHEDULE
DSBI's advisory fee shall be 60% of the fee which DSBI (USA) receives from
The Japan Equity Fund, Inc. (the "Fund"). Such fee shall accrue and be payable
in arrears promptly after the close of each quarter of the Fund's fiscal year.
17
<PAGE>
THE JAPAN EQUITY FUND, INC.
C/O DAIWA SECURITIES TRUST COMPANY
ONE EVERTRUST PLAZA
JERSEY CITY, NEW JERSEY 07302
----------------------
THE JAPAN EQUITY FUND, INC.
PROXY SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
FOR THE ANNUAL MEETING OF STOCKHOLDERS ON
MARCH 16, 2000
The undersigned stockholder of The Japan Equity Fund, Inc. (the "Fund") hereby
appoints Hideaki Matsuura, Sean J. Peters and Judy Runrun Tu, or any of them,
proxies of the undersigned, with full power of substitution, to vote and act for
and in the name and stead of the undersigned at the Annual Meeting of
Stockholders of the Fund, to be held at the offices of Daiwa Securities America
Inc., Financial Square, 32 Old Slip, 14th Floor, New York, New York 10005, on
March 16, 2000, at 10:00 a.m., New York time, and at any and all adjournments
thereof, according to the number of votes the undersigned would be entitled to
cast if personally present.
PROPOSALS
1) The election of Martin J. Gruber and Hideaki Matsuura as Class I directors
to serve for a term expiring on the date on which the Annual Meeting of
Stockholders is held in the year 2003.
2) The ratification of the selection of PricewaterhouseCoopers LLP as
independent accountants of the Fund for the fiscal year ending October 31,
2000.
3) The approval of a change in the Fund's investment objective to: to
outperform over the long term, on a total return basis (including
appreciation and dividends) the Tokyo Stock Price Index.
4) The approval of a new Investment Advisory Agreement between Daiwa SB
Investments (USA) Ltd., as investment manager of the Fund, and Daiwa SB
Investments Ltd., as investment adviser of the Fund.
THE SHARES REPRESENTED BY THIS PROXY WILL BE VOTED IN ACCORDANCE WITH
INSTRUCTIONS GIVEN BY THE STOCKHOLDERS, BUT IF NO INSTRUCTIONS ARE GIVEN, THIS
PROXY WILL BE VOTED IN FAVOR OF PROPOSALS 1 THROUGH 4 SET FORTH IN THIS PROXY.
IN ADDITION, THIS PROXY WILL BE VOTED, IN THE DISCRETION OF SUCH PROXIES, UPON
SUCH OTHER BUSINESS AS MAY PROPERLY COME BEFORE THE MEETING OR ANY ADJOURNMENT
THEREOF. THE UNDERSIGNED HEREBY REVOKES ANY AND ALL PROXIES WITH RESPECT TO SUCH
SHARES HERETOFORE GIVEN BY THE UNDERSIGNED. THE UNDERSIGNED ACKNOWLEDGES RECEIPT
OF THE PROXY STATEMENT DATED FEBRUARY 11, 2000.
(OVER)
<PAGE>
PROPOSALS (PLEASE CHECK ONE BOX FOR EACH PROPOSAL.)
<TABLE>
<S> <C> <C>
1) / / FOR ALL nominees listed below / / WITHHOLD AUTHORITY
(EXCEPT AS MARKED TO THE CONTRARY TO VOTE FOR ALL NOMINEES LISTED
BELOW) BELOW
</TABLE>
Nominees: Class I - Martin J. Gruber, Hideaki Matsuura
(Instruction: To withhold authority to vote for any individual nominee, write
that nominee's name in the space provided below.)
- --------------------------------------------------------------------------------
2) / / FOR / / AGAINST / / ABSTAIN
3) / / FOR / / AGAINST / / ABSTAIN
4) / / FOR / / AGAINST / / ABSTAIN
Dated: __________________________________________________________________ , 2000
________________________________________________________________________________
________________________________________________________________________________
Signature(s) of Stockholder(s)
Please sign, date and return promptly. Signature(s) should be exactly as name or
names appearing on this proxy. If shares are held jointly, each holder should
sign. If signing is by attorney, administrator, trustee or guardian, please give
full title. If the shareholder is a corporation, the President or a Vice
President should sign in his or her own name, indicating title. If the
shareholder is a partnership, a partner should sign in his or her own name,
indicating that he or she is a "Partner".
