<PAGE>
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [_]
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 (S) 240.14a-11(c) or (S) 240.14a-12
STRATEGIC GLOBAL INCOME FUND, INC.
--------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
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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:
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[_] 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.:
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(3) Filing Party:
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(4) Date Filed:
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Notes:
Reg. (S) 240.14a-101.
SEC 1913 (3-99)
<PAGE>
STRATEGIC GLOBAL INCOME FUND, INC.
----------------
NOTICE OF
ANNUAL MEETING OF SHAREHOLDERS
MARCH 15, 2001
----------------
TO THE SHAREHOLDERS:
The annual meeting of shareholders of Strategic Global Income Fund, Inc.
("Fund") will be held on March 15, 2001 at 10:00 a.m., Eastern time, at 1285
Avenue of the Americas, 14th Floor, New York, New York 10019 for the following
purposes:
(1) To elect nine (9) Directors to serve until the annual meeting of
shareholders in 2002, or until their successors are elected and
qualified;
(2) To ratify the selection of Ernst & Young LLP as the Fund's independent
auditors for the fiscal year ending November 30, 2001;
(3) To approve a sub-adviser approval policy for the Fund; and
(4) To transact such other business as may properly come before the meeting
or any adjournment thereof.
You are entitled to vote at the meeting and any adjournments thereof if you
owned Fund shares at the close of business on January 19, 2001. If you attend
the meeting, you may vote your shares in person. IF YOU DO NOT EXPECT TO
ATTEND THE MEETING, PLEASE COMPLETE, DATE, SIGN AND RETURN THE ENCLOSED PROXY
CARD IN THE ENCLOSED POSTAGE PAID ENVELOPE.
By order of the Board of Directors,
Dianne E. O'Donnell
Secretary
January 31, 2001
51 West 52nd Street
New York, New York 10019-6114
YOUR VOTE IS IMPORTANT
NO MATTER HOW MANY SHARES YOU OWN.
PLEASE INDICATE YOUR VOTING INSTRUCTIONS ON THE ENCLOSED PROXY CARD, DATE
AND SIGN IT, AND RETURN IT IN THE POSTAGE PAID ENVELOPE PROVIDED. If you
sign, date and return the proxy card but give no voting instructions, your
shares will be voted "FOR" the nominees for Director named in the attached
proxy statement and "FOR" all other proposals noticed above. IN ORDER TO
AVOID THE ADDITIONAL EXPENSE TO THE FUND OF FURTHER SOLICITATION, WE ASK
YOUR COOPERATION IN MAILING IN YOUR PROXY CARD PROMPTLY.
If we do not receive your completed proxy cards after several weeks, our
proxy solicitor, Shareholder Communications Corporation, may contact you.
Our proxy solicitor will remind you to vote your shares or will record your
vote over the phone if you choose to vote in that manner.
<PAGE>
INSTRUCTIONS FOR SIGNING PROXY CARDS
The following general guidelines for signing proxy cards may be of
assistance to you and avoid the time and expense to the Fund of validating
your vote if you fail to sign your proxy card properly.
1. INDIVIDUAL ACCOUNTS: Sign your name exactly as it appears in the
registration on the proxy card.
2. JOINT ACCOUNTS: Either party may sign, but the name of the party signing
should conform exactly to the name shown in the registration on the proxy
card.
3. ALL OTHER ACCOUNTS: The capacity of the individual signing the proxy card
should be indicated unless it is reflected in the form of registration. For
example:
<TABLE>
<CAPTION>
REGISTRATION VALID SIGNATURE
------------ ---------------
<S> <C>
Corporate Accounts
(1) ABC Corp................................ ABC Corp.
John Doe, Treasurer
(2) ABC Corp................................ John Doe, Treasurer
(3) ABC Corp. c/o John Doe, Treasurer....... John Doe
(4) ABC Corp. Profit Sharing Plan........... John Doe, Trustee
Partnership Accounts
(1) The XYZ Partnership..................... Jane B. Smith, Partner
(2) Smith and Jones, Limited Partnership.... Jane B. Smith, General
Partner
Trust Accounts
(1) ABC Trust Account....................... Jane B. Doe, Trustee
(2) Jane B. Doe, Trustee u/t/d 12/18/78..... Jane B. Doe
Custodial or Estate Accounts
(1) John B. Smith, Cust. f/b/o John B.
Smith, Jr. UGMA/UTMA.................... John B. Smith
(2) Estate of John B. Smith................. John B. Smith, Jr., Executor
</TABLE>
<PAGE>
STRATEGIC GLOBAL INCOME FUND, INC.
51 WEST 52ND STREET
NEW YORK, NEW YORK 10019-6114
----------------
PROXY STATEMENT
----------------
ANNUAL MEETING OF SHAREHOLDERS TO BE HELD ON MARCH 15, 2001
This statement is furnished to the shareholders of Strategic Global Income
Fund, Inc. ("Fund") in connection with the Board of Directors' solicitation of
proxies to be used at the annual meeting of the shareholders of the Fund to be
held on March 15, 2001 at 10:00 a.m., Eastern time, at 1285 Avenue of the
Americas, 14th Floor, New York, New York 10019, or any adjournment or
adjournments thereof ("Meeting"). This proxy statement and the related proxy
card will first be mailed to shareholders on or about January 31, 2001.
The close of business on January 19, 2001 has been fixed as the record date
for the determination of shareholders entitled to notice of, and to vote at,
the Meeting. On that date, the Fund had shares of common stock
outstanding and entitled to vote. Each share of common stock is entitled to
one vote at the Meeting, and fractional shares are entitled to proportionate
shares of one vote. Management does not know of any person who owns
beneficially 5% or more of the outstanding shares of the Fund.
A majority of the shares outstanding on January 19, 2001, represented in
person or by proxy, must be present for the transaction of business at the
Meeting. In the event that a quorum is not present at the Meeting, or if a
quorum is present at the Meeting but sufficient votes to approve any of the
proposals are not received, the persons named as proxies may propose one or
more adjournments of the Meeting to permit further solicitation of proxies.
Any such adjournment will require the affirmative vote of a majority of those
shares represented at the Meeting in person or by proxy. The persons named as
proxies will vote those proxies which they are entitled to vote "FOR" any such
proposal in favor of such an adjournment, and will vote those proxies required
to be voted "AGAINST" any such proposal against such adjournment. A
shareholder vote may be taken on one or more of the proposals in this proxy
statement prior to any such adjournment if sufficient votes have been received
and it is otherwise appropriate.
Broker non-votes are shares held in street name for which the broker
indicates that instructions have not been received from the beneficial owners
or other persons entitled to vote and for which the broker does not have
discretionary voting authority. Abstentions and broker non-votes will be
counted as shares present for purposes of determining whether a quorum is
present but will not be voted for or against any proposal. Accordingly,
abstentions and broker non-votes effectively will be a vote against any
adjournment and Proposal 3, for which the required vote is a specified
majority of the outstanding shares of the Fund, but will have no impact on
Proposals 1 and 2, for which the required vote is a plurality and majority,
respectively, of the votes cast at the Meeting.
The individuals named as proxies on the enclosed proxy card will vote in
accordance with your direction as indicated thereon if your proxy card is
received properly executed by you or by your duly appointed agent or attorney-
in-fact. If you give no voting instructions, your shares will be voted "FOR"
the nine nominees for Director named herein, "FOR" the remaining proposals
described in this proxy statement and, in the proxies' discretion, either
"FOR" or "AGAINST" any other business which may properly arise at the Meeting.
You may
<PAGE>
revoke any proxy card by giving another proxy or by letter or telegram
revoking the initial proxy. To be effective, your revocation must be received
by the Fund prior to the Meeting and must indicate your name and account
number. In addition, if you attend the Meeting in person you may, if you wish,
vote by ballot at the Meeting, thereby cancelling any proxy previously given.
The solicitation of proxies, the cost of which will be borne by the Fund,
will be made primarily by mail but also may include telephone or oral
communications by regular employees of Mitchell Hutchins Asset Management Inc.
("Mitchell Hutchins") or PaineWebber Incorporated ("PaineWebber"), who will
not receive any compensation therefor from the Fund. In addition, the Fund has
engaged the services of Shareholder Communications Corporation to assist it in
the solicitation of proxies for the meeting. Shareholder Communications
Corporation will be paid approximately for proxy solicitation services.
Mitchell Hutchins serves as the Fund's investment adviser and administrator.
Mitchell Hutchins is a wholly owned asset management subsidiary of
PaineWebber, which is a wholly owned indirect subsidiary of UBS AG. UBS AG,
with headquarters in Zurich, Switzerland, is an internationally diversified
organization with operations in many areas of the financial services industry.
The principal business address of Mitchell Hutchins is 51 West 52nd Street,
New York, New York 10019-6114. The principal business address of PaineWebber
is 1285 Avenue of the Americas, New York, New York 10019-6028. The principal
business address of UBS AG is Bahnhofstrasse 45, Zurich, Switzerland.
The Fund's annual report containing financial statements for the fiscal year
ended November 30, 2000, is being mailed to shareholders concurrently with
this proxy statement.
PROPOSAL 1. ELECTION OF DIRECTORS
Proposal 1 relates to the election of Directors of the Fund. Management
proposes the election of the nine nominees named in the table below. Each
nominee, including those who are not "interested persons" of the Fund as that
term is defined by the Investment Company Act of 1940, as amended ("1940 Act")
("Independent Directors"), has indicated his or her willingness to serve if
elected. If elected, each nominee will hold office until the next meeting of
shareholders or until his or her successor is elected and qualified. Unless
you give contrary instructions on the enclosed proxy card, your shares will be
voted "FOR" the election of each of the nine nominees. If any of the nominees
should withdraw or otherwise become unavailable for election, your shares will
be voted "FOR" such other nominee or nominees as management may recommend.
Messrs. Feldberg, Gowen and Malek have each served as a Director of the Fund
since its inception in 1992. Mr. Bewkes has served as a Director from the
Fund's inception except for a brief period in 1993. Mr. Storms has served on
the Board since May 13, 1999. Each of the other remaining Directors has served
since he or she was first elected to the Board on April 11, 1996. Effective
September 8, 2000, Mary Farrell resigned her position as a Director of the
Fund. A nominee has not yet been selected to fill the vacancy created by her
resignation. If each of the nine nominees is elected, one vacancy will remain
on the Board of Directors of the Fund. Proxies cannot be voted for a greater
number of persons than the number of nominees named. To the Fund's knowledge,
none of the Fund's current Directors and executive officers (19 persons)
beneficially owned any shares of the Fund as of December 31, 2000.
2
<PAGE>
<TABLE>
<CAPTION>
PRESENT POSITION WITH THE
FUND; BUSINESS EXPERIENCE
DURING SHARES OWNED
PAST FIVE YEARS; OTHER BENEFICIALLY ON
NOMINEE; AGE DIRECTORSHIPS DECEMBER 31, 2000**
------------ ------------------------- -------------------
<C> <S> <C>
Margo N. Alexander*; 53 Director. Mrs. Alexander is --
Chairman (since March 1999) and
a director of Mitchell Hutchins
(since January 1995) and an
executive vice president and
director of PaineWebber (since
March 1984). She was chief
executive officer of Mitchell
Hutchins from January 1995 to
October 2000. Mrs. Alexander is
a director or trustee of 30
investment companies for which
Mitchell Hutchins, PaineWebber
or one of their affiliates
serves as investment adviser.
Richard Q. Armstrong; 65 Director. Mr. Armstrong is --
chairman and principal of
R.Q.A. Enterprises (management
consulting firm) (since April
1991 and principal occupation
since March 1995). He is also a
director of AlFresh Beverages
Canada, Inc. (a Canadian
Beverage subsidiary of AlFresh
Foods Inc.) (since October
2000). Mr. Armstrong was
chairman of the board, chief
executive officer and co-owner
of Adirondack Beverages
(producer and distributor of
soft drinks and sparkling/still
waters) (October 1993-March
1995). He was a partner of The
New England Consulting Group
(management consulting firm)
(December 1992-September 1993).
He was managing director of
LVMH U.S. Corporation (U.S.
subsidiary of the French luxury
goods conglomerate, Louis
Vuitton Moet Hennessey
Corporation) (1987-1991) and
chairman of its wine and
spirits subsidiary, Schieffelin
& Somerset Company (1987-1991).
Mr. Armstrong is a director or
trustee of 29 investment
companies for which Mitchell
Hutchins, PaineWebber or one of
their affiliates serves as
investment adviser.
E. Garrett Bewkes, Jr.*; Director and Chairman of the --
74 Board of Directors. Mr. Bewkes
serves as a consultant to
PaineWebber (since May 1999).
Prior to November 2000, he was
a director of Paine Webber
Group Inc. ("PW Group,"
formerly the holding company of
PaineWebber and Mitchell
Hutchins) and prior to 1996, he
was a consultant to PW Group.
Prior to 1988, he was chairman
of the board, president and
chief executive officer of
American Bakeries Company.
Mr. Bewkes is a director of
Interstate Bakeries
Corporation. Mr. Bewkes is a
director or trustee of 40
investment companies for which
Mitchell Hutchins, PaineWebber
or one of their affiliates
serves as investment adviser.
Richard R. Burt; 53 Director. Mr. Burt is chairman --
of IEP Advisors, LLP
(international investments and
consulting firm) (since March
1994) and a partner of McKinsey
& Company (management
</TABLE>
3
<PAGE>
<TABLE>
<CAPTION>
PRESENT POSITION WITH THE
FUND; BUSINESS EXPERIENCE
DURING SHARES OWNED
PAST FIVE YEARS; OTHER BENEFICIALLY ON
NOMINEE; AGE DIRECTORSHIPS DECEMBER 31, 2000**
------------ ------------------------- -------------------
<C> <S> <C>
consulting firm) (since 1991).
He is also a director of
Archer-Daniels-Midland Co.
(agricultural commodities),
Hollinger International Co.
(publishing), Homestake Mining
Corp. (gold mining), six
investment companies in the
Deutsche Bank family of funds,
nine investment companies in
the Flag Investors family of
funds, The Central European
Fund, Inc. and The Germany
Fund, Inc., vice chairman of
Anchor Gaming (provides
technology to gaming and
wagering industry) (since July
1999) and chairman of Weirton
Steel Corp. (makes and finishes
steel products) (since April
1996). He was the chief
negotiator in the Strategic
Arms Reduction Talks with the
former Soviet Union (1989-1991)
and the U.S. Ambassador to the
Federal Republic of Germany
(1985-1989). Mr. Burt is a
director or trustee of 29
investment companies for which
Mitchell Hutchins, PaineWebber
or one of their affiliates
serves as investment adviser.
Meyer Feldberg; 58 Director. Mr. Feldberg is Dean --
and Professor of Management of
the Graduate School of
Business, Columbia University.
Prior to 1989, he was president
of the Illinois Institute of
Technology. Dean Feldberg is
also a director of Primedia
Inc. (publishing), Federated
Department Stores, Inc.
(operator of department stores)
and Revlon, Inc. (cosmetics).
Dean Feldberg is a director or
trustee of 37 investment
companies for which Mitchell
Hutchins, PaineWebber or one of
their affiliates serves an
investment adviser.
George W. Gowen; 71 Director. Mr. Gowen is a --
partner in the law firm of
Dunnington, Bartholow & Miller.
Prior to May 1994, he was a
partner in the law firm of
Fryer, Ross & Gowen. Mr. Gowen
is a director or trustee of 37
investment companies for which
Mitchell Hutchins, PaineWebber
or one of their affiliates
serves as investment adviser.
Frederic V. Malek; 64 Director. Mr. Malek is chairman --
of Thayer Capital Partners
(merchant bank) and chairman of
Thayer Hotel Investors II and
Lodging Opportunities Fund
(hotel investment
partnerships). From January
1992 to November 1992, he was
campaign manager of Bush-Quayle
'92. From 1990 to 1992, he was
vice chairman and, from 1989 to
1990, he was president of
Northwest Airlines Inc. and NWA
Inc. (holding company of
Northwest Airlines Inc.). Prior
to 1989, he was employed by the
Marriott Corporation (hotels,
restaurants, airline catering
and contract feeding), where he
most
</TABLE>
4
<PAGE>
<TABLE>
<CAPTION>
PRESENT POSITION WITH THE
FUND; BUSINESS EXPERIENCE
DURING SHARES OWNED
PAST FIVE YEARS; OTHER BENEFICIALLY ON
NOMINEE; AGE DIRECTORSHIPS DECEMBER 31, 2000**
------------ ------------------------- -------------------
<C> <S> <C>
recently was an executive vice
president and president of
Marriott Hotels and Resorts.
Mr. Malek is also a director of
Aegis Communications, Inc.
(tele-services), American
Management Systems, Inc.
(management consulting and
computer related services),
Automatic Data Processing, Inc.
(computing services), CB
Richard Ellis, Inc. (real
estate services), FPL Group,
Inc. (electric services),
Global Vacation Group (packaged
vacations), HCR/Manor Care,
Inc. (health care), SAGA
Systems, Inc. (software
company) and Northwest Airlines
Inc. Mr. Malek is a director or
trustee of 29 investment
companies for which Mitchell
Hutchins, PaineWebber or one of
their affiliates serves as
investment adviser.
Carl W. Schafer; 65 Director. Mr. Schafer is --
president of the Atlantic
Foundation (charitable
foundation supporting mainly
oceanographic exploration and
research). He is a director of
Labor Ready, Inc. (temporary
employment), Roadway Express,
Inc. (trucking), The Guardian
Group of Mutual Funds, the
Harding, Loevner Funds, E.I.I.
Realty Trust (investment
company), Evans Systems, Inc.
(motor fuels, convenience store
and diversified company),
Electronic Clearing House, Inc.
(financial transactions
processing), Frontier Oil
Corporation and Nutraceutix,
Inc. (biotechnology company).
Prior to January 1993, he was
chairman of the Investment
Advisory Committee of the
Howard Hughes Medical
Institute. Mr. Schafer is a
director or trustee of 29
investment companies for which
Mitchell Hutchins, PaineWebber
or one of their affiliates
serves as an investment
adviser.
Brian M. Storms*; 46 Director and President. Mr. --
Storms is chief executive
officer (since October 2000)
and president of Mitchell
Hutchins (since March 1999).
Mr. Storms was president of
Prudential Investments (1996-
1999). Prior to joining
Prudential he was a managing
director at Fidelity
Investments. Mr. Storms is a
director or trustee of
30 investment companies for
which Mitchell Hutchins,
PaineWebber or one of their
affiliates serves as investment
adviser.
</TABLE>
--------
* Mrs. Alexander, Mr. Bewkes and Mr. Storms are "interested persons" of the
Fund, as defined in the 1940 Act, by virtue of their positions with
Mitchell Hutchins and/or PaineWebber.
** Unless otherwise stated, as of the date indicated, each director had sole
voting and investment power of any shares owned.
5
<PAGE>
The Board of Directors of the Fund met seven times during the fiscal year
ended November 30, 2000. Each Director attended 75% or more of the board
meetings during the last fiscal year. The Board has established an Audit
Committee that acts pursuant to a written charter and is responsible for
overseeing the Fund's accounting and financial reporting policies, practices
and internal controls. A copy of the charter is attached as Exhibit A. In
fulfilling its duties, the Audit Committee has: (a) reviewed and discussed the
Fund's audited financial statements with management; (b) discussed with the
independent auditors the matters required to be discussed by Statement on
Auditing Standards No. 61; (c) received certain written disclosures and the
letter from the independent auditors required by Independence Standards Board
Standard No. 1 and discussed with the independent auditors the independent
auditors' independence; and (d) based upon its review of the above,
recommended to the Board that the audited financial statements be included in
the Fund's annual report to shareholders. The Audit Committee currently
consists of Messrs. Armstrong, Burt, Feldberg, Gowen, Malek and Schafer, none
of whom have any relationship to the Fund that may interfere with the exercise
of their independence from management or the Fund. The Audit Committee members
are independent as defined under listing standards of the New York Stock
Exchange. Each member of the Fund's Audit Committee is also a member of a
similar committee established by the boards of other investment companies for
which Mitchell Hutchins or PaineWebber serves as investment adviser. The Audit
Committee met once during the fiscal year ended November 30, 2000 and each
member attended that meeting.
The Board does not have a standing nominating or compensation committee. The
Fund pays the Independent Directors $1,000 annually and up to $150 for each
Board meeting and for each separate meeting of a Board committee. The chairmen
of the Audit Committees and the audit and contract review committees of
individual funds within the PaineWebber fund complex receive additional
compensation aggregating $15,000 annually from the relevant funds. Directors
of the Fund who are "interested persons" as defined in the 1940 Act receive no
compensation from the Fund. Directors are reimbursed for any expenses incurred
in attending meetings. Each Director will be subject to mandatory retirement
at the end of the year in which he or she becomes 72 years old. The Board has
waived this requirement with respect to Mr. Bewkes for the next year. The
table below includes certain information relating to the compensation of the
Fund's Directors.
COMPENSATION TABLE+
<TABLE>
<CAPTION>
TOTAL
AGGREGATE COMPENSATION
COMPENSATION FROM THE
FROM FUND AND THE
NAME OF PERSON, POSITION THE FUND* FUND COMPLEX**
------------------------ ------------ --------------
<S> <C> <C>
Richard Q. Armstrong, Director...................... $1,780 $108,232
Richard R. Burt, Director........................... $1,780 $108,232
Meyer Feldberg, Director............................ $2,480 $173,982
George W. Gowen, Director........................... $1,780 $173,982
Frederic V. Malek, Director......................... $1,780 $108,232
Carl W. Schafer, Director........................... $1,750 $106,372
</TABLE>
--------
+ Only independent members of the board are compensated by the Fund and
identified above; directors who are "interested persons," as defined by the
1940 Act, do not receive compensation.
* Represents fees paid to each Director during the fiscal year ended November
30, 2000.
** Represents total compensation paid to each Director by 33 investment
companies (37 companies in the case of Messrs. Feldberg and Gowen) for
which Mitchell Hutchins, PaineWebber or one of their affiliates served as
investment adviser during the calendar year ended December 31, 2000. No
fund within the complex has a bonus, pension, profit sharing or retirement
plan.
6
<PAGE>
REQUIRED VOTE
The election of each Director requires approval by a plurality of the votes
cast at the Meeting on the matter, provided a quorum is present.
THE BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE "FOR" EACH NOMINEE IN PROPOSAL
1.
PROPOSAL 2. RATIFICATION OF SELECTION OF INDEPENDENT AUDITORS
The Fund's financial statements for the fiscal year ended November 30, 2000,
were audited by Ernst & Young LLP ("Ernst & Young"), independent auditors. In
addition, Ernst & Young prepares the Fund's federal and state annual income
tax returns.
The Board of Directors of the Fund has selected Ernst & Young as the
independent auditors for the Fund for the fiscal year ending November 30,
2001, subject to ratification by shareholders of the Fund at the Meeting.
Ernst & Young has been the Fund's independent auditors since its inception in
October 1992. The ratification of Ernst & Young as independent auditors is to
be voted upon at the Meeting, and it is intended that the persons named in the
accompanying proxy will vote "FOR" such ratification unless contrary
instructions are given. Ernst & Young has informed the Fund that it has no
material direct or indirect financial interest in the Fund.
Representatives of Ernst & Young are not expected to be present at the
Meeting but have been given the opportunity to make a statement if they so
desire and will be available should any matter arise requiring their presence.
REQUIRED VOTE
The ratification of Ernst & Young as the Fund's independent auditors for the
fiscal year ending November 30, 2001 requires the approval of a majority of
the votes cast at the Meeting on the matter, provided a quorum is present.
THE BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE "FOR" PROPOSAL 2.
PROPOSAL 3. TO APPROVE A SUB-ADVISER APPROVAL POLICY FOR THE FUND
Mitchell Hutchins has been responsible for making the day-to-day portfolio
management decisions for the Fund since it commenced operations. Mitchell
Hutchins also acts as investment adviser or manager for several other
investment companies. In some cases, Mitchell Hutchins does not directly
manage the assets of those other funds but instead appoints another investment
adviser to act as a "sub-adviser." When this occurs, Mitchell Hutchins
continues to serve as investment adviser or manager for the fund, but enters
into a separate agreement with the sub-adviser who then provides the day-to-
day management of all or part of a fund's investments. Occasionally, Mitchell
Hutchins appoints more than one sub-adviser to manage a fund's assets.
Different sub-advisers may have different strengths or contribute in
complementary ways to an investment strategy or program. When Mitchell
Hutchins appoints a sub-adviser, Mitchell Hutchins, not the fund, pays the
sub-advisor a fee for its services.
At its meeting on November 8, 2000, the Board approved, and recommended that
the shareholders of the Fund also be asked to approve, a policy to permit
Mitchell Hutchins, subject to the approval of the Board, to
7
<PAGE>
appoint and replace sub-advisers, to enter into sub-advisory contracts and to
amend sub-advisory contracts on behalf of the Fund subject to ratification and
approval by the Fund's shareholders at the Fund's next regularly scheduled
annual meeting ("Sub-Adviser Approval Policy"). Shareholders are being asked
to approve this policy at the Meeting to permit Mitchell Hutchins to establish
sub-advisory arrangements and to make changes in those arrangements for the
Fund in the future without having to incur the expense of a special
shareholder meeting. If approved by the Fund's shareholders, the policy would
apply only to sub-advisers that are not affiliated with Mitchell Hutchins and
thus would not permit Mitchell Hutchins and the Board to appoint any Mitchell
Hutchins affiliate to serve as sub-adviser to the Fund without shareholder
approval within the more narrow time constraints imposed by the 1940 Act.
Implementation of the Sub-Adviser Approval Policy is subject to the receipt of
an exemptive order that has been requested from the SEC.
THE REQUESTED EXEMPTIVE ORDER
On June 30, 2000, the Fund filed an application ("Exemptive Application")
with the SEC seeking an exemption from provisions of the 1940 Act that,
subject to certain exceptions, prohibit any party from serving as a sub-
adviser to the Fund except pursuant to a contract that has been approved by
the Fund's shareholders. If the Exemptive Application is granted by the SEC,
and if the shareholders approve this proposal, Mitchell Hutchins will be
authorized, subject to approval by the Board, including a majority of the
Independent Directors, to evaluate, select and retain unaffiliated sub-
advisers for the Fund and to modify the sub-advisory contracts without
obtaining immediate shareholder approval. The Fund would announce the
appointment of any sub-advisers by press release promptly following any such
Board action. Moreover, the Exemptive Application would require the Fund to
obtain shareholder ratification and approval of the sub-advisory contracts at
its next regularly scheduled annual meeting. Deferring shareholder approval
until the next annual meeting would allow the Fund to avoid the cost of having
a special shareholder meeting for that purpose. There can be no assurance that
the SEC will grant the relief requested in the Exemptive Application.
CURRENT SUB-ADVISER APPROVAL PROCESS
Currently, if Mitchell Hutchins wanted to retain the services of a sub-
adviser for the Fund, any sub-advisory contract relating to the Fund (between
Mitchell Hutchins and the sub-adviser) must be approved by the holders of a
majority of the Fund's outstanding shares before it can take effect (other
than on an interim basis). Such shareholder approval is in addition to
approval by the Board, including a majority of the Independent Directors.
PROPOSED SUB-ADVISER APPROVAL POLICY
The proposed Sub-Adviser Approval Policy would permit Mitchell Hutchins,
subject to the approval of the Board, including a majority of the Independent
Directors, to appoint and replace sub-advisers and to amend sub-advisory
contracts without obtaining shareholder approval until the next regularly
scheduled annual meeting. The Sub-Adviser Approval Policy thus would permit
Mitchell Hutchins to appoint one or more sub-advisers for the Fund (other than
on an interim basis). It also would permit Mitchell Hutchins to change sub-
advisers or sub-advisory arrangements if, among other things: (1) the sub-
adviser has a record of substandard performance; (2) the individual employees
responsible for portfolio management of the Fund move from the sub-adviser to
another investment advisory firm; (3) there is a change of control of the sub-
adviser; (4) Mitchell Hutchins decides to diversify the Fund's management by
adding another sub-adviser; or (5) there is a change in the investment style
of the Fund. The sub-advisory fee paid by Mitchell Hutchins (not the Fund) to
a sub-adviser can be expected to be lower than the fees paid to Mitchell
Hutchins by the Fund. In the event of a change in sub-advisers, the sub-
advisory fee paid to the new sub-adviser might be lower or higher than the fee
payable to the Fund's sub-adviser being replaced, thereby allowing Mitchell
Hutchins to retain a greater or only a smaller portion of the fees paid
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by the Fund to Mitchell Hutchins. The Sub-Adviser Approval Policy will not be
used to approve any sub-adviser that is affiliated with Mitchell Hutchins, as
that term is used in the 1940 Act, or materially amend any sub-advisory
contract with an affiliated sub-adviser.
Approval of the Sub-Adviser Approval Policy will not affect any of the
requirements under the federal securities laws that govern the Fund, Mitchell
Hutchins, any sub-adviser or any sub-advisory contract, other than the
requirement to call and hold a special meeting of the Fund's shareholders for
the purpose of approving a sub-advisory contract. The Board, including the
Independent Directors, would evaluate and approve all sub-advisory contracts
between Mitchell Hutchins and any sub-adviser as well as all changes to sub-
advisory contracts. In addition, if the SEC grants the requested relief, the
Fund and Mitchell Hutchins will be subject to conditions designed to ensure
that the interests of the Fund's shareholders are adequately protected
whenever Mitchell Hutchins acts under the Sub-Adviser Approval Policy.
Finally, the Fund will be required to announce the appointment of a sub-
adviser by press release promptly following the Board's action, and notice of
the sub-advisory contract, together with a description of the sub-adviser,
would be included in the Fund's next report to shareholders. Shareholders who
are not satisfied with any sub-advisory arrangements that Mitchell Hutchins
and the Board implement under the Sub-Adviser Approval Policy would be able to
vote against the sub-advisory contract at the next annual meeting of
shareholders or, of course, sell their shares.
Shareholder approval of this Proposal 3 will not change the management fees
paid by the Fund to Mitchell Hutchins, nor will it change the duties and
responsibilities of Mitchell Hutchins under its investment advisory and
administration contract with the Fund.
BENEFITS OF THE SUB-ADVISER APPROVAL POLICY
The Board believes that it is in the best interests of the Fund's
shareholders to give Mitchell Hutchins the maximum flexibility to select,
supervise and evaluate sub-advisers without incurring the expense and
potential delay of seeking shareholder approval within a narrow window of time
through a special meeting of Fund shareholders. While Rule 15a-4 under the
1940 Act provides a limited exception to the shareholder approval requirements
for an interim advisory contract, the Fund's current advisory contract must be
terminated before the Rule can apply, and the Fund's shareholders still must
approve both the resulting interim advisory and sub-advisory contracts no
later than 150 days after their effective date. Thus, even when a change in
investment management arrangements involving one or more sub-advisers can be
put into place on a temporary basis, the Fund must promptly call and hold a
special meeting of the Fund's shareholders, create and distribute proxy
materials, and arrange for the solicitation of voting instructions from
shareholders. This process is time-intensive, slow and costly. These costs
generally are borne entirely by the Fund. If Mitchell Hutchins and the Board
can rely on the Sub-Adviser Approval Policy, the Board would be able to act
more quickly and with less expense to appoint an unaffiliated sub-adviser when
the Board and Mitchell Hutchins believe that the appointment would benefit the
Fund and its shareholders.
Also, the Board believes that it is appropriate to vest the selection,
supervision and evaluation of sub-advisers in Mitchell Hutchins, subject to
review by the Board, in light of Mitchell Hutchins' significant experience and
expertise in this area. The Board believes that investors may choose to invest
in the Fund because of Mitchell Hutchins' experience in this respect.
Finally, the Board will oversee the sub-adviser selection process to ensure
that shareholders' interests are protected whenever Mitchell Hutchins selects
a sub-adviser or modifies a sub-advisory contract. The Board, including a
majority of the Independent Directors, would evaluate and approve all sub-
advisory contracts as well as any modification to any sub-advisory contracts
already entered into. In each review, the Board will analyze all factors that
it considers to be relevant to the determination, including the nature,
quality and scope of services
9
<PAGE>
provided by the sub-advisers. The Board will compare the investment
performance of the assets managed by the sub-adviser with other accounts with
similar investment objectives managed by other advisers and will review the
sub-adviser's compliance with federal securities laws and regulations. The
Board believes that its review will ensure that Mitchell Hutchins continues to
act in the best interests of the Fund and its shareholders.
REQUIRED VOTE
Approval of Proposal 3 requires the affirmative vote of the holders of the
lesser of (1) 67% or more of the shares of the Fund present at the Meeting, if
more than 50% of the outstanding shares are represented at the Meeting in
person or by proxy, or (2) more than 50% of the outstanding shares entitled to
vote at the Meeting. If the Fund's shareholders do not approve the proposed
Sub-Adviser Approval Policy, the Fund would be required to call a special
meeting whenever necessary to obtain prompt shareholder approval of any
changes in any sub-advisory arrangements which may be instituted in the
future. Implementation of the Sub-Adviser Approval Policy is also conditioned
upon receipt of the requested exemptive relief from the SEC.
THE BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE "FOR" PROPOSAL 3.
EXECUTIVE OFFICERS
Officers of the Fund are appointed by the Directors and serve at the
pleasure of the Board. None of the Fund's officers currently receives any
compensation from the Fund. The executive officers of the Fund, in addition to
Mr. Storms (about whom information is given previously), are:
THOMAS DISBROW, age 34, vice president and assistant treasurer (appointed
February 2000). Mr. Disbrow is a first vice president and a senior manager
of the mutual fund finance department of Mitchell Hutchins. Prior to
November 1999, he was a vice president of Zweig/Glaser Advisers. Mr.
Disbrow is a vice president and assistant treasurer of 30 investment
companies for which Mitchell Hutchins, PaineWebber or one of their
affiliates serves as investment adviser.
AMY R. DOBERMAN, age 38, vice president of the Fund (appointed September
2000). Ms. Doberman is a senior vice president and general counsel of
Mitchell Hutchins. From December 1996 through July 2000, she was general
counsel of Aeltus Investment Management, Inc. Prior to working at Aeltus,
Ms. Doberman was a Division of Investment Management Chief Counsel at the
Securities and Exchange Commission. Ms. Doberman is a vice president of 29
investment companies and vice president and secretary of one investment
company for which Mitchell Hutchins, PaineWebber or one of their affiliates
serves as investment adviser.
JOHN J. LEE, age 32, vice president and assistant treasurer of the Fund
(appointed May 1998). Mr. Lee is a vice president and a manager of the
mutual fund finance department of Mitchell Hutchins. Prior to September
1997, he was an audit manager in the financial services practice of Ernst &
Young. Mr. Lee is a vice president and assistant treasurer of 30 investment
companies for which Mitchell Hutchins, PaineWebber or one of their
affiliates serves as investment adviser.
KEVIN J. MAHONEY, age 35, vice president and assistant treasurer
(appointed May 1999). Mr. Mahoney is a first vice president and senior
manager of the mutual fund finance department of Mitchell Hutchins. From
August 1996 through March 1999, he was the manager of the mutual fund
internal control group of Salomon Smith Barney. Prior to August 1996, he
was an associate and assistant treasurer for BlackRock Financial Management
L.P. Mr. Mahoney is a vice president and assistant treasurer of 30
investment companies for which Mitchell Hutchins, PaineWebber or one of
their affiliates serves as investment adviser.
10
<PAGE>
ANN E. MORAN, age 43, vice president and assistant treasurer of the Fund
(appointed June 1993). Ms. Moran is a vice president and a manager of the
mutual fund finance department of Mitchell Hutchins. Ms. Moran is a vice
president and assistant treasurer of 30 investment companies for which
Mitchell Hutchins, PaineWebber or one of their affiliates serves as
investment adviser.
DIANNE E. O'DONNELL, age 48, vice president and secretary of the Fund
(appointed February 1992). Ms. O'Donnell is a senior vice president and
deputy general counsel of Mitchell Hutchins. Ms. O'Donnell is a vice
president and secretary of 29 investment companies and a vice president and
assistant secretary of one investment company for which Mitchell Hutchins,
PaineWebber or one of their affiliates serves as investment adviser.
PAUL H. SCHUBERT, age 38, vice president (appointed September 1994) and
treasurer (appointed May 1997) of the Fund. Mr. Schubert is a senior vice
president and the director of the mutual fund finance department of
Mitchell Hutchins. Mr. Schubert is a vice president and treasurer of 30
investment companies for which Mitchell Hutchins, PaineWebber or one of
their affiliates serves as investment adviser.
BARNEY A. TAGLIALATELA, age 39, vice president and assistant treasurer of
the Fund (appointed May 1997). Mr. Taglialatela is a vice president and a
manager of the mutual fund finance department of Mitchell Hutchins. Mr.
Taglialatela is a vice president and assistant treasurer of 30 investment
companies for which Mitchell Hutchins, PaineWebber or one of their
affiliates serves as investment adviser.
STUART WAUGH, age 45, vice president of the Fund (appointed September
1992). Mr. Waugh is a managing director and a portfolio manager of Mitchell
Hutchins responsible for global fixed income investments and currency
trading. Mr. Waugh is a vice president of two investment companies for
which Mitchell Hutchins, PaineWebber or one of their affiliates serves as
investment adviser.
KEITH A. WELLER, age 39, vice president and assistant secretary of the
Fund (appointed September 1995). Mr. Weller is a first vice president and
senior associate general counsel of Mitchell Hutchins. Mr. Weller is a vice
president and assistant secretary of 30 investment companies for which
Mitchell Hutchins, PaineWebber or one of their affiliates serves as
investment adviser.
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
An initial report under Section 16(a) of the Securities Exchange Act of 1934
was not timely filed for Ms. Doberman. This delayed report did not involve any
transaction in the Fund's common stock but rather related to her election as
an officer. The Fund is not aware of any outstanding report required to be
filed by any board member.
SHAREHOLDER PROPOSALS
Any shareholder who wishes to submit proposals to be considered at the
Fund's 2002 annual meeting of shareholders should send such proposals to the
Secretary of the Fund at 1285 Avenue of the Americas, New York, New York
10019-6028. In order to be considered at that meeting, shareholder proposals
must be received by the Fund no later than October 3, 2001 and must satisfy
other requirements of the federal securities laws.
11
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OTHER BUSINESS
Management knows of no business to be presented at the Meeting other than
the matters set forth in this proxy statement, but should any other matter
requiring a vote of shareholders arise, the proxies will vote thereon
according to their best judgment in the interest of the Fund.
By order of the Board of Directors,
DIANNE E. O'DONNELL
Secretary
January 31, 2001
It is important that you execute and return your proxy promptly.
12
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EXHIBIT A
PAINEWEBBER CLOSED-END FUNDS
AUDIT COMMITTEE CHARTER
ESTABLISHMENT AND PURPOSE
The Audit Committee (the "Committee") of the Board of Directors of each of
the closed-end PaineWebber Funds (collectively the "Funds" and, individually,
a "Fund") is hereby established on this the 11th day of May, 2000. The primary
purpose of the Audit Committee is to oversee each Fund's accounting and
financial reporting policies, practices and internal controls, as required by
the statutes and regulations administered by the Securities and Exchange
Commission, including the Investment Company Act of 1940 (the "Act"), and by
the rules of the New York Stock Exchange, Inc. or other relevant securities
exchange on which shares of the Fund are listed.
The Committee will endeavor to assure the quality and objectivity of each
Fund's independent audit and the Fund's financial statements, act as a liaison
between the Board of Directors and each Fund's independent auditors and
periodically report to the Board of Directors. In performing its duties, the
Committee shall have unrestricted access to each Fund's Directors, the
independent auditors, and the executive and financial management of the Fund.
COMPOSITION
The Committee, which will have at least three members at all times, shall be
composed of all the non-interested Directors (as defined in the Act) of each
Fund's Board of Directors, other than those who are not qualified to serve or
who choose not to serve.
Each member of the Committee must meet the independence and experience
requirements set forth in Appendix A. At least one member of each Sub-
Committee must also meet the financial expertise requirements set forth in
Appendix A.
The Committee shall elect a chairman, who shall preside over Committee
meetings (the "Chairman"), and may elect a deputy chairman to preside in the
absence of the Chairman.
SUB-COMMITTEES
The Committee shall have two Audit Sub-Committees (the "Sub-Committees" or,
individually, a "Sub-Committee"). Each member of the Committee shall serve on
one of the two Sub-Committees. Each Sub-Committee shall be assigned the
responsibility of initially performing the Committee's duties with respect to
specific Funds as determined from time to time by the Committee. Each Sub-
Committee shall report its findings and recommendations to the full Committee,
which will retain ultimate responsibility for audit oversight.
Each Sub-Committee shall have a Chairman, one of whom shall also be the
Chairman of the Committee. The other Sub-Committee Chairman shall be elected
by all members of the Committee.
MEETINGS
The Committee and each Sub-Committee shall meet on a regular basis, but not
less frequently than annually. An Agenda shall be established for each
meeting. Special meetings shall be called as circumstances require. The
Chairman of the Committee and each Sub-Committee may invite Fund officers and
other interested parties to
13
<PAGE>
participate in meetings. The Committee and each Sub-Committee may, in its
discretion, meet in executive session outside the presence of Fund officers
and other parties.
A majority of the Committee's and each Sub-Committee's members shall
constitute a quorum. However, if either Sub-Committee does not have a quorum
but a quorum of the Committee as a whole is present, the committee as a whole
may act in the Sub-Committee's place. At any meeting of the Committee or a
Sub-Committee, the decision of a majority of the members present and voting
shall be determinative as to any matter submitted to a vote. Members may
attend telephonically or otherwise whereby they can hear and be heard by all
other attendees.
REPORTING
The Committee Chairman (and, as necessary, the Chairman of any Sub-
Committee) shall report to the Board of Directors on the result of its reviews
and make such recommendations as deemed appropriate. The Committee and each
Sub-Committee will keep minutes of its meetings and will make such minutes
available as requested to the full Board for its review.
DUTIES AND RESPONSIBILITIES
As a general rule, each Fund's independent auditors are ultimately
accountable to the Board of Directors of the Fund and the Committee, and the
Committee and the Board of Directors have the ultimate authority and
responsibility to select, evaluate and, where appropriate, replace the
independent auditors of each Fund, subject to the requirements of the Act. In
addition, the Committee and each designated Sub-Committee shall have the
following specific duties and responsibilities:
Audit Oversight
. In connection with the organization of each Fund and annually
thereafter, recommend to the Board of Directors the selection of an
independent public accounting firm.
. Review the scope of each Fund's proposed audit each year, including the
extent of audit and non-audit services provided to each Fund by the
independent auditors, and the audit procedures to be utilized. At the
conclusion of each audit, the Committee will review the audit, including
any comments or recommendations, with the independent auditors.
. Ensure that the independent auditors for each Fund submit on a periodic
basis to the Committee a formal written statement delineating all
relationships between the auditors and each Fund consistent with
Independence Standards Board Standard No. 1.
. Discuss with the independent auditors any disclosed relationships or
services that may impact the objectivity and independence of the
independent auditors.
. Recommend that the Board of Directors of each Fund take appropriate
action in response to the independent auditors' report to satisfy itself
of, and oversee, the independence of the independent auditors.
. Discuss with Management the performance of the independent auditors,
Management's recommendation with respect to the reasonableness of their
fees and the recommendation to the Board of Directors regarding the
retention of the independent auditors.
. Review and discuss with independent auditors and Management each Fund's
annual report to shareholders and significant accounting policies
underlying the reports and their presentation to the public.
14
<PAGE>
. Discuss with each Fund's independent auditors any matters required to be
discussed pursuant to Statement of Auditing Standards No. 61, as
modified or supplemented.
. Discuss with each Fund's independent auditors, to the extent required by
Statement of Auditing Standards No. 71, any adjustments which were made
to previously reported financial information.
. Review with each Fund's independent auditors the adequacy and
effectiveness of relevant internal controls and procedures and the
quality of the staff implementing these controls and procedures.
. As necessary, review with the independent auditors and Management any
"illegal acts," as defined in Section 10A of the Securities Exchange Act
of 1934 and required by that statute to be reported to the Committee, or
other significant issues that could have a material effect on a Fund's
financial statements.
. Make recommendations to the Board of Directors of each Fund, based on
the Committee's review and discussions with each Fund's independent
auditors and Management, with respect to each Fund's financial
statements as to whether the financial statements should be included in
each Fund's annual report for the previous fiscal year.
Other
. Review with each Fund's Management, investment adviser and, if
applicable, sub-adviser:
(a) such compliance matters as are appropriate to be brought to the
attention of the Committee; and
(b) any comments or criticisms from the staff of the Securities and
Exchange Commission or any other regulators as are appropriate to
be brought to the attention of the Committee.
ANNUAL REVIEW
The Committee shall review and reassess the adequacy of this charter on an
annual basis.
AMENDMENTS
This charter may be amended by a vote of the Board.
LIMITS ON COMMITTEE LIABILITY
Except under extraordinary circumstances, actions taken by the Committee as
a whole shall not subject the Committee members to any personal liability.
The Committee is not responsible for either the preparation of the financial
statements or the auditing of the financial statements. Management of the Fund
has the responsibility for preparing the financial statements and implementing
internal controls and the independent auditors have the responsibility for
auditing the financial statements and monitoring the effectiveness of the
internal controls. The review of the financial statements by the Committee is
not of the same quality as the audit performed by the independent auditors. In
carrying out its responsibilities, the Committee believes its policies and
procedures should remain flexible in order to best react to a changing
environment.
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APPENDIX A
INDEPENDENCE REQUIREMENTS
In order to be deemed independent, each member of the Committee must be free
of any relationships that may interfere with the exercise of his or her
independent judgment. To ensure the independence of each Committee member, the
following restrictions shall apply to each Committee member:
. A Director who is an employee (including non-employee executive
officers) of a Fund or any of its affiliates may not serve on the
Committee until three years following the termination of his or her
employment. In the event the employment relationship is with a former
parent or predecessor of a Fund, the Director could serve on the
Committee after three years following the termination of the
relationship between the Fund and the former parent or predecessor.
. A Director: (a) who is a partner, controlling shareholder, or executive
officer of an organization that has a business relationship with a Fund,
or (b) who has a direct business relationship with a Fund (e.g., a
consultant) may serve on the Committee only if the Board of Directors of
that Fund determines in its business judgment that the relationship does
not interfere with the Director's exercise of independent judgment. In
making a determination regarding the independence of a Director pursuant
to this paragraph, the Board of Directors of the Fund should consider,
among other things, the materiality of the relationship to the Fund, to
the Director, and, if applicable, to the organization with which the
Director is affiliated.
"Business relationship" can include commercial, industrial, banking,
consulting, legal, accounting and other relationships. A Director can
have this relationship directly with the Fund, or the Director can be a
partner, officer or employee of an organization that has such a
relationship. The Director may serve on the Committee without the
above-referenced Board of Directors' determination after three years
following the termination of, as applicable, either: (a) the
relationship between the organization with which the Director is
affiliated and the Fund, (b) the relationship between the Director and
his or her partnership status, shareholder interest or executive
officer position, or (c) the direct business relationship between the
Director and the Fund.
. A Director who is employed as an executive of another corporation where
a Fund's executives serve on that corporation's compensation committee
may not serve on the Committee.
. A Director who is an "Immediate Family" member (as this term is defined
in Rule 303.02(A) of the NYSE Listed Company Manual) of an individual
who is an executive officer of a Fund or any of its affiliates cannot
serve on the Committee until three years following the termination of
such employment relationship.
EXCEPTIONS
One Independent Director who does not meet the independence requirements
above, and is not a current employee or an immediate family member of such an
employee, may be appointed as a member of the Committee, if the Boards of
Directors of the PaineWebber Funds, under exceptional and limited
circumstances, determines that his or her membership on the Committee is
required by the best interests of the Funds and their shareholders, and the
Boards disclose, in the next annual proxy statement for each closed-end Fund
subsequent to the person's appointment, the nature of the relationship and the
reasons why the person was appointed to the Committee.
16
<PAGE>
EXPERIENCE REQUIREMENTS
Each member of the Committee must be "financially literate." A member of the
Committee will be deemed to be "financially literate" if he or she is able to
read and understand financial statements, including, but not limited to, the
Funds' balance sheets, income statements, and cash flow statements, or will
become able to do so within a reasonable time after becoming a member of the
Committee.
FINANCIAL EXPERTISE REQUIREMENTS
At least one member of each Sub-Committee must have past employment
experience in finance or accounting, requisite professional certification in
accounting, or any comparable experience or background which would result in
the individual's financial sophistication, including being or having been a
chief executive officer, chief financial officer or other senior officer with
financial oversight responsibilities.
17
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-----------------------------
STRATEGIC GLOBAL
INCOME FUND, INC.
-----------------------------
PROXY
STATEMENT
-----------------------------
STRATEGIC GLOBAL
INCOME FUND, INC.
-----------------------------
------------------
NOTICE OF
ANNUAL MEETING
TO BE HELD ON
MARCH 15, 2001
AND
PROXY STATEMENT
------------------
<PAGE>
PROXY
STRATEGIC GLOBAL INCOME FUND, INC.
Annual Meeting of Shareholders - March 15, 2001
The undersigned hereby appoints as proxies Keith Weller and Marissa Duran-
Cruz and each of them (with power of substitution) to vote for the undersigned
all shares of common stock of the undersigned at the aforesaid meeting and any
adjournment thereof with all the power the undersigned would have if personally
present. The shares represented by this proxy will be voted as instructed.
Unless indicated to the contrary, this proxy shall be deemed to grant authority
to vote "FOR" all proposals. THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF
DIRECTORS OF STRATEGIC GLOBAL INCOME FUND, INC.
YOUR VOTE IS IMPORTANT
Please date and sign this proxy on the reverse side and return it in the
enclosed envelope to: PFPC Inc., P.O. Box 9388, Boston, MA 02205-9966. PFPC
Inc. has been engaged to forward the enclosed proxy material and to tabulate
proxies returned by mail.
SEE REVERSE SEE REVERSE
SIDE SIDE
CONTINUED AND TO BE SIGNED ON REVERSE SIDE
<PAGE>
Please mark
[X] votes as in
this example.
The Board of Directors recommends a vote "FOR"
<TABLE>
<S> <C>
1. To elect as Directors: 2. To ratify the selection FOR AGAINST ABSTAIN
(01) Margo N. Alexander, (02) Richard Q. of Ernst & Young LLP as the [ ] [ ] [ ]
Armstrong, (03) E. Garrett Bewkes, Jr., (04) Fund's independent auditors
Richard R. Burt, (05) Meyer Feldberg, (06) for the fiscal year ending
George W. Gowen, (07) Frederic V. Malek, November 30, 2001.
(08) Carl W. Schafer, (09) Brian M. Storms.
FOR ALL WITHHELD FROM 3. To approve a sub-adviser FOR AGAINST ABSTAIN
NOMINEES [ ] [ ] ALL NOMINEES approval policy for the Fund. [ ] [ ] [ ]
[ ] FOR ALL NOMINEES EXCEPT:
-----------------------------------------
</TABLE>
MARK HERE FOR ADDRESS CHANGE AND NOTE AT LEFT
This proxy will not be voted unless it is
dated and signed exactly as instructed below:
If shares are held by an individual, sign
your name exactly as it appears on this card.
If shares are held jointly, either party may
sign, but the name of the party signing
should conform exactly to the name shown on
this proxy card. If shares are held by a
corporation, partnership or similar account,
the name and the capacity of the individual
signing the proxy card should be indicated
unless it is reflected in the form of
registration. For example: "ABC Corp., John
Doe, Treasurer."
Sign exactly as name appears hereon.
------------------------------ --------------------------------------------
Signature Date Signature Date
