<PAGE>
SCHEDULE 14A INFORMATION
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:
/ / 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 240.14a-11(c) or 240.14a-12
THE BRAZILIAN 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:
------------------------------------------------------------------------
<PAGE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
THE BRAZILIAN EQUITY FUND, INC.
ONE CITICORP CENTER
153 EAST 53RD STREET
57TH FLOOR
NEW YORK, NEW YORK 10022
-------------------
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD ON WEDNESDAY, JULY 22, 1998
-----------------
TO THE SHAREHOLDERS OF
THE BRAZILIAN EQUITY FUND, INC.
NOTICE IS HEREBY GIVEN that the annual meeting of shareholders of The
Brazilian Equity Fund, Inc. (the "Fund") will be held at the offices of Willkie
Farr & Gallagher, 787 Seventh Avenue, 38th Floor, New York, New York 10019, on
Wednesday, July 22, 1998 commencing at 10:00 a.m. The purpose of the meeting is
to consider and act upon the following proposals and to consider and act upon
such other matters as may properly come before the meeting or any adjournments
thereof:
(1) To elect four (4) directors of the Fund.
(2) To ratify the selection of Coopers & Lybrand L.L.P. as independent
public accountants of the Fund for the fiscal year ending March 31,
1999.
(3) To consider a shareholder proposal to terminate the investment
advisory agreement with BEA Associates and to have the Board of
Directors consider soliciting competitive proposals for a new
investment advisor.
The close of business on May 26, 1998 has been fixed as the record date for
the determination of the shareholders entitled to notice of, and to vote at, the
meeting.
This notice and related proxy material are first being mailed on or about
June 9, 1998.
By order of the Board of Directors,
/s/ Michael A. Pignataro
MICHAEL A. PIGNATARO
SECRETARY
IF YOU DO NOT EXPECT TO ATTEND THE MEETING IN PERSON AND WISH YOUR SHARES TO BE
VOTED, PLEASE COMPLETE, SIGN AND DATE THE PROXY CARD AND RETURN IT IN THE
ENCLOSED ENVELOPE. NO POSTAGE IS REQUIRED IF MAILED IN THE UNITED STATES. IT IS
IMPORTANT THAT YOUR PROXY CARD BE RETURNED PROMPTLY IN ORDER TO AVOID THE
ADDITIONAL EXPENSE OF FURTHER SOLICITATION.
Dated: June 9, 1998
New York, New York
<PAGE>
THE BRAZILIAN EQUITY FUND, INC.
ONE CITICORP CENTER
153 EAST 53RD STREET
57TH FLOOR
NEW YORK, NEW YORK 10022
-------------------
PROXY STATEMENT FOR THE
ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD ON WEDNESDAY, JULY 22, 1998
-----------------
This Proxy Statement is furnished in connection with a solicitation of
proxies by the Board of Directors (the "Board") of The Brazilian Equity Fund,
Inc. (the "Fund") for use at the Annual Meeting of Shareholders to be held at
the offices of Willkie Farr & Gallagher, 38th Floor, 787 Seventh Avenue, New
York, New York 10019 on Wednesday, July 22, 1998 (commencing at 10:00 a.m.) and
at any adjournments thereof (collectively, the "Meeting"). A Notice of Annual
Meeting of Shareholders and a proxy card (the "Proxy") accompany this Proxy
Statement. Proxy solicitations will be made primarily by mail, but solicitations
may also be made by telephone, telegraph or personal interviews conducted by
officers or employees of the Fund, BEA Associates, the investment adviser to the
Fund ("BEA"), Bear Stearns Funds Management Inc., the administrator of the Fund
(the "U.S. Administrator"), or MacKenzie Partners Inc. ("MacKenzie"), a proxy
solicitation firm that has been retained by the Fund and which will receive a
fee of approximately $3,500 and will be reimbursed for its reasonable expenses.
All costs of solicitation, including (a) printing and mailing of this Proxy
Statement and accompanying material, (b) the reimbursement of brokerage firms
and others for their expenses in forwarding solicitation material to the
beneficial owners of the Fund's shares, (c) payment of MacKenzie for its
services in soliciting Proxies and (d) supplementary solicitations to submit
Proxies, will be borne by the Fund. This Proxy Statement is expected to be
mailed to shareholders on or about June 9, 1998.
The principal executive office of BEA is One Citicorp Center, 153 East 53rd
Street, 57th Floor, New York, New York 10022. The U.S. Administrator has its
principal executive office at 245 Park Avenue, 15th Floor, New York, New York
10167. BankBoston, N.A., Sao Paulo (the "Brazilian Administrator"), located at
Rua Libero Badaro, 487, Centro Piso 12, Sao Paulo 01009, Brazil, serves as
Brazilian administrator of the Fund.
The Fund's Annual Report containing audited financial statements for the
fiscal year ended March 31, 1998 has been previously furnished to all
shareholders of the Fund. It is not to be regarded as proxy-soliciting material.
If the enclosed Proxy is properly executed and returned in time to be voted
at the Meeting, the shares represented thereby will be voted in accordance with
the instructions marked on the Proxy. If no instructions are marked on the
Proxy, the Proxy will be voted FOR election of the nominees for director, FOR
the ratification of the selection of Coopers & Lybrand L.L.P. as independent
public accountants of the Fund for the fiscal year ending March 31, 1999,
AGAINST the shareholder proposal to terminate the investment advisory agreement
with BEA (the "Investment Advisory Agreement"), and FOR any other matters that
1
<PAGE>
may properly come before the Meeting and that are deemed appropriate. Any
shareholder giving a Proxy has the right to attend the Meeting to vote his
shares in person (thereby revoking any prior Proxy) and also the right to revoke
the Proxy at any time by written notice received by the Fund prior to the time
it is voted.
In the event that 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. If a quorum is
present, the persons named as proxies will vote those Proxies that they are
entitled to vote FOR any proposal in favor of an adjournment and will vote those
Proxies required to be voted AGAINST any such proposal against any adjournment.
A shareholder vote may be taken on one or more of the proposals in the Proxy
Statement prior to any adjournment if sufficient votes have been received and it
is otherwise appropriate. A quorum of shareholders is constituted by the
presence in person or by proxy of the holders of a majority of the outstanding
shares of the Fund entitled to vote at the Meeting. For purposes of determining
the presence of a quorum for transacting business at the Meeting, abstentions
and broker "non-votes" (that is, proxies from brokers or nominees indicating
that such persons have not received instructions from the beneficial owner or
other persons entitled to vote shares on a particular matter with respect to
which the brokers or nominees do not have discretionary power) will be treated
as shares that are present but which have not been voted.
Proposal 1 requires for approval the affirmative vote of a plurality of the
votes cast at the Meeting in person or by proxy, Proposal 2 requires for
approval the vote of a "majority" of the votes cast at the Meeting in person or
by proxy and Proposal 3 requires for approval the vote of a "majority" of the
outstanding voting Shares (defined below) of the Fund. "Majority" (as defined in
the Investment Company Act of 1940, as amended (the "1940 Act")) means the
lesser of (a) 67% or more of the Shares of the Fund present at the Meeting if
the holders of more than 50% of the outstanding Shares of the Fund are present
in person or by proxy, or (b) more than 50% of the outstanding Shares of the
Fund. Because abstentions and broker non-votes are not treated as shares voted,
any abstentions and broker non-votes would have no impact on Proposals 1 and 2
and would have the same effect as a vote AGAINST Proposal No. 3.
The Fund has one class of shares of capital stock, par value $0.001 per
share (the "Shares"). On the record date, May 26, 1998, there were 6,564,841
Shares outstanding. Each Share is entitled to one vote at the Meeting, and
fractional Shares are entitled to proportionate shares of one vote.
In order that your Shares may be represented at the Meeting, you are
requested to:
--indicate your instructions on the Proxy;
--date and sign the Proxy;
--mail the Proxy promptly in the enclosed envelope;
--allow sufficient time for the Proxy to be received and processed on or
before 10:00 a.m. on July 22, 1998.
PROPOSAL 1: ELECTION OF DIRECTORS
The first proposal to be submitted at the Meeting will be the election of
four (4) directors of the Fund, each to hold office for such term set forth
below and until his successor is elected and qualified.
2
<PAGE>
The Board is divided into three classes, each class having a term of no more
than three years. Each year the term of office of one class expires and the
successor or successors elected to such class will serve for a three-year term.
Enrique R. Arzac and George W. Landau, directors whose current terms expire
on the date of this Meeting, have been nominated for a three-year term to expire
at the 2001 annual meeting. Dr. Arzac has been a member of the Board of
Directors of the Fund since 1996, and Mr. Landau has been a member of the Board
since the Fund commenced operations in 1992. If elected, each of Messrs. Arzac
and Landau will serve until the 2001 annual meeting and until his successor is
duly elected and qualified.
On May 22, 1998, the directors increased the size of the Board to nine and
Messrs. Richard J. Herring and Robert J. McGuire were elected to fill the
newly-created vacancies. The election of Messrs. Herring and McGuire is now
being submitted to the Fund's shareholders for their approval. If elected, Mr.
Herring will serve until the 2001 annual meeting and until his successor is duly
elected and qualified. If elected, Mr. McGuire will serve until the 1999 annual
meeting and until his successor is duly elected and qualified.
Each nominee has indicated an intention to continue to serve if elected and
has consented to being named in this Proxy Statement. Each nominee or director
named below who is deemed an "interested person" of the Fund, as defined in the
1940 Act, is indicated by an asterisk. Messrs. Priest and Watt are interested
persons of the Fund by virtue of their positions as directors and/or officers of
BEA.
The following table sets forth certain information regarding the nominees
for election to the Board of the Fund, directors whose terms of office continue
beyond the 1998 Meeting, and the officers and directors of the Fund as a group.
Each of the nominees, directors and officers of the Fund has sole voting and
investment power with respect to the Shares shown. Each nominee, each director
and the officers and directors of the Fund as a group owns less than one percent
of the outstanding Shares of the Fund.
<TABLE>
<CAPTION>
MEMBERSHIPS ON
BOARDS OF OTHER
SHARES LENGTH OF SERVICE REGISTERED
BENEFICIALLY AS DIRECTOR AND INVESTMENT
OWNED ON CURRENT PRINCIPAL OCCUPATION TERM OF MEMBERSHIP COMPANIES AND
MAY 26, AND PRINCIPAL EMPLOYMENT ON BOARD OF THE PUBLICLY HELD
NAME (AGE) 1998 DURING THE PAST FIVE YEARS FUND COMPANIES
- --------------------------- ----------- ------------------------------------ ------------------ ------------------
<S> <C> <C> <C> <C>
Enrique R. Arzac (56) ..... 566 Professor of Finance and Economics, Since 1996; cur- Director of nine
Columbia University Graduate School of Business, Colum- rent term ends at other BEA-advised
Graduate School of bia University (1971-present). the 1998 annual investment compa-
Business meeting. nies; Director of
New York, NY 10027 The Adam Express
Company; Director
of Petroleum and
Resources Corpo-
ration.
</TABLE>
3
<PAGE>
<TABLE>
<CAPTION>
MEMBERSHIPS ON
BOARDS OF OTHER
SHARES LENGTH OF SERVICE REGISTERED
BENEFICIALLY AS DIRECTOR AND INVESTMENT
OWNED ON CURRENT PRINCIPAL OCCUPATION TERM OF MEMBERSHIP COMPANIES AND
MAY 26, AND PRINCIPAL EMPLOYMENT ON BOARD OF THE PUBLICLY HELD
NAME (AGE) 1998 DURING THE PAST FIVE YEARS FUND COMPANIES
- --------------------------- ----------- ------------------------------------ ------------------ ------------------
<S> <C> <C> <C> <C>
James J. Cattano (54) ..... 100 President, Primary Resource Inc. (an Since 1992; cur- Director of six
78 Manor Road international trading company rent term ends at other BEA-advised
Ridgefield, CT 06877 specializing in the sale of agricul- the 1999 annual investment compa-
tural commodities in Latin American meeting. nies.
markets) (10/96-present); Presi-
dent, Atlantic Fertilizer & Chemical
Company (an international trading
company specializing in the sale of
agricultural commodities in Latin
American markets) (10/91-10/96).
Peter A. Gordon (55) ...... 0 Currently retired; General Partner Since 1994; cur- Director of five
284 Coopers Neck Lane of Ethos Capital Management rent term ends at other BEA-advised
P.O. Box 1327 (6/92-12/95); Managing Director at the 2000 annual investment
Southampton, NY 11968 Salomon Brothers Inc (1981-6/92). meeting. companies; Direc-
tor of TCS Fund,
Inc.; Director of
the Mills Corpo-
ration.
Richard J. Herring (52) ... 0 Jacob Safra Professor of Interna- Since 5/22/98; Director of BT
325 S. Roberts Rd. tional Banking and Finance and Vice current term ends Institutional
Box 768 Dean, Wharton Undergraduate at the 1998 annu- Funds and BT
Bryn Mawr, PA 19010 Division, The Wharton School, al meeting. Advisor Funds.
University of Pennsylvania
(1972-present).
George W. Landau (78) ..... 1,666 Senior Advisor, Latin America Group, Since 1992; cur- Director of six
Two Grove Isle Drive The Coca-Cola Company rent term ends at other BEA-advised
Coconut Grove, FL 33133 (1988-present); President of the the 1998 annual investment compa-
Americas Society and Council of the meeting. nies; Director of
Americas (7/85-10/93); United States Emigrant Savings
Ambassador to Venezuela (1982-1985); Bank; Director of
United States Ambassador to Chile GAM Funds, Inc.
(1977-1982) and United States
Ambassador to Paraguay (1972-1977).
Robert J. McGuire (61) .... 0 Of Counsel, Morvillo, Abramowitz, Since 5/22/98; Director of GAM
565 5th Avenue Graud, Iason & Silberberg, P.C. current term ends Funds, Inc.
9th Floor (1998-present); President and Chief at the 1998 annu-
New York, NY 10017 Operating Officer of Kroll Associ- al meeting.
ates (1989-1997).
William W. Priest, Jr.* 0 Chairman-Management Committee, Chief Since 1997; cur- Director of ten
(56) Executive Officer and Executive rent term ends at other BEA-advised
153 East 53rd Street Director of BEA (12/90-present). the 1999 annual investment compa-
New York, NY 10022 meeting. nies.
</TABLE>
4
<PAGE>
<TABLE>
<CAPTION>
MEMBERSHIPS ON
BOARDS OF OTHER
SHARES LENGTH OF SERVICE REGISTERED
BENEFICIALLY AS DIRECTOR AND INVESTMENT
OWNED ON CURRENT PRINCIPAL OCCUPATION TERM OF MEMBERSHIP COMPANIES AND
MAY 26, AND PRINCIPAL EMPLOYMENT ON BOARD OF THE PUBLICLY HELD
NAME (AGE) 1998 DURING THE PAST FIVE YEARS FUND COMPANIES
- --------------------------- ----------- ------------------------------------ ------------------ ------------------
<S> <C> <C> <C> <C>
Martin M. Torino (48) ..... 0 Chairman of the Board of Ingenio y Since 1992; cur- Director of five
Reconquista 365, 9th Fl. Refineria San Martin Del Tabacal rent term ends at other BEA-advised
Capital Federal 1003 S.A. (8/96-present); Executive Di- the 2000 annual investment compa-
Buenos Aires, Argentina rector of TAU S.A. (a commodities meeting. nies.
trading firm, 11/90-present); Presi-
dent of DYAT S.A. (10/93-present).
Richard W. Watt* (39) ..... 4,130 Managing Director of BEA Since 1995; cur- Director of seven
153 East 53rd Street (7/96-present); Senior Vice Presi- rent term ends at other BEA-advised
New York, NY 10022 dent of BEA (8/95-6/96); Head of the 2000 annual investment compa-
Emerging Markets Investments and meeting. nies.
Research at Gartmore Investment
Limited (11/92-6/95); Director of
Kleinwort Benson International In-
vestment (5/87-10/92).
All directors and officers
(14 persons, including
the foregoing) as a
group.................... 6,462
</TABLE>
- --------------
*Messrs. Priest and Watt are interested persons of the Fund by virtue of their
positions as directors and/or officers of BEA.
During the fiscal year ended March 31, 1998, each director who is not a
director, officer, partner, co-partner or employee of BEA, the U.S.
Administrator, the Brazilian Administrator or any affiliate thereof, received an
annual fee of $5,000 and $500 for each meeting of the Board attended by him and
was reimbursed for expenses incurred in connection with his attendance at the
Board meetings. The total remuneration paid by the Fund during the fiscal year
ended March 31, 1998 to all such unaffiliated directors was $34,500. During the
fiscal year ended March 31, 1998, the Board convened six times. Each director
except Mr. Gordon attended at least seventy-five percent of the aggregate number
of meetings of the Board and any committee on which he served held during the
period for which he was a director.
Messrs. Arzac, Cattano, Gordon, Landau and Torino constitute the Fund's
Audit Committee, which is composed of directors who are non-interested persons
of the Fund (as this term is defined in the 1940 Act) (the "Non-interested
Directors"). The Audit Committee met twice during the fiscal year ended March
31, 1998. The Audit Committee advises the full Board with respect to accounting,
auditing and financial matters affecting the Fund. The Board performs the
functions of a nominating committee. The Board of Directors of the Fund will
consider nominees recommended by shareholders in the event any vacancies arise.
Recommendations should be submitted to the Board care of the Secretary of the
Fund. The Fund does not have a compensation committee.
Section 16(a) of the Securities Exchange Act of 1934 and Section 30(f) of
the 1940 Act require the Fund's officers and directors, officers and directors
of the investment adviser, affiliated persons of the investment adviser, and
persons who beneficially own more than ten percent of the Fund's Shares, to file
reports of ownership with the Securities and Exchange Commission, the New York
Stock Exchange and the
5
<PAGE>
Fund. Based solely upon its review of the copies of such forms received by it
and written representations from such persons, the Fund believes that, for the
fiscal year ended March 31, 1998, all filing requirements applicable to such
persons were complied with.
LEGAL PROCEEDINGS
BEA, the Fund (as nominal defendant), and certain current and previous
directors of the Fund, including Messrs. Arzac and Landau, who have been
nominated to stand for re-election to the Board at the Meeting, have been named
in a derivative and purported class action filed in the United States District
Court for the Southern District of New York (the "District Court"). ROBERT
STROUGO, ON BEHALF OF THE BRAZILIAN EQUITY FUND, INC. V. EMILIO BASSINI, ET AL.,
97 Civ. 3579 (RWS) (the "Strougo Litigation").
The action, which commenced in May of 1997, arises out of the Fund's 1996
rights offering. Plaintiff maintains that, in approving the rights offering, the
director defendants put the interests of BEA ahead of the interests of the
shareholders. By allegedly favoring BEA, plaintiff claims that the directors
breached their fiduciary duties of loyalty and due care to the shareholders of
the Fund under the 1940 Act and at common law. The action also alleges that the
Fund was injured by defendants' actions and that asking the director defendants
to sue themselves would be futile. The class action claims include similar
assertions, but allege that the Fund's shareholders were injured directly. The
complaint seeks equitable relief and monetary damages in an unspecified amount.
By Opinion and Order dated April 6, 1998, the District Court granted a
motion to dismiss the complaint in its entirety as to the class action claims
and denied the motion to dismiss as to all other claims. On May 22, 1998, the
directors created a special litigation committee of the Board composed of two
newly-appointed disinterested directors who are not named parties in the STROUGO
Litigation for the purpose of considering the allegations raised in the Strougo
Litigation.
In an unrelated legal matter, BEA (but not the Fund or its directors) has
been named in an action filed on or about May 21, 1998 in the District Court by
the same plaintiff and the same counsel as in the Strougo Litigation. ROBERT
STROUGO V. BEA ASSOCIATES, 98 Civ. 3725.
In this action, which is brought pursuant to Section 36(b) under the 1940
Act, the plaintiff claims that the Investment Advisory Agreement was not
negotiated at arms' length and properly approved by the Non-interested Directors
of the Board, as required by Section 15(c) of the 1940 Act. In support of his
allegations, the plaintiff maintains that the Non-interested Directors of the
Fund are beholden to the interests of BEA and not independent, in violation of
the 40% Non-interested Director requirement of the 1940 Act. The plaintiff
argues that as a consequence the Investment Advisory Agreement is invalid and
that the advisory fees received by BEA thereunder were wrongly received. The
plaintiff seeks a judgment declaring the Investment Advisory Agreement void AB
INITIO and recovering the investment advisory fees paid by the Fund to BEA
pursuant to the Investment Advisory Agreement during the one year period prior
to the commencement of the action.
The defendants in each of these actions believe they have meritorious
defenses and intend to defend them vigorously. Under the Investment Advisory
Agreement, BEA, under certain circumstances, may have rights of indemnity
against the Fund for any losses or expenses incurred in connection with these
actions.
EXECUTIVE OFFICERS
The following table shows certain information about officers of the Fund
other than Messrs. Priest and Watt, who are described above. Mr. Priest is
Chairman of the Board of the Fund and was appointed to such position on February
11, 1997. Mr. Watt is President and Chief Investment Officer of the Fund. Mr.
Watt was appointed President of the Fund on February 11, 1997, having previously
served as Senior Vice President of the Fund since August 15, 1995. Mr. Watt has
been Chief Investment Officer of the Fund since August 15, 1995. Ms. Setnicka
was appointed to her position as Treasurer on August 12, 1997, having been
previously the Assistant Treasurer since May 1996. Mr. Pignataro has been an
officer since the commencement of the Fund's operations. On August 12, 1997, Mr.
Liebes was elected Senior Vice President and Mr. Del Guercio
6
<PAGE>
was elected Vice President of the Fund. Emily Alejos was elected as the
Investment Officer on November 4, 1997. Each officer of the Fund will hold
office until a successor has been elected by the Board. All officers of the Fund
are employees of and are compensated by BEA.
<TABLE>
<CAPTION>
SHARES
BENEFICIALLY
OWNED ON CURRENT PRINCIPAL OCCUPATION AND PRINCIPAL
NAME AGE MAY 26, 1998 POSITION WITH FUND EMPLOYMENT DURING THE PAST FIVE YEARS
- ------------------------------ --- --------------- ----------------------- --------------------------------------------
<S> <C> <C> <C> <C>
Hal Liebes ................... 33 0 Senior Vice President Senior Vice President and General Counsel of
153 East 53rd Street BEA (3/97-present); Vice President and Legal
New York, NY 10022 Counsel for BEA (6/95-3/97); Chief
Compliance Officer, CS First Boston Invest-
ment Management (94-95); Staff Attorney,
Division of Enforcement, U.S. Securities and
Exchange Commission (91-94); Associate,
Morgan, Lewis & Bockius (89-91).
Michael A. Pignataro ......... 38 0 Chief Financial Officer Vice President of BEA (12/95-present); As-
153 East 53rd Street and Secretary sistant Vice President and Chief Administra-
New York, NY 10022 tive Officer for Investment Companies of BEA
(9/89-12/95).
Rocco A. Del Guercio ......... 35 0 Vice President Administrative Officer for BEA-advised
153 East 53rd Street investment companies (6/96-present); Assis-
New York, NY 10022 tant Treasurer, Bankers Trust Corp.-Fund
Administration (3/94-6/96); Mutual Fund
Accounting Supervisor, Dreyfus Corporation
(4/87-3/94).
Wendy S. Setnicka ............ 33 0 Treasurer Assistant Vice President of BEA
153 East 53rd Street (1/97-present); Administrative Officer for
New York, NY 10022 Investment Companies of BEA (11/93-pres-
ent); Supervisor of Fund Accounting and
Administration at Reich & Tang LP
(6/89-11/93).
Emily Alejos ................. 34 0 Investment Officer Vice President of BEA (4/97-present); Vice
153 East 53rd Street President of Bankers Trust (8/93-3/97).
New York, NY 10022
</TABLE>
The following table shows certain compensation information for the directors
of the Fund for the fiscal year ended March 31, 1998. None of the Fund's
executive officers or directors who are also officers or directors of BEA
received any compensation from the Fund for such period. The Fund has no bonus,
profit sharing, pension or retirement plans.
<TABLE>
<CAPTION>
PENSION OR
RETIREMENT TOTAL TOTAL NUMBER
BENEFITS ESTIMATED COMPENSATION FROM OF BOARDS OF
ACCRUED AS ANNUAL FUND AND BEA-ADVISED
AGGREGATE PART OF BENEFITS FUND COMPLEX INVESTMENT
COMPENSATION FUND UPON PAID TO COMPANIES
NAME OF DIRECTOR FROM FUND EXPENSES RETIREMENT DIRECTORS SERVED
- ------------------------------ ----------------- ---------- ---------- ----------------- ------------
<S> <C> <C> <C> <C> <C>
Dr. Enrique R. Arzac ......... $ 7,000 0 0 $94,500 10
James J. Cattano ............. $ 7,000 0 0 $54,500 7
Peter A. Gordon .............. $ 6,500 0 0 $45,500 6
George W. Landau ............. $ 7,000 0 0 $55,000 7
Martin M. Torino ............. $ 7,000 0 0 $46,000 6
</TABLE>
THE BOARD OF DIRECTORS, INCLUDING THE NON-INTERESTED DIRECTORS, RECOMMENDS THAT
THE SHAREHOLDERS VOTE "FOR" THE NOMINEES FOR DIRECTOR.
7
<PAGE>
PROPOSAL 2: RATIFICATION OR REJECTION OF
INDEPENDENT PUBLIC ACCOUNTANTS
The second proposal to be submitted at the Meeting will be the ratification
or rejection of the selection by the Board of Coopers & Lybrand L.L.P. as
independent public accountants of the Fund for the fiscal year ending March 31,
1999. At a meeting held on May 12, 1998, the Board, including Non-interested
Directors, approved the selection of Coopers & Lybrand L.L.P. for the fiscal
year ending March 31, 1999. Coopers & Lybrand L.L.P. has been the Fund's
independent public accountants since the Fund commenced operations in 1992, and
has informed the Fund that it has no material direct or indirect financial
interest in the Fund. A representative of Coopers & Lybrand L.L.P. will be
available by telephone at the Meeting and will have the opportunity to make a
statement if the representative so desires and will be available to respond to
appropriate questions.
THE BOARD OF DIRECTORS, INCLUDING THE NON-INTERESTED DIRECTORS, RECOMMENDS THAT
THE SHAREHOLDERS VOTE "FOR" THE RATIFICATION OF COOPERS & LYBRAND L.L.P. AS
INDEPENDENT PUBLIC ACCOUNTANTS.
PROPOSAL 3: SHAREHOLDER PROPOSAL
The Fund has received the following proposal and supporting statement from
Mr. Ronald G. Olin, who has advised the Fund that he owns 1,197 Shares of the
Fund. The Fund will provide the address of Mr. Olin to any person who so
requests such information orally or in writing, promptly upon the receipt of any
oral or written request therefor, to BEA at 153 East 53rd Street, 57th Floor,
New York, New York 10022. The Board and the Fund accept no responsibility for
the accuracy of either the proposal or Mr. Olin's supporting statement. For the
reasons set forth in detail in the Opposing Statement of the Board of Directors,
which follows Mr. Olin's Supporting Statement, the Board of Directors recommends
a vote AGAINST this shareholder proposal. The text of the shareholder proposal
and supporting statement is as follows:
"RESOLVED: The Fund's investment advisory agreement with its investment
advisor ("BEA") shall be terminated and the board shall consider soliciting
competitive proposals for a new investment advisor.
SUPPORTING STATEMENT
"I believe BEA's advisory contract should be terminated because shareholder
results with the Fund have been very poor compared to the Brazil market, and
because management fees are so lucrative to BEA that effective steps to enhance
shareholder value are not taken.
"The Fund's shareholders paid $69 million to buy newly issued shares of the
Fund at inception in April 1992. Since then, shareholders received $29 million
in distributions, bought $22 million in additional new shares, and had an
investment worth $81 million in market value on 12/26/97 for a resulting gain of
just $19 million. According to the total investment return figures reported to
the SEC through 9/30/97, which do not reflect commissions or initial
underwriting discounts, the Fund's return from inception is +57%. While
investment results may be affected because it is not subject to the same
investment policies and restrictions as the Fund, the "unmanaged" MSCI index of
Brazilian Securities increased 210% in dollar terms during this same period.
"Shareholders have paid about $15 million in fees and other expenses. The
market discount of the Fund's shares on 12/26/97 represented an ADDITIONAL $15
million in lost shareholder value.
"After 25 years as a private investor and 10 additional years as an
investment professional managing up to $200 million in closed-end fund shares, I
am convinced that the biggest problem in fixing discounts and adding market
value is the advisory contract. It is so lucrative that the fund manager will
rarely recommend more than token steps to enhance shareholder value. I believe
the Directors owe their positions to BEA and therefore will not take effective
actions such as massive share buy-backs, tender offers, or open-endings. Such
steps would reduce the Fund size and the advisory fees paid to BEA.
8
<PAGE>
"The discount results from supply/demand imbalance. Massive buy-backs would
increase the Net Asset Value of each of the Fund's remaining shares and likely
reduce the discount. A small increase in expense ratio is well worth it. Such
buybacks would provide shareholders significant added return without added risk,
but they are unlikely to happen because they reduce advisory fees. Instead, this
Fund conducted a rights offering and sold new shares at a discount which diluted
the asset value of the shares and increased the advisory fees paid to BEA.
"It is prohibitively expensive and time consuming for shareholders to wage
successful proxy fights to replace staggered Boards of Directors hand picked by
the investment advisor. Fortunately, the Investment Company Act gives
shareholders one practical tool--a majority can vote to "fire" the investment
manager. BEA and the Directors tried unsuccessfully to prevent you from seeing
this shareholder resolution and its supporting statement.
"The advisory contract is valuable. Qualified advisors can be easily found
that will work with a motivated Board to enhance shareholder value.
"We have a chance to send a loud and clear message to the Board that we want
the Fund run exclusively for the benefit of the Fund's owners. Vote for this
SHAREHOLDER sponsored resolution."
OPPOSING STATEMENT OF THE BOARD OF DIRECTORS
THE BOARD OF DIRECTORS UNANIMOUSLY OPPOSES THE PROPOSAL DESCRIBED ABOVE AND
STRONGLY URGES ALL SHAREHOLDERS TO VOTE AGAINST THE PROPOSAL FOR THE REASONS
NOTED BELOW.
On May 12, 1998, the Board unanimously resolved to recommend that you vote
AGAINST this Proposal. As required under the 1940 Act, the Board and the
Non-interested Directors recently approved the continuation of the Investment
Advisory Agreement with BEA after concluding, upon review of relevant
information made available to them pursuant to the 1940 Act, that such
continuation was in the best interest of the Fund. In addition, the full Board
and the Non-interested Directors do not believe that the continuation of the
Investment Advisory Agreement in any way precludes consideration and adoption by
the Board of appropriate actions designed to address the market discount issue,
although there is no guarantee that any such action will be taken, or that, if
it is taken, such action will be successful.
In the statement supporting his proposal, Mr. Olin states that BEA and the
directors of the Fund "unsuccessfully tried to prevent you from seeing [his]
proposal and its supporting statement." The Board and the Non-interested
Directors wish to point out that their action with respect to Mr. Olin's
proposal was limited to challenging an EARLIER VERSION of the proposal and
statement on various technical and accuracy grounds, strictly in accordance with
applicable law and established precedents. The Commission's staff agreed that
certain aspects of Mr. Olin's original proposal and statement had to be changed
or could be omitted in accordance with the 1940 Act. Mr. Olin's revised proposal
and statement, which were changed to reflect the staff's views (including the
staff's view that certain portions of the original statement could be viewed as
potentially false or misleading), has been included in its entirety in this
proxy statement.
CONTINUATION OF THE INVESTMENT ADVISORY AGREEMENT
At a meeting held on November 4, 1997, the full Board, and the
Non-interested Directors voting separately, unanimously approved the
continuation of the Investment Advisory Agreement with BEA. They do not believe
that there has been any subsequent change in the facts upon which their decision
was premised which would now warrant terminating BEA.
As required by Section 15 of the 1940 Act, advisory contracts must be
approved annually by the Board (including a majority of the Non-interested
Directors) or a majority of the outstanding voting securities of an investment
company. Section 15(c) of the 1940 Act charges the directors with the duty to
review such information as may reasonably be necessary to evaluate the terms of
the advisory contract. In anticipation of
9
<PAGE>
the November 4th meeting and in accordance with its well-established practice,
BEA provided the directors with extensive information so as to enable the
directors to satisfy their duty to conduct a meaningful evaluation of the
Investment Advisory Agreement before deciding whether to approve its
continuation. This information included, among other things, (i) a description
of the business, operations and investment philosophy relating to BEA, as well
as certain financial information of BEA, (ii) an analysis of the profitability
to BEA of the Investment Advisory Agreement, (iii) a comparison of the
performance of the Fund with that of other BEA-managed funds, other registered
and unregistered investment companies within the Fund's peer group and relevant
stock indices, (iv) financial information relating to the Fund, including total
return and market price data for the Fund's Shares, (v) data regarding fees paid
by other BEA clients, and (vi) a comparison of the expense ratio and advisory
fee level of the Fund with those of its peer group.
After finding, among other things, that (i) BEA's compensation is at a level
comparable to similarly-situated funds, (ii) the Fund's performance is within
the range of performance that may reasonably be expected of a fund with an
investment strategy such as that of the Fund, and (iii) BEA and the personnel
assigned to the Fund have the requisite experience and skill to manage the Fund
in accordance with its investment objectives and policies, the directors,
including the Non-interested Directors, concluded that the continuation of the
Investment Advisory Agreement was in the best interest of the Shareholders of
the Fund. The directors reached this determination in the exercise of their
business judgment as part of their lawful authority over the Fund's business
affairs under Maryland law.
The Board and the Non-interested Directors do not believe that there has
been any change in the facts upon which their decision to continue the
Investment Advisory Agreement was premised that would now warrant terminating
BEA. For example, the statement supporting Mr. Olin's proposal compares the
Fund's performance and that of the Morgan Stanley Capital International
Brazilian Equity Market Index (the "MSCI Index"), an unmanaged index, based on
market prices, which is one of the performance comparisons that the Board has
also considered. Mr. Olin's supporting statement fails to note, however, that
the composition of the MSCI Index reflects that of the main Brazilian stock
market, which is heavily weighted in a small number of Brazilian "blue chip"
companies, whereas the Fund, in accordance with the Internal Revenue Code
diversification requirements, must diversify its investments into a broader
asset base. These "blue chip" companies have accounted for much of the MSCI
Index's performance in the period since the Fund's inception. Available
information shows that the Fund's performance continues to be within an
acceptable range. The Fund's return to shareholders, based on net asset value
(assuming reinvestment of dividends and distributions), was 11.66% for the year
ended December 31, 1997, as reported by Lipper Analytical Services.
Mr. Olin indicates in his supporting statement that "shareholders have paid
about $15 million in fees and other expenses." Mr. Olin's fails to note,
however, that such fees and expenses are comparable to those paid by
similarly-situated funds regardless of the identity of their service providers.
The Board and the Non-interested Directors believe that the recent results
of the Fund, which are driven in large part by market trends, do not modify the
conclusions upon which their decision to continue the Investment Advisory
Agreement was premised in November, 1997. Therefore, the Board and the Non-
interested Directors determined at a meeting held on May 12, 1998 to recommend
that Shareholders vote AGAINST the termination of the Investment Advisory
Agreement.
It is important to note that seven of the nine directors of the Fund qualify
as Non-interested Directors under the 1940 Act, which is a much higher
percentage of Non-interested Directors than is required under the 1940 Act.
Moreover, all the directors of the Fund are elected by the shareholders at
shareholder meetings. Accordingly, the implication in Mr. Olin's supporting
statement that the directors "owe their positions to" the investment adviser is
not accurate. The directors owe their positions and fiduciary duties to the
shareholders that elected them, and their actions throughout their terms have
been focused upon fulfilling their independent obligations to the Shareholders.
10
<PAGE>
MARKET DISCOUNT AND REMEDIAL ACTIONS
Mr. Olin's proposal to submit to the vote of the Shareholders of the Fund a
resolution to terminate the Investment Advisory Agreement with BEA appears to be
premised upon the belief that such termination would enhance the Board's
willingness to take actions expected to reduce the discount at which Shares of
the Fund are currently trading on the New York Stock Exchange, Inc. The Board
and the Non-interested Directors do not believe that the termination of the
Investment Advisory Agreement is a necessary prerequisite to consideration and
adoption of any such actions by the Board. While they recognize the importance
of protecting the value of the Shareholders' interest in the Fund, the Board and
the Non-interested Directors do not believe that the actions suggested by Mr.
Olin, namely buy-backs, tender offers and open-ending the Fund, are appropriate
at this time.
The directors and the Non-interested Directors monitor the Fund's market
discount and analyze available remedial actions on an on-going basis. Market
discounts occur when the market value of a publicly traded closed-end fund share
is less than its underlying net asset value. Shares of the Fund, like shares of
many other closed-end funds, have been trading at significant market discounts
for quite some time. Because the discount is a market-wide phenomenon, driven
largely by market forces, there are limits to what can be done, although certain
actions are often presented as potential remedies to market discount.
Mr. Olin argues that removing BEA might introduce circumstances that could
lead to a greater willingness to consider buy-backs, tender offers or the
open-ending of the Fund. Based on analysis which they have already performed,
the directors and the Non-interested Directors believe for the reasons stated
below that buy-backs and tender offers would not constitute a definitive
solution to the market discount and that the benefits to Shareholders of the
closed-end status of the Fund currently continue to outweigh the advantages
which an open-ended structure would procure.
BUY-BACKS AND TENDER OFFERS. Buy-backs and tender offers have been
suggested as a means to reduce the size of the Fund by decreasing the
outstanding shares of the Fund which in turn "capture" the discount for the
remaining investors. Buy-backs and tender offers might also temporarily reduce
the discount by increasing market demand for Fund shares. Buy-backs and tender
offers, however, have not been shown to effectively address the discount issue
other than on a short-term basis. The Board has analyzed buy-backs and tenders
offers done by other closed-end funds in an attempt to narrow the discount. The
Board's review has shown that while the discount often narrows in the midst of
the buy-back or tender offer, when the buy-back or tender offer is complete the
discount returns and persists. These strategies tend to benefit short-term
investors far more than, and sometimes to the detriment of, long-term investors.
OPEN-ENDING THE FUND. Converting the Fund into an "open-end fund," commonly
known as a mutual fund, would permit Shareholders to redeem Shares at net asset
value upon request. Although open-ending the Fund would undoubtedly eliminate
the discount, the Board and the Non-interested Directors believe that the
Shareholders derive many benefits from the Fund's closed-end structure. This
structure allows BEA to concentrate on managing a stable pool of assets, without
the need to keep assets in low-yielding cash or to liquidate assets, sometimes
at inopportune times, to meet redemption requests. The closed-end structure also
allows the investment managers to buy more illiquid holdings, such as private
equities, which can benefit Fund performance. Open-ending the Fund also would
require the Board to consider whether and how to spend the Fund's money to
market the Fund's Shares, which would affect the Fund's performance. If the
Board decides not to spend the Fund's money on marketing the Shares, redemptions
could shrink the Fund's asset base to the point where its expense ratio
increases, simply because fixed expenses are spread across a smaller asset base.
For now, the Board and the Non-interested Directors continue to be guided by the
principles upon which the Fund was established, and which caused investors to
buy the Fund in the first place. Open-ending the Fund would fundamentally change
its character in ways that the Board and the Non-interested Directors do not
believe are in the best interests of the Shareholders at this time.
Although the Board and the Non-interested Directors will continue to assess
the merits of open-ending the Fund, there are some less drastic steps that the
Fund can take, and has taken, to reduce the discount.
11
<PAGE>
Chief among these has been the greater effort to increase the Fund's visibility
in the investment community. In this regard, the Fund's portfolio managers have
been meeting with analysts and institutional investors to ensure that the
investment community has access to important information about the Fund and its
investments. The Fund is now also publishing net asset values daily (instead of
weekly) to give all Shareholders current and immediate valuation information.
Daily net asset values are available by calling the Fund at 1-800-293-1232 or by
visiting the BEA Funds' Website (WWW.BEAFUNDS.COM). Management of BEA is
expanding the Website to include reasonably current portfolio information
on-line. We believe these steps are likely to increase potential investor demand
generally for Shares of the Fund.
As summarized above, the Board and the Non-interested Directors are working
in cooperation with BEA towards enhancing shareholder value and will continue to
study other steps towards reducing the discount. The Board and the
Non-interested Directors do not believe that termination of the Investment
Advisory Agreement is a prerequisite to these efforts and therefore urge
stockholders to vote AGAINST the shareholder proposal.
THE BOARD, INCLUDING THE NON-INTERESTED DIRECTORS, RECOMMENDS THAT THE
SHAREHOLDERS VOTE "AGAINST" THE SHAREHOLDER PROPOSAL
OTHER MATTERS WHICH MAY COME BEFORE THE MEETING;
SHAREHOLDER PROPOSALS
The Board is not aware of any other matters that will come before the
Meeting. Should any other matter properly come before the Meeting, it is the
intention of the persons named in the accompanying Proxy to vote the Proxy in
accordance with their judgment on such matters.
Notice is hereby given that for a shareholder proposal to be considered for
inclusion in the Fund's proxy materials relating to its 1999 annual meeting of
shareholders, the shareholder proposal must be received by the Fund no later
than February 9, 1999. The shareholder proposal, including any accompanying
supporting statement, may not exceed 500 words. A shareholder desiring to submit
a proposal must be a record or beneficial owner of Shares with a market value of
$2,000 and must have held such Shares for at least one year. Further, the
shareholder must continue to hold such Shares through the date on which the
meeting is held. Documentary support regarding the foregoing must be provided
along with the proposal. There are additional requirements regarding proposals
of shareholders, and a shareholder contemplating submission of a proposal is
referred to Rule 14a-8 promulgated under the Securities Exchange Act of 1934.
Pursuant to the Bylaws of the Fund, at any annual meeting of the
shareholders, only such business will be conducted as has been properly brought
before the annual meeting. To be properly brought before the annual meeting, the
business must be (i) specified in the notice of meeting (or any supplement
thereto) given by or at the direction of the Board, (ii) otherwise properly
brought before the meeting by or at the direction of the Board, or (iii)
otherwise properly brought before the meeting by a shareholder.
For business to be properly brought before the annual meeting by a
shareholder, the shareholder must have given timely notice thereof in writing to
the Secretary of the Fund. To be timely, any such notice must be delivered to or
mailed and received at The Brazilian Equity Fund, Inc. c/o BEA, 153 E. 53rd
Street, 57th Floor, New York, NY 10022 not later than 60 days prior to the date
of the meeting; provided, however, that if less than 70 days' notice or prior
public disclosure of the date of the meeting is given or made to shareholders,
any such notice by a shareholder to be timely must be so received not later than
the close of business on the 10th day following the day on which notice of the
date of the annual meeting was given or such public disclosure was made.
Any such notice by a shareholder must set forth as to each matter the
shareholder proposes to bring before the annual meeting (i) a brief description
of the business desired to be brought before the annual meeting and the reasons
for conducting such business at the annual meeting, (ii) the name and address,
as they appear on the Fund's books, of the shareholder proposing such business,
(iii) the class and number of Shares of the capital stock of the Fund which are
beneficially owned by the shareholder, and (iv) any material interest of the
shareholder in such business.
SHAREHOLDERS WHO DO NOT EXPECT TO BE PRESENT AT THE MEETING AND WHO WISH TO HAVE
THEIR SHARES VOTED ARE REQUESTED TO DATE AND SIGN THE ENCLOSED PROXY AND RETURN
IT IN THE ENCLOSED ENVELOPE. NO POSTAGE IS REQUIRED IF MAILED IN THE UNITED
STATES.
ADDITIONAL INFORMATION
BENEFICIAL OWNERS
The following table shows certain information concerning persons who may be
deemed beneficial owners of 5% or more of the Shares of the Fund because they
possessed or shared voting or investment power with respect to the Shares of the
Fund.
<TABLE>
<CAPTION>
NUMBER OF
SHARES
BENEFICIALLY PERCENT
NAME AND ADDRESS OWNED OF SHARES
- -------------------------------------------------- ------------- ----------
<S> <C> <C>
*President and Fellows of Harvard College ........ 537,739 8.2%
c/o Harvard Management Company, Inc.
600 Atlantic Avenue
Boston, MA 02210
</TABLE>
- --------------
* As stated in a Schedule 13G filed with the Securities and Exchange Commission.
REPORTS TO SHAREHOLDERS
The Fund sends unaudited semi-annual and audited annual reports to its
shareholders, including a list of investments held. THE FUND WILL FURNISH,
WITHOUT CHARGE, A COPY OF ITS MOST RECENT ANNUAL AND SEMI-ANNUAL REPORTS, UPON
REQUEST TO THE FUND AT ONE CITICORP CENTER, 153 EAST 53RD STREET, NEW YORK, NEW
YORK 10022, TELEPHONE (1-800-293-1232). THESE REQUESTS WILL BE HONORED WITHIN
THREE BUSINESS DAYS OF RECEIPT.
12
<PAGE>
THE BRAZILIAN EQUITY FUND, INC.
3910-PS-7/98
<PAGE>
THE BRAZILIAN EQUITY FUND, INC.
This Proxy is Solicited on Behalf of the Board of Directors
P The undersigned hereby appoints Messrs. Michael A. Pignataro and
Rocco A. Del Guercio as Proxies, each with the power to appoint his
R substitute, and hereby authorizes them to represent and to vote, as
designated on the reverse side and in accordance with their judgment on
O such other matters as may properly come before the meeting or any
adjournments thereof, all shares of The Brazilian Equity Fund, Inc.
X (the "Fund") that the undersigned is entitled to vote at the annual
meeting of shareholders to be held on Wednesday, July 22, 1998, and at
Y any adjournments thereof.
-------------
CONTINUED AND TO BE SIGNED ON REVERSE SIDE /SEE REVERSE/
/ SIDE /
-------------
<PAGE>
-----
/ / Please mark
/ X / votes as in
/ / this example.
-----
This proxy when properly executed will be voted in the manner directed
herein by the undersigned shareholder. If no direction is made, this proxy
will be voted for Proposals 1 and 2 and against Proposal 3.
The Board of Directors recommends a vote "FOR" the nominees in Proposal 1,
"FOR" Proposal 2 and "AGAINST" Proposal 3.
OP
<TABLE>
<S> <C> <C> <C> <C>
1. ELECTION OF THE FOLLOWING NOMINEES AS 2. TO RATIFY THE SELECTION OF FOR AGAINST ABSTAIN
DIRECTORS: COOPERS & LYBRAND L.L.P. AS ------- ------- -------
(three-year terms): Enrique R. Arzac INDEPENDENT PUBLIC ACCOUNTANTS / / / / / /
George W. Landau OF THE FUND FOR THE FISCAL / / / / / /
Richard J. Herring YEAR ENDING MARCH 31, 1999. ------- ------- -------
(one year term): Robert J. McGuire
FOR WITHHELD
ALL NOMINEES FROM ALL NOMINEES 3. TO TERMINATE THE INVESTMENT FOR AGAINST ABSTAIN
------- ------- ADVISORY AGREEMENT WITH BEA ------- ------- -------
/ / / / ASSOCIATES AND HAVE THE BOARD / / / / / /
/ / / / OF DIRECTORS OF THE FUND / / / / / /
------- ------- CONSIDER SOLICITING COMPETITIVE ------- ------- -------
PROPOSALS FOR A NEW INVESTMENT
ADVISOR.
------
/ /
/ /
--------------------------------------------
For all nominees except as noted above
</TABLE>
MARK HERE ------
FOR ADDRESS / /
CHANGE AND / /
NOTE AT LEFT ------
PLEASE MARK, SIGN, DATE AND RETURN THIS PROXY CARD
PROMPTLY USING THE ENCLOSED ENVELOPE.
Please sign exactly as name appears at left. When
shares are held by joint tenants, both should sign.
When signing as attorney, executor, administrator,
trustee or guardian, please give full title as such.
If a corporation, please sign in full corporate name
by president or other authorized officer. If a
partnership, please sign in partnership name by
authorized person.
Signature:_______________ Date:______ Signature:_______________ Date:______
