<PAGE>
<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 Commission Only
(as permitted by
Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
WARBURG, PINCUS POST-VENTURE CAPITAL FUND, INC.
- ------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- ------------------------------------------------------------------------------
(Name of Person(s) filing Proxy Statement, if other than Registrant)
Payment of Filing Fee (Check the appropriate box):
[ ] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), or
14a-6(i)(2) or Item 22(a)(2) of Schedule 14A.
[ ] $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
[ ] 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:
<PAGE>
<PAGE>
(5) Total fee paid:
[X] 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, of 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>
<PAGE>
WARBURG, PINCUS POST-VENTURE CAPITAL FUND, INC.
466 LEXINGTON AVENUE
NEW YORK, NEW YORK 10017-3147
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
MAY 10, 1996
Dear Shareholders:
A special meeting of the shareholders of the Warburg, Pincus Post-Venture
Capital Fund, Inc. (the 'Fund') will be held on Friday, May 10, 1996, at 3:00
p.m., Eastern Time, at the offices of the Fund, 466 Lexington Avenue, New York,
New York 10017-3147 (10th Floor), or any adjournment thereof, for the following
purposes:
(1) To approve or disapprove the Sub-Investment Advisory Agreement
(the 'Sub-Advisory Agreement') among the Fund, Warburg, Pincus Counsellors,
Inc. ('Warburg') and Abbott Capital Management, L.P. ('Abbott') with
respect to the Fund; and
(2) To transact such other business as may properly come before the
meeting.
Approval of the Sub-Advisory Agreement will allow the Fund to utilize the
extensive experience of Abbott in investing in private investment vehicles that
themselves invest in companies in the venture capital and post-venture capital
stages of development or companies engaged in special situations or changes in
corporate control. Warburg will pay a sub-advisory fee to Abbott out of its own
assets, so that APPROVAL OF THE SUB-ADVISORY AGREEMENT WILL NOT INCREASE THE
TOTAL FEES AND EXPENSES OF FUND SHAREHOLDERS. THE BOARD OF DIRECTORS OF THE FUND
UNANIMOUSLY RECOMMENDS THAT YOU VOTE FOR APPROVAL OF THE SUB-ADVISORY AGREEMENT.
You are entitled to vote at the meeting and any adjournments thereof if you
owned shares of the Fund at the close of business on March 1, 1996. 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 in
the enclosed postage paid envelope.
By Order of the Board of Directors,
EUGENE P. GRACE
Vice President and Secretary
March 12, 1996
THE FUND WILL FURNISH, WITHOUT CHARGE, A COPY OF ITS MOST RECENT ANNUAL
REPORT TO A SHAREHOLDER UPON REQUEST. ANY SUCH REQUEST SHOULD BE DIRECTED TO THE
FUND BY CALLING (800) 888-6878 OR BY WRITING TO THE FUND, 466 LEXINGTON AVENUE,
NEW YORK, NEW YORK 10017-3147.
IN ORDER TO AVOID THE ADDITIONAL EXPENSE OF FURTHER SOLICITATION, WE ASK
THAT YOU MAIL YOUR PROXY PROMPTLY NO MATTER HOW MANY SHARES YOU OWN.
YOUR VOTE IS IMPORTANT.
<PAGE>
<PAGE>
WARBURG, PINCUS POST-VENTURE CAPITAL FUND, INC.
466 LEXINGTON AVENUE
NEW YORK, NEW YORK 10017-3147
---------------
PROXY STATEMENT
---------------
SPECIAL MEETING OF SHAREHOLDERS TO BE HELD ON
MAY 10, 1996
This document is a proxy statement for Warburg, Pincus Post-Venture Capital
Fund, Inc. (the 'Fund'), an open-end mutual fund having two classes of common
stock. This proxy statement, which will be mailed to Shareholders on or about
March 12, 1996, is furnished in connection with the solicitation of proxies by
the Board of Directors of the Fund (the 'Board') to be used at the Fund's
Special Meeting of Shareholders (the 'Meeting'). The Meeting will be held on
Friday, May 10, 1996, at 3:00 p.m., Eastern Time, at the offices of the Fund,
466 Lexington Avenue, New York, New York 10017-3147 (10th floor), for the
purposes set forth in the Notice of the Meeting.
The proxies named on the proxy card will vote in accordance with the
directions indicated thereon if your proxy card is received properly executed.
If you properly execute your proxy card and give no voting instruction, your
shares will be voted FOR the proposal set forth herein. Abstentions will be
counted as present for purposes of determining a quorum, but will not be counted
as voting. Broker non-votes (i.e., proxies from brokers or nominees indicating
that such persons have not received instructions from the beneficial owner or
other persons entitled to vote the shares on a particular matter with respect to
which the broker or nominees do not have discretionary power) will be treated
the same as abstentions. Proxies may be revoked at any time prior to their
exercise by execution of a subsequent proxy card, by written notice to the
Secretary of the Fund or by voting in person at the Meeting.
Approval of the proposal set forth herein will require the affirmative vote
of a majority of the outstanding shares of the Fund, voting in the aggregate
without regard to class, in person or by proxy, if a quorum is present. In the
event that a quorum is present at the Meeting but sufficient votes to approve a
proposal 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 costs of the Meeting (estimated at $25,000 including the solicitation
of proxies) will be paid by the Fund. The principal solicitation of proxies will
be by the mailing of this proxy statement, but proxies may also be solicited by
telephone and/or in person by representatives of the Fund and regular employees
of Warburg, Pincus Counsellors, Inc. ('Warburg') or its affiliate(s). Such
representatives and employees will not receive additional compensation for
solicitation activities. The Fund has retained the services of D.F. King & Co.,
Inc. to assist in the solicitation of proxies. For its services, D.F. King &
Co., Inc. will be paid a fee by the Fund expected to equal approximately $7,500.
Each full share outstanding is entitled to one vote and each fractional
share outstanding is entitled to a proportionate share of one vote. As of March
1, 1996, the Fund had outstanding 4,039,120.550 Common Shares and 119.212
Advisor Shares. The persons who owned more than 5% of any class of the Fund's
outstanding shares as of March 1, 1996, to the knowledge of the Fund, are set
forth in APPENDIX A hereto.
PROPOSAL -- APPROVAL OF SUB-INVESTMENT ADVISORY AGREEMENT
The shareholders of the Fund will be asked at the Meeting to approve a
Sub-Investment Advisory Agreement (the 'Sub-Advisory Agreement') among the Fund,
Warburg and Abbott Capital Management, L.P. ('Abbott') with respect to the Fund.
The Sub-Advisory Agreement was unanimously approved by the Board, including all
of the Directors who are not parties to the Sub-Advisory Agreement or interested
persons of such parties ('independent directors'), at a meeting held on February
8, 1996. Warburg, as investment adviser to the Fund, had recommended to the
Board that the Fund retain Abbott to serve as the sub-investment adviser for the
Fund. Warburg's principal office is
<PAGE>
<PAGE>
located at 466 Lexington Avenue, New York, New York 10017-3147, and Abbott's
principal office is located at 50 Rowes Wharf, Suite 240, Boston, Massachusetts
02110-3328. A form of the Sub-Advisory Agreement among the Fund, Warburg and
Abbott is attached as APPENDIX B. THE SUB-ADVISORY AGREEMENT WILL NOT IN ANY
MANNER INCREASE THE FEES OTHERWISE INCURRED BY FUND SHAREHOLDERS.
The Fund commenced investment operations on September 29, 1995 with Warburg
serving as the Fund's investment adviser from that date. The Fund focuses its
investments on equity securities of post-venture capital companies, as described
more fully in its Prospectus. Warburg believes that it would be advantageous to
invest a portion of the Fund's assets in private investment vehicles that
themselves invest in companies in the venture capital and post-venture capital
stages of development or companies engaged in special situations or changes in
corporate control, including buyouts. Because this is an area in which Abbott
has extensive experience, Warburg recommended that the Fund retain Abbott as
sub-investment adviser. Warburg will monitor the activities and performance of
Abbott and may, in its discretion, increase or decrease the portion of the
Fund's assets allocated to Abbott for investment. The Fund has determined
initially that Warburg may allocate up to 10% of the Fund's assets to Abbott,
which can be changed by the Board at any time. The fee paid to Abbott will be
paid by Warburg out of its own assets.
The Fund's other service agreements will not be affected by the
Sub-Advisory Agreement. Currently, the Fund employs as co-administrators
Counsellors Funds Service, Inc. ('Counsellors') and PFPC Inc. ('PFPC').
Counsellors' address is 466 Lexington Avenue, New York, New York 10017-3147.
PFPC has its principal offices at 400 Bellevue Parkway, Wilmington, Delaware
19809. The Fund employs PNC Bank, National Association ('PNC') as custodian of
the Fund's U.S. assets and State Street Bank and Trust Company ('State Street')
as custodian of the Fund's non-U.S. assets. PNC's principal business address is
Broad and Chestnut Streets, Philadelphia, Pennsylvania 19101. State Street's
principal business address is 225 Franklin Street, Boston, Massachusetts 02110.
The Fund employs Counsellors Securities Inc., a subsidiary of Warburg, as
distributor of the shares of the Fund.
The Sub-Advisory Agreement as approved by the Board is now being submitted
for approval by the shareholders of the Fund. If it is approved by a Majority
Vote of the outstanding shares of the Fund, it will continue in effect for an
initial term ending April 17, 1997, and will continue from year to year
thereafter, subject to approval annually by the Board or by a Majority Vote of
the outstanding shares of the Fund, and also, in either event, approval by a
majority of the independent directors who are not parties to the Sub-Advisory
Agreement or interested persons (as defined in the Investment Company Act of
1940, as amended (the '1940 Act')) of any such party at a meeting called for the
purpose of voting on such approval. 'Majority Vote' for purposes of this proxy
statement, and under the 1940 Act, means the lesser of (i) 67% of the shares
represented at a meeting at which more than 50% of the outstanding shares of the
Fund are represented or (ii) more than 50% of the outstanding shares of the
Fund. If the shareholders of the Fund should fail to approve the Sub-Advisory
Agreement, the Board shall consider appropriate action with respect to such
non-approval of the Sub-Advisory Agreement.
INVESTMENT ADVISORY AGREEMENT
Warburg, a professional investment counselling firm, serves as the Fund's
investment adviser. Incorporated in 1970, Warburg is a wholly owned subsidiary
of Warburg, Pincus Counsellors, G.P. ('Counsellors G.P.'), a New York general
partnership. E.M. Warburg, Pincus & Co., Inc. controls Warburg through its
ownership of a class of voting preferred stock of Warburg. Counsellors G.P. has
no business other than being a holding company of Warburg and its subsidiaries.
Pursuant to the Investment Advisory Agreement between Warburg and the Fund,
dated September 29, 1995 (the 'Advisory Agreement'), and subject to the
supervision and direction of the Board, Warburg is responsible for managing the
Fund in accordance with the Fund's stated investment objective and policies. As
compensation for its services to the Fund, Warburg receives compensation at the
annual rate of 1.25% of the average daily net assets of the Fund. For the fiscal
period ended October 31, 1995, Warburg earned, and voluntarily waived, $1,756,
the full amount due it under the Advisory Agreement. WHETHER THE SUB-ADVISORY
AGREEMENT IS APPROVED OR NOT, WARBURG WILL CONTINUE TO SERVE AS INVESTMENT
ADVISER TO THE FUND PURSUANT TO THE ADVISORY AGREEMENT.
2
<PAGE>
<PAGE>
Warburg is responsible for providing investment advisory services as well
as a continual program of investment, evaluation and, if appropriate, sale and
reinvestment of the Fund's assets. In addition to expenses that Warburg may
incur in performing its services under the Advisory Agreement, Warburg pays the
compensation, fees and related expenses of all Directors of the Fund who are
affiliated persons of Warburg or any of its subsidiaries and, if the
Sub-Advisory Agreement is approved by shareholders, will pay a sub-advisory fee
to Abbott. The Fund pays all other expenses incurred in its operation, including
general administrative expenses.
SUB-ADVISORY AGREEMENT
If the Sub-Advisory Agreement with Abbott is approved by a Majority Vote of
the Fund's outstanding shares, Abbott will become the sub-adviser of the Fund.
The services of Abbott under the Sub-Advisory Agreement are not exclusive,
however. Abbott has the right to provide similar services to other investment
companies or to engage in other activities, provided that those activities do
not adversely affect Abbott's ability to perform its services under this
Sub-Advisory Agreement.
Subject to the supervision of Warburg, the Sub-Advisory Agreement requires
Abbott, in the exercise of its best judgment, to provide investment advisory
assistance and portfolio management advice to the Fund in accordance with (a)
the Fund's Articles of Incorporation, (b) the 1940 Act and the Investment
Advisers Act of 1940, as amended (the 'Advisers Act'), and all applicable Rules
and Regulations of the Securities and Exchange Commission (the 'SEC') and all
other applicable laws and regulations and (c) the Fund's investment objective
and policies as stated in the prospectuses (the 'Prospectuses') and Statement of
Additional Information (the 'SAI') and investment parameters provided by Warburg
from time to time.
In connection with the Sub-Advisory Agreement, Abbott will:
(i) determine whether to purchase, retain or sell interests in United
States or foreign private investment vehicles that themselves invest in
debt and equity securities of companies in the venture capital and
post-venture capital stages of development or companies engaged in special
situations or changes in corporate control, including buy-outs
('Investments'). Abbott may execute, or place orders for the execution of,
all Investments on behalf of the Fund;
(ii) assist the custodian and accounting agent for the Fund in
determining or confirming, consistent with the procedures and policies
stated in the Prospectuses and SAI, the value of any Investments for which
the custodian and accounting agent seek assistance from or identify for
review by Abbott;
(iii) monitor the execution of orders for the purchase or sale of
Investments and the settlement and clearance of those orders;
(iv) exercise voting rights in respect of Investments; and
(v) provide reports to the Board for consideration at quarterly
meetings of the Board on the Investments and furnish Warburg and the Board
with such periodic and special reports as the Fund or Warburg may
reasonably request.
In connection with the performance of the services of Abbott as provided
for in the Sub-Advisory Agreement, Abbott may contract at its own expense with
third parties for the acquisition of research, clerical services and other
administrative services that would not require such parties to be required to
register as an investment adviser under the Advisers Act; provided that Abbott
shall remain liable for the performance of its duties.
The Sub-Advisory Agreement will terminate automatically in the event of its
assignment. In addition, it may be terminated by Warburg upon 60 days' written
notice to Abbott and the Fund; by Abbott upon 60 days' written notice to Warburg
and the Fund; or by the Fund, upon the vote of a majority of the Fund's Board or
a majority of the outstanding voting securities of the Fund, upon 60 days'
written notice to Warburg and Abbott.
Under the Sub-Advisory Agreement, Warburg will pay Abbott a fee, payable
quarterly, based on the aggregate average daily net assets of the Fund, at the
annual rate of 0.55% of the net asset value of the Investments as of the last
day of each calendar quarter. The fee for the period from the date of the
3
<PAGE>
<PAGE>
Sub-Advisory Agreement to the end of the quarter during which the Sub-Advisory
Agreement commences shall be prorated according to the proportion that such
period bears to the full quarterly period. Upon any termination of the
Sub-Advisory Agreement before the end of a quarter, the fee for such part of
that quarter shall be prorated according to the proportion that such period
bears to the full quarterly period. WARBURG WILL PAY ABBOTT THIS SUB-ADVISORY
FEE OUT OF ITS OWN ASSETS. ABBOTT SHALL HAVE NO RIGHT TO OBTAIN COMPENSATION
DIRECTLY FROM THE FUND FOR SERVICES PROVIDED UNDER THE SUB-ADVISORY AGREEMENT
AND MUST LOOK SOLELY TO WARBURG FOR PAYMENT OF FEES DUE.
INFORMATION ABOUT ABBOTT
Abbott, which was founded in 1986, is an independent specialized investment
firm with assets under management of approximately $3 billion. Abbott is a
registered investment adviser which concentrates on venture capital, buyout and
special situations partnership investments. Abbott's management team provides
full-service private equity programs to clients.
The general partners and principal executive officers of Abbott and their
principal occupations are as shown below. The business address of Mr. Pratt is
50 Rowes Wharf, Suite 240, Boston, Massachusetts 02110-3328 and that of Messrs.
Held, Solomon and Gray is 1330 Avenue of the Americas, Suite 2800, New York, New
York 10019.
<TABLE>
<CAPTION>
POSITION WITH ABBOTT
NAME AND PRINCIPAL OCCUPATION
- ---------------------- -------------------------------------
<S> <C>
Raymond L. Held General Partner; investment manager.
Stanley E. Pratt General Partner; investment manager.
Gary H. Solomon General Partner; investment manager.
Thaddeus I. Gray, CFA Limited Partner; investment manager.
</TABLE>
For tax and other business purposes, the partners of Abbott plan to merge
Abbott with and into, or transfer all of the assets of Abbott to, a newly-formed
Delaware limited liability company ('Abbott LLC'), with Abbott LLC to survive
and assume all of the liabilities of Abbott as part of the transaction. This
transaction, which is expected to occur before September 30, 1996 and is subject
to certain contingencies, will not involve any material change in the
management, ownership, personnel, operations or activities of Abbott. The
present partners of Abbott will be members of Abbott LLC and will hold
officerships and other positions in Abbott LLC carrying responsibilities
generally commensurate with their present responsibilities. Pursuant to a new
sub-advisory agreement (the 'New Sub-Advisory Agreement'), Abbott LLC, as
successor to Abbott, will perform the services then being performed by Abbott.
The New Sub-Advisory Agreement will be substantially identical to the Sub-
Advisory Agreement, except for the change of the service provider from Abbott to
Abbott LLC. Prior to its effectiveness, the New Sub-Advisory Agreement will be
approved by the Board of Directors of the Fund. Shareholder approval of the
Sub-Advisory Agreement will be deemed to represent approval of the New
Sub-Advisory Agreement.
THE DIRECTORS' RECOMMENDATION
In determining whether it was appropriate to approve the Sub-Advisory
Agreement and to recommend approval to shareholders, the Board, including the
Directors who are not interested persons of Warburg or Abbott, considered
various matters and materials provided by Abbott. The Board considered,
primarily, the potential benefits to the Fund of retaining a specialized
sub-adviser to manage a portion of the Fund's assets in venture capital, special
situations and change of control private fund investments (as described above).
The Board also carefully considered Abbott's extensive expertise in managing
these types of investments, including Abbott's personnel and research
capabilities and Abbott's methodology in managing portfolios for institutional
clients. The Board also took into account the lack of any anticipated adverse
impact to the Fund as a result of the Sub-Advisory Agreement, particularly that
the compensation to be received by Abbott will not increase the fees otherwise
incurred by Fund shareholders, but will be paid out of Warburg's own assets.
4
<PAGE>
<PAGE>
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT YOU
VOTE FOR THIS PROPOSAL.
* * * * *
SHAREHOLDER PROPOSALS
As a general matter, the Fund does not hold annual meetings of
shareholders. Shareholders wishing to submit proposals for inclusion in a proxy
statement for a subsequent meeting of shareholders should send their written
proposals to the Secretary of Warburg, Pincus Post-Venture Capital Fund, Inc.,
466 Lexington Avenue, New York, New York 10017-3147. Proposals must be received
at a reasonable time prior to the date of a meeting of shareholders to be
considered for inclusion in the materials for that meeting. Timely submission of
a proposal does not, however, necessarily mean that such proposal will be
included.
OTHER BUSINESS
Management knows of no business to be presented to the Meeting other than
the matter set forth in this proxy statement, but should any other matter
requiring the vote of shareholders arise, the proxies will vote thereon
according to their best judgment in the interests of the Fund.
By Order of the Board of Directors,
EUGENE P. GRACE
Vice President and Secretary
New York, New York
March 12, 1996
5
<PAGE>
<PAGE>
APPENDIX A
OWNERS OF MORE THAN
5% OF THE OUTSTANDING SHARES
OF A CLASS OF THE FUND
COMMON SHARES
<TABLE>
<CAPTION>
NUMBER OF PERCENT OF
COMMON SHARES COMMON SHARES
NAME AND ADDRESS OWNED OF RECORD* OUTSTANDING
- ---------------- ---------------- -------------
<S> <C> <C>
Charles Schwab & Co., Inc. ................................................. 991,604.095 24.55%
Reinvest Account
Attn: Mutual Funds Dept.
101 Montgomery Street
San Francisco, CA 94104-4122
Charles Schwab & Co., Inc .................................................. 204,783.412 5.07%
Cash Account
Attn: Mutual Funds Dept.
101 Montgomery Street
San Francisco, CA 94104-4122
National Financial Services Corp. .......................................... 382,100.804 9.46%
P.O. Box 3908
Church Street Station
New York, NY 10008
</TABLE>
ADVISOR SHARES
<TABLE>
<CAPTION>
NUMBER OF
ADVISOR SHARES PERCENT OF
BENEFICIALLY ADVISOR SHARES
NAME AND ADDRESS OWNED OUTSTANDING
- ---------------- -------------- --------------
<S> <C> <C>
Warburg, Pincus Counsellors, Inc. ............................................... 100 83.88%
Attn: Stephen Distler
466 Lexington Avenue
New York, NY 10017
</TABLE>
- ------------
* The Fund believes that these entities are not the beneficial owners of shares
held of record by them.
A-1
<PAGE>
<PAGE>
APPENDIX B
FORM OF SUB-INVESTMENT ADVISORY AGREEMENT
, 1996
ABBOTT CAPITAL MANAGEMENT, L.P.
50 Rowes Wharf
Boston, MA 02110
Dear Sirs:
Warburg, Pincus Post-Venture Capital Fund, Inc., a Maryland corporation
registered under the Investment Company Act of 1940, as amended (the '1940
Act'), as an open-end, management investment company (the 'Fund'), and Warburg,
Pincus Counsellors, Inc., as investment adviser to the Fund ('Warburg'),
herewith confirms their agreement with Abbott Capital Management, L.P. (the
'Sub-Adviser') as follows:
1. INVESTMENT DESCRIPTION; APPOINTMENT
The Fund desires to employ its capital by investing and reinvesting in
securities of the kind and in accordance with the limitations specified in its
Articles of Incorporation, as may be amended from time to time (the 'Articles'),
and in its Prospectuses and Statement of Additional Information as from time to
time in effect (the 'Prospectus' and 'SAI,' respectively), and in such manner
and to such extent as may from time to time be approved by the Board of
Directors of the Fund. Copies of the Prospectus, SAI and Articles have been or
will be submitted to the Sub-Adviser. The Fund agrees to provide the Sub-Adviser
copies of all amendments to the Prospectus and SAI on an on-going basis. The
Fund employs Warburg as its investment adviser. Warburg desires to employ and
hereby appoints the Sub-Adviser to act as its sub-investment adviser upon the
terms set forth in this Agreement. The Sub-Adviser accepts the appointment and
agrees to furnish the services set forth below for the compensation provided for
herein.
2. SERVICES AS SUB-INVESTMENT ADVISER
(a) Subject to the supervision and direction of Warburg, the Sub-Adviser
will provide investment advisory assistance and portfolio management advice to
the Fund in accordance with (a) the Articles, (b) the 1940 Act and the
Investment Advisers Act of 1940, as amended (the 'Advisers Act'), and all
applicable Rules and Regulations of the Securities and Exchange Commission (the
'SEC') and all other applicable laws and regulations and (c) the Fund's
investment objective and policies as stated in the Prospectus and SAI and
investment parameters provided by Warburg from time to time. In connection
therewith, the Sub-Adviser will:
(i) determine whether to purchase, retain or sell interests in United
States or foreign private investment vehicles that themselves invest in
debt and equity securities of companies in the venture capital and
post-venture capital stages of development or companies engaged in special
situations or changes in corporate control, including buyouts
('Investments'). The Sub-Adviser is hereby authorized to execute, or place
orders for the execution of, all Investments on behalf of the Fund;
(ii) assist the custodian and accounting agent for the Fund in
determining or confirming, consistent with the procedures and policies
stated in the Prospectus and SAI, the value of any Investments for which
the custodian and accounting agent seek assistance from or identify for
review by the Sub-Adviser;
(iii) monitor the execution of orders for the purchase or sale of
Investments and the settlement and clearance of those orders;
(iv) exercise voting rights in respect of Investments; and
(v) provide reports to the Fund's Board of Directors for consideration
at quarterly meetings of the Board on the Investments and furnish Warburg
and the Fund's Board of Directors with such periodic and special reports as
the Fund or Warburg may reasonably request.
B-1
<PAGE>
<PAGE>
(b) In connection with the performance of the services of the Sub-Adviser
provided for herein, the Sub-Adviser may contract at its own expense with third
parties for the acquisition of research, clerical services and other
administrative services that would not require such parties to be required to
register as an investment adviser under the Advisers Act; provided that the
Sub-Adviser shall remain liable for the performance of its duties hereunder.
3. EXECUTION OF TRANSACTIONS
(a) The Sub-Adviser will not effect orders for the purchase or sale of
securities on behalf of the Fund through brokers or dealers as agents.
(b) It is understood that the services of the Sub-Adviser are not
exclusive, and nothing in this Agreement shall prevent the Sub-Adviser from
providing similar services to other investment companies or from engaging in
other activities, provided that those activities do not adversely affect the
ability of the Sub-Adviser to perform its services under this Agreement. The
Fund and Warburg further understand and acknowledge that the persons employed by
the Sub-Adviser to assist in the performance of its duties under this Agreement
will not devote their full time to that service. Nothing contained in this
Agreement will be deemed to limit or restrict the right of the Sub-Adviser or
any affiliate of the Sub-Adviser to engage in and devote time and attention to
other businesses or to render services of whatever kind or nature, provided that
doing so does not adversely affect the ability of the Sub-Adviser to perform its
services under this Agreement.
(c) On occasions when the Sub-Adviser deems the purchase or sale of a
security to be in the best interest of the Fund as well as of other investment
advisory clients of the Sub-Adviser, the Sub-Adviser may, to the extent
permitted by applicable laws and regulations, but shall not be obligated to,
aggregate the securities to be so sold or purchased with those of its other
clients. In such event, allocation of the securities so purchased or sold, as
well as the expenses incurred in the transaction, will be made by the
Sub-Adviser in a manner that is fair and equitable, in the judgment of the
Sub-Adviser, in the exercise of its fiduciary obligations to the Fund and to
such other clients. The Sub-Adviser shall provide to Warburg and the Fund all
information reasonably requested by Warburg and the Fund relating to the
decisions made by the Sub-Adviser regarding allocation of securities purchased
or sold, as well as the expenses incurred in a transaction, among the Fund and
the Sub-Adviser's other investment advisory clients.
(d) In connection with the purchase and sale of securities for the Fund,
the Sub-Adviser will provide such information as may be reasonably necessary to
enable the custodian and co-administrators to perform their administrative and
recordkeeping responsibilities with respect to the Fund.
4. DISCLOSURE REGARDING THE SUB-ADVISER
(a) The Sub-Adviser has reviewed the disclosure about the Sub-Adviser
contained in the Fund's registration statement and represents and warrants that,
with respect to such disclosure about the Sub-Adviser or information related,
directly or indirectly, to the Sub-Adviser, such registration statement
contains, as of the date hereof, no untrue statement of any material fact and
does not omit any statement of a material fact which is required to be stated
therein or necessary to make the statements contained therein not misleading.
(b) The Sub-Adviser agrees to notify Warburg and the Fund promptly of any
(i) statement about the Sub-Adviser contained in the Fund's registration
statement that becomes untrue in any material respect or (ii) omission of a
material fact about the Sub-Adviser in the Fund's registration statement which
is required to be stated therein or necessary to make the statements contained
therein not misleading or (iii) any reorganization or change in the Sub-Adviser,
including any change in its ownership or key employees.
(c) Prior to the Fund or Warburg or any affiliated person (as defined in
the 1940 Act, an 'Affiliate') of either using or distributing sales literature
or other promotional material referring to the Sub-Adviser, the Sub-Adviser
shall have the right to approve the general advertising or promotional plan
pursuant to which such literature or material is being utilized or distributed;
provided that the Sub-Adviser shall be deemed to have approved such advertising
or plan if it has not objected to its use within ten (10) business days after
such material has been sent to it. The Fund or Warburg will use all
B-2
<PAGE>
<PAGE>
reasonable efforts to ensure that all advertising, sales and promotional
material used or distributed by or on behalf of the Fund or Warburg that refers
to the Sub-Adviser will comply with the requirements of the Advisers Act, the
1940 Act and the rules and regulations promulgated thereunder.
(d) The Sub-Adviser has supplied Warburg and the Fund copies of its Form
ADV with all exhibits and attachments thereto and will hereinafter supply
Warburg, promptly upon preparation thereof, copies of all amendments or
restatements of such document.
5. CERTAIN REPRESENTATIONS AND WARRANTIES OF THE SUB-ADVISER
(a) The Sub-Adviser represents and warrants that it is a duly registered
investment adviser under the Advisers Act, a duly registered investment adviser
in any and all states of the United States in which the Sub-Adviser is required
to be so registered and has obtained all necessary licenses and approvals in
order to perform the services provided in this Agreement. The Sub-Adviser
covenants to maintain all necessary registrations, licenses and approvals in
effect during the term of this Agreement.
(b) The Sub-Adviser represents that it has read and understands the
Prospectus and SAI and warrants that in investing the Fund's assets it will use
all reasonable efforts to adhere to the Fund's investment objectives, policies
and restrictions contained therein.
6. COMPLIANCE
(a) The Sub-Adviser agrees that it shall promptly notify Warburg and the
Fund (i) in the event that the SEC or any other regulatory authority has
censured its activities, functions or operations; suspended or revoked its
registration as an investment adviser; or has commenced proceedings or an
investigation that may result in any of these actions, (ii) in the event that
there is a change in the Sub-Adviser, financial or otherwise, that adversely
affects its ability to perform services under this Agreement or (iii) upon
having a reasonable basis for believing that, as a result of the Sub-Adviser's
investing the Fund's assets, the Fund's investment portfolio has ceased to
adhere to the Fund's investment objectives, policies and restrictions as stated
in the Prospectus or SAI or is otherwise in violation of applicable law.
(b) Warburg agrees that it shall promptly notify the Sub-Adviser in the
event that the SEC has censured Warburg or the Fund; placed limitations upon any
of their activities, functions or operations; suspended or revoked Warburg's
registration as an investment adviser; or has commenced proceedings or an
investigation that may result in any of these actions.
(c) The Fund and Warburg shall be given access to the records of the
Sub-Adviser at reasonable times solely for the purpose of monitoring compliance
with the terms of this Agreement and the rules and regulations applicable to the
Sub-Adviser relating to its providing investment advisory services to the Fund,
including without limitation records relating to trading by employees of the
Sub-Adviser for their own accounts and on behalf of other clients. The
Sub-Adviser agrees to cooperate with the Fund and Warburg and their
representatives in connection with any such monitoring efforts.
7. BOOKS AND RECORDS
(a) In compliance with the requirements of Rule 31a-3 under the 1940 Act,
the Sub-Adviser hereby agrees that all records which it maintains for the Fund
are the property of the Fund and further agrees to surrender promptly to either
Warburg or the Fund any of such records upon the request of either of them. The
Sub-Adviser further agrees to preserve for the periods prescribed by Rule 31a-2
under the 1940 Act the records required to be maintained by Rule 31a-1 under the
1940 Act and to preserve the records required by Rule 204-2 under the Advisers
Act for the period specified therein.
(b) The Sub-Adviser hereby agrees to furnish to regulatory authorities
having the requisite authority any information or reports in connection with
services that the Sub-Adviser renders pursuant to this Agreement which may be
requested in order to ascertain whether the operations of the Fund are being
conducted in a manner consistent with applicable laws and regulations.
8. PROVISION OF INFORMATION; PROPRIETARY AND CONFIDENTIAL INFORMATION
(a) Warburg agrees that it will furnish to the Sub-Adviser information
related to or concerning the Fund that the Sub-Adviser may reasonably request.
B-3
<PAGE>
<PAGE>
(b) The Sub-Adviser agrees on behalf of itself and its employees to treat
confidentially and as proprietary information of the Fund all records and other
information relative to the Fund, Warburg and prior, present or potential
shareholders and not to use such records and information for any purpose other
than performance of its responsibilities and duties hereunder except after prior
notification to and approval in writing of the Fund, which approval shall not be
unreasonably withheld and may not be withheld where the Sub-Adviser may be
exposed to civil or criminal contempt proceedings for failure to comply or when
requested to divulge such information by duly constituted authorities.
(c) The Sub-Adviser represents and warrants that neither it nor any
affiliate will use the name of the Fund, Warburg or any of their affiliates in
any prospectus, sales literature or other material in any manner without the
prior written approval of the Fund or Warburg, as applicable.
9. STANDARD OF CARE
The Sub-Adviser shall exercise its best judgment in rendering the services
described herein. The Sub-Adviser shall not be liable for any error of judgment
or mistake of law or for any loss suffered by the Fund or Warburg in connection
with the matters to which this Agreement relates, except that the Sub-Adviser
shall be liable for a loss resulting from a breach of fiduciary duty by the
Sub-Adviser with respect to the receipt of compensation for services; provided
that nothing herein shall be deemed to protect or purport to protect the
Sub-Adviser against any liability to the Fund, to Warburg or to shareholders of
the Fund to which the Sub-Adviser would otherwise be subject by reason of
willful misfeasance, bad faith or gross negligence on its part in the
performance of its duties or by reason of the Sub-Adviser's reckless disregard
of its obligations and duties under this Agreement. The Fund and Warburg
understand and agree that the Sub-Adviser may rely upon information furnished to
it reasonably believed by the Sub-Adviser to be accurate and reliable and,
except as herein provided, the Sub-Adviser shall not be accountable for loss
suffered by the Fund by reason of such reliance of the Sub-Adviser.
10. INDEMNIFICATION
(a) The Sub-Adviser agrees to indemnify and hold harmless the Fund,
Warburg, any affiliate of either, and each person, if any, who, within the
meaning of Section 15 of the Securities Act of 1933, as amended (the '1933
Act'), controls ('controlling person') either or both of the Fund and Warburg
(all of such persons being referred to as 'Fund Indemnified Persons') against
any and all losses, claims, damages, liabilities or litigation (including legal
and other expenses) to which any Fund Indemnified Person may become subject
under the 1933 Act, the 1940 Act, the Advisers Act, the Internal Revenue Code or
under any other statute, at common law or otherwise, arising out of the
Sub-Adviser's responsibilities as Sub-Adviser to the Fund which (i) may be based
upon any misfeasance, malfeasance or nonfeasance by the Sub-Adviser, or any of
its employees or representatives, or any affiliate of or any person acting on
behalf of the Sub-Adviser, (ii) may be based upon a failure to comply with
paragraph 5(b) of this Agreement, or (iii) may be based upon any untrue
statement or alleged untrue statement of a material fact about the Sub-Adviser
contained in the registration statement covering the shares of the Fund, or any
amendment or supplement thereto, or the omission or alleged omission to state
therein a material fact about the Sub-Adviser known or which should have been
known to the Sub-Adviser and was required to be stated therein or necessary to
make the statements therein not misleading, if such a statement or omission was
made in reliance upon information furnished to Warburg, the Fund or any
affiliate of either by the Sub-Adviser or any affiliate of the Sub-Adviser;
provided that in no case shall the indemnity in favor of any Indemnified Person
be deemed to protect such persons against any liability to which any such person
would otherwise be subject by reason of willful misfeasance, bad faith, gross
negligence in the performance of its duties or by reason of its reckless
disregard of its obligations and duties under this Agreement.
(b) The Fund agrees to indemnify and hold harmless the Sub-Adviser, any of
its affiliates, and each controlling person, if any, of the Sub-Adviser (all of
such persons being referred to as 'Sub-Adviser Indemnified Persons') against any
and all losses, claims, damages, liabilities or litigation (including legal and
other expenses) to which any Sub-Adviser Indemnified Person may become subject
under the 1933 Act, the 1940 Act, the Advisers Act, the Internal Revenue Code or
under any other statute, at common
B-4
<PAGE>
<PAGE>
law or otherwise, which (i) may be based upon any misfeasance, malfeasance or
nonfeasance by the Fund or Warburg, or any of its respective employees or
representatives, or any affiliate of or any person acting on behalf of the Fund
or Warburg, (ii) may be based upon a failure by the Fund or Warburg to comply
with this Agreement, or (iii) may be based upon any untrue statement or alleged
untrue statement of a material fact contained in the registration statement
covering the shares of the Fund, or any amendment or supplement thereto, or the
omission or alleged omission to state therein a material fact known or which
should have been known to the Fund and was required to be stated therein or
necessary to make the statements therein not misleading, unless such a statement
or omission was made in reliance upon information furnished to Warburg, the Fund
or any affiliate of either by the Sub-Adviser or any affiliate of the
Sub-Adviser; provided that in no case shall the indemnity in favor of any
Sub-Adviser Indemnified Person be deemed to protect such persons against any
liability to which any such person would otherwise be subject by reason of
willful misfeasance, bad faith, gross negligence in the performance of its
duties or by reason of its reckless disregard of its obligations and duties
under this Agreement.
(c) A party (the 'Indemnifying Person') shall not be liable under
paragraphs 10(a) or 10(b) herein with respect to any claim made against any Fund
Indemnified Person or Sub-Adviser Indemnified Person, as applicable (a Fund
Indemnified Person and a Sub-Adviser Indemnified Person may be referred to in
this paragraph 10(c) as an 'Indemnified Person'), unless such Indemnified Person
shall have notified the Indemnifying Person in writing within a reasonable time
after the summons, notice or other first legal process or notice giving
information of the nature of the claim shall have been served upon such
Indemnified Person (or after such Indemnified Person shall have received notice
of such service on any designated agent), but failure to notify the Indemnifying
Person of any such claim shall not relieve the Indemnifying Person from any
liability which it may have to any Indemnified Person against whom such action
is brought otherwise than on account of this paragraph 10. In case any such
action is brought against any Indemnified Person, the Indemnifying Person will
be entitled to participate, at its own expense, in the defense thereof or, after
notice to the Indemnified Person, to assume the defense thereof, with counsel
satisfactory to the Indemnified Person. If the Indemnifying Person assumes the
defense of any such action and the selection of counsel by the Indemnifying
Person to represent the Indemnifying Person and the Indemnified Person would
result in a conflict of interests and therefore would not, in the reasonable
judgment of the Indemnified Person, adequately represent the interests of the
Indemnified Person, the Indemnifying Person will, at its own expense, assume the
defense with counsel to the Indemnifying Person and, also at its own expense,
with separate counsel to the Indemnified Person which counsel shall be
satisfactory to the Indemnifying Person and to the Indemnified Person. The
Indemnified Person shall bear the fees and expenses of any additional counsel
retained by it, and the Indemnifying Person shall not be liable to the
Indemnified Person under this Agreement for any legal or other expenses
subsequently incurred by the Indemnified Person independently in connection with
the defense thereof other than reasonable costs of investigation. The
Indemnifying Person shall not have the right to compromise on or settle the
litigation without the prior written consent of the Indemnified Person if such
compromise or settlement results, or may result, in a finding of wrongdoing on
the part of the Indemnified Person.
11. COMPENSATION
In consideration of the services rendered pursuant to this Agreement,
Warburg will pay the Sub-Adviser a quarterly fee calculated at an annual rate of
.55% of the net asset value of the Investments as of the last day of each
calendar quarter. The fee for the period from the date of this Agreement to the
end of the quarter during which this Agreement commenced shall be prorated
according to the proportion that such period bears to the full quarterly period.
Such fee shall be paid by Warburg to the Sub-Adviser within ten (10) business
days after the last day of each quarter or, upon termination of this Agreement
before the end of a quarter, within ten (10) business days after the effective
date of such termination. Upon any termination of this Agreement before the end
of a quarter, the fee for such part of that quarter shall be prorated according
to the proportion that such period bears to the full quarterly period. For the
purpose of determining fees payable to the Sub-Adviser, the value of the
Investments shall be computed in the manner specified in the Prospectus or SAI.
The Sub-Adviser shall have no
B-5
<PAGE>
<PAGE>
right to obtain compensation directly from the Fund for services provided
hereunder and agrees to look solely to Warburg for payment of fees due.
12. EXPENSES
(a) The Sub-Adviser will bear all expenses in connection with the
performance of its services under this Agreement, which shall not include the
Fund's expenses listed in paragraph 12(b).
(b) The Fund will bear certain other expenses to be incurred in its
operation, including: investment advisory and administration fees; taxes,
interest, brokerage fees and commissions, if any; fees of Directors of the Fund
who are not officers, directors, or employees of the Fund, Warburg or the Sub-
Adviser or affiliates of any of them; fees of any pricing service employed to
value shares of the Fund; SEC fees, state Blue Sky qualification fees and any
foreign qualification fees; charges of custodians and transfer and dividend
disbursing agents; the Fund's proportionate share of insurance premiums; outside
auditing and legal expenses; costs of maintenance of the Fund's existence; costs
attributable to investor services, including, without limitation, telephone and
personnel expenses; costs of preparing and printing prospectuses and statements
of additional information for regulatory purposes and for distribution to
existing shareholders; costs of shareholders' reports and meetings of the
shareholders of the Fund and of the officers or Board of Directors of the Fund;
and any extraordinary expenses.
13. TERM OF AGREEMENT
This Agreement shall continue until April 17, 1997 and thereafter shall
continue automatically for successive annual periods, provided such continuance
is specifically approved at least annually by (a) the Board of Directors of the
Fund or (b) a vote of a 'majority' (as defined in the 1940 Act) of the Fund's
outstanding voting securities, provided that in either event the continuance is
also approved by a majority of the Board of Directors who are not 'interested
persons' (as defined the 1940 Act) of any party to this Agreement, by vote cast
in person at a meeting called for the purpose of voting on such approval. This
Agreement is terminable, without penalty, (i) by Warburg on 60 (sixty) days'
written notice to the Fund and the Sub-Adviser, (ii) by the Board of Directors
of the Fund or by vote of holders of a majority of the Fund's shares on 60
(sixty) days' written notice to Warburg and the Sub-Adviser, or (iii) by the
Sub-Adviser upon 60 (sixty) days' written notice to the Fund and Warburg. This
Agreement will also terminate automatically in the event of its assignment (as
defined in the 1940 Act) by any party hereto. In the event of termination of
this Agreement for any reason, all records relating to the Fund kept by the
Sub-Adviser shall promptly be returned to Warburg or the Fund, free from any
claim or retention of rights in such records by the Sub-Adviser. In the event
this Agreement is terminated or is not approved in the foregoing manner, the
provisions contained in paragraph numbers 4(c), 7, 8, 9 and 10 shall remain in
effect.
14. AMENDMENTS
No provision of this Agreement may be changed, waived, discharged or
terminated orally, but only by an instrument in writing signed by the party
against which enforcement of the change, waiver, discharge or termination is
sought, and no amendment of this Agreement shall be effective until approved by
an affirmative vote of (a) the holders of a majority of the outstanding voting
securities of the Fund and (b) the Board of Directors of the Fund, including a
majority of Directors who are not 'interested persons' (as defined in the 1940
Act) of the Fund or of either party to this Agreement, by vote cast in person at
a meeting called for the purpose of voting on such approval, if such approval is
required by applicable law.
15. NOTICES
All communications hereunder shall be given (a) if to the Sub-Adviser, to
Abbott Capital Management, L.P., 1330 Avenue of the Americas, Suite 2800, New
York, New York 10019 (Attention: Raymond L. Held), telephone: (212) 757-2700,
telecopy: (212) 757-0835, (b) if to Warburg, to Warburg, Pincus Counsellors,
Inc., 466 Lexington Avenue, New York, New York 10017-3147 (Attention: Eugene P.
Grace), telephone: (212) 878-0600, telecopy: (212) 878-9351, and (c) if to the
Fund, to Warburg, Pincus Post-Venture Capital Fund, Inc., c/o Warburg Pincus
Funds, 466 Lexington Avenue, New York, New York 10017-3147, telephone: (212)
878-0600, telecopy: (212) 878-9351 (Attention: President).
B-6
<PAGE>
<PAGE>
16. CHOICE OF LAW
This Agreement shall be governed by, and construed in accordance with, the
laws of the State of New York in the United States, including choice of law
principles; provided that nothing herein shall be construed in a manner
inconsistent with the 1940 Act, the Advisers Act or any applicable rules,
regulations or orders of the SEC.
17. CHANGE OF MEMBERSHIP
For so long as the Sub-Adviser is a partnership, the Sub-Adviser agrees to
notify Warburg and the Fund of any change in the membership of the Sub-Adviser
within a reasonable time after such change.
18. MISCELLANEOUS
(a) The captions of this Agreement are included for convenience only and in
no way define or limit any of the provisions herein or otherwise affect their
construction or effect.
(b) If any provision of this Agreement shall be held or made invalid by a
court decision, by statute or otherwise, the remainder of this Agreement shall
not be affected thereby and, to this extent, the provisions of this Agreement
shall be deemed to be severable.
(c) Nothing herein shall be construed to make the Sub-Adviser an agent of
Warburg or the Fund.
(d) This Agreement may be executed in counterparts, with the same effect as
if the signatures were upon the same instrument.
Please confirm that the foregoing is in accordance with your understanding
by indicating your acceptance hereof at the place below indicated, whereupon it
shall become a binding agreement between us.
Very truly yours,
WARBURG, PINCUS COUNSELLORS, INC.
By: __________________________________
WARBURG, PINCUS POST-VENTURE CAPITAL
FUND, INC.
By: __________________________________
President
Accepted:
ABBOTT CAPITAL MANAGEMENT, L.P.
By: __________________________________
General Partner
B-7
<PAGE>
<PAGE>
WARBURG, PINCUS POST-VENTURE CAPITAL, INC.
PROXY SOLICITED BY THE BOARD OF DIRECTORS
The undersigned holder of shares of Warburg, Pincus Post-Venture Capital Fund,
Inc. (the "Fund") hereby appoints Arnold M. Reichman and Eugene P. Grace,
attorneys and proxies for the undersigned with full powers of substitution and
revocation, to represent the undersigned and to vote on behalf of the
undersigned all shares of the Fund that the undersigned is entitled to vote at
the Special Meeting of Shareholders of the Fund (the "Meeting") to be held at
the offices of the Fund, 466 Lexington Avenue, 10th Floor, New York, New York
10017-3147 on May 10, 1996 at 3:00 p.m., Eastern time, and any adjournment or
adjournments thereof. The undersigned hereby acknowledges receipt of the Notice
of Special Meeting and Proxy Statement dated March 12, 1996 and hereby instructs
said attorneys and proxies to vote said shares as indicated herein. In their
discretion, the proxies are authorized to vote upon such other business as may
properly come before the Meeting. A majority of the proxies present and acting
at the meeting in person or by substitution (or, if only one shall be so
present, then that one) shall have and may exercise all of the power and
authority of said proxies hereunder. The undersigned hereby revokes any proxy
previously given.
PLEASE VOTE, DATE, AND SIGN ON THE OTHER SIDE AND
RETURN PROMPTLY IN ENCLOSED ENVELOPE.
Note: Please sign exactly as your name appears on this Proxy. If joint owners,
EITHER may sign this Proxy. When signing as attorney, executor, administrator,
trustee, guardian or corporate officer, please give your full title.
HAS YOUR ADDRESS CHANGED? DO YOU HAVE ANY COMMENTS?
- -------------------------------------- ---------------------------------------
- -------------------------------------- ---------------------------------------
- -------------------------------------- ---------------------------------------
<PAGE>
<PAGE>
[X] PLEASE MARK VOTES AS IN THIS EXAMPLE
VOTE THIS PROXY CARD TODAY!
YOUR PROMPT RESPONSE WILL SAVE
THE EXPENSE OF ADDITIONAL MAILINGS
This proxy, if properly executed, will be voted in
the manner directed by the undersigned shareholder.
IF NO DIRECTION IS MADE, THIS PROXY WILL
BE VOTED "FOR" APPROVAL OF THE PROPOSAL.
RECORD DATE SHARES:
The Board of Directors unanimously recommends a
vote "FOR" the following proposal.
For Against Abstain
To approve or disapprove the Sub-Investment [ ] [ ] [ ]
Advisory Agreement among the Fund, Warburg,
Pincus, Counsellors, Inc. and Abbott
Capital Management, L.P.
Please be sure to sign and date this Proxy. Date__________________
Stockholder sign here_______________________________
Co-owner sign here__________________________________
DETACH CARD
Mark box at right if comments or address change have [ ]
been noted on the reverse side.
DETACH CARD
<PAGE>
