-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, VJljnwlavSt9co45woUXuQRCMnrikAynExFy6oBnZGn2KOifgiFllMAa/5Sh6Bc/ 8SpWPmkRAgbZx1UU3ONPFg== 0001005477-01-001767.txt : 20010307 0001005477-01-001767.hdr.sgml : 20010307 ACCESSION NUMBER: 0001005477-01-001767 CONFORMED SUBMISSION TYPE: N-14 8C PUBLIC DOCUMENT COUNT: 8 FILED AS OF DATE: 20010305 FILER: COMPANY DATA: COMPANY CONFORMED NAME: CSAM INCOME FUND CENTRAL INDEX KEY: 0000810766 STANDARD INDUSTRIAL CLASSIFICATION: UNKNOWN SIC - 0000 [0000] IRS NUMBER: 232451535 STATE OF INCORPORATION: MD FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: N-14 8C SEC ACT: SEC FILE NUMBER: 333-56526 FILM NUMBER: 1561056 BUSINESS ADDRESS: STREET 1: CSAM STREET 2: 466 LEXINGTON AVENUE CITY: NEW YORK STATE: NY ZIP: 10017 BUSINESS PHONE: 18002931232 MAIL ADDRESS: STREET 1: CSAM STREET 2: 466 LEXINGTON AVENUE CITY: NEW YORK STATE: NY ZIP: 10017 FORMER COMPANY: FORMER CONFORMED NAME: BEA INCOME FUND INC DATE OF NAME CHANGE: 19950828 FORMER COMPANY: FORMER CONFORMED NAME: CS FIRST BOSTON INCOME FUND INC DATE OF NAME CHANGE: 19950420 FORMER COMPANY: FORMER CONFORMED NAME: FIRST BOSTON INCOME FUND INC DATE OF NAME CHANGE: 19920703 N-14 8C 1 0001.txt FORM N-14 As filed with the Securities and Exchange Commission on March 2, 2001 Securities Act File No. 333-_______ SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM N-14 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 Pre-Effective Amendment No. / / Post-Effective Amendment No. / / CREDIT SUISSE ASSET MANAGEMENT INCOME FUND, INC. (Exact Name of Registrant as Specified in Charter) 466 Lexington Avenue, 16th Floor, New York, New York 10017 (Address of Principal Executive Offices: Number, Street, City, State, Zip Code) (212) 875-3500 (Registrant's Area Code and Telephone Number) ------------- Hal Liebes, Esq. Senior Vice President Credit Suisse Asset Management Income Fund, Inc. 466 Lexington Avenue, 16th Floor New York, New York 10017 (Name and Address of Agent for Service) with copies to: Daniel Schloendorn, Esq. Willkie Farr & Gallagher 787 Seventh Avenue New York, New York 10019 ------------- Approximate Date of Proposed Public Offering: As soon as practicable after this Registration Statement becomes effective CALCULATION OF REGISTRATION FEE UNDER THE SECURITIES ACT OF 1933 ================================================================================ TITLE OF PROPOSED PROPOSED SECURITIES AMOUNT MAXIMUM MAXIMUM AMOUNT OF BEING BEING OFFERING PRICE AGGREGATE REGISTRATION REGISTERED REGISTERED PER UNIT (1) OFFERING PRICE (1) FEE - -------------------------------------------------------------------------------- Common Stock ($0.001 par value) 14,996,378 $6.36 $95,376,964 $23,844.24 ================================================================================ (1) Estimated solely for purposes of calculating the registration fee in accordance with Rule 457(f) under the Securities Act of 1933, as amended, based on the average of the high and low sales prices of the Registrant's Common Stock as reported on the New York Stock Exchange on March 1, 2001. The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, as amended, or until this Registration Statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine. CREDIT SUISSE ASSET MANAGEMENT INCOME FUND, INC. CONTENTS OF REGISTRATION STATEMENT This Registration Statement contains the following papers and documents: o Cover Sheet o Contents of Registration Statement o Form N-14 Cross Reference Sheet o Letter to Shareholders of Credit Suisse Asset Management Income Fund, Inc. o Letter to Shareholders of Credit Suisse Asset Management Strategic Global Income Fund, Inc. o Notice of Annual Meeting of Shareholders of Credit Suisse Asset Management Income Fund, Inc. o Notice of Special Meeting of Shareholders of Credit Suisse Asset Management Strategic Global Income Fund, Inc. o Part A - Proxy Statement/Prospectus o Part B - Statement of Additional Information o Part C - Other Information o Signature Page o Exhibits CROSS REFERENCE SHEET PART A Item No. and Caption Proxy Statement/Prospectus Caption - --------------------------- ---------------------------------- 1. Beginning of Registration Statement Cover Page and Outside Front Cover Page of Prospectus 2. Beginning and Outside Back Cover Cover Page; Table of Contents Page of Prospectus Contents 3. Fee Table, Synopsis Information, Synopsis; Risk Factors and Special and Risk Factors Considerations; Comparison of Investment Objectives and Policies 4. Information about the Transactions Synopsis - The Proposed Reorganization; Information about the Reorganization; Additional Information about the Funds 5. Information about the Registrant Synopsis; Risk Factors and Special Considerations; Comparison of Investment Objectives and Policies; Additional Information about the Funds 6. Information about the Company Synopsis; Risk Factors and Special Being Acquired Considerations; Comparison of Investment Objectives and Policies; Additional Information about the Funds 7. Voting Information Notice of Meeting of Shareholders; General; Required Vote 8. Interest of Certain Persons and Additional Information about the Funds Experts 9. Additional Information Required (Not Applicable) for Reoffering by Persons Deemed to be Underwriters PART B Item No. and Caption Statement of Additional Information Caption - --------------------------- -------------------------------------- 10. Cover Page Cover Page 11. Table of Contents Table of Contents 12. Additional Information about the Comparison of Risk Factors and Special Registrant Considerations (in Part A); Comparison of Investment Objectives and Policies (in Part A); Additional Information about the Funds (in Part A); Tax Considerations 13. Additional Information about the Comparison of Risk Factors and Special Company Being Acquired Considerations (in Part A); Comparison of Investment Objectives and Policies; Additional Information about the Funds (in Part A); Tax Considerations 14. Financial Statements Financial Statements PART C - ------ 15 - 17 Information required to be included in Part C is set forth under the appropriate Item, so numbered, in Part C of this Registration Statement. PART A INFORMATION REQUIRED IN THE PROXY STATEMENT/PROSPECTUS CREDIT SUISSE ASSET MANAGEMENT INCOME FUND, INC. 466 Lexington Avenue, 16th Floor New York, New York 10017 ________, 2001 Dear Shareholder: We are pleased to invite you to the 2001 annual meeting of shareholders of Credit Suisse Asset Management Income Fund, Inc., which is referred to in this letter as "CIK." The annual meeting is scheduled to be held at 2:00 p.m., Eastern time, on Tuesday, May 1, 2001, at the offices of CIK's investment manager, Credit Suisse Asset Management, LLC ("CSAM"), 466 Lexington Avenue, 16th Floor, New York, New York 10017. Shareholders who are unable to attend this meeting are strongly encouraged to vote by proxy. A Proxy Statement/Prospectus regarding the meeting, a proxy card for your vote at the meeting and an envelope--postage prepaid--in which to return your proxy card are enclosed. At the annual meeting, you will be asked to vote on a number of proposals, the most significant of which is the proposed reorganization of CIK and Credit Suisse Asset Management Strategic Global Income Fund, Inc. ("CGF"), in which CIK will acquire all the assets and liabilities of CGF in exchange for CIK shares. As a result of the reorganization, each CGF shareholder will receive CIK shares having an aggregate net asset value equal to the aggregate net asset value of such shareholder's CGF shares. The CIK Board's approval and recommendation that you vote for the reorganization springs from a number of issues which CIK's investment advisor and directors have been considering over a period of time. First, while very much wishing to retain the closed-end characteristic of CIK, it has been the unanimous view of the Board that an increase in CIK's asset size could potentially benefit shareholders in several ways: the expense ratio could be reduced, CIK's investment flexibility and opportunities could be enhanced and analyst coverage of CIK might be expanded, a factor that the investment advisor has identified as one that may positively affect the discount/premium at which a closed-end fund trades. As some of you may recall, CIK participated in a rights offering in 1996 that had the benefit of increasing CIK's size. Presently, the Board has concluded that the proposed reorganization, which is expected to bring [80 million] of net assets into CIK and result in a combined fund with $295 million in net assets (based on current asset levels), would offer CIK shareholders the benefits of a larger size without diluting their net asset value. Of course, it would also permit CGF, which has less assets than CIK to experience the advantages of expanded size as well. In addition, the Board recently adopted a new investment policy whereby the Fund may invest up to 35% of its net assets in emerging markets debt securities and accepted a recommendation from the investment advisor to partially reposition the Fund's portfolio. As a result, the Fund has liquidated its investment-grade debt securities portfolio (approximately 15% of the Fund's net assets) and re-deployed those assets in emerging market debt securities. The Board of Directors and the investment advisor believe that the reorganization is in step with the Fund's investment objective of seeking current income and consistent with the repositioning of the Fund's portfolio. For example, by assuming the assets of CGF, the Fund is expected to be able to better pursue its objective because some of those assets represent higher yielding emerging markets debt. In addition, a portion of CGF's portfolio is comprised of domestic high yield debt that, although still below investment grade, is rated higher than the domestic high yield debt held by the Fund. Moreover, studies have shown that an international component to a portfolio can help to stabilize it because domestic and international markets will sometimes move in opposite directions. Given the advantages of increased size and the change in the investment portfolio, the Board believes the proposed reorganization is in the best interests of CIK's shareholders. For the reasons set forth above, the Board has unanimously approved this reorganization and recommended that shareholders vote to approve it. The proposed reorganization is described in more detail in the Proxy Statement/Prospectus. You are also being asked to approve a new investment advisory agreement with CSAM. The new agreement will be substantially the same as the current agreement except that the investment advisory fee paid to CSAM will be based upon the lower of the average weekly stock price (market value) of CIK's outstanding shares or its average weekly net assets. By virtue of this structure, CIK will: o reduce its investment advisory fees if its shares trade at a discount, thereby lowering its expense ratio, and o more closely align the interests of CSAM with the interests of the shareholders which are aimed at enhancing the Fund's market value. The new investment advisory agreement, which was proposed by CSAM in recognition of the economies of scale that would result from the combination of CIK and CGF, would take effect only upon the consummation of the Reorganization. At the annual meeting, you will also be asked to elect five (5) management nominees standing for election to the Fund's Board of Directors. THE BOARD OF DIRECTORS OF YOUR FUND BELIEVES THAT THE PROPOSED REORGANIZATION AND THE OTHER PROPOSALS ARE IN THE BEST INTERESTS OF THE SHAREHOLDERS AND RECOMMENDS THAT YOU READ THE ENCLOSED MATERIALS CAREFULLY AND THEN VOTE IN FAVOR OF THE PROPOSALS, INCLUDING THE FUND'S NOMINEES. Your vote is important. PLEASE TAKE A MOMENT NOW TO SIGN AND RETURN YOUR PROXY CARD IN THE ENCLOSED POSTAGE-PAID RETURN ENVELOPE. If we do not receive your signed proxy card after a reasonable amount of time, you may receive a telephone call from our proxy solicitor, Georgeson Shareholder Communications, reminding you to vote your shares. If you prefer, you can fax the proxy card to Georgeson Shareholder Communications, Attn.: ______________, at (___) ___-____. We also encourage you to vote by telephone or through the Internet. Proxies may be voted by telephone by calling (___) ___-____ between the hours of 9:00 a.m. and 10:00 p.m. (Eastern time) or through the Internet using the Internet address located on your proxy card. Voting by fax, telephone or through the Internet will reduce the time and costs associated with the proxy solicitation. When the Fund records proxies by telephone or through the Internet, it will use procedures designed to (i) authenticate shareholders' identities, (ii) allow shareholders to authorize the voting of their shares in accordance with their instructions and (iii) confirm that their instructions have been properly recorded. Shareholders voting via the Internet should understand that there may be costs associated with electronic access, such as usage charges from Internet access providers and telephone companies, that must be borne by the shareholder. We have been advised that Internet voting procedures that have been made available to you are consistent with the requirements of applicable law. Whichever voting method you choose, please read the full text of the proxy statement before you vote. If you have any questions regarding the proposed reorganization, please feel free to call Georgeson Shareholder Communications at (___) ___-____ who will be pleased to assist you. IT IS VERY IMPORTANT THAT YOUR VOTING INSTRUCTIONS BE RECEIVED PROMPTLY. Respectfully, James P. McCaughan Chairman of the Board of Directors YOU ARE URGED TO SIGN THE PROXY CARD(S) AND RETURN THE CARD(S) IN THE POSTAGE-PAID ENVELOPE TO ENSURE A QUORUM AT THE MEETING. YOUR VOTE IS IMPORTANT REGARDLESS OF THE SIZE OF YOUR SHAREHOLDINGS. CREDIT SUISSE ASSET MANAGEMENT STRATEGIC GLOBAL INCOME FUND, INC. 466 Lexington Avenue, 16th Floor New York, New York 10017 __________, 2001 Dear Shareholder: We are pleased to invite you to a special meeting of shareholders of Credit Suisse Asset Management Strategic Global Income Fund, Inc., which is referred to in this letter as "CGF." The special meeting is scheduled to be held at 3:00 p.m., Eastern time, on Tuesday, May 1, 2001, at the offices of CGF's investment manager, Credit Suisse Asset Management, LLC ("CSAM"), 466 Lexington Avenue, 16th Floor, New York, New York 10017. Shareholders who are unable to attend this meeting are strongly encouraged to vote by proxy. A Proxy Statement/ Prospectus regarding the meeting, a proxy card for your vote at the meeting and an envelope--postage prepaid--in which to return your proxy card are enclosed. At the special meeting, you will be asked to vote on a proposed reorganization of CGF and Credit Suisse Asset Management Income Fund, Inc., referred to below as "CIK", in which CIK will acquire all the assets and liabilities of CGF in exchange for CIK shares. As a result of the reorganization, you will receive that number of CIK shares having an aggregate net asset value equal to the aggregate net asset value of your shares as of the close of business on the closing date of the reorganization (except that cash will be paid in lieu of fractional shares). The recommendation that you vote for the reorganization springs from a number of issues which CGF's investment advisor and directors have been considering over a period of time. First, while very much wishing to retain the closed-end characteristic of CGF, it is the unanimous view of the Board that CGF has not attained a sufficient critical mass, and that if CGF could combine with a larger fund, shareholders could potentially benefit in several ways: the expense ratio could be reduced, investment flexibility and opportunities could be enhanced and access to analyst coverage would likely be enhanced, a factor that the investment advisor has identified as one that can positively affect the discount/premium at which a closed-end fund trades. Currently, analyst coverage of CGF has not been initiated. The Board has concluded that the proposed reorganization would offer CGF shareholders the benefits of a larger size, including a significantly lower expense ratio, without diluting their net asset value. The reorganization is expected to result in a combined fund with $295 million in net assets (three times the size of CGF based on current asset levels). In addition, following a recommendation by the investment advisor, CGF recently reduced the percentage of its net assets invested in emerging markets debt to 15% from approximately 35%, thus aligning CGF's portfolio mix to that of CIK. Given the advantages of increased size and the change in the investment portfolio, the Board of Directors believes the proposed reorganization is in the best interests of CGF's shareholders. For the reasons set forth above, the Board (whose members also serve on the Board of Directors of CIK) has unanimously approved this reorganization, subject to shareholder approval. The proposed reorganization are described in more detail in the Combined Proxy Statement/Prospectus. CIK shareholders are also being asked to approve a new investment advisory agreement with CSAM. The new agreement will be substantially the same as the current agreement except that the investment advisory fee paid to CSAM will be based upon the lower of the average weekly stock price (market value) of CIK's outstanding shares or its average weekly net assets. By virtue of this structure, CIK will: o reduce its investment advisory fees if its shares trade at a discount, thereby lowering its expense ratio, and o more closely align the interests of CSAM with the interests of CIK shareholders which are aimed at enhancing CIK's market value. The new investment advisory agreement, which was proposed by CSAM in recognition of the economies of scale afforded by the combination of CIK and CGF, will take effect only upon the consummation of the reorganization. If the reorganization is consummated, as shareholders of CIK you will benefit from the advisory fee structure changes. You are not being asked to vote separately on this matter. THE BOARD OF DIRECTORS OF YOUR FUND BELIEVES THAT THE PROPOSED REORGANIZATION IS IN THE BEST INTERESTS OF THE SHAREHOLDERS AND RECOMMENDS THAT YOU READ THE ENCLOSED MATERIALS CAREFULLY AND THEN VOTE "FOR" THE PROPOSAL. Your vote is important. PLEASE TAKE A MOMENT NOW TO SIGN AND RETURN YOUR PROXY CARD IN THE ENCLOSED POSTAGE-PAID RETURN ENVELOPE. If we do not receive your signed proxy card after a reasonable amount of time, you may receive a telephone call from our proxy solicitor, Georgeson Shareholder Communications, reminding you to vote your shares. If you prefer, you can fax the proxy card to Georgeson Shareholder Communications, Attn.: ______________, at (___) ___-____. We also encourage you to vote by telephone or through the Internet. Proxies may be voted by telephone by calling (___) ___-____ between the hours of 9:00 a.m. and 10:00 p.m. (Eastern time) or through the Internet using the Internet address located on your proxy card. Voting by fax, telephone or through the Internet will reduce the time and costs associated with the proxy solicitation. When CGF records proxies by telephone or through the Internet, it will use procedures designed to (i) authenticate shareholders' identities, (ii) allow shareholders to authorize the voting of their shares in accordance with their instructions and (iii) confirm that their instructions have been properly recorded. Shareholders voting via the Internet should understand that there may be costs associated with electronic access, such as usage charges from Internet access providers and telephone companies, that must be borne by the shareholder. We have been advised that Internet voting procedures that have been made available to you are consistent with the requirements of applicable law. Whichever voting method you choose, please read the full text of the proxy statement before you vote. If you have any questions regarding the proposed reorganization, please feel free to call Georgeson Shareholder Communications at (___) ___-____ who will be pleased to assist you. IT IS VERY IMPORTANT THAT YOUR VOTING INSTRUCTIONS BE RECEIVED PROMPTLY. Respectfully, James P. McCaughan Chairman of the Board of Directors YOU ARE URGED TO SIGN THE PROXY CARD(S) AND RETURN THE CARD(S) IN THE POSTAGE-PAID ENVELOPE TO ENSURE A QUORUM AT THE MEETING. YOUR VOTE IS IMPORTANT REGARDLESS OF THE SIZE OF YOUR SHAREHOLDINGS. CREDIT SUISSE ASSET MANAGEMENT INCOME FUND, INC. NOTICE OF ANNUAL MEETING OF SHAREHOLDERS To the Shareholders of Credit Suisse Asset Management Income Fund, Inc.: Please take notice that the annual meeting of shareholders of Credit Suisse Asset Management Income Fund, Inc. ("CIK"), a Maryland corporation, will be held at the offices of Credit Suisse Asset Management, LLC, 466 Lexington Avenue, 16th Floor, New York, New York 10017, on Tuesday, May 1, 2001, at 2:00 p.m., Eastern time, for the following purposes: 1. To consider and vote upon the approval of an Agreement and Plan of Reorganization dated as of ________, 2001 between CIK and Credit Suisse Asset Management Strategic Global Income Fund, Inc. ("CGF"), a Maryland corporation, whereby (i) CIK would acquire all the assets and liabilities of CGF, (ii) CIK would issue CIK shares to CGF in exchange therefor, (iii) such CIK shares would be distributed to shareholders of CGF in liquidation of CGF, and (iv) CGF would subsequently be dissolved under Maryland law and de-registered under the Investment Company Act of 1940; 2. To consider and vote upon the approval of a new investment advisory agreement with Credit Suisse Asset Management, LLC; and 3. To consider and vote upon the election of five (5) management nominees standing for election to CIK's Board of Directors; The appointed proxies will vote in their discretion on any other business that may properly come before the annual meeting or any adjournments or postponements thereof. Holders of record of shares of common stock of CIK at the close of business on March 5, 2001 are entitled to vote at the annual meeting and at any postponements or adjournments thereof. CGF shareholders must approve the reorganization as well. The persons named as proxies or the Chairman of the meeting may propose one or more adjournments of the annual meeting if the necessary quorum to transact business or the vote required to approve or reject any proposal is not obtained at the meeting. Unless it is approved by the Chairman of the meeting, any such adjournment will require the affirmative vote of the holders of a majority of CIK's shares present in person or by proxy at the annual meeting. The persons named as proxies will vote those proxies which they are entitled to vote on any such proposal in accordance with their best judgment in the interest of CIK. The enclosed proxy is being solicited on behalf of the Board of Directors of CIK. By Order of the Board of Directors, Michael A. Pignataro, Chief Financial Officer and Secretary ____________, 2001 IMPORTANT--WE URGE YOU TO SIGN AND DATE THE ENCLOSED PROXY CARD AND RETURN THE CARD IN THE ENCLOSED ADDRESSED ENVELOPE WHICH REQUIRES NO POSTAGE AND IS INTENDED FOR YOUR CONVENIENCE. YOUR PROMPT RETURN OF THE ENCLOSED PROXY CARD MAY SAVE THE NECESSITY AND EXPENSE OF FURTHER SOLICITATIONS TO ENSURE A QUORUM AT THE MEETING. IF YOU CAN ATTEND THE MEETING AND WISH TO VOTE YOUR SHARES IN PERSON AT THAT TIME, YOU WILL BE ABLE TO DO SO. CREDIT SUISSE ASSET MANAGEMENT STRATEGIC GLOBAL INCOME FUND, INC. NOTICE OF SPECIAL MEETING OF SHAREHOLDERS To the Shareholders of Credit Suisse Asset Management Strategic Global Income Fund, Inc.: Please take notice that a special meeting of shareholders of Credit Suisse Asset Management Strategic Global Income Fund, Inc. ("CGF"), a Maryland corporation, will be held at the offices of Credit Suisse Asset Management, LLC, 466 Lexington Avenue, 16th Floor, New York, New York 10017, on Tuesday, May 1, 2001, at 3:00 p.m., Eastern time, for the following purpose: 1. To consider and vote upon the approval of an Agreement and Plan of Reorganization dated as of ________, 2001 between CGF and Credit Suisse Asset Management Income Fund, Inc. ("CIK"), a Maryland corporation, whereby (i) CIK would acquire all the assets and liabilities of CGF, (ii) CIK would issue CIK shares to CGF in exchange therefor, (iii) such CIK shares would be distributed to shareholders of CGF in liquidation of CGF, and (iv) CGF would subsequently be dissolved under Maryland law and de-registered under the Investment Company Act of 1940. The appointed proxies will vote in their discretion on any other business that may properly come before the special meeting or any adjournments or postponements thereof. Holders of record of shares of common stock of CGF at the close of business on March 5, 2001 are entitled to vote at the special meeting and at any postponements or adjournments thereof. CIK shareholders must approve the reorganization as well. The persons named as proxies or the Chairman of the meeting may propose one or more adjournments of the special meeting if the necessary quorum to transact business or the vote required to approve or reject any proposal is not obtained at the meeting. Unless it is approved by the Chairman of the meeting, any such adjournment will require the affirmative vote of the holders of a majority of CGF's shares present in person or by proxy at the special meeting. The persons named as proxies will vote those proxies which they are entitled to vote on any such proposal in accordance with their best judgment in the interest of CGF. The enclosed proxy is being solicited on behalf of the Board of Directors of CGF. By Order of the Board of Directors, Michael A. Pignataro, Chief Financial Officer and Secretary ____________, 2001 IMPORTANT--WE URGE YOU TO SIGN AND DATE THE ENCLOSED PROXY CARD(S) AND RETURN THE CARD IN THE ENCLOSED ADDRESSED ENVELOPE WHICH REQUIRES NO POSTAGE AND IS INTENDED FOR YOUR CONVENIENCE. YOUR PROMPT RETURN OF THE ENCLOSED PROXY CARD MAY SAVE THE NECESSITY AND EXPENSE OF FURTHER SOLICITATIONS TO ENSURE A QUORUM AT THE MEETING. IF YOU CAN ATTEND THE MEETING AND WISH TO VOTE YOUR SHARES IN PERSON AT THAT TIME, YOU WILL BE ABLE TO DO SO. Subject to Completion, dated March 2, 2001 Acquisition of the Assets of CREDIT SUISSE ASSET MANAGEMENT STRATEGIC GLOBAL INCOME FUND, INC. 466 LEXINGTON AVENUE, 16TH FLOOR NEW YORK, NEW YORK 10017 (212) 875-3500 By and In Exchange for Shares of CREDIT SUISSE ASSET MANAGEMENT INCOME FUND, INC. 466 LEXINGTON AVENUE, 16TH FLOOR NEW YORK, NEW YORK 10017 (212) 875-3500 COMBINED PROXY STATEMENT FOR MEETINGS OF SHAREHOLDERS TO BE HELD TUESDAY MAY 1, 2001 PROSPECTUS FOR CREDIT SUISSE ASSET MANAGEMENT INCOME FUND, INC. This Combined Proxy Statement/Prospectus ("Proxy Statement/Prospectus") is being furnished to shareholders of Credit Suisse Asset Management Income Fund, Inc. ("CIK" or, as the Reorganization goes forward, the "Surviving Fund") for use at CIK's annual meeting of shareholders to be held Tuesday, May 1, 2001 at 3:00 p.m. (Eastern time) and is being furnished to shareholders of Credit Suisse Asset Management Strategic Global Income Fund, Inc. ("CGF") for use at a special meeting of CGF shareholders to be held on Tuesday, May 1, 2001 at 2:00 p.m., (Eastern time). The meeting of shareholders of each fund will be held at the offices of Credit Suisse Asset Management, LLC, 466 Lexington Avenue, 16th Floor, New York, New York 10017. CGF and CIK are sometimes collectively referred to as the "Funds" and individually, as the context may require, as a "Fund." The approximate mailing date of this Proxy Statement/Prospectus is _________, 2001. Purpose of the Meetings. At each of the meetings, shareholders of the Funds will be asked to approve an Agreement and Plan of Reorganization dated as of ________, 2001. The Agreement and Plan of Reorganization is referred to in this Proxy Statement/Prospectus as the "Plan." In addition, CIK's shareholders are being asked to approve a new investment advisory agreement with Credit Suisse Asset Management LLC (referred to in this Proxy Statement/Prospectus as "CSAM"), and to vote on the election of five (5) directors. Specifics of the Proposed Reorganization. The Plan provides for all the assets of CGF to be acquired by CIK in exchange for CIK shares and the assumption by CIK of all of the liabilities of CGF, hereinafter referred to as the "Reorganization." CIK shares would be distributed to CGF shareholders in liquidation of CGF and thereafter CGF would be dissolved under Maryland law and de-registered under the Investment Company Act of 1940, as amended (the "Investment Company Act"). As a result of the reorganization, each CGF shareholder would receive that number of CIK shares having an aggregate net asset value equal to the aggregate net asset value of such shareholder's CGF shares as of the close of business on the closing of the reorganization (except that cash will be paid in lieu of fractional shares). CGF shareholders will not receive any fractional shares of CIK as part of the CGF distribution. In lieu thereof, CGF will receive from CIK for distribution to its shareholders cash in an amount equal to the aggregate net asset value of the fractional shares otherwise distributable to the CGF shareholders, and the total number of CIK shares otherwise issuable to CGF will be reduced by that number of CIK shares having an aggregate net asset value equal to the cash so paid to CGF. New Investment Advisory Agreement (for CIK shareholders only). Shareholders of CIK are also being asked to approve a new investment advisory agreement with CIK's investment adviser, CSAM. The new agreement will be substantially the same as the current agreement except that the investment advisory fee will be based upon the lower of the average weekly stock price (market value) of the Surviving Fund's outstanding shares or its average weekly net assets. The new investment advisory agreement with CSAM, which is more fully described in this Proxy Statement/Prospectus, will take effect only upon the consummation of the Reorganization. The terms and conditions of the Reorganization and related transactions are more fully described in this Proxy Statement/Prospectus and in the Plan, a copy of which is attached as Exhibit A. This Proxy Statement/Prospectus serves as a prospectus for shares of CIK under the Securities Act of 1933, as amended, which is referred to in this Proxy Statement/Prospectus as the "Securities Act," in connection with the issuance of CIK common shares in the Reorganization. Assuming the shareholders of the Funds approve the Reorganization and all other conditions to the consummation of the Reorganization have been satisfied or waived, the Funds will jointly file Articles of Transfer with the State Department of Assessments and Taxation of Maryland (the "Department"). The Reorganization will become effective when the Department accepts for record the Articles of Transfer or at such later time, which may not exceed 30 days after the Articles of Transfer are accepted for record, as specified in the Articles of Transfer. The date when the Articles of Transfer are accepted for record, or the later date, is referred to in this Proxy Statement/Prospectus as the "Effective Date." CGF, as soon as practicable after the Effective Date, will terminate its registration under the "Investment Company Act" and dissolve under Maryland law. Election of Directors (for CIK shareholders only). The shareholders of CIK will also be asked to consider and vote upon the election of five (5) management nominees standing for election to CIK's Board of Directors. You should retain this Proxy Statement/Prospectus for future reference as it sets forth concisely information about CGF and CIK that you should know before voting on the proposals described below. A Statement of Additional Information, dated _________, 2001, which is referred to in this Proxy Statement/Prospectus as the "SAI" and which contains additional information about the Reorganization and the Funds, has been filed with the Securities and Exchange Commission, or "SEC". The SAI is incorporated by reference into this Proxy Statement/Prospectus. A copy of the SAI is available upon request, without charge, by calling Georgeson Shareholder Communications, Inc., the Funds' proxy agent, at (800) 223-2064. You may also submit your request in writing to Georgeson Shareholder Communications at 17 State Street, 10th Floor, New York, New York 10004. If you should have any questions regarding the proxy material or how to execute your vote, you may call Georgeson Shareholder Communications at (800) 223-2064. CGF has provided the information included in this Proxy Statement/Prospectus regarding that Fund. CIK has provided the information included in this Proxy Statement/Prospectus regarding that Fund. CGF's shares of common stock currently are listed on the New York Stock Exchange, or NYSE, under the symbol "CGF". CIK's shares of common stock currently are listed on the NYSE under the symbol "CIK". After the Effective Date, the shares of CGF will be removed from listing with the NYSE. Reports, proxy materials and other information concerning each Fund may be inspected at the offices of the NYSE, 20 Broad Street, New York, New York 10005. The SEC has not approved or disapproved these securities or determined if this Proxy Statement/ Prospectus is truthful or complete. To state otherwise is a crime. The date of this Proxy Statement/Prospectus is _________, 2001 TABLE OF CONTENTS Page ---- GENERAL..................................................................3 PROPOSAL 1 (BOTH FUNDS): APPROVAL OF THE AGREEMENT AND PLAN OF REORGANIZATION PURSUANT TO WHICH CIK WILL ACQUIRE ALL THE ASSETS AND LIABILITIES OF CGF...................................................5 Synopsis...........................................................6 Expense Table......................................................9 Financial Highlights..............................................11 Risk Factors and Special Considerations...........................14 Comparison of Investment Objectives and Policies..................17 United States Federal Income Taxes................................24 Information About the Reorganization..............................26 Additional Information About the Funds............................31 Management of the Funds...........................................37 Executive Officers of CSAM........................................40 Experts...........................................................43 Required Vote.....................................................43 Legal Proceedings.................................................43 Legal Opinions....................................................43 PROPOSAL 2 (CREDIT SUISSE ASSET MANAGEMENT INCOME FUND SHAREHOLDERS ONLY): APPROVAL OF NEW INVESTMENT ADVISORY AGREEMENT ......44 Background........................................................44 Board Considerations; Reasons for the New Investment Advisory Agreement................................................44 Information Concerning Credit Suisse Group and CSAM...............45 Description of Current Investment Advisory Agreement..............45 The New Investment Advisory Agreement.............................45 Differences Between the Current and the New Investment Advisory Agreement................................................45 Required Shareholder Vote.........................................46 PROPOSAL 3 (CREDIT SUISSE ASSET MANAGEMENT INCOME FUND SHAREHOLDERS ONLY): ELECTION OF DIRECTORS..............................46 Background........................................................46 Required Shareholder Vote.........................................48 ADDITIONAL INFORMATION..................................................48 -i- EXHIBIT A-FORM OF AGREEMENT AND PLAN OF REORGANIZATION ........................................................A-1 EXHIBIT B-FORM OF NEW CSAM INVESTMENT ADVISORY AGREEMENT...............B-1 APPENDIX A-DESCRIPTION OF RATING CATEGORIES APPENDIX B-AUDIT COMMITTEE CHARTER -ii- GENERAL This Proxy Statement/Prospectus is furnished to the shareholders of the Funds in connection with the solicitation of proxies. The Board of Directors of each Fund is soliciting proxies for use at the meetings. The mailing address for both Funds is 466 Lexington Avenue, 16th Floor, New York, New York 10017. This Proxy Statement/Prospectus, the Notice of Meeting to Shareholders and the proxy cards are first being mailed to shareholders on or about _________, 2001 or as soon as practicable thereafter. Any shareholder who gives a proxy has the power to revoke the proxy either: o by mail, addressed to the Secretary of the respective Fund, at the Fund's mailing address, or o in person at the meeting by executing a superseding proxy or by submitting a notice of revocation to the respective Fund. All properly executed proxies received in time for the meetings will be voted as specified in the proxy or, if no specification is made, in favor of each proposal for that Fund referred to in the Proxy Statement/ Prospectus, and in accordance with the judgment of the persons named as proxies on other matters that may properly come before the meetings. Shareholders of CGF and CIK will be asked to vote on the following proposals: Proposal To Be Voted upon by - -------- ------------------- Proposal 1--Approval of the Plan...... CGF and CIK Shareholders Proposal 2--Approval of the New Investment Advisory Agreement with CSAM................... CIK Shareholders Only Proposal 3--Election of five (5) persons to CIK's Board of Directors... CIK Shareholders Only The holders of one-third of the shares of each Fund outstanding at the close of business on the record date, present in person or by proxy, will constitute a quorum for that Fund's meeting. Shares represented by properly executed Proxies that are marked "ABSTAIN" and broker non-votes will be treated as shares that are present only for determining whether a quorum has been achieved at the meeting. In the event that a quorum is not present or represented, the holders of a majority of the shares present in person or by proxy or the Chairman of the meeting may adjourn the meeting, without notice other than announcement at the meeting, until the requisite number of shares entitled to vote at the meeting shall be present. If a quorum is present, but sufficient votes to approve one or more of the proposed items are not received, the persons named as proxies or the Chairman of the meeting may propose one or more adjournments of the meeting to permit further solicitations or Proxies. Unless it is approved by the Chairman of the meeting, any such adjournment will require the affirmative vote of a majority of those shares present at the meeting or represented by proxy. When voting on a proposed adjournment, the persons named as proxies will vote thereon in accordance with their best judgment in the interest of the Fund. As the Reorganization is expected to result in the issuance of a number of shares of CIK in excess of 20% of CIK's outstanding shares of common stock, the NYSE listing rules require that Proposal 1 be approved by the affirmative vote of a majority of the votes cast by CIK shareholders, provided also that the number of votes cast on Proposal 1 represent at least a majority of the outstanding shares of CIK. -3- Absent such NYSE rules, the Reorganization would not require approval by the shareholders of CIK. Under Maryland law and CGF's charter, Proposal 1 requires the affirmative vote of a majority of the outstanding shares of common stock of CGF. Proposal 2 to be submitted at the annual meeting of shareholders of CIK requires the affirmative vote of a "majority of outstanding voting securities" of CIK. A "majority of outstanding voting securities" is defined under the Investment Company Act to mean the lesser of o 67% of the voting securities represented at a meeting at which more than 50% of the outstanding voting securities are represented, or o more than 50% of the outstanding voting securities. Proposal 3 to be submitted at the annual meeting of shareholders of CIK requires the affirmative vote of a plurality of the votes cast at such meeting in person or by proxy. Abstentions and broker non-votes will have the effect of a "no" vote on Proposal 1 for CGF and will not count as CIK shares voted for purposes of measuring whether the NYSE listing rule requirement that the the total CIK votes cast on Proposal 1 represent a majority of the outstanding shares of CIK has been met or whether a majority of the CIK votes cast have been voted in favor of Proposal 1. Abstentions and broker non-votes will have the effect of a "no" vote on Proposal 2 and will have no effect on Proposal 3. 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 Funds, CSAM, Brown Brothers Harriman & Co., the administrator to the Funds, or Georgeson Shareholder Communications, the proxy solicitation firm retained by each Fund in connection with the meetings. Georgeson is entitled to receive a fee of $5,000 per Fund and an additional $15,000 per Fund if the Plan is approved, plus per call charges and reimbursement for its reasonable expenses. The Funds will bear costs of solicitation, including: o printing and mailing of this Proxy Statement/Prospectus and accompanying material, o the reimbursement of brokerage firms and others for their expenses in forwarding solicitation material to the beneficial owners of each Fund's shares, o payment to Georgeson Shareholder Communications for its services in soliciting proxies, and o supplementary solicitations to submit proxies. Only shareholders of record of each Fund at the close of business on March 5, 2001, the Record Date, are entitled to vote. Each outstanding share of a Fund is entitled to one vote on all matters voted upon at a meeting of the shareholders of that Fund. As of March 5, 2001, there were [34,708,369] shares of CIK outstanding, and [11,976,699] shares of CGF outstanding. CGF and CIK provide periodic reports to all of their shareholders. These reports highlight relevant information including investment results and a review of portfolio changes for each Fund. CIK and CGF have previously furnished their respective annual report containing audited financial statements for the year ended December 31, 2000 to their shareholders. CIK and CGF will furnish, without charge, a copy of their most recent Annual Report and of any more recent interim report upon request to Georgeson -4- Shareholder Communications at 17 State Street, 10th Floor, New York, New York 10004 or at (800) 223-2064. These requests will be honored within three business days of receipt. The Boards of Directors of the Funds know of no business other than the proposals described above which will be presented for consideration at the meetings. If any other matter is properly presented, it is the intention of the persons named in the enclosed proxy to vote on that matter in their discretion. PROPOSAL 1 (BOTH FUNDS): APPROVAL OF THE AGREEMENT AND PLAN OF REORGANIZATION PURSUANT TO WHICH CIK WILL ACQUIRE ALL THE ASSETS AND LIABILITIES OF CGF On February 21, 2001, the Boards of Directors of CGF and CIK, including a majority of the directors of each Fund who are not "interested persons" of the respective Fund, or the Independent Directors, unanimously: o declared the Reorganization advisable, o approved entering into the Plan, and o recommended that the Plan be approved by the shareholders of each Fund. The Board of Directors of CGF and CIK have common members. For more information about the Reorganization, see "Information About The Reorganization." The Plan is subject to the approval of the shareholders of both Funds and certain other conditions. A copy of the Plan is attached to this Proxy Statement/Prospectus as Exhibit A, and the description of the Plan included in this Prospectus/Proxy Statement is qualified in its entirety by reference to Exhibit A. The following provides a more detailed discussion about the Reorganization, each Fund and additional information that you may find helpful in deciding how to vote on the Plan. -5- Synopsis This synopsis highlights important information included in this Proxy Statement/Prospectus. This synopsis is qualified by reference to the more complete information included elsewhere in this Proxy Statement/Prospectus and the Plan. Shareholders of the Funds should read this entire Proxy Statement/ Prospectus carefully. The Proposed Reorganization. The Boards of Directors of CGF and CIK, including the Independent Directors of each Fund, have unanimously approved the Plan. The Plan provides for a reorganization of CGF and CIK whereby CIK will acquire all the assets of CGF in exchange for CIK shares and the assumption by CIK of all the liabilities of CGF. The Plan also calls for the distribution of these shares of CIK to CGF's shareholders in liquidation of CGF and the subsequent dissolution of CGF. The reorganization is referred to in this Proxy Statement/Prospectus as the "Reorganization." If approved, the Reorganization is expected to be consummated promptly after the meetings. As a result of the Reorganization, each shareholder of CGF will become a shareholder of the Surviving Fund and will receive, on the Effective Date, that number of full shares of common stock of the Surviving Fund (plus cash in lieu of fractional shares) having an aggregate net asset value equal to the aggregate net asset value of such shareholder's shares held in CGF as of the close of business on the Business Day preceding the Effective Date. For the reasons set forth below under "Information about the Reorganization--Reasons for the Reorganization." the Board of Directors of CIK and CGF, including the Independent Directors of each Fund, have unanimously concluded that: o the Reorganization is in the best interests of each respective Fund, and o the interests of existing shareholders of each respective Fund will not be diluted as a result of the transactions contemplated by the Plan. Accordingly, the Board of Directors of each Fund (which have common members) recommends approval of the Reorganization. If the Reorganization is not approved, each Fund will continue as a separate investment company, and the Board of Directors of each Fund will consider such other alternatives as it determines to be in the best interests of its shareholders. Investment Objectives and Policies. The Funds have substantially similar investment objectives and policies. CIK's fundamental investment objective is current income consistent with the preservation of capital. CGF's fundamental investment objective is high current income consistent with the preservation of capital. In pursuing their respective investment objectives, CIK has a policy of investing at least 75% of its total assets in fixed-income securities, such as bonds, debentures and preferred stocks, while CGF has a policy of investing at least 65% of its total assets in income-producing securities. In February 1997, the Board of Directors of CGF adopted a non-fundamental policy pursuant to which CGF may invest up to 35% of its net assets in the securities of issuers located in emerging markets. In February 2001, the Board of Directors of CIK adopted this same non-fundamental policy after determining that it could enhance CIK's ability to achieve its investment objective. The preceding summary of the Funds' investment objectives and certain policies should be considered in conjunction with the discussion below under "Risk Factors and Special Considerations" and "Comparison of Investment Objectives and Policies." Fees and Expenses. CSAM serves as the investment adviser to each Fund. As compensation for its advisory services, CSAM is entitled to receive from each Fund an annual fee, calculated weekly and -6- paid quarterly, equal to 0.50% of such Fund's average weekly net assets. For the fiscal year ended December 31, 2000, CSAM earned $471,683 in advisory fees from CGF and $1,148,861 from CIK. On __________, 2001, CIK's Board of Directors approved a new investment advisory agreement with CSAM, subject to shareholder approval and consummation of the Reorganization. The new investment advisory agreement with CSAM will be the same as the Fund's current investment advisory agreement except that the investment advisory fee will be equal to a percentage of the lower of the average weekly stock price (market value) of the Fund's outstanding shares or its average weekly net assets. For more information about the new investment advisory agreement, see "Proposal 2 (Credit Suisse Asset Management Income Fund Shareholders Only): Approval of New Investment Advisory Agreement." For the fiscal year ended December 31, 2000, CGF's and CIK's total expense ratios were 1.05% and .78%, respectively. The total expense ratio is the ratio of total annual operating expenses to average net assets. The pro forma expense ratio of the Surviving Fund is estimated to be approximately .77% after giving effect to the Reorganization. The actual expense ratio for the Surviving Fund for the current and subsequent fiscal years, if the Reorganization occurs, may be higher or lower than this projection and will depend upon the Surviving Fund's performance, general bond market and economic conditions, net asset levels, interest rate levels and other factors. See "Expense Table" below for the current expenses of each Fund and pro forma expenses following the Reorganization. Federal Income Tax Consequences of the Reorganization. As a condition to the closing of the Reorganization, both Funds will receive an opinion of Willkie Farr & Gallagher, counsel to the Funds and CSAM, stating that the Reorganization will constitute a tax-free reorganization within the meaning of Section 368(a)(1) of the Internal Revenue Code of 1986, or the Code. Accordingly, neither CIK, CGF nor the shareholders of either Fund should recognize any gain or loss for federal income tax purposes as a result of the Reorganization, except with respect to the shareholders of CGF who receive cash proceeds from the purchase of fractional share interests by the Surviving Fund. These shareholders will be treated for federal income tax purposes as if they received such fractional share interests and then sold such interests for cash. The holding period and the aggregate tax basis of CIK shares (including fractional share interests purchased by the Surviving Fund) received by a CGF shareholder will be the same as the holding period and aggregate tax basis of the shares of CGF previously held by the shareholder. The holding period and the aggregate tax basis of the assets received by CIK in the Reorganization will be the same as the holding period and the tax basis of such assets in the hands of CGF immediately before the Reorganization. For more information about the tax consequences of the Reorganization, see "Information about the Reorganization--Tax Considerations." Discount from Net Asset Value. Shares of closed-end funds frequently trade at a market price that is less than the value of the fund's net assets. The possibility that shares of the Surviving Fund will trade at a discount from its net asset value is a risk separate and distinct from the risk that the Fund's net asset value will decrease. Since the commencement of operations, CIK shares have generally traded in the market at a discount to net asset value, although recently they have traded at a premium. Similarly, CGF shares have generally traded in the market at a discount to net asset value, although recently this discount has substantially narrowed. As of February 21, 2001, the last trading day immediately before the announcement of the Reorganization, and _________, 2001, CIK shares traded at a premium of 8.94% and ______%, respectively. As of those same dates, CGF shares traded at a discount of 2.14% and _______%, respectively. See "Additional Information about the Funds--Discount to Net Asset Value." -7- Disparity in CGF and CIK Discount/Premium Levels. Recently, the shares of CIK have been trading at a premium to net asset value. In contrast, as of the date of this Proxy Statement/Prospectus, the shares of CGF are trading at a small discount to net asset value. If this pattern continues, the total market value of CIK shares issued to CGF shareholders on the Effective Date will be more than the total market value of CGF shares outstanding immediately prior to the Effective Date, although their total net asset values will be the same (disregarding fractional shares). The current disparity of discount/premium patterns would cause CGF shareholders to receive shares in the Reorganization with a higher aggregate market value, but the relative discount level of the Funds may be different at the time the Reorganization occurs. While it is not possible to predict the effect, if any, of the Reorganization on the market price of CIK's shares relative to net asset value, it is possible that CIK's shares will trade at a smaller premium or at a discount following the Reorganization. In fact, the acquisition by a fund whose shares are trading at a premium of the assets of a fund whose shares are trading at a discount could have an adverse effect on the acquiring fund's relative share price, as market participants seek to take advantage of the disparity. Such an acquisition could also have a positive effect on the relative share price of the selling fund, but the same market factors that cause the selling fund's shares to trade at a lower relative share price could affect the acquiring fund once the acquisition takes place. However, CSAM and the CIK Board both believe that the long-term expected benefits of the Reorganization, which are more certain to occur, outweigh the uncertain, unpredictable and potentially short-term effect of the Reorganization on the relative market price of CIK's shares. CSAM and the Boards also believe that an increase in asset size, an increase in the number of outstanding shares and a reduction in expense ratio, all of which CIK is expected to enjoy as the surviving fund as a result of the Reorganization, are not the kinds of developments that should aversely affect a closed-end fund's relative share price over the long term. For more information, see "Additional Information about the Funds--Discount to Net Asset Value." Expenses of the Reorganization. In evaluating the proposed Reorganization, CSAM has estimated the amount of expenses the Funds would incur, including NYSE listing fees, SEC registration fees, legal and accounting fees and proxy and distribution costs. The estimated total expenses pertaining to the Reorganization are approximately $600,000. The aggregate expenses of the Reorganization will be allocated equally between the Funds, including the SEC registration fees and the fees for listing additional shares of CIK on the NYSE. The expenses of the Reorganization are expected to result in a reduction in CGF's net asset value per share of approximately $.2504, and a reduction in CIK's net asset value per share of approximately $.00864. -8- Expense Table
Pro Forma CGF CIK Post-Reorganization --------- --------- ------------------- SHAREHOLDER TRANSACTION EXPENSES Sales Load (as a percentage of offering price).................................. NONE NONE NONE Dividend Reinvestment and Cash Purchase Plan Fees............................... $ 5.00 (1) $ 5.00 (1) $ 5.00 (1) ANNUAL FUND OPERATING EXPENSES (AS A PERCENTAGE OF AVERAGE NET ASSETS)(2) Investment Management Fees.................. 0.50% (3) 0.50%(3) 0.50%(3) Interest Payments on Borrowed Funds......... 0 0 0 Other Expenses(4)........................... 0.55% 0.28% 0.27% Total Annual Expenses(5).................... 1.05% 0.78% 0.77%
- --------------- (1) For optional cash purchases. First time investors are subject to an initial service charge of $10. (2) The percentages in the above table expressing annual fund operating expenses are based on each Fund's operating expenses for the fiscal year ended December 31, 2000. (3) For more information about each Fund's investment management fees, see "Synopsis--Fees and Expenses--Credit Suisse Asset Management Strategic Global Income Fund" and "Synopsis--Fees and Expenses-- Credit Suisse Asset Management Income Fund." (4) Based on actual expenses incurred in 2000. "Other Expenses" include fees for shareholder services, custody, legal and accounting services, printing costs, the costs involved in communications with shareholders and the costs of regulatory compliance, maintaining corporate existence and the listing of the shares of common stock on the NYSE. These figures do not reflect the expenses of the Reorganization. (5) Total annual expenses for the fiscal year 2001 are estimated to represent .82% of net assets for CIK and 1.10% of net assets for CGF without giving effect to the Reorganization. -9- Example. The purpose of the following example is to help you understand the costs and expenses you may bear as an investor. This example is based on the level of total annual operating expenses for each Fund listed in the table above, the total expenses relating to a $1,000 investment, assuming a 5% annual return and reinvestment of all dividends and distributions. Shareholders do not pay these expenses directly; they are paid by the Funds before they distribute net investment income to shareholders. This example should not be considered a representation of future expenses, and actual expenses may be greater or less than those shown. Federal regulations require the example to assume a 5% annual return, but actual annual returns may vary. Pro Forma CGF CIK Post-Reorganization 1 Year........................ $ 11 $ 8 $ 8 3 Years....................... $ 35 $ 26 $ 25 5 Years....................... $ 61 $ 45 $ 44 10 Years...................... $ 139 $ 103 $101 Performance. The table below provides performance data for various periods ended December 31, 2000 for CGF and CIK based on each Fund's net asset value and market value. Past performance is not a guarantee of future results, and it is not possible to predict whether or how investment performance will be affected by the Reorganization.
CGF CIK ---------------------- ---------------------- Average Average Cumulative Annual Cumulative Annual ---------- ------ ---------- ------ Net Asset Value One Year ............. (3.95%) ____% 12.37%) ____% Three Year ........... (7.16%) 2.45% (7.99%) (2.74%) Five Year (1) ........ 19.70% 3.66% 10.23% 1.97% Ten Year ............. 127.34% 8.56% 113.36% 7.87% Market Value One Year ............. 16.11% ____% 3.54% -- Three Year ........... (5.76%) (1.96%) (13.39%) (4.68%) Five Year(1) ......... 28.02% 5.06% 18.03% 3.37% Ten Year ............. 245.98% 13.21% 245.14% 13.19%
- ---------- (1) CSAM replaced CS First Boston Investment Management ("CSFBIM") as investment adviser to each Fund effective June 13, 1995 by virtue of its acquisition of CSFBIM at that time. -10- Financial Highlights The tables below are intended to help you understand the financial performance of CGF and CIK. This information is derived from financial and accounting records of each Fund. This information has been audited by PricewaterhouseCoopers LLP, the Funds' independent public accountants, whose reports, along with the Funds' financial statements, are included in the Funds' Annual Reports to Shareholders and incorporated in the SAI by reference. The Annual Reports may be obtained without charge by writing to Georgeson Shareholder Communications, 17 State Street, 10th Floor, New York, New York 10004, or by calling 1-(800) 223-2064. -11- Credit Suisse Asset Management Strategic Global Income Fund, Inc. Financial Highlights The following table includes per share operating performance data for a share of common stock outstanding, total investment return, ratios to average net assets and other supplemental data for each period indicated. This information has been derived from information provided in the financial statements and market price data for the Fund's shares.
Per Share Operating Performance For a Fund Share Outstanding Throughout Each Period Year Year Year Year Year Year Ended Ended Ended Ended Ended Ended 12/31/00 12/31/99 12/31/98 12/31/97 12/31/96 12/31/95(1) -------- -------- -------- -------- -------- ----------- Net Asset Value, Beginning of Year ......... $ 8.46 $ 9.29 $10.79 $10.37 $10.01 $ 9.26 Offering Costs .......................... -- (0.04) -- -- -- -- Investment Activities: Net Investment Income ................. 0.78 0.89 0.94 0.89 0.91 0.95 Net Realized and Unrealized Gain(Loss) on Investments .......... (1.18) 0.42 (1.49) 0.41 0.26 0.61 ------ ------ ------ ------ ------ ------ Total from Investment Activities ........... (0.40) 1.31 (0.55) 1.30 1.17 1.56 Decrease in Net Asset Value due to Shares Issued through Rights Offering .................... (1.18) Less Distributions: From Net Investment Income .............. (0.94) (0.92) (0.95) (0.88) (0.81) (0.76) In Excess of Net Investment Income ...... -- -- -- -- -- -- From Return of Capital .................. -- -- -- -- -- (0.05) ------ ------ ------ ------ ------ ------ Total Distributions ........................ (0.94) (0.92) (0.95) (0.88) (0.81) (0.81) ====== ====== ====== ====== ====== ====== Net Asset Value, End of Year ............... $ 7.12 $ 8.46 $ 9.29 $10.79 $10.37 $10.01 ====== ====== ====== ====== ====== ====== Per share Market Value, End of Year ........ $ 6.75 $ 6.63 $ 8.63 $10.06 $ 9.00 $ 8.88 ====== ====== ====== ====== ====== ====== Total Investment Return Net Asset Value (2) ..................... (3.95)% 1.89% (5.13)% 13.82% 13.27% 17.57% Market Value ............................ 12.80% (14.03)%(3) (5.56)% 22.34% 11.03% 18.16% Year Year Year Year Ended Ended Ended Ended 12/31/94 12/31/93 12/31/92 12/31/91 -------- -------- -------- -------- Net Asset Value, Beginning of Year ......... $10.45 $ 9.80 $ 9.62 $ 8.70 Offering Costs .......................... -- -- -- -- Investment Activities: Net Investment Income ................. 0.95 1.04 1.22 1.16 Net Realized and Unrealized Gain(Loss) on Investments .......... (1.33) 0.66 0.01 0.96 ------ ------ ------ ------ Total from Investment Activities ........... (0.38) 1.70 1.23 2.12 Decrease in Net Asset Value due to Shares Issued through Rights Offering .................... Less Distributions: From Net Investment Income .............. (0.62) (1.04) (1.05) (1.20) In Excess of Net Investment Income ...... -- (0.01) -- -- From Return of Capital .................. (0.19) -- -- -- ------ ------ ------ ------ Total Distributions ........................ (0.81) (1.05) (1.05) (1.20) ====== ====== ====== ====== Net Asset Value, End of Year ............... $ 9.26 $10.45 $ 9.80 $ 9.62 ====== ====== ====== ====== Per share Market Value, End of Year ........ $ 8.25 $ 9.50 $ 9.50 $10.38 ====== ====== ====== ====== Total Investment Return Net Asset Value (2) ..................... (3.80)% 18.29% 13.28% 25.32% Market Value ............................ (4.72)% 10.94% 3.50% 53.35%
Ratios/Supplemental Data Year Year Year Year Year Year Ended Ended Ended Ended Ended Ended 12/31/00 12/31/99 12/31/98 12/31/97 12/31/96 12/31/95(1) -------- -------- -------- -------- -------- ----------- Net Assets, End of Year (Thousands) ..... $85,332 $101,315 $78,510 $91,914 $87,656 $84,618 Ratio of Expenses to Average Net Assets . 1.05% 1.09% 1.17% 1.10% 1.11% 1.12% Ratio of Net Investment Income to Average Net Assets ............................ 9.85% 10.35% 9.17% 8.43% 8.99% 9.80% Portfolio Turnover Rate ................. 51.1% 41.2% 107.8% 119.1% 65.1% 54.5% Ratios/Supplemental Data Year Year Year Year Ended Ended Ended Ended 12/31/94 12/31/93 12/31/92 12/31/91 -------- -------- -------- -------- Net Assets, End of Year (Thousands) ..... $78,252 $88,319 $82,450 $80,606 Ratio of Expenses to Average Net Assets . 0.99% 1.06% 1.01% 1.00% Ratio of Net Investment Income to Average Net Assets ............................ 9.66% 10.28% 12.34% 12.13% Portfolio Turnover Rate ................. 83.1% 128.5% 107.7% 48.0%
(1) CSAM replaced CS First Boston Investment Management as CGF's investment adviser effective June 13, 1995. (2) Total investment return based on per share net asset value reflects the effects of change in net asset value on the performance of CGF during each period and assumes dividends and capital gains distributions were reinvested. These percentages are not an indication of the performance of a shareholder's investment in CGF based on market value because the market price of the stock and the net asset value of CGF may differ. (3) Excluding the effect of the rights offering completed in 1999, total market value return for that year would have been (12.26)%. Note: Current period permanent book-tax differences, if any, are not included in the calculation of net investment income per share. -12- Credit Suisse Asset Management Income Fund, Inc. Financial Highlights The following table includes per share operating performance data for a share of common stock outstanding, total investment return, ratios to average net assets and other supplemental data for each period indicated. This information has been derived from information provided in the financial statements and market price data for the Fund's shares.
Per Share Operating Performance For a Fund Share Outstanding Throughout Each Period Year Year Year Year Year Ended Ended Ended Ended Ended 12/31/00 12/31/99 12/31/98 12/31/97 12/31/96 ----------- ----------- ----------- ----------- ----------- Net Asset Value, Beginning of Year .... $ 7.34 $ 7.77 $ 8.44 $ 8.12 $ 8.63 Offering Costs ..................... -- -- -- -- (0.02) Investment Activities: Net Investment Income ........... 0.67 0.75 0.71 0.69 0.75 Net Realized and Unrealized Gains or Losses on Investments ...... (1.55) (0.46) (0.66) 0.39 0.18 ----------- ----------- ----------- ----------- ----------- Total from Investment Activities ...... (0.88) 0.29 0.05 1.08 0.93 ----------- ----------- ----------- ----------- ----------- Decrease in Net Asset Value due to shares Issued through Rights Offering ............ (0.52) Less Distributions: From Net Investment Income ......... (0.76) (0.72) (0.72) (0.76) (0.90) ----------- ----------- ----------- ----------- ----------- Total Distributions ................... (0.76) (0.72) (0.72) (0.76) (0.90) =========== =========== =========== =========== =========== Net Asset Value, End of Year .......... $ 5.70 $ 7.34 $ 7.77 $ 8.44 $ 8.12 =========== =========== =========== =========== =========== Per share Market Value, End of Year ... $ 5.56 $ 6.06 $ 7.56 $ 8.75 $ 7.63 =========== =========== =========== =========== =========== Total Investment Return Net Asset Value(2) ................. (12.37)% 4.50% 0.47% 14.03% 10.59% Market Value ....................... 3.55% (11.32)% (5.68)% 25.90% 10.05%(3) Year Year Year Year Year Ended Ended Ended Ended Ended 12/31/95(1) 12/31/94 12/31/93 12/31/92 12/31/91 ----------- ----------- ----------- ----------- ----------- Net Asset Value, Beginning of Year .... $ 8.05 $ 9.00 $ 8.42 $ 8.28 $ 7.25 Offering Costs ..................... -- -- -- -- -- Investment Activities: Net Investment Income ........... 0.86 0.83 0.91 0.89 0.89 Net Realized and Unrealized Gains or Losses on Investments ...... 0.48 (1.06) 0.57 0.08 1.04 ----------- ----------- ----------- ----------- ----------- Total from Investment Activities ...... 1.34 (0.23) 1.48 0.97 1.93 ----------- ----------- ----------- ----------- ----------- Decrease in Net Asset Value due to shares Issued through Rights Offering ............ Less Distributions: From Net Investment Income ......... (0.76) (0.72) (0.90) (0.83) (0.90) ----------- ----------- ----------- ----------- ----------- Total Distributions ................... (0.76) (0.72) (0.90) (0.83) (0.90) =========== =========== =========== =========== =========== Net Asset Value, End of Year .......... $ 8.63 $ 8.05 $ 9.00 $ 8.42 $ 8.28 =========== =========== =========== =========== =========== Per share Market Value, End of Year ... $ 7.88 $ 7.00 $ 8.50 $ 8.38 $ 8.38 =========== =========== =========== =========== =========== Total Investment Return Net Asset Value(2) ................. 17.41% (2.67%) 18.47% 11.95% 27.71% Market Value ....................... 24.34% (9.48%) 12.46% 12.09% 50.81%
Ratios/Supplemental Data Year Year Year Year Year Ended Ended Ended Ended Ended 12/31/00 12/31/1999 12/31/1998 12/31/1997 12/31/1996 ----------- ----------- ----------- ----------- ----------- Net Assets, End of Year (Thousands) ... $ 197,817 $ 254,857 $ 269,507 $ 291,959 $ 280,634 Ratio of Expenses to Average Net Assets 0.78% 0.78% 0.81% 0.84% 0.95% Ratio of Net Investment Income to Average Net Assets(2) .... 10.10% 9.90% 8.59% 8.47% 9.23% Portfolio Turnover Rate ............... 39.1% 43.5% 84.7% 97.7% 81.0% Year Year Year Year Year Ended Ended Ended Ended Ended 12/31/95(2) 12/31/94 12/31/93 12/31/92 12/31/91 ----------- ----------- ----------- ----------- ----------- Net Assets, End of Year (Thousands) ... $ 210,441 $ 196,379 $ 219,355 $ 203,846 $ 199,857 Ratio of Expenses to Average Net Assets 0.92% 0.83% 0.88% 0.86% 0.87% Ratio of Net Investment Income to Average Net Assets(2) .... 10.22% 9.75% 10.34% 10.38% 11.12% Portfolio Turnover Rate ............... 44.1% 70.6% 117.5% 115.2% 53.3%
- ---------- (1) CSAM replaced CS First Boston Investment Management Corporation as CIK's investment adviser effective June 13, 1995. (2) Total investment return based on per share net asset value reflects the effects of change in net asset value on the performance of CIK during each period, and assumes dividends and capital gains distributions were reinvested. These percentages are not an indication of the performance of a shareholder's investment in CIK based on market value because the market value of the stock and the net asset value of CIK may differ. (3) Excluding the effect of the rights offering completed in 1996, total market value for that year would have been 9.53%. Note: Current period permanent book-tax differences, if any, are not included in the calculation of net investment income per share. -13- Risk Factors and Special Considerations Both CGF and CIK are subject to certain risks which are described below. Changes in interest rates may reduce your return on investment. Since the market price of fixed-income securities generally decreases when interest rates rise, the net asset value and market price of your shares may decline if interest rates rise. The magnitude of the decrease will generally be greater for securities with longer maturities and securities with higher yields, which are those in which the Funds primarily invest. This risk may or may not be offset by additional income from new or existing securities carrying higher interest rates. Conversely, if rates decline, you may over time receive less current income from your investment, although the net asset value and market price of your shares may immediately increase. No assurance can be given that the securities purchased by the Funds will continue to earn yields comparable to those earned historically. Market fluctuations may affect the value of your investment. The market value of fixed-income securities may move up and down, sometimes rapidly and unpredictably. These fluctuations, which are often referred to as "volatility," may cause a security to be worth less than it was worth at an earlier time. Volatility may affect a single issuer, industry, sector of the economy or the market as a whole. Volatility affects most investments--including bonds, and the funds that invest in them. The risk of volatility in bond prices can vary significantly depending upon factors such as issuer and maturity. Volatility will affect the net asset value and market price of your shares and may reduce your return on investment. Your investment is exposed to the credit risk inherent in fixed-income securities. The issuer of a debt security may fail to make timely payments of either principal or interest. When holding shares, you indirectly bear this credit risk. A deterioration in financial or general economic conditions usually increases credit risk. Even with investment grade securities, differences exist in credit quality and some investment grade securities may have speculative characteristics. A security's price may be adversely affected by the market's opinion of the security's credit quality level even if the issuer or counterparty has suffered no degradation in its ability to honor the obligation. In addition, the Funds may purchase securities that are in default or not current in the payment of interest or principal. No assurance can be given that issuers whose obligations the Funds acquire will make payments on such obligations as they become due. High yield securities present increased and special risks. High yield securities generally pay a premium above the yields of U.S. government debt securities or mature corporate issuers because they are subject to greater risks than these securities. Hence, high yield securities usually carry a medium-grade or below investment grade rating, which reflects their speculative character and the following risks: o greater volatility o greater credit risk o potentially greater sensitivity to general economic or industry conditions o potential lack of attractive resale opportunities (illiquidity) o additional expenses to seek recovery from issuers who default The market value of lower-rated securities may be more volatile than the market value of higher-rated securities and generally tends to reflect the market's perception of the creditworthiness of the issuer and short-term market developments to a greater extent than more highly rated securities, which reflect primarily fluctuations in general levels of interest rates. -14- Ratings are relative and subjective and not absolute standards of quality. Securities ratings are based largely on the issuer's historical financial condition and the rating agencies' analysis at the time of rating. Consequently, the rating assigned to any particular security is not necessarily a reflection of the issuer's current financial condition. Investing outside the U.S. presents special risks. The risks which CGF faces when it invests in foreign debt securities include: o fluctuations in exchange rates between the U.S. dollar and foreign currencies o unavailable or deficient key information about an issuer, security or market o expropriations, capital or currency controls, punitive taxes or nationalizations o economic policy changes, social and political instability, military action and war Additional risks present when investing outside the U.S. include: o changed circumstances in dealings between nations o greater volatility and illiquidity of foreign securities o costs incurred in connection with conversions between various currencies o higher foreign brokerage commissions o possible extended settlement periods The risks of investing outside the U.S. are compounded for investments in emerging markets. There are greater risks involved in investing in emerging markets than in developed foreign markets, including: o potentially more limited access to investments or less advantageous terms for foreign investors o less-developed securities markets o heightened economic, political and social problems o deficiencies in regulatory oversight, market infrastructure, shareholder protections and company laws o less rigorous and/or enforced accounting, auditing and financial reporting standards and requirements o potential difficulties in enforcing contractual obligations Mortgage-backed securities may reduce current income. Depending on market conditions, mortgage-backed securities may at times constitute a substantial portion of the Funds' portfolio. Mortgage-backed securities are subject to the following risks: o default on the underlying debt -15- o substantial decline in value when interest rates rise o potential lack of attractive resale opportunities (illiquidity) o loss of income due to prepayments and foreclosures The Funds' shares have traded and may continue to trade at a discount to net asset value. Shares of closed-end investment companies frequently trade at a discount to net asset value. This characteristic of shares of a closed-end fund is a risk separate and distinct from the risk that its net asset value may decrease. Since the commencement of operations, the shares of each Fund have generally traded in the market at a discount to net asset value. See "Common Stock." The risk of purchasing shares of a closed-end fund that might trade at a discount is more pronounced for investors who wish to sell their shares in a relatively short period of time. For those investors, realization of a gain or loss on their investments is likely to be more dependent upon the existence of a premium or discount than upon portfolio performance. Other risks may arise from certain investment techniques which the Funds may use. These techniques include repurchase agreements, lending of portfolio securities, short sales, options on U.S. government securities, interest rate futures and related options, direct placement securities, restricted and illiquid securities and foreign exchange currency transactions. For a description of risks associated with these techniques, please see "Other Investment Techniques" in this Proxy Statement/Prospectus beginning on page 22. -16- Comparison of Investment Objectives and Policies Organization. CIK and CGF are both diversified, closed-end management investment companies registered under the Investment Company Act. CGF was organized as a Maryland corporation in 1988 and CIK was organized as a Maryland corporation in 1987. Each Fund's Board of Directors is responsible for the management of the business and affairs of each Fund, including the supervision of the duties performed by each Fund's investment manager. The Funds are managed and advised by CSAM and have Common Directors. The shares of common stock of each Fund are listed and trade on the NYSE. After the Reorganization, CGF's shares will be delisted and CGF will be liquidated and dissolved in accordance with Maryland law and de-registered under the Investment Company Act. The shares of common stock of each Fund have equal non-cumulative voting rights and equal rights with respect to dividends, assets and dissolution. Each Fund's shares of common stock are fully paid and non-assessable and have no preemptive, conversion or other subscription rights. Fluctuations in the market price of the Fund's shares is the principal investment risk of an investment in either Fund. Portfolio management, market conditions, investment policies and other factors affect such fluctuations. Although the investment objectives, policies and restrictions of CIK and CGF are similar, there are differences between them, as discussed below. There can be no assurance that either Fund will achieve its stated objective. Investment Objectives and Policies. CGF and CIK have substantially similar investment objectives and policies. The investment objective of CGF is high current income consistent with the preservation of capital. CGF seeks to achieve this objective by investing in higher yielding U.S. and foreign fixed-income securities, with an emphasis on U.S. high yield (junk bonds) and emerging market securities. At least 65% of CGF's total assets must be invested in income-producing securities. CSAM expects that substantially all of CGF's assets will be invested in income-producing securities. CGF may also invest up to 35% of its net assets in fixed-income securities of issuers located in emerging markets. CIK's investment objective is current income consistent with the preservation of capital. CIK seeks to achieve this objective by investing primarily in fixed-income securities, such as bonds, debentures and preferred stocks. Under normal circumstances, CIK invests at least 75% of its assets in fixed-income securities. Since February 2001, CIK may also invest up to 35% of its net assets in fixed-income securities of issuers located in emerging markets. Both Funds' investments are not subject to any rating quality limitation. Accordingly, each may invest a substantial portion of its assets in securities rated below investment grade by a nationally recognized rating service or unrated but in CSAM's opinion of comparable quality. The investment objectives of CGF and CIK are fundamental policies and cannot be changed without the approval of the holders of a majority of the outstanding voting securities. As used herein, a "majority of the outstanding voting securities" means the lesser of (a) 67% of the shares represented at a meeting at which more than 50% of the outstanding shares are represented or (b) more than 50% of the outstanding shares. No assurance can be given that the investment objective of either Fund will be achieved. For a more detailed discussion of the investment objective and policies, see "Investment Objective and Policies" in the SAI. Recent Repositioning of CIK and CGF's Investment Portfolio. CIK historically has pursued its investment objective by investing principally in high yield fixed income securities of domestic issuers, while investing a relatively small percentage of its net assets in investment-grade debt securities (approximately 15% before the recent portfolio repositioning). CGF has pursued its investment objective by investing not less than 65% of its net assets in domestic high yield securities, and up to 35% of its net assets in emerging markets debt. In February 2001, the Board of Directors of CIK -17- adopted a policy with respect to investments in emerging market debt similar to that of CGF and accepted a recommendation from the investment advisor to partially reposition its portfolio. As a result, CIK is liquidating its investment-grade debt securities portfolio and re-deploying those assets (approximately 15% of the Fund's net assets) in emerging market debt securities. In addition, following a recommendation by the investment advisor, CGF has reduced the percentage of its net assets invested in emerging markets debt to 15% from approximately 35%. As a result of these changes, the Funds have a substantially similar investment mix: approximately 85% of their respective net assets is invested in U.S. high yield fixed-income securities and 15% is invested in fixed-income securities of issuers located in emerging markets. The decision to reposition CIK's portfolio was based on a number of considerations, including CSAM's advice to the CIK Board that: o during the last several years emerging markets debt has matured considerably as a separate asset class, o the movement of the value of emerging markets debt generally does not highly correlate with the movement of the value of domestic high yield debt and thus under current market conditions should result in a less volatile portfolio than one investing solely in domestic high yield securities, and o the repositioning should enhance the overall yield on CIK's portfolio, and thus enable the Board to give consideration to an increase in CIK's dividend rate at some point in the future. The decision to increase CGF's exposure to U.S. high yield fixed-income securities was based on CSAM's advice to the CGF Board that the spreads over investment grade debt afforded by emerging market debt have narrowed, while at present comparable spreads for domestic high yield fixed income securities have remained high. THE FOLLOWING FOUR TABLES ARE ALL AS OF DECEMBER 31, 2000 AND DO NOT REFLECT THE EFFECT OF THE REPOSITIONING OF EACH FUND'S PORTFOLIO APPROVED IN FEBRUARY 2001 AND DESCRIBED ELSEWHERE HEREIN. ACCORDINGLY, SUCH INFORMATION SHOULD NOT BE REGARDED AS REPRESENTATIVE OF THE COMPOSITION OF THE FUNDS' PORTFOLIOS GOING FORWARD. The following table shows the composition of the portfolio of investments of each Fund (as a percentage of net assets) as of December 31, 2000 and on a pro-forma basis after giving effect to the Reorganization: December 31, 2000 Pro forma(1) ------------------------ ------------ CGF CIK Corporate Obligations: 65.2% 88.3% 81.3% Government and Agency Securities: 26.4 0.6 8.5 Collateralized Securities: 0.0 1.0 0.7 Asset Backed Obligations: 0.0 1.4 1.0 Common Stocks: 0.9 1.1 1.0 Preferred Stocks: 1.7 2.6 2.3 Warrants: 0.7 0.6 0.6 - ---------- (1) Does not reflect the effect of the repositioning of each Fund's portfolio which was approved in February 2001. CSAM expects that government and agency securities will represent approximately 15% of the Surviving Fund's net assets after the repositioning is completed. Investments in fixed-income securities are not subject to any rating quality limitation. Accordingly, the Funds may invest a substantial portion of their assets in securities rated below -18- investment grade by a nationally recognized rating service or unrated but in CSAM's opinion of comparable quality. The table below sets forth the percentages of assets invested by each Fund during the fiscal year ended December 31, 2000 in the various Standard & Poor's Rating Group and Moody's Investors Service, Inc. rating categories and in unrated securities determined by CSAM to be of comparable quality. The actual and pro-forma (giving effect to the Reorganization) percentages are based on the dollar-weighted average of credit ratings of all securities held during the fiscal year ended December 31, 2000, computed on a monthly basis. For information regarding the various ratings of Moody's and Standard & Poor's, see the appendix to this prospectus.
Unrated Securities of Rated Securities as a Comparable quality as a percentage of percentage of Rating Category portfolio value portfolio value Total - ----------------------------------- ------------------------- ------------------------- ------------------------- Pro- Pro Pro CGF CIK forma(1) CGF CIK forma(1) CGF CIK forma(1) ----- ----- -------- ----- ----- -------- ----- ----- -------- AAA/Aaa ........................... 0.0% 2.3% 1.6% 0.0% .2% .1% 0.0% 2.5% 1.7% AA/Aa ............................. 0.0% 1.1% 0.8% 0.0% 0.0% 0.0% 0.0% 1.1% .8% A/A ............................... 0.0% 2.6% 1.8% 0.0% 0.0% 0.0% 0.0% 2.6% 1.8% BBB/Baa ........................... 3.0% 7.8% 6.3% 0.0% 0.0% 0.0% 3.0% 7.8% 6.3% BB/Ba ............................. 12.9% 8.0% 9.5% 1.5% 1.4% 1.4% 14.4% 9.4% 10.9% B/B ............................... 59.4% 52.0% 54.2% 5.1% 1.6% 2.7% 64.5% 53.6% 56.9% CCC/Caa ........................... 8.1% 12.3% 11.1% 2.5% 2.5% 2.5% 10.6% 14.8% 13.6% CC/Ca ............................. 0.5% 0.7% 0.6% 0.6% 1.0% .9% 1.1% 1.7% 1.5% C/C ............................... 0.0% 0.1% 0.1% 0.0% 0.0% 0.0% 0.0% .1% .1% D ................................. 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% Subtotal .................... 83.9% 86.9% 86.0% 9.7% 6.7% 7.6% 93.6% 93.6% 93.6% ----- ----- ----- ----- ----- ----- ----- ----- ----- U.S. Government, Equities and Other 6.4% 6.4% 6.4% -- -- -- 6.4 6.4% 6.4% ----- ----- ----- ----- ----- ----- ----- ----- ----- Total ....................... 90.3% 93.3% 92.4% 9.7% 6.7% 7.6% 100.0% 100.0% 100.0% ===== ===== ===== ===== ===== ===== ===== ===== =====
- ---------- (1) Does not reflect the effect of the repositioning of each Fund's portfolio which was approved in February 2001. CSAM expects that the percentage of the surviving Fund's assets invested in securities rated below investment grade or lower or unrated but deemed of comparable quality by CSAM will increase approximately to __% from its pro-forma level as a result of the repositioning. The percentage of the assets of each Fund invested in securities of various grades may from time to time vary substantially from those set forth above. The following table sets forth the composition of each Fund's portfolio by industry as of December 31, 2000 and on a pro-forma basis, after giving effect to the Reorganization: Industry % of Net Assets - ---------------------------------------------- -------------------------------- December 31, 2000 Pro-Forma ---------------------- --------- CGF CIK --------- --------- Aerospace/Defense ............................ 0.3% 0.8% 0.7% Automotive ................................... 1.2% 2.5% 2.1% Broadcasting ................................. 4.8% 4.5% 4.6% Business Services ............................ 1.0% 1.2% 1.1% Cable ........................................ 7.2% 11.2% 10.0% Chemicals .................................... 1.2% 1.7% 1.5% CMO's & Asset Backed Securities .............. 0.0% 2.3% 1.6% Construction & Building Materials ............ 1.2% 1.7% 1.6% Consumer Products & Services ................. 1.8% 2.8% 2.5% Electronics .................................. 1.3% 0.9% 1.0% Energy ....................................... 5.3% 8.0% 7.2% Entertainment ................................ 2.5% 2.1% 2.2% Financial Services ........................... 1.0% 3.4% 2.7% Food & Beverages ............................. 1.5% 2.0% 1.9% Health Care .................................. 0.7% 1.5% 1.2% Industrial ................................... 1.4% 1.9% 1.8% Metals/Mining ................................ 1.2% 1.9% 1.7% Miscellaneous ................................ 0.4% 0.3% 0.3% Packaging/Containers ......................... 2.6% 2.6% 2.6% Paper/Forest Products ........................ 1.9% 2.9% 2.6% Publishing & Information Services ............ 2.1% 2.7% 2.5% Restaurants, Hotels & Gaming ................. 5.6% 6.9% 6.5% -19- Industry % of Net Assets - ---------------------------------------------- -------------------------------- December 31, 2000 Pro-Forma ---------------------- --------- CGF CIK --------- --------- Retail ....................................... 2.0% 4.7% 3.9% Rights, Warrants & Other ..................... 0.7% 0.7% 0.7% Telecommunications ........................... 14.2% 19.8% 18.1% Textiles/Apparel ............................. 0.9% 1.8% 1.5% Transport .................................... 1.3% 1.2% 1.2% Waste Management ............................. 0.0% 0.0% 0.0% ------ ------ ------ Subtotal for Long-term Domestic Investments... 65.3% 94.0% 85.3% ------ ------ ------ Foreign Corporate Obligations ................ 3.1% 1.0% 1.6% Foreign Government Obligations ............... 25.6% 0.1% 7.8% Time Deposit ................................. 2.0% 1.4% 1.6% Net Other Assets ............................. 4.1% 3.5% 3.7% ------ ------ ------ 100.0% 100.0% 100.0% The ten largest holdings (as a percentage of net assets) at December 31, 2000 and on a pro-forma basis, after giving effect to the Reorganization were: CGF - -------------------------------------------------------------------------------- % of Net Position Assets - -------------------------------------------------------------------- ------ 1) Russian Federation, Unsubordinated, 2.50%, 3/31/30 3.8% 2) Federal Republic of Brazil, Bearer Bonds, 11.00%, 8/17/40 2.7% 3) Federal Republic of Brazil, Capitalization Bonds, 8.00%, 4/15/14 2.6% 4) Argentina Bocon PRO1 Notes 2.953%, 4/1/07 2.0% 5) Republic of Agentina, Unsubordinated, 9.75%, 9/19/27 1.5% 6) Republic of Bulgaria Floating Rate Notes 3.00%, 7/28/12 1.3% 7) Republic of Argentina, Foreign Government Gtd., 6.00%, 3/31/23 1.3% 8) United States Treasury Notes 7.25%, 5/15/04 0.9% 9) Ministry Finance of Russia Debentures 3.00%, 5/14/06 0.9% 10) Republic of Argentina, Debentures 7.625%, 3/31/05 0.9% CIK - -------------------------------------------------------------------------------- % of Net Position Assets - -------------------------------------------------------------------- ------ 1) Univision Network Holding L.P. Sub. Notes 7.00%, 12/17/02 1.0% 2) Meditrust Conv. Debentures 7.50%, 3/1/01 1.0% 3) Coinstar, Inc. Sr. Discount Notes 13.00%, 10/1/06 0.9% 4) Telewest Comunications plc, Yankee Sr. Sub. Discount Debentures 0.00%, 10/1/07 0.8% 5) Sprint Spectrum LP/Sprint Spectrum Finance Corp. Sr. Notes 11.00%, 8/15/06 0.8% 6) Ainsworth Lumber Co., Ltd. Yankee Sr. Secured Notes 12.50%, 7/15/07 0.8% 7) Motors & Gears, Inc. Series D, Sr. Notes 10.75%, 11/15/06 0.7% 8) Key Energy Services, Inc., Sr. Sub. Notes 14.00%, 1/15/09 0.7% 9) Station Casinos Sr. Sub. Notes 9.75%, 4/15/07 0.7% 10) Mrs. Fields Original Cookies, Inc. Gtd. Sr. Notes 10.125%, 12/1/04 0.7% Pro forma - -------------------------------------------------------------------------------- % of Position Net Assets - -------------------------------------------------------------------- ---------- 1) Russian Federation, Unsubordinated, 2.25%, 3/31/30 1.2% 2) Federal Republic of Brazil, Bearer Bonds, 11.00%, 8/17/40 0.8% 3) Federal Republic of Brazil, Capitalization Bonds, 8.00%, 4/15/14 0.8% 4) Univision Network, Holding L.P., Sub. Notes, 7.00%, 12/17/02 0.7% 5) Univision Network Holdings LP 0.7% 6) Meditrust Corp Conv Deb 0.7% 7) Coinstar, Inc., Sr. Discount Notes, 13.00%, 10/1/06 0.6% 8) COINSTAR S/UP 0.6% 9) Bocon PROI Notes 2.953%, 4/1/07 0.6% 10) Telewest, Communications plc, Yankee Sr. Sub., Discount Debentures, 0.00%, 10/1/07 0.6% CSAM may take full advantage of the entire range of maturities of fixed-income securities and may adjust the average maturity of the investments held in the portfolio from time to time, depending on -20- its assessment of relative yields of securities of different maturities and its expectations of future changes in interest rates. Investment Techniques U.S. Fixed-Income Securities Both Funds invest in higher-yielding, lower rated U.S. corporate fixed income securities, including debt securities, convertible securities and preferred stocks. They may also invest in securities rated single A or higher by Moody's or by Standard & Poor's and unrated corporate fixed-income securities. Normally substantially all of the high yield securities in which the Funds invest are in the lower-rated categories. Lower-rated securities generally provide yields superior to those of more highly rated securities, but involve greater risks and are speculative in nature. The rating services' descriptions of these rating categories, including the speculative characteristics of the lower categories, are set forth in Appendix A. As of December 31, 2000, corporate fixed-income securities rated below investment grade represented 62.5% of the net assets of CGF and 77.1% of the net assets of CIK. On a pro-forma basis, after the Reorganization but before giving effect to the portfolio repositioning described above such securities would represent _% of the Surviving Fund's net assets. CSAM expects that after the repositioning, these securities would represent _% of the Surviving Fund's net assets. Both Funds may also invest in debt securities issued or guaranteed by the U.S. government, or by agencies or instrumentalities established or sponsored by the U.S. government, including mortgage-backed securities. Depending on market conditions, the Funds may invest a substantial portion of their assets in mortgage-backed securities. Mortgage-backed securities are collateralized by mortgages or interests in mortgages and may be issued by government or non-government entities. Mortgage-backed securities issued by government entities typically provide a monthly payment consisting of interest and principal payments, and additional payments will be made out of unscheduled prepayments of principal. Non-government issued mortgage-backed securities may offer higher yields than those issued by government entities, but may be subject to greater price fluctuations. CSAM may take full advantage of the entire range of maturities of U.S. government securities and may adjust the average maturity of the investments held in the portfolio from time to time, depending on its assessment of relative yields of securities of different maturities and its expectations of future changes in interest rates. To the extent that the Funds invest in the mortgage market, CSAM will evaluate relevant economic, environmental and security-specific variables such as housing starts, coupon and age trends. As of December 31, 2000, CGF did not hold any mortgage-backed securities and these securities represented 1.0% of CIK's net assets. On a pro-forma basis, they would represent _% of the net assets of the Surviving Fund. CSAM does not expect these percentages to change materially as a result of the repositioning. Non-US Dollar Denominated Fixed-Income Securities; Fixed-Income Securities of Foreign Issuers Each Fund invests in debt obligations and other fixed income securities denominated in U.S. dollars, non-U.S. currencies or composite currencies, including: o debt obligations issued or guaranteed by foreign national, provincial, state, municipal or other governments with taxing authority or by their agencies or instrumentalities o debt obligations of supranational entities o debt obligations of the U.S. government issued in non-dollar denominated securities -21- o dollar and non-dollar denominated debt obligations and other fixed-income securities of foreign and U.S. corporate issuers Each Fund may invest up to 35% of its net assets in the securities of issuers located in emerging markets. CIK has a fundamental policy not to invest more than 5% of the value of its total assets in securities denominated in a currency other than the U.S. dollar. As CGF's investments in the securities of issuers located in emerging markets consist almost entirely of U.S. dollar-denominated fixed-income securities, CSAM does not expect that this limitation will impair to any material extent CIK's ability to invest in those markets if the Reorganization is approved. Other Investment Techniques To enhance return as market opportunities arise, the Funds may use the following investment techniques. Associated risks are indicated for each technique. Repurchase Agreements. The Funds may invest in repurchase agreements collateralized by U.S. government securities, certificates of deposit and certain bankers' acceptances for the purpose of realizing additional income. The use of repurchase agreements involves the risk that the counterparty may default on its obligation to repurchase the underlying securities at the agreed upon repurchase price at a time when the value of the underlying securities has declined, thus causing a loss upon their disposition. Securities Lending. The Funds may lend their portfolio securities to banks, brokers, dealers and other financial institutions who may need to borrow securities in order to complete certain transactions, such as covering short sales, avoiding failures to deliver securities or completing arbitrage transactions. Securities lending involves the following risks: o illiquidity o credit Short Sales. Each Fund may engage in short sales (the sale of a security that it does not own). A Fund will only engage in short sales when they own an equal amount of such securities or securities convertible into or exchangeable, without payment of further consideration, for securities of the same issue as, and equal in amount to, the securities sold short ("short sales against the box"), and only if not more than 5% of the net assets is held as collateral for such sales at any one time. Options on U.S. Government Securities. Each Fund may write covered call options (rights to purchase a security from a Fund) and put options (rights to sell a security to a Fund) with respect to its U.S. government securities to hedge against price fluctuations and to increase current income. Each Fund may also purchase put options (right to sell a security to a third party) or call options (right to purchase a security from a third party) on U.S. government securities to protect its portfolio against price fluctuations. These options involve the following risks: o volatility o imperfect correlation between the prices of the option and the underlying security credit o illiquidity o reduced ability to profit from price and interest rate fluctuations on the securities being hedged -22- Interest Rate Futures and Related Options. Each Fund may enter into interest rate futures contracts and options that are traded on U.S. futures exchanges or other trading facilities. Each Fund intends to use these techniques only for bona fide hedging purposes, i.e., for the purpose of protecting its portfolio against yield and price fluctuations. The Funds are not required to hedge their investments. Interest rate futures and related options may not be available or may be too costly, and, as a result, the Funds may not be able to use them when they decide to do so. When used, interest rate futures contracts and related options involve the following risks: o volatility o imperfect correlation between prices o reduced ability to profit from price and interest rate fluctuations on the securities being hedged Restricted and Illiquid Securities. Each Fund may invest up to 10% of its total assets in securities that are not readily marketable. These include securities which are not registered under the Securities Act and not publicly traded. They are usually considered less liquid than publicly-traded securities and the Funds may have to accept a lower price upon a decision to sell such a security or may not be able to sell the security at all. Companies whose securities are not publicly traded may not be subject to the same investor protection requirements as publicly traded securities. Foreign Currency Exchange Transactions. Each Fund may (but is not required to) engage in foreign currency exchange transactions to hedge against fluctuations in future exchange rates. Foreign currency hedging involves the following risks: o imperfect correlation between prices o credit risk o volatility in currency prices o illiquidity o reduced ability to profit from price and interest rate fluctuations on the securities being hedged Each Fund will have a limited ability to hedge its portfolio denominated in currencies of emerging markets against potential devaluations because of the lack of suitable instruments and, even if such instruments are available, may elect not to hedge its currency exposure. Defensive Strategies. There may be times when, in CSAM's judgment, conditions in the securities markets would make pursuing a Fund's basic investment strategy inconsistent with the best interests of its shareholders. At such times, CSAM may employ alternative strategies to reduce fluctuations in the value of the portfolio. In implementing these defensive strategies a Fund may temporarily shift its portfolio emphasis to higher rated securities, hedge currency risks, reduce or suspend its option writing activities or generally reduce the average maturity of its holdings. Under unusual market conditions a Fund could invest for temporary defensive purposes up to 100% of its total assets in cash or money market instruments. Such money market instruments include short-term obligations issued or guaranteed by the U.S. Government or its agencies or instrumentalities, domestic, foreign and non-U.S. dollar denominated commercial paper, domestic and foreign certificates of deposit, domestic and foreign bankers' acceptances and other bank obligations. A Fund may also hold a portion of its assets in cash or -23- money market instruments for liquidity purposes. It is impossible to predict when, or for how long, such alternative strategies will be utilized. To the extent that a Fund employs these temporary defensive strategies, it may not achieve its investment objective. Portfolio Turnover and Short-Term Trading. CSAM will buy and sell securities for a Fund to accomplish its investment objective. The investment policies of a Fund may lead to frequent changes in investments, particularly in periods of rapidly fluctuating interest or currency exchange rates. Investments may also be traded to take advantage of perceived short-term disparities in market values or yields among securities of comparable quality and maturity. From time to time, consistent with its investment objective, a Fund may also trade securities for the purpose of seeking short-term profits to take advantage of short-term opportunities during periods of fluctuating markets. Securities may be sold in anticipation of a market decline or bought in anticipation of a market rise. United States Federal Income Taxes The following information is meant to be a summary of certain federal income tax considerations relevant to an investment in either Fund or, if the Reorganization is consummated, in the Surviving Fund. Please see the SAI for additional information. You should rely on your own tax advisor for advice about the particular federal, state and local tax consequences to you of investing in the Funds. Although each Fund intends to operate so that it will not have to pay federal income or excise tax, if it does have to pay tax, this would adversely affect investment performance. Each Fund will distribute substantially all of its income and gains to shareholders every year, and you will be taxed on distributions you receive, regardless of whether they are paid in cash or are reinvested in shares. If a Fund declares a dividend in October, November or December but pays it in January, you may be taxed on the dividend as if you received it in the previous year. Each Fund will send to its shareholders a tax report each year. The report will tell you which dividends and redemptions must be treated as taxable ordinary income and which, if any, are long-term capital gain. If the Fund designates a dividend as a capital gain distribution, you will pay tax on that dividend at the long-term capital gains tax rate, no matter how long you have held your shares. If you hold your shares in a tax-deferred retirement account, such as an IRA, you generally will not have to pay tax on dividends until they are distributed from the account. These accounts are subject to complex tax rules, and you should consult your tax advisor about investment through a tax-deferred account. You will generally have a capital gain or loss if you sell your shares. The amount of the gain or loss and the rate of tax will depend primarily upon how much you paid for the shares, how much you sell them for, and how long you held them. Each Fund may be required to withhold U.S. federal income tax at the rate of 31% of all taxable distributions payable to you if you fail to provide your correct taxpayer identification number or to make required certifications, or if you have been notified by the IRS that you are subject to backup withholding. Backup withholding is not an additional tax. Any amounts withheld may be credited against your U.S federal income tax liability. Foreign Shareholders. If you are a nonresident alien individual, a foreign trust or estate, a foreign corporation or a foreign partnership under U.S. tax laws, you will be subject to U.S. withholding tax at the rate of 30% (or applicable lower treaty rate) except where such distributions are effectively connected with a trade or business carried on by you in the United States. -24- Under certain circumstances more fully described in the SAI, distributions of net long-term capital gains to you and gains from sales of shares by you may not be subject to U.S. income or withholding taxes. If the income from a Fund is effectively connected with a trade or business carried on by you, distributions of net investment income and net long-term capital gains, and any gains realized upon the sale or redemption of shares, will be subject to U.S. income tax at the graduated rates applicable to U.S. citizens or domestic corporations. If you are entitled to claim the benefits of an applicable tax treaty, the tax consequences to you may be different from those described herein. You are advised to consult your own tax advisor with respect to the particular tax consequences to you of an investment in a Fund. Other Taxation. Income received by a Fund from sources within foreign countries may be subject to withholding and other taxes imposed by such countries. Tax conventions between certain countries and the United States may reduce or eliminate such taxes. It is impossible to determine the effective rate of foreign tax in advance since the amount of assets to be invested in various countries is not known. Distributions also may be subject to additional state, local and foreign taxes depending on your particular situation. You are advised to consult your own tax advisor with respect to the particular tax consequences to you of an investment in a Fund and of the possible impact of proposed changes in applicable tax laws. For a discussion of the tax consequences of the Reorganization on your investment in each Fund, please see "Information about the Reorganization--Tax Considerations." -25- Information About the Reorganization General. Under the Plan, CIK will acquire all the assets of CGF in exchange for CIK shares and the assumption by CIK of all the liabilities of CGF on the Effective Date. As a result of the Reorganization and on the Effective Date, each CGF shareholder would receive that number of CIK shares (plus cash in lieu of fractional shares), having an aggregate net asset value equal to the aggregate net asset value of such shareholder's CGF shares as of the close of business on the Business Day preceding the Effective Date. The Surviving Fund will not issue any fractional shares to CGF shareholders. In lieu thereof, the Surviving Fund will purchase all fractional shares at the current net asset value of the shares and remit the cash proceeds to former shareholders of CGF in proportion to their fractional shares. No sales charge or fee of any kind will be charged to CGF shareholders in connection with their receipt of common stock of the Surviving Fund in the Reorganization. CGF would then: o remove its shares of common stock from listing on the NYSE, o withdraw from registration under the Securities Exchange Act of 1934, as amended, o deregister as an investment company under the Investment Company Act, and o dissolve under Maryland law. If approved, the Reorganization is expected to occur promptly after the meetings. Under Maryland law, shareholders of a corporation whose shares are traded publicly on a national securities exchange, such as the Funds' shares, are not entitled to demand the fair value of their shares upon a Reorganization; therefore, the shareholders of the Funds will be bound by the terms of the Reorganization. However, any shareholder of either Fund may sell his or her shares of common stock at any time prior to the Reorganization on the NYSE. The Plan may be terminated and the Reorganization abandoned, whether before or after approval by the Funds' shareholders, at any time prior to the Effective Date: o by the mutual written consent of the Board of Directors of each Fund, or o by either Fund if the conditions to that Fund's obligations under the Plan have not been satisfied or waived. If the Reorganization has not been consummated by September 30, 2001, the Plan automatically terminates on that date, unless a later date is mutually agreed upon by the Board of Directors of each Fund. Reasons for the Reorganization. The Board of Directors of each Fund informally considered a combination of CIK and CGF over the last several years. The Boards finally considered the combination at joint meetings of each Board held on February 5, 2001, February 9, 2001 and February 14, 2001 and unanimously approved the Reorganization at joint meetings of each Board held on February 21, 2001. The Board of Directors of both Funds have common members and all of the Directors of each Fund were present at each of these meetings. For the reasons discussed below, the Board of Directors of each Fund, including the Independent Directors of each Fund, after consideration of the potential benefits of the Reorganization to the shareholders of that Fund and the expenses expected to be incurred by that Fund in connection with the Reorganization, unanimously determined that: -26- o the interests of the existing shareholders of that Fund will not be diluted as a result of the proposed Reorganization, and o the proposed Reorganization is in the best interests of that Fund. IN THE JUDGMENT OF THE BOARD OF DIRECTORS OF EACH FUND, THE REORGANIZATION SERVES THE BEST INTERESTS OF EACH FUND AND ITS SHAREHOLDERS. The approval and recommendation by each Board of Directors that shareholders vote for the Reorganization springs from a number of issues which the Fund's investment advisor and the Directors have been considering over a period of time. Each Board of Directors has consistently held the view that an increase in the Fund's asset size could potentially benefit the Funds' shareholders in several ways: the expense ratio could be reduced, the Fund's investment flexibility and opportunities could be enhanced and analyst coverage of the Fund perhaps would be expanded or initiated, a factor that the investment advisor has identified as one that may positively affect the discount/premium at which a closed-end fund trades. In deciding to approve the course of action described below, the Independent Directors considered many factors, including but not limited to market information, analyses and advice provided to them by CSAM. In addition, in considering the merits of the proposed Reorganization, the Boards also considered the larger asset size of the combined Fund relative to each constituent Fund standing alone, the newly revised fee structure and the potential for economies of scale that is likely to result from the larger asset size of the combined Fund. Based on data presented by CSAM, the Board of Directors of each Fund believes that a combination of the Funds is likely to result in a total operating expense ratio that will be lower than the current total operating expense ratio of either Fund. The Boards also considered CSAM's representation to them that a larger asset base would provide benefits in portfolio management. After the Reorganization, the Surviving Fund may be better able to diversify portfolio holdings and thereby mitigate risks, while participating in more investment opportunities. In addition, a larger asset size could result in a more liquid trading market for shares of the Surviving Fund than either Fund currently enjoys separately. Further, the Reorganization itself may focus the attention of a wider circle of securities analysts on the Surviving Fund and may eliminate confusion in the marketplace that results from two funds with a similar objective, similar policies and similar names managed by the same adviser. There can be no guarantee that any of these potential beneficial results will be realized. The Board of Directors of each Fund, in declaring advisable and recommending the proposed Reorganization, also considered the following: 2. the capabilities and resources of CSAM and its affiliates in the areas of investment management and shareholder servicing; 3. expense ratios and information regarding fees and expenses of the Funds, both currently and on a pro forma basis, including the new fee arrangement pursuant to which the fees charged by CSAM to the Surviving Fund will be based upon the lower of the average weekly stock price (market value) of the Surviving Fund's outstanding shares or its average weekly net assets; 4. the terms and conditions of the Reorganization and whether it would result in dilution of the interests of either Fund and its existing shareholders; -27- 5. the compatibility of the Fund's portfolio securities, investment objectives, policies and restrictions; 6. the tax consequences to each Fund and its shareholders in connection with the Reorganization; and 7. the anticipated expenses of the Reorganization. In reviewing issues relating to the structure of the Reorganization and the selection of the surviving corporation in the Reorganization, each Board also considered information provided to them by CSAM concerning: o the comparative performance records of the two Funds, o public and market perception of the two Funds, o the relative size of the two Funds, and o the investment policies, strategies and personnel CSAM intends to utilize in managing the combined fund. Each Fund's Board of Directors and CSAM believe that the reorganization is in step with each Fund's objective and consistent with the repositioning of its portfolio. For example, by acquiring the assets of CGF, CIK is expected to be able to better pursue its objective of seeking current income because some of those assets represent higher yielding emerging markets debt. In addition, a portion of CGF's portfolio is comprised of domestic high yield debt that, although still below investment grade, is rated higher than the domestic high yield debt held by CIK. Moreover, studies have shown that adding an international component to a domestic portfolio can help to stabilize it because domestic and international markets will sometimes move in opposite directions. The Boards also considered information provided to them by CSAM which indicated that the yield on the repositioned CGF portfolio was less than the yield on the repositioned CIK portfolio. This information showed that the Reorganization would cause the current yield on the Surviving Fund to be less than the current yield on CIK, at least in the short term. However, the Board considered that the average credit quality of the instruments comprising CGF, although below investment grade, was higher than that of CIK, and that the Surviving Fund's overall total return (which includes both income and capital appreciation or stability) should benefit from such higher average credit quality. The Board was also advised that the relative yields are partly a function of market conditions at the time the various instruments were purchased and that, as compared with receiving a cash infusion which would have to be invested at current rates, the CGF's current yield compared favorably. The Board also considered average portfolio turnover rates and maturity information and concluded that the other benefits of the Reorganization, as described throughout this Proxy/Prospectus, outweigh the short-term reduction in yield. Based on the factors discussed above, the Board of Directors of each Fund concluded that the expenses of the Reorganization are outweighed by the benefits that are anticipated to be derived from the Reorganization. Terms of the Plan. In addition to the terms of the Plan described earlier in this Proxy/Prospectus, the following is a summary of certain terms of the Plan. -28- Generally, the Plan sets forth various representations and warranties of the parties and describes the mechanics of the transaction and includes a number of other conditions to the completion of the Reorganization, such as the requirement that good standing certificates be obtained by each party and that no stop-orders or similar regulatory barriers have been issued by the SEC. For purposes of valuing assets in connection with the Reorganization, the assets of CGF will be valued pursuant to the principles and procedures consistently utilized by CIK, which principles and procedures are also utilized by CGF in valuing its own assets and determining its own liabilities. As a result, it is not expected that CIK's valuation procedures as applied to CGF's portfolio securities will result in any difference from the valuation that would have resulted from the application of CGF's valuation procedures to such securities. The net asset value per share of common stock of the Surviving Fund will be determined in accordance with these principles and procedures, and the Surviving Fund will certify the computations involved. The net asset value per share of each Fund will not be adjusted to take into account differences in unrealized gains and losses. The Surviving Fund will issue separate certificates or share deposit receipts for common stock of the Surviving Fund to shareholders of CGF. The Surviving Fund will deliver these certificates or share deposit receipts representing shares of common stock of the Surviving Fund to Fleet National Bank c/o EquiServe, L.P., as the transfer agent and registrar for common stock of the Surviving Fund. The Surviving Fund will not permit any CGF shareholder to receive new certificates representing shares of common stock of the Surviving Fund until the shareholder has surrendered his or her outstanding certificates representing shares of the common stock of CGF or, in the event of lost certificates, posted adequate bond. CGF will request its shareholders to surrender their outstanding certificates representing shares of the common stock of CGF or post adequate bond therefor. Dividends payable to holders of record of shares of the Surviving Fund as of any date after the Effective Date and prior to the exchange of certificates by any shareholder of CGF will be paid to such shareholder, without interest; however, such dividends will not be paid unless and until such shareholder surrenders his or her stock certificates of CGF for exchange. PLEASE DO NOT SEND IN ANY STOCK CERTIFICATES AT THIS TIME. UPON CONSUMMATION OF THE REORGANIZATION, SHAREHOLDERS OF CGF WILL BE FURNISHED WITH INSTRUCTIONS FOR EXCHANGING THEIR STOCK CERTIFICATES FOR STOCK CERTIFICATES OF THE SURVIVING FUND. The net asset value of the shares of the Surviving Fund received by CGF shareholders plus the cash amounts received upon the purchase of fractional share interests by the Surviving Fund will equal the net asset value of the CGF shares exchanged. The Plan may be terminated at any time prior to the Effective Date by mutual agreement of each Fund's Board of Directors or by either Fund if any of the obligations of the other Fund have not been fulfilled or waived or if the other Fund has made a material and intentional misrepresentation. The Plan will automatically terminate after September 30, 2001 if the Reorganization has not been consummated, unless such time is extended by mutual agreement of the Board of Directors of each Fund. The Plan may be amended, modified or supplemented by mutual agreement of CIK and CGF. However, no amendments which would have the effect of changing the provisions for determining the number of shares issued to CGF shareholders will be permitted following the special meeting unless those shareholders consent to the amendment. Expenses of the Reorganization. In evaluating the proposed Reorganization, CSAM has estimated the amount of expenses the Funds would incur, including NYSE listing fees, SEC registration fees, legal and accounting fees and proxy and distribution costs. The estimated total expenses pertaining -29- to the Reorganization are $600,000. For more information about the expenses of the Reorganization, See "Synopsis--Expenses of the Reorganization." The expenses of the Reorganization are expected to result in a reduction in CGF's net asset value per share of approximately $.02504, and a reduction in CIK's net asset value per share of approximately $.00864. Tax Considerations. The Plan and Reorganization are conditioned upon the receipt by the Funds of an opinion from Willkie Farr & Gallagher, counsel to the Funds, substantially to the effect that, based upon the facts, assumptions and representations of the parties, for federal income tax purposes: o the Reorganization will constitute a tax-free "reorganization" within the meaning of Section 368(a)(1) of the Code, and each Fund will be "a party to a reorganization" within the meaning of Section 368(b) of the Code, o no gain or loss will be recognized by either Fund as a result of the Reorganization, o the basis of the assets of CGF in the hands of the Surviving Fund will be the same as the basis of such assets to CGF immediately prior to the Reorganization, o the holding period of the assets of CGF in the hands of the Surviving Fund will include the period during which such assets were held by CGF, o no gain or loss will be recognized by the shareholders of CGF upon the conversion of their CGF shares into common stock of the Surviving Fund except with respect to cash received upon the purchase of fractional share interests by the Surviving Fund, o the basis of shares of the Surviving Fund received by each shareholder of CGF (including any fractional share interests purchased by the Surviving Fund) will be the same as the basis of the shares of CGF exchanged therefor, o the holding period of shares of the Surviving Fund received by each shareholder of CGF (including any fractional share interests purchased by the Surviving Fund) will include the holding period during which the shares of CGF exchanged therefor were held, provided that at the time of the exchange the shares of CGF were held as capital assets in the hands of such shareholder of CGF, and o cash received for fractional share interests purchased by the Surviving Fund will generate gain or loss to shareholders receiving such cash. While CGF is not aware of any adverse state or local tax consequences of the proposed Reorganization, it has not requested any ruling or opinion with respect to such consequences and shareholders may wish to consult their own tax advisors with respect to such matters. -30- Additional Information About the Funds Description of Securities to Be Issued. The authorized stock of CIK consists of 100,000,000 shares of common stock, U.S.$0.001 par value. Shares of CIK entitle its holders to one vote per share. Holders of CIK's common stock are entitled to share equally in dividends authorized by the Fund's Board of Directors payable to the holders of such common stock and in the net assets of CIK available for distribution to holders of such common stock. Shares have noncumulative voting rights and no conversion, preemptive or other subscription rights, and are not redeemable. The outstanding shares of common stock of CIK are fully paid and non-assessable. In the event of liquidation, each share of common stock is entitled to its proportion of the Fund's assets after payment of debts and expenses. CIK holds shareholder meetings annually as required by the rules of the NYSE. The following table shows information about the common stock of each Fund as of _____, 2001.
(4) (3) Amount Issued (1) (2) Amount held by Fund and Outstanding Exclusive of Title of Class Amount Authorized for its Own Account Amount Shown Under (3) -------------- ----------------- ------------------- ---------------------------- CGF Common Stock 100,000,000 None 11,976,699 $0.001 par value CIK Common Stock, 100,000,000 None 34,708,369 $0.001 par value
The shares of common stock of CGF and CIK are listed and trade on the NYSE under the symbols "CGF" and "CIK", respectively. As of _______, 2001, the net asset value per share of CGF common stock was $___, and the market price per share was $___. As of that same date, the net asset value per share of CIK common stock was $___, and the market price per share was $___. Discount to Net Asset Value. Shares of closed-end investment companies, such as the Funds, have frequently traded at a discount from net asset value. This characteristic is a risk separate and distinct from the risk that the Funds' net asset values may decrease, and this risk may be greater for shareholders expecting to sell their shares in a relatively short period. THE SHARES OF COMMON STOCK OF THE FUNDS SHOULD THUS BE VIEWED AS BEING DESIGNED PRIMARILY FOR LONG-TERM INVESTORS AND SHOULD NOT BE CONSIDERED A VEHICLE FOR TRADING PURPOSES. During the period since the inception of the Funds, the common stock of both Funds has generally traded at a discount to net asset value, although CIK has frequently traded at a premium to net asset value. It is not possible to state whether shares of the Surviving Fund will trade at a premium or discount to net asset value following the Reorganization, or the extent of any such premium or discount. The Directors of both Funds have regularly considered, and the Directors of the Surviving Fund will continue to consider, the respective Fund's market price discount and the effect of the discount on the Surviving Fund and its shareholders. -31- Per Share Data for Credit Suisse Asset Management Strategic Global Income Fund, Inc. Common Stock Traded on the NYSE
Premium/(Discount) Market Price Net Asset Value as % of NAV -------------------- -------------------- -------------------- Period High Low High Low High Low - ------ ------- ------- ------- ------- ----- ----- 1998 First Quarter ........ $10.625 $10.062 $11.030 $10.640 (3.31)% (6.50)% Second Quarter ....... 10.875 9.806 10.990 10.740 (4.94) (7.02) Third Quarter ........ 10.125 7.875 10.720 9.240 (4.84) (12.81) Fourth Quarter ....... 8.875 7.806 9.420 9.080 (4.26) (11.89) 1999 First Quarter ........ 8.682 8.000 9.240 9.050 (5.67) (11.20) Second Quarter ....... 8.875 8.375 9.530 9.190 (5.41) (11.46) Third Quarter ........ 9.186 7.186 9.320 8.910 .22 (17.23) Fourth Quarter ....... 7.310 6.500 8.940 8.170 (15.05) (25.20) 2000 First Quarter ........ 7.375 6.558 8.430 8.290 (10.71) (18.67) Second Quarter ....... 7.310 6.806 8.160 7.830 (8.25) (14.70) Third Quarter ........ 7.434 7.125 7.970 7.700 (4.89) (9.25) Fourth Quarter ....... 7.310 6.434 7.700 6.950 (3.57) (13.45) 2001 First Quarter (through __/__/01) .....
-32- Per Share Data for Credit Suisse Asset Management Income Fund, Inc. Common Stock Traded on the NYSE
Premium/(Discount) Market Price Net Asset Value as % of NAV -------------------- -------------------- -------------------- Period High Low High Low High Low - ------ ------- ------- ------- ------- ----- ----- 1998 First Quarter ........ $8.875 $8.062 $8.530 $8.380 4.04% (2.32)% Second Quarter ....... 8.500 8.125 8.500 8.420 (0.03) (3.68) Third Quarter ........ 8.625 6.875 8.430 7.840 1.29 (5.74) Fourth Quarter ....... 8.000 7.062 7.860 7.630 2.95 (5.35) 1999 First Quarter ........ 7.875 7.250 7.800 7.610 0.16 (4.22) Second Quarter ....... 7.682 7.250 7.800 7.510 0.30 (3.85) Third Quarter ........ 7.875 6.186 7.630 7.300 4.17 (12.67) Fourth Quarter ....... 6.625 5.558 7.340 7.180 (8.87) (20.27) 2000 First Quarter ........ 6.625 5.750 7.280 7.040 (11.95) (20.58) Second Quarter ....... 6.558 5.750 6.960 6.660 (3.27) (16.49) Third Quarter ........ 7.000 6.250 6.660 6.350 8.53 (6.16) Fourth Quarter ....... 6.625 5.375 6.350 5.610 5.38 (4.36) 2001 First Quarter (through __/__/01) ...
Capitalization. The following table shows on an unaudited basis the capitalization of CGF and CIK as of December 31, 2000 and on a pro forma basis as of that same date giving effect to the Reorganization(1):
Pro Forma CGF CIK Adjustments Combined ----------- ------------ ----------- ------------ Net assets .................. $85,331,563 $197,817,004 $283,148,567 Net asset value per share (2) $ 7.12 $ 5.70 5.70 Shares outstanding (3) ...... 11,976,699 34,708,369 14,970,450 49,678,819
- ---------- (1) Assumes the Reorganization had been consummated on December 31, 2000, and is for information purposes only. No assurance can be given as to how many shares of CIK common stock shareholders of CGF will receive on the date the Reorganization takes place, and the foregoing should not be relied upon to reflect the number of shares of CIK common stock that actually will be received on or after such date. (2) Does not reflect estimated reorganization related expenses of $600,000, which will be allocated equally between CGF and CIK. (3) Assumes the issuance of 14,970,450 shares in exchange for the net assets of CGF. The number of shares issued was based on the net asset value of each Fund, on December 31, 2000. Dividends and Other Distributions. Each Fund pays dividends of substantially all its net investment income monthly and makes distributions at least annually of any net short-term capital gains and net long-term realized capital gains (the excess of net long-term capital gains over net short-term capital losses, including capital loss carryforwards). Dividends and distributions are recorded on the ex-dividend date. Income distributions and capital gain distributions are determined in accordance with U.S. Federal income tax regulations which may differ from generally accepted accounting principles. These differences are principally due to the timing of the recognition of defaulted bond interest and to differing book and tax treatment for foreign currency transactions. -33- Permanent book and tax differences relating to shareholder distributions may result in reclassifications to undistributed net investment income (loss), undistributed realized gain (loss) and paid in capital. If the Reorganization is approved by each Fund's shareholders, then as soon as practicable before the Effective Date, each Fund will pay its shareholders a cash distribution of all undistributed 2001 net investment income. It is expected that any undistributed realized net capital gains will be offset through the utilization of capital loss carryforwards prior to the Effective Date. Unrealized Capital Gains/Losses. As of December 31, 2000, CGF had approximately $16.9 million of unrealized capital losses, representing approximately 20% of its net assets. As of that same date, CIK had approximately $75.8 million of unrealized capital losses, representing approximately 38% of its net assets. As of December 31, 2000, CGF had approximately $6.9 million of capital loss carryforwards, while CIK had approximately $10.8 million of capital loss carryforwards. CGF will pay its shareholders a cash distribution of substantially all undistributed 2001 net investment income prior to the Effective Date. It is expected that any undistributed realized net capital gains will be offset through the utilization of capital loss carryforwards prior to the Effective Date. Portfolio Valuation. Investments of each Fund are stated at value in each Fund's financial statements. Market values for fixed-income securities are valued at the latest quoted bid price in the over-the-counter market. However, fixed-income securities may be valued on the basis of prices provided by a pricing service which are based primarily on institutional size trading in similar groups of securities. Other securities listed on an exchange are valued at the latest quoted sales prices on the day of valuation or, if there were no sale on such day, the last bid price quoted on such day. Quotations of foreign currency prices denominated in a foreign currency are converted to U.S. dollars at the current exchange rate on the valuation date. Securities purchased with remaining maturities of 60 days or less are valued at amortized cost, if it approximates market value. Securities for which market quotations are not readily available (including restricted investments which are subject to limitations as to their sale) are valued at fair value as determined in good faith by the board of directors. In determining net asset value, consideration is given to cost, operating and other financial data. For purposes of valuing assets in connection with the Reorganization, the assets of CGF will be valued pursuant to the principles and procedures consistently utilized by CIK, which principles and procedures are also utilized by CGF in valuing its own assets and determining its own liabilities. As a result, it is not expected that CIK's valuation procedures as applied to CGF's portfolio securities will result in any difference from the valuation that would have resulted from the application of CGF's valuation procedures to such securities. Portfolio Transactions. CSAM will select the brokers or dealers that will execute the purchases and sales of portfolio securities for the Funds. In connection with the selection of brokers and dealers, the primary objective is to seek to obtain the execution of each investment transaction at a price and commission which provides the most favorable total cost or proceeds reasonably obtainable under the circumstances. For a more detailed discussion of the Funds' brokerage allocation practices, see the SAI under "Portfolio Transactions." Dividend Reinvestment and Cash Purchase Plan. Each Fund operates a Dividend Reinvestment and Cash Purchase Plan, the InvestLink Program, or the "Program", sponsored and administered by Fleet National Bank, c/o EquiServe, L.P., pursuant to which Fund dividends and distributions, net of any applicable U.S. withholding tax, are reinvested in shares of the Fund. Fleet National Bank c/o EquiServe, L.P., serves as the Program Administrator for the shareholders in administering the Program. -34- An interested shareholder may join the Program at any time by submitting a completed Authorization Form to the Program Administrator. Such a form can be obtained by contacting the Administrator at 1-800-730-6001. If a participant selects the dividend reinvestment option, automatic investment of dividends generally will begin with the next dividend payable after the Program Administrator receives his enrollment form. Once in the Program, a person will remain a participant until he terminates his participation or sells all shares held in his Program account, or his account is terminated by the Program Administrator. A participant may change his investment options at any time by requesting a new enrollment form and returning it to the Program Administrator. A shareholder whose shares are held by a broker or nominee that does not provide a dividend reinvestment program may be required to have his shares registered in his own name to participate in the Program. The receipt of dividends and distributions in stock under the Program will not relieve participants of any income tax (including withholding tax) that may be payable on such dividends or distributions. If the Board of Directors of a Fund declares an income dividend or a capital gains distribution payable either in that Fund's common stock or in cash, as shareholders may have elected, nonparticipants in the Program will receive cash and participants in the Program who have opted for the dividend reinvestment option will receive shares of common stock of the Fund purchased on the open market by the Program Administrator. The number of shares of common stock to be purchased for a participant depends on the amount of his dividends, cash payments or bank account or payroll deductions, less applicable fees and commissions, and the purchase price of the shares. Such purchases will be made by participating brokers as agent for the participants using normal cash settlement practices. All shares of common stock purchased through the Program will be allocated to participants as of the settlement date, which is usually three Business Days from the purchase date. Participants in the Program also have the option of making additional cash payments, or bank account deductions, to the Program Administrator for the purchase of shares of common stock of the Fund, in any amount from $100 up to $100,000 annually. A participant will be assessed certain charges in connection with his participation in the Program. First-time investors will be subject to an initial service charge which will be deducted from their initial cash deposit. All optional cash deposit investments will be subject to a service charge. Sales processed through the Program will have a service fee deducted from the net proceeds, after brokerage commissions. In addition to these transaction charges, participants will be assessed per share processing fees which include brokerage commissions. Participants will not be charged any fee for reinvesting dividends. All correspondence concerning the Program should be directed to the Program Administrator at Fleet National Bank c/o EquiServe, L.P., InvestLink Program, P.O. Box 8040, Boston, MA 02266-8040. For a more complete description of the Plan, see "Dividend Reinvestment and Cash Purchase Plan" in the SAI. Corporate Governance Provisions. Both Funds are Maryland corporations and have similar charter and by-law provisions. Special Voting Provisions and Requirements. Certain provisions of the Funds' By-laws could have the effect of limiting the ability of other entities or persons to acquire control of the Fund, to cause it to engage in certain transactions or to modify its structure. Each Fund's By-laws contain provisions the effect of which is to prevent matters, including nominations of directors, from being considered at shareholders' meetings where the Fund has not received sufficient prior notice of the matters. Each Fund's By-laws provide, among other things, that: -35- o a majority of the outstanding capital stock of such Fund is required to request a special meeting of shareholders; o matters to be discussed and acted upon at special meetings of the shareholders must be specified in the call for the meeting; o certain advance notice requirements must be met in order for shareholders to submit proposals at meetings of the shareholders and for nominations by shareholders for election to the Board of Directors; and o the power to amend the Bylaws is reserved to the Board of Directors, except as otherwise required by the Investment Company Act. These provisions could have the effect of depriving shareholders of an opportunity to sell their shares at a premium over prevailing market prices by discouraging a third party from seeking to obtain control of either Fund in a tender offer or similar transaction. In the opinion of each Fund's Board of Directors, however, these provisions offer several possible advantages, including: o they may require persons seeking control of either Fund to negotiate with its management regarding the price to be paid for the shares required to obtain such control, o they promote continuity and stability, and o they enhance each Fund's ability to pursue long-term strategies that are consistent with its investment objectives. The full text of CIK's and CGF's Articles of Incorporation and Bylaws are on file with the SEC. The CIK charter and Bylaws, as may be amended from time to time, will govern the Surviving Fund after the Reorganization. Interest of Certain Persons. CSAM may be deemed to have an interest in the Plan and the Reorganization because it provides separate advisory services to CGF and CIK. CSAM receives compensation from CGF and CIK for services it provides pursuant to separate advisory agreements. The terms and provisions of these agreements and the new Investment Advisory Agreement to be entered into between the Surviving Fund and CSAM upon the consummation of the reorganization are described under "Proposal 2--Approval of New Investment Advisory Agreement with CSAM" and in the SAI. Future growth of assets of the Surviving Fund, if any, can be expected to increase the total amount of fees payable to CSAM. However, assuming Proposal 2 is approved, CIK's investment advisory fee will be based upon the lower of the average weekly stock price (market value) of its outstanding shares or its average weekly net assets, and, as a result, whenever CIK's shares trade at a discount, the investment advisory fee payable to CSAM by CIK would be reduced. For example, CIK's average market value was $210,920,089 and its average weekly net assets was $251,048,249 during 2000. If the new fee structure had been in place as of January 1, 2000, the investment advisory fee payable to CSAM for that year would have been $1,067,328 (instead of $1,148,844 under the existing arrangement), or .43% of net assets. For more information about the reduction in CSAM's aggregate advisory fees, see "Proposal 2--Approval of New Investment Advisory Agreement with CSAM." -36- Management of the Funds Directors and Principal Officers. The business and affairs of each Fund are managed under the direction of that Fund's Board of Directors, and the day to day operations are conducted through or under the direction of the officers of that Fund. All the Directors and Officers of CIK are also Directors and Officers of CGF. Directors and Executive Officers of CIK and CGF are as follows:
Shares Beneficially Name and Address Owned on _______, 2001(2) Position with the Fund - ----------------------------------- ------------------------ ------------------------------- CGF CIK James P. McCaughan (47)* ............... 0 0 Director and Chairman of the Credit Suisse Asset Management Board 466 Lexington Avenue, 16th Floor New York, New York 10017 William W. Priest (59)* ................ 500 500 Director Credit Suisse Asset Management 466 Lexington Avenue, 16th Floor New York, New York 10017 Prof. Enrique R. Arzac (59)(1) ......... Director Columbia University Graduate School of Business New York, New York 10027 Lawrence J. Fox (57)(1) ................ 13,737 11,664 Director 110 PNB Building Broad and Chestnut Streets Philadelphia, Pennsylvania 19107 James S. Pasman, Jr. (70)(1) ........... 1,433 1,000 Director 29 The Trillium Pittsburgh, Pennsylvania 15238 Richard J. Lindquist (40) .............. 1,333 1,000 President and Chief Investment Credit Suisse Asset Management Officer 466 Lexington Avenue New York, New York 10017 Michael A. Pignataro (41) .............. 1,000 1,000 Vice President and Chief Credit Suisse Asset Management Financial Officer and Secretary 466 Lexington Avenue New York, New York 10017
-37-
Shares Beneficially Name and Address Owned on _______, 2001(2) Position with the Fund - ----------------------------------- ------------------------ ------------------------------- CGF CIK Hal Liebes, Esq. (36) .................. 0 150 Senior Vice President Credit Suisse Asset Management 466 Lexington Avenue New York, New York 10017 Gregg Diliberto (45) ................... 0 0 Investment Officer of CGF Credit Suisse Asset Management 466 Lexington Avenue New York, New York 10017 Suzanne Moran (35) ..................... 0 0 Investment Officer Credit Suisse Asset Management 466 Lexington Avenue New York, New York 10017
- ---------- (1) Indicates Non-interested Director and member of audit committee. (2) Each Director and Officer listed has sole voting and investment power with respect to the shares shown. * Messrs. McCaughan and Priest are interested persons of CGF and CIK by virtue of their position as an officer of CSAM. Each Director and all the directors and executive officers, as a group, of each of CGF and CIK, as of _____, 2001 owned less than 1% of the outstanding shares of CGF and CIK, respectively. James P. McCaughan has been a Managing Director and the Chief Executive Officer of CSAM since April 2000. Prior to joining CSAM, he was President and Chief Operating Officer of Oppenheimer Capital from April 1998 to December 1999. He was President and Chief Executive Officer of UBS Asset Management (New York) from October 1996 to March 1998 and Functional Advisor, Institutional Asset Management of Union Bank of Switzerland from September 1994 to October 1996. He is a Director of five other CSAM-advised investment companies. William W. Priest, Jr., has been Chairman and Managing Director of CSAM from May 2000 to February 2001. Mr. Priest was Chief Executive Officer and Managing Director of CSAM from 1990 to 2000. He is a Director of fifty-three other CSAM-advised investment companies. Dr. Enrique R. Arzac was a Professor of Finance and Economics at the Graduate School of Business, Columbia University since 1971. Dr. Arzac is also a Director of six other CSAM-advised investment companies, and he is a Director of The Adams Express Company and Petroleum and Resources Corporation. Lawrence J. Fox has been a Managing Partner and Chairman of the Professional Responsibility Committee of the law firm of Drinker Biddle & Reath since January 1992. He has been a partner of Drinker Biddle & Reath since 1976. Mr. Fox is also a Director of one other CSAM-advised investment company. -38- James S. Pasman, Jr. was the President and Chief Operating Officer of National InterGroup, Inc. from April 1989 to March 1991. Mr. Pasman is also a Director of forty-seven other CSAM-advised investment companies and is a director of ADT, Ltd. and a trustee of BT Insurance Funds Trust. Richard J. Lindquist has been a Managing Director of CSAM and a Vice President of each Fund since April 1995. Michael A. Pignataro has been a Director of CSAM since January 2001. He was a Vice President of CSAM from December 1995 to December 2000. He was an Assistant Vice President and the Chief Administrative Officer for Investment Companies of CSAM from September 1989 to December 1995. Mr. Pignataro is also an executive officer of other CSAM-advised investment companies. Hal Liebes has been a Managing Director and General Counsel of CSAM since December 1999. He was Director and General Counsel of CSAM from March 1997 to December 1999. Mr. Liebes was Vice President and Counsel for Lehman Brothers, Inc. from June 1996 to March 1997, Vice President and Legal Counsel for CSAM from June 1995 to June 1996 and Chief Compliance Officer for CS First Boston Investment Management from March 1994 to June 1995. He is also an executive officer of other CSAM-advised investment companies. Gregg Diliberto has been a Managing Director of CSAM since May 1995. He was a Senior Vice President of CSAM from January 1992 to May 1995. Suzanne Moran has been a Director of CSAM since January 2001. Prior to that, she was a Vice President of CSAM from December 1996 to December 2000. She was Assistant Vice President and Fixed Income Trader of CSAM from May 1995 to December 1996 and Assistant Vice President and Portfolio Analyst at CS First Boston from August 1991 to April 1995. Each Fund pays each of its directors who is not a director, officer or employee of CSAM or any affiliate thereof an annual fee of $12,500 plus $1,000 for each meeting attended. In addition, each Fund reimburses those directors for travel and out-of-pocket expenses incurred in connection with meetings. The aggregate remuneration paid to directors by each Fund during the fiscal year ended December 31, 2000 was $49,500. The Articles of Incorporation and By-laws of each Fund provide that the Fund will indemnify directors and officers and may indemnify employees or agents of the Fund against liabilities and expenses incurred in connection with litigation in which they may be involved because of their positions with the Fund to the fullest extent permitted by law. In addition, each Fund's Articles of Incorporation provide that the Fund's directors and officers will not be liable to shareholders for money damages, except in limited instances. Each of the Independent Directors of the Funds is also party to an Indemnification Agreement with the Fund or Funds as to which he serves as a director providing for contractual rights of indemnity and advancement of expenses. However, nothing in the Articles of Incorporation, the By-laws or the Indemnification Agreements of either Fund protects or indemnifies a director, officer, employee or agent against any liability to which such person would otherwise be subject by reason of willful misfeasance, bad faith, gross negligence or reckless disregard of the duties involved in the conduct of such person's office. Insurance obtained by either Fund shall not protect or purport to protect officers or directors or the investment adviser of that Fund against any liability to the Fund or its shareholders to which they would otherwise be subject by reason of willful misfeasance, bad faith, gross negligence or reckless disregard of their obligations and duties. -39- Investment Manager. CSAM, located at 466 Lexington Avenue, 16th Floor, New York, New York 10017-3174, provides investment advisory services to both CGF and CIK under separate advisory agreements. CSAM is an indirect wholly-owned U.S. subsidiary of Credit Suisse Group. Credit Suisse Group is a global financial services company providing a comprehensive range of banking and insurance products. Active on every continent and in all major financial centers, Credit Suisse Group comprises five business units - Credit Suisse Asset Management (asset management), of which CSAM is a member; Credit Suisse First Boston (investment banking); Credit Suisse Private Banking (private banking); Credit Suisse (retail banking); and Winterthur (insurance). Credit Suisse Group has approximately $680 billion of global assets under management and employs approximately 62,000 people worldwide. The principal business address of Credit Suisse is Paradeplatz 8, CH 8070, Zurich, Switzerland. Credit Suisse Asset Management companies managed approximately $94 billion in the U.S. and $298 billion globally as of December 31, 2000. CSAM's sole member is CSAM Americas Holding Corp. located at 466 Lexington Avenue, New York, NY 10017, which is wholly-owned by Credit Suisse Asset Management Holding Corp., of the same address, which in turn is wholly-owned by Credit Suisse First Boston, Inc., located at 11 Madison Avenue, New York, NY 10010, which is indirectly wholly-owned by Credit Suisse Group. For information regarding a proposed new investment advisory agreement with CSAM, see "Proposal 2: Approval of New Investment Advisory Agreement." CSAM has sole investment discretion for each Fund's assets under the supervision of that Fund's Board of Directors and in accordance with each Fund's stated policies. CSAM will select investments for each Fund and will place purchase and sale orders on behalf of the Funds. For information about each Fund's investment advisory fees, including amounts paid for the fiscal year 2000, see "Synopsis--Fees and Expenses--The Strategic Global Income Fund" and "Synopsis--Fees and Expenses--The Income Fund." Executive Officers of CSAM The following chart sets forth information with respect to name, address and principal occupations of the executive officer(s) and managing member(s) of CSAM. (Unless otherwise noted, the person's position at CSAM constitutes his/her principal occupation.) Each person's address is 466 Lexington Avenue, New York, New York 10017. - -------------------------------------------------------------------------------- Name Position with CSAM and Principal Occupation - -------------------------------------------------------------------------------- James P. McCaughan Chief Executive Officer, Managing Director and Chairman of the Management Committee - -------------------------------------------------------------------------------- G. Moffett Cochran President, Managing Director and Member of the Management Committee - -------------------------------------------------------------------------------- Martin Jaffe Chief Financial Officer, Managing Director and Member of the Management Committee - -------------------------------------------------------------------------------- Laurence R. Smith Chief Investment Officer, Managing Director and Member of the Management Committee - -------------------------------------------------------------------------------- Elizabeth B. Dater Head of Emerging Growth Group, Managing Director and Member of the Management Committee - -------------------------------------------------------------------------------- Christopher F. Corapi Head of Equity Research, Managing Director and Member of the Management Committee - -------------------------------------------------------------------------------- Sheila Scott Managing Director and Member of the Management Committee - -------------------------------------------------------------------------------- -40- In addition, Suzanne Moran, the Funds' Investment Officer, and Michael A. Pignataro, the Funds' Vice President, Chief Financial Officer and Secretary, are also employees of CSAM. Portfolio Management. Richard J. Lindquist, who has been a Managing Director of CSAM since 1997, is primarily responsible for the management of each Fund's assets. Mr. Lindquist joined CSAM in May 1995 when CSAM succeeded CS First Boston Asset Management as the Fund's investment adviser, with whom he was previously employed, and became President and Chief Investment Officer of each Fund in November 1996. Mr. Lindquist has served each Fund in various positions since its inception. Gregg Diliberto, who has been a Managing Director of CSAM since May 1995, shares responsibility for the management of CGF's investments in emerging markets. Mr. Diliberto has been an Investment Officer of CGF since 1997. If the Reorganization is consummated, it is anticipated that Richard J. Lindquist and Gregg Diliberto will continue as portfolio managers of the Surviving Fund. For more information regarding Messrs. Lindquist and Diliberto, see "--Directors and Principal Officers." Administrator. The Fund employs Brown Brothers Harriman & Co., 40 Water Street, Boston, MA 02109, under a service agreement dated as of February 27, 1999, to provide administration and accounting services to each Fund. The services provided by Brown Brothers Harriman under the service agreement are subject to the supervision of the directors and officers of each Fund, and include day to day administration of certain matters such as maintenance of its records, preparation of financial reports and tax filings. Brown Brothers Harriman is a private bank organized as a partnership under the laws of the states of New York, Pennsylvania and Massachusetts. Brown Brothers Harriman provides corporate management and administrative services to investment companies that at December 31, 2000 had approximately $13 billion of net assets. Each Fund pays Brown Brothers Harriman a fee based on average net assets. For the fiscal year ended December 31, 2000, Brown Brothers Harriman earned $84,784 and $170,550 for administrative services rendered to CGF and CIK, respectively. Brown Brothers Harriman is also the custodian of each Fund. Estimated Expenses. CSAM and Brown Brothers Harriman are each obligated to pay expenses associated with providing the services contemplated by the agreements to which they are parties, including compensation of and office space for their respective officers and employees connected with investment and economic research, trading and investment management and administration of the Funds, as well as the fees of all directors of the Funds who are affiliated with those companies or any of their affiliates. The Funds pay all other expenses incurred in its operation including, among other things: o fees of legal counsel and independent accountants o costs of printing proxies, stock certificates and shareholder reports o charges of the custodians, any sub-custodians and the transfer and dividend-paying agent -41- o expenses in connection with the InvestLink-SM- Program o Securities and Exchange Commission fees o fees and expenses of unaffiliated directors o accounting and pricing costs o membership fees in trade associations o fidelity bond coverage for officers and employees o directors' and officers' errors and omissions insurance coverage o interest, brokerage costs and stock exchange fees o taxes, stock exchange listing fees and expenses o expenses of qualifying the shares for sale in various states o litigation and other extraordinary or non-recurring expenses Custodian. Brown Brothers Harriman & Co., 40 Water Street, Boston, MA 02109, is the custodian for the Funds' assets and also serves as the accounting agent of each Fund. Transfer Agent and Registrar. Fleet National Bank, P.O. Box 1865, Mailstop 45-02-62, Boston, Massachusetts 02105-1865 acts as the transfer agent and registrar of each Fund. Proxy Solicitor. Each Fund has retained Georgeson Shareholder Communications, Inc., a proxy solicitation firm, to assist the Funds in soliciting proxies from shareholders. Georgeson Shareholder Communications, Inc. will contact individual shareholders of record, beneficial owners and banks, brokers and other nominee shareholders. In return for its services Georgeson Shareholder Communications, Inc. is entitled to receive up to $20,000 per Fund plus per call charges and reimbursement for its reasonable expenses. Control Persons and Principal Holders of Securities. The following table shows certain information based on filings made with the SEC concerning persons who may be deemed beneficial owners of 5% or more of the shares of common stock of either Fund because they possessed or shared voting or investment power with respect to the shares of that Fund: Number of shares Percent of Fund Name and Address Beneficially Owned Shares - ---- -------------------------------------- ------------------ ------ CGF Ron Olin Investment Management Company 1,960,901 16.4%(1) One West Pack Square, Suite 777 Asheville, NC 28801 Ronald G. Olin 1,803,700 15.1%(2) One West Pack Square, Suite 777 Asheville, NC 28801 CIK None Reported _________ ________ - ---------- (1) Based on a Schedule 13-G filed with the SEC on January 10, 2001. -42- (2) Based on a Schedule 13-G filed with the SEC on December 8, 2000. It is not possible to calculate the ownership of the outstanding shares of common stock of the Surviving Fund by any of the persons listed above after consummation of the Reorganization because the Funds are unable to predict what the net asset value of either Fund will be on the Effective Date. Experts Each Fund has selected PricewaterhouseCoopers LLP, Two Commerce Square, Suite 1700, 2001 Market Street, Philadelphia, PA 19103, as its independent public accountants who will audit its financial statements. The following table shows the aggregate fees PricewaterhouseCoopers LLP billed to the Funds and to CSAM for its professional services rendered for the fiscal year ended December 31, 2000. ------------------------------------------------------------ CIK CGF CSAM --- --- ---- ------------------------------------------------------------ Audit Fees ------------------------------------------------------------ Financial Information Systems Design and Implementation Fees ------------------------------------------------------------ All Other Fees ------------------------------------------------------------ Required Vote As the Reorganization is expected to result in the issuance of a number of shares of CIK in excess of 20% of CIK's outstanding shares of common stock, the NYSE listing rules (but not Maryland law) require that the Reorganization be approved by the shareholders of CIK. The shareholder vote required by the NYSE rules is a majority of the votes cast by CIK shareholders, provided also that the total number of votes cast represents at least a majority of the outstanding shares of common stock of CIK. Under Maryland law and CGF's charter, a majority of the outstanding shares of CGF must approve Proposal 1. To facilitate compliance with Section 2-419 of the MGCL (which applies to transactions between corporations with common directors), any shares voted in favor of the Reorganization by the Directors of the Funds or CSAM will not be counted in determining whether the required vote has been obtained on Proposal 1. Subject to such approval, the Reorganization is currently scheduled to be consummated promptly after the meetings. The Board of Directors of each Fund recommends that the shareholders of each Fund vote in favor of this Proposal 1. Legal Proceedings There are currently no material legal proceedings to which the Funds are a party. Legal Opinions Certain legal matters in connection with the Reorganization will be passed upon for the Funds by Willkie Farr & Gallagher. Willkie Farr & Gallagher will rely as to certain matters of Maryland law on the opinion of Venable, Baetjer and Howard, LLP. -43- PROPOSAL 2 (CREDIT SUISSE ASSET MANAGEMENT INCOME FUND SHAREHOLDERS ONLY): APPROVAL OF NEW INVESTMENT ADVISORY AGREEMENT Background CSAM currently acts as CIK's investment adviser pursuant to an investment advisory agreement between CSAM and the Fund dated June 13, 1995, which was last approved by CIK's shareholders on June 13, 1995. See "Proposal 1 (Both Funds): Approval of the Agreement and Plan of Reorganization Pursuant to which CIK Will Acquire All the Assets and Liabilities of CGF--Synopsis--Fees and Expenses of CIK." On ___________, 2001, at an in-person meeting of the Board specifically called for this purpose, the Board of Directors of the Fund, including the Independent Directors, unanimously approved a new investment advisory agreement (the "New Investment Advisory Agreement") conditional upon approval of the Reorganization and recommended that it be approved by the shareholders of the Fund, to become effective upon the consummation of the Reorganization. The New Investment Advisory Agreement will be substantially the same as the current investment advisory agreement except that the investment advisory fee will be based upon a percentage of the lower of the average weekly stock price (market value) of the Fund's outstanding shares or its average weekly net assets. For the fiscal year ended December 31, 2000, CIK paid no brokerage commissions to affiliated brokers. See "Portfolio Transactions" in the SAI for more information. A description of the proposed New Investment Advisory Agreement is provided below under "--The New Investment Advisory Agreement." This description is only a summary and is qualified by reference to the form of investment advisory agreement attached hereto as Exhibit B, which is marked to show changes from the current investment advisory agreement for CIK. Board Considerations; Reasons for the New Investment Advisory Agreement At the __________, 2001 board meeting, CSAM proposed changing the basis upon which the fee is calculated. Changing the methodology by which the current investment advisory fees are calculated as described above (that is, based on the lower of the average weekly stock price (market value) or average weekly net assets) would reduce investment advisory fees whenever the Surviving Fund trades at a discount to net asset value, thereby lowering its overall expense ratio. In addition, the Board of Directors believes that calculating the investment advisory fee with reference to the stock price (market value) when the Fund's shares are trading at a discount will more closely align the interests of CSAM with the interests of the Fund's shareholders in enhancing the Fund's market value, recognizing that CSAM does not and cannot control the discount at which Fund shares trade. The Board of Directors also considered and evaluated the proposed New Investment Advisory Agreement and determined that, except for the new fee structure, the New Investment Advisory Agreement is not materially different from the current investment advisory agreement. CSAM has confirmed that the level and quality of the services provided to the Fund will not change if the New Investment Advisory Agreement is approved by the Fund's shareholders. -44- Information Concerning Credit Suisse Group and CSAM For information about the Fund's investment adviser, see "Proposal 1 (Both Funds): Approval of the Agreement and Plan of Reorganization pursuant to which CIK will Acquire all the Assets and Liabilities of CGF--Management of the Funds." Description of Current Investment Advisory Agreement Under the current investment advisory agreement, CSAM provides the Fund with ongoing investment advisory services. CSAM, subject to the general supervision of the Directors and in accordance with the investment objectives, policies and restrictions of the Fund, manages the investment operations of the Fund and the composition of the portfolio of securities and investments (including cash) belonging to the Fund. It is the responsibility of CSAM to make investment decisions for the Fund and to place purchase and sale orders for portfolio transactions. CSAM furnishes a continuous investment program for the Fund, maintains books and records with respect to its securities transactions, and pays all expenses involved in management of the Fund's investments. CSAM pays the salaries, fees and expenses of directors or officers of the Fund who are officers or employees of CSAM. The current agreement provides that CSAM shall not be liable to the Fund or any stockholder for anything done or omitted by it except acts or omissions involving willful misfeasance, bad faith, gross negligence or reckless disregard of duties imposed upon it pursuant to the current agreement, or for any losses that may be sustained in the purchase, holding or sale of securities. For a description of investment advisory fees paid by CIK, see "Proposal 1 (Both Funds): Approval of the Agreement and Plan of Reorganization Pursuant to which CIK Will Acquire All the Assets and Liabilities of CGF--Synopsis--Fees and Expenses--CIK." For the fiscal year ended December 31, 2000, CSAM earned $1,148,861 for advisory services rendered to CIK. The New Investment Advisory Agreement Shareholders are being asked to approve or disapprove the New Investment Advisory Agreement. The New Investment Advisory Agreement is substantially the same as the current investment advisory agreement except for modification of the basis upon which the fee is calculated, that is, the lower of stock price or net assets. The New Investment Advisory Agreement will be dated as of the date shareholder approval is granted. The agreement will be in effect for an initial two-year term, ending on the second anniversary of the date on which shareholder approval is granted. The agreement may continue thereafter from year to year only if specifically approved at least annually by either (i) the Board of Directors of the Fund or (ii) the "vote of a majority of the outstanding voting securities" of the Fund, and in either case, the vote of a majority of the Independent Directors, cast in person at a meeting called for such purpose. The implementation of the New Investment Advisory Agreement is conditional upon approval of the Reorganization. Differences Between the Current and the New Investment Advisory Agreement Under the current investment advisory agreements, CSAM is entitled to quarterly investment advisory fees computed at an annual rate of 0.50% of the Fund's average weekly net assets. Under the New Investment Advisory Agreement, CSAM will be entitled to receive quarterly investment advisory fees computed at an annual rate of 0.50% of the Fund's average weekly market value or net assets (whichever is lower). -45- The following table sets forth the investment advisory fee paid for the fiscal year ended December 31, 2000 under the current investment advisory agreement and the amount that would have been paid had the New Investment Advisory Agreement been in effect for CIK for the fiscal year ended December 31, 2000 taking into consideration the new fee structure. Also shown is the difference between the two amounts in dollars and as a percentage of the fee paid under the existing agreement. Fee Paid to CSAM Under Fee Payable Under New Current Agreement Agreement Reduction in Fee ---------------------- --------------------- ---------------- $1,148,861 $1,067,328 $81,533 .0709% Required Shareholder Vote Approval of the New Investment Advisory Agreement requires the affirmative vote of a "majority of the outstanding voting securities" of the Fund as defined under "General". IN THE JUDGMENT OF THE BOARD OF DIRECTORS OF THE FUND, THE NEW INVESTMENT ADVISORY AGREEMENT SERVES THE BEST INTERESTS OF THE SURVIVING FUND AND ITS SHAREHOLDERS, AND THE BOARD OF DIRECTORS RECOMMENDS THAT SHAREHOLDERS VOTE "FOR" PROPOSAL 2. PROPOSAL 3 (CREDIT SUISSE ASSET MANAGEMENT INCOME FUND SHAREHOLDERS ONLY): ELECTION OF DIRECTORS Background At the Meeting, five (5) Directors will be elected to hold office until the next annual meeting of shareholders following their election and until their respective successors are elected and qualified. It is the intention of the person named in the accompanying Proxy to vote for the election of Enrique R. Arzac, Lawrence J. Fox, James S. Pasman, Jr., James P. McCaughan and William W. Priest. All of the nominees are currently members of the Board of Directors. Messrs. Arzac, Fox, Pasman and Priest were re-elected as Directors of CIK at the 2000 annual shareholders' meeting. Mr. McCaughan was appointed a Director and the Chairman of the Board at a meeting of the Board held on February 5, 2001. Each of the nominees has consented to be named in this Proxy Statement and to serve as a Director if elected. The Board of Directors has no reason to believe that any of the nominees named above will become unavailable for election as a Director, but if that should occur before the Meeting, Proxies will be voted for such persons as the Board may recommend. If the Reorganization is consummated, the Directors of CIK will be the Directors of the Surviving Fund. For information about the Directors of CIK, each of whom has been nominated for re-election to the Board of Directors, see "Proposal 1(Both Funds): Approval of the Agreement and Plan of Reorganization pursuant to which CIK Will Acquire All the Assets and Liabilities of CGF--Management of the Fund--Directors and Principal Officers." The Fund pays annual compensation of $12,500, plus $1,000 for attendance per meeting of the Board of Directors or Committees thereof, plus certain out-of-pocket expenses, to each Director that is not affiliated with CSAM, its investment adviser (three Directors are not affiliated with CSAM). Each such Director is also a director of one or more investment companies advised by CSAM, and in that capacity receives annual and per-meeting fees, plus certain out-of-pocket expenses, for services as a -46- director of such Fund. The total remuneration paid or accrued by CIK during the fiscal year ended December 31, 2000 to all such unaffiliated directors was $43,419. The following table shows certain compensation information for the fiscal year ended December 31, 2000 for each Director of CGF and CIK who is not affiliated with CSAM. The Fund has no bonus, profit sharing, pension or retirement plans.
Total Number of Boards of Pension or CSAM-Advised Aggregate Retirement Benefits Estimated Annual Total Compensation from Investment Compensation from Accrued as Part of Benefits upon Funds and Fund Complex Companies Served Name of Director Funds Fund Expenses Retirement Paid to Directors (1) - -------------------- ----------------- ------------------- ---------------- ----------------------- ----------------- Dr. Enrique R. Arzac ... CIK: $ 16,500 0 0 $82,500 8 CGF: $ 16,500 Lawrence J. Fox ........ CIK: $ 16,500 0 0 $41,500 3 CGF: $ 16,500 James. S. Pasman, Jr.... CIK: $ 16,500 0 0 $115,250 49 CGF: $ 16,500
- ---------- (1) Includes CGF and CIK The Board of Directors has an Audit Committee. Pursuant to the Audit Committee Charter adopted by the CIK's Board, a copy of which is attached to this Joint Proxy Statement/Prospectus as Appendix B, the Audit Committee is responsible for conferring with CIK's independent public accountants, reviewing annual financial statements and recommending the selection of CIK's independent public accountants. The Audit Committee advises the full Board with respect to accounting, auditing and financial matters affecting CIK. The Audit Committee has met with Fund management to discuss, among other things, CIK's audited financial statements for the year ended December 31, 2000. The Audit Committee has also met with CIK's independent public accountants, PricewaterhouseCoopers LLP ("PwC") and discussed with them certain matters required under SAS 61 including, but not limited to, the scope of CIK's audit, CIK's financial statements and CIK's accounting controls. The Audit Committee has received the written disclosures and the letter from PwC required by Independence Standards Board Standard No. 1. The Audit Committee has discussed with PwC their independence and has considered whether the provision of services by PwC to the Funds and to CSAM, as more fully described under "Proposal 1 (Both Funds): Approval of the Agreement and Plan of Reorganization pursuant to which CIK will Acquire all the Assets and Liabilities of CGF - Experts," was compatible with maintaining PwC's independence. Based upon these reviews and discussions, the Audit Committee recommended to the Board that CIK's audited financial statements be included in CIK's 2000 Annual Report to Shareholders for the year ended December 31, 2000 and be mailed to Shareholders and filed with the Securities and Exchange commission. Messrs. Arzac, Fox and Pasman constitute CIK's Audit Committee, which is composed of directors who are not interested persons of CIK as defined by the 1940 Act and who are independent as defined by the listing standards of the New York Stock Exchange. There were two Audit Committee meetings held during the fiscal year ended December 31, 2000. All directors were present at both meetings. There is also a Valuation Committee composed of Messrs. Priest, Arzac and Pasman which reviews prices of illiquid or restricted securities. Messrs. Arzac, Fox and Pasman constitute CIK's Nominating Committee, which is composed of directors who are not interested persons of CIK. The Nominating Committee did not meet during the fiscal year ended December 31, 2000. The Nominating -47- Committee selects and nominates new Independent Directors. The Nominating Committee will consider nominees recommended by shareholders should a vacancy arise. Recommendations should be submitted to the Nominating Committee in care of the Secretary of CIK. CIK does not have a compensation committee. During 2000, there were four meetings of the Board and two meetings of the Audit Committee. Each Director attended seventy-five percent or more of the aggregate number of meetings of the Board and committees on which he served held during the period for which he was a Director. Mr. McCaughan is the Chairman of the Board of CIK and has served in such position since February 5, 2001, Mr. Lindquist has been President of CIK since February 10, 1997 and Chief Investment Officer of CIK since November 21, 1996, having previously served as Vice President of CIK since CIK's inception. Ms. Moran and Mr. Diliberto have each been an Investment Officer of CIK since August 15, 1996 and May 12, 1997, respectively. Mr. Liebes is Senior Vice President of CIK and was appointed to such position on August 11, 1997, having previously been CIK's Secretary until May 16, 1996. Mr. Pignataro has been Chief Financial Officer and Vice President of CIK since July 26, 1999 and has been Secretary of CIK since May 16, 1997, having previously served as Assistant Vice President and Assistant Secretary of CIK since April 18, 1995. Each officer of CIK will hold office until the Meeting and until his successor has been elected. For more biographical information about the executive officers of CIK, see "Proposal 1(Both Funds): Approval of the Agreement and Plan of Reorganization pursuant to which CIK Will Acquire All the Assets and Liabilities of CGF--Management of the Fund--Directors and Principal Officers." By virtue of the responsibilities assumed by its investment adviser, CIK itself requires no employees other than its officers, and none of its officers devotes full-time responsibilities to the affairs of CIK. All officers are employees of and are compensated by CSAM and do not receive any compensation from CIK. Section 16(a) Beneficial Ownership Reporting Compliance Section 16(a) of the Securities Exchange Act of 1934 and Section 30(f) of the Investment Company 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 NYSE and the 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 December 31, 2000, all filing requirements applicable to such persons were complied with. Required Shareholder Vote Approval of the election of each nominee as Director of the Fund requires the affirmative vote of a plurality of the votes cast on the matter at the annual meeting of the Fund in person or by proxy. THE BOARD OF DIRECTORS, INCLUDING THE "NON-INTERESTED" DIRECTORS, RECOMMENDS THAT THE SHAREHOLDERS VOTE "FOR" THE RE-ELECTION OF MESSRS. ARZAC, FOX, PASMAN, PRIEST AND MCCAUGHAN FOR DIRECTOR. ADDITIONAL INFORMATION Further information concerning these securities and their issuer may be found in the Registration Statement of which this prospectus constitutes a part on file with the Securities and Exchange Commission. The Commission maintains a World Wide Web site on the Internet at http://www.sec.gov. -48- that contains the prospectus, material incorporated by reference and other information regarding registrants, such as the Funds, that file electronically with the Commission. The Registration Statement may also be inspected without charge at the Commission's office in Washington, D.C., and copies of all or any part thereof may be obtained from such office after payment of the fees prescribed by the Commission. The Funds are subject to the informational requirements of the Securities Exchange Act of 1934 and the 1940 Act, and in accordance therewith files reports and other information with the Commission. Such reports and other information can be inspected and copied at the public reference facilities maintained by the Commission at 450 Fifth Street, NW, Washington, D.C. 20549 and the Commission's regional offices at Seven World Trade Center, New York, New York 10048. Copies of such materials can be obtained from the Public Reference Section of the Commission at 450 Fifth Street, NW, Washington, D.C. 20549 at prescribed rates. Such reports and other information concerning the Funds also may be inspected at the offices of the NYSE and are available on the Commission's World Wide Web site on the Internet at http://www.sec.gov. Shareholder Proposal (CGF). CGF has received notice that a shareholder, Ralph Bradshaw intends to solicit proxies in favor of electing himself, Gary Bentz, Andrew Strauss, Glenn Wilcox and [name of fifth nominee to be inserted upon receipt], as Directors at the 2001 annual shareholders' meeting of CGF. If Proposal 1 is approved at the special meeting and the Reorganization is consummated, that proposed solicitation will be rendered moot, as CGF will be dissolved as part of the Reorganization. If Proposal 1 is rejected, the Board of Directors of CGF intends to oppose Mr. Bradshaw and his nominees. Shareholder Proposals (CIK). Notice is hereby given that for a shareholder proposal to be considered for inclusion in CIK's proxy material relating to its 2002 annual meeting of shareholders, the shareholder proposal must be received by CIK no later than ___________, 2002. A shareholder proposal submitted for inclusion in CIK's proxy statement, including any accompanying supporting statement, may not exceed 500 words. A shareholder desiring to submit a proposal for inclusion in CIK's proxy statement 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 for inclusion in CIK's proxy statement is referred to Rule 14a-8 promulgated under the 1934 Act. The timely submission of a proposal does not guarantee its inclusion in CIK's proxy materials. Pursuant to the By-laws of CIK, 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 CIK. To be timely, any such notice must be delivered to or mailed and received at Credit Suisse Asset Management Income Fund, Inc. c/o Credit Suisse Asset Management, LLC, 466 Lexington Avenue, New York, NY 10017 not later than ____________ , 2002; provided, however, that in the event that the date of the 2002 annual meeting is advanced or delayed by more than 30 days from May 1, 2002, the first anniversary of the 2001 annual meeting, notice by such 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 or public announcement of the date of the 2002 annual meeting is given or made. -49- Any notice by a shareholder to CIK 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 CIK's books, of the shareholder proposing such business, (iii) the class and number of Shares of the capital stock of CIK which are beneficially owned by the shareholder, (iv) a representation that the shareholder is a holder of record of shares of CIK entitled to vote at such meeting and intends to appear in person or by proxy at the meeting to present such business, (v) whether the shareholder intends or is part of a group which intends to solicit proxies from other shareholders in support of such business, and (vi) any material interest of the shareholder in such business. CIK may exercise discretionary voting authority with respect to any shareholder proposals that are not submitted in accordance with Rule 14a-8 under the 1934 Act and which are validly submitted after the advance notice deadline for submission of proposals pursuant to CIK's By-laws indicated above. Even if timely notice is received, CIK may exercise discretionary voting authority in certain other circumstances as described under Rule 14a-4(c) under the 1934 Act which governs the CIK's use of discretionary proxy voting authority. Discretionary voting authority is the ability to vote proxies that shareholders have executed and returned to CIK on matters not specifically reflected on the form of proxy. Other Matters to Come Before the Meeting. The Board of Directors of each Fund is not aware of any matters that will be presented for action at the Meeting other than the matters set forth herein. Should any other matters requiring a vote of shareholders arise, the proxy in the accompanying form will confer upon the person or persons entitled to vote the shares represented by such proxy the discretionary authority to vote the shares as to any such other matters in their discretion in the interest of the respective Fund. PLEASE COMPLETE, SIGN AND RETURN THE ENCLOSED PROXY CARD(S) PROMPTLY. NO POSTAGE IS REQUIRED IF MAILED IN THE UNITED STATES. By order of the Boards of Directors of Credit Suisse Asset Management Strategic Global Income Fund, Inc and Credit Suisse Asset Management Income Fund, Inc. Michael A. Pignataro Chief Financial Officer, Vice President and Secretary, Credit Suisse Asset Management Strategic Global Income Fund, Inc. Michael A. Pignataro Chief Financial Officer, Vice President and Secretary, Credit Suisse Asset Management Income Fund, Inc. -50- EXHIBIT A FORM OF AGREEMENT AND PLAN OF REORGANIZATION AGREEMENT AND PLAN OF REORGANIZATION BETWEEN CREDIT SUISSE ASSET MANAGEMENT STRATEGIC GLOBAL INCOME FUND, INC. AND CREDIT SUISSE ASSET MANAGEMENT INCOME FUND, INC. DATED AS OF ______, 2001 TABLE OF CONTENTS Page 1. DEFINITIONS..........................................................A-1 2. BASIC TRANSACTION....................................................A-1 2.1 The Reorganization.................................................A-1 2.2 Transferred Assets.................................................A-1 2.3 Transferred Liabilities............................................A-2 2.4 Dividend...........................................................A-2 2.5 Articles of Transfer...............................................A-2 2.6 Liquidation........................................................A-3 3. VALUATION............................................................A-3 3.1 Transferred Assets.................................................A-3 3.2 CIK Shares.........................................................A-3 3.3 Administrator......................................................A-3 4. CLOSING AND EFFECTIVE DATE...........................................A-3 4.1 Effective Date.....................................................A-3 4.2 Deliveries at Closing..............................................A-3 5. REPRESENTATIONS AND WARRANTIES OF CREDIT SUISSE ASSET MANAGEMENT STRATEGIC GLOBAL INCOME FUND, INC.........................A-4 5.1 Organization.......................................................A-4 5.2 Registrations and Qualifications...................................A-4 5.3 Regulatory Consents and Approvals..................................A-4 5.4 Noncontravention...................................................A-4 5.5 Financial Statements...............................................A-5 5.6 Title to Assets....................................................A-5 5.7 Annual Report......................................................A-5 5.8 Qualification, Corporate Power, Authorization of Transaction.......A-5 5.9 Legal Compliance...................................................A-5 5.10 Tax Filings........................................................A-5 5.11 Undisclosed Liabilities............................................A-5 5.12 Tax Filings........................................................A-6 5.13 Qualification Under Subchapter M...................................A-6 5.14 Form N-14..........................................................A-6 5.15 Capitalization.....................................................A-6 5.16 Books and Records..................................................A-7 5.17 CIK Shares.........................................................A-7 6. REPRESENTATIONS AND WARRANTIES OF CREDIT SUISSE ASSET MANAGEMENT INCOME FUND, INC..........................................A-7 6.1 Organization.......................................................A-7 6.2 Registrations and Qualifications...................................A-7 6.3 Regulatory Consents and Approvals..................................A-7 6.4 Noncontravention...................................................A-7 6.5 Financial Statements...............................................A-7 6.6 Title to Assets....................................................A-8 6.7 Annual Report......................................................A-8 6.8 Qualification, Corporate Power, Authorization of Transaction.......A-8 6.9 Legal Compliance...................................................A-8 6.10 Material Contracts.................................................A-8 6.11 Undisclosed Liabilities............................................A-8 6.12 Tax Filings........................................................A-8 6.13 Qualification Under Subchapter M...................................A-8 6.14 Form N-14..........................................................A-9 6.15 Capitalization.....................................................A-9 6.16 Issuance of Stock..................................................A-9 6.17 Books and Records..................................................A-9 7. COVENANTS OF THE PARTIES.............................................A-10 7.1 Shareholders' Meetings.............................................A-10 7.2 Operations in the Normal Course....................................A-10 7.3 Articles of Transfer...............................................A-10 7.4 Regulatory Filings.................................................A-10 7.5 Preservation of Assets.............................................A-10 7.6 Tax Matters........................................................A-10 7.7 Shareholder List...................................................A-10 7.8 Delisting, Termination of Registration as an Investment Company....A-11 8. CONDITIONS PRECEDENT TO THE OBLIGATIONS OF CREDIT SUISSE ASSET MANAGEMENT STRATEGIC GLOBAL INCOME FUND, INC.........................A-11 8.1 Approval of Reorganization.........................................A-11 8.2 Certificates and Statements by Credit Suisse Asset Management Strategic Global Income Fund, Inc..................................A-11 8.3 Absence of Litigation..............................................A-12 8.4 Legal Opinions.....................................................A-12 8.5 Auditor's Consent and Certification................................A-14 8.6 Liabilities........................................................A-14 8.7 Effectiveness of Registration Statement............................A-14 8.8 Regulatory Filings.................................................A-14 8.9 Administrative Rulings, Proceedings................................A-14 8.10 Satisfaction of Credit Suisse Asset Management Income Fund, Inc....A-14 8.11 Dividends..........................................................A-14 8.12 Custodian's Certificate............................................A-15 8.13 Books and Records..................................................A-15 9. CONDITIONS PRECEDENT TO THE OBLIGATIONS OF CREDIT SUISSE ASSET MANAGEMENT STRATEGIC GLOBAL INCOME FUND, INC.........................A-15 9.1 Approval of Reorganization.........................................A-15 9.2 Certificates and Statements by Credit Suisse Asset Management Income Fund, Inc...................................................A-15 9.3 Absence of Litigation..............................................A-16 9.4 Legal Opinions.....................................................A-16 9.5 Auditor's Consent and Certification................................A-17 9.6 Effectiveness of Registration Statement............................A-17 9.7 Regulatory Filings.................................................A-17 9.8 Satisfaction of Credit Suisse Asset Management Strategic Global Income Fund, Inc............................................A-18 10. PAYMENT OF EXPENSES..................................................A-18 10.1 Allocation.........................................................A-18 11. COOPERATION FOLLOWING EFFECTIVE DATE.................................A-18 12. INDEMNIFICATION......................................................A-18 12.1 Credit Suisse Asset Management Strategic Global Income Fund, Inc...A-18 12.2 Credit Suisse Asset Management Income Fund, Inc....................A-18 13. TERMINATION, POSTPONEMENT AND WAIVERS................................A-19 13.1 Termination........................................................A-19 13.2 Waiver.............................................................A-19 13.3 Expiration of Representations and Warranties.......................A-19 14. MISCELLANEOUS........................................................A-20 14.1 Transfer Restriction...............................................A-20 14.2 Material Provisions................................................A-20 14.3 Notices............................................................A-20 14.4 Amendments.........................................................A-21 14.5 Headings...........................................................A-21 14.6 Counterparts.......................................................A-21 14.7 Enforceability.....................................................A-21 14.8 Successors and Assigns.............................................A-21 14.9 Governing Law......................................................A-22 THIS AGREEMENT AND PLAN OF REORGANIZATION (the "Agreement") is made as of this __ day of ______, 2001, between Credit Suisse Asset Management Strategic Global Income Fund, Inc. (the "Target Fund" or "CGF"), a Maryland corporation and a registered investment company under the Investment Company Act of 1940, as amended (the "1940 Act"), and Credit Suisse Asset Management Income Fund, Inc. (the "Acquiring Fund" or "CIK" and, together with CGF, the "Parties"), a Maryland corporation and a registered investment company under the 1940 Act. This agreement contemplates a tax-free transaction which qualifies for federal income tax purposes as a reorganization within the meaning of Section 368(a)(1) of the Internal Revenue Code of 1986, as amended (the "Code"). The reorganization will consist of the transfer of all of the assets of CGF in exchange for shares of common stock of CIK ("CIK Shares") and cash for fractional CIK Shares, the assumption by CIK of all the liabilities of CGF, and the distribution of CIK Shares to the shareholders of CGF in liquidation of CGF, all upon the terms and conditions set forth in this Agreement. WHEREAS, the Board of Directors of CGF has determined that the exchange of substantially all of the assets of CGF for CIK shares and the assumption of all the liabilities of CGF by CIK is in the best interests of the CGF shareholders and the interests of the existing shareholders of CGF would not be diluted as a result of this transaction; and WHEREAS, the Board of Directors of CIK has determined that the exchange of substantially all of the assets of CGF for CIK shares and the assumption of CGF's liabilities by CIK is in the best interests of the CIK's shareholders and that the interests of the existing shareholders of CIK would not be diluted as a result of this transaction. NOW, THEREFORE, in consideration of the covenants and agreements hereinafter set forth, the Parties hereto agree as follows: 1. DEFINITIONS Certain capitalized terms used in this Agreement are specifically defined herein. 2. BASIC TRANSACTION 2.1 The Reorganization. Subject to the terms and conditions herein set forth and on the basis of the representations and warranties contained herein, CGF agrees to transfer its assets as set forth in paragraph 2.2 to CIK, and CIK agrees in exchange therefor: (i) to deliver to CGF the number of all CIK Shares determined by dividing the value of CGF's net assets, computed in the manner and as of the time and date set forth in paragraph 3.1, by the net asset value per share of one CIK Share computed in the manner and as of the time and date set forth in paragraph 3.2 and cash for fractional shares of CIK as set forth in paragraph 3.2; and (ii) to assume all of the liabilities of CGF. Such transaction shall take place at the closing provided for in paragraph 4.1 (the "Closing"). 2.2 Transferred Assets. (a) The assets of CGF to be acquired by CIK shall consist of all property including, without limitation, all cash, securities and dividend or interest receivables that are owned by CGF and any deferred or prepaid expenses shown as an asset on the books of CGF on the Effective Date provided in paragraph 4.1 (the "Effective Date"). (b) CGF has provided CIK with a list of all of CGF's assets as of the date of execution of this Agreement and CIK has confirmed that all such assets are of the type in which CIK is permitted to invest A-1 and to hold. CGF reserves the right to sell any of these securities but will not, without the prior approval of CIK, acquire any additional securities other than securities of the type in which CIK is permitted to invest. CIK, will, within a reasonable time prior to the Effective Date, furnish CGF with a list of its assets. In the event that CGF holds any investments which CIK identifies as a type which it may not hold, and CIK so requests, CGF will dispose of such securities prior to the Effective Date. In addition, if it is determined that the portfolios of CGF and CIK, when aggregated, would contain investments exceeding certain percentage limitations imposed upon CIK with respect to such investments, CGF, if requested by CIK, will dispose of and/or reinvest a sufficient amount of such investments as may be necessary to avoid violating such limitations as of the Effective Date. 2.3 Transferred Liabilities. (a) The liabilities assumed by CIK shall include all of the CGF's liabilities, debts, obligations, and duties of whatever kind or nature, whether absolute, accrued, contingent, or otherwise, whether or not arising in the ordinary course of business, whether or not determinable at the Effective Date, and whether or not specifically referred to in this Agreement. (b) CGF will endeavor to discharge all of its known liabilities and obligations prior to the Effective Date, other than those liabilities and obligations which would otherwise be discharged at a later date in the ordinary course of business. 2.4 Dividend. As soon as practicable prior to the Effective Date, CGF will declare and pay to its shareholders of record one or more dividends and/or distributions so that it will have distributed substantially all of its investment company taxable income (computed without regard to any deduction for dividends paid) and realized net capital gain, if any, for the current taxable year through the Effective Date. 2.5 Articles of Transfer. On the Effective Date (the "Effective Time"), pursuant to articles of transfer (the "Articles of Transfer") accepted for record by the State Department of Assessements and Taxation of Maryland (the "Department"), CGF shall assign, transfer, deliver and convey all of its assets to CIK, subject to all of its liabilities. CIK shall then accept the assets and assume the liabilities such that at and after the Effective Time (i) the assets at or after the Effective Time shall become and be the assets of CIK , and (ii) the liabilities at the Effective Time shall attach to CIK, enforceable against CIK to the same extent as if initially incurred by CIK. From and after the Effective Time, all the assets of CGF shall transfer to, vest in, and devolve on CIK without further act or deed, and CIK shall be liable for all the debts and obligations of CGF, all as provided under Maryland law. 2.6 Liquidation. As soon on or after the Effective Date as is conveniently practicable (the "Liquidation Date"), CGF will liquidate and distribute pro rata to its shareholders of record determined as of the Effective Time (the "CGF Shareholders") the CIK Shares and cash it receives pursuant to paragraph 2.1. Such liquidation and distribution will be accomplished by (i) the transfer of CIK Shares then credited to the account of CGF on the books of CIK to open accounts on the share records of CIK in the name of the CGF shareholders representing the respective pro rata number of CIK Shares due such shareholders and (ii) the payment of cash for fractional CIK shares in accordance with paragraph 3.2(b). All issued and outstanding shares of CGF will simultaneously be canceled on the books of CGF, although share certificates representing interests in CGF, if any, will represent a number of CIK Shares after the Effective Date as determined in accordance with paragraph 3.2 until replaced in accordance with paragraph 7.11. Ownership of CIK Shares will be shown on the books of CIK's transfer agent. 2.7 Dissolution. CGF shall thereafter dissolve in accordance with Maryland law. A-2 3. VALUATION 3.1 Transferred Assets. The value of CGF's assets to be acquired hereunder shall be the value of such assets computed as of the close of regular trading on the New York Stock Exchange, Inc. (the "NYSE") on the business day preceding the Effective Date (such time and date being hereinafter called the "Valuation Date"), using the valuation procedures set forth in the Registration Statement consistently utilized by CIK, which principles and procedures are substantially similar to those employed by CGF when valuing its own assets and determining its own liabilities. Such valuation and determination shall be the responsibility of CIK, shall be made in cooperation with CGF and shall be confirmed in writing by CIK to CGF. 3.2 CIK Shares. (a) The number of CIK Shares to be issued in exchange for the corresponding net assets of CGF shall be determined by dividing the value of the net assets of CGF determined using the valuation procedures referred to in paragraph 3.1 by the net asset value per Share of CIK. The net asset value per share of CIK Shares shall be determined in accordance with the valuation procedures set forth in the Registration Statement and consistently utilized by CIK, and CIK shall certify the computations involved. (b) CGF shareholders will not receive any fractional shares of CIK as part of the CGF distribution. In lieu thereof, CGF will receive from CIK for distribution to its shareholders cash in an amount equal to the aggregate net asset value of the fractional shares otherwise distributable to the CGF shareholders, and the total number of CIK shares otherwise issuable to CGF will be reduced by that number of CIK shares having an aggregate net asset value equal to the cash so paid to CGF. 3.3 Administrator. All computations of value shall be made on behalf of CIK by Brown Brothers Harriman & Co., the administrator and accounting agent to each Fund, in accordance with the regular practice of CGF and CIK, respectively. No formula will be used to adjust the net asset value so determined of either of the Parties to take into account differences in realized and unrealized gains and losses. 4. CLOSING AND EFFECTIVE DATE 4.1 Effective Date. The Effective Date for the Reorganization shall be _________, 2001, or such other date as the parties to the Reorganization may agree to in writing. All acts taking place at the Closing shall be deemed to take place simultaneously on the Effective Date unless otherwise provided. The Closing shall be held as of 9:00 a.m., at the offices of Willkie Farr & Gallagher, 787 Seventh Avenue, New York, New York, or at such other time and/or place as the parties may agree. 4.2 Deliveries at Closing. (a) At the Closing, (i) CGF will deliver to CIK the various certificates and documents referred to in Article 7 below, (ii) CIK will deliver to CGF the various certificates and documents referred to in Article 8 below, and (iii) CGF and CIK will file jointly with the State Department of Assessments and Taxation of Maryland (the "Department") the Articles of Transfer and make all other filings or recordings required by Maryland law in connection with the Reorganization. The custodian for CIK (the "Custodian") shall deliver at the Closing a certificate of an authorized officer stating that: (a) CGF's portfolio securities, cash and any other assets have been delivered in proper form to CIK on the Effective Date and (b) all necessary taxes, including all applicable federal and state stock transfer stamps, if any, A-3 have been paid, or provision for payment has been made, in conjunction with the delivery of portfolio securities. (b) CGF shall deliver at the Closing a list of the names and addresses of its shareholders and the number of outstanding Shares owned by each such shareholder immediately prior to the Closing certified by CGF's transfer agent or President to the best of their knowledge and belief or provide evidence that such information has been provided to CGF's transfer agent. CIK shall issue and deliver a confirmation evidencing the CIK Shares to be credited to CGF's account on the Effective Date to the Secretary of CGF or provide evidence satisfactory to CGF that the CIK Shares have been credited to the account of CGF on the books of CIK. At the Closing, each party shall deliver to the relevant other parties such bills of sale, checks, assignments, share certificates, if any, receipts or other documents as such other party or its counsel may reasonably request. 4.3 Closing on Business Day. In the event that on the Valuation Date (a) the NYSE or another primary trading market for portfolio securities of CIK or CGF shall be closed to trading or trading thereon shall be restricted or (b) trading or the reporting of trading on the NYSE or elsewhere shall be disrupted so that accurate appraisal of the value of the net assets of CIK or CGF is impracticable, the applicable Effective Date shall be postponed until the first business day after the day when trading shall have been fully resumed and reporting shall have been restored. 5. REPRESENTATIONS AND WARRANTIES OF CREDIT SUISSE ASSET MANAGEMENT STRATEGIC GLOBAL INCOME FUND, INC. CGF represents and warrants to CIK that the statements contained in this Article 5 are correct and complete in all material respects as of the execution of this Agreement on the date hereof. CGF represents and warrants to, and agrees with, CIK that: 5.1 Organization. CGF is a corporation duly organized and validly existing under the laws of the State of Maryland and is in good standing with the Department, and has the corporate power to own all of its assets and to carry on its business as it is now being conducted and to carry out this Agreement. 5.2 Registrations and Qualifications. CGF is duly registered under the 1940 Act as a closed-end, diversified management investment company (File No. 811-05458), and such registration has not been revoked or rescinded and is in full force and effect. CGF has elected and qualified for the special tax treatment afforded regulated investment companies ("RICs") under Sections 851-855 of the Code at all times since its inception. CGF is qualified as a foreign corporation in every jurisdiction where required, except to the extent that failure to so qualify would not have a material adverse effect on CGF. 5.3 Regulatory Consents and Approvals. No consent, approval, authorization or order of any court or governmental authority is required for the consummation by CGF of the transactions contemplated herein, except (i) such as have been obtained or applied for under the Securities Act of 1933, as amended (the "1933 Act"), the Securities Exchange Act of 1934 (the "1934 Act") and the 1940 Act; (ii) such as may be required by state securities laws and (iii) such as may be required under Maryland law for the acceptance for record of the Articles of Transfer by the Department. 5.4 Noncontravention. CGF is not, and the execution, delivery and performance of this Agreement by CGF will not result in, a violation of the laws of the State of Maryland or of the Articles of Incorporation or the By-laws of CGF, or of any material agreement, indenture, instrument, contract, lease or other undertaking to which CGF is a party or by which it is bound, and the execution, delivery and performance of this Agreement by CGF will not result in the acceleration of any obligation, or the A-4 imposition of any penalty, under any agreement, indenture, instrument, contract, lease, judgment or decree to which CGF is a party or by which it is bound. 5.5 Financial Statements. CIK has been furnished with a statement of assets, liabilities and capital and a schedule of investments of CGF, each as of December 31, 2000, said financial statements having been examined by PricewaterhouseCoopers LLP, independent public accountants. These financial statements are in accordance with generally accepted accounting principles applied on a consistent basis ("GAAP") and present fairly, in all material respects, the financial position of CGF as of such date in accordance with GAAP, and there are no known contingent liabilities of CGF required to be reflected on a balance sheet (including the notes thereto) in accordance with GAAP as of such date not disclosed therein. 5.6 Title to Assets. At the Effective Date, CGF will have good and marketable to the assets to be transferred to CIK pursuant to paragraph 2.1 and full right, power and authority to sell, assign, transfer and deliver such assets hereunder free of any liens or other encumbrances, except those liens or encumbrances as to which CIK has received notice at or prior to the Closing, and upon delivery and payment for such assets and the effectiveness of the Articles of Transfer, CIK will acquire good and marketable title thereto, subject to no restrictions on the full transfer thereof, including such restrictions as might arise under the 1933 Act and the 1940 Act, except those restrictions as to which CIK has received notice and necessary documentation at or prior to the Closing. 5.7 Annual Report. CIK has been furnished with CGF's Annual Report to Shareholders for the fiscal year ended December 31, 2000. 5.8 Qualification, Corporate Power, Authorization of Transaction. CGF has full power and authority to enter into and perform its obligations under this Agreement. The execution, delivery and performance of this Agreement has been duly authorized by all necessary action of its Board of Directors, and, subject to shareholder approval, this Agreement constitutes a valid and binding contract enforceable in accordance with its terms, subject to the effects of bankruptcy, insolvency, moratorium, fraudulent conveyance and similar laws relating to or affecting creditors' rights generally and court decisions with respect thereto. 5.9 Legal Compliance. Except as may have been previously disclosed to and accepted by CIK, no material litigation or administrative proceeding or investigation of or before any court or governmental body is presently pending (in which service of process has been received) or, to its knowledge, threatened against CGF or any properties or assets held by it. Except as may have been previously disclosed to and accepted by CIK, CGF knows of no facts which might form the basis for the institution of such proceedings which would materially and adversely affect its business and is not a party to or subject to the provisions of any order, decree or judgment of any court or governmental body which materially and adversely affects its business or its ability to consummate the transactions herein contemplated. 5.10 Material Contracts. There are no material contracts outstanding to which CGF is a party that have not been disclosed in the Registration Statement (as defined in Section 3.13 below) or will not be otherwise disclosed to CIK prior to the Effective Date. 5.11 Undisclosed Liabilities. Since December 31, 2000, there has not been any material adverse change in CGF's financial condition, assets, liabilities or business and CGF has no known liabilities of a material amount, contingent or otherwise, required to be disclosed in a balance sheet in accordance with GAAP other than those shown on CGF's statements of assets, liabilities and capital referred to above, those incurred in the ordinary course of its business as an investment company since A-5 December 31, 2000, and those incurred in connection with the Reorganization. There are no contracts or other commitments (other than this Agreement) of CGF which will be terminated with liability to CGF prior to the Effective Date. Prior to the Effective Date, CGF will advise CIK in writing of all known liabilities, contingent or otherwise, whether or not incurred in the ordinary course of business, existing or accrued. For purposes of this Section 5.11, a decline in net asset value per share of CGF due to declines in market values of securities in CGF's portfolio or the discharge of CGF liabilities will not constitute a material adverse change. 5.12 Tax Filings. All federal and other tax returns and information reports of CGF required by law to have been filed shall have been filed and are or will be correct in all material respects, and all federal and other taxes shown as due or required to be shown as due on said returns and reports shall have been paid or provision shall have been made for the payment thereof, and, to the best of CGF's knowledge, no such return is currently under audit and no assessment has been asserted with respect to such returns. All tax liabilities of CGF have been adequately provided for on its books, and no tax deficiency or liability of CGF has been asserted and no question with respect thereto has been raised by the Internal Revenue Service or by any state or local tax authority for taxes in excess of those already paid, up to and including the taxable year in which the Effective Date occurs. 5.13 Qualification Under Subchapter M. For each taxable year of its operation (including the taxable year ending on the Effective Date), CGF has met the requirements of Subchapter M of the Code for qualification as a RIC and has elected to be treated as such, has been eligible to and has computed its federal income tax under Section 852 of the Code, and will have distributed substantially all of its investment company taxable income and net realized capital gain (as defined in the Code) that has accrued through the Effective Date. 5.14 Form N-14. The registration statement to be filed by CIK on Form N-14 relating to CIK Shares to be issued pursuant to this Agreement, and any supplement or amendment thereto or to the documents therein (as amended, the "Registration Statement"), on the effective date of the Registration Statement, at the time of the shareholders' meetings referred to in Article 6 of this Agreement and at the Effective Date, insofar as it relates to CGF (i) shall have complied or will comply in all material respects with the provisions of the 1933 Act, the 1934 Act and the 1940 Act and the rules and regulations thereunder and (ii) did not and will not contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein not misleading; and the prospectus included therein did not and will not contain any untrue statement of a material fact or omit to state any material fact necessary to make the statements therein, in light of the circumstances under which they were made, not misleading; PROVIDED, HOWEVER, that the representations and warranties in this Section 5.14 shall only apply to statements in, or omissions from, the Registration Statement made in reliance upon and in conformity with information furnished by CGF for use in the Registration Statement. 5.15 Capitalization. (a) All issued and outstanding shares of CGF (i) have been offered and sold in compliance in all material respects with applicable registration requirements of the 1933 Act and state securities laws, (ii) are, and on the Effective Date will be, duly and validly issued and outstanding, fully paid and non-assessable, and (iii) will be held at the time of the Closing by the persons and in the amounts set forth in the records of the transfer agent as provided in Section 6.7. CGF does not have outstanding any options, warrants or other rights to subscribe for or purchase any CGF shares, nor is there outstanding any security convertible into, or exchangeable for, any CGF shares. A-6 (b) CGF is authorized to issue 100,000,000 shares of stock, par value $0.001 per share, all of which shares are classified as Common Stock and each outstanding share of which is fully paid, non-assessable and has full voting rights. 5.16 Books and Records. The books and records of CGF made available to CIK are substantially true and correct and contain no material misstatements or omissions with respect to the operations of CGF. 5.17 CIK Shares. The CIK Shares to be issued hereunder are not being acquired for the purpose of making any distribution thereof other than in accordance with the terms of this Agreement. 6. REPRESENTATIONS AND WARRANTIES OF CREDIT SUISSE ASSET MANAGEMENT INCOME FUND, INC. CIK represents and warrants to CGF that the statements contained in this Article 6 are correct and complete in all material respects as of the execution of this Agreement on the date hereof. CIK represents and warrants to, and agrees with, CGF that: 6.1 Organization. CIK is a corporation duly organized and validly existing under the laws of the State of Maryland and is in good standing with the Department, and has the corporate power to own all of its assets and to carry on its business as it is now being conducted and to carry out this Agreement. 6.2 Registrations and Qualifications. CIK is duly registered under the 1940 Act as a closed-end, diversified management investment company (File No. 811-05012) and such registration has not been revoked or rescinded and is in full force and effect. CIK has elected and qualified for the special tax treatment afforded RICs under Sections 851-855 of the Code at all times since its inception. CIK is qualified as a foreign corporation in every jurisdiction where required, except to the extent that failure to so qualify would not have a material adverse effect on CIK. 6.3 Regulatory Consents and Approvals. No consent, approval, authorization or order of any court or governmental authority is required for the consummation by CIK of the transactions contemplated herein, except (i) such as have been obtained or applied for under the 1933 Act, the 1934 Act and the 1940 Act, (ii) such as may be required by state securities laws and (iii) such as may be required under Maryland law for the acceptance for record of the Articles of Transfer by the Department. 6.4 Noncontravention. CIK is not, and the execution, delivery and performance of this Agreement by CIK will not result, in violation of the laws of the State of Maryland or of the Articles of Incorporation or the By-laws of CIK, or of any material agreement, indenture, instrument, contract, lease or other undertaking to which CIK is a party or by which it is bound, and the execution, delivery and performance of this Agreement by CIK will not result in the acceleration of any obligation, or the imposition of any penalty, under any agreement, indenture, instrument, contract, lease, judgment or decree to which CIK is a party or by which it is bound. 6.5 Financial Statements. CGF has been furnished with a statement of assets, liabilities and capital and a schedule of investments of CIK, each as of December 31, 2000, said financial statements having been examined by PricewaterhouseCoopers LLP, independent public accountants. These financial statements are in accordance with GAAP and present fairly, in all material respects, the financial position of CIK as of such date in accordance with GAAP, and there are no known contingent liabilities of CIK required to be reflected on a balance sheet (including the notes thereto) in accordance with GAAP as of such date not disclosed therein. A-7 6.6 Title to Assets. At the Effective Date, CIK will have good and marketable to its assets. 6.7 Annual Report. CGF has been furnished with CIK's Annual Report to Shareholders for the fiscal year ended December 31, 2000. 6.8 Qualification, Corporate Power, Authorization of Transaction. CIK has full power and authority to enter into and perform its obligations under this Agreement. The execution, delivery and performance of this Agreement has been duly authorized by all necessary action of its Board of Directors, and, subject to shareholder approval, this Agreement constitutes a valid and binding contract enforceable in accordance with its terms, subject to the effects of bankruptcy, insolvency, moratorium, fraudulent conveyance and similar laws relating to or affecting creditors' rights generally and court decisions with respect thereto. 6.9 Legal Compliance. Except as may have been previously disclosed to and accepted by CGF, no material litigation or administrative proceeding or investigation of or before any court or governmental body is presently pending (in which service of process has been received) or, to its knowledge, threatened against CIK or any properties or assets held by it. Except as may have been previously disclosed to and accepted by CGF, CIK knows of no facts which might form the basis for the institution of such proceedings which would materially and adversely affect its business and is not a party to or subject to the provisions of any order, decree or judgment of any court or governmental body which materially and adversely affects its business or its ability to consummate the transactions herein contemplated. 6.10 Material Contracts. There are no material contracts outstanding to which CIK is a party that have not been disclosed in the Registration Statement or will not be otherwise disclosed to CGF prior to the Effective Date. 6.11 Undisclosed Liabilities. Since December 31, 2000, there has not been any material adverse change in CIK's financial condition, assets, liabilities, or business and CIK has no known liabilities of a material amount, contingent or otherwise, required to be disclosed in a balance sheet with GAAP other than those shown on CIK's statements of assets, liabilities and capital referred to above, those incurred in the ordinary course of its business as an investment company since December 31, 2000, and those incurred in connection with the Reorganization. Prior to the Effective Date, CIK will advise CGF in writing of all known liabilities, contingent or otherwise, whether or not incurred in the ordinary course of business, existing or accrued. For purposes of this Section 6.11, a decline in net asset value per share of CIK due to declines in market values of securities in CIK's portfolio or the discharge of CIK liabilities will not constitute a material adverse change. 6.12 Tax Filings. All federal and other tax returns and information reports of CIK required by law to have been filed shall have been filed and are or will be correct in all material respects, and all federal and other taxes shown as due or required to be shown as due on said returns and reports shall have been paid or provision shall have been made for the payment thereof, and, to the best of CIK's knowledge, no such return is currently under audit and no assessment has been asserted with respect to such returns. All tax liabilities of CIK have been adequately provided for on its books, and no tax deficiency or liability of CIK has been asserted and no question with respect thereto has been raised by the Internal Revenue Service or by any state or local tax authority for taxes in excess of those already paid, up to and including the taxable year in which the Effective Date occurs. 6.13 Qualification Under Subchapter M. For each taxable year of its operation, CIK has met the requirements of Subchapter M of the Code for qualification as a RIC and has elected to be treated as such, has been eligible to and has computed its federal income tax under Section 852 of the Code, and A-8 will have distributed substantially all of its investment company taxable income and net realized capital gain (as defined in the Code) that has accrued through the Effective Date. 6.14 Form N-14. The Registration Statement, on the effective date of the Registration Statement, at the time of the shareholders' meetings referred to in Section 6 of this Agreement and at the Effective Date, insofar as it relates to CIK (i) shall have complied or will comply in all material respects with the provisions of the 1933 Act, the 1934 Act and the 1940 Act and the rules and regulations thereunder and (ii) did not and will not contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein not misleading; and the prospectus included therein did not and will not contain any untrue statement of a material fact or omit to state any material fact necessary to make the statements therein, in light of the circumstances under which they were made, not misleading; PROVIDED, HOWEVER, that the representations and warranties in this Section 4.13 shall not apply to statements in, or omissions from, the Registration Statement made in reliance upon and in conformity with information furnished by CGF for use in the Registration Statement. 6.15 Capitalization. (a) All issued and outstanding shares of CIK (i) have been offered and sold in compliance in all material respects with applicable registration requirements of the 1933 Act and state securities laws, (ii) are, and on the Effective Date will be, duly and validly issued and outstanding, fully paid and non-assessable, and (iii) will be held at the time of the Closing by the persons and in the amounts set forth in the records of the transfer agent. CIK does not have outstanding any options, warrants or other rights to subscribe for or purchase any CIK shares, nor is there outstanding any security convertible into, or exchangeable for, any CIK shares. (b) CIK is authorized to issue 100,000,000 shares of stock, par value $0.001 per share, all of which shares are classified as Common Stock and each outstanding share of which is fully paid, non-assessable and has full voting rights. 6.16 Issuance of Stock. (a) The offer and sale of the shares to be issued pursuant to this Agreement shall be in compliance with all applicable federal and state securities laws. (b) The CIK Shares to be issued and delivered to CGF, for the account of CGF's shareholders pursuant to the terms of this Agreement will at the Effective Date have been duly authorized and when so issued and delivered, will be duly and validly issued CIK Shares, and will be fully paid and non-assessable with no personal liability attaching to the ownership thereof. (c) At or prior to the Effective Date, CIK shall have obtained any and all regulatory, director and shareholder approvals necessary to issue CIK Shares. 6.17 Books and Records. The books and records of CIK made available to CGF are substantially true and correct and contain no material misstatements or omissions with respect to the operations of CIK. A-9 7. COVENANTS OF THE PARTIES 7.1 Shareholders' Meetings. (a) Each of the Parties shall hold a meeting of its respective shareholders for the purpose of considering the Reorganization as described herein, which meeting has been called by each Party for May 1, 2001, and any adjournments thereof. (b) Each of the Parties agrees to mail to each of its respective shareholders of record entitled to vote at the meeting of shareholders at which action is to be considered regarding the Reorganization, in sufficient time to comply with requirements as to notice thereof, a combined Proxy Statement and Prospectus which complies in all material respects with the applicable provisions of Section 14(a) of the 1934 Act and Section 20(a) of the 1940 Act, and the rules and regulations, respectively, thereunder. 7.2 Operations in the Normal Course. Each Party covenants to operate its business in the ordinary course between the date hereof and the Effective Date, it being understood that such ordinary course of business will include (i) the declaration and payment of customary dividends and other distributions and (ii) in the case of CGF, preparing for its dissolution and deregistration, except that the distribution of dividends pursuant to Sections 7.11 and 8.9 of this Agreement shall not be deemed to constitute a breach of the provisions of this Section 6.2. 7.3 Articles of Transfer. The Parties agree that, as soon as practicable after satisfaction of all conditions to the Reorganization, they will jointly file executed Articles of Transfer with the Department and make all other filings or recordings required by Maryland law in connection with the Reorganization. 7.4 Regulatory Filings. (a) CGF undertakes that, if the Reorganization is consummated, it will file, or cause its agents to file, an application pursuant to Section 8(f) of the 1940 Act for an order declaring that CGF has ceased to operate as a registered investment company. (b) CIK will file the Registration Statement with the Securities and Exchange Commission ("SEC") and will use its best efforts to ensure that the Registration Statement becomes effective as promptly as practicable. CGF agrees to cooperate fully with CIK, and will furnish to CIK the information relating to itself to be set forth in the Registration Statement as required by the 1933 Act, the 1934 Act, the 1940 Act, the rules and regulations thereunder and the state securities or blue sky laws. 7.5 Preservation of Assets. CIK agrees that it has no plan or intention to sell or otherwise dispose of the assets of CGF to be acquired in the Reorganization, except for dispositions made in the ordinary course of business. 7.6 Tax Matters. Each of the Parties agrees that by the Effective Date all of its federal and other tax returns and reports required to be filed on or before such date shall have been filed and all taxes shown as due on said returns either have been paid or adequate liability reserves have been provided for the payment of such taxes. In connection with this covenant, the Parties agree to cooperate with each other in filing any tax return, amended return or claim for refund, determining a liability for taxes or a right to a refund of taxes or participating in or conducting any audit or other proceeding in respect of taxes. CIK agrees to retain for a period of ten (10) years following the Effective Date all returns, schedules and work papers and all material records or other documents relating to tax matters of CGF for its final taxable year and for all prior taxable periods. Any information obtained under this Section 7.6 shall be kept confidential except as otherwise may be necessary in connection with the filing of returns or A-10 claims for refund or in conducting an audit or other proceeding. After the Effective Date, CIK shall prepare, or cause its agents to prepare, any federal, state or local tax returns, including any Forms 1099, required to be filed and provided to required persons by CGF with respect to its final taxable years ending with the Effective Date and for any prior periods or taxable years for which the due date for such return has not passed as of the Effective Date and further shall cause such tax returns and Forms 1099 to be duly filed with the appropriate taxing authorities and provided to required persons. Notwithstanding the aforementioned provisions of this Section 7.6, any expenses incurred by CIK (other than for payment of taxes) in excess of any accrual for such expenses by CGF in connection with the preparation and filing of said tax returns and Forms 1099 after the Effective Date shall be borne by CIK. 7.7 Delisting, Termination of Registration as an Investment Company. CGF agrees that the (i) delisting of the shares of CGF with the NYSE, (ii) termination of its registration as a RIC and (iii) its dissolution under Maryland law will be effected in accordance with applicable law as soon as practicable following the Effective Date. 7.8 Transfer Taxes. Any transfer taxes payable upon issuance of CIK Shares in a name other than the registered holder of shares of CGF on the books of CGF as of that time shall, as a condition of such issuance and transfer, be paid by the person to whom such CIK Shares are to be issued and transferred. 7.9 Reporting. Any reporting responsibility of CGF is and shall remain the responsibility of CGF up to and including the applicable Effective Date and such later dates on which CGF is terminated. 7.10 Surrender of CGF Stock Certificates. With respect to any CGF shareholder holding certificates representing shares of CGF as of the Effective Date, and subject to CIK being informed thereof in writing by CGF, CIK will not permit such shareholder to receive new certificates evidencing ownership of CIK Shares until such shareholder has surrendered his or her outstanding certificates evidencing ownership of shares of CGF or, in the event of lost certificates, posted adequate bond. CGF will request its shareholders to surrender their outstanding certificates representing certificates of shares of CGF or post adequate bond therefor. Dividends payable to holders of record of CIK Shares as of any date after the Effective Date and prior to the exchange of certificates by any shareholder of CGF shall be paid to such shareholder, without interest; however, such dividends shall not be paid unless and until such shareholder surrenders his or her stock certificates of CGF for exchange. 8. CONDITIONS PRECEDENT TO OBLIGATIONS OF CREDIT SUISSE ASSET MANAGEMENT INCOME FUND, INC. The obligations of CIK hereunder shall be subject to the following conditions: 8.1 Approval of Reorganization. This Agreement shall have been approved by (i) the affirmative vote of the holders of a majority of the shares of Common Stock of CGF issued and outstanding and entitled to vote thereon and (ii) the affirmative vote of a majority of the CIK Shares voted thereon, provided also that the votes cast represent at least a majority of the shares of Common Stock of CIK issued and outstanding and entitled to vote thereon; and CGF shall have delivered to CIK a copy of the resolutions approving this Agreement adopted by its Board of Directors and shareholders, certified by its secretary. 8.2 Certificates and Statements by Credit Suisse Asset Management Strategic Global Income Fund, Inc. A-11 (a) CGF shall have furnished a statement of assets, liabilities and capital, together with a schedule of investments with their respective dates of acquisition and tax costs, certified on its behalf by its President (or any Vice President) and its Treasurer, and a certificate executed by both such officers, dated the Effective Date, certifying that there has been no material adverse change in its financial position since December 31, 2000, other than changes in its portfolio securities since that date or changes in the market value of its portfolio securities. (b) CGF shall have furnished to CIK a certificate signed by its President (or any Vice President), dated the Effective Date, certifying that as of the Effective Date, all representations and warranties made in this Agreement are true and correct in all material respects as if made at and as of such date and each has complied with all of the agreements and satisfied all of the conditions on its part to be performed or satisfied at or prior to such dates. (c) CGF shall have delivered to CIK a letter from PricewaterhouseCoopers LLP, dated the Effective Date, stating that such firm has performed a limited review of the federal, state and local income tax returns for the period ended December 31, 2000, and that based on such limited review, nothing came to their attention which caused them to believe that such returns did not properly reflect, in all material respects, the federal, state and local income taxes of CGF for the period covered thereby; and that for the period from December 31, 2000 to and including the Effective Date and for any taxable year ending upon the effective Date, such firm has performed a limited review to ascertain the amount of such applicable federal, state and local taxes, and has determined that either such amount has been paid or reserves have been established for payment of such taxes, this review to be based on unaudited financial data; and that based on such limited review, nothing has come to their attention which caused them to believe that the taxes paid or reserves set aside for payment of such taxes were not adequate in all material respects for the satisfaction of federal, state and local taxes for the period from December 31, 2000, to and including the Effective Date and for any taxable year ending upon the Effective Date or that CGF would not continue to qualify as a RIC for federal income tax purposes. 8.3 Absence of Litigation. There shall be no material litigation pending with respect to the matters contemplated by this Agreement, except as may have been previously disclosed to and accepted by CIK. 8.4 Legal Opinions. (a) CIK shall have received an opinion of Willkie Farr & Gallagher, as counsel to CGF, in form and substance reasonably satisfactory to CIK and dated the Effective Date, to the effect that (i) CGF is a corporation duly organized and validly existing under the laws of the State of Maryland and in good standing with the Department; (ii) CGF has the corporate power to carry on its business as presently conducted in accordance with the description thereof in CIK's Registration Statement, (iii) the Agreement has been duly authorized, executed and delivered by CGF and constitutes a valid and legally binding obligation of CGF, enforceable in accordance with its terms, except as enforceability may be limited by bankruptcy, insolvency, reorganization or other similar laws pertaining to the enforcement of creditors' rights generally and by equitable principles; (iv) to such counsel's knowledge, no consent, approval, authorization or order of any United States federal or Maryland state court or governmental authority is required for the consummation by CGF of the Reorganization, except such as may be required and have been obtained under the 1933 Act, the 1934 Act, the 1940 Act, the published rules and regulations of the SEC thereunder and under Maryland law and such as may be required by state securities or blue sky laws; (v) the Registration Statement has become effective under the 1933 Act, no stop order suspending the effectiveness of the Registration Statement has been issued and no proceedings for that purpose have been instituted or are pending or contemplated under the 1933 Act, and with respect to CGF, the Registration Statement, and each amendment or supplement thereto, as of their respective effective dates, appear on A-12 their face to be appropriately responsive in all material respects to the requirement of the 1933 Act, the 1934 Act and the 1940 Act and the published rules and regulations of the SEC thereunder; (vi) such counsel does not know of any statutes, legal or governmental proceedings or contracts with respect to CGF or other documents related to the Reorganization of a character required to be described in the Registration Statement which are not described therein or, if required to be filed, filed as required; (vii) the execution and delivery of this Agreement does not, and the consummation of the Reorganization will not, violate any material provision of the Articles of Incorporation, as amended, the by-laws, as amended, or any agreement (known to such counsel) to which CGF is a party or by which CGF is bound; (viii) to the best of such counsel's knowledge, no material suit, action or legal or administrative proceeding is pending or threatened against CGF; and (ix) all corporate actions required to be taken by CGF to authorize this Agreement and to effect the Reorganization have been duly authorized by all necessary corporate actions on behalf of CGF. Such counsel shall also state that (A) while such counsel cannot make any representation as to the accuracy or completeness of statements of fact in the Registration Statement or any amendment or supplement thereto with respect to CGF, nothing has come to their attention that would lead them to believe that, on the respective effective dates of the Registration Statement and any amendment or supplement thereto with respect to CGF, (1) the Registration Statement or any amendment or supplement thereto contained any untrue statement of a material fact or omitted to state any material fact required to be stated therein or necessary to make the statements therein not misleading with respect to CGF, and (2) the prospectus included in the Registration Statement contained any untrue statement of a material fact or omitted to state any material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading with respect to CGF; provided that such counsel need not express any opinion or belief as to the financial statements, other financial data, statistical data or information relating to CGF contained or incorporated by reference in the Registration Statement. In giving the opinion set forth above, Willkie Farr & Gallagher may state that it is relying on certificates of officers of CGF with regard to matters of fact and certain certificates and written statements of governmental officials with respect to the good standing of CGF and on the opinion of Venable, Baetjer and Howard, LLP, as to matters of Maryland law. (b) CIK shall have received an opinion from Willkie Farr & Gallagher, as counsel to CGF, dated the Effective Date, to the effect that for federal income tax purposes (i) the Reorganization as provided in this Agreement will constitute a reorganization within the meaning of Section 368(a)(1)(C) of the Code and that CIK and CGF will each be a "party to a reorganization" within the meaning of Section 368(b) of the Code; (ii) no gain or loss will be recognized by CGF as a result of the Reorganization or upon the conversion of CGF shares to CIK Shares; (iii) no gain or loss will be recognized by CIK as a result of the Reorganization; (iv) no gain or loss will be recognized by the shareholders of CGF upon the conversion of their shares into CIK Shares except to the extent such shareholders are paid cash in lieu of fractional CIK Shares in the Reorganization; (v) the tax basis of CGF assets in the hands of CIK will be the same as the tax basis of such assets in the hands of CGF immediately prior to the consummation of the Reorganization; (vi) immediately after the Reorganization, the tax basis of CIK Shares received by each shareholder of CGF in the Reorganization (including that of fractional share interests purchased from such shareholder by the Surviving Fund) will be equal, in the aggregate, to the tax basis of the shares of CGF owned by such shareholder immediately prior to the Reorganization; (vii) a shareholder's holding period for CIK Shares (including that of fractional share interests purchased from such shareholder by the Surviving Fund) will be determined by including the period for which he or she held shares of CGF exchanged pursuant to the Reorganization, provided, that such shares of CGF were held as capital assets; (viii) CIK's holding period with respect to the CGF assets transferred will include the period for which such assets were held by CGF; and (ix) the payment of cash to a CGF shareholder in lieu of fractional CIK Shares will be treated as though the fractional shares were distributed as part of the Reorganization and then redeemed by CIK with the result that the CGF shareholder will have a capital gain or loss to the extent the cash distribution differs from such shareholder's basis allocable to the fractional shares, provided that the shares of CGF exchanged pursuant to the Reorganization were held as A-13 capital assets immediately prior to such exchange and that the shareholder's proportionate interest in CIK will be reduced as a result of such cash distribution. 8.5 Auditor's Consent and Certification. CIK shall have received from PricewaterhouseCoopers LLP a letter dated as of the effective date of the Registration Statement and a similar letter dated within five days prior to the Effective Date, in form and substance satisfactory to CIK, to the effect that (i) they are independent public auditors with respect to CGF within the meaning of the 1933 Act and the applicable published rules and regulations thereunder; and (ii) in their opinion, the financial statements of CGF audited by PricewaterhouseCoopers LLP which are included or incorporated by reference in the Registration Statement and reported on by them comply as to form in all material respects with the applicable accounting requirements of the 1933 Act and the published rules and regulations thereunder. 8.6 Liabilities. The assets or liabilities of CGF to be transferred to CIK shall not include any assets or liabilities which CIK, by reason of limitations in its investment objective and policies as in effect upon the consummation of the Reorganization or Articles of Incorporation, may not properly acquire or assume. CIK does not anticipate that there will be any such assets or liabilities but CIK will notify CGF if any do exist and will reimburse CGF for any reasonable transaction costs incurred by CGF for the liquidation of such assets and liabilities. 8.7 Effectiveness of Registration Statement. The Registration Statement shall have become effective under the 1933 Act and no stop order suspending such effectiveness shall have been instituted or, to the knowledge of CIK, contemplated by the SEC. 8.8 Regulatory Filings. (a) CIK shall have received from the SEC such orders or interpretations as Willkie Farr & Gallagher, as counsel to CIK, deems reasonably necessary or desirable under the 1933 Act and the 1940 Act in connection with the Reorganization, PROVIDED, that such counsel shall have requested such orders as promptly as practicable, and all such orders shall be in full force and effect. (b) Any applicable waiting period under the HSR Act relating to the transactions contemplated hereby shall have expired or been terminated. 8.9 Administrative Rulings, Proceedings. The SEC shall not have issued an unfavorable advisory report under Section 25(b) of the 1940 Act, nor instituted or threatened to institute any proceeding seeking to enjoin consummation of the Reorganization under Section 25(c) of the 1940 Act; and no other legal, administrative or other proceeding shall be instituted or threatened which would materially affect the financial condition of CGF or would prohibit the Reorganization. 8.10 Satisfaction of Credit Suisse Asset Management Income Fund, Inc. All proceedings taken by CGF and its counsel in connection with the Reorganization and all documents incidental thereto shall be satisfactory in form and substance to CIK. 8.11 Dividends. Prior to the Effective Date, CGF shall have declared and paid a dividend or dividends which, together with all such previous dividends, shall have the effect of distributing to its shareholders substantially all of its net investment company taxable income that has accrued through the Effective Date, if any (computed without regard to any deduction of dividends paid), and substantially all of its net capital gain, if any, realized through the Effective Date. A-14 8.12 Custodian's Certificate. CGF's custodian shall have delivered to CIK a certificate identifying all of the assets of CGF held or maintained by such custodian as of the Valuation Time. 8.13 Books and Records. CGF's transfer agent shall have provided to CIK (i) the originals or true copies of all of the records of CGF in the possession of such transfer agent as of the Effective Date, (ii) a certificate setting forth the number of shares of CGF outstanding as of the Valuation Time, and (iii) the name and address of each holder of record of any shares and the number of shares held of record by each such shareholder. 9. CONDITIONS PRECEDENT TO THE OBLIGATIONS OF CREDIT SUISSE ASSET MANAGEMENT STRATEGIC GLOBAL INCOME FUND, INC. The obligations of CGF hereunder shall be subject to the following conditions: 9.1 Approval of Reorganization. This Agreement shall have been approved by (i) the affirmative vote of the holders of a majority of the shares of Common Stock of CGF issued and outstanding and entitled to vote thereon and (ii) the affirmative vote of a majority of the CIK Shares voted thereon, provided also that the votes cast represent at least a majority of the shares of Common Stock of CIK issued and outstanding and entitled to vote thereon; and CIK shall have delivered to CGF a copy of the resolutions approving this Agreement adopted by its Board of Directors and shareholders, certified by its secretary. 9.2 Certificates and Statements by Credit Suisse Asset Management Income Fund, Inc. (a) CIK shall have furnished a statement of assets, liabilities and capital, together with a schedule of investments with their respective dates of acquisition and tax costs, certified on its behalf by its President (or any Vice President) and its Treasurer, and a certificate executed by both such officers, dated the Effective Date, certifying that there has been no material adverse change in its financial position since December 31, 2000, other than changes in its portfolio securities since that date or changes in the market value of its portfolio securities. (b) CIK shall have furnished to CGF a certificate signed by its President (or any Vice President), dated the Effective Date, certifying that as of the Effective Date, all representations and warranties made in this Agreement are true and correct in all material respects as if made at and as of such date and each has complied with all of the agreements and satisfied all of the conditions on its part to be performed or satisfied at or prior to such dates. (c) CIK shall have delivered to CGF a letter from PricewaterhouseCoopers LLP, dated the Effective Date, stating that such firm has performed a limited review of the federal, state and local income tax returns for the period ended December 31, 2000, and that based on such limited review, nothing came to their attention which caused them to believe that such returns did not properly reflect, in all material respects, the federal, state and local income taxes of CIK for the period covered thereby; and that for the period from December 31, 2000 to and including the Effective Date, such firm has performed a limited review to ascertain the amount of such applicable federal, state and local taxes, and has determined that either such amount has been paid or reserves established for payment of such taxes, this review to be based on unaudited financial data; and that based on such limited review, nothing has come to their attention which caused them to believe that the taxes paid or reserves set aside for payment of such taxes were not adequate in all material respects for the satisfaction of federal, state and local taxes for the period from December 31, 2000, to and including the Effective Date or that CIK would not continue to qualify as a RIC for federal income tax purposes. A-15 9.3 Absence of Litigation. There shall be no material litigation pending with respect to the matters contemplated by this Agreement, except as may have been previously disclosed to and accepted by CGF. 9.4 Legal Opinions. (a) CGF shall have received an opinion of Willkie Farr & Gallagher, as counsel to CIK, in form and substance reasonably satisfactory to CGF and dated the Effective Date, to the effect that (i) CIK is a corporation duly organized and validly existing under the laws of the State of Maryland and in good standing with the Department; (ii) CIK has the corporate power to carry on its business as presently conducted in accordance with the description thereof in CIK's Registration Statement; (iii) the Agreement has been duly authorized, executed and delivered by CIK, and constitutes a valid and legally binding obligation of CIK, enforceable in accordance with its terms, except as enforceability may be limited by bankruptcy, insolvency, reorganization or other similar laws pertaining to the enforcement of creditors' rights generally and by equitable principles; (iv) to such counsel's knowledge, no consent, approval, authorization or order of any United States federal or Maryland state court or governmental authority is required for the consummation by CIK of the Reorganization, except such as may be required and have been obtained under the 1933 Act, the 1934 Act, the 1940 Act and the published rules and regulations of the SEC thereunder and under Maryland law and such as may be required under state securities or blue sky laws; (v) the Registration Statement has become effective under the 1933 Act, no stop order suspending the effectiveness of the Registration Statement has been issued and no proceedings for that purpose have been instituted or are pending or contemplated under the 1933 Act, and, with respect to CIK, the Registration Statement, and each amendment or supplement thereto, as of their respective effective dates, appear on their face to be appropriately responsive in all material respects to the requirements of the 1933 Act, the 1934 Act and the 1940 Act and the published rules and regulations of the SEC thereunder; (vi) such counsel does not know of any statutes, legal or governmental proceedings or contracts with respect to CIK or other documents related to the Reorganization of a character required to be described in the Registration Statement which are not described therein or, if required to be filed, filed as required; (vii) the execution and delivery of this Agreement does not, and the consummation of the Reorganizations will not, violate any material provision of the Articles of Incorporation, as amended, the by-laws, as amended, or any agreement (known to such counsel) to which CIK is a party or by which CIK is bound; (viii) to the best of such counsel's knowledge, no material suit, action or legal or administrative proceeding is pending or threatened against CIK; and (ix) all corporate actions required to be taken by CIK to authorize this Agreement and to effect the Reorganization have been duly authorized by all necessary corporate actions on behalf of CIK. Such counsel shall also state that (A) while such counsel cannot make any representation as to the accuracy or completeness of statements of fact in the Registration Statement or any amendment or supplement thereto with respect to CIK, nothing has come to their attention that would lead them to believe that, on the respective effective dates of the Registration Statement and any amendment or supplement thereto, (1) the Registration Statement or any amendment or supplement thereto contained any untrue statement of a material fact or omitted to state any material fact required to be stated therein or necessary to make the statements therein not misleading with respect to CIK; and (2) the prospectus included in the Registration Statement contained any untrue statement of a material fact or omitted to state any material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading with respect to CIK; provided that such counsel need not express any opinion or belief as to the financial statements, other financial data, statistical data or information relating to CIK contained or incorporated by reference in the Registration Statement. In giving the opinion set forth above, Willkie Farr & Gallagher may state that it is relying on certificates of officers of CIK with regard to matters of fact and certain certificates and written statements of governmental officials with respect to the good standing of CIK and on the opinion of Venable, Baetjer and Howard, LLP as to matters of Maryland law. A-16 (b) CGF shall have received an opinion from Willkie Farr & Gallagher and dated the Effective Date, to the effect that for federal income tax purposes (i) the Reorganization as provided in this Agreement will constitute a reorganization within the meaning of Section 368(a)(1) of the Code and that CIK and CGF will each be a "party to a reorganization" within the meaning of Section 368(b) of the Code; (ii) no gain or loss will be recognized by CGF as a result of the Reorganization or upon the conversion of the shares of CGF to CIK Shares; (iii) no gain or loss will be recognized by CIK as a result of the Reorganization; (iv) no gain or loss will be recognized by the shareholders of CGF upon the conversion of their shares into CIK Shares except to the extent such shareholders are paid cash in lieu of fractional CIK Shares in the Reorganization; (v) the tax basis of CGF assets in the hands of CIK will be the same as the tax basis of such assets in the hands of CGF immediately prior to the consummation of the Reorganization; (vi) immediately after the Reorganization, the tax basis of CIK Shares received by each shareholder of CGF in the Reorganization (including that of fractional share interests purchased from such shareholder by CIK) will be equal, in the aggregate, to the tax basis of the shares of CGF owned by such shareholder immediately prior to the Reorganization; (vii) a shareholder's holding period for CIK Shares (including that of fractional share interests purchased from such shareholder by CIK) will be determined by including the period for which he or she held the shares of CGF exchanged pursuant to the Reorganization, provided, that such shares of CGF were held as capital assets; (viii) CIK's holding period with respect to the CGF assets transferred will include the period for which such assets were held by CGF; and (ix) the payment of cash to a CGF shareholder in lieu of fractional CIK Shares will be treated as though the fractional CIK Shares were distributed as part of the Reorganization and then redeemed by CIK with the result that the CGF shareholder will have a capital gain or loss to the extent the cash distribution differs from such shareholder's basis allocable to the fractional CIK Shares, provided that the shares of CGF exchanged therefor pursuant to the Reorganization were held as capital assets immediately prior to such exchange and that the shareholder's proportionate interest in CIK will be reduced as a result of such cash distribution. 9.5 Auditor's Consent and Certification. CGF shall have received from PricewaterhouseCoopers LLP a letter dated as of the effective date of the Registration Statement and a similar letter dated within five days prior to the Effective Date, in form and substance satisfactory to CGF, to the effect that (i) they are independent public auditors with respect to CIK within the meaning of the 1933 Act and the applicable published rules and regulations thereunder; and (ii) in their opinion, the financial statements of CIK audited by PricewaterhouseCoopers LLP which are included or incorporated by reference in the Registration Statement and reported on by them comply as to form in all material respects with the applicable accounting requirements of the 1933 Act and the published rules and regulations thereunder. 9.6 Effectiveness of Registration Statement. The Registration Statement shall have become effective under the 1933 Act and no stop order suspending such effectiveness shall have been instituted or, to the knowledge of CGF, contemplated by the SEC. 9.7 Regulatory Filings. (a) CGF shall have received from the SEC such orders or interpretations as Willkie Farr & Gallagher, as counsel to CGF, deems reasonably necessary or desirable under the 1933 Act and the 1940 Act in connection with the Reorganization, provided, that such counsel or counsel to CIK shall have requested such orders as promptly as practicable, and all such orders shall be in full force and effect. Any applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976 (the "HSR Act") relating to the transactions contemplated hereby shall have expired or been terminated. (b) The SEC shall not have issued an unfavorable advisory report under Section 25(b) of the 1940 Act, nor instituted or threatened to institute any proceeding seeking to enjoin consummation of the Reorganization under Section 25(c) of the 1940 Act; no other legal, administrative or other proceeding A-17 shall be instituted or threatened which would materially affect the financial condition of CGF or would prohibit the Reorganization. (c) CIK shall have received from any relevant state securities administrator such order or orders as are reasonably necessary or desirable under the 1933 Act, the 1934 Act, the 1940 Act and any applicable state securities or blue sky laws in connection with the transactions contemplated hereby, and that all such orders shall be in full force and effect. 9.8 Satisfaction of Credit Suisse Asset Management Strategic Global Income Fund, Inc. All proceedings taken by CIK and its counsel in connection with the Reorganization and all documents incidental thereto shall be satisfactory in form and substance to CGF. 10. PAYMENT OF EXPENSES 10.1 Allocation. All expenses incurred in connection with the Reorganization shall be allocated equally between CIK and CGF in the event the Reorganization is consummated. Such expenses shall include, but not be limited to, all costs related to the preparation and distribution of the Registration Statement, proxy solicitation expenses, legal and accounting fees, SEC registration fees and NYSE listing fees. Neither of the Parties owes any broker's or finder's fees in connection with the transactions provided for herein. 11. COOPERATION FOLLOWING EFFECTIVE DATE In case at any time after the Effective Date any further action is necessary to carry out the purposes of this Agreement, each of the Parties will take such further action (including the execution and delivery of such further instruments and documents) as any other Party may reasonably request, all at the sole cost and expense of the requesting Party (unless the requesting Party is entitled to indemnification as described below). CGF acknowledges and agrees that from and after the Effective Date, CIK shall be entitled to possession of all documents, books, records, agreements and financial data of any sort pertaining to CGF. 12. INDEMNIFICATION 12.1 Credit Suisse Asset Management Strategic Global Income Fund, Inc. CIK agrees to indemnify and hold harmless CGF and each of CGF's directors and officers from and against any and all losses, claims, damages, liabilities or expenses (including, without limitation, the payment of reasonable legal fees and reasonable costs of investigation) to which CGF or any of its directors or officers may become subject, insofar as any such loss, claim, damage, liability or expense (or actions with respect thereto) arises out of or is based on any breach by CIK of any of its representations, warranties, covenants or agreements set forth in this Agreement. 12.2 Credit Suisse Asset Management Income Fund, Inc. CGF agrees to indemnify and hold harmless CIK and each of CIK's directors and officers from and against any and all losses, claims, liabilities or expenses (including, without limitation, the payment of reasonable legal fees and reasonable costs of investigation) to which CIK or any of its directors or officers may become subject, insofar as any such loss, claim, damage, liability or expense (or actions with respect thereto) arises out of or is based on any breach by CGF of any of its representations, warranties, covenants or agreements set forth in this Agreement. A-18 13. TERMINATION, POSTPONEMENT AND WAIVERS 13.1 Termination. Notwithstanding anything to the contrary in this Agreement, this Agreement may be terminated and the Reorganization abandoned at any time (whether before or after adoption by the shareholders of each of the Parties) prior to the Effective Date, or the Effective Date may be postponed, (i) by mutual agreement of the Parties' Board of Directors; (ii) by the Board of Directors of CIK if any of the obligations of CGF set forth in this Agreement has not been fulfilled or waived by such Board or if CGF has made a material and intentional misrepresentation herein or in connection herewith; or (iii) by the Board of Directors of CGF if any of the obligations of CIK set forth in this Agreement has not been fulfilled or waived by such Board or if CIK has made a material and intentional misrepresentation herein or in connection herewith. (a) If the transaction contemplated by this Agreement shall not have been consummated by September 30, 2001, this Agreement automatically shall terminate on that date, unless a later date is mutually agreed to by the Boards of Directors of the Parties. (b) In the event of termination of this Agreement pursuant to the provisions hereof, the Agreement shall become void and have no further effect, and there shall not be any liability hereunder on the part of either of the Parties or their respective directors or officers, except for any such material breach or intentional misrepresentation, as to each of which all remedies at law or in equity of the party adversely affected shall survive. 13.2 Waiver. At any time prior to the Effective Date, any of the terms or conditions of this Agreement may be waived by the Board of Directors of either CGF or CIK (whichever is entitled to the benefit thereof), if, in the judgment of such Board after consultation with its counsel, such action or waiver will not have a material adverse effect on the benefits intended in this Agreement to the shareholders of the Fund, on behalf of which such action is taken. 13.3 Expiration of Representations and Warranties. (a) The respective representations and warranties contained in Articles 5 and 6 of this Agreement shall expire with, and be terminated by, the consummation of the Reorganization, and neither of the Parties nor any of their officers, directors, agents or shareholders shall have any liability with respect to such representations or warranties after the Effective Date. This provision shall not protect any officer, director, agent or shareholder of the Parties against any liability to the entity for which that officer, director, agent or shareholder so acts or to its shareholders to which that officer, director, agent or shareholder would otherwise be subject by reason of willful misfeasance, bad faith, gross negligence, or reckless disregard of the duties in the conduct of such office. (b) If any order or orders of the SEC with respect to this Agreement shall be issued prior to the Effective Date and shall impose any terms or conditions which are determined by action of the Boards of Directors of the Parties to be acceptable, such terms and conditions shall be binding as if a part of this Agreement without further vote or approval of the shareholders of the Parties, unless such terms and conditions shall result in a change in the method of computing the number of shares of CIK Shares to be issued pursuant to this Agreement, in which event, unless such terms and conditions shall have been included in the proxy solicitation materials furnished to the shareholders of the Parties prior to the meetings at which the Reorganization shall have been approved, this Agreement shall not be consummated and shall terminate unless the Parties call special meetings of shareholders at which such conditions so imposed shall be submitted for approval. A-19 14. MISCELLANEOUS 14.10 Transfer Restriction. Pursuant to Rule 145 under the 1933 Act, and in connection with the issuance of any shares to any person who at the time of the Reorganization is, to its knowledge, an affiliate of a party to the Reorganization pursuant to Rule 145(c), CIK shall cause to be affixed upon the certificate(s) issued to such person (if any) a legend as follows: THESE SHARES ARE SUBJECT TO RESTRICTIONS ON TRANSFER UNDER THE SECURITIES ACT OF 1933 AND MAY NOT BE SOLD OR OTHERWISE TRANSFERRED EXCEPT TO CREDIT SUISSE ASSET MANAGEMENT INCOME FUND, INC. (OR ITS STATUTORY SUCCESSOR) UNLESS (I) A REGISTRATION STATEMENT WITH RESPECT THERETO IS EFFECTIVE UNDER THE SECURITIES ACT OF 1933 OR (II) IN THE OPINION OF COUNSEL REASONABLY SATISFACTORY TO THE FUND, SUCH REGISTRATION IS NOT REQUIRED. and, further, that stop transfer instructions will be issued to CIK's transfer agent with respect to such shares. CGF will provide CIK on the Effective Date with the name of any CGF Shareholder who is to the knowledge of CGF an affiliate of it on such date. 14.2 Material Provisions. All covenants, agreements, representations and warranties made under this Agreement and any certificates delivered pursuant to this Agreement shall be deemed to have been material and relied upon by each of the parties, notwithstanding any investigation made by them or on their behalf. 14.3 Notices. All notices, requests, demands, claims, and other communications hereunder will be in writing. Any notice, request, demand, claim or other communication hereunder shall be deemed duly given if (and then two business days after) it is sent by registered or certified mail, return receipt requested, postage prepaid, and addressed to the intended recipient as set forth below: If to CGF: Hal Liebes, Esq. Senior Vice President Credit Suisse Asset Management Strategic Global Income Fund, Inc. 466 Lexington Avenue New York, New York 10017 With copies to: With copies to: Daniel Schloendorn, Esq. Willkie Farr & Gallagher 787 Seventh Avenue New York, New York 10019 Marco E. Adelfio, Esq. Morrison & Foerster 2000 Pennsylvania Avenue, N.W. Suite 5500 Washington, D.C. 20006 A-20 If to CIK: Hal Liebes, Esq. Senior Vice President Credit Suisse Asset Management Income Fund, Inc. 466 Lexington Avenue New York, New York 10017 With copies to: Daniel Schloendorn, Esq. Willkie Farr & Gallagher 787 Seventh Avenue New York, New York 10019 Marco E. Adelfio, Esq. Morrison & Foerster 2000 Pennsylvania Avenue, N.W. Suite 5500 Washington, D.C. 20006 Any Party may send any notice, request, demand, claim or other communication hereunder to the intended recipient at the address set forth above using any other means (including personal delivery, expedited courier, messenger service, telecopy, telex, ordinary mail, or electronic mail), but no such notice, request, demand, claim, or other communication shall be deemed to have been duly given unless and until it actually is received by the intended recipient. Any Party may change the address to which notices, requests, demands, claims and other communications hereunder are to be delivered by giving the other Parties notice in the manner herein set forth. 14.4 Amendments. This Agreement may be amended, modified or supplemented in such manner as may be mutually agreed upon in writing by the authorized officers of CGF and CIK; provided, however, that following the meeting of CGF and CIK shareholders to approve the Reorganization, no such amendment may have the effect of changing the provisions for determining the number of CIK shares to be issued to CGF shareholders under this Agreement to the detriment of such shareholders without their further approval. 14.5 Headings. The Article headings contained in this Agreement are for reference purposes only and shall not affect in any way the meaning or interpretation of this Agreement. 14.6 Counterparts. This Agreement may be executed in any number of counterparts, each of which shall be deemed an original. 14.7 Enforceability. Any term or provision of this Agreement that is invalid or unenforceable in any situation in any jurisdiction shall not affect the validity or enforceability of the remaining terms and provisions hereof or the validity or enforceability of the offending term or provision in any other situation or in any other jurisdiction. 14.8 Successors and Assigns. This Agreement shall bind and inure to the benefit of the parties hereto and their respective successors and assigns, but no assignment or transfer hereof or of any rights or obligations hereunder shall be made by any party without the written consent of the other party. Nothing herein expressed or implied is intended or shall be construed to confer upon or give any person, firm or A-21 corporation, other than the parties hereto and the shareholders of the Parties and their respective successors and assigns, any rights or remedies under or by reason of this Agreement. 14.9 Governing Law. This Agreement shall be governed by, and construed and enforced in accordance with the laws of the State of New York, without regard to its principles of conflicts of law. IN WITNESS WHEREOF, each of the Parties hereto has caused this Agreement to be executed by its President or Vice President and its seal to be affixed thereto and attested by its Secretary or Assistant Secretary. CREDIT SUISSE ASSET MANAGEMENT INCOME FUND, INC. By: ------------------------------------ Name: ------------------------------------ Attest: ------------------------------------ Title: ------------------------------------ CREDIT SUISSE ASSET MANAGEMENT STRATEGIC GLOBAL INCOME FUND, INC. By: ------------------------------------ Name: ------------------------------------ Attest: ------------------------------------ Title: ------------------------------------ A-22 (This page has been left blank intentionally.) A-23 EXHIBIT B FORM OF NEW CSAM INVESTMENT ADVISORY AGREEMENT CREDIT SUISSE ASSET MANAGEMENT INCOME FUND, INC. RESTATED INVESTMENT ADVISORY AGREEMENT AGREEMENT, made as of the 5th day of February, 2001 between Credit Suisse Asset Management Income Fund, Inc., a Maryland corporation (the "Fund"), and Credit Suisse Asset Management, LLC, a Delaware limited liability company (the "Adviser"). W I T N E S S E T H WHEREAS, the Fund is a diversified, closed-end investment company registered under the Investment Company Act of 1940, as amended (the "1940 Act"); WHEREAS, the Adviser provides investment advisory services to the Fund pursuant to an Investment Advisory Agreement with the Fund dated as of June 13, 1995 (the "Investment Advisory Agreement"); WHEREAS, following changes in the respective name of the Fund and of the Adviser, the parties executed an Addendum dated as of February 7, 2000 to amend the Investment Advisory Agreement to properly reflect the name of the Fund and the entity that is providing investment advisory services to the Fund; WHEREAS, the Adviser and the Fund have recently moved to new offices at 466 Lexington avenue, New York; and WHEREAS, the parties now wish to restate the Investment Advisory Agreement for the sole purposes of incorporating the changes made by the Addendum and properly reflecting the business address of the Adviser and the Fund and to make certain other ministerial changes. NOW, THEREFORE, in consideration of the premises and mutual promises hereinafter set forth, the parties hereto agree as follows: 1. The Fund hereby appoints the Adviser to act as investment adviser to the Fund. The Adviser accepts such appointment and agrees to render the services herein set forth, for the compensation herein provided. 2. Subject to the supervision of the Board of Directors of the Fund, the Adviser will manage the portfolio of securities and investments (including cash) belonging to the Fund including the purchase, retention and disposition thereof and the execution of agreements relating thereto, in accordance with the Fund's investment objective, policies and restrictions as stated in the Prospectus (as defined in paragraph 4(f) of this Agreement) and subject to the following understandings: (a) The Adviser shall furnish a continuous investment program for the Fund and in so doing shall determine from time to time what investments or securities will be purchased, retained or sold by the Fund, and what portion of the assets will be invested or held uninvested as cash; (b) The Adviser shall use its best judgment in the performance of its duties under this Agreement; (c) The Adviser, in the performance of its duties and obligations under this Agreement, shall act in conformity with the Articles of Incorporation, the Bylaws and Prospectus of the Fund and with the instructions and directions of the Board of Directors of the Fund and will conform to and comply with the requirements of the 1940 Act and all other applicable federal and state laws and regulations; (d) The Adviser shall determine the securities to be purchased or sold by the Fund and as agent for the Fund will effect portfolio transactions pursuant to its determinations either directly with the issuer or with any broker and/or dealer in such securities; in placing orders with brokers and/or dealers the Adviser intends to seek the best available price and execution for purchases and sales; the Adviser shall also determine whether or not the Fund shall enter into repurchase or reverse repurchase agreements; On occasions when the Adviser deems the purchase or sale of a security to be in the best interest of the Fund as well as other customers, the Adviser may, to the extent permitted by applicable laws and regulations, but shall not be obligated to, aggregate the securities to be sold or purchased in order to obtain the best execution and lower brokerage commissions, if any. 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 Adviser in the manner it considers to be the most equitable and consistent with its fiduciary obligations to the Fund and, if applicable, to such other customers; (e) The Adviser shall maintain books and records with respect to the securities transactions of the Fund and shall render to the Fund's Board of Directors such periodic and special reports as the Board of Directors may reasonably request; (f) The Adviser shall provide the Fund's Custodian as required with information relating to all transactions concerning the assets belonging to the Fund, except purchases of and any sales of the Fund's Common Stock ("Fund Shares"); and (g) The investment management services of the Adviser to the Fund under this Agreement are not to be deemed exclusive, and the Adviser shall be free to render similar services to others. 3. The Adviser is authorized to select the brokers and dealers that will execute the purchases and sales of portfolio securities for the Fund and is directed to use its best -2- efforts to obtain the best available price and execution, except as prescribed herein. Unless and until otherwise directed by the Board of Directors of the Fund, the Adviser may also effect individual securities transactions at commission rates in excess of the minimum commission rates available, if the Adviser determines in good faith that such amount of commission is reasonable in relation to the value of the brokerage or research services provided by such broker or dealer, viewed in terms of either that particular transaction or the Adviser's overall responsibilities with respect to the Fund. The execution of such transactions shall not be deemed to represent an unlawful act or breach of any duty created by this Agreement or otherwise. 4. The Fund has delivered copies of each of the following documents to the Adviser and will promptly notify and deliver to it all future amendments and supplements, if any: (a) Articles of Incorporation of the Fund, filed with the Department of Assessments and Taxation of the State of Maryland on February 11, 1987 (such Articles of Incorporation, as presently in effect and as amended from time to time, being herein called the "Articles of Incorporation"); (b) Bylaws of the Fund (such Bylaws, as presently in effect and as amended from time to time, being herein called the "Bylaws"); (c) Certified resolutions of the Board of Directors of the Fund authorizing the appointment of the Adviser and approving the form of this Agreement; (d) Registration Statement under the 1940 Act and the Securities Act of 1933, as amended, on Form N-2 (No. 33-10851) (the "Registration Statement") as filed with the Securities and Exchange Commission (the "Commission") on September 27, 1996 relating to the Fund and the Fund Shares, and all amendments thereto; (e) Notification of Registration of the Fund under the 1940 Act on Form N-8A as filed with the Commission on February 13, 1987 and all amendments thereto; and (f) Prospectus of the Fund dated September 27, 1996 (such prospectus being herein called the "Prospectus"). 5. The Adviser shall authorize and permit any of its partners, agents and employees who may be elected as directors or officers of the Fund to serve in the capacities in which they are elected. Services to be furnished by the Adviser under this Agreement may be furnished through the medium of any of such partners, agents or employees of the Adviser. 6. The Adviser shall keep the Fund's books and records required to be maintained by it pursuant to paragraph 2(e) of this Agreement. The Adviser agrees that all records which it maintains for the Fund are the property of the Fund and it will promptly surrender any of such records to the Fund upon the Fund's request. The Adviser further agrees to preserve for the periods prescribed by Rule 31a-2 of the Commission under the 1940 Act any such records as are required to be maintained by the Adviser with respect to the Fund by Rule -3- 31a-1 of the Commission under the 1940 Act. 7. During the term of this Agreement the Adviser will pay all expenses (including without limitation the compensation of all its partners, agents and employees serving as directors or officers of the Fund pursuant to paragraph 5 of this Agreement) incurred by it in connection with its activities under this Agreement other than the cost of securities and investments purchased for the Fund (including taxes and brokerage commissions, if any). 8. For the services provided and the expenses borne pursuant to this Agreement, the Fund will pay to the Adviser as full compensation therefor a fee, computed weekly and payable quarterly, at an annual rate equal to 0.50% per annum of the average weekly net assets of the Fund. This fee for each quarter will be paid to the Adviser during the month succeeding such quarter. 9. The Adviser shall not be liable for any error of judgment or mistake of law or for any loss suffered by the Fund in connection with the matters to which this Agreement relates, except a loss resulting from a breach of fiduciary duty with respect to the receipt of compensation for services (in which case any award of damages shall be limited to the period and the amount set forth in Section 36(b)(3) of the 1940 Act) or a loss resulting from willful misfeasance, bad faith or gross negligence on its part in the performance of its duties or from reckless disregard by it of its obligations and duties under this Agreement. 10. This Agreement shall become effective on the date hereof. Upon becoming effective, this Agreement shall remain in effect for an initial two-year term and shall continue in effect from year to year thereafter if such continuance is approved at least annually by (a) a majority of the outstanding voting securities (as defined in the 1940 Act) or by vote of the Fund's Board of Directors, cast in person at a meeting called for the purpose of voting on such approval, and (b) vote of a majority of the Directors of the Fund who are not parties to this Agreement or "interested persons" (as defined in the 1940 Act) of any party to this Agreement, cast in person at a meeting called for the purpose of voting on such approval. This Agreement may be terminated by the Fund at any time, without the payment of any penalty, by the Board of Directors of the Fund or by vote of a majority of the outstanding voting securities (as defined in the 1940 Act) of the Fund on 60 days' written notice to the Adviser, or by the Adviser at any time, without the payment of any penalty, on 90 days' written notice to the Fund. This Agreement will automatically and immediately terminate in the event of its assignment (as defined in the 1940 Act). 11. The Adviser shall for all purposes herein be deemed to be an independent contractor and shall, unless otherwise expressly provided herein or authorized by the Board of Directors of the Fund from time to time, have no authority to act for or represent the Fund in any way or otherwise be deemed an agent of the Fund. 12. This Agreement may be amended by mutual consent, but the consent of the Fund must be approved (a) by vote of a majority of those Directors of the Fund who are not parties to this Agreement or "interested persons" (as defined in the 1940 Act) of any such party, -4- cast in person at a meeting called for the purpose of voting on such amendment, and (b) by vote of a majority of the outstanding voting securities (as defined in the 1940 Act) of the Fund. 13. Notices of any kind to be given to the Adviser by the Fund shall be in writing and shall be duly given if mailed or delivered to the Adviser at 466 Lexington Avenue, 16th Floor, New York, New York 10017, Attention: Chief Executive Officer, with a copy to: General Counsel or at such other address or to such other individual as shall be specified by the Adviser to the Fund in accordance with this paragraph 13. Notices of any kind to be given to the Fund by the Adviser shall be in writing and shall be duly given if mailed or delivered to the Fund at Credit Suisse Asset Management Income Fund, Inc., 466 Lexington Avenue, 16th Floor, New York, New York 10017, Attention: Chairman, with a copy to: Senior Vice President or at such other address or to such other individual as shall be specified by the Fund to the Adviser in accordance with this paragraph 13. The Adviser agrees to notify the Fund of any change in its membership within a reasonable time of such change. 14. The Fund agrees that if this Agreement is terminated and the Adviser shall no longer be the adviser to the Fund, the Fund will, within a reasonable period of time, change its name to delete reference to "Credit Suisse Asset Management". 15. This Agreement shall be governed by and construed in accordance with the laws of the State of New York. 16. This Agreement may be executed in one or more counterparts, each of which shall be deemed to be an original. -5- IN WITNESS WHEREOF, the parties hereto have caused this instrument to be executed by their officers designated below as of the day and year first above written. CREDIT SUISSE ASSET MANAGEMENT INCOME FUND, INC. By: /s/ Michael Pignataro --------------------------------------------- Name: Michael Pignataro Title: Secretary CREDIT SUISSE ASSET MANAGEMENT, LLC By: --------------------------------------------- Name: Hal Liebes Title: Managing Director -6- APPENDIX A CORPORATE BOND RATINGS Moody's Investors Service's Corporate Bond Ratings Aaa -- Bonds which are rated Aaa are judged to be of the best quality. They carry the smallest degree of investment risk and are generally referred to as "gilt edged". Interest payments are protected by a large or by an exceptionally stable margin and principal is secure. While the various protective elements are likely to change, such changes as can be visualized are most unlikely to impair the fundamentally strong position of such issues. Aa -- Bonds which are rated Aa are judged to be of high quality by all standards. Together with the Aaa group they comprise what are generally known as high-grade bonds. They are rated lower than the best bonds because margins of protection may not be as large as in Aaa securities or fluctuation of protective elements may be of greater amplitude or there may be other elements present which make the long-term risks appear somewhat larger than the Aaa securities. A -- Bonds which are rated A possess many favorable investment attributes and are to be considered as upper medium grade obligations. Factors giving security to principal and interest are considered adequate, but elements may be present which suggest a susceptibility to impairment sometime in the future. Baa -- Bonds which are rated Baa are considered as medium-grade obligations, (i.e., they are neither highly protected nor poorly secured.) Interest payments and principal security appear adequate for the present but certain protective elements may be lacking or may be characteristically unreliable over any great length of time. Such bonds lack outstanding investment characteristics and in fact have speculative characteristics as well. Ba -- Bonds which are rated Ba are judged to have speculative elements; their future cannot be considered as well-assured. Often the protection of interest and principal payments may be very moderate, and thereby not well safeguarded during both good and bad times over the future. Uncertainty of position characterize bonds in this class. B -- Bonds which are rated B generally lack characteristics of the desirable investment. Assurance of interest and principal payments or of maintenance of other terms of the contract over any long period of time may be small. Caa -- Bonds which are rated Caa are of poor standing. Such issues may be in default or there may be present elements of danger with respect to principal or interest. Ca -- Bonds which are rated Ca represent obligations which are speculative in a high degree. Such issues are often in default or have other marked shortcomings. C -- Bonds which are rated C are the lowest rated class of bonds, and issues so rated can be regarded as having extremely poor prospects of ever attaining any real investment standing. Note: Moody's applies numerical modifiers "1", "2" and "3" in each generic rating classification from Aaa through B in its corporate bond rating system. The modifier "1" indicates that the security ranks in the higher end of its generic rating category: the modifier "2" indicates a mid-range ranking; and the modifier "3" indicates that the issue ranks in the lower end of its generic rating category. Standard & Poor's Corporate and Municipal Bond Ratings AAA -- An obligation rated AAA has the highest rating assigned by Standard & Poor's. The obligor's capacity to meet its financial commitment on the obligation is extremely strong. AA -- An obligation rated AA differs from the highest-rated obligations only in a small degree. The obligor's capacity to meet its financial commitment on the obligation is very strong. A -- An obligation rated A is somewhat more susceptible to the adverse effects of changes in circumstances and economic conditions than obligations in higher rated categories. However, the obligor's capacity to meet its financial commitment on the obligation is still strong. BBB -- An obligation rated BBB exhibits adequate protection parameters. However, adverse economic conditions or changing circumstances are more likely to lead to a weakened capacity to meet its financial commitment on the obligation. Obligations rated BB, B, CCC and CC and C are regarded as having significant speculative characteristics. BB indicates the lowest degree of speculation and C the highest. While such bonds will likely have some quality and protective characteristics, these may be outweighed by large uncertainties or major exposures to adverse conditions. BB - An obligation rated BB is less vulnerable to nonpayment than other speculative issues. However, it faces major ongoing uncertainties or exposure to adverse business, financial, or economic conditions, which could lead to the obligor's inadequate capacity to meet its financial commitment on the obligation. B - An obligation rated B is more vulnerable to nonpayment than obligations rated BB, but the obligor currently has the capacity to meet its financial commitment on the obligation. Adverse business, financial, or economic conditions will likely impair the obligor's capacity or willingness to meet its financial commitment on the obligation. CCC - An obligation rated CCC is currently vulnerable to nonpayment and is dependent upon favorable business, financial and economic conditions for the obligor to meet its financial commitment on the obligation. In the event of adverse business, financial or economic conditions, the obligor is not likely to have the capacity to meet its financial commitment on the obligation. CC - An obligation rated CC is currently highly vulnerable to nonpayment. C -- The C rating may be used to cover a situation where a bankruptcy petition has been filed or similar action has been taken, but payments on this obligation are being continued. D -- An obligation rated D is in payment default. The D rating category is used when payments on an obligation are not made on the date due even if the applicable grace period has not expired, unless Standard & Poor's believes that such payments will be made during such grace period. The D rating also will be used upon the filing of a bankruptcy petition or the taking of a similar action if payments on an obligation are jeopardized. Plus (+) or minus (-) -- The ratings from AA to CCC may be modified by the addition of a plus or minus sign to show relative standing within the major rating categories. r -- This symbol is attached to the ratings of instruments with significant noncredit risks. It highlights risks to principal or volatility of expected returns which are not addressed in the credit rating. Examples include: obligations linked or indexed to equities, currencies, or commodities; obligations exposed to severe prepayment risk -- such as interest-only or principal-only mortgage securities; and obligations with unusually risky interest terms, such as inverse floaters. APPENDIX B AUDIT COMMITTEE CHARTER CSAM CLOSED-END FUNDS Organization The members of the Audit Committee of the Board of Directors ("Directors") of each CSAM-advised closed-end registered investment company (each a "Fund" and together, the "Funds") are selected by the full Board of Directors of the relevant Fund. The members of the Audit Committee shall consist of not less than three persons (except as otherwise provided below), all of whom are not "interested persons" (as defined in Section 2(a)(19) of the Investment Company Act of 1940, as amended) of the Fund and who are "independent" within the meaning of the audit committee rules of any securities exchange on which the Fund's shares are listed for trading. Each member of the Audit Committee shall be financially literate, as such qualification is interpreted by the Board of Directors in its business judgment, or must become financially literate within a reasonable period of time after his or her appointment to the Audit Committee. At least one member of the Audit Committee must have accounting or related financial management expertise, as the Board of Directors interprets such qualification in its business judgment. Any Fund that currently has less than three members on its Audit Committee must have three members not later than June 14, 2001. Thereafter, if the number of members on a Fund's Audit Committee falls below three, such Fund shall fill any vacancies within 90 days. Statement of Policy Each Fund's Audit Committee oversees the financial reporting process for that Fund. A Fund's Board and its Audit Committee recognize that they are the shareholders' representatives, that the auditors are ultimately accountable to the Board of Directors and the Audit Committee and that the Board of Directors and the Audit Committee have the authority and responsibility to select, evaluate and, where appropriate, recommend to shareholders the selection or replacement of the outside auditors. Each Fund's Audit Committee shall monitor the process for the Funds' valuation of portfolio assets. This is key to providing shareholders and regulators adequate, meaningful information for decision making. Members of each Fund's Audit Committee must have a general understanding regarding the accounting process and the control structure in place for each Fund. Open communication with management and the independent auditors is essential. This Charter shall be reviewed annually by the Board of each Fund. Responsibilities of the Audit Committee In order to provide reasonable flexibility, the following listed Committee responsibilities are described in broad terms: o The Audit Committee's role is clearly one of oversight and review and not of direct management of the audit process. Each Fund's Board and Audit Committee recognize that the outside auditors are ultimately accountable to the Board and the Audit Committee. o The Audit Committee members are responsible for a general understanding of the subject Fund's accounting systems and controls. o Committee members shall periodically evaluate the independent audit firm's performance and the costs of its services. The Audit Committee will make recommendations to the full Board of Directors regarding the selection of the independent audit firm. The Committee shall request from the independent auditors periodically a formal written statement (1) delineating all relationships between the auditors and the Fund, its investment adviser and their corporate affiliates and including disclosures regarding the auditors' independence required by Independence Standards Board Standard No. 1, as may be modified or supplemented, and (2) certifying that, in the view of the auditors, they are independent public accountants with respect to the Fund within the meaning of the Securities Act of 1933, as amended, and the applicable rules and regulations thereunder. The Audit Committee is responsible for actively engaging in a dialogue with the auditors with respect to any disclosed relationships or services that may impact the objectivity and independence of the auditors, and for recommending that the full Board take appropriate steps, if any, in response to the auditors' response to satisfy itself of the independence of the auditors. o Each Fund's Audit Committee is responsible for reviewing the scope of the audit proposed by the Fund's independent auditors. o Each Fund's Audit Committee is responsible for recording minutes of its meetings and reporting significant matters to the full Board of Directors. The Audit Committee shall meet no less frequently than annually and receive information (as necessary) from, among others, the general counsel of Credit Suisse Asset Management, LLC and Fund counsel, in addition to the auditors, in order to be informed about legal and accounting issues having the possibility of impacting the financial reporting process. This would include items of industry-wide importance and internal issues such as litigation. o Each Fund's Audit Committee is responsible for (i) reviewing and discussing with management and the auditors the Fund's audited financial statements; and (ii) discussing with the auditors the matters required to be discussed by Statement on Auditing Standards No. 61, as may be modified or supplemented. The Audit Committee shall confirm that the independent auditors are satisfied with the disclosure and content of the Fund's audited financial statements and shall advise the Board of Directors with respect to its recommendation as to the inclusion of the Fund's audited financial statements in its Annual Report to Shareholders. o In reviewing the activities of the independent auditors, each Fund's Audit Committee shall consider the auditors' comments with respect to the appropriateness and adequacy of the Fund's accounting policies, procedures and principles. o The Audit Committee should take appropriate steps to keep apprised of regulatory changes and new accounting pronouncements that affect net asset value calculations and financial statement reporting requirements. o The Audit Committee of each Fund shall review and reassess the adequacy of this Charter on an annual basis. PROXY CARD FOR CREDIT SUISSE ASSET MANAGEMENT INCOME FUND, INC. CREDIT SUISSE ASSET MANAGEMENT INCOME FUND, INC. PROXY P R O X Y This Proxy is Solicited on Behalf of the Board of Directors The undersigned hereby appoints Messrs. Hal Liebes and Michael A. Pignataro as Proxies, each with the power to appoint his substitute, and hereby authorizes them severally to represent and to vote, as designated on the reverse side and in accordance with their judgment on such other matters as may properly come before the meeting or any adjournments or postponements thereof, all shares of Credit Suisse Asset Management Income Fund, Inc. (the "Fund") that the undersigned is entitled to vote at the annual meeting of shareholders to be held on Tuesday, May 1, 2001, and at any adjournments or postponements thereof. PLEASE MARK, SIGN, DATE AND RETURN THIS PROXY CARD PROMPTLY USING THE ENCLOSED ENVELOPE. [Internet address to be added] - ---------------- ---------------- SEE REVERSE SIDE CONTINUED AND TO BE SIGNED ON REVERSE SIDE SEE REVERSE SIDE - ---------------- ---------------- |X| Please mark votes as in this example The Board of Directors recommends a vote "FOR" Proposal 1, "FOR" Proposal 2, and "FOR" the nominees in Proposal 3. If no direction is made, this proxy will be voted in favor of the Fund's nominees for election as Directors and for Proposals 1 and 2. 1. To approve the Agreement and Plan of Reorganization dated as of ____, 2001 between Credit Suisse Asset Management Strategic Global Income Fund, Inc ("CGF") and the Fund whereby (i) the Fund would acquire all the assets and liabilities of CGF, (ii) the Fund would issue Fund shares to CGF in exchange therefor, (iii) such Fund shares would be distributed to shareholders of CGF in liquidation of CGF, and (iv) CGF would subsequently be dissolved under Maryland law and de-registered under the Investment Company Act of 1940. FOR AGAINST ABSTAIN |_| |_| |_| 2. To approve a new investment advisory agreement with Credit Suisse Asset Management, LLC. FOR AGAINST ABSTAIN |_| |_| |_| 3. Election of the following nominees as Directors: Nominees: Enrique R.Arzac Lawrence J. Fox James S. Pasman William W. Priest, Jr. James P. McCaughan FOR ALL NOMINEES LISTED ABOVE (except as marked to the contrary above) |_| |_| WITHHOLD AUTHORITY TO VOTE FOR ALL NOMINEES LISTED ABOVE (Instruction: To withhold authority for any individual nominee, strike a line through such individual's name above.) shareholder MARK HERE FOR ADDRESS CHANGE AND NOTE AT LEFT |_| This proxy when properly executed will be voted in the manner directed herein by the undersigned shareholder. 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: -------------------------------- ------------------------- PROXY CARD FOR CREDIT SUISSE ASSET MANAGEMENT STRATEGIC GLOBAL INCOME FUND, INC. CREDIT SUISSE ASSET MANAGEMENT STRATEGIC GLOBAL INCOME FUND, INC. PROXY This Proxy is Solicited on Behalf of the Board of Directors P R O X Y The undersigned hereby appoints Messrs. Hal Liebes and Michael A. Pignataro as Proxies, each with the power to appoint his substitute, and hereby authorizes them severally to represent and to vote, as designated on the reverse side and in accordance with their judgment on such other matters as may properly come before the meeting or any adjournments or postponements thereof, all shares of Credit Suisse Asset Management Strategic Global Income Fund, Inc. (the "Fund") that the undersigned is entitled to vote at the special meeting of shareholders to be held on Tuesday, May 1, 2001, and at any adjournments or postponements thereof. PLEASE MARK, SIGN, DATE AND RETURN THIS PROXY CARD PROMPTLY USING THE ENCLOSED ENVELOPE. [Internet address to be added] - ---------------- ---------------- SEE REVERSE SIDE CONTINUED AND TO BE SIGNED ON REVERSE SIDE SEE REVERSE SIDE - ---------------- ---------------- |X| Please mark votes as in this example The Board of Directors recommends a vote "FOR" Proposal 1. If no direction is made, this proxy will be voted for Proposal 1. 1. To approve the Agreement and Plan of Reorganization dated as of ____, 2001 between the Fund and Credit Suisse Asset Management Income Fund, Inc. ("CGF") whereby (i) the Fund would acquire all the assets and liabilities of CGF, (ii) the Fund would issue Fund shares to CGF in exchange therefor, (iii) such Fund shares would be distributed to shareholders of CGF in liquidation of CGF, and (iv) CGF would subsequently be dissolved under Maryland law and de-registered under the Investment Company Act od 1940. FOR AGAINST ABSTAIN |_| |_| |_| MARK HERE FOR ADDRESS CHANGE AND NOTE AT LEFT |_| This proxy when properly executed will be voted in the manner directed herein by the undersigned shareholder 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: -------------------- The Information in this Statement of Additional Information is not complete and may be changed. We may not issue these securities until the registration statement filed with the Securities and Exchange Commission of which this Statement of Additional Information forms a part is effective. This Statement of Additional Information is not an offer to sell these securities and is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted. PART B CREDIT SUISSE ASSET MANAGEMENT INCOME FUND, INC. CREDIT SUISSE ASSET MANAGEMENT STRATEGIC GLOBAL INCOME FUND, INC. STATEMENT OF ADDITIONAL INFORMATION ACQUISITION OF THE ASSETS OF CREDIT SUISSE ASSET MANAGEMENT STRATEGIC GLOBAL INCOME FUND, INC. 466 LEXINGTON AVENUE, 16th FLOOR NEW YORK, NY 10017 (212) 875-3500 By and In Exchange for Shares of CREDIT SUISSE ASSET MANAGEMENT INCOME FUND, INC. 466 LEXINGTON AVENUE, 16th FLOOR NEW YORK, NY 10017 (212) 875-3500 This Statement of Additional Information, or SAI, relates specifically to the proposed reorganization (the "Reorganization") of Credit Suisse Asset Management Strategic Global Income Fund, Inc. into Credit Suisse Asset Management Income Fund, Inc. in accordance with the General Corporation Law of the State of Maryland. Credit Suisse Asset Management Strategic Global Income Fund is sometimes referred to in this SAI as "CGF," Credit Suisse Asset Management Income Fund is sometimes referred to in this SAI as "CIK" or, following consummation of the Reorganization, as the "Surviving Fund," and CGF and CIK are sometimes collectively referred to as the "Funds" and individually, as the context may require, as the "Fund." This Statement of Additional Information consists of this cover page, the information contained herein, and the following documents, each of which has been filed electronically and is incorporated by reference herein: o The audited financial statements, notes to the audited financial statements and report of the independent public accountants for CGF for the fiscal year ended December 31, 2000 included in that Fund's Annual Report to Shareholders; and o The audited financial statements, notes to the audited financial statements and report of the independent public accountants for CIK for the fiscal year ended December 31, 2000 included in that Fund's Annual Report to Shareholders. This Statement of Additional Information is not a prospectus and should be read only in conjunction with the Proxy Statement/Prospectus dated ____________, relating to the Reorganization. This Statement of Additional Information does not include all information that you should consider before investing in either Fund, and you should obtain and read the Proxy Statement/Prospectus prior to doing so. A copy of the Proxy Statement/Prospectus may be obtained without charge by writing to Georgeson Shareholder Communications at 17 State Street, 16th Floor, New York, New York 10004 or by calling 1-(800) 223-2064. The Proxy Statement/Prospectus and this Statement of Additional Information omit certain of the information contained in the registration statement filed with the Securities and Exchange Commission, Washington, D.C. You may obtain the registration statement from the Securities and Exchange Commission upon payment of the fee prescribed, or inspect it at the Securities and Exchange Commission's office at no charge. This Statement of Additional Information is dated _______. TABLE OF CONTENTS COMPARISON OF INVESTMENT OBJECTIVES AND POLICIES.............................1 INVESTMENT RESTRICTIONS.....................................................10 MANAGEMENT OF THE FUNDS.....................................................13 PORTFOLIO TRANSACTIONS......................................................15 DIVIDEND REINVESTMENT AND CASH PURCHASE PLAN................................16 TAXATION....................................................................22 FINANCIAL STATEMENTS........................................................29 PRO FORMA FINANCIAL STATEMENTS..............................................29 GENERAL INFORMATION CIK changed its name from CS First Boston Income Fund, Inc. to BEA Income Fund, Inc. in August 1995 and to Credit Suisse Asset Management Income Fund, Inc. in May 1999. CGF changed its name from CS First Boston Strategic Income Fund, Inc. to BEA Strategic Income Fund, Inc. in August 1995, to BEA Strategic Global Income Fund, Inc. in June of 1997, and to Credit Suisse Asset Management Strategic Global Income Fund, Inc. in May 1999. COMPARISON OF INVESTMENT OBJECTIVES AND POLICIES Organization CGF and CIK are both closed-end, diversified management investment companies registered under the Investment Company Act. Both Funds are organized as corporations under the laws of the State of Maryland. Each Fund is managed and advised by CSAM. The shares of common stock of each Fund are listed and trade on the NYSE. After the Reorganization, CGF's shares will be delisted and CGF be liquidated. The shares of common stock of each Fund have equal non-cumulative voting rights and equal rights with respect to dividends, assets and dissolution. Each Fund's shares of common stock are fully paid and non-assessable and have no preemptive, conversion or other subscription rights. Fluctuations in the market price of the Fund's shares is the principal investment risk of an investment in either Fund. Portfolio management, market conditions, investment policies and other factors affect such fluctuations. Although currently the investment objectives, policies and restrictions of the Funds are similar, there are differences between them, as discussed below. There can be no assurance that either Fund will achieve its stated objective. Investment Objectives The investment objective of CGF is high current income consistent with the preservation of capital. CGF seeks to achieve this objective by investing in higher yielding U.S. and foreign fixed-income securities, with an emphasis on U.S. high yield (junk bonds) and emerging market securities. CIK's investment objective is current income consistent with the preservation of capital. CIK seeks to achieve this objective by investing primarily in fixed-income securities, such as bonds, debentures and preferred stocks. CIK's investment portfolio is not managed for capital appreciation. No assurance can be given that the investment objective of either Fund will be achieved. Investment Policies CGF must invest at least 65% of its total assets in income-producing securities. CSAM expects that substantially all of CGF's assets will be invested in income-producing securities. Under normal circumstances, CIK invests at least 75% of its assets in fixed-income securities. CGF may invest up to 35% of its net assets in the securities of issuers located in the emerging markets. In February 2001, the Board of Directors of CIK adopted this non-fundamental investment policy after determining that it could enhance CIK's ability to achieve its investment objective. Neither Funds' investments are subject to a rating quality limitation. Accordingly, each may invest a substantial portion of its assets in securities rated below investment grade by a nationally recognized rating service or unrated but in CSAM's opinion of comparable quality. Investment Portfolios CIK historically has pursued its investment objective by investing principally in high yield fixed income securities of domestic issuers, while investing a relatively small percentage of its net assets in investment-grade debt securities (approximately 15% before the recent portfolio repositioning). CGF has pursued its investment objective by investing not less than 65% of its net assets in domestic high yield securities, and up to 35% of its net assets in emerging markets debt. In February 2001, the Board of Directors of CIK adopted a policy with respect to investments in emerging market debt similar to that of CGF and accepted a recommendation from the investment advisor to partially reposition its portfolio. As a result, CIK has liquidated its investment-grade debt securities portfolio and re-deployed those assets (up to 15% of the Fund's net assets) in emerging market debt securities. In addition, following a recommendation by the investment advisor, CGF has reduced the percentage of its net assets invested in emerging markets debt to 15% from approximately 35%. As a result of these changes, the Funds have a substantially similar investment mix: approximately 85% of their respective nets assets is invested in U.S. high yield fixed-income securities and 15% is invested in fixed-income securities of issuers located in the emerging markets. The decision to reposition CIK's portfolio was based on a number of considerations, including CSAM's advice to the CIK Board that: o during the last several years emerging markets debt has matured considerably as a separate asset class, o emerging markets debt is generally not highly correlated with domestic high yield debt and thus under current market conditions should result in a less volatile portfolio than one investing solely in domestic high yield securities, and o the repositioning should enhance the overall yield on CIK's portfolio, and thus enable the Board to give consideration to an increase in CIK's dividend rate at some point in the future. The decision to increase CGF's exposure to U.S. high yield fixed-income securities was based on CSAM's advice to the CGF Board that the spreads over investment grade debt afforded by emerging market debt have narrowed, while at present comparable spreads for domestic high yield fixed income securities have remained high. For a more detailed description of each Fund's investment portfolio, see "Proposal 1 (Both Funds): Approval of the Agreement and Plan of Reorganization pursuant to which CIK Will Acquire All the Assets and Liabilities of CGF -- Comparison of Investment Objectives and Policies" in the Proxy Statement/Prospectus. Investment Techniques U.S. Fixed-Income Securities High Yield Fixed-Income Securities. The Funds invest primarily in higher yielding, lower rated U.S. corporate fixed income securities, including debt securities, convertible securities and preferred stocks. They may also invest in securities rated single A or higher by Moody's or by Standard & Poor's and unrated corporate fixed-income securities when CSAM determines that such securities are offering high yields in relation to risk due to current market or other conditions. CIK historically invested a small percentage of its net assets in investment-grade rated debt securities (approximately _% of net assets in -2- average for the past _ years and _% as of December 31, 2000). CGF has focused almost exclusively on below-investment grade debt securities. CSAM expects that the Surviving Fund will continue this focus for the foreseeable future. Differing yields on fixed-income securities of the same maturity are a function of several factors, including the relative financial strength of the issuers. Higher yields are generally available from securities in the lower categories of recognized rating agencies, i.e., Baa or lower by Moody's or BBB or lower by Standard & Poor's. The Funds may invest in any security which is rated by Moody's or by Standard & Poor's or in any unrated security which CSAM determines is of suitable quality. However, substantially all of the securities in which the Funds invest will be in the lower-rated categories. Lower-rated securities generally provide yields superior to those of more highly-rated securities, but involve greater risks and are speculative in nature. Securities in the rating categories below Baa as determined by Moody's and BBB as determined by Standard & Poor's are considered to be of poor standing and predominantly speculative. The rating services' descriptions of these rating categories, including the speculating characteristics of the lower categories, are set forth in Appendix A to the Proxy Statement/Prospectus. Securities ratings are based largely on the issuer's historical financial information and the rating agencies' investment analysis at the time of rating. Consequently, the rating assigned to any particular security is not necessarily a reflection of the issuer's current financial condition, which may be better or worse than the rating would indicate. Although CSAM considers security ratings when making investment decisions for high yield securities, it performs its own investment analysis and does not rely principally on the ratings assigned by the rating services. CSAM's analysis may include consideration of the issuer's experience and managerial strength, changing financial condition, borrowing requirements or debt maturity schedules, and its responsiveness to changes in business conditions and interest rates. It also considers relative values based on anticipated cash flow, interest or dividend coverage, asset coverage and earnings prospects. CSAM bases its investment decisions in high yield securities on the results of issuer and security-specific credit analysis. CSAM evaluates each issuer's rating, cash flow, financial structure and business risk. CSAM takes into account, among other things, the issuer's financial resources, its sensitivity to economic conditions and trends, its operating history, the quality of the issuer's management and regulatory matters. CSAM evaluates the covenants of each security and pursues a strategy of broad issuer and industry diversification. U.S. Government Fixed-Income Securities. The Funds may invest in U.S. government securities and may engage in options, futures contracts and repurchase transactions with respect to such securities. U.S. government securities refers to debt securities issued or guaranteed by the U.S. government, by various of its agencies, or by various instrumentalities established or sponsored by the U.S. government. These securities may or may not be supported by the full faith and credit of the United States. Depending on market conditions, the Funds may invest a substantial portion of their assets in mortgage-backed securities. Mortgage-backed securities are collateralized by mortgages or interests in mortgages and may be issued by government or non-government entities. Mortgage-backed securities issued by government entities typically provide a monthly payment consisting of interest and principal payments, and additional payments will be made out of unscheduled payments of principal. Non-government issued mortgage-backed securities may offer higher yields than those issued by government entities, but may be subject to greater price fluctuations. Mortgage securities that are government securities include the securities of GNMA, Federal Home Loan Mortgage Corporation ("FHLMC"), and Federal National Mortgage Association ("FNMA"). -3- Each of these agencies issue mortgage pass-through securities. Pass-through securities are bonds backed by pools of mortgages. These securities include mortgage pass-through Certificates, collateralized mortgage obligations, including real estate investment conduits as authorized under the Internal Revenue Code of 1986, as amended ("CMO's"), and mortgage-backed bonds. Mortgage-related securities may also be issued by financial institutions such as commercial banks, savings and loan associations, mortgage bankers and securities broker-dealers (or separate trusts or affiliates of such institutions established to issue the securities), with the underlying securities being U.S. Government securities or non-U.S. government issued securities. Mortgage-related securities issued by financial institutions (or separate trusts or affiliates of such institutions), even where backed by U.S. Government securities, are not considered U.S. Government securities and have a different set of risks and features. Interests in pools of mortgage-related securities differ from other forms of debt securities, which normally provide for periodic payment of interest in fixed amounts and principal payments at maturity or specified call dates. Instead, mortgage-related securities provide a "pass-through" of monthly payments of interest and principal made by the borrowers on their residential mortgage loans, net of any fees paid to the issuer or guarantor of such securities. Additional payments are caused by repayments of principal resulting from the sale of the underlying residential property, refinancing or foreclosure, net of fees or costs which may be incurred. Some mortgage-related securities (such as securities issued by GNMA) are described as "modified pass-through." These securities entitle the holder to receive timely payment of all interest and principal payments owed on the mortgages in the pool, net of certain fees, regardless of whether or not the mortgagors actually make the payments. A CMO series is made up of a group of bonds that together are fully collateralized directly or indirectly by a pool of mortgages on which the payments of principal and interest are dedicated to payment of principal and interest on the bonds in the series. Each class of bonds in the series may have a different maturity than the other classes of bonds in the series, bear a different coupon and have a different priority in receiving payments. The different maturities come from the fact that all principal payments, both regular principal payments as well as any prepayment of principal, are passed through first to the holders of the class with the shortest maturity until it is completely retired. Thereafter, principal payments are passed through to the next class of bonds in the series, until all the classes have been paid off. As a result, an acceleration in the rate of prepayments that may be associated with declining interest rates shortens the expected life of each class, with the greatest impact on those classes with the shortest maturities. Similarly, should the rate of prepayments slow down, as may happen in times of rising interest rates, the expected life of each class lengthens, again with the greatest impact on those classes with the shortest maturities. In the case of some CMO series, each class may receive a differing proportion of the monthly interest and principal repayments on the underlying collateral. In these series, the classes having proportionally greater interests in principal repayments generally would be more affected by an acceleration (or slowing) in the rate of prepayments. Mortgage-backed bonds are general obligations of the issuer fully collateralized directly or indirectly by a pool of mortgages. The mortgages serve as collateral for the issuer's payment obligations on the bonds, but interest and principal payments on the mortgages are not passed through either directly (as with mortgage pass-through certificates) or on a modified basis (as with CMO's). Accordingly, a change in the rate of prepayments on the pool of mortgages could change the effective maturity of a CMO but not that of a mortgage-backed bond (although, like many bonds, mortgage-backed bonds can provide that they are callable by the issuer prior to maturity). To the extent that the Funds invest in the mortgage market, CSAM evaluates relevant economic, environmental and security-specific variables such as housing starts, coupon and age trends. -4- Non U.S. Dollar Denominated Fixed-Income Securities; Fixed-Income Securities of Foreign Issuers CGF invests in debt obligations and other fixed income securities denominated in U.S. dollars, non-U.S. currencies or composite currencies including: o debt obligations issued or guaranteed by foreign national, provincial, state, municipal or other governments with taxing authority or by their agencies or instrumentalities o debt obligations of supranational entities o debt obligations of the U.S. government issued in non-dollar denominated securities o dollar and non-dollar denominated debt obligations and other fixed-income securities of foreign and U.S. corporate issuers Each Fund may invest up to 35% of its net assets in the securities of issuers located in the emerging markets. CIK has a fundamental policy not to invest more than 5% of the value of its total assets in securities denominated in a currency other than the U.S. dollar. As CGF's investments in the securities of issuers located in the emerging markets consist predominantly of U.S. dollar-denominated fixed-income securities, CSAM does not expect that this policy will impair to any material extent CIK's ability to invest in those markets going forward. In making these investments CSAM considers the relative growth and inflation rates of different countries. CSAM considers expected changes in foreign currency exchange rates, including the prospects for central bank intervention, in determining the anticipated returns of securities denominated in foreign currencies. CSAM further evaluates, among other things, foreign yield curves and regulatory and political factors, including the fiscal and monetary policies of such countries. In the past, during periods of falling U.S. exchange rates, yields available from securities denominated in foreign currencies have often been higher, in U.S. dollar terms, than those of securities denominated in U.S. dollars. CSAM considers expected changes in foreign currency exchange rates in determining the anticipated returns of securities denominated in foreign currencies. The obligations of foreign governmental entities, including supranational issuers, have various kinds of government support. Obligations of foreign governmental entities include obligations issued or guaranteed by national, provincial, state or other governments with taxing power or by their agencies. These obligations may or may not be supported by the full faith and credit of a foreign government. Other Investment Techniques To enhance return as market opportunities arise, the Funds may use the following investment techniques. Repurchase Agreements The Funds may invest in repurchase agreements collateralized by U.S. government securities, certificates of deposit and certain bankers' acceptances for the purpose of realizing additional income. Repurchase agreements are transactions by which the Funds purchase a security and simultaneously commits to resell that security to the seller (a bank or securities dealer) at an agreed upon price on an -5- agreed upon date (usually within seven days of purchase). The resale price reflects the purchase price plus an agreed-upon market rate of interest that is unrelated to the coupon rate or date of maturity of the purchased security. Use of repurchase agreements can permit the Funds to keep their assets at work while retaining short-term flexibility in pursuit of investments of a longer-term nature. CSAM will continually monitor the value of the underlying securities to ensure that their value always equals or exceeds the repurchase price. Securities Lending The Funds may lend their portfolio securities to banks, brokers, dealers and other financial institutions who may need to borrow securities in order to complete certain transactions, such as covering short sales, avoiding failures to deliver securities or completing arbitrage operations. By lending their portfolio securities, the Funds attempt to increase their income through the receipt of interest on the loan. Any gain or loss in the market price of the securities lent that might occur during the term of the loan would be for the account of the Funds. The Funds may lend their portfolio securities so long as the terms and the structure of such loans are not inconsistent with the Investment Company Act or the rules and regulations or interpretations of the Securities and Exchange Commission. The Funds will not lend portfolio securities if, as a result, the aggregate of such loans exceeds 33-1/3% of the value of their total assets. Loan arrangements made by the Funds will comply with all other applicable regulatory requirements, including, if applicable, those of the rules of the NYSE. CSAM will consider all relevant facts and circumstances, including the creditworthiness of the borrower, in making decisions about the lending of securities, subject to review by the board of directors of the lending Fund. The creditworthiness of such bank, broker, dealer or other financial institution will be monitored by CSAM during the time any securities are loaned. Voting rights, if any, may pass with the loaned securities. If a material event were to occur affecting an investment on loan, however, the loan must be called and the securities voted by the Fund. Short Sales Each Fund may engage in short sales (the sale of a security that it does not own), but only when it ows an equal amount of such securities or securities convertible into or exchangeable, without payment of further consideration, for securities of the same issue as, and equal in amount to, the securities sold short ("short sales against the box"), and only if not more than 5% of the Fund's net assets is held as collateral for the sales of such Fund at any one time. Options on U.S. Government Securities The Funds may seek to increase their current income by writing covered call or put options with respect to some or all of the U.S. government securities held in their portfolios. In addition, the Funds may at times, through the writing and purchase of options on U.S. government securities, seek to reduce fluctuations in net asset value by hedging against a decline in the value of their U.S. government securities or an increase in the price of securities which the Funds plan to purchase. Significant option writing opportunities generally exist only with respect to longer term U.S. government securities. The Funds may only write covered options, which means that, so long as the Funds are obligated as the writer of a call option, they will own the underlying securities subject to the option (or comparable securities satisfying the cover requirements of securities exchanges). In the case of put options, the Funds will maintain short term U.S. government securities with a value equal to or -6- greater than the exercise price of the underlying securities. The Funds may also write combinations of covered puts and calls on the same security. The Funds receive a premium from writing a put or call option, which increases return on the underlying security in the event the option expires unexercised or is closed out at a profit. The amount of premium reflects, among other things, the relationship of the market price of the underlying security to the exercise price of the option and the remaining term of the option. The Funds may terminate an option that they have written prior to its expiration by entering into a closing purchase transaction in which they purchase an option having the same terms as the option written. The Funds realize a profit or loss from a transaction if the cost of the transaction is less or more than the premium received from writing the option. Because increases in the market price of a call option generally reflect increases in the market price of the underlying security, any loss resulting from the repurchase of a call option may be offset in whole or in part by unrealized appreciation of the underlying security. The Funds may purchase put options on U.S. government securities to protect their portfolio holdings in an underlying security against a substantial decline in market value. Such hedge protection is provided during the life of the put option since the Funds, as holders of the put option, are able to sell the underlying security at the put exercise price regardless of any decline in the underlying security's market price. In order for a put option to be profitable, the market price of the underlying security must decline sufficiently below the exercise price to cover the premium and transaction costs. The Funds may purchase call options on U.S. government securities to hedge against an increase in prices of securities that the Funds ultimately want to buy. Such hedge protection is provided during the life of the call option since the Funds, as holders of the option, are able to buy the underlying security at the exercise price regardless of any increase in such security's market price. In order for a call option to be profitable, the market price of the underlying security must rise sufficiently above the exercise price to cover the premium and transaction costs. Neither Fund will purchase put and call options if as a result more than 5% of the value of its total assets would at the time be invested in such options. Interest Rate Futures and Related Options The Funds may enter into interest rate futures contracts to purchase or sell U.S. government securities or other interest rate-sensitive instruments and options thereon that are traded on U.S. futures exchanges. When the Funds attempt to hedge their portfolio by selling an interest rate futures contract, purchasing a put option thereon, or writing a call option thereon, they will own an amount of U.S. government securities corresponding to the open futures or option position thereby ensuring that the position is unleveraged. The Funds only intend to engage in futures contracts or options for bona fide hedging purposes. In accordance with the current rules of the Commodity Futures Trading Commission, neither Fund will enter into any interest rate futures contract or option thereon if, immediately thereafter, the aggregate initial margin and premiums paid for all existing futures contracts and options thereon not entered into for bona fide hedging purposes would exceed 5% of its total assets. Positions in interest rate futures contracts may be closed out only on the exchange where the contract was made (or on a linked exchange). The Funds intend to purchase or sell interest rate futures contracts only on exchanges, boards of trade or trading facilities where there appears to be an active market for such contracts. Interest rate futures contracts are contracts that obligate the buyer to take and the seller to make delivery at a future date of a specified quantity of the underlying financial instrument. However, some interest rate futures contracts provide for settlement in cash rather than by delivery of the securities underlying the contract. Interest rate futures contracts are currently available on several types of fixed -7- income securities, including U.S. Treasury Bonds, U.S. Treasury Notes and GNMA securities on The Chicago Board of Trade, and on U.S. Treasury Bills on the International Monetary Market Division of The Chicago Mercantile Exchange. A call option for a futures contract gives the purchaser, in return for a premium paid, the right to buy the futures contract underlying the option at a specified exercise price at any time during the term of the option. The writer of the call option, who receives the premium, has the obligation, upon exercise of the option, to deliver the underlying futures contract against payment of the exercise price. A put option for a futures contract gives the purchaser, in return for a premium, the right to sell the underlying futures contract at a specified price during the term of the option. The writer of the put, who receives the premium, has the obligation to buy the underlying futures contract upon demand at the exercise price. In contrast to the purchase or sale of a security, the full purchase price of the futures contract is not paid or received by the Funds upon its purchase or sale. Instead, the Funds will deposit in a segregated custodial account as initial margin an amount of cash or U.S. Treasury bills equal to approximately 5% of the value of the contract. This amount is known as initial margin. The nature of initial margin in futures transactions is different from that of margin in security transactions in that futures contract margin does not involve the borrowing of funds by the customer to finance the transactions. Rather, the initial margin is in the nature of a performance bond or good faith deposit on the contract which is returned to the Funds upon termination of the futures contract assuming all contractual obligations have been satisfied. Subsequent payments to and from the broker, called variation margin, will be made on a daily basis as the price of the underlying security fluctuates, making the long and short positions in the futures contract more or less valuable, a process known as "mark to the market." For example, when the Funds have purchased an interest rate futures contract and the price of the underlying security has risen, that position will have increased in value and the Funds will receive from the broker a variation margin payment equal to that increase in value. Conversely, where the Funds have purchased an interest rate futures contract and the price of the underlying security has declined, the position would be less valuable and the Funds would be required to make a variation margin payment to the broker. At any time prior to expiration of the futures contract, the Funds may elect to terminate the position by taking an opposite position. A final determination of variation margin is then made, additional cash is required to be paid by or released to the Funds, and the Funds realize a loss or gain. No assurance can be given that the Funds will be able to take an opposite position. The purpose of selling an interest rate futures contract is to protect a portfolio from fluctuations in asset value resulting from interest rate changes. Selling a futures contract has an effect similar to selling portfolio securities. If interest rates were to increase, the value of the securities in the portfolio would decline, but the value of the Funds' futures contracts would increase, thereby keeping the net asset value of the Funds from declining as much as it otherwise might have. In this way, selling futures contracts acts as a hedge against the effects of rising interest rates. However, a decline in interest rates resulting in an increase in the value of portfolio securities tends to be offset by a decrease in the value of the corresponding futures contracts. Similarly, when interest rates are expected to decline, futures contracts may be purchased to hedge against anticipated subsequent purchases of portfolio securities at higher prices. By buying futures, the Funds could effectively hedge against an increase in the price of the securities it intends to purchase at a later date in order to permit the purchase to be effected in an orderly manner. At that time, the futures contracts could be liquidated at a profit if rates had in fact declined as expected, and the Funds' cash position could be used to purchase securities. Although most interest rate futures contracts call for making or taking delivery of the underlying securities, these obligations are typically canceled or closed out before the scheduled settlement date. The -8- closing is accomplished by purchasing (or selling) an identical futures contract to offset a short (or long) position. Such an offsetting transaction cancels the contractual obligations established by the original futures transaction. If the price of an offsetting futures transaction varies from the price of the original futures transaction, the Funds will realize a gain or loss corresponding to the difference. That gain or loss will tend to offset the unrealized loss or gain on the hedged securities transaction, but may not always or completely do so. The selection of futures and options strategies requires skills different from those needed to select portfolio securities; however, CSAM does have experience in the use of futures and options. Restricted and Illiquid Securities Each Fund may invest up to 10% of its total assets in securities that are not readily marketable. These include securities which are not registered under the Securities Act and not publicly traded. Restricted and illiquid securities are purchased in placements from the issuer or in the secondary market. The purchase of these securities will depend on their relative attractiveness as compared to securities that have been publicly offered. Restricted and illiquid securities have frequently resulted in higher yields and restrictive covenants providing greater protection for the purchaser, such as longer call or refunding protection, than typically would be available with publicly offered securities of the same type. An issuer is often willing to create more attractive features in its securities issued privately, because it has avoided the expense and delay involved in a public offering of its securities. For various reasons, an issuer may prefer or be required as a practical matter to obtain private financing. At certain times adverse conditions in the public securities markets may preclude a public offering of an issuer's securities. These securities can only be resold to certain categories of purchasers, including qualified institutional buyers, and are usually considered less liquid than publicly-traded securities, which means that the Funds may take longer to liquidate them than would be the case for publicly-traded securities. Foreign Currency Exchange Transactions The Funds may engage in foreign currency exchange transactions to protect against changes in future exchange rates. The Funds will only engage in foreign currency exchange transactions for transaction hedging (in connection with the purchase or sale of portfolio securities) or position hedging (to protect the value of a specific portfolio position). The Funds may engage in U.S. dollar-denominated or non-U.S. dollar denominated hedging. The Funds' ability to engage in hedging and related option transactions may be limited by tax considerations. See "Taxation" below. The Funds may engage in "transaction hedging" to protect against a change in the foreign currency exchange rate between the date on which it contracts to purchase or sell the security and the settlement date, or to "lock in" the U.S. dollar equivalent of a dividend or interest payment in a foreign currency. For that purpose, the Funds may purchase or sell a foreign currency on a spot (or cash) basis at the prevailing spot rate in connection with the settlement of transactions in portfolio securities denominated in that foreign currency. The Funds may also enter into forward currency exchange contracts and purchase exchange-listed and over-the-counter call and put options on foreign currency futures contracts and on foreign currencies. A foreign currency forward contract is a negotiated agreement to exchange currency at a future time at a rate or rates that may be higher or lower than the spot rate. Foreign currency futures contracts are standardized exchange-traded contracts and have margin requirements. -9- For transaction hedging purposes, the Funds may also purchase exchange-listed and over-the-counter call and put options on foreign currency futures contracts and on foreign currencies. A put option on a futures contract gives the Funds the right to assume a short position in the futures contract until expiration of the option. A put option on currency gives the Funds the right to sell a currency at an exercise price until the expiration of the option. A call option on a futures contract gives the Funds the right to assume a long position in the futures contract until the expiration of the option. A call option on currency gives the Funds the right to purchase a currency at the exercise price until the expiration of the option. The Funds may engage in "position hedging" to protect against the decline in the value relative the U.S. dollar of the currencies in which its portfolio securities are denominated or quoted (or an increase in the value of currency for securities which the portfolio intends to buy, when it holds cash reserves and short term investments). For position hedging purposes the Funds may purchase or sell foreign currency futures contracts and foreign currency forward contracts, and may purchase put or call options on foreign currency futures contracts and on foreign currencies on exchanges or over-the-counter markets. In connection with position hedging, the Funds may also purchase or sell foreign currency on a spot basis. Hedging transactions involves costs and may result in losses. The Funds may write covered call options on foreign currencies to offset some of the costs of hedging those currencies. They simply establish a rate of exchange that one can achieve at some future point in time. The Funds engage in over-the-counter transactions only when appropriate exchange-traded transactions are unavailable and when, in the opinion of CSAM, the pricing mechanism and liquidity are satisfactory and the participants are responsible parties likely to meet their contractual obligations. Positions in foreign currency futures contracts may be closed out only on an exchange or board of trade that provides a secondary market in such contracts. The Funds intend to purchase or sell foreign currency futures contracts only on exchanges or boards of trade where there appears to be an active secondary market. The Funds may enter into forward foreign currency exchange contracts (an obligation to purchase or sell a specific currency at a future date) solely for hedging or other appropriate risk management purposes as defined in regulations of the Commodities Futures Trading Commission. The Funds may also write or purchase options on foreign currencies. Such options are purchased or written only when CSAM believes that a liquid secondary market exists for such options. There can be no assurance that a liquid secondary market will exist for a particular option at any specific time. If the Funds sell call options on foreign currencies, they may cover by holding that currency or by holding a separate call option on the currency with a strike price no higher than that of the call option sold. INVESTMENT RESTRICTIONS Each Fund is subject to fundamental investment restrictions that may not be changed without the approval of at least a majority of its outstanding voting securities, as defined in the Investment Company Act. The Investment Company Act defines a "majority" as the lesser of (1) 67% of the shares represented at a meeting of which more than 50% of the outstanding shares are present in person or represented by proxy, or (2) more than 50% of the outstanding shares. Following is a description of each Fund's current fundamental investment restrictions: 1. Neither Fund may invest more than 5% of the value of its total assets in the securities of any one issuer, excluding obligations of the U.S. government or any -10- agency or instrumentality thereof and except that up to 25% of the value of its total assets may be invested without regard to this limitation; 2. Neither Fund may own more than 10% of the outstanding voting stock or other securities (other than securities of the U.S. government or any agency or instrumentality thereof), or both, of any one issuer; 3. Neither Fund may purchase shares of other investment companies except as part of a plan of reorganization, merger, consolidation or an offer of exchange; 4. Neither Fund may borrow money except as a temporary measure for extraordinary or emergency purposes, and in no event in excess of 15% of the value of its total assets, except that for the purpose of this restriction, short-term credits necessary for settlement of securities transactions are not considered borrowings (neither Fund will purchase any securities at any time while such borrowings exceed 5% of total assets); 5. Neither Fund may purchase securities on margin, except that it may make margin payments in connection with transactions in future contracts and related options; 6. Neither Fund may sell securities short unless at all times when a short position is open it owns an equal amount of such securities or securities convertible into or exchangeable, for, without payment of any further consideration, securities of the same issue as, and equal in amount to, the securities sold short, and unless not more than 5% of the value of CIK's net assets or CGF's total assets are held as collateral for such sales at any one time; 7. Neither Fund may purchase or sell commodities or commodity contracts, except that it may write, purchase or sell financial futures contracts and related options, and futures, forward contracts and options on foreign currencies; 8. Neither Fund may invest for the purpose of exercising control over management of any company; 9. Neither Fund may make loans, except (i) by purchasing bonds, debentures or similar obligations (including repurchase agreements, subject to the limitation described in 11 below), which are either publicly distributed or customarily purchased by institutional investors, and (ii) by lending their securities to banks, brokers, dealers and other financial institutions so long as such loans are not inconsistent with the Investment Company Act or the rules and regulations or interpretations of the Securities and Exchange Commission thereunder; 10. Neither Fund may underwrite the securities of other issuers, except to the extent that in connection with the disposition of portfolio securities the Funds may be deemed to be underwriters; 11. Neither Fund may invest more than 10% of the value of its total assets in securities subject to legal or contractual restrictions on resale or in securities which are not readily marketable, including repurchase agreements having maturities of more than 7 days and restricted and illiquid securities; -11- 12. Neither Fund may purchase real estate, although the Funds may purchase or sell securities of companies which deal in real estate or interests therein; 13. Neither Fund may invest directly in interests in oil, gas or other mineral exploration development programs; In addition, CIK may not: 14. invest in the aggregate more than 5% of the value of its total assets in securities denominated in a currency other than the United States dollar; or 15. invest in non-dividend paying equity securities if after such investment, total non-dividend paying equity securities would comprise more than 15% of CIK's total assets. And, CGF may not: 16. pledge, hypothecate, mortgage or otherwise encumber its assets in excess of 20% of the value of its total assets and then only to secure borrowings permitted by restriction 4 above; 17. invest 25% or more of the value of its total assets in any one industry, except that (i) for purposes of this restriction securities of the U.S. government, its agencies or instrumentalities are not considered to represent industries, and (ii) CGF may invest 25% or more of the value of its total assets in securities issued by or backed by the credit of supranational entities and securities of foreign governments, their agencies or instrumentalities, provided that it will not invest 25% or more of the value of its total assets in securities issued or backed by the credit of the national government of any single country or its agencies or instrumentalities or of any single supranational entity; or 18. issue senior securities, except as permitted under the 1940 Act. The deposit of initial and variation margin and collateral arrangements in connection with interest rate futures contracts and related options shall not be deemed to be in violation of any of the foregoing investment restrictions. If a percentage restriction on investment or use of assets set forth above is adhered to at the time a transaction is effected, later changes in percentages resulting from changing values will not be considered a violation. Under the Investment Company Act, the Funds may neither invest more than 5% of their total assets in the securities of any one investment company, nor acquire more than 3% of the outstanding voting securities of any such investment company. In addition, the Funds may not invest more than 10% of their total assets in securities issued by all investment companies. As a shareholder in any investment company, a Fund would bear its ratable share of that investment company's expenses, and would remain subject to payment of the advisory, sub-advisory and administrative fees with respect to assets so invested. -12- MANAGEMENT OF THE FUNDS Directors and Principal Officers The names, addresses and principal occupations of the directors and principal officers of each Fund are described under "Proposal 1 (Both Funds): Approval of the Agreement and Plan of Reorganization pursuant to which CIK Will Acquire All the Assets and Liabilities of CGF -- Management of the Funds -- Directors and Principal Officers" in the Proxy Statement/Prospectus. Compensation of Directors and Principal Officers For information about the compensation of the directors of CGF and CIK for the fiscal year ended December 31, 2000, see "Proposal 1 (Both Funds): Approval of the Agreement and Plan of Reorganization pursuant to which CIK Will Acquire All the Assets and Liabilities of CGF --- Management of the Funds" and "Proposal 3 (Credit Suisse Asset Management Income Fund Shareholders Only): Re-election of Directors -- Background" in the Proxy Statement/Prospectus. Control Persons and Principal Holders of Securities For information concerning persons who may be deemed beneficial owners of 5% or more of the shares of common stock of either Fund see "Proposal 1 (Both Funds): Approval of the Agreement and Plan of Reorganization pursuant to which CIK Will Acquire All the Assets and Liabilities of CGF --- Management of the Funds" in the Proxy Statement/Prospectus. Advisory Arrangements CSAM serves as the investment adviser to both Funds pursuant to advisory agreements with each Fund (the "Advisory Agreements"). Each Advisory Agreement provides that the Adviser shall not be liable for any error of judgment or mistake of law or for any loss suffered by the Fund in connection with the matters to which the Advisory Agreement relates, except a loss resulting from a breach of fiduciary duty with respect to the receipt of compensation for services (in which case any award of damages shall be limited to the period and the amount set forth in Section 36(b)(3) of the Investment Company Act) or a loss resulting from willful misfeasance, bad faith or gross negligence on the part of CSAM in the performance of its duties or from reckless disregard of its obligations and duties under the Advisory Agreement. The table below sets forth the investment advisory fees earned by CSAM for each Fund for the last three fiscal years. Fiscal year Ended CGF CIK December 31, 1998 $433,203 $1,421,865 1999 $406,567 $1,304,143 2000 $471,683 $1,148,861 For more information about CSAM and the Advisory Agreements, see "Proposal 1 (Both Funds): Approval of the Agreement and Plan of Reorganization pursuant to which CIK Will Acquire All the Assets and Liabilities of CGF -- Synopsis -- Fees and Expenses of CGF," "Proposal 1 (Both Funds): Approval of the Agreement and Plan of Reorganization pursuant to which CIK Will Acquire All the Assets and Liabilities of CGF--Synopsis--Fees and Expenses of CIK" and "Proposal 1 (Both Funds): Approval of the Agreement and Plan of Reorganization pursuant to which CIK Will Acquire All the -13- Assets and Liabilities of CGF -- Management" in the Proxy Statement/Prospectus. Shareholders of CIK have been requested to consider and approve a new investment advisory agreement with CSAM. For information regarding the terms of the new investment advisory agreement, see "Proposal 3 (CIK Shareholders Only): Approval of New Investment Advisory Agreement" in the Proxy Statement/Prospectus. Administrative Arrangements Brown Brothers Harriman & Co. ("BBH") is the Funds' administrator. The services provided by BBH under its Administration Agreement with the Funds are subject to the supervision of the directors and officers, and include day to day administration of matters related to its corporate existence, maintenance of its records, preparation of reports and supervision of arrangements with custodians and the transfer and dividend disbursing agent. The following table sets forth the amounts paid by each Fund as administrative fees for the last three fiscal years. Fiscal CGF CIK year Ended December 31, 1998(1) $132,539 $325,115 1999 $ 76,576 $203,030 2000 $ 84,784 $170,550 ------------ (1) Paid to Chase Manhattan Bank. Effective March 1, 1999, BBH replaced Chase Manhattan Bank as administrator to each Fund. Custodian BBH acts as custodian under a Custodian Agreement dated February 27, 1999. Foreign securities are held by certain foreign banks and securities depositories which have been approved by the board of directors upon the recommendation of BBH, in accordance with Rule 17f-5 under the 1940 Act as currently in effect. Approval of a foreign subcustodian is made by the board following a consideration of a number of factors, including, but not limited to, the reliability and financial stability of the institution; the ability of the institution to perform capably custodial services; the reputation of the institution in its national market; the political and economic stability of the country or countries in which the subcustodian will be located; and the risk of potential nationalization or expropriation of the assets. For additional information about the Funds' custodian, transfer agent and registrar, see "Proposal 1 (Both Funds): Approval of the Agreement and Plan of Reorganization pursuant to which CIK Will Acquire All the Assets and Liabilities of CGF--Management of the Funds" in the Proxy Statement/Prospectus. For information about the Funds' independent accountants, see "Proposal 1 (Both Funds): Approval of the Agreement and Plan of Reorganization pursuant to which CIK Will Acquire All the Assets and Liabilities of CGF--Experts" in the Proxy Statement/Prospectus. -14- Duration and Termination; Non-Exclusive Services The Advisory Agreements became effective on June 13, 1995 and were amended to reflect changes in the name and address of the respective parties thereto in February 2001. Unless earlier terminated as described below, each Advisory Agreement remains in effect if approved annually (a) by the board of directors or by the holders of a majority of the outstanding voting securities (as defined in the Investment Company Act) and (b) by a majority of the directors who are not parties to the Advisory Agreement or "interested persons" (as defined in the 1940 Act) of any such party. Each Advisory Agreement terminates on its assignment by any party and may be terminated without penalty on 60 days' written notice at the option of the board of directors or by the vote of the majority of the holders of the shares, or upon 90 days' written notice, by CSAM. The Administration Agreement is terminable upon 60 days' notice by either party. The services of CSAM and BBH are not deemed to be exclusive, and nothing in the relevant service agreements will prevent any of them or their affiliates from providing similar services to other investment companies and other clients (whether or not such clients' investment objectives and policies are similar to those of the Funds) or from engaging in other activities. Code of Ethics Each Fund and CSAM have adopted a written Code of Ethics, which permits personnel covered by the Code of Ethics ("Covered Persons") to invest in securities, including securities that may be purchased or held by the respective Fund. The Code of Ethics also contains provisions designed to address the conflicts of interest that could arise from personal trading by advisory personnel, including: (1) all Covered Persons must report their personal securities transactions at the end of each quarter; (2) with certain limited exceptions, all Covered Persons must obtain preclearance before executing any personal securities transactions; (3) Covered Persons may not execute personal trades in a security if there are any pending orders in that security by the respective Fund; and (4) Covered Persons may not invest in initial public offerings. The Board of Directors of each Fund reviews the administration of the Code of Ethics at least annually and may impose sanctions for violations of the Code of Ethics. Each Fund's Code of Ethics can be reviewed and copied at the Securities and Exchange Commission's Public Reference Room in Washington, D.C. Information on the operation of the Public Reference Room may be obtained by calling the Securities and Exchange Commission at (202) 942-8090. Each Fund's Code of Ethics is also available on the EDGAR Database on the Securities and Exchange Commission's Internet site at http:/www.sec.gov. Copies of each Fund's Code of Ethics may be obtained, after paying a duplicating fee, by electronic request at the following E-mail address: publicinfo@sec.gov, or by writing the Securities and Exchange Commission's Public Reference Section, Washington, D.C., 20549-0102. PORTFOLIO TRANSACTIONS Decisions to buy and sell securities for a Fund are made by CSAM, subject to the overall review of the board of directors of such Fund. Portfolio securities transactions are placed on behalf of the Funds by persons authorized by CSAM. CSAM manages other investment companies and accounts that invest in fixed-income securities. Although investment decisions for the Funds are made independently from those of these other accounts, CSAM may make investments of the type the Funds make on behalf of these other accounts. When the Funds and one or more other accounts is prepared to invest in, or desires to dispose of, the same security, CSAM will allocate available investments or opportunities for each in a -15- manner believed by CSAM to be equitable to each. In some cases, this procedure may adversely affect the price paid or received by the Funds or the size of the position it obtains or disposes of. The Funds may utilize CS First Boston Corporation and other affiliates of Credit Suisse in connection with the purchase or sale of securities in accordance with rules or exemptive orders adopted by the Securities and Exchange Commission when CSAM believes that the charge for the transaction does not exceed usual and customary levels. Transactions on U.S. and some foreign stock exchanges involve the payment of negotiated brokerage commissions, which may vary among different brokers. The cost of securities purchased from underwriters includes an underwriter's commission or concession, and the prices at which securities are purchased from and sold to dealers in the over-the-counter markets include a dealer's mark-up or mark-down, which normally is not disclosed. Fixed-income securities are generally traded on a "net" basis with dealers acting as principal for their own accounts without a stated commission, although the price of the security will likely include a profit to the dealer. In selecting brokers or dealers to execute portfolio transactions on behalf of the Funds, CSAM will seek the best overall terms available. In addition, unless otherwise directed by the board of directors, the Advisory Agreement authorizes CSAM, in selecting brokers or dealers to execute a particular transaction and in evaluating the best overall terms available, to consider the brokerage and research services (as those terms are defined in Section 28(e) of the Securities Exchange Act of 1934) and cause the Funds to pay a broker-dealer which furnishes such services a higher commission than that which might be charged by another broker-dealer for effecting the same transaction, provided that such commission is deemed reasonable in terms of either that particular transaction or the overall responsibilities of CSAM to the Funds. The fees payable under the Advisory Agreement are not reduced as a result of CSAM's receiving such brokerage and research services. Currently, it is the Funds' policy that CSAM may at times pay higher commissions than might otherwise be obtainable in recognition of brokerage services felt necessary for the achievement of best available price and most favorable execution of certain securities transactions. CSAM will only pay such higher commissions if it believes this to be in the best interest of the Funds. Some brokers or dealers who may receive such higher commissions in recognition of brokerage services related to execution of securities transactions are also providers of research information to CSAM and/or the Funds. Subject to the primary objective set forth above, CSAM has informed the Funds that they may pay higher commission rates specifically for the purpose of obtaining research services. The Funds will not pay to any affiliate of CSAM a higher commission rate specifically for the purpose of obtaining research services. The Funds paid no brokerage commissions in any of the fiscal years ended December 31, 2000, 1999 and 1998. DIVIDEND REINVESTMENT AND CASH PURCHASE PLAN Each Fund distributes monthly to shareholders substantially all of its net investment income. Net short-term capital gains, if any, are distributed annually. The board of each Fund intend to distribute annually any net long-term realized capital gains (the excess of net long-term capital gains over net short-term capital losses). See "Taxation." You may elect to have all dividends and distributions, net of any U.S. withholding tax, automatically reinvested in additional shares through the Fund's "InvestLink"(SM)- Program. Fleet National Bank, c/o EquiServe, L.O., is the program administrator for the "InvestLink"(SM)- Program. "InvestLink"(SM) is a service mark of EquiServe, L.P. -16- Purpose of the Investlink(SM) Program The purpose of the "InvestLink"(SM)- Program is to provide you with a simple and convenient way to invest funds and reinvest dividends in shares of the Funds stock at prevailing prices, with reduced brokerage commissions and fees. Eligibility and Participation You may join the program at any time by completing and signing the enrollment form and returning it to Fleet National Bank, c/o EquiServe, L.P.. Enrollment forms may be obtained at any time by calling the program administrator at one of the telephone numbers listed below: - First Time Investors - 1-888-697-8026 (CIK) 1-800-523-8566 (CGF) - Current Shareholders - 1-800-730-6001 Beneficial owners whose shares are registered in the name of a bank, broker or other nominee ("streetname") must make arrangements with such bank, broker or nominee to have the shares transferred into their own names if they wish to have dividends on such shares paid to the program administrator pursuant to the program. Purchases of shares with funds from your cash payment will begin on the next investment date, provided that the payment is received at least two business days prior ("cash cut-off date"). Automatic account deduction will begin on the next debit date, provided the automatic deduction request was received during the month prior. If you select the dividend reinvestment option, automatic investment of dividends will begin with the next dividend payable after the program administrator receives your enrollment form, provided it is received prior to the dividend record date. If your enrollment form arrives after the record date, automatic investment of dividends will begin with the following dividend. Once in the program, you will remain a participant until you terminate your participation or sell all shares held in your program account, or your account is terminated by the program administrator. Program Options The program offers various investment options, as outlined below: o "Automatic Bank Account Deduction": Funds in the amount you specify, with a minimum of $100.00, will be debited from your bank account each month on the 20th or next business day. The program administrator will invest such funds on the first Wednesday, or next business day, of the month following to purchase additional shares of the Funds. o "Full Dividend Reinvestment": The program administrator will receive all cash dividends payable on shares held in your program account and on any other shares registered in your name. In addition, the program administrator will invest in shares of the Funds all of your cash dividends on all of the shares then or subsequently registered in your name or held in your program account. You will have the ability to send in optional cash payments that will be invested weekly. o "Partial Dividend Reinvestment": The program administrator will receive a portion of cash dividends payable on shares held in your program account and -17- on any other shares of the Funds registered in your name. In addition, the program administrator will invest that portion of cash dividends on shares held in your program account and any other shares of the Funds registered in your name. You will have the ability to send in optional cash payments that will be invested weekly. o "Cash Investments": The program administrator will not invest any portion of cash dividends due you on shares held in your program account or on shares registered in your name. You will have the ability to send in optional cash payments that will be invested weekly. You may change your investment options at any time by requesting a new authorization form and returning it to the program administrator. The program administrator must receive notice on or before the record date preceding a dividend payment date in order for a change in your dividend reinvestment option to be effective for that dividend. Costs to participants in connection with purchases and sales under the program In connection with the following transactions, participants will be assessed the following charges: o First-time investors will be subject to an initial service charge of $10.00 which will be deducted from the initial cash deposit. o All optional cash deposit investments and automatic account deductions will have a service charge of $5.00 deducted from the cash to be invested. o Sales processed through the program will have a service fee of $10.00 deducted from the net proceeds, after brokerage commissions. o Participants are responsible for all commission costs associated with purchases and sales. In addition to the transaction charges outlined above, participants will be assessed per share processing fees which include brokerage commissions. Purchase of the Funds' shares The program administrator uses dividends and funds of participants to purchase shares of the Funds' common stock in the open market. Such purchases will be made by participating brokers as agent for the participants. Dividends will be invested on the 15th of each month or next business day. Optional cash payments will be invested weekly on Wednesday except in dividend paying weeks. On those weeks, the optional cash will be invested with the dividend. Transaction processing will generally occur within 30 days of the receipt of funds. In the event the program administrator is unable to purchase shares within 30 days of the receipt of funds, such funds will be returned to you. Shares offered under the program to participants in certain jurisdictions may be offered only through broker-dealers registered in these jurisdictions. The weighted average price of all shares purchased by the program administrator with all funds received during the time period from two business days preceding any investment date up to the second business day preceding the next investment date shall be the price per share allocable to you in connection with the shares purchased for your account with your funds or dividends received by the program -18- administrator during such time period. The weighted average price of all shares sold by the program administrator pursuant to sell orders received during such time period shall be the price per share allocable to you in connection with the shares sold for your account pursuant to your sell orders received by the program administrator during such time period. Cash payments and automatic bank account deductions If you are not already a registered owner of the Funds' common stock, your initial investment under the program must be at least $250.00. All other cash payments or bank account deductions must be at least $100.00, up to a maximum of $100,000.00 annually. The same amount of cash payment need not be sent each month and you are under no obligation to make a cash payment in any month. The amount of automatic bank account deduction must be specified by you on the enrollment form and will continue until changed by you by notifying the program administrator. Administration Fleet National Bank, c/o EquiServe, L.P., as program administrator, administers the program for participants, keeps records, sends statements of account to participants and performs other duties relating to the program. Shares of the Funds' common stock purchased under the program will be registered in the name of the accounts of the respective participants. Reports to participants Each participant in the program will receive a statement of his or her account following each purchase of shares. These statements are a record of the cost of purchase of shares under the program and should be retained for tax purposes. The statements will also show the amount of dividends credited to such participant's account (if applicable), as well as the fees paid by the participant. In addition, each participant will receive copies of the Funds' annual reports to shareholders, proxy statements and, if applicable, dividend income information for tax reporting purposes. Certificates for shares Unless requested, the Funds will not issue to participants certificates for shares of the Funds' common stock purchased under the program. The number of shares purchased for your account under the program will be shown on your statement of account. This feature protects against loss, theft or destruction of stock certificates. Certificates for any number of whole shares credited to your account under the program will be issued to you at no charge upon your written request to withdraw such shares from your account. Certificates for fractions of shares will not be issued. Withdrawal of shares in program accounts You may withdraw all or a portion of the shares from your program account by notifying the program administrator. A withdrawal/termination form is provided on the account statement for this purpose. This notice should be mailed to the address on the form. Within five business days of receipt of your request, certificates for the whole shares of the Funds' common stock so withdrawn will be issued to you or, if you request, the program administrator will sell the shares for you and send you the proceeds, less applicable brokerage commissions, fees, and -19- transfer taxes, if any. Proceeds are normally paid by check and will be distributed to you within four business days after your shares are sold. In no case will certificates for fractional shares be issued. If you withdraw all full and fractional shares in your program account, your participation in the program will be terminated by the program administrator. Also, the program administrator must receive such termination notice at least seven business days prior to the dividend payment date in order for you to receive such dividend in cash. Rights offerings, stock dividends and stock splits Participation in any rights offering (including the offer), dividend distribution or stock split will be based upon both the shares of the Funds registered in participants' names and the shares (including fractional shares) credited to participants' program accounts. Any stock dividend or shares resulting from stock splits with respect to shares of the Funds, both full and fractional, which participants hold in their program accounts and with respect to all shares registered in their names will be automatically credited to their accounts in book-entry form. Voting of a participant's program shares at a meeting of shareholders All shares (including any fractional share) credited to your account under the program will be voted as you direct. If on the record date for a meeting of shareholders there are shares credited to your account under the program, you will be sent the proxy materials for such meeting. When you return an executed proxy, all of such shares will be voted as indicated. Or, if you so elect, you may vote all of such shares in person at the shareholders' meeting. If you do not provide instructions or return an executed proxy, the plan will not vote your shares. Federal income tax consequences of participation in the program You will receive tax information annually for your personal records and to help you prepare your federal income tax return. The automatic reinvestment of dividends does not relieve you of any income tax which may be payable on dividends. For further information as to tax consequences of participation in the program, participants should consult with their own tax advisors. Responsibility of the program administrator under the program The program administrator in administering the program will not be liable for any act done in good faith or for any good faith omission to act. However, the program administrator will be liable for loss or damage due to error caused by its negligence, bad faith or willful misconduct. Shares held in custody by the program administrator are not subject to protection under the Securities Investors Protection Act of 1970. The participant should recognize that neither the funds nor the program administrator can provide any assurance of a profit or protection against loss on any shares purchased under the program. While the program administrator hopes to continue the program indefinitely, the program administrator reserves the right to suspend or terminate the program at any time. It also reserves the right to make modifications to the program. Participants will be notified of any such suspension, termination or modification. The program administrator also reserves the right to terminate any participant's participation in the program at any time. Any question of interpretation arising under the program will be determined by the program administrator in good faith and any such determination will be final. -20- Contact information All correspondence regarding the program should be directed to: Fleet National Bank C/o EquiServe, L.P. "InvestLink" Program P.O. Box 43010 Providence, RI 02940-3010 First Time Investors: 1-888-697-8026 (CIK) 1-800-523-8566 (CGF) Current Shareholders: 1-800-730-6001 -21- TAXATION The following is a summary of the material United States federal income tax considerations regarding the purchase, ownership and disposition of shares. You are urged to consult your own tax adviser with respect to the specific federal, state, local and foreign tax consequences of investing in the Funds. The summary is based on the laws in effect on the date of this statement of additional information, which are subject to change. The Funds and their investments Each of the Funds has qualified and continues to qualify to be treated as a regulated investment company for each taxable year under the Code. To so qualify, a Fund must, among other things: derive at least 90% of its gross income in each taxable year from: o dividends o interest o payments with respect to securities loans o gains from the sale or other disposition of stock or securities or foreign currencies o other income (including, but not limited to, gains from options, futures or forward contracts) derived with respect to its business of investing in such stock, securities or currencies, and diversify its holdings so that, at the end of each quarter of the taxable year: o at least 50% of the market value of the Fund's assets is represented by cash, securities of other regulated investment companies, United States government securities and other securities, with such other securities limited, in respect of any one issuer, to an amount not greater than 5% of the Funds' assets and not greater than 10% of the outstanding voting securities of such issuer, and o not more than 25% of the value of its assets is invested in the securities (other than United States government securities or securities of other regulated investment companies) of any one issuer or any two or more issuers that the Fund controls and which are determined to be engaged in the same or similar trades or businesses or related trades or businesses. As a regulated investment company, a Fund is not subject to United States federal income tax on its net investment income (i.e., income other than its net realized long-term and short-term capital gains) and its net realized long-term and short-term capital gains, if any, that it distributes to its shareholders, provided that an amount equal to at least 90% of the sum of its investment company taxable income (i.e., its taxable income minus the excess, if any, of its net realized long-term capital gains over its net realized short-term capital losses (including any capital loss carryovers), plus or minus certain other adjustments specified in section 852 of the Code) and its net tax-exempt income for the taxable year, if any, is distributed to its shareholders, but is subject to tax at regular corporate rates on any taxable income or gains that it does not distribute. -22- The Code imposes a 4% nondeductible excise tax on a Fund to the extent it does not distribute by the end of any calendar year at least 98% of its net investment income for that year and 98% of the net amount of its capital gains (both long-term and short-term) for the one-year period ending, as a general rule, on October 31 of that year. For this purpose, however, any income or gain retained by the Fund that is subject to corporate income tax will be considered to have been distributed by year-end. In addition, the minimum amounts that must be distributed in any year to avoid the excise tax will be increased or decreased to reflect any underdistribution or overdistribution, as the case may be, from the previous year. The Funds anticipate that they will pay such dividends and will make such distributions as are necessary in order to avoid the application of this tax. If, in any taxable year, a Fund fails to qualify as a regulated investment company under the Code, the Fund would be taxed in the same manner as an ordinary corporation and distributions to its shareholders would not be deductible by the Fund in computing its taxable income. In addition, in the event of a failure to qualify, a Fund's distributions, to the extent derived from current or accumulated earnings and profits, would constitute dividends (eligible for the corporate dividends-received deduction) which are taxable to its shareholders as ordinary income, even though those distributions might otherwise (at least in part) have been treated as long-term capital gains when received by its shareholders. If a Fund fails to qualify as a regulated investment company in any year, it must pay out its earnings and profits accumulated in that year in order to qualify again as a regulated investment company. In addition, if a Fund failed to qualify as a regulated investment company for a period greater than one taxable year, it may be required to recognize any net built-in gains with respect to certain of its assets (the excess of the aggregate gains, including items of income, over aggregate losses that would have been realized if it had been liquidated) in order to qualify as a regulated investment company in a subsequent year. Each of the Funds pays dividends of net investment income monthly and makes distributions at least annually of any net realized long-term and short-term capital gains in excess of applicable capital losses, including capital loss carryforwards. The board of directors of each Fund determines annually whether to distribute any net realized long-term capital gains in excess of its net realized short-term capital losses (including any capital loss carryovers). Each of the Funds currently expects to distribute any such excess annually to its shareholders. However, if a Fund retains for investment an amount equal to all or a portion of its net realized long-term capital gains in excess of its net realized short-term capital losses and capital loss carryovers, it will be subject to a corporate tax (currently at a rate of 35%) on the amount retained. In that event, the Fund expects to designate such retained amounts as undistributed capital gains in a notice to its shareholders who (a) will be required to include in income for United States federal income tax purposes, as long-term capital gains, their proportionate shares of the undistributed amount, (b) will be entitled to credit their proportionate shares of the 35% tax paid by the Fund on the undistributed amount against their United States federal income tax liabilities, if any, and to claim refunds to the extent their credits exceed their liabilities, if any, and (c) will be entitled to increase their tax basis, for United States federal income tax purposes, in their shares by an amount equal to 65% of the amount of undistributed capital gains included in their income. Any dividend declared by the Funds in October, November or December of any calendar year and payable to shareholders of record on a specified date in such a month shall be deemed to have been received by each shareholder on December 31 of such calendar year and to have been paid by the Funds not later than such December 31, provided that such dividends are actually paid by the Funds during January of the following calendar year. Dividends and distributions If you are a U.S. shareholder, dividends of net investment income and distributions of net realized short-term capital gains are taxable to you as ordinary income, whether paid in cash or in shares. Distributions of net long-term capital gains, if any, that a Fund designates as capital gains dividends are -23- taxable as long-term capital gains, whether paid in cash or in shares and regardless of how long you have held your shares. Dividends and distributions paid by a Fund (except for the portion thereof, if any, attributable to dividends on stock of U.S. corporations received by the Fund) will not qualify for the deduction for dividends received by corporations. Distributions in excess of a Fund's current and accumulated earnings and profits will, as to you, be treated as a tax-free return of capital, to the extent of your basis in your shares, and as a capital gain thereafter (if you hold your shares as capital assets). If you receive dividends or distributions in the form of additional shares pursuant to the Dividend Reinvestment and Cash Purchase Plan you should be treated for United States federal income tax purposes as receiving a distribution in the amount equal to the amount of money that shareholders receiving cash dividends or distributions will receive, and should have a cost basis in the shares received equal to such amount. If you are considering buying shares just prior to a dividend or capital gain distribution you should be aware that, although the price of shares just purchased at that time may reflect the amount of the forthcoming distribution, such dividend or distribution may nevertheless be taxable to you. If a Fund is the holder of record of any stock on the record date for any dividends payable with respect to such stock, such dividends are included in the Fund's gross income not as of the date received but as of the later of (a) the date such stock went ex-dividend (i.e., the date on which a buyer of the stock would not be entitled to receive the declared, but unpaid, dividends) or (b) the date the Fund acquired such stock. Accordingly, in order to satisfy its income distribution requirements, a Fund may be required to pay dividends based on anticipated earnings, and you may receive dividends in an earlier year than would otherwise be the case. Sales of shares Upon the sale or exchange of your shares, you will realize a taxable gain or loss equal to the difference between the amount realized and the basis in your shares. Such gain or loss will be treated as capital gain or loss, if the shares are capital assets in your hands, and will be long-term capital gain or loss if the shares are held for more than one year and short-term capital gain or loss if the shares are held for one year or less. Any loss realized on a sale or exchange will be disallowed to the extent the shares disposed of are replaced, including replacement through the reinvesting of dividends and capital gains distributions in the Fund under the Dividend Reinvestment and Cash Purchase Plan, within a 61-day period beginning 30 days before and ending 30 days after the disposition of the shares. In such a case, the basis of the shares acquired will be increased to reflect the disallowed loss. Any loss realized by you on the sale of a share held by you for six months or less will be treated for United States federal income tax purposes as a long-term capital loss to the extent of any distributions or deemed distributions of long-term capital gains received by you with respect to such share. Backup withholding If you fail to provide your Fund with your correct taxpayer identification number or to make required certifications, or have been notified by the Internal Revenue Service that you are subject to backup withholding, the Fund may be required to withhold, for United States federal income tax purposes, 31% of the dividends and distributions payable. Corporate shareholders and certain other shareholders are or may be exempt from backup withholding. Backup withholding is not an additional tax and any amount withheld may be credited against your United States federal income tax liabilities. If you are a foreign investor, additional tax withholding requirements which may apply are discussed below. -24- Foreign shareholders If you are a foreign investor (such as a nonresident alien individual, a foreign trust or estate, a foreign corporation or a foreign partnership) under U.S. laws, taxation depends, in part, on whether your income from the Funds is "effectively connected" with a United States trade or business carried on by you. If you are not a resident alien and your income from a Fund is not effectively connected with a United States trade or business carried on by you, distributions of net investment income and net realized short-term capital gains will be subject to a 30% (or lower treaty rate) United States withholding tax. If you are a nonresident alien, distributions of net realized long-term capital gains, amounts retained by the Funds which are designated as undistributed capital gains, and gains realized upon the sale of shares of a Fund generally will not be subject to United States tax unless you are physically present in the United States for more than 182 days during the taxable year and, in the case of gain realized upon the sale of shares, unless (a) such gain is attributable to an office or fixed place of business in the United States or (b) you have a tax home in the United States and such gain is not attributable to an office or fixed place of business located outside the United States. However, a determination by a Fund not to distribute long-term capital gains will cause the Fund to incur a U.S. federal tax liability with respect to retained long-term capital gains, thereby reducing the amount of cash held by the Funds that is available for investment, and you may not be able to claim a credit or deduction with respect to such taxes. In general, if you are a resident alien or if dividends or distributions from a Fund are effectively connected with a United States trade or business carried on by you, then dividends of net investment income, distributions of net short-term and long-term capital gains, amounts retained by the Fund that are designated as undistributed capital gains and any gains realized upon the sale of shares will be subject to United States income tax at the rates applicable to United States citizens or domestic corporations. If you are a corporation, and your income from a Fund is effectively connected with a United States trade or business, you may also be subject to the 30% (or lower treaty rate) branch profits tax. If you are entitled to claim the benefits of an applicable tax treaty, the tax consequences to you may be different from those described in this section. You may be required to provide appropriate documentation to establish your entitlement to the benefits of such a treaty. You are advised to consult your own tax adviser with respect to (a) whether your income from a Fund is or is not effectively connected with a United States trade or business carried on by you, (b) whether you may claim the benefits of an applicable tax treaty, and (c) any other tax consequences to you of an investment in the Funds. Notices You will be notified annually by each Fund as to the United States federal income tax status of the dividends, distributions and deemed distributions made by the Fund to you. Furthermore, you will also receive, if appropriate, various written notices after the close of the Fund's taxable year regarding the United States federal income tax status of certain dividends, distributions and deemed distributions that were paid (or that are treated as having been paid) by the Funds to you during the preceding taxable year. OTHER TAXATION. Distributions also may be subject to additional state, local and foreign taxes depending on your particular situation. Fund investments Market discount -25- If a Fund purchases a debt security at a price lower than the stated redemption price of such debt security, the excess of the stated redemption price over the purchase price is "market discount." If the amount of market discount is more than a de minimis amount, the Fund must include a portion of such market discount as ordinary income (not capital gain) in each taxable year in which the Fund owns an interest in such debt security and receives a principal payment on it. In particular, the Fund will be required to allocate that principal payment first to the portion of the market discount on the debt security that has accrued but has not previously been includable in income. In general, the amount of market discount that must be included for each period is equal to the lesser of (i) the amount of market discount accruing during such period (plus any accrued market discount for prior periods not previously taken into account) or (ii) the amount of the principal payment with respect to such period. Generally, market discount accrues on a daily basis for each day the debt security is held by the Fund at a constant rate over the time remaining to the debt security's maturity or, at the election of the Fund, at a constant yield to maturity which takes into account the semi-annual compounding of interest. Gain realized on the disposition of a market discount obligation must be recognized as ordinary interest income (not capital gain) to the extent of the "accrued market discount." Original issue discount Certain debt securities acquired by a Fund may be treated as debt securities that were originally issued at a discount. Generally, original issue discount is defined as the difference between the price at which a security was issued and its stated redemption price at maturity. Although no cash income is actually received by the Fund, original issue discount that accrues on a debt security in a given year generally is treated for federal income tax purposes as interest and, therefore, such income would be subject to the distribution requirements applicable to regulated investment companies. In order to maintain its status as a regulated investment company, the Fund could therefore be required to incur debt or to dispose of portfolio securities to generate cash for distribution. Some debt securities may be purchased by a Fund at a discount that exceeds the original issue discount on such debt securities, if any. This additional discount represents market discount for federal income tax purposes (see above). Options, futures and forward contracts A Fund's transactions in options and futures contracts will be subject to special provisions of the Code that, among other things, may affect the character of gains and losses realized by the Fund (i.e., it may affect whether gains or losses are ordinary or capital), accelerate recognition of income and defer losses. These rules could therefore affect the character, amount and timing of distributions to the Fund's shareholders. These provisions also (a) will require the Fund to mark-to-market certain types of the positions in its portfolio (i.e., treat them as if they were closed out) and (b) may cause the Fund to recognize income without receiving cash to pay dividends or make distributions in amounts necessary to satisfy the distribution requirements for avoiding income and excise taxes. Each Fund will monitor its transactions, will make the appropriate tax elections and will make the appropriate entries in its books and records when it acquires any option, futures contract or hedged investment in order to mitigate the effect of these rules and prevent its disqualification as a regulated investment company. Any regulated futures contracts and certain options (namely, nonequity options and dealer equity options) in which a Fund may invest may be "section 1256 contracts." Gains (or losses) on these contracts generally are considered to be 60% long-term and 40% short-term capital gains or losses. Also, section 1256 contracts held by a Fund at the end of each taxable year (and on certain other dates prescribed in the Code) are "marked to market" with the result that unrealized gains or losses are treated as though they were realized. -26- Transactions in options, futures and forward contracts undertaken by a Fund may result in "straddles" for federal income tax purposes. The straddle rules may affect the character of gains (or losses) realized from such transactions, and losses realized by the Fund on positions that are part of a straddle may be deferred under the straddle rules, rather than being taken into account in calculating the taxable income for the taxable year in which the losses are realized. In addition, certain carrying charges (including interest expense) associated with positions in a straddle may be required to be capitalized rather than deducted currently. Certain elections that a Fund may make with respect to its straddle positions may also affect the amount, character and timing of the recognition of gains or losses from the affected positions. Because only a few regulations implementing the straddle rules have been promulgated, the consequences of such transactions to a Fund are not entirely clear. The straddle rules may increase the amount of short-term capital gain realized by a Fund, which is taxed as ordinary income when distributed to its shareholders. Because application of the straddle rules may affect the character of gains or losses, defer losses and/or accelerate the recognition of gains or losses from the affected straddle positions, the amount which must be distributed to you as ordinary income or long-term capital gain may be increased or decreased substantially as compared to a fund that did not engage in such transactions. Constructive sales Under certain circumstances, a Fund may recognize gain from a constructive sale of an "appreciated financial position" it holds if it enters into a short sale, forward contract or other transaction that substantially reduces the risk of loss with respect to the appreciated position. In that event, the Fund would be treated as if it had sold and immediately repurchased the property and would be taxed on any gain (but not loss) from the constructive sale. The character of gain from a constructive sale would depend upon the Fund's holding period in the property. Loss from a constructive sale would be recognized when the property was subsequently disposed of, and its character would depend on the Fund's holding period and the application of various loss deferral provisions of the code. Constructive sale treatment does not apply to transactions closed prior to the end of the 30th day after the close of the taxable year, if certain conditions are met. Section 988 gains or losses Gains or losses attributable to fluctuations in exchange rates which occur between the time a Fund accrues income or other receivables or accrues expenses or other liabilities denominated in a foreign currency and the time the Fund actually collects such receivables or pays such liabilities generally are treated as ordinary income or ordinary loss. Similarly, on disposition of some investments, including debt securities and certain forward contracts denominated in a foreign currency, gains or losses attributable to fluctuations in the value of the foreign currency between the acquisition and disposition of the position also are treated as ordinary gain or loss. These gains and losses, referred to under the Code as "section 988" gains or losses, increase or decrease the amount of the Fund's investment company taxable income available to be distributed to its shareholders as ordinary income. If section 988 losses exceed other investment company taxable income during a taxable year, the Fund would not be able to make any ordinary dividend distributions, or distributions made before the losses were realized would be recharacterized as a return of capital to its shareholders, rather than as an ordinary dividend, thereby reducing the basis of the Fund shares. THE FOREGOING IS ONLY A SUMMARY OF CERTAIN MATERIAL TAX CONSEQUENCES AFFECTING THE FUNDS AND YOURSELF. YOU ARE ADVISED TO CONSULT YOUR OWN TAX ADVISER WITH RESPECT TO THE PARTICULAR TAX CONSEQUENCES TO YOU OF AN INVESTMENT IN THE FUNDS. -27- FINANCIAL STATEMENTS The audited financial statements, notes to the audited financial statements and report of the independent public accountants of CIK and CGF for the fiscal year ended December 31, 2000 are included in the annual report of each Fund for such fiscal year. The annual report of each Fund, which either accompany this Statement of Additional Information or has previously been provided to you, is incorporated herein by reference with respect to such information. The annual report of each Fund may be obtained without charge, by writing to Shareholder Communications Corporation, 17 State Street, New York, New York 10004, or by calling 1(800) 223-2064. PRO FORMA FINANCIAL STATEMENTS The following tables set forth the unaudited pro forma condensed statement of assets and liabilities and unaudited pro forma condensed statement of operations for each Fund as of and for the year ended December 31, 2000 as adjusted to give effect to the Reorganization. -28- YEAR ENDED DECEMBER 31, 2000 PRO FORMA COMBINED STATEMENT OF ASSETS AND LIABILITIES
Pro-Forma of Combined Statement of Assets and CGF CIK Adjustments Liabilities --------------------------------------------------------------------- ASSETS Investments at Value (CGF Cost $99,627,659) (CIK Cost $267,765,551)........ $ 82,645,303 $ 191,985,690 $ 274,630,993 Receivables: Dividend and Interest ................................ 2,737,843 6,212,535 8,950,378 Investments Sold...................................... 135,095 135,095 Other Assets.......................................... 17,117 24,695 41,812 ------------- -------------- ------------- Total Assets............................................. 85,535,358 198,222,920 283,758,278 ============= ============== ============= LIABILITIES Payables: Unrealized Depreciation of Forward Foreign Currency Exchange Contracts................................. 7,411 0 7,411 Investment Advisory Fees.............................. 100,691 258,798 359,489 Professional Fees..................................... 39,613 45,581 85,194 Shareholders' Reports................................. 17,870 44,798 62,668 Custodian Fees........................................ 13,465 15,575 29,040 Administrative Fees................................... 12,243 27,000 39,243 Investments Purchased................................. 7,044 0 7,044 Shareholder Servicing Fees............................ 4,295 0 4,295 Directors' Fees....................................... 750 750 1,500 Other Liabilities..................................... 413 13,414 13,827 ------------- -------------- ------------- Total Liabilities........................................ 203,795 405,916 609,711 ------------- -------------- ------------- Net Assets............................................... 85,331,563 197,817,004 283,148,567 ------------- -------------- ------------- Net Assets Consist of: Capital Shares at $.001 Par Value........................ 11,977 34,708 2,995 49,680 Capital Paid in Excess of Par Value...................... 110,670,038 288,994,680 (2,995) 399,661,723 Distributions in Excess of Net Investment Loss....................................... (43,455) (61,160) (104,615) Accumulated Net Realized Loss............................ (8,319,202) (15,371,363) (23,690,565) Unrealized Depreciation on Investments and Foreign Currency Translations................................. (16,987,795) (75,779,861) (92,767,656) ------------- -------------- ------------- Net Assets............................................... $ 85,331,563 $ 197,817,004 0 $ 283,148,567 ------------- -------------- ------------ ------------- Shares Outstanding....................................... 11,976,699 34,708,369 2,993,751 49,678,819 ------------- -------------- ------------ ------------- Net Asset Value Per Share................................ $7.12 $5.70 $5.70
See Notes to Pro Forma Financial Statements YEAR ENDED DECEMBER 31, 2000 PRO-FORMA COMBINED STATEMENT OF OPERATIONS
Pro-Forma of Combined Statement CGF CIK Adjustments of Operations Notes ----------------------------------------------------------------------------- INVESTMENT INCOME Interest (Net of foreign taxes withheld of $134,649)...... $ 10,080,876 $ 24,488,930 $ 0 $ 34,569,806 Dividends........................................... 200,962 528,610 0 729,572 ------------- --------------- ----------- ------------- Total Income..................................... 10,281,838 25,017,540 0 35,299,378 ------------- -------------- ----------- ------------- EXPENSES Investment Advisory Fees......................... 471,683 1,148,861 (131,056) 1,489,488 a Shareholders' Reports............................ 154,091 143,814 (113,198) 184,707 b Administrative Fees.............................. 84,784 170,550 (42,719) 212,615 c Professional Fees................................ 80,825 68,699 (49,024) 100,500 d Custodian Fees................................... 78,483 91,182 (72,786) 96,879 e Directors' Fees and Expenses..................... 43,932 43,419 (32,061) 55,290 f Shareholder Servicing Fees....................... 36,583 73,001 (25,584) 84,000 g Annual Meeting Fees.............................. 26,836 0 7,933 34,769 h Other............................................ 10,913 61,342 1,744 73,999 i ------------- --------------- ----------- ------------- Total Expenses...................................... 988,130 1,800,868 (456,751) 2,332,247 ------------- --------------- ----------- ------------- Net Investment Income............................... 9,293,708 23,216,672 32,967,131 ------------- -------------- ------------- Net Realized Gain (Loss): Investments...................................... 1,381,434 (4,981,733) 0 (3,600,299) Foreign Currency................................. 35,478 (50,319) 0 (14,841) Total Net Realized Gain (Loss)...................... 1,416,912 (5,032,052) 0 (3,615,140) Change in Unrealized Appreciation (Depreciation): Investments...................................... (15,495,992) (48,839,274) 0 (64,335,266) ------------- --------------- ----------- ------------- Net Realized Loss and Change in Unrealized Appreciation (Depreciation)...................... (14,079,080) (53,871,326) 0 (67,950,406) ------------- --------------- ----------- ------------- NET DECREASE IN NET ASSETS RESULTING FROM OPERATIONS....................................... $ (4,785,372) $ (30,654,654) $ (456,751) $ (34,983,275) ------------- --------------- ----------- -------------
- ------------------ (a) Based on the New Investment Advisory Agreement if it had been in place for the year ended 12/31/00. (b) Estimated expenses of combined Funds. (c) Estimated fees using current administration contract. (d) Estimated expenses of combined Funds. (e) Estimated fees based on current agreement in place. (f) Estimated fees based on current agreement plus additional out of pocket expenses and meeting fees. (g) Estimated expenses of combined Funds. (h) Estimated expenses of combined Funds. (i) Estimated expenses includes NYSE expense, Insurance expense and miscellaneous charges. See Notes to Pro Forma Financial Statements PRO FORMA PORTFOLIO OF INVESTMENTS OF COMBINED FUND December 31, 2000
CGF CGF --------------- ----------------- Moody's Face Face Face Ratings Amount Amount Amount (Unaudited) (000) Value (000) Value (000) Value ----------- ------ ----- ------ ----- ------ ----- DOMESTIC SECURITIES (86.0%) CORPORATE OBLIGATIONS (79.7%) Aerospace/Defense (0.7%) Decrane Aircraft Holdings Series B, Gtd. 12.00%, 9/30/08 (1) Caa1 800 732,000 $800 $732,000 Lockheed Martin Corp. Notes 7.95%, 12/1/05 Baa3 195 207,908 195 207,908 Raytheon Co. Notes 6.45%, 8/15/02 Baa2 400 398,580 400 398,580 Sequa Corp. Sr. Notes 9.00%, 8/1/09 Ba2 250 249,375 250 249,375 United Technologies Corp. Notes 6.625%, 11/15/04 A2 260 265,216 260 265,216 Group Total 249,375 1,603,704 1,853,079 Automotive (2.1%) Aetna Industries, Inc. Sr. Notes 11.875%, 10/1/06 B3 600 303,750 600 303,750 Cambridge Industries, Inc. Series B, Gtd. Sr. Sub. Notes 10.25%, 7/15/07 (2) N/R 250 63,750 500 127,500 750 191,250 Collins & Aikman Products Corp. Sr. Sub. Notes 11.50%, 4/15/06 B2 250 196,250 700 686,000 950 882,250 Daimler Chrysler NA Holdings, Corp.: Gtd.7.40%, 1/20/05 A2 125 125,643 125 125,643 8.00%, 6/15/10 A2 100 101,046 100 101,046 Delco Remy International, Inc. Gtd. Sr. Sub. Notes 10.625%, 8/1/06 B2 250 211,250 750 633,750 Diamond Triumph Auto Gtd. 9.25%, 4/1/08 B3 500 367,500 Hayes Lemmerz International, Inc.: Series B, Gtd. Sr. Notes 9.125%, 7/15/07 B2 500 332,500 8.25%, 12/15/08 B2 1,000 650,000 Motor Coach Industries International, Inc. Gtd. 11.25%, 5/1/09 B2 1,250 343,750 Oxford Automotive, Inc. Gtd. Sr. Sub. Notes 10.125%, 6/15/07 Caa1 $1,625 $1,113,125 PEP Boys-Manny Moe & Jack Notes 7.00%, 6/1/05 Ba3 750 470,692 Safety Components International, Inc. Series B, Gtd. Sr. Sub. Notes 10.125%, 7/15/07 (2) B3 500 107,500 Stanadyne Automotive Series B, Gtd. Sr. Sub. Notes 10.25%, 12/15/07 Caa1 400 299,000 Visteon Corp. Sr. Notes 8.25%, 8/1/10 Baa2 50 49,380 Group Total 5,971,136 Broadcasting (4.2%) ACME Television LLC/ ACME Financial Corp. Gtd. Sr. Discount Notes 0.00%, 9/30/04 (3) B3 500 435,000 Australis Holdings Pty. Ltd. Yankee Sr. Secured Discount Notes 0.00%, 11/1/02 (2)(3) N/R 4,600 460 Australis Media Ltd. Yankee Units 15.75%, 5/15/03 (2)(6) N/R 3,141 15,704 Citadel Broadcasting Co. Gtd. 9.25%, 11/15/08 B3 $250 $243,750 Cumulus Media, Inc. Sr. Sub. Notes 10.375%, 7/1/08 B3 800 646,000 EchoStar Communications Corp. Sr. Notes 9.375%, 2/1/09 B1 1,000 975,000 Granite Broadcasting Corp.: Series A, Sr. Sub. Notes 9.375%, 12/1/05 Caa1 300 184,500 8.875%, 5/15/08 Caa1 1,150 707,250 Pegasus Media &Communications, Inc.Series B, Notes12.50%, 7/1/05 B3 500 505,000
PRO FORMA PORTFOLIO OF INVESTMENTS OF COMBINED FUND December 31, 2000
CGF CGF --------------- ----------------- Moody's Face Face Face Ratings Amount Amount Amount (Unaudited) (000) Value (000) Value (000) Value ----------- ------ ----- ------ ----- ------ ----- Salem Communications Corp. Series B, Gtd. 9.50%, 10/1/07 B3 850 808,563 Sinclair Broadcast Group, Inc.: Sr. Sub. Notes 10.00%, 9/30/05 B2 1,200 1,170,000 8.75%, 12/15/07 B2 600 540,000 Susquehanna Media Co. Sr. Sub. Notes 8.50%, 5/15/09 B1 150 148,500 Time Warner Telecom, LLC Sr. Notes 9.75%, 7/15/08 B2 $750 $693,750 Turner Broadcasting Systems, Inc. Sr. Notes 7.40%, 2/1/04 Baa1 65 66,676 United International Holdings, Inc. Series B, Sr. Discount Notes 0.00%, 2/15/08 (3) B3 1,950 809,250 Univision Network Holding L.P. Sub. Notes 7.00%, 12/17/02 N/R 2,073 2,798,650 Young Broadcasting, Inc. Series B, Gtd. Sr. Sub. Notes 8.75%, 6/15/07 B2 1,315 1,198,294 Group Total 11,946,347 Business Services (1.1%) General Binding Corp. Gtd. Sr. Sub. Notes 9.375%, 6/1/08 Caa1 500 367,500 Iron Mountain, Inc. Sr. Sub. Notes 8.75%, 9/30/09 B2 700 691,250 La Petite Academy, Inc. Gtd. 10.00%, 5/15/08 B3 1,250 668,750 Maxxam Group Holdings, Inc. Series B, Sr. Notes 12.00%, 8/1/03 Caa1 700 556,500 Pentacon, Inc. Series A, Gtd. 12.25%, 4/1/09 B3 900 490,500 Werner Holdings Series A, Gtd. 10.00%, 11/15/07 B2 450 416,250 Group Total 3,190,750 Cable (9.6%) Adelphia Communications Corp. Series B, Sr. Notes 8.375%, 2/1/08 B2 1,000 865,000 Alliance Atlantis Communications Corp. Yankee Sr Sub. Notes 13.00%, 12/15/09 B2 500 498,125 CSC Holdings, Inc.: Sr. Sub. Notes 9.875%, 5/15/06 Ba3 400 410,000 Series B, Sr. Sub. Debentures 8.125%, 8/15/09 9.875%, 2/15/13 Ba1 $350 $357,201 Ba3 1,100 1,133,000 Cablevision S.A. Bonds 13.75%, 5/1/09 B1 330 241,725 Century Communications Corp.: Series B, Sr. Notes 0.00%, 1/15/08 B2 650 253,500 Sr. Notes 9.75%, 2/15/02 B2 500 491,250 8.75%, 10/1/07 B2 650 559,813 Charter Communications Holdings: Sr. Notes 8.625%, 4/1/09 10.25%, 1/15/10 (1) B2 750 684,375 B2 1,050 1,029,000 Sr. Discount Notes 0.00%, 4/1/11 (3) B2 1,300 757,250 Classic Cable, Inc. Series B, Gtd. 9.375%, 8/1/09 Caa1 650 295,750 Coaxial Communications, Inc. Gtd. Notes 10.00%, 8/15/06 B3 1,250 1,195,313 Comcast UK Cable Partners, Ltd. Yankee Sr. Debentures 0.00%, 11/15/07 (3) B2 500 427,500 DIVA Systems Corp. Series B, Sr. Discount Notes 0.00%, 3/1/08 (3) N/R 3,885 1,612,275 Diamond Cable Communications plc Yankee Discount Notes 0.00%, 12/15/05 (3) Caa1 1,800 1,620,000 James Cable Partners L.P. Series B, Sr. Notes 10.75%, 8/15/04 Caa 1,800 1,143,000 Jones Intercable, Inc. Sr. Notes 7.625%, 4/15/08 Baa2 1,150 1,185,423 Lenfest Communications, Inc.: Sr. Notes 8.375%, 11/1/05 Baa2 500 535,421
- 2 - PRO FORMA PORTFOLIO OF INVESTMENTS OF COMBINED FUND December 31, 2000
CGF CGF --------------- ----------------- Moody's Face Face Face Ratings Amount Amount Amount (Unaudited) (000) Value (000) Value (000) Value ----------- ------ ----- ------ ----- ------ ----- 10.50%, 6/15/06 Baa3 1,250 1,447,280 8.25%, 2/15/08 Baa3 200 207,544 Mediacom LLC/Capital Corp. Sr. Notes 7.875%, 2/15/11 B2 850 720,375 NTL Communications Corp.: Series B, Sr. Notes 0.00%, 10/1/08 (3) B2 1,750 953,750 11.50%, 10/1/08 B2 600 532,500 NTL, Inc.: Sr. Notes Series A, 0.00%, 4/15/05 (3) B2 $1,000 $945,000 Series B, Sr. Notes 0.00%, 2/1/06 (3) B2 1,550 1,356,250 10.00%, 2/15/07 B2 750 650,625 Northland Cable Television Sr. Sub. Notes 10.25%, 11/15/07 B3 750 506,250 Olympus Communications, L.P./ Olympus Capital Corp. Series B, Sr. Notes 10.625%, 11/15/06 B2 1,250 1,156,250 Renaissance Media Group Sr. Discount Notes 0.00%, 4/15/08 (3) B3 1,000 688,750 Rogers Cablesystems, Ltd. Gtd. 10.00%, 12/1/07 Baa3 700 738,500 Rogers Communications, Inc. Sr. Notes 8.875%, 7/15/07 Ba2 200 199,000 Telewest Communications plc Yankee Sr. Sub. Discount Debentures 0.00%, 10/1/07 (3) B1 2,100 1,879,500 Group Total 27,276,495 Chemicals (1.5%) Applied Extrusion Technologies Series B, Sr. Notes 11.50%, 4/1/02 B2 1,500 885,000 Huntsman Corp. Sr. Sub. Notes 9.50%, 7/1/07 (1) B2 1,050 635,250 Huntsman Polymers Corp. Sr. Notes 11.75%, 12/1/04 B1 1,150 891,250 Laroche Industries, Inc. Series B, Sr. Sub. Notes 9.50%, 9/15/07 (2) Ca 400 22,000 Lyondell Chemical Co. Series B, Secured Notes 9.875%, 5/1/07 Ba3 750 729,375 NL Industries, Inc. Sr. Secured Notes 11.75%, 10/15/03 B1 317 321,755 Philipp Brothers Chemicals, Inc. Gtd. 9.875%, 6/1/08 B3 150 108,750 Sterling Chemical Holdings, Inc. Sr. Secured Discount Notes 0.00%, 8/15/08 (3) Caa1 $1,000 $110,000 Sterling Chemicals, Inc. Sr. Sub. Notes 11.75%, 8/15/06 B3 434 210,490 Texas Petrochemical Corp. Series B, Sr. Sub. Notes 11.125%, 7/1/06 Caa1 600 456,000 Group Total 4,369,870 Construction & Building Materials(1.6%) AFC Enterprises Sr. Sub. Notes 10.25%, 5/15/07 B2 500 472,500 American Architectural Products Corp. Gtd. Sr. Notes 11.75%, 12/1/07 (2) Ca 1,400 371,000 Brand Scaffold Services, Inc. Sr. Notes 10.25%, 2/15/08 B3 400 361,499 Collins & Aikman Floor Coverings, Inc. Series B, Sr. Sub. Notes 10.00%, 1/15/07 B2 1,250 1,030,000 D.R. Horton, Inc. Sr. Sub. Notes 9.75%, 9/15/10 Ba3 150 141,750 Dayton Superior Corp. Gtd. 13.00%, 6/15/09 B3 1,250 1,131,250 International Utility Structures, Inc. Yankee Sr. Sub. Notes 10.75%, 2/1/08 Caa1 650 445,250 MMI Products, Inc. Series B, Sr. Sub. Notes 11.25%, 4/15/07 B2 250 245,000 Presley Companies Sr. Notes 12.50%, 7/1/01 Caa3 250 233,750 Group Total 4,431,999
- 3 - PRO FORMA PORTFOLIO OF INVESTMENTS OF COMBINED FUND December 31, 2000
CGF CGF --------------- ----------------- Moody's Face Face Face Ratings Amount Amount Amount (Unaudited) (000) Value (000) Value (000) Value ----------- ------ ----- ------ ----- ------ ----- Consumer Products & Services (2.5%) Coinstar, Inc. Sr. Discount Notes 13.00%, 10/1/06 N/R 2,050 2,111,500 Doskocil Manufacturing Co., Inc. Gtd. Sr. Sub. Notes 10.125%, 9/15/07 B3 500 127,500 Drypers Corp. Series B, Sr. Notes 10.25%, 6/15/07 Ca $400 $35,000 Fort James Corp. Sr. Notes 6.234%, 3/15/01 Baa3 45 44,814 Holmes Products Corp. Gtd. Sr. Sub. Notes 9.875%, 11/15/07 B3 1,000 445,000 Indesco International, Inc. Gtd. Sr. Sub. Notes 9.75%, 4/15/08 (2) B3 600 117,000 Jordan Industries, Inc. Series B, Sr. Notes 10.375%, 8/1/07 B3 1,375 1,161,875 Jostens, Inc. Sr. Sub. Notes 12.75%, 5/1/10 (1) B3 900 814,500 Knology Holdings, Inc. Sr. Discount Notes 0.00%, 10/15/07 (3) N/R 1,250 243,750 Packaged Ice, Inc. Gtd. Sr. Notes 9.75%, 2/1/05 B3 100 79,500 Playtex Products, Inc. Series B, Gtd. Sr. Notes 8.875%, 7/15/04 B1 425 405,875 Scotts Co. Sr. Sub. Notes 8.625%, 1/15/09 (1) B2 750 731,250 Sealy Mattress Co. Gtd. Sr. Sub. Notes 9.875%, 12/15/07 B3 200 194,000 United Rentals, Inc. Sr. Sub. Notes 9.25%, 1/15/09 B1 750 573,750 Group Total 7,085,314 Electronics (1.0%) Aavid Thermal Technologies, Inc. Gtd. 12.75%, 2/1/07 B2 150 128,250 Condor Systems, Inc. Gtd. 11.875%, 5/1/09 B3 650 430,625 Details, Inc. Series B, Sr. Sub. Notes 10.00%, 11/15/05 B3 750 693,750 Metromedia Fiber Network, Inc. Series B, Sr. Notes 10.00%, 11/15/08 B2 250 208,750 Numatics, Inc. Series B, Gtd. 9.625%, 4/1/08 B3 200 125,000 Unisys Corp.: Sr. Notes 11.75%, 10/15/04 Ba1 325 344,500 7.875%, 4/1/08 Ba1 250 233,125 Viasystems, Inc.: Sr. Sub. Notes 9.75%, 6/1/07 B3 650 518,375 Series B, Sr. Sub. Notes 9.75%, 6/1/07 B3 $150 $119,625 Group Total 2,802,000 Energy (7.2%) AES Corp. Sr. Notes 9.50%, 6/1/09 Ba1 250 260,000 Abraxas Petroleum Corp. Series D, Sr. Notes. 11.50%, 11/1/04 Caa3 1,454 1,301,330 Bellwether Exploration Co. Gtd. Sr. Sub. Notes 10.875%, 4/1/07 B3 1,500 1,432,500 CMS Energy Corp. Sr. Notes 7.50%, 1/15/09 Ba3 250 229,632 CMS Energy/Atlantic Methanol Secured Notes 10.875%, 12/15/04 (1) B1 250 251,250 Calpine Corp. Sr. Notes 7.75%, 4/15/09 Ba1 700 653,189 Canadian Forest Oil Ltd. Gtd. Sr. Sub. Notes 8.75%, 9/15/07 B2 750 740,625 Clark R & M, Inc. Sr. Notes 8.625%, 8/15/08 Ba3 350 264,250 Cliffs Drilling Co. Series D, Gtd. Sr. Notes 10.25%, 5/15/03 Ba3 1,350 1,375,312 Cogentrix Energy, Inc. Gtd. Unsecured Notes 8.75%, 10/15/08 Baa3 1,000 1,021,839 Conoco, Inc. Sr. Notes 5.90%, 4/15/04 A3 220 217,976 Continental Resources Gtd. Sr. Notes 10.25%, 8/1/08 Caa1 400 349,000 Contour Energy Co. Gtd. 14.00%, 4/15/03 B3 1,219 1,273,855 Dominion Resources, Inc. Sr. Notes 8.125%, 6/15/10 Baa1 185 200,160
- 4 - PRO FORMA PORTFOLIO OF INVESTMENTS OF COMBINED FUND December 31, 2000
CGF CGF --------------- ----------------- Moody's Face Face Face Ratings Amount Amount Amount (Unaudited) (000) Value (000) Value (000) Value ----------- ------ ----- ------ ----- ------ ----- Duke Energy Field Services: Notes 7.50%, 8/16/05 Baa2 115 119,799 7.875%, 8/16/10 Baa2 90 96,094 El Paso Energy Corp. Sr. Notes 6.75%, 5/15/09 Baa2 255 251,784 Energy Corp. of America Series A, Sr. Sub. Notes 9.50%, 5/15/07 Caa1 250 199,375 FPL Group Capital, Inc. Gtd. 6.875%, 6/1/04 A2 $380 $385,521 Frontier Oil Corp. Series A, Sr. Notes 9.125%, 2/15/06 B2 200 178,250 11.75%, 11/15/09 B2 1,050 1,046,063 Giant Industries, Inc. Gtd. Sr. Sub. Notes 9.00%, 9/1/07 B2 500 457,500 Gothic Production Corp. Series B, Gtd. Sr. Secured Notes 11.125%, 5/1/05 B3 800 860,000 H.S. Resources, Inc.: Sr. Sub. Notes 9.875%, 12/1/03 B2 500 507,500 Gtd. Sr. Sub. Notes 9.25%, 11/15/06 B2 850 858,500 Key Energy Services, Inc. Sr. Sub. Notes 14.00%, 1/15/09 B3 1,500 1,710,000 KeySpan Corp. Notes 7.25%, 11/15/05 A3 185 192,502 Keyspan Gas East Unsub. Notes 7.875%, 2/1/10 A2 230 247,247 Nuevo Energy Co. Series B, Sr. Sub. Notes 9.50%, 6/1/08 B1 150 152,250 Occidental Petroleum Corp. Sr. Notes 7.375%, 11/15/08 Baa3 140 144,029 Ocean Energy, Inc. Series B, Gtd. 8.375%, 7/1/08 Ba3 150 153,375 Pacific Gas & Electric Co. Sr. Notes 7.375%, 11/1/05 (1) A2 55 45,952 Parker Drilling Co. Series D, Gtd. 9.75%, 11/15/06 B1 750 757,500 Phillips Petroleum Co.: Notes 8.50%, 5/25/05 Baa2 35 37,893 8.75%, 5/25/10 Baa2 55 62,922 Plains Resources, Inc. Series B, Gtd. Sr. Sub. Notes 10.25%, 3/15/06 B2 375 376,875 Southwest Royalties, Inc. Series B, Gtd. Sr. Notes 10.50%, 10/15/04 Caa 1,300 1,108,250 Triton Energy, Ltd. Sr. Notes 8.875%, 10/1/07 Ba3 200 203,250 Wiser Oil Co. Gtd. Sr. Sub. Notes 9.50%, 563,500 5/15/07 Caa3 $700 $20,286,849 Group Total Entertainment (2.1%) Ackerley Group, Inc. Series B, Sr. Sub. Notes 9.00%, 1/15/09 B2 250 220,000 American Skiing Co. Series B, Sr. Sub. Notes 12.00%, 7/15/06 Caa3 625 503,125 Bally Total Fitness Holdings Series D, Sr. Sub. Notes 9.875%, 10/15/07 B3 500 466,250 Booth Creek Ski Holdings, Inc. Series B, Sr. Sub. Notes 12.50%, 3/15/07 Caa1 1,250 918,750 Cinemark U.S.A., Inc. Series D, Sr. Sub. Notes 9.625%, 8/1/08 Caa 450 294,750 KSL Recreation Group, Inc. Series B, Sr. Sub. Notes 10.25%, 5/1/07 B2 430 423,550 Loews Cineplex Sr. Sub. Notes 8.875%, 8/1/08 B3 900 139,500 Outboard Marine Corp. Series B, Gtd. Sr. Notes 10.75%, 6/1/08 B3 500 102,500 PTI Holdings, Inc. Sub. Notes 7.00%, 12/17/02 N/R 507 684,335 Premier Parks, Inc. Sr. Notes 9.75%, 6/15/07 B3 150 146,250 Production Resource Group, LLC/PRG Finance Group Gtd. Sr. Sub. Notes 11.50%, 1/15/08 N/R 1,000 505,000 Regal Cinemas, Inc.: Sr. Sub. Notes 9.50%, 6/1/08 Ca 1,450 97,875 8.875%, 12/15/10 Ca 250 16,875 Silver Cinemas, Inc. Sr. Sub. Notes 10.50%, 4/15/05 (2) Caa1 1,900 152,000 Time Warner, Inc.: Debentures 7.48%, 1/15/08 Baa1 210 215,460
- 5 - PRO FORMA PORTFOLIO OF INVESTMENTS OF COMBINED FUND December 31, 2000
CGF CGF --------------- ----------------- Moody's Face Face Face Ratings Amount Amount Amount (Unaudited) (000) Value (000) Value (000) Value ----------- ------ ----- ------ ----- ------ ----- Notes 8.11%, 8/15/06 Baa1 60 63,722 Yanknets LLC/ Yanknets CP Sr. Notes 12.75%, 3/1/07 (1)(5) B1 1,050 1,018,500 Group Total 5,968,442 Financial Services (2.6%) Allstate Corp. Sr. Notes 7.875%, 5/1/05 A1 $135 $142,862 Associates Corp. Sr. Notes 6.25%, 11/1/08 A1 400 386,286 Bank of America Corp. Notes 7.875%, 5/16/05 Aa2 100 105,644 Sub. Notes 7.80%, 2/15/10 Aa3 345 359,657 Chase Manhattan Corp. Sub. Notes 7.00%, 11/15/09 A1 260 259,245 Citicorp Series F, Sub. Notes 6.375%, 11/15/08 A1 140 136,216 Citigroup, Inc. Sub. Notes 7.25%, 10/1/10 Aa3 100 103,217 Conseco Finance Trust III Bonds 8.796%, 4/1/27 Caa 55 21,175 Conseco, Inc.: Notes 6.40%, 2/10/03 B1 155 118,575 9.00%, 10/15/06 B1 100 70,000 Duke Capital Corp. Sr. Notes 7.25%, 10/1/04 A3 405 417,605 ERAC USA Finance Co. Notes 7.95%, 12/15/09 (1) Baa1 50 49,631 Enron Corp. Notes 7.875%, 6/15/03 Baa1 60 62,002 Finova Capital Corp.: Notes 6.55%, 11/15/02 Baa1 155 94,990 7.25%, 11/8/04 Baa1 135 81,143 Ford Motor Credit Co. Notes 7.875%, 6/15/10 A2 290 299,341 GE Global Insurance Notes 7.50%, 6/15/10 Aa1 355 378,485 General Electric Capital Corp. Notes 7.00%, 2/3/03 Aaa 375 382,901 General Motors Acceptance Corp. Notes 7.50%, 7/15/05 A2 $375 $384,315 Goldman Sachs Group, Inc. Sr. Unsub. Notes 7.80%, 1/28/10 A1 175 184,333 Hanvit Bank Sub. Notes 11.75%, 3/1/10 Ba3 150 146,390 John Hancock Global Funding II Notes 7.90%, 7/2/10 (1) Aa2 240 259,728 Lehman Brothers Holdings, Inc.: Notes 6.625%, 4/1/04 A2 50 49,871 8.25%, 6/15/07 A2 60 63,027 Madison River Capital/ Finance Sr. Notes 13.25%, 3/1/10 Caa1 1,500 982,500 Morgan Stanley Dean Witter & Co. Notes 7.75%, 6/15/05 Aa3 95 99,919 Potomac Capital Investment Corp. Notes 7.55%, 11/19/01 (1) A3 150 151,863 Sovereign Bancorp Sr. Notes 10.50%, 11/15/06 Ba3 250 247,500 US West Cap Funding, Inc. Gtd. 6.875%, 8/15/01 (1) Baa1 120 120,302 Wells Fargo & Co.: Sr. Notes 7.25%, 8/24/05 Aa2 180 187,498 Subordinated 7.55%, 6/21/10 Aa2 100 106,016 Westfed Holdings Sr. Debentures 15.50%, 9/15/99 (2) N/R 2,000 680,000 Windsor Woodmont Black Hawk Units 13.00%, 3/15/05 N/R 200 198,000 Group Total 7,330,237 Food & Beverages (1.9%) Archibald Candy Corp. Gtd. Sr. Secured Notes 10.25%, 7/1/04 B3 1,250 618,750 Aurora Foods, Inc. Series B, Sr. Sub. Notes 9.875%, 2/15/07 Caa1 1,150 825,125 B & G Foods, Inc. Gtd. 9.625%, 8/1/07 B3 $700 $453,250
- 6 - PRO FORMA PORTFOLIO OF INVESTMENTS OF COMBINED FUND December 31, 2000
CGF CGF --------------- ----------------- Moody's Face Face Face Ratings Amount Amount Amount (Unaudited) (000) Value (000) Value (000) Value ----------- ------ ----- ------ ----- ------ ----- Carrols Corp. Gtd. 9.50%, 12/1/08 B3 150 97,875 Eagle Family Foods Series B, Gtd. Sr. Notes 8.75%, 1/15/08 B3 450 227,250 Fleming Companies, Inc. Sr. Sub. Notes 10.50%, 12/1/04 B3 900 702,000 Kroger Co. Sr. Notes 7.625%, 9/15/06 Baa3 400 416,412 Premier International Foods, plc Sr. Notes 12.00%, 9/1/09 B3 1,400 1,155,000 Stater Brothers Holdings, Inc. Sr. Notes 10.75%, 8/15/06 B2 750 618,750 Vlasic Foods International, Inc. Sr. Sub. Notes 10.25%, 7/1/09 C 650 146,250 Group Total 5,260,662 Health Care (1.3%) American General Corp. Notes 7.50%, 8/11/10 A2 65 68,275 ICN Pharmaceutical Sr. Notes 8.75%, 11/15/08 Ba3 750 753,750 Icon Health & Fitness, Inc. Gtd. 12.00%, 9/27/05 N/R 222 122,100 Insight Health Services Corp. Gtd. Sr. Sub. Notes 9.625%, 6/15/08 B3 $200 $187,000 Meditrust Conv. Debentures 7.50%, 3/1/01 B2 2,000 1,950,000 Paracelsus Healthcare Sr. Sub. Notes 10.00%, 8/15/06 (2) B3 750 300,000 Unilab Finance Corp. Sr. Sub. Notes 12.75%, 10/1/09 (1) B3 150 163,500 Group Total 3,544,625 Industrial Goods & Materials (1.8%) AAF-McQuay, Inc. Sr. Notes 8.875%, 2/15/03 N/R 150 129,750 APCOA, Inc. Gtd. Sr. Notes 9.25%, 3/15/08 Caa1 430 144,050 Applied Extrusion Technologies Corp. Sr. Notes 11.50%, 4/1/02 B2 250 147,500 Atlantis Plastics, Inc. Sr. Notes 11.00%, 2/15/03 N/R 835 571,975 CLARK Material Handling Co. Gtd. Sr. Notes 10.75%, 11/15/06 (2) B1 550 30,938 Elgar Holdings Corp. Gtd. 9.875%, 2/1/08 B2 $200 $130,000 GSI Group, Inc. Gtd. 10.25%, 11/1/07 B2 150 114,750 Haynes International, Inc. Sr. Notes 11.625%, 9/1/04 Caa1 750 528,750 Holley Performance Products Sr. Notes 12.25%, 9/15/07 (1) B3 750 401,250 International Knife & Saw, Inc. Sr. Sub. Notes 11.375%, 11/15/06 B3 750 373,125 Jackson Products, Inc. Series B, Gtd. 9.50%, 4/15/05 B3 100 86,500 Motors & Gears, Inc. Series D, Sr. Notes 10.75%, 11/15/06 B3 1,700 1,521,500 Neenah Corp. Series B, Sr. Sub. Notes 11.125%, 5/1/07 B3 250 182,500 Park-Ohio Industries, Inc. Sr. Sub. Notes 9.25%, 12/1/07 B2 600 453,000 Thermadyne Manufacturing, LLC/ Thermadyne Capital Corp. Gtd. Sr. Sub. Notes 0.00%, 6/1/08 (3) B3 975 190,500 Thermadyne Holdings Corp. Sr. Discount Notes 9.875%, 6/1/08 Caa1 300 14,625 Group Total 5,020,713 Medical (0.1%) Triad Hospitals Holdings Series B, Gtd. 11.00%, 5/15/09 B3 200 212,250 Metals & Mining (1.6%) AK Steel Corp. Sr. Notes 9.125%, 12/15/06 Ba2 250 239,375
- 7 - PRO FORMA PORTFOLIO OF INVESTMENTS OF COMBINED FUND December 31, 2000
CGF CGF --------------- ----------------- Moody's Face Face Face Ratings Amount Amount Amount (Unaudited) (000) Value (000) Value (000) Value ----------- ------ ----- ------ ----- ------ ----- Alcoa, Inc. Notes 7.375%, 8/1/10 A1 155 164,078 Algoma Steel, Inc. Yankee First Mortgage Notes 12.375%, 7/15/05 B2 1,250 446,875 Bayou Steel Corp. First Mortgage Notes 9.50%, 5/15/08 B2 500 178,750 GS Technologies Operating Co. Sr. Notes 12.00%, 9/1/04 Ca 675 23,625 Kaiser Aluminum & Chemical Corp. Series D, Sr. Notes 10.875%, 10/15/06 B2 675 529,875 Lodestar Holdings, Inc. Sr. Notes 11.50%, 5/15/05 (2) Caa2 800 74,000 Metallurg, Inc. Series B, First Mortgage Gtd. Sr. Notes 11.00%, 12/1/07 B3 $1,200 $966,000 National Steel Corp. Series D, First Mortgage Bonds 9.875%, 3/1/09 B2 1,000 405,000 Sheffield Steel Corp. Series B, First Mortgage Bonds 11.50%, 12/1/05 Caa 1,000 455,000 WCI Steel, Inc. Series B, Sr. Secured Notes 10.00%, 12/1/04 B2 1,175 840,125 Weirton Steel Corp. Sr. Notes 11.375%, 7/1/04 B2 700 290,500 Wheeling-Pittsburg Corp. Sr. Notes 9.25%, 11/15/07 (2) Caa3 1,000 37,500 Group Total 4,650,703 Packaging/Containers (2.6%) AEP Industries, Inc. Sr. Sub. Notes 9.875%, 11/15/07 B3 650 555,750 Amtrol, Inc. Sr. Sub. Notes 10.625%, 12/31/06 B3 600 480,000 BPC Holding Corp. Series B, Sr. Secured Notes 12.50%, 6/15/06 Caa3 1,090 594,200 BWAY Corp. Gtd. Sr. Sub. Notes 10.25%, 4/15/07 B2 150 138,000 Berry Plastics Corp. Series B, Gtd. 11.00%, 7/15/07 (1) B3 150 108,750 Container Corp. of America Gtd. Sr. Notes 9.75%, 4/1/03 B2 750 753,750 Crown Packaging Enterprises, Ltd. Yankee Sr. Secured Discount Notes 0.00%, 8/1/06 (3) Ca 3,375 338 Fonda Group, Inc. Sr. Sub. Notes 9.50%, 3/1/07 B3 1,000 785,000 Four M Corp. Series B, Sr. Notes 12.00%, 6/1/06 Caa2 500 482,500 Gaylord Container Corp. Series B, Sr. Notes 9.75%, 6/15/07 Caa1 950 603,250 Huntsman Packaging Corp. Gtd. 13.00%, 6/1/10 B3 $1,000 $560,000 Owens-Illinois, Inc. Sr. Note 8.10%, 5/15/07 B1 1,250 681,250 Radnor Holdings, Inc. Series B, Gtd. Sr. Notes 10.00%, 12/1/03 B2 900 770,625 Stone Container Finance Co. Yankee Gtd. Sr. Notes 11.50%, 8/15/06 B2 780 811,200 Group Total 7,324,613 Paper & Forest Products (2.6%) Abitibi-Consolidated, Inc. Yankee Bonds 8.55%, 8/1/10 Baa3 270 272,052 Ainsworth Lumber Co., Ltd. Yankee Sr. Secured Notes 12.50%, 7/15/07 B2 2,150 1,773,750 American Tissue, Inc. Series B, Gtd. 12.50%, 7/15/06 B3 340 273,700 Color Spot Nurseries Sr. Sub. Notes 10.50%, 12/15/07 Caa 1,200 462,000 Crown Paper Co. Sr. Sub. Notes 11.00%, 9/1/05 (2) B3 1,050 81,375 Doman Industries, Ltd. Yankee Sr. Notes 8.75%, 3/15/04 Caa1 400 252,500 QUNO Corp. Yankee Sr. Notes 9.125%, 5/15/05 Baa3 315 329,289 Repap New Brunswick, Inc. Sr. Secured Debentures 10.625%, 4/15/05 Ba2 1,000 1,036,250 Riverwood International Corp. Gtd. Sr. Notes 10.875%, 4/1/08 Caa1 1,150 1,040,750 SD Warren Co. Debentures 14.00%, 12/15/06 Ba3 1,598 1,740,920 Group Total 7,262,586
- 8 - PRO FORMA PORTFOLIO OF INVESTMENTS OF COMBINED FUND December 31, 2000
CGF CGF --------------- ----------------- Moody's Face Face Face Ratings Amount Amount Amount (Unaudited) (000) Value (000) Value (000) Value ----------- ------ ----- ------ ----- ------ ----- Publishing & Information Services (2.2%) American Lawyer Media Holdings, Inc. Gtd. Sr. Notes 9.75%, 12/15/07 B2 600 528,000 American Media Operation Sr. Sub. Notes 10.25%, 5/1/09 (1) B2 250 244,375 Ampex Corp. Series B, Sr. Notes 12.00%, 3/15/03 N/R 1,000 500,000 Earthwatch, Inc. Sr. Discount Notes 13.00%, 7/15/07 N/R 1,150 810,750 Hollinger International Publishing Gtd. Sr. Notes 9.25%, 3/15/07 Ba3 1,150 1,155,750 Lamar Advertising Co. Gtd. Sr. Sub. Notes 9.625%, 12/1/06 B1 250 258,750 Liberty Group Operating Gtd. 9.375%, 2/1/08 Caa1 100 75,500 Liberty Group Publishing, Inc. Sr. Discount Debentures 0.00%, 2/1/09 (3) Caa 900 445,500 Mentus Media Corp. Units 12.00%, 2/1/03 N/R 2,258 903,544 Premier Graphics, Inc. Gtd. 11.50%, 12/1/05 (2) Caa3 2,000 70,000 Printpack, Inc. Series B, Sr. Sub. Notes 10.625%, 8/15/06 Caa1 300 283,500 Tri-State Outdoor Media Sr. Notes 11.00%, 5/15/08 N/R 1,323 1,012,095 Group Total 6,287,764 Real Estate (0.2%) Bluegreen Corp. Gtd. Sr. Secured Notes 10.50%, 4/1/08 B3 1,200 642,000 EOP Operating, L.P. Sr. Notes 6.375%, 2/15/03 Baa1 65 64,541 Group Total 706,541 Restaurants, Hotels & Gaming (6.5%) AFC Enterprises Sr. Sub. Notes 10.25%, 5/15/07 B2 150 141,750 American Restaurant Group, Inc. Gtd. Sr. Secured Notes 11.50%, 2/15/03 B3 899 813,595 AmeriKing, Inc. Sr. Notes 10.75%, 12/1/06 B3 250 101,250 Argosy Gaming Co. Gtd 10.75%, 6/1/09 B2 100 104,750 Autotote Corp. Sr. Sub. Notes 12.25%, 8/15/10 (1) B3 1,065 1,006,425 Aztar Corp. Sr. Sub. Notes 8.875%, 5/15/07 B2 750 727,500 Boyd Gaming Corp. Sr. Sub. Notes 9.50%, 7/15/07 B1 400 356,000 CapStar Hotel Co. Sr. Sub. Notes 8.75%, 8/15/07 Ba3 375 349,688 Coast Hotels & Casinos, Inc. Gtd. 9.50%, 4/1/09 B3 700 681,625 Fitzgeralds Gaming Corp. Series B, Gtd. Sr. Notes 12.25%, 12/15/04 (2) Caa3 700 423,500 Friendly Ice Cream Corp. Gtd. Sr. Notes 10.50%, 12/1/07 B3 1,050 614,250 HMH Properties Series B, Gtd. Sr. Notes 7.875%, 8/1/08 Ba2 750 723,750 Hard Rock Hotel, Inc. Sr. Sub. Notes 9.25%, 4/1/05 Caa 1,800 1,611,000 Hollywood Park, Inc. Series B, Gtd. Sr. Sub. Notes 9.50%, 8/1/07 B2 875 888,125 Horseshoe Gaming Holdings: Series B, Sr. Sub. Notes 9.375%, 6/15/07 B2 1,050 1,057,875 8.625%, 5/15/09 B2 1,000 983,751 ITT Corp. Notes 6.75%, 11/15/05 Ba1 45 43,770 Intrawest Corp. Sr. Notes 9.75%, 8/15/08 B1 250 252,500 Isle of Capri Casinos, Inc. Sr. Sub. Notes 8.75%, 4/15/09 B2 700 623,000 Jazz Casino Co. LLC Sr. Sub. Notes 5.987%, 11/15/09 (8) N/R 159 18,303 Lodgian Financing Corp. Sr. Sub. Notes 12.25%, 7/15/09 B3 500 452,500 MGM Mirage, Inc. Gtd. 8.50%, 9/15/10 Baa3 280 292,471
- 9 - PRO FORMA PORTFOLIO OF INVESTMENTS OF COMBINED FUND December 31, 2000
CGF CGF --------------- ----------------- Moody's Face Face Face Ratings Amount Amount Amount (Unaudited) (000) Value (000) Value (000) Value ----------- ------ ----- ------ ----- ------ ----- Majestic Star Casino, LLC Secured Notes 10.875%, 7/1/06 (1) B2 750 648,750 Mandalay Resort Group Sr. Sub. Notes 9.25%, 12/1/05 Ba3 $300 $294,000 Mohegan Tribal Gaming Authority Sr. Notes 8.125%, 1/1/06 Ba2 1,100 1,108,250 Park Place Entertainment Corp. Sr. Sub Notes 9.375%, 2/15/07 (1) Ba2 750 763,125 Prime Hospitality Corp. Secured First Mortgage Notes 9.25%, 1/15/06 Ba2 1,100 1,122,000 Romacorp, Inc. Sr. Notes 12.00%, 7/1/06 B3 1,000 496,251 Station Casinos Sr. Sub. Notes 9.75%, 4/15/07 B1 1,615 1,643,263 Group Total 18,343,017 Retail (3.4%) Advance Holdings Corp. Series B, Sr. Discount Debentures 0.00%, 4/15/09 (3) Caa1 1,850 638,250 Advance Stores Co. Gtd. Sr. Sub. Notes 10.25%, 4/15/08 B3 1,250 943,750 Buhrmann US, Inc. Gtd. 12.25%, 11/1/09 B2 500 505,000 Dairy Mart Convenience Stores, Inc. Sr. Sub. Notes 10.25%, 3/15/04 B3 526 302,450 Finlay Enterprises, Inc. Sr. Debentures 9.00%, 5/1/08 B2 400 350,000 Finlay Fine Jewelry Corp. Gtd. Sr. Notes 8.375%, 5/1/08 Ba3 1,050 939,750 Flooring America, Inc. Series B, Gtd. 9.25%, 10/15/07 (2) C 703 17,566 Jo-Ann Stores, Inc. Sr. Sub. Notes 10.375%, 5/1/07 B2 250 151,250 Kmart Corp. Debentures 7.75%, 10/1/12 Baa3 $1,375 $986,716 Levi Strauss & Co. Notes 7.00%, 11/1/06 Ba3 1,250 987,500 Mrs. Fields Holding, Co. Sr. Discount Notes 14.00%, 12/1/05 Caa2 2,250 1,046,250 Mrs. Fields Original Cookies, Inc. Gtd. Sr. Notes 10.125%, 12/1/04 (1) B2 1,650 1,419,000 Pantry, Inc. Sr. Sub. Notes 10.25%, 10/15/07 B3 750 708750 Safelite Glass Corp. Series B, Sr. Sub. Notes 9.875%, 12/15/06 N/R 2,000 25,000 Saks, Inc.: Gtd. 7.00%, 7/15/04 Baa3 90 65,250 8.25%, 11/15/08 Baa3 80 48,400 Target Corp. Notes 7.50%, 8/15/10 A2 105 110,908 Wal-Mart Stores, Inc.: Sr. Notes 6.55%, 8/10/04 Aa2 250 255,745 6.875%, 8/10/09 Aa2 215 225,189 Group Total 9,726,724 Telecommunications (16.6%) AMSC Acquisition Co., Inc. Series B, Gtd. Sr. Notes 12.25%, 4/1/08 N/R 150 56,250 AT&T Corp. Notes 5.625%, 3/15/04 A2 45 43,012 6.00%, 3/15/09 A2 70 62,478 Alamosa PCS Holdings, Inc. Gtd. 0.00%, 2/15/10 (3) Caa1 600 282,000 Asia Global Crossings, Ltd. Sr. Notes 13.375%, 10/15/10 (1) B2 1,250 1,084,375 British Telecom plcNotes 7.625%, 12/15/05 A2 50 50,649 Carrier1 International SA Sr. Notes 13.25%, 2/15/09 B3 300 210,000 COLT Telecom Group, plc Yankee Units 0.00%, 12/15/06 (3) B1 400 704,000 COX Communications, Inc. Notes 7.75%, 11/1/10 Baa2 $215 $223,661 Call-Net Enterprises, Inc. Sr. Discount Notes 0.00%, 5/15/09 (3) B2 500 102,500 CenturyTel, Inc. Sr. Notes 8.375%, 10/15/10 Baa2 55 57,386 Colo.Com Units 13.875%, 3/15/10 N/R 600 381000
- 10 - PRO FORMA PORTFOLIO OF INVESTMENTS OF COMBINED FUND December 31, 2000
CGF CGF --------------- ----------------- Moody's Face Face Face Ratings Amount Amount Amount (Unaudited) (000) Value (000) Value (000) Value ----------- ------ ----- ------ ----- ------ ----- Concentric Network Corp. Units 12.75%, 12/15/07 N/R 1,000 855,000 DTI Holdings, Inc. Units 0.00%, 3/1/08 (3) N/R 2,150 585,875 Dobson/Sygnet Communications, Co. Sr. Notes 12.25%, 12/15/08 B3 1,550 1,534,500 Dolphin Telecom plc: Sr. Discount Notes 0.00%, 11/1/05 (3) Caa 250 36,250 0.00%, 6/1/08 Caa 750 108,750 Series B, Yankee Sr. Discount Notes 14.00%, 5/15/09 Caa 1,000 115,000 e. spire Communications, Inc. Sr. Discount Notes 0.00%, 11/1/05 (3) N/R 3,450 914,250 Energis, plc Sr. Unsub. Notes 9.75%, 6/15/09 (1) B1 100 91,500 Equinix, Inc. Sr. Notes 13.00%, 12/1/07 N/R 200 141,000 Exodus Communications, Inc. Sr. Notes 11.25%, 7/1/08 B3 600 537,000 Focal Communications Corp. Sr. Discount Notes 0.00%, 2/15/08 (3) B3 1,800 765,000 GST USA, Inc. Gtd. Sr. Discount Notes 0.00%, 12/15/05 (3) N/R 2,400 900,000 GT Group Telecom, Inc. Sr. Discount Notes 13.25%, 2/1/10 (1) Caa1 400 134,000 GTE Corp. Notes 7.51%, 4/1/09 A2 200 207,560 Global Crossing Holdings, Ltd. Gtd. Sr. Notes 9.625%, 5/15/08 Ba2 1,350 1,275,750 Globalstar, L.P./ Globalstar Capital Corp.: Sr. Notes 10.75%, 11/1/04 Caa1 1,300 169,000 11.25%, 6/15/04 Caa1 200 26,000 11.50%, 6/1/05 Caa1 500 65,000 Golden Sky DBS, Inc. Series B, Sr. Discount Notes 0.00%, 3/1/07 (3) Caa1 250 162,500 Hyperion Telecommunications, Inc. Series B, Sr. Discount Notes 0.00%, 4/15/03 (3) B3 450 317,250 ICG Holdings, Inc.: Gtd. Sr. Discount Notes 13.50%, 9/15/05 Ca 1,000 115,000 0.00%, 5/1/06 (3) Ca 855 98,325 0.00%, 3/15/07 (3) Ca 2,500 228,124 ICG Services, Inc.: Gtd. Sr. Discount Notes 0.00%, 2/15/08 (3) Ca 500 42,500 0.00%, 5/1/08 Ca 1,600 136,000 ITC Delta Com, Inc. Sr. Notes 11.00%, 6/1/07 B2 259 203,315 Innova S. de R.L. Sr. Notes 12.875%, 4/1/07 B3 385 339,763 Insight Midwest/Insight Capital: Sr. Notes 9.75%, 10/1/09 B1 900 897,750 10.50%, 11/1/10 B1 500 521,250 Interact Operating Co. Notes 14.00%, 8/1/03 (1) N/R 773 77 Intermedia Communications, Inc. Series B, Sr. Discount Notes 0.00%, 7/15/07 (3) B2 300 181,500 Sr. Notes 8.875%, 11/1/07 B2 450 246,750 KMC Telecom Holdings, Inc. Sr. Notes 13.50%, 5/15/09 Caa2 500 137,500 Level 3 Communication, Inc.: Sr. Notes 9.125%, 5/1/08 B3 1,325 1,076,562 Sr. Discount Notes 0.00%, 12/1/08 (3) B3 1,300 708,500 McLeod USA, Inc.: Sr. Discount Notes 0.00%, 3/1/07 (3) B1 900 751,500 11.50%, 5/1/09 B1 150 150,375 Sr. Notes 9.25%, 7/15/07 B1 600 552,000 9.50%, 11/1/08 B1 1,000 915,000 Metromedia Fiber Network, Inc. Series B, Sr. Notes 10.00%, 11/15/08 B2 500 417,500 Metromedia International Group Series B, Sr. Discount Notes 10.50%, 9/30/07 N/R 3,551 1,668,955 MetroNet Communications Corp.: Sr. Discount Notes 0.00%, 11/1/07 (3) Baa3 1,450 1,292,429
- 11 - PRO FORMA PORTFOLIO OF INVESTMENTS OF COMBINED FUND December 31, 2000
CGF CGF --------------- ----------------- Moody's Face Face Face Ratings Amount Amount Amount (Unaudited) (000) Value (000) Value (000) Value ----------- ------ ----- ------ ----- ------ ----- 0.00%, 6/15/08 Baa3 1,250 1,014,738 Microcell Telecommunications, Inc. Series B, Yankee Sr. Discount Notes 14.00%, 6/1/06 B3 770 739,200 Millicom International Cellular Yankee Sr. Sub. Discount Notes 0.00%, 6/1/06 (3) Caa1 1,150 908,500 NEXTLINK Communications, Inc.: Sr. Discount Notes 0.00%, 4/15/08 (3) B2 1,700 892,500 Sr. Notes 12.50%, 4/15/06 B2 450 407,250 10.75%, 11/15/08 B2 750 622,500 10.50%, 12/1/09 (1) B2 250 201,250 Nextel Communications, Inc. Sr. Discount Notes 0.00%, 2/15/08 (3) B1 2,580 1,889,850 Orange plc Sr. Notes 9.00%, 6/1/09 A1 100 103,250 Orbital Imaging Corp. Series B, Sr. Notes 11.625%, 3/1/05 N/R 500 77,500 Orion Network Systems, Inc. Gtd. Sr. Notes 11.25%, 1/15/07 B2 750 311,250 PSINet, Inc. Sr. Notes 11.50%, 11/1/08 B3 1,300 355,000 Pagemart Nationwide, Inc. Sr. Discount Notes 0.00%, 2/1/05 (3) B3 2,500 1,762,500 Pegasus Communications Corp. Series B, Sr. Notes 12.50%, 8/1/07 B3 1,000 1,030,000 Qwest Communications International, Inc. Sr. Discount Notes 0.00%, 10/15/07 (3) Baa1 1,350 1,238,299 Series B, 0.00%, 2/1/08 Baa1 250 218,466 RCN Corp.: Series B, Sr. Discount Notes 0.00%, 10/15/07 (3) B3 150 53,250 0.00%, 2/15/08 B3 1,200 390,000 Sr. Notes 10.125%, 1/15/10 B3 500 257,500 RSL Communications plc: Yankee Gtd. Sr. Notes 9.125%, 3/1/08 Caa3 450 20,250 10.50%, 11/15/08 Caa3 250 17,500 7.875%, 11/15/09 Caa3 1,100 77,000 Rhythms Netconnections, Inc.: Sr. Notes 12.75%, 4/15/09 B3 250 63,750 Series B, Sr. Discount Notes 0.00%, 5/15/08 (3) Caa1 1,750 218,750 Rogers Cablesystems, Ltd. Series B, Yankee Sr. Secured 2nd Priority Notes 10.00%, 3/15/05 Baa3 250 265,000 Rogers Cantel, Inc. Yankee Sr. Secured Debentures 9.375%, 6/1/08 Baa3 350 362,250 Sprint Capital Corp. Medium Term Notes 6.50%, 11/15/01 Baa1 300 300,722 Sprint Spectrum L.P./ Sprint Spectrum Finance Corp. Sr. Notes 11.00%, 8/15/06 Baa2 1,950 2,092,544 Star Choice Communications, Inc. Yankee Sr. Notes 13.00%, 12/15/05 B3 700 739,375 Startec Global Communications Corp. Units 12.00%, 5/15/08 N/R 1,100 664,126 T/SF Communications Corp. Series B, Gtd. Sr. Sub. Notes 10.375%, 11/1/07 B3 200 167,000 Telesystem International Wireless Series B, Sr. Discount Notes 13.25%, 6/30/07 Caa1 $500 $250,000 Teligent, Inc. Sr. Notes 11.50%, 12/1/07 Caa1 950 128,250 Tritel PCS, Inc. Sr. Discount Notes 0.00%, 5/15/09 (1)(3) B3 500 345,000 Triton PCS, Inc. Gtd. 0.00%, 5/1/08 (3) B3 1,100 874,500 US Unwired, Inc. Series B, Gtd. 13.375%, 11/1/09 (1) Caa1 1,100 506,000 Viatel, Inc.: Sr. Notes 11.25%, 4/15/08 Caa1 850 259,250 11.50%, 3/15/09 (1) B3 1,343 416,330 VoiceStream Wireless Sr. Notes 10.375%, 11/1/09 B2 800 861,000 WebLink Wireless, Inc. Sr. Discount Notes 0.00%, 2/1/08 Caa 300 69,000
- 12 - PRO FORMA PORTFOLIO OF INVESTMENTS OF COMBINED FUND December 31, 2000
CGF CGF --------------- ----------------- Moody's Face Face Face Ratings Amount Amount Amount (Unaudited) (000) Value (000) Value (000) Value ----------- ------ ----- ------ ----- ------ ----- Western Wireless Corp. Sr. Sub. Notes 10.50%, 2/1/07 B1 600 621,751 Williams Communications Group, Inc.: Sr. Notes 10.70%, 10/1/07 B2 400 310,000 10.875%, 10/1/09 B2 750 562,500 Winstar Communications, Inc. Sr. Notes 12.75%, 4/15/10 B3 1,000 665,000 Worldcom, Inc. Sr. Notes 7.55%, 4/1/04 A3 110 110,386 Worldwide Fiber, Inc. Sr. Notes 12.00%, 8/1/09 (1) B3 950 712,500 Group Total 47,031,708 Textiles/Apparel (1.4%) Galey & Lord Gtd. 9.125%, 3/1/08 Ca 1,000 545,000 Phillips-Van Heusen Corp. Sr. Sub. Notes 9.50%, 5/1/08 B1 800 748,000 Pillowtex Corp. Gtd. Sr. Sub. Notes 10.00%, 11/15/06 (2) B2 $500 $22,500 Simmons Co. Series B, Sr. Sub. Notes 10.25%, 3/15/09 B3 900 837,000 Tropical Sportswear International Series A, Gtd. Sr. Notes 11.00%, 6/15/08 B3 1,000 855,000 Westpoint Stevens, Inc. Sr. Notes 7.875%, 6/15/05 B1 1,000 750,000 William Carter Co. Series A, Sr. Sub. Notes 10.375%, 12/1/06 B3 500 487,500 Group Total 4,245,000 Transportation (1.3%) AirTran Airlines, Inc. Yankee Sr. Notes 10.50%, 4/15/01 B2 1,500 1,485,000 Allied Holdings Series B, Gtd. 8.625%, 10/1/07 B1 250 183,750 Cenargo International plc First Priority Ship Mortgage Notes 9.75%, 6/15/08 Ba3 100 78,250 First Wave Marine, Inc. Gtd. Sr. Notes 11.00%, 2/1/08 B3 1,100 244,750 Golden Ocean Group, Ltd. Gtd. Sr. Notes 10.00%, 8/31/01 (2)(6) N/R 1,411 229,288 Norfolk Southern Corp. Notes 7.875%, 2/15/04 Baa1 260 270,050 Pegasus Shipping (Hellas), Ltd. Series A, First Preferred Ship Mortgage Notes 11.875%, 11/15/04 (2) B3 300 106,500 Sea Containers, Ltd. Yankee Sr. Notes 10.75%, 10/15/06 Ba3 700 509,250 Trans World Airlines, Inc. Sr. Notes 11.375%, 3/1/06 Caa1 1,750 341,250 Ultrapetrol (Bahamas) Ltd. First Mortgage Notes 10.50%, 4/1/08 B1 150 113,250 Group Total 3,561,338 TOTAL CORPORATE OBLIGATIONS (Cost $311,248,828) 2 25,690,762 GOVERNMENT & AGENCY SECURITIES (0.7%) Federal National Mortgage Association (0.2%) STRIPS, Series H, Class 2 11.50%, 5/1/09 Aaa 416 458,185 Government National Mortgage Association (0.0%) Various Pools:10.50%, 9/15/15 Aaa $33 $35,444 10.50%, 12/15/15 Aaa 3 3,304 10.50%, 3/15/16 Aaa 25 26,958 10.50%, 8/15/16 Aaa 33 35,863
- 13 - PRO FORMA PORTFOLIO OF INVESTMENTS OF COMBINED FUND December 31, 2000
CGF CGF --------------- ----------------- Moody's Face Face Face Ratings Amount Amount Amount (Unaudited) (000) Value (000) Value (000) Value ----------- ------ ----- ------ ----- ------ ----- Group Total 101,569 United States Treasury Notes (0.5%) 5.75%, 10/31/02 Aaa 10 10,093 5.75%, 8/15/10 Aaa 220 230,639 7.25%, 5/15/04 Aaa 990 1,054,075 Group Total 1,294,807 TOTAL GOVERNMENT & AGENCY SECURITIES (Cost $1,784,977) 1,854,561 COLLATERALIZED MORTGAGE OBLIGATIONS (0.7%) Aames Mortgage Trust Series 00-1, Class A 4F 7.76%, 1/25/29 Aaa 135 139,198 Commercial Mortgage Asset Trust Series 1999, Class A3 6.64%, 9/17/10 Aaa 310 318,004 Conseco Finance 2000-D A4 8.17%, 12/15/25 Aaa 85 89,677 First Union Series 1997, Class 1 7.38%, 4/18/29 Aaa 85 89,631 GMAC Commercial Mortgage Securities, Inc.: 6.853%, 9/15/06 Aaa 80 81,778 6.945%, 9/15/33 Aaa 550 567,286 Korea Asset Funding Ltd. Series 2000-1A, Class 1 8.8912%, 2/10/09 (7) Baa2 50 49,187 Nomura Asset Securities Corp. Series 1998-D6, Class A1B6 6.59%, 3/17/28 Aaa 310 313,410 Salomon Brothers Mortgage Securities VII Series 2000-C3, Class A2 6.592%, 10/18/10 Aaa 280 282,059 TOTAL COLLATERALIZED MORTGAGE OBLIGATIONS (Cost $1,903,022) 1,930,230 ASSET BACKED OBLIGATIONS (1.0%) Chase Credit Card Master Trust Series 1999-3, Class A 6.66%, 1/15/07 Aaa 420 430,273 Constellation Finance, LLC Series 1997-1, Class 1 9.80%, 12/15/02 (1) N/R 250 232,500 Contimortgage Home Equity Loan Trust 7.22%, 1/15/28 Aaa 125 126,889 Green Tree Recreational, Equipment & Consumer Trust, Consumer Products & Equipment Retail Installment Sale Contracts Series 1997-C, Class A-1, 6.49%, 2/15/18 N/R 288 290,217 MBNA Master Credit Card Trust: Series 1999-G, Class A 6.35%, 12/15/06 Aaa 130 132,205 Series 1997-I, Class A 6.55%, 1/15/07 Aaa 160 163,766 Peco Energy Transition Trust: Series 1999-A, Class A7 6.13%, 3/1/09 Aaa 335 336,989 Series 2000-A, ClassA4 7.65%, 3/1/10 Aaa 290 309,646 Prudential Securities Secured Financing Corp. Series 1999-C2, Class A2 7.193%, 4/15/09 Aaa 385 402,836 Residential Asset Securities Corp. Series 1999-KS3, Class AI2 7.075%, 9/25/20 Aaa 125 125,742 UCFC Home Equity Loan: Series 1996-B1, Class A7 8.20%, 9/15/27 Aaa 110 112,183 Series 1998-A, Class A7 6.87%, 7/15/29 Aaa 50 48,635 TOTAL ASSET BACKED OBLIGATIONS (Cost $2,668,771) 2,711,881 Value
- 14 - PRO FORMA PORTFOLIO OF INVESTMENTS OF COMBINED FUND December 31, 2000
CGF CGF --------------- ----------------- Moody's Face Face Face Ratings Amount Amount Amount (Unaudited) (000) Value (000) Value (000) Value ----------- ------ ----- ------ ----- ------ ----- COMMON STOCKS (1.0%) Automotive (0.0%) Safety Components International, Inc. (4) 500,000 $62,500 Broadcasting (0.1%) Spanish Broadcasting System, Inc. Class B (1)(4) 35,700 $176,269 UnitedGlobalCom, Inc. Class A (4) 5,442 74,147 Group Total 250,416 Cable (0.0%) OpTel, Inc. (1)(4) 1,500 15 Consumer Products & Services (0.0%) Crown Packaging Enterprises, Ltd. (4) 354,594 3,546 Entertainment (0.1%) Premier Cruises, Ltd. (4)(6) 85,168 223,566 Financial Services (0.0%) Westfed Holdings, Inc. Class B (acquired 9/20/88, cost $510) (4)(5)(6) 16,893 0 Food & Beverages (0.0%) Aurora Foods, Inc. 15,940 38,854 Specialty Foods Corp. (4)(6) 52,500 525 Group Total 39,379 Metals & Mining (0.0%) Sheffield Steel Corp. (4) 8,750 88 Paper & Forest Products (0.1%) Mail-Well, Inc. (1)(4)(6) 31,958 137,818 Restaurants, Hotels & Gaming (0.0%) Motels of America, Inc. (1)(4) 750 5,250 Retail (0.4%) Pathmark Stores, Inc. (4) 72,018 1,188,298 Telecommunications (0.3%) CompleTel Europe N.V. (4) 45,000 160,312 e. spire Communications, Inc. (4) 42,505 21,253 Intermedia Communications, Inc. (4) 12,640 90,850
- 15 - PRO FORMA PORTFOLIO OF INVESTMENTS OF COMBINED FUND December 31, 2000
CGF CGF --------------- ----------------- Moody's Face Face Face Ratings Amount Amount Amount (Unaudited) (000) Value (000) Value (000) Value ----------- ------ ----- ------ ----- ------ ----- Loral Space & Communications, Co. (4) 453 1,443 Price Communications Corp. (4) 7,346 123,505 Spanish Broadcasting System, Inc. Class B (1)(4) 107,100 528,806 UnitedGlobalCom, Inc. Class A (4) 2,058 28,040 Viatel, Inc. (4) 182 677 Group Total 954,886 TOTAL COMMON STOCKS (Cost $2,064,371) 2,865,762 PREFERRED STOCKS (2.3%) Broadcasting (0.3%) Benedek Communications Corp. 11.50% Sr. Exchangeable 150 $73,688 Granite Broadcasting Corp. 12.75%, Cum. Exchangeable (4)(8) 11 550 Pegasus Communications Corp.: 12.75% Cum. Exchangeable, Series A (4) 110 102,987 Units 250 253,062 Source Media, Inc. 13.50% Units (4) 87,680 482,241 Group Total 912,528 Cable (0.4%) Adelphia Communications Corp. 13% Cum. Exchangeable, Series B 7,500 669,375 DIVA Systems Corp. Series D (4) 56,913 455,304 NTL, Inc. 13% Exchangeable, Series B 2 1,178 Group Total 1,125,857 Financial Services (0.1%) Deutsche Bank Capital Funding Tr I 7.872% Non-cumulated (1) 120,000 118,594 Lehman Brothers Holdings: 5.67% 1,100 44,138 5.94%, Series C 500 21,000 Westfed Holdings, Inc. Class A (acquired 9/20/88-6/18/93, cost $4,815,472) (5)(6) 57,005 57,005 Group Total 240,737 Metals & Mining (0.0%) International Utility Structures, Inc.: 13% Units (1)(4) 150 82,875 14% Units 39 2,457 Group Total 85,332 Publishing & Information Services (0.3%) Earthwatch, Inc. 8.50% Convertible Preferred 57,657 14,415 Interact Electronic Marketing 14% Conv. Preferred (4) 1,350 81,000 Primedia, Inc. 10% Cum. Exchangeable, Series D 8,500 699,125 Group Total 794,540
- 16 - PRO FORMA PORTFOLIO OF INVESTMENTS OF COMBINED FUND December 31, 2000
CGF CGF --------------- ----------------- Moody's Face Face Face Ratings Amount Amount Amount (Unaudited) (000) Value (000) Value (000) Value ----------- ------ ----- ------ ----- ------ ----- Restaurants, Hotels & Gaming (0.0%) AmeriKing, Inc. 13% Cum. Exchangeable 32,280 40,350 Telecommunications (1.2%) e. spire Communications, Inc.12.75% 359 $26,027 Intermedia Communications, Inc.: 13.50% Exchangeable, Series B 396 99,000 7.00% Jr. Convertible, Series E 59,000 582,625 Nextel Communications, Inc. 13% Exchangeable, Series D 1,574 1,522,844 Rural Cellular Corp. 11.375% Sr. Exchangeable 326 261,615 XO Communications, Inc. 14% PIK (Pay-In-Kind) 25,962 785,350 Group Total 3,277,461 TOTAL PREFERRED STOCKS (Cost $15,157,969) 6,476,805 RIGHTS (0.0%) Abraxas Petroleum Corp. expiring 11/1/04 92,408 11,551 Terex Corp. expiring 5/15/02 8,000 112,000 TOTAL RIGHTS (Cost $0) 123,551 WARRANTS (0.6%) Aavid Thermal Technologies, Inc. expiring 2/1/07 (4) 150 1,500 Ampex Corp. expiring 3/15/03 (1)(4) 34,000 340 Arcadia Financial Ltd. expiring 3/15/07 (4) 475 0 Australis Holdings Pty. Ltd. expiring 10/30/01 (1)(4) 2,500 25 Australis Media Ltd. expiring 5/15/03 (4) 225 2 CHC Helicopter Corp. expiring 12/15/00 (4) 8,000 28,000 Carrier1 International SA expiring 2/19/09 (1)(4) 300 3,000 Crown Packaging Holdings, Ltd. expiring 11/1/03 (4) 3,000 30 DIVA Systems Corp.: expiring 5/15/06 (1)(4) 2,825 1,299,500 expiring 3/1/08 11,655 93,240 DTI Holdings, Inc. expiring 3/1/08 (1)(4) 10,750 1,290 Dairy Mart Convenience Stores, Inc. expiring 12/1/01 (4) 15,837 5,543 Dayton Superior Corp. expiring 6/15/09 (4) 1,250 25,000 Decrane Aircraft Holdings expiring 9/30/08 (4) 800 800 Equinix, Inc. expiring 12/01/07 (4) 200 18,000 GT Group Telecom, Inc. expiring 2/1/10 (4) 400 20,000 Golden Ocean Group, Ltd. expiring 8/31/01 (4)(6) 1,374 $5,514 HF Holdings Inc. expiring 9/27/09 (4) 11,330 114 Interact Electronic Marketing expiring 12/31/09 (4) 1,350 13 Interact Systems, Inc. expiring 8/1/03 (1)(4) 1,150 0 Isle of Capri Casinos, Inc. expiring 5/3/01 (4) 3,528 476 Key Energy Services expiring 1/15/09 (1)(4) 1,500 75,000 McCaw International, Ltd. expiring 4/15/07 (4) 1,750 43,750
- 17 - PRO FORMA PORTFOLIO OF INVESTMENTS OF COMBINED FUND December 31, 2000
CGF CGF --------------- ----------------- Moody's Face Face Face Ratings Amount Amount Amount (Unaudited) (000) Value (000) Value (000) Value ----------- ------ ----- ------ ----- ------ ----- Mentus Media Corp. expiring 2/1/08 (1)(4) 4,731 48 Mrs. Fields Holding expiring 12/1/05 (1)(4) 2,250 22,500 PLD Telekom, Inc. expiring 6/1/06 (4) 2,170 21,700 Pliant Corp. expiring 6/1/10 (4) 1,000 10,125 Source Media, Inc. expiring 11/1/07 (4) 32,966 32,966 Star Choice Communications, Inc. expiring 12/5/05 (1)(4) 16,212 129,696 Startec Global Communications Corp. expiring 5/15/08 (4) 1,100 715 USN Communications, Inc. expiring 8/15/04 (4) 10,650 0 Waste Systems International, Inc. expiring 3/2/04 (4) 5,250 53 Wright Medical Technology expiring 6/30/03 (4) 824 0 TOTAL WARRANTS (Cost $1,961,705) 1,838,940 TOTAL DOMESTIC SECURITIES (Cost $336,789,641) 243,492,492 FOREIGN SECURITIES (9.4%) CORPORATE OBLIGATIONS (1.6%) Argentina (0.4%) CIA Internacional Telecommunicacoes Sr. Notes 10.375%, 8/1/04 (1) N/R 635 512,763 Hidroelectrica Piedra del Aguila S.A.: Collateral Trust 8.25%, 6/30/09 (1) N/R 890 571,998 8.00%, 12/31/09 N/R $277 $191,569 Group Total 1,276,330 Netherlands (0.8%) CompleTel Europe N.V. Yankee Gtd. 0.00%, 2/15/09 Caa2 $900 450,000 Hermes Europe Railtel B.V. Sr. Notes 11.50%, 8/15/07 B3 1,300 539,500 KPNQwest N.V. Sr. Notes 8.125%, 6/1/04 Ba1 150 132,750 Netia Holdings B.V. Gtd. 13.75%, 6/15/10 B2 455 377,203 United Pan-Europe Communications N.V. Sr. Notes 10.875%, 8/1/09 B2 $1,150 $741,750 Group Total 2,241,203 Poland (0.3%) PTC International Finance B.V. Yankee Gtd. 10.75%, 7/1/07 (1) B2 350 256,375 PTC International Finance II SA Gtd. 11.25%, 12/1/09 B2 750 716,250 Group Total 972,625 South Korea (0.1%) Cho Hung Bank Sub. Notes 11.50%, 4/1/10 Ba3 150 145,643 TOTAL CORPORATE OBLIGATIONS (Cost $4,987,444) 4,635,801
- 18 - PRO FORMA PORTFOLIO OF INVESTMENTS OF COMBINED FUND December 31, 2000
CGF CGF --------------- ----------------- Moody's Face Face Face Ratings Amount Amount Amount (Unaudited) (000) Value (000) Value (000) Value ----------- ------ ----- ------ ----- ------ ----- GOVERNMENT OBLIGATIONS (7.8%) Argentina (2.5%) Bocon PRO1 Notes 2.953%, 4/1/07 (7) Ba3 2,842 1,726,784 Republic of Argentina: Notes 11.00%, 12/4/05 (3) B1 750 708,750 Series BGL5 11.375%, 1/30/17 Ba3 560 502,040 Unsubordinated 11.75% 4/07/09 B1 790 738,058 9.75%, 9/19/27 Ba3 1,580 1,275,850 Debentures 6.188%, 3/31/05 B1 878 799,124 Foreign Government Gtd. 6.00%, 3/31/23 B1 1,600 1,110,000 Series B, Gtd. 0.00%, 4/15/01 Ba3 125 119,844 Gtd. 0.00%, 10/15/04 Ba3 95 62,225 Group Total 7,042,675 Brazil (2.0%) Federal Republic of Brazil: Series RG 7.6875%, 4/15/09 B2 570 495,900 Series EI-L Debentures 10.125%, 5/15/27 B2 910 729,365 Capitalization Bonds 8.00%, 4/15/14 B2 2,814 2,179,794 Bearer Bonds 11.00%, 8/17/40 B2 2,826 2,307,429 Group Total 5,712,488 Bulgaria (0.5%) Republic of Bulgaria: Notes 3.00%, 7/28/12 B2 1,510 1,124,950 Front Loaded Interest Reduction Bonds, Series A 5.875%, 7/28/24 B2 475 363,375 Debentures Series PDI, 6.50% 7/28/11 B2 105 79,275 Group Total 1,567,600 Mexico (0.1%) United Mexican States Bonds 10.375%, 2/17/09 Baa3 210 230,160 Morocco (0.1%) Republic of Morocco 7.5625%, 1/1/09 N/R 242 209,803 Peru (0.1%) Republic of Peru Collateralized 7.1875%, 3/8/27 N/R 410 260,350 Philippines (0.4%) Republic of Philippines: Gtd. 7.50%, 6/1/08 Ba1 304 267,667 Notes 10.625%, 3/16/25 Ba1 $930 $764,925 Group Total 1,032,592 Poland (0.0%) Republic of Poland Bonds 3.75%, 10/27/24 Baa1 140 96,600
- 19 - PRO FORMA PORTFOLIO OF INVESTMENTS OF COMBINED FUND December 31, 2000
CGF CGF --------------- ----------------- Moody's Face Face Face Ratings Amount Amount Amount (Unaudited) (000) Value (000) Value (000) Value ----------- ------ ----- ------ ----- ------ ----- Russia (2.1%) Ministry Finance Russia Debentures 3.00%, 5/14/06 N/R 1,750 800,449 Russia Federation: Registered Series 8.75%, 7/24/05 B3 150 114,375 10.00%, 6/26/07 B3 420 308,175 11.00%, 7/24/18 B3 570 401,850 Unsubordinated 8.25%, 3/31/10 B3 1,047 655,491 11.00%, 7/24/18 B3 30 21,075 12.75%, 6/24/28 B3 50 41,750 2.25%, 3/31/30 B3 8,714 3,278,548 Registered Bonds 12.75%, 6/24/28 B3 375 311,719 Group Total 5,933,432 TOTAL GOVERNMENT OBLIGATIONS (Cost $21,199,123) 22,085,700 TOTAL FOREIGN SECURITIES (Cost $26,186,567) 26,721,501 TIME DEPOSITS (1.6%) (Cost $4,417,000) 4,417,000 TOTAL INVESTMENTS (97.0%) (Cost $367,393,210) 274,630,993 OTHER ASSETS IN EXCESS OF LIABILITIES (3.0%) 8,517,574 NET ASSETS (100%) $283,148,567
- -------------------- N/R - Not Rated STRIPS - Separate Trading of Registered Interest and Principal Securities. (1) 144A Security. Certain conditions for public sale may exist. (2) Defaulted security. (3) Step Bond - Coupon rate is low or zero for an initial period and then increases to a higher coupon rate thereafter. Maturity date disclosed is the ultimate maturity. (4) Non-income producing security. (5) Restricted as to private and public resale. Total cost of restricted securities at December 31, 2000 aggregated $3,611,992. Total market value of restricted securities owned at December 31, 2000 was $42,579 or 0.02% of net assets. (6) Securities for which market quotations are not readily available are valued at fair value as determined in good faith by the Board of Directors. (7) Floating Rate - The interest rate changes on these instruments based upon a designated base rate. The rates shown are those in effect at December 31, 2000. NOTES TO PRO FORMA FINANCIAL STATEMENTS (UNAUDITED) 1. Basis of Combination The unaudited Pro Forma Combining Financial Statements reflect the accounts of the Credit Suisse Asset Management Strategic Global Income Fund, Inc. ("CGF") and Credit Suisse Asset Management Income Fund, Inc. ("CIK"), collectively the Funds, as of and for the twelve months ended December 31, 2000. These statements have been derived from the books and records utilized in calculating the respective weekly net asset values of the Funds as of December 31, 2000. The pro forma financial statements give effect to the proposed transfers of the assets and stated liabilities of CGF in exchange for shares of CIK. Under the purchase method of accounting for business combinations, the basis of portfolio securities in CGF at the time of the reorganization will be the fair value of such assets at the close of business of the day immediately preceding the reorganization. The Pro Forma Financial Statements reflect the combined results of operations of CGF and CIK. All ordinary and reasonable expenses incurred in connection with the reorganization will be borne by CGF and CIK. See the Notes to the Pro Forma Statement of Operations for details of the pro forma expense adjustments. The Pro Forma Combining Statement of Assets and Liabilities, Statement of Operations, and Schedule of Portfolio Investments should be read in conjunction with the historical financial statements of CGF and CIK which have been incorporated by reference in the Statement of Additional Information constituting part of the Form N-14 Registration Statement. 2. Advisory, Administration, Transfer Agent and Custodian Fees Credit Suisse Asset Management, LLC (the "Adviser") provides investment advisory services to the Funds under the terms of an Advisory Agreement. Under the Advisory Agreement, the Adviser is paid a fee, computed weekly and payable quarterly at an annual rate of 0.50% of average weekly net assets. Brown Brothers Harriman & Co. provides administrative and custodial services to the Funds and they are compensated at a fee rate based on average net assets. Fleet National Bank provides transfer agent services to the Funds and they are compensated at a fee rate based on the number of accounts per year, plus out-of-pocket expenses. 3. Portfolio Valuation Market values for fixed income securities are valued at the latest quoted bid price in the over-the-counter market. However, fixed-income securities may be valued on the basis of prices provided by a pricing service which are based primarily on institutional size trading in similar groups of securities. Other securities listed on an exchange are valued at the latest quoted sales prices on the day of valuation or if there was no sale on such day, the last bid price quoted on such day. Securities purchased with remaining maturities of 60 days or less are valued at amortized cost, if it approximates market value. Securities for which market quotations are not readily available (including restricted securities) are valued at fair value as determined in good faith by the Board of Directors. 4. Capital Shares Both CGF and CIK have 100,000,000 of shares authorized, each with a par value of $0.001 per share. The pro forma net asset value per share assumes the issuance of shares of CIK to shareholders of CGF in connection with the proposed reorganization. Fractional shares will not be issued in connection with this reorganization. Cash will be remitted to CGF shareholders in exchange for their fractional shares. -5- PART C OTHER INFORMATION Item 15. Indemnification Section 2-418 of the Corporation Law of the State of Maryland gives Registrant the power to indemnify its directors and officers. Section 2-418 provides in pertinent part: "(b)(1) A corporation may indemnify any director made a party to any proceeding by reason of service in that capacity unless it is established that: (i) The act or omission of the director was material to the cause matter giving rise to the proceeding; and 1. Was committed in bad faith; or 2. Was the result of active and deliberate dishonesty; or (ii) The director actually received an improper personal benefit in money, property or services; or (iii) In the case of any criminal proceeding, the director had reasonable cause to believe that the act or omission was unlawful. (2)(i) Indemnification may be against judgments, penalties, fines, settlements, and reasonable expenses actually incurred by the director in connection with the proceeding. (ii) However, if the proceeding was one by or in the right of the corporation, indemnification may not be made in respect of any proceeding in which the director shall have been adjudged to be liable to the corporation. (3)(i) The termination of any proceeding by judgment, order, or settlement does not create a presumption that the director did not meet the requisite standard of conduct set forth in this subsection. (ii) The termination of any proceeding by conviction, or a plea of nolo contendere or its equivalent, or an entry of an order of probation prior to judgment, creates a rebuttable presumption that the director did not meet that standard of conduct. (4) A corporation may not indemnify a director or advance expenses under this section for a proceeding brought by that director against the corporation, except: (i) For a proceeding brought to enforce indemnification under this section; or (ii) If the charter or bylaws of the corporation, a resolution of the board of directors of the corporation, or an agreement approved by the board of directors of the corporation to which the corporation is a party expressly provide otherwise. "(c) A director may not be indemnified under subsection (b) of this section in respect of any proceeding charging improper personal benefit to the director, whether or not involving action in the director's official capacity, in which the director was adjudged to be liable on the basis that personal benefit was improperly received. "(d) Unless limited by the charter: (1) A director who has been successful, on the merits or otherwise, in the defense of any proceeding referred to in subsection (b) of this section shall be indemnified against reasonable expenses incurred by the director in connection with the proceeding. (2) A court of appropriate jurisdiction upon application of a director and such notice as the court shall require, may order indemnification in the following circumstances: (i) If it determines a director is entitled to reimbursement under paragraph (1) of this subsection, the court shall order indemnification, in which case the director shall be entitled to recover the expenses in securing such reimbursement; or (ii) If it determines that the director is fairly and reasonably entitled to indemnification in view of all the relevant circumstances, whether or not the director has met the standards of conduct set forth in Subsection (b) of this section or has been adjudged liable under the circumstances described in subsection (c) of this section, the court may order such indemnification as the court shall deem proper. However, indemnification with respect to any proceeding by or in the right of the corporation or in which liability shall have been adjudged in the circumstances described in subsection (c) shall be limited to expenses. (3) A court of appropriate jurisdiction may be the same court in which the proceeding involving the director's liability took place. (e)(1) Indemnification under subsection (b) of this section may not be made by the corporation unless authorized for a specific proceeding after a determination has been made that indemnification of the director is permissible in the circumstances because the director has met the standard of conduct set forth in subsection (b) of this section. -2- (2) Such determination shall be made: (i) By the board of directors by a majority vote of a quorum consisting of directors not, at the time, parties to the proceeding, or, if such a quorum cannot be obtained, then by a majority vote of a committee of the board consisting solely of two or more directors not, at the time, parties to such proceeding and who were duly designated to act in the matter by a majority vote of the full board in which the designated directors who are parties may participate; (ii) By special legal counsel selected by the board of directors or a committee of the board by vote as set forth in subparagraph (i) of this paragraph, or, if the requisite quorum of the full board cannot be obtained therefor and the committee cannot be established, by a majority vote of the full board in which directors who are parties may participate; or (iii) By the stockholders. (3) Authorization of indemnification and determination as to reasonableness of expenses shall be made in the same manner as the determination that indemnification is permissible. However, if the determination that indemnification is permissible is made by special legal counsel, authorization of indemnification and determination as to reasonableness of expenses shall be made in the manner specified in subparagraph (ii) of paragraph (2) of this subsection for selection of such counsel. (4) Shares held by directors who are parties to the proceeding may not be voted on the subject matter under this subsection. (f)(1) Reasonable expenses incurred by a director who is a party to a proceeding may be paid or reimbursed by the corporation in advance of the final disposition of the proceeding upon receipt by the corporation of: (i) A written affirmation by the director of the director's good faith belief that the standard of conduct necessary for indemnification by the corporation as authorized in this section has been met; and (ii) A written undertaking by or on behalf of the director to repay the amount if it shall ultimately be determined that the standard of conduct has not been met. (2) The undertaking by or on behalf of the director to repay the amount if it shall ultimately be determined that the standard of conduct has not been met. (2) The undertaking required by subparagraph (ii) of paragraph (1) of this subsection shall be an unlimited general obligation of the director but need not be secured and may be accepted without reference to financial ability to make the repayment. -3- (3) Payments under this subsection shall be made as provided by the charter, bylaws, or contract or as specified in subsection (e) of this section. (g) The indemnification and advancement of expenses provided or authorized by this section may not be deemed exclusive of any other rights, by indemnification or otherwise, to which a director may be entitled under the charter, the bylaws, a resolution of stockholders or directors, an agreement or otherwise, both as to action in an official capacity and as to action in another capacity while holding such office. (h) This section does not limit the corporation's power to pay or reimburse expenses incurred by a director in connection with an appearance as a witness in a proceeding at a time when the director has not been made a named defendant or respondent in the proceeding. (i) For purposes of this section: (1) The corporation shall be deemed to have requested a director to serve an employee benefit plan where the performance of the director's duties to the corporation also imposes duties on, or otherwise involves services by, the director to the plan or participants or beneficiaries of the plan; (2) Excise taxes assessed on a director with respect to an employee benefit plan pursuant to applicable law shall be deemed fines; and (3) Action taken or omitted by the director with respect to an employee benefit plan in the performance of the director's duties for a purpose reasonably believed by the director to be in the interest of the participants and beneficiaries of the plan shall be deemed to be for a purpose which is not opposed to the best interests of the corporation. (j) Unless limited by the charter: (1) An officer of the corporation shall be indemnified as and to the extent provided in subsection (d) of this section for a director and shall be entitled, to the same extent as a director, to seek indemnification pursuant to the provisions of subsection (d); (2) A corporation may indemnify and advance expenses to an officer, employee, or agent of the corporation to the same extent that it may indemnify directors under this section; and (3) A corporation, in addition, may indemnify and advance expenses to an officer, employee, or agent who is not a director to such further extent, consistent with law, as may be provided by its charter, bylaws, general or specific action of its board of directors, or contract. -4- (k)(1) A corporation may purchase and maintain insurance on behalf of any person who is or was a director, officer, employee, or agent of the corporation, or who, while a director, officer, employee, or agent of the corporation, is or was serving at the request of the corporation as a director, officer, partner, trustee, employee, or agent of another foreign or domestic corporation, partnership, joint venture, trust, other enterprise, or employee benefit plan against any liability asserted against and incurred by such person in any such capacity or arising out of such person's position, whether or not the corporation would have the power to indemnify against liability under the provisions of this section. (2) A corporation may provide similar protection, including a trust fund, letter of credit, or surety bond, not inconsistent with this section. (3) The insurance or similar protection may be provided by a subsidiary or an affiliate of the corporation. (l) Any indemnification of, or advance of expenses to, a director in accordance with this section, if arising out of a proceeding by or in the right of the corporation, shall be reported in writing to the stockholders with the notice of the next stockholders' meeting or prior to the meeting. (2) A corporation may provide similar protection, including a trust Fund, letter of credit, or surety bond, not inconsistent with this section. (3) The insurance or similar protection may be provided by a subsidiary or an affiliate of the corporation." Article Eight of the Registrant's Articles of Incorporation states as follows: "Section 3. The Corporation shall indemnify to the fullest extent permitted by law (including the Investment Company Act of 1940) as currently in effect or as may hereafter be amended, any person made or threatened to be made a party to any action, suit or proceeding, whether criminal, civil, administrative or investigative, by reason of the fact that such person or such person's testator or intestate is or was a Director or Officer. To the fullest extent permitted by law (including the Investment Company Act of 1940) as currently in effect or as the same may hereafter be amended, expenses incurred by any such person in defending any such action, suit or proceeding shall be paid or reimbursed by the Corporation promptly upon receipt by it of an undertaking of such person to repay such expenses if it shall ultimately be determined that such person is not entitled to be indemnified by the Fund. Before the Fund may advance such expenses, one of the following provisions must be satisfied: 1) such Director or Officer shall provide a security for his undertaking, 2) the Corporation shall be insured against losses arising by reason of any lawful advances, or 3) a majority of a quorum of disinterested, non-party directors of the Corporation, or an independent legal counsel in a written opinion, shall determine, based on a review of readily available facts, that there is reason to believe that such Director or Officer ultimately will be found entitled to indemnification. The rights provided to any person by this Section of this Article shall be enforceable against the Corporation by such person who shall be presumed to have relied upon it in serving or continuing to serve as a -5- Director or Officer as provided above. No amendment of this Section of this Article shall impair the rights of any person arising at any time with respect to events occurring prior to such amendment. For purposes of this Section of this Article, the term "Corporation" shall include any predecessor of the Corporation and any constituent corporation (including any constituent of a constituent) absorbed by the Corporation in a consolidation or merger; the term "other enterprise" shall include any corporation, partnership, joint venture, trust or employee benefit plan; service "at the request of the Corporation" shall include service as a Director or Officer of the Corporation which imposes duties on, or involves services by, such Director or Officer with respect to an employee benefit plan, its participants or beneficiaries; any excise taxes assessed on a person with respect to an employee benefit plan, its participants or beneficiaries; any excise taxes assessed on a person with respect to an employee benefit plan shall be deemed to be indemnifiable expenses; and action by a person with respect to any employee benefit plan which such person reasonably believes to be in the interest of the participants and beneficiaries of such plan shall be deemed to be action not opposed to the best interests of the Corporation. "Section 4. Nothing in this Article protects or purports to protect, any director or officer against any liability to the Corporation or its security holders to which he or she would otherwise be subject by reason of willful misfeasance, bad faith, gross negligence or reckless disregard of the duties involved in the conduct of his or her office. "Section 5. A Director or Officer of the Corporation shall not be liable to the Corporation or its stockholders for monetary damages for breach of fiduciary duty as a Director or Officer, except to the extent such exemption from liability or limitation thereof is not permitted by law (including the Investment Company Act of 1940 and rules or regulations thereunder or any releases issued by the Securities and Exchange Commission or its staff) as currently in effect or as the same may hereafter be amended. Article VII of Registrant's By-Laws states as follows: "Article VII. The Corporation shall indemnify its Directors and officers against judgments, fines, settlements and expenses to the fullest extent authorized and in the manner permitted, by applicable federal and state law and the Articles of Incorporation of the Corporation." A policy of insurance covering Credit Suisse Asset Management, LLC, its affiliates, and all of the registered investment companies advised by Credit Suisse Asset Management, LLC insures the Registrant's directors and officers and others against liability arising by reason of an alleged breach of duty caused by any negligent act, error or accidental omission in the scope of its duties and the Registrant against any payments which it is obligated to make to such persons under the indemnification provisions described above. Each of the Non-interested Directors of the Funds is party to an Indemnification Agreement with the Fund or Funds as to which he serves as a director providing for contractual rights of indemnity and advancement of expenses. Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the Fund pursuant to the -6- provisions described above, or otherwise, the Fund has been advised that, in the opinion of the Securities and Exchange Commission, such indemnification is against public policy as expressed in the Securities Act of 1933 and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the Fund of expenses incurred or paid by a director, officer or controlling person of the Fund in the successful defense of any action, suit or proceeding) is asserted against the Fund by such director, officer or controlling person in connection with the securities being registered, the Fund will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Securities Act of 1933 and will be governed by the final adjudication of such issue. -7- Item 16. Exhibits 1. Articles of Incorporation of the Registrant, as amended 2. Amended and Restated By-laws of the Registrant* 3. Not Applicable 4. Form of Agreement and Plan of Reorganization** 5. Not Applicable 6. Restated Investment Advisory Agreement between the Registrant and Credit Suisse Asset Management, LLC dated February ____, 2001+ 7. Not Applicable 8. Not Applicable 9. Custodian Agreement between the Registrant and Brown Brothers Harriman & Co. dated January 29, 1999*** 10. Not Applicable 11. (a) Opinion of Willkie Farr & Gallagher*** (b) Opinion of Venable, Baetjer and Howard, LLP*** 12. Opinion of Willkie Farr & Gallagher with respect to tax matters*** 13. (a) Registrar, Transfer Agency and Service Agreement between the Registrant and Bank Boston, N.A. (now Fleet National Bank) dated October 26, 1998 - ------------------------------------------ * Incorporated by reference to Registrant's Form N-SAR filed on February 27, 2001. ** Included as Exhibit A to the Proxy Statement/Prospectus forming part of the Registration Statement. + If the reorganization of Credit Suisse Asset Management Strategic Global Income Fund, Inc. into the Registrant is consummated and the new Investment Advisory Agreement between CSAM and the Registrant is approved by the shareholders of the Registrant, this Agreement will be replaced with the Investment Advisory Agreement which is attached as Exhibit B to the Proxy Statement/Prospectus which forms Part A of this Registration Statement. *** To be filed by amendment. -8- (b) Administrative and Accounting Agency Agreement between the Registrant and Brown Brothers Harriman & Co. dated February 27, 1999 (c) Credit Agreement dated June 23, 1999, among the Registrant, other CSAM-advised investment companies, Deutsche Bank AG, as administrative agent, State Street Bank and Trust Company, as operations agent, Bank of Nova Scotia, as syndication agent, and the other lenders party thereto (the "Credit Agreement") (d) First Amendment to Credit Agreement dated June 21, 2000 14. Consent of PricewaterhouseCoopers LLP 15. Not Applicable 16. Not Applicable 17. Code of Ethics -9- Item 17. Undertakings (1) The Registrant agrees that prior to any public reoffering of the securities registered through the use of a prospectus which is a part of this registration statement by any person or party who is deemed to be an underwriter within the meaning of Rule 145(c) of the Securities Act, the reoffering prospectus will contain the information called for by the applicable registration form for reofferings by persons who may be deemed underwriters, in addition to the information called for by the other items of the applicable form. (2) The Registrant agrees that every prospectus that is filed under paragraph (1) above will be filed as a part of an amendment to the registration statement and will not be used until the amendment is effective, and that, in determining any liability under the 1933 Act, each post-effective amendment shall be deemed to be a new registration statement for the securities offered therein, and the offering of the securities at that time shall be deemed to be the initial bona fide offering of them. (3) The Registrant agrees to file the Opinion of Willkie Farr & Gallagher with respect to tax matters as an amendment to this registration statement pursuant to Rule 485(b) of the Securities Act as soon as practicable after the Closing Date (as such term is defined in this registration statement). -10- SIGNATURES Pursuant to the requirements of the Securities Act of 1933 and the Investment Company Act of 1940, the Registrant has duly caused this Registration Statement on Form N-14 to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of New York and the State of New York on the 2nd day of March 2001. Credit Suisse Asset Management Income Fund, Inc. By: /s/ Michael A. Pignataro ------------------------------------ Michael A. Pignataro, Chief Financial Officer and Secretary Each person whose signature appears below hereby constitutes and appoints Michael A. Pignataro and Hal Liebes, severally, his true and lawful attorney-in-fact and agent with full power of substitution and resubstitution, for him and in his name, place and stead, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this Registration Statement, and to file the same with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorney-in-fact and agent full power and authority to do and perform each and every act and thing requisite and necessary to be done, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that such attorney-in-fact and agent or his substitute or substitutes, may lawfully do or cause to be done by virtue hereof. Pursuant to the requirements of the Securities Act of 1933, this Registration Statement on Form N-14 has been signed below by the following persons in the capacities and on the dates indicated. SIGNATURE TITLE DATE /s/ James McCaughan Chairman of the Board and - ------------------- Director March 2, 2001 James McCaughan /s/ William W. Priest Director March 2, 2001 - --------------------- William W. Priest /s/ Dr. Enrique R. Arzac Director March 2, 2001 - ------------------------ Dr. Enrique R. Arzac /s/ Lawrence J. Fox Director March 2, 2001 - ------------------- Lawrence J. Fox /s/ James S. Pasman Director March 2, 2001 - ------------------- James S. Pasman /s/ Richard J. Lindquist President, Chief Investment March 2, 2001 - ------------------------ Officer Richard J. Lindquist /s/ Michael A. Pignataro Chief Financial Officer and March 2, 2001 - ------------------------ and Secretary Michael A. Pignataro -11- Exhibit No 1. Amended Articles of Incorporation of the Registrant 13.(a) Registrar, Transfer Agency and Service Agreement between the Registrant and BankBoston, N.A. (now Fleet National Bank) dated October 26, 1998 (b) Administrative and Accounting Agency Agreement between the Registrant and Brown Brothers Harriman & Co. dated February 27, 1999 (c) Credit Agreement dated June 23, 1999, among the Registrant, other CSAM-advised investment companies, Deutsche Bank AG, as administrative agent, State Street Bank and Trust Company, as operations agent, Bank of Nova Scotia, as syndication agent, and the other lenders party thereto (the "Credit Agreement") (d) First Amendment to Credit Agreement dated June 21, 2000 14. Consent of PricewaterhouseCoopers LLP 17. Code of Ethics -12- EX-99.1 2 0002.txt ARTICLES OF INCORPORATION ARTICLES OF INCORPORATION OF FIRST BOSTON QUALITY INCOME FUND, INC. ARTICLE I. I, the incorporator, Warren J. Olsen, whose post office address is 250 Park Avenue, New York, New York 10177, being at least eighteen years of age, am, under and by virtue of the General Laws of the State of Maryland authorizing the formation of corporations, forming a corporation. ARTICLE II. The name of the corporation (hereinafter called the "Corporation") is FIRST BOSTON QUALITY INCOME FUND. ARTICLE III. PURPOSES The purpose for which the Corporation is formed is to act as a closed-end, diversified investment company of the management type registered as such with the Securities and Exchange Commission pursuant to the Investment Company Act of 1940 and to exercise and generally to enjoy all of the powers, rights and privileges granted to, or conferred upon, corporations by the General Laws of the State of Maryland now or hereafter in force. ARTICLE IV. ADDRESS IN MARYLAND The post office address of the place at which the principal office of the Corporation in the State of Maryland is located is c/o The Corporation Trust Incorporated, 32 South Street, Baltimore, Maryland 21202. The name of the Corporation's resident agent is The Corporation Trust Incorporated, and its post office address is 32 South Street, Baltimore, Maryland 21202. Said resident agent is a corporation of the State of Maryland. ARTICLE V. COMMON STOCK Section 1. The total number of shares of stock which the Corporation has authority to issue is 100,000,000 shares of common stock of the par value of $0.001 each, all of one class, having an aggregate par value of $100,000. Section 2. The presence in person or by proxy of the holders of record of one-third of the shares of common stock issued and outstanding and entitled to vote thereat shall constitute a quorum for the transaction of any business at all meetings of the stockholders except as otherwise provided by law or in these Articles of Incorporation. Section 3. Notwithstanding any provision of the General Laws of the State of Maryland requiring action to be taken or authorized by the affirmative vote of the holders of a designated proportion greater than a majority of the shares of common stock, such action shall be valid and effective if taken or authorized by the affirmative vote of the holders of a majority of the total number of shares of common stock outstanding and entitled to vote thereupon pursuant to the provisions of these Articles of Incorporation. Section 4. No holder of shares of common stock of the Corporation shall, as such holder, have any preemptive right to purchase or subscribe for any shares of the common stock of the Corporation of any class which it may issue or sell. Section 5. All persons who shall acquire common stock in the Corporation shall acquire the same subject to the provisions of these Articles of Incorporation. 2 ARTICLE VI. DIRECTORS The initial number of directors of the Corporation shall be three, and the names of those who shall act as such until the first annual meeting and until their successors are duly elected and qualify are as follows: Michael F. Holland, Robert M. Baylis and James L. Freeman. However, the By-Laws of the Corporation may fix the number of directors at a number other than three and may authorize the Board of Directors, by the vote of a majority of the entire Board of Directors, to increase or decrease the number of directors within a limit specified in the By-Laws, provided that in no case shall the number of directors be less than three, and to fill the vacancies created by any such increase in the number of directors. Unless otherwise provided by the By-Laws of the Corporation, the directors of the Corporation need not be stockholders. The By-Laws of the Corporation may divide the Directors of the Corporation into classes and prescribe the tenure of office of the several classes; but no class shall be elected for a period shorter than that from the time of the election of such class until the next annual meeting and thereafter for a period shorter than the interval between annual meetings or for a longer period than five years, and the term of office of at least one class shall expire each year. ARTICLE VII. MANAGEMENT OF THE AFFAIRS OF THE CORPORATION Section 1. All corporate powers and authority of the Corporation (except as at the time otherwise provided by statute, by these Articles of Incorporation or by the By-Laws) shall be vested in and exercised by the Board of Directors. Section 2. The Board of Directors shall have the power to adopt, alter or repeal the By-Laws of the Corporation except to the extent that the By-laws otherwise provide. 3 Section 3. The Board of Directors shall have the power from time to time to determine whether and to what extent, and at what times and places and under what conditions and regulations, the accounts and books of the Corporation (other than the stock ledger) or any of them shall be open to the inspection of stockholders; and no stockholder shall have any right to inspect any account, book or document of the Corporation except to the extent permitted by statute or the By-Laws. Section 4. The Board Of Directors shall have the power to determine, as provided herein, or if provision is not made herein, in accordance with generally accepted accounting principles, what constitutes net income, total assets and the net asset value of the shares of Common Stock of the Corporation. Section 5. The Board of Directors shall have the power to distribute dividends from funds legally available therefor in such amounts, if any, and in such manner to the stockholders of record as of such date, as the Board of Directors may determine. ARTICLE VIII. Section 1. Provided that reasonable care has been exercised in the selection of the officers, other employees, investment advisers and managers, distributors, under- writers, selling agents, custodians, dividend disbursing agents, transfer agents and registrars, legal counsel, auditors, and other agents of the Corporation, no director of the Corporation shall be responsible or liable in any event for any neglect or wrong-doing of any of the same, nor shall any director be responsible or liable for the act or omission to act of any other director. Section 2. Each officer or director or member of any committee designated by the Board of Directors shall, in the performance of his duties, be fully protected in relying in good faith upon the books of account of or reports made to the Corporation by any of its officials 4 or by an independent public accountant or by an appraiser selected with reasonable care by the Board of Directors or by any such committee and in relying in good faith upon other records of the Corporation. Section 3. The Corporation shall indemnify its directors and officers to the fullest extent allowed, and in the manner provided, by Maryland law, including the advancing of expenses incurred in connection therewith. Such indemnification shall be in Addition to any other right or claim to which any director or officer may otherwise be entitled. The Corporation may purchase and maintain insurance on behalf of any person who is or was a director, officer, employee, or agent of the Corporation, or who, while a director, officer, employee or agent of the Corporation, is or was serving at the request of the Corporation as a director, officer, partner, trustee, employee, or agent of another foreign or domestic corporation, partnership, joint venture, trust, other enterprise, or employee benefit plan, against any liability asserted against and incurred by such person in any such capacity or arising out of such person's position, whether or not the Corporation would have had the power to indemnify such liability. Section 4. Nothing in this Article protects or purports to protect, any director or officer against any liability to the Corporation or its security holders to which he or she would otherwise be subject by reason of willful misfeasance, bad faith, gross negligence or reckless disregard of the duties involved in the conduct of his or her office. Section 5. Each section or portion thereof of this Article shall be deemed severable from the remainder, and the invalidity of any such section or portion shall not affect the validity of the remainder of this Article. ARTICLE IX. The duration of the Corporation shall be perpetual. 5 ARTICLE X. AMENDMENTS Section 1. From time to time any of the provisions of these Articles of Incorporation may be amended, altered or repealed (including any amendment that changes the terms of any of the outstanding stock by classification, reclassification or otherwise), and other provisions that may, under the statutes of the State of Maryland at the time in force, be lawfully contained in articles of incorporation may be added or inserted, upon the vote of the holders of a majority of the shares of common stock of the Corporation at the time outstanding and entitled to vote, and all rights at any time conferred upon the stockholders of the Corporation by these Articles of Incorporation are subject to the provisions of this Article VIII. --------------------- The term "Articles of Incorporation" as used herein and in the By-Laws of the Corporation shall be deemed to mean these Articles of Incorporation as from time to time amended and restated. --------------------- I acknowledge this document to be my act, and state under the penalties of perjury that with respect to all matters and facts herein, to the best of my knowledge, information and belief such matters and facts are true in all material respects and that this statement is made under the penalties of perjury. February 9, 1987. /s/ Warren J. Olsen ---------------------- Warren J. Olsen 6 STATE OF NEW YORK ) : ss: COUNTY OF NEW YORK ) THIS IS TO CERTIFY that on this 9th day of February, 1987 before me, the subscriber a Notary Public in and for the State of New York, personally appeared WARREN J. OLSEN and acknowledged the foregoing Amended Articles of Incorporation of First Boston Strategic Income Fund, Inc. to be his act and deed and that the facts therein stated are truly set forth. WITNESS my hand and Notarial Seal the day and year last above written. /s/ Illegible ---------------------- Notary Public 7 AMENDED ARTICLES OF INCORPORATION OF FIRST BOSTON QUALITY INCOME FUND, INC. ARTICLE I. I, the incorporator, Warren J. Olsen, whose post office address is 250 Park Avenue, New York, New York 10177, being at least eighteen years of age, am, under and by virtue of the General Laws of the State of Maryland authorizing the formation of corporations, forming a corporation. ARTICLE II. The name of the corporation (hereinafter called the "Corporation") is FIRST BOSTON INCOME FUND, INC. ARTICLE III. PURPOSES The purpose for which the Corporation is formed is to act as a closed-end, diversified investment company of the management type registered as such with the Securities and Exchange Commission pursuant to the Investment Company Act of 1940 and to exercise and generally to enjoy all of the powers, rights and privileges granted to, or conferred upon, corporations by the General Laws of the State of Maryland now or hereafter in force. 8 ARTICLE IV. ADDRESS IN MARYLAND The post office address of the place at which the principal office of the Corporation in the State of Maryland is located is c/o The Corporation Trust Incorporated, 32 South Street, Baltimore, Maryland 21202. The name of the Corporation's resident agent is the Corporation Trust Incorporated, and its post office address is 32 South Street, Baltimore, Maryland 21202. Said resident agent is a corporation of the State of Maryland. ARTICLE V. COMMON STOCK Section 1. The total number of shares of stock which the Corporation has authority to issue is 100,000,000 shares of common stock of the par value of $0.001 each, all of one class, having an aggregate par value of $100,000. Section 2. The presence in person or by proxy of the holders of record of one-third of the shares of commn stock issued and outstanding and entitled to vote thereat shall constitute a quorum for the transaction of any business at all meetings of the stockholders except as otherwise provided by law or in these Articles of Incorporation. Section 3. Notwithstanding any provision of the General Laws of the State of Maryland requiring action to be taken or authorized by the affirmative vote of the holders of a designated proportion greater than a majority of the shares of common stock, such action shall be valid and effective if taken or authorized by the affirmative vote of the holders of a majority of the total number of shares of common stock outstanding and entitled to vote thereupon pursuant to the provisions of these Articles of Incorporation. 9 Section 4. No holder of shares of common stock of the Corporation shall, as such holder, have any preemptive right to purchase or subscribe for any shares of the common stock of the Corporation of any class which it may issue or sell. Section 5. All persons who shall acquire common stock in the Corporation shall acquire the same subject to the provisions of these Articles of Incorporation. ARTICLE VI. DIRECTORS The initial number of directors of the Corporation shall be three, and the names of those who shall act as such until the first annual meeting and until their successors are duly elected and qualify are as follows: Michael F. Holland, Robert M. Baylis and James L. Freeman. However, the By-Laws of the Corporation may fix the number of directors at a number other than three and may authorize the Board of Directors, by the vote of a majority of the entire Board of Directors, to increase or decrease the number of directors within a limit specified in the By-Laws, provided that in no case shall the number of directors be less than three, and to fill the vacancies created by any such increase in the number of directors. Unless otherwise provided by the By-Laws of the Corporation, the directors of the Corporation need not be stockholders. The By-Laws of the Corporation may divide the Directors of the Corporation into classes and prescribe the tenure of office of the several classes; but no class shall be elected for a period shorter than that from the time of the election of such class until the next annual meeting and thereafter for a period shorter than the interval between annual meetings or for a longer period than five years, and the term of office of at least one class shall expire each year. 10 ARTICLE VII. MANAGEMENT OF THE AFFAIRS OF THE CORPORATION Section 1. All corporate powers and authority of the Corporation (except as at the time otherwise provided by statute, by these Articles of Incorporation or by the By-Laws) shall be vested in and exercised by the Board of Directors. Section 2. The Board of Directors shall have the power to adopt, alter or repeal the By-Laws of the Corporation except to the extent that the By-Laws otherwise provide. Section 3. The Board of Directors shall have the power from time to time to determine whether and to what extent, and at what times and places and under what conditions and regulations, the accounts and books of the Corporation (other than the stock ledger) or any of them shall be open to the inspection of stockholders; and no stockholder shall have any right to inspect any account, book or document of the Corporation except to the extent permitted by statute or the By-Laws. Section 4. The Board of Directors shall have the power to determine, as provided herein, or if provision is not made herein, in accordance with generally accepted accounting principles, what constitutes net income, total assets and the net asset value of the shares of Common Stock of the Corporation. Section 5. The Board of Directors shall have the power to distribute dividends from funds legally available therefor in such amounts, if any, and in such manner to the stockholders of record as of such date, as the Board of Directors may determine. ARTICLE VIII. Section 1. Provided that reasonable care has been exercised in the selection of the officers, other employees, investment advisors and managers, distributors, underwriters, 11 selling agents, custodians, dividend disbursing agents, transfer agents and registrars, legal counsel, auditors, and other agents of the Corporation, no director of the Corporation shall be responsible or liable in any event for any neglect or wrong-doing of any of the same, nor shall any director be responsible or liable for the act or omission to act of any other director. Section 2. Each officer or director or member of any committee designated by the Board of Directors shall, in the performance of his duties, be fully protected in relying in good faith upon the books of account of or reports made to the Corporation by any of its officials or by an independent public accountant or by an appraiser selected with reasonable care by the Board of Directors or by any such committee and in relying in good faith upon other records of the Corporation. Section 3. The Corporation shall indemnify its directors and officers to the fullest extent allowed, and in the manner provided by Maryland law, including the advancing of expenses incurred in connection therewith. Such indemnification shall be in addition to any other right or claim to which any director or officer may otherwise be entitled. The Corporation may purchase and maintain insurance on behalf of any person who is or was a director, officer, employee, or agent of the Corporation, or who, while a director, officer, employee or agent of the Corporation, is or was serving at the request of the Corporation as a director, officer, partner, trustee, employee, or agent of another foreign or domestic corporation, partnership, joint venture, trust, other enterprise, or employee benefit plan, against any liability asserted against and incurred by such person in any such capacity or arising out of such person's position, whether or not the Corporation would have had the power to indemnify such liability. Section 4. Nothing in this Article protects or purports to protect, any director or officer against any liability to the Corporation or its security holders to which he or she would 12 otherwise be subject by reason of willful misfeasance, bad faith, gross negligence or reckless disregard of the duties involved in the conduct of his or her office. Section 5. Each section or portion thereof of this Article shall be deemed severable from the remainder, and the invalidity of any such section or portion shall not affect the validity of the remainder of this Article. ARTICLE IX. The duration of the Corporation shall be perpetual. ARTICLE X. AMENDMENTS From time to time any of the provisions of these Articles of Incorporation may be amended, altered or repealed (including any amendment that changes the terms of any of the outstanding stock by classification, reclassification or otherwise), and other provisions that may, under the statutes of the State of Maryland at the time in force, be lawfully contained in articles of incorporation may be added or inserted, upon the vote of the holders of a majority of the shares of common stock of the Corporation at the time outstanding and entitled to vote, and all rights at any time conferred upon the stockholders of the Corporation by these Articles of Incorporation are subject to the provisions of this Article X. ------------------------- The term "Articles of Incorporation" as used herein and in the By-Laws of the Corporation shall be deemed to mean these Articles of Incorporation as from time to time amended and restated. -------------------------- 13 I acknowledge this document to be my act, and state under the penalties of perjury that with respect to all matters and facts herein, to the best of my knowledge, information and belief such matters and facts are true in all material respects and that this statement is made under the penalties of perjury. March 9, 1987 /s/Warren J. Olsen ---------------------- Warren J. Olsen 14 STATE OF NEW YORK ) : ss: COUNTY OF NEW YORK ) THIS IS TO CERTIFY that on this 9th day of March, 1987 before me, the subscriber a Notary Public in and for the State of New York, personally appeared WARREN J. OLSEN and acknowledged the foregoing Amended Articles of Incorporation of First Boston Income Fund, Inc. to be his act and deed and that the facts therein stated are truly set forth. WITNESS my hand and Notarial Seal the day and year last above written. /s/Mary McMillan ---------------------- Notary Public 15 Articles of Amendment of Articles of Incorporation of FIRST BOSTON INCOME FUND, INC. FIRST BOSTON INCOME FUND, INC., a Maryland corporation (the "Corporation"), having its principal office in Baltimore, Maryland, hereby certifies to the State Department of Assessments and Taxation of Maryland that: FIRST: The Corporation's Articles of Incorporation are hereby amended as follows: 1. Article EIGHTH, Section 3 is hereby amended by deleting it in its entirety and replacing it with the following: The Fund shall indemnify to the fullest extent permitted by law (including the Investment Company Act of 1940) as currently in effect or as may hereafter be amended, any person made or threatened to be made a party to any action, suit or proceeding, whether criminal, civil, administrative or investigative, by reason of the fact that such person or such person's testator or intestate is or was a Director or Officer. To the fullest extent permitted by law (including the Investment Company Act of 1940) as currently in effect or as the same may hereafter be amended, expenses incurred by any such person in defending any such action, suit or proceeding shall be paid or reimbursed by the Fund promptly upon receipt by it of an undertaking of such person to repay such expenses if it shall ultimately be determined that such person is not entitled to be indemnified by the Fund. Before the Fund may advance such expenses, one of the following provisions must be satisfied: 1) such Director or Officer shall provide a security for his undertaking, 2) the Fund shall be insured against losses arising by reason of any lawful advances, or 3) a majority of a quorum of disinterested, non-party directors of the Fund, or an independent legal counsel in a written opinion, shall determine, based on a review of readily available facts, that there is reason to believe that such Director or Officer ultimately will be found entitled to indemnification. The rights provided to any person by this Section of this Article shall be enforceable against the Fund by such person who shall be presumed to have relied upon it in serving or 16 continuing to serve as a Director or Officer as provided above. No amendment of this Section of this Article shall impair the rights of any person arising at any time with respect to events occurring prior to such amendment. For purposes of this Section of this Article, the term "Fund" shall include any predecessor of the Fund and any constituent corporation (including any constituent of a constituent) absorbed by the Fund in a consolidation or merger; the term "other enterprise" shall include any corporation, partnership, joint venture, trust or employee benefit plan; service "at the request of the Fund" shall include service as a Director or Officer of the Fund which imposes duties on, or involves services by, such Director or Officer with respect to an employee benefit plan, its participants or beneficiaries; any excise taxes assessed on a person with respect to an employee benefit plan, its participants or beneficiaries; any excise taxes assessed on a person with respect to an employee benefit plan shall be deemed to be indemnifiable expenses; and action by a person with respect to any employee benefit plan which such person reasonably believes to be in the interest of the participants and beneficiaries of such plan shall be deemed to be action not opposed to the best interests of the Fund. 2. Article EIGHTH is hereby amended by adding the following Section 5: Section 5. A Director or Officer of the Fund shall not be liable to the Fund or its stockholders for monetary damages for breach of fiduciary duty as a Director or Officer, except to the extent such exemption from liability or limitation thereof is not permitted by law (including the Investment Company Act of 1940 and rules or regulations thereunder or any releases issued by the Securities and Exchange Commission or its staff) as currently in effect or as the same may hereafter be amended. SECOND: The foregoing amendment to the Articles of Incorporation of the Corporation has been advised by the Board of Directors and approved by the stockholders in the manner required by law and its Articles of Incorporation. 17 IN WITNESS WHEREOF, FIRST BOSTON INCOME FUND, INC. has caused these Articles of Amendment of Articles of Incorporation to be signed in the name and on its behalf by its President and witnessed by its Assistant Secretary this 10th day of June, 1991. FIRST BOSTON INCOME FUND, INC. BY /s/Edward N. McMillan -------------------------- Edward N. McMillan President WITNESS: /s/Susanne M. Dennis - ---------------------- Susanne M. Dennis Assistant Secretary 18 THE UNDERSIGNED, President of FIRST BOSTON INCOME FUND, INC., who executed on behalf of the Corporation the foregoing Articles of Amendment of which this certificate is made a part, hereby acknowledges in the name and on behalf of said Corporation the foregoing Articles of Amendment to be the corporate act of said Corporation and hereby certifies that to the best of his knowledge, information, and belief the matters and facts set forth therein with respect to the authorization and approval thereof are true in all material respects under the penalties of perjury. /s/Edward N. McMillan ---------------------- Edward N. McMillan President 19 ARTICLES OF AMENDMENT to ARTICLES OF INCORPORATION of FIRST BOSTON INCOME FUND, INC. THIS IS TO CERTIFY that FIRST BOSTON INCOME FUND, INC., a Maryland corporation having its principal office in Baltimore City, Maryland (hereinafter called the "Corporation"), hereby certifies to the State Department of Assessments and Taxation of Maryland, that: FIRST: The Corporation's Articles of Incorporation are hereby amended as follows: The name of the Corporation is hereby changed from "First Boston Income Fund, Inc." to "CS First Boston Income Fund, Inc." SECOND: The foregoing amendment to the Articles of Incorporation of the Corporation has been advised by the Board of Directors and approved by the stockholders of the Corporation in the manner required by law and its Articles of Incorporation. 20 IN WITNESS WHEREOF, FIRST BOSTON INCOME FUND, INC., has caused these Articles of Amendment to Articles of Incorporation to be signed in its name and on its behalf by its Chairman, John J. Cook, Jr., and witnessed by its Assistant Secretary, James P. Pappas, and each of said officers of the Corporation has also acknowledged these Articles of Amendment to be the corporate act of the Corporation and has stated under penalties of perjury that to the best of said officer's knowledge, information and belief the matters and facts set forth with respect to approval are true in all material respects, all on May 24, 1994. FIRST BOSTON INCOME FUND, INC. By: /s/John J. Cook, Jr. ----------------------------------- Name: John J. Cook, Jr. Title: President and Chairman Witness: /s/James P. Pappas - --------------------------------- Name: James P. Pappas Title: Assistant Secretary 21 CS FIRST BOSTON REALTY, INC. 55 E. 52 Street New York, New York 10055 June 8, 1994 Maryland State Department of Assessments and Taxation 301 West Preston Street Baltimore, MD 21201 Re: Consent to use of "CS First Boston" name by First Boston Income Fund, Inc. To the Department of Assessments and Taxation: We have been informed by CT Corporation System that the use by CS First Boston Realty, Inc. of the "CS First Boston" designation prevents First Boston Income Fund, Inc. from adopting a name change in Maryland to CS First Boston Income Fund, Inc. without first obtaining the consent of this company. CS First Boston Realty, Inc. hereby authorizes First Boston Income Fund, Inc. to use, in Maryland, the "CS First Boston" designation so that it may amend its name to CS First Boston Income Fund, Inc. Please call me at (212) 322-7205 if you have any questions regarding this authorization. Sincerely, /s/Lori M. Russo - ---------------- Lori M. Russo, Assistant Secretary LMR/pt cc: Charles Griemsman (CS First Boston Investment Management Corporation) Stuart B. Leichenko, Esq. (Sullivan & Cromwell) 22 ARTICLES OF AMENDMENT to ARTICLES OF INCORPORATION of CS FIRST BOSTON INCOME FUND, INC. THIS IS TO CERTIFY that CS FIRST BOSTON INCOME FUND, INC., a Maryland corporation having its principal office in Baltimore City, Maryland (hereinafter called the "Corporation"), hereby certifies to the State Department of Assessments and Taxation of Maryland, that: FIRST: Article First of the Corporation's Articles of Incorporation are hereby amended as follows: The name of the Corporation is "BEA Income Fund, Inc." SECOND: The foregoing amendment to the Articles of Incorporation of the Corporation has been advised by the Board of Directors and approved by the stockholders of the Corporation in the manner required by law and its Articles of Incorporation. 23 IN WITNESS WHEREOF, CS FIRST BOSTON INCOME FUND, INC., has caused these Articles of Amendment to Articles of Incorporation to be signed in its name and on its behalf by its President, Robert Moore, and witnessed by its Secretary, Hal Liebes, and each of said officers of the Corporation has also acknowledged these Articles of Amendment to be the corporate act of the Corporation and has stated under penalties of perjury that to the best of said officer's knowledge, information and belief the matters and facts set forth with respect to approval are true in all material respects, all on June 13, 1995. CS FIRST BOSTON INCOME FUND, INC. By: /s/Robert J. Moore ---------------------------- Name: Robert J. Moore Title: President Witness: /s/Hal Liebes - ----------------- Name: Hal Liebes Title: Secretary 24 ARTICLES OF AMENDMENT to ARTICLES OF INCORPORATION of CS FIRST BOSTON INCOME FUND, INC. THIS IS TO CERTIFY that CS FIRST BOSTON INCOME FUND, INC., a Maryland corporation having its principal office in Baltimore City, Maryland (hereinafter called the "Corporation"), hereby certifies to the State Department of Assessments and Taxation of Maryland, that: FIRST: Article First of the Corporation's Articles of Incorporation are hereby amended as follows: The name of the Corporation is "BEA Income Fund, Inc." SECOND: The foregoing amendment to the Articles of Incorporation of the Corporation has been advised by the Board of Directors and approved by the stockholders of the Corporation in the manner required by law and its Articles of Incorporation. 25 IN WITNESS WHEREOF, CS FIRST BOSTON INCOME FUND, INC., has caused these Articles of Amendment to Articles of Incorporation to be signed in its name and on its behalf by its President, Robert Moore, and witnessed by its Secretary, Hal Liebes, and each of said officers of the Corporation has also acknowledged these Articles of Amendment to be the corporate act of the Corporation and has stated under penalties of perjury that to the best of said officer's knowledge, information and belief the matters and facts set forth with respect to approval are true in all material respects, all on June 13, 1995. CS FIRST BOSTON INCOME FUND, INC. By: /s/ Robert J. Moore ----------------------- Name: Robert J. Moore Title: President Witness: /s/ Hal Liebes Name: Hal Liebes Title: Secretary 26 ARTICLES OF AMENDMENT to ARTICLES OF INCORPORATION of BEA INCOME FUND, INC. BEA Income Fund, Inc., a Maryland corporation having its principal office in Baltimore City, Maryland (hereinafter called the "Corporation"), hereby certifies to the State Department of Assessments and Taxation of Maryland that: FIRST: The charter of the Corporation, as heretofore amended, is further amended to change the name of the Corporation to Credit Suisse Asset Management Income Fund, Inc. and by striking ARTICLE II of the Articles of Incorporation in its entirety and inserting in lieu thereof the following: ARTICLE II The name of the corporation (hereinafter called the "Corporation") is Credit Suisse Asset Management Income Fund, Inc. SECOND: The foregoing amendment to the Articles of Incorporation of the Corporation has been advised by the Board of Directors and approved by the stockholders of the Corporation in the manner and by the vote required by law and its charter. IN WITNESS WHEREOF, Credit Suisse Asset Management Income Fund, Inc. has caused these Articles of Amendment to be signed in its name and on its behalf by its Senior Vice President and witnessed by its Secretary as of the 11th day of May, 1999. The undersigned acknowledges these Articles of Amendment to be the corporate act of the Corporation and states that, to the best of his knowledge, information and belief, all matters and facts set forth herein with respect to the authorization and approval of the Articles of 27 Amendment are true and in all material respects and that this statement is made under penalties of perjury. BEA INCOME FUND, INC. By: /s/ Hal Liebes ------------------------------------ Name: Hal Liebes Title: Senior Vice President WITNESS: /s/ Michael A. Pignataro Name: Michael A. Pignataro Title: Secretary 28 REGISTRAR, TRANSFER AGENCY AND SERVICE AGREEMENT BETWEEN BEA INCOME FUND, INC. AND BANKBOSTON, N.A. TABLE OF CONTENTS PAGE ARTICLE 1 TERMS OF APPOINTMENT; DUTIES OF THE BANK...............1 ARTICLE 2 FEES AND EXPENSES......................................3 ARTICLE 3 REPRESENTATIONS AND WARRANTIES OF THE BANK.............3 ARTICLE 4 REPRESENTATIONS AND WARRANTIES OF THE FUND.............4 ARTICLE 5 DATA ACCESS AND PROPRIETARY INFORMATION................5 ARTICLE 6 INDEMNIFICATION........................................6 ARTICLE 7 STANDARD OF CARE.......................................8 ARTICLE 8 COVENANTS OF THE FUND AND THE BANK.....................8 ARTICLE 9 TERMINATION OF AGREEMENT...............................9 ARTICLE 10 ASSIGNMENT............................................10 ARTICLE 11 AMENDMENT.............................................10 ARTICLE 12 MASSACHUSETTS LAW TO APPLY............................10 ARTICLE 13 FORCE MAJEURE.........................................10 ARTICLE 14 CONSEQUENTIAL DAMAGES.................................11 ARTICLE 15 MERGER OF AGREEMENT...................................11 ARTICLE 16 SURVIVAL..............................................11 ARTICLE 17 SEVERABILITY..........................................11 ARTICLE 18 COUNTERPARTS..........................................11 EX-99.13(A) 3 0003.txt TRANSFER AGENCY AND SERVICE AGREEMENT REGISTRAR, TRANSFER AGENCY AND SERVICE AGREEMENT BETWEEN BEA INCOME FUND, INC. AND BANKBOSTON, N.A. TABLE OF CONTENTS PAGE ARTICLE 1 TERMS OF APPOINTMENT; DUTIES OF THE BANK...............1 ARTICLE 2 FEES AND EXPENSES......................................3 ARTICLE 3 REPRESENTATIONS AND WARRANTIES OF THE BANK.............3 ARTICLE 4 REPRESENTATIONS AND WARRANTIES OF THE FUND.............4 ARTICLE 5 DATA ACCESS AND PROPRIETARY INFORMATION................5 ARTICLE 6 INDEMNIFICATION........................................6 ARTICLE 7 STANDARD OF CARE.......................................8 ARTICLE 8 COVENANTS OF THE FUND AND THE BANK.....................8 ARTICLE 9 TERMINATION OF AGREEMENT...............................9 ARTICLE 10 ASSIGNMENT............................................10 ARTICLE 11 AMENDMENT.............................................10 ARTICLE 12 MASSACHUSETTS LAW TO APPLY............................10 ARTICLE 13 FORCE MAJEURE.........................................10 ARTICLE 14 CONSEQUENTIAL DAMAGES.................................11 ARTICLE 15 MERGER OF AGREEMENT...................................11 ARTICLE 16 SURVIVAL..............................................11 ARTICLE 17 SEVERABILITY..........................................11 ARTICLE 18 COUNTERPARTS..........................................11 REGISTRAR, TRANSFER AGENCY AND SERVICE AGREEMENT This Transfer Agency and Stock Transfer Services Agreement (the "Agreement"), dated as of October 26, 1998, or upon commencement of services described below as soon as is practical following October 26,1998, is between BEA Income Fund, Inc., a Maryland corporation (the "Fund") and BankBoston, N.A. (the "Bank"), a national banking association. WHEREAS, the Fund desires to appoint the Bank as its registrar, transfer agent, dividend disbursing agent and agent in connection with certain other activities and the Bank desires to accept such appointment; NOW, THEREFORE, in consideration of the mutual covenants herein contained, the parties hereto agree as follows: ARTICLE 1 TERMS OF APPOINTMENT; DUTIES OF THE BANK 1.01 Subject to the terms and conditions set forth in this Agreement, the Fund hereby employs and appoints the Bank to act as, and the Bank agrees to act as registrar, transfer agent for the Fund's authorized and issued shares of its common stock ("Shares"), dividend disbursing agent and agent in connection with any dividend reinvestment plan as set out in the prospectus of the Fund, corresponding to the date of this Agreement. 1.02 The Bank agrees that it will perform the following services: (a) In accordance with procedures established from time to time by agreement between the Fund and the Bank, the Bank shall: (i) Issue and record the appropriate number of Shares as authorized and hold such Shares in the appropriate Shareholder account; (ii) Effect transfers of Shares by the registered owners thereof upon receipt of appropriate documentation; (iii) Prepare and transmit payments for dividends and distributions declared by the Fund; (iv) Act as agent for Shareholders pursuant to the dividend reinvestment and cash purchase plan of the Fund as amended from time to time; (v) Issue replacement certificates for those certificates alleged to have been lost, stolen or destroyed upon receipt by the Bank of indemnification satisfactory to the Bank and protecting the Bank and the Fund, and the Bank at its option, may issue replacement certificates in place of mutilated stock certificates upon presentation thereof and without such indemnity. (b) In addition to and neither in lieu nor in contravention of the services set forth in the above paragraph (a), the Bank shall: (i) perform all of the customary services of a registrar, transfer agent, dividend disbursing agent and agent of the dividend reinvestment and cash purchase plan as described in Article 1 consistent with those requirements in effect as of the date of this Agreement. The detailed definition, frequency, limitations and associated costs (if any) set out in the attached fee schedule, include but are not limited to: maintaining all Shareholder accounts, preparing Shareholder meeting lists, mailing proxies, and mailing Shareholder reports to current Shareholders, withholding taxes on U.S. resident and non-resident alien accounts where applicable, preparing and filing U.S. Treasury Department Forms 1099 and other appropriate forms required with respect to dividends and distributions by federal authorities for all registered Shareholders. 2 (c) The Bank shall provide additional services on behalf of the Fund (i.e., escheatment winces) which may be agreed upon in writing between the Fund and the Bank. ARTICLE 2 FEES AND EXPENSES 2.01 For the performance by the Bank pursuant to this Agreement, the Fund agrees to pay the Bank an annual maintenance fee as set out in the initial fee schedule attached hereto. Such fees and out-of-pocket expenses and advances identified under Section 2.02 below may be changed from time to time subject to mutual written agreement between the Fund and the Bank. 2.02 In addition to the foe paid under Section 2.01 above, the Fund agrees to reimburse the Bank for out-of-pocket expenses, including but not limited to confirmation production, postage, forms, telephone, microfilm, microfiche, tabulating proxies, records storage, or advances incurred by the Bank for the items set out in the fee schedule attached hereto. In addition, any other expenses incurred by the Bank at the request or with the consent of the Fund, will be reimbursed by the Fund. 2.03 The Fund agrees to pay all few and reimbursable expenses within five days following the receipt of the respective billing notice. Postage and the cost of materials for mailing of dividends, proxies, Fund reports and other mailings to all Shareholder accounts shall be advanced to the Bank by the Fund at least seven (7) days prior to the mailing date of such materials. ARTICLE 3 REPRESENTATIONS AND WARRANTIES OF THE BANK The Bank represents and warrants to the Fund that: 3.01 It is a trust company duly organized and existing and in good standing under the laws of the Commonwealth of Massachusetts. 3 3.02 It is duly qualified to carry on its business in the Commonwealth of Massachusetts. 3.03 It is empowered under applicable laws and by its Charter and By-Laws to enter into and perform this Agreement. 3.04 All requisite corporate proceedings have been taken to authorize it to enter into and perform this Agreement. 3.05 It has and will continue to have access to the necessary facilities, equipment and personnel to perform its duties and obligations under this Agreement. ARTICLE 4 REPRESENTATIONS AND WARRANTIES OF THE FUND The Fund represents and warrants to the Bank that: 4.01 It is a corporation duly organized and existing and in good standing under the laws of Maryland. 4.02 It is empowered under applicable laws and by its Articles of Incorporation and By-Laws to enter into and perform this Agreement. 4.03 All corporate proceedings required by said Articles of Incorporation and By-Laws have been taken to authorize it to enter into and perform this Agreement. 4.04 It is a closed-end, diversified investment company registered under the Investment Company Act of 1940, as amended. 4.05 To the extent required by federal securities laws a registration statement under the Securities Act of 1933, as amended is currently or will be effective and appropriate state securities law filings have been made with respect to all Shares of the Fund being offered for sale by the Fund; information to the contrary will result in immediate notification to the Bank. 4.06 It shall make all required filings under federal and state securities laws. 4 ARTICLE 5 DATA ACCESS AND PROPRIETARY INFORMATION 5.01 The Fund acknowledges that the data bases, computer programs, screen formats, report formats, interactive design techniques, and other proprietary information furnished to the Fund by the Bank are provided solely in connection with the services rendered under this Agreement and constitute copyrighted trade secrets or proprietary information of substantial value to the Bank. Such databases, programs, formats, designs and techniques are collectively referred to below as "Proprietary Information." The Fund agrees that it shall treat all Proprietary Information as proprietary to the Bank and further agrees that it shall not divulge any Proprietary Information to any person or organization except as expressly permitted hereunder. The Fund agrees for itself and its employees and agents: (a) to use such programs and databases (i) solely on the Fund computers, or (ii) solely from equipment at the locations agreed to between the Fund and the Bank and (iii) in accordance with the Bank's applicable user documentation; (b) to refrain, from copying or duplicating in any way (other than in the normal course of performing processing on the Funds' computers) any part of any Proprietary Information; (c) to refrain from obtaining unauthorized access to any programs, data or other information not owned by the Fund, and if such access is accidentally obtained, to respect and safeguard the same Proprietary Information; (d) to refrain from causing or allowing proprietary information transmitted from the Bank's computer to the Funds' terminal to be retransmitted to any other computer terminal or other device except as expressly permitted by the Bank (such permission not to be unreasonably withheld); 5 (e) that the Fund shall have access only to those authorized transactions as agreed to between the Fund and the Bank; and (f) to honor reasonable written requests made by the Bank to protect at the Bank's expense the rights of the Bank in Proprietary Information at common law and under applicable statutes. 5.02 If the transactions available to the Fund include the ability to originate electronic instructions to the Bank in order to (i) effect the transfer or movement of cash or Shares or (ii) transmit Shareholder information or other information, then in such event the Bank shall be entitled to rely on the validity and authenticity of such instruction without undertaking any further inquiry as long as such instruction is undertaken in conformity with security procedures established by the Bank from time to time. ARTICLE 6 INDEMNIFICATION 6.01 The Bank shall not be responsible for, and the Fund shall indemnify and hold the Bank harmless from and against, any and all losses, damages, costs, charges, counsel fees, payments, expenses and liability arising out of or attributable to: (a) All actions of the Bank or its agents or subcontractors required to be taken pursuant to this Agreement, provided that such actions are taken in good faith and without negligence or willful misconduct. (b) The Fund's lack of good faith, negligence or willful misconduct which arise out of the breach of any representation or warranty of the Fund hereunder. (c) The reliance on or use by the Bank or its agents or subcontractors of information, records, documents or services which (i) are received by the Bank or its agents or subcontractors, and (ii) have been prepared, maintained or performed by the Fund or any other 6 person or firm on behalf of the Fund including but not limited to any previous transfer agent registrar. (d) The reliance on, or the carrying out by the Bank or its agents or subcontractors of, any instructions or requests of the Fund. (e) The offer or sale of Shares in violation of any federal or state securities laws requiring that such shares be registered or in violation of any stop order or other determination or ruling by any federal or state agency with respect to the offer or sale of such Shares. 6.02 At any time the Bank may apply to any officer of the Fund for instructions, and may consult with legal counsel with respect to any matter arising in connection with the services to be performed by the Bank under this Agreement, and the Bank and its agents or subcontractors shall not be liable and shall be indemnified by the Fund for any action taken or omitted by it in reliance upon such instructions or upon the opinion of such counsel. The Bank, its agents and subcontractors shall be protected and indemnified in acting upon any paper or document furnished by or on behalf of the Fund, reasonably believed to be genuine and to have been signed by the proper person or persons, or upon any instruction, information, data, records or documents provided the Bank or its agents or subcontractors by telephone, in person, machine readable input telex, CRT data entry or other similar means authorized by the Fund, and shall not be held to have notice of any change of authority of any person, until receipt of written notice thereof from the Fund. The Bank, its agents and subcontractors shall also be protected and indemnified in recognizing stock certificates which are reasonably believed to bear the proper manual or facsimile signatures of the officers of the Fund, and the proper countersignature of any former transfer agent or former registrar, or of a co-transfer agent or co-registrar. 7 6.03 in order that the indemnification provisions contained in this Article 6 shall apply, upon the assertion of a claim for which the Fund may be required to indemnify the Bank, the Bank shall promptly notify the Fund of such assertion, and shall keep the Fund advised with respect to all developments concerning such claim. The Fund shall have the option to participate with the Bank in the defense of such claim or to defend against said claim in its own name or in the name of the Bank. The Bank shall in no case confess any claim or make any compromise in any case in which the Fund may be required to indemnify the Bank except with the Fund's prior written consent. ARTICLE 7 STANDARD OF CARE 7.01 The Bank shall at all times act in good faith and agrees to use its best efforts within reasonable limits to insure the accuracy of all services performed under this Agreement, but assumes no responsibility and shall not be liable for loss or damage due to errors unless said errors are caused by its negligence, bad faith, or willful misconduct or that of its employees. ARTICLE 8 COVENANTS OF THE FUND AND THE BANK 8.01 The Fund shall promptly furnish to the Bank the following: (a) A certified copy of the resolution of the Board of Directors of the Fund authorizing the appointment of the Bank and the execution and delivery of this Agreement. (b) A copy of the Articles of Incorporation and By-Laws of the Fund and all amendments thereto. 8.02 The Bank hereby agrees to establish and maintain facilities and procedures reasonably acceptable to the Fund for safekeeping of stock certificates, check forms and facsimile signature imprinting devices, if any; and for the preparation or use, and for keeping account of, such certificates, forms and devices. 8 8.03 The Bank shall keep records relating to the services to be performed hereunder, in the form and manner as it may deem advisable. To the extent required by Section 31 of the Investment Company Act of 1940, as amended, and the Rules thereunder, the Bank agrees that all such records prepared or maintained by the Bank relating to the services to be performed by the Bank hereunder are the property of the Fund and will be preserved, maintained and made available in accordance with such Section and Rules, and will be surrendered promptly to the Fund on and in accordance with its request. 8.04 The Bank and the Fund agree that all books, records, information and data pertaining to the business of the other party which are exchanged or received pursuant to the negotiation or the carrying out of this Agreement shall remain confidential, and shall not be voluntarily disclosed to any other pawn, except as may be required by law. 8.05 In cases of any requests or demands for the inspection of the Shareholder records of the Fund, the Bank will endeavor to notify the Fund and to secure instructions from an authorized officer of the Fund as to such inspection. The Bank reserves the right, however, to exhibit the Shareholder records to any person whenever it is advised by its counsel that it may be held liable for the failure to exhibit the Shareholder records to such person. ARTICLE 9 TERMINATION OF AGREEMENT 9.01 This Agreement may be terminated by either party upon ninety (90) days written notice to the other. 9.02 Should the Fund exercise its right to terminate, all out-of-pocket expenses associated with the movement of records and material will be borne by the Fund. Additionally, the Bank reserves the right to charge for any other reasonable expenses associated with such termination and/or a charge, equivalent to the average of three (3) months' fees. 9 ARTICLE 10 ASSIGNMENT 10.01 Except as provided in Section 10.03 below, neither this Agreement nor any rights or obligations hereunder may be assigned by either party without the written consent of the other party. 10.02 This Agreement shall inure to the benefit of and be binding upon the parties and their respective permitted successors and assigns. 10.03 The Bank may, without further consent on the part of the Fund, subcontract for the performance hereof with (i) Boston EquiServe Limited Partnership, a Delaware limited partnership ("Boston EquiServe"), which is duly registered as a transfer agent pursuant to Section 17A(c)(2) of the Securities Exchange Act of 1934 ("Section 17A(c)(2)"), or (ii) a Boston EquiServe affiliate duly registered as a transfer agent pursuant to Section 17A(c)(2), provided, however, that the Bank shall be as fully responsible to the Fund for the acts and omissions of any subcontractor as it is for its own acts and omissions. ARTICLE 11 AMENDMENT 11.01 This Agreement may be amended or modified by a written agreement executed by both parties and authorized or approved by a resolution of the Board of Directors of the Fund. ARTICLE 12 MASSACHUSETTS LAW TO APPLY 12.01 This Agreement shall be construed and the provisions thereof interpreted under and in accordance with the laws of The Commonwealth of Massachusetts. ARTICLE 13 FORCE MAJEURE 13.01 In the event either party is unable to perform its obligations under the terms of this Agreement because of acts of God, strikes, equipment or transmission failure or damage reasonably beyond its control, or other causes reasonably beyond its control, such party 10 shall not be liable for damages to the other for any damages arising from such failure to perform or otherwise from such causes. ARTICLE 14 CONSEQUENTIAL DAMAGES 14.01 Neither party to this Agreement shall be liable to the other party for consequential damages under any provision of this Agreement or for any consequential damages arising out of any act or failure to act hereunder. ARTICLE 15 MERGER OF AGREEMENT 15.01 This Agreement constitutes the entire agreement between the parties hereto and supersedes any prior agreement with respect to the subject hereof whether oral or written. ARTICLE 16 SURVIVAL 16.01 All provisions regarding indemnification, warranty, liability and limits thereon, and confidentiality and/or protection of proprietary rights and trade secrets, shall survive the termination of this Agreement. ARTICLE 17 SEVERABILITY 17.01 If any provision or provisions of this Agreement shall be held to be invalid, unlawful, or unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired. ARTICLE 18 COUNTERPARTS 18.01 This Agreement may be executed by the parties hereto on any number of counterparts, and all of said counterparts taken together shall be deemed to constitute one and the same instrument. 11 IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed in their names and on their behalf by and through their duly authorized officers, as of the day and year first above written. BEA INCOME FUND, INC. By: /S/ MICHAEL A. ? --------------------- Michael A.? Secretary BANKBOSTON, N.A. By: /S/ JOSEPH F. IDZAL --------------------- Joseph F. Idzal Vice President 12 FEE AND SERVICE SCHEDULE FOR BEA INCOME FUND, INC. - ------------------------------------------------------------------------------- STANDARD TRANSFER AGENT AND REGISTRAR FEES AND SERVICES TERM The term of this Fee and Service Schedule shall be for a period of three (3) years, commencing from October 26, 1998, the effective date of this Fee and Service Schedule (the "Initial Term"). After the Initial Term, this Fee and Service Schedule shall be self renewing, and providing that the service mix and volumes remain constant, the fees listed below shall be increased by the accumulated change in the National Employment Cost Index for Service Producing Industries (Finance, Insurance, Real Estate) for the preceding years of the contract, as published by the Bureau of Labor Statistics of the United States Department of Labor. Fees will be increased on this basis on each successive contract anniversary thereafter. Notwithstanding the paragraphs above, the fees and services may be changed from time to time as agreed upon in writing by both parties. FEES AND SERVICES TRANSFER AGENT AND REGISTRAR FEE $2,750.00 Per Month - Includes the standard Transfer Agent and Registrar services as stated in the following sections: ADMINISTRATIVE SERVICES - Annual administrative services as Transfer Agent and Registrar - Assignment of Account Administrator - Remote inquiry access to Fund records via PC or terminal with telecommunication software ACCOUNT MAINTENANCE - Maintaining up to 4,800 record shareholder accounts per year, additional shareholder accounts to be billed at $7.00 each per year, to include the following services: - Processing of new shareholder accounts - Posting and acknowledging address changes - Processing other routine file maintenance adjustments - Posting all transactions, including debit and credit certificates to the stockholder file - Researching and responding to all registered shareholder inquiries, telephone inquiries via toll-free number (line useage charges billed as incurred) - Confirmations of purchases and sales of shares of the Fund - Maintaining shareholder mailing database CERTIFICATE ISSUANCE - Issuance, cancellation and registration of certificates to include the following services: - Production and mailing of daily transfer reports Page 1 FEE AND SERVICE SCHEDULE FOR BEA INCOME FUND, INC. - ------------------------------------------------------------------------------- - Processing of all legal transfers including New York window and mail items - Combining certificates into large and/or smaller denominations - Processing Indemnity Bonds - Replacing lost certificates - Placing, maintaining and removing stop-transfer notations ANNUAL MEETING SERVICES - Preparing a full stockholder list as of the Annual Meeting Record Date - Printing and addressing proxy cards for all registered shareholders - Enclosing and mailing proxy card, proxy statement, return envelope and Annual Report to all registered shareholders - Receiving, opening and examining returned proxies - Writing in connection with unsigned or improperly executed proxies - Tabulating returned proxies; up to five (5) proposals, additional billed at $0.03 per proposal per shareholder - Provide on-line access to proxy vote status - Attending Annual Meeting as Inspector of Election (Travel expenses billed as incurred) - Preparing a final Annual Meeting List reflecting how each account has voted on each proposal - Interfacing with outside proxy solicitor MAILING AND REPORTING SERVICES - Addressing, enclosing and mailing to registered shareholders company-provided Semi-Annual Reports, 2 times per annum - Preparing eight (8) standard reports at the company's discretion per annum - Prepare and mail account statements to shareholders, twelve times per annum - Coding "multiple" accounts at a single household to suppress duplicate mailings of reports ABANDONED PROPERTY REPORTING SERVICES - Preparing Abandoned Property Reports, one (1) per annum to all 50 states - Preparing a set of labels, one (1) per annum to perform Due Diligence mailing. DIVIDEND SERVICES As Dividend Disbursing Agent and Paying Agent (checks to be drawn on BankBoston, N.A. and funding must be received via Federal Funds Wire or BankBoston Demand Deposit Account debit on the mail date), BankBoston will perform the following dividend related services: - Preparing and mailing monthly dividends (check includes address change feature) with an additional enclosure with each dividend check - Preparing a hardcopy dividend list as of each dividend record date - Preparing and filing Federal Information Returns (Form 1099) of dividends paid in a year and mailing a statement to each stockholder Page 2 FEE AND SERVICE SCHEDULE FOR BEA INCOME FUND, INC. - ------------------------------------------------------------------------------- - Preparing and filing State Information Returns of dividends paid in a year to stockholders resident within such state - Preparing and filing annual withholding return (Form 1042) and payments to the government of income taxes withheld from Non-Resident Aliens - Replacing lost dividend checks - Providing photocopies of canceled checks when requested - Reconciling paid and outstanding checks - Coding "undeliverable" accounts to suppress mailing dividend checks to same, per - SEC regulations - Processing and recordkeeping of accumulated uncashed dividends - Furnishing requested dividend information to stockholders - Performing the duties as required by the Interest and Dividend Tax Compliance Act of 1983 - Direct deposit of dividends via ACH DIVIDEND REINVESTMENT SERVICES - Monthly Reinvestment and/or cash investment transactions of Dividend Reinvestment Plan (DRP) participant accounts - Preparing and mailing a monthly dividend reinvestment detailed statement with an additional enclosure to each DRP participant - Preparing and mailing a monthly cash investment detailed statement with an additional enclosure to each DRP participant - Maintaining DRP accounts and establishing new participant accounts - Processing termination/sale requests - Processing withdrawal requests - Supplying summary reports for each reinvestment/investment to Company - Certificate safekeeping - Handling shareholder inquiries concerning the DRP - Preparing and mailing Form 1099, Form 1042, and Form 1099B to participants and related filings with the IRS - Preparing a Dividend Reinvestment Journal, 12 per annum. ITEMS NOT COVERED ADDITIONAL SERVICES Items not included in the fees and services set forth in this Fee and Service Schedule including, but not limited to, services associated with the payment of a stock dividend, stock split, corporate reorganization, or any services associated with a special project are to be billed separately, on an appraisal basis. Services required by legislation or regulatory fiat which become effective after the date of acceptance of this Fee and Service Schedule shall not be a part of the Standard Services and shall Page 3 FEE AND SERVICE SCHEDULE FOR BEA INCOME FUND, INC. - ------------------------------------------------------------------------------- be billed by appraisal. All additional services not specifically covered under this Fee and Service Schedule will be billed by appraisal, as applicable. OUT OF POCKET EXPENSES All direct out-of-pocket expenses will be billed as incurred. A list of applicable out-of-pocket expenses is attached as Exhibit A. ACCEPTANCE In witness whereof, the parties hereto have caused this Fee and Service Schedule to be executed by their respective officers, hereunto duly agreed and authorized, as of the effective date of this Fee and Service Schedule. Submitted by BankBoston, N.A. Accepted by BEA Income Fund, Inc. By: By: ----------------------- ----------------------- Title: Title: -------------------- -------------------- Date: Date: --------------------- --------------------- THIS FEE AND SERVICE SCHEDULE SHALL SERVE AS AN ATTACHMENT TO A TRANSFER AGENCY AND STOCK TRANSFER SERVICES AGREEMENT TO BE AGREED UPON BY THE PARTIES. Page 4 FEE AND SERVICE SCHEDULE FOR BEA INCOME FUND, INC. - ------------------------------------------------------------------------------- EXHIBIT A OUT OF POCKET EXPENSES Out of pocket expenses associated with, but not limited to, the following are NOT included in the fees quoted in this Fee and Service Schedule and are billable as incurred. POSTAGE (Outgoing and Business Reply) ENVELOPES LABELS FORMS AND STATIONERY INSURANCE PREMIUMS (Mailing certificates) DELIVERY AND FREIGHT CHARGES (including overnight delivery; Airborne Express, FedEx, etc.) TYPESETTING (proxy cards, dividend reinvestment enrollment cards, due diligence mailings, ACH enrollment cards, etc.) PRINTING (proxy cards, dividend reinvestment cards, etc.) DESTRUCTION OF EXCESS/OBSOLETE MATERIAL DTC TRADE TRANSACTIONS EXPENSES (Treasury buybacks, DR trades, etc.) CUSTODY SETTLEMENT CHARGES TOLL FREE TELEPHONE USAGE AND LINE EXPENSES PLEASE NOTE: Other out of pocket expenses could be incurred depending on the services utilized. Good funds to cover postage expenses in excess of $5,000 for shareholder mailings must be received in full by 12:00 p.m. Eastern Time on the scheduled mailing date. Postage expenses less than $5,000 will be billed as incurred. SKU numbers are required on all material received for mailing. A special handling fee of $10.00 per box will be assessed for all material not marked with a SKU number. Such material includes, but is not limited to: proxy statements, annual and quarterly reports, dividend enclosures and news releases. Overtime charges will be assessed in the event of late delivery of material for mailings to shareholders unless the mail date is rescheduled. Page 5 EX-99.13(B) 4 0004.txt ADMINISTRATIVE AND ACCOUNTING AGENCY AGREEMENT ADMINISTRATIVE AND ACCOUNTING AGENCY AGREEMENT THIS AGREEMENT is made as of February 27, 1999 by and between BROWN BROTHERS HARRIMAN & CO., a limited partnership organized under the laws of the State of New York (the "ADMINISTRATOR"), and each of the Funds listed on Appendix A to this Agreement (each a "FUND" and collectively, the "FUNDS"). WITNESSETH: WHEREAS, the Funds are registered with the United States Securities and Exchange Commission as management investment companies under the Investment Company Act of 1940, as amended (the "1940 Act"); and WHEREAS, the Funds desire to retain the Administrator to render certain services to the Funds, and the Administrator is willing to render such services. NOW, THEREFORE, in consideration of the premises and mutual covenants herein contained, the parties hereto agree as follows: APPOINTMENT OF ADMINISTRATOR. The Funds hereby employ and appoint the Administrator to act as their administrative and fund accounting agent on the terms set forth in this Agreement, and the Administrator accepts such appointment. DELIVERY OF DOCUMENTS. The Funds will: Furnish the Administrator with properly certified or authenticated copies of resolutions of the Funds' Board of Directors or Trustees authorizing the appointment of the Administrator as administrative and fund accounting agent of the Funds and approving this Agreement. Provide the Administrator with any other documents or resolutions (including but not limited to directions or resolutions of the Funds' Board of Directors or Trustees) which relate to or affect the Administrator's performance of its duties hereunder or which the Administrator may reasonably request. Notify the Administrator promptly of any matter affecting the performance by the Administrator of its services under this Agreement. DUTIES AS ADMINISTRATOR. Subject to the supervision and direction of the Board of Directors or Trustees of the Funds, the Administrator will perform the following services: Provide an Assistant Treasurer to the Fund. Accumulate information for and, subject to approval by the Funds' Treasurer, prepare reports to the Funds' shareholders of record as set forth in Rule 30d-1 of the 1940 Act or as agreed upon in writing from time to time between the parties hereto and file such reports with the Securities and Exchange Commission. Prepare and file the Securities and Exchange Commission's Form N-SAR. Consult with the Funds' Treasurer on financial matters relating to the Funds including without limitation dividend distributions, expense proformas, expense accruals and other matters, including payment of expenses, as shall from time to time be agreed upon by the parties. Assist the Funds' Treasurer with the Funds' federal, state and applicable local tax preparation and reporting, including the following: preparation of fiscal and excise tax distribution calculations; preparation and filing of federal, state and any local income tax returns, including tax return extension requests; preparation of shareholder year end reporting statements; provide the appropriate amounts and characterization of distributions declared during the calendar year for Forms 1099 reporting; periodically review and determine of distributions to be paid to shareholders; consult with the Fund's Treasurer regarding potential passive foreign investment companies ("PFICs"); consult with the Fund's Treasurer on various tax issues as they arise and with the Fund's outside auditors when appropriate; Assist the investment adviser for the Fund (the "Adviser"), at the Adviser's request, in monitoring and developing compliance procedures for the Fund which will include, among other matters, procedures to assist the Adviser in monitoring compliance with the Fund's investment objectives, policies and restrictions, tax matters and applicable laws and regulations and performing certain monthly compliance tests, to the extent relevant information is available to the Administrator in the performance of its functions as the Fund's net asset value calculation agent. Assist the Fund's Treasurer in the preparation of quarterly reporting to the Fund's Board of Directors or Trustees as required by applicable rules under the 1940 Act and as agreed between the Administrator and the Funds from time to time. Report monthly to the Funds' Treasurer on compliance of the Funds' fidelity bond coverage with Rule 17g-1 of the 1940 Act. Report monthly to Treasurer on comparison of the Funds' actual shares outstanding with its authorized shares. Assist the Funds' Treasurer in preparing the Funds' performance analysis reports (including yield and total return information) calculated in accordance with applicable U. S. securities laws and in reporting to external databases such information as may reasonably be requested. Serve as recordkeeper and net asset value calculation agent responsible for performing those functions as set forth in Section 4 below. Create, maintain and retain such records relating to its obligations under this Agreement as are required under the 1940 Act (including Section 31 thereof and Rules 31a-1 and 31a-2 thereunder). Assist the Funds' Treasurer, officers and Adviser in such other matters as the Funds and the Administrator shall from time to time agree. In performing its duties and obligations hereunder, the Administrator will act in accordance with the Funds' Articles of Incorporation or Declaration of Trust, By-laws and Prospectus and Proper Instructions. It is agreed and understood, however, that the Administrator shall not be responsible for compliance the Funds' investments with any applicable documents, laws or regulations, or for losses, costs or expenses arising out of the Funds' failure to comply with said documents, laws or regulations or the Funds' failure or inability to correct any non-compliance therewith. DUTIES AS NET ASSET VALUE CALCULATION AGENT. The Administrator shall compute and determine the net asset value per share of the Funds as of the close of business on the New York Stock Exchange on each day on which such Exchange is open, unless otherwise directed by Proper Instruction. Such computation and determination shall be made in accordance with: The provisions of the Funds' Declaration of Trust or Certificate of Incorporation and By-Laws, as they may from time to time be amended and delivered to the Administrator. The votes of the Board of Directors or Trustees of the Fund at the time in force and applicable, as they may from time to time be delivered to the Administrator. Proper Instructions, including without limitation any information: as to accrual of liabilities of the Funds and as to liabilities of the Funds not appearing on the books of account kept by the Administrator as to the existence, status and proper treatment of reserves, if any, authorized by the Funds as to the sources of quotations to be used in computing the net asset value, including those listed in Appendix B hereto as to the fair value to be assigned to any securities or other property for which price quotations are not readily available as to the sources of information with respect to "corporate actions" affecting portfolio securities of the Funds, including those listed in Appendix B. (Information as to "corporate actions" shall include information as to dividends, distributions, stock splits, stock dividends, rights offerings, conversions, exchanges, recapitalizations, mergers, redemptions, calls, maturity dates and similar transactions, including the ex- and record dates and the amounts or other terms thereof.). as to the use a particular source for the valuation of a specific Security or other Property of the Funds. Notwithstanding anything in this Agreement to the contrary, the Administrator shall not be responsible for the failure of the Funds or their Investment Advisers to provide the Administrator with Proper Instructions regarding liabilities which ought to be included in the calculation of the Funds' net asset value. On each day that the Administrator shall compute the net asset value per share of the Funds, the Administrator shall provide the Investment Advisers of the Funds with written reports which the Investment Advisers will use to verify that portfolio transactions have been recorded in accordance with the Funds' instructions and are reconciled with the Funds' trading records. In like manner, the Administrator shall compute and determine the net asset value as of such other times as the Board of Directors or Trustees of the Funds from time to time may reasonably request. Notwithstanding any other provisions of this Agreement, the following provisions shall apply with respect to the Administrator's responsibilities as net asset valuation calculation agent. The Administrator shall be held to the exercise of reasonable care in computing and determining net asset value, but shall not be held accountable or liable for any losses or damages the Funds or any shareholder or former shareholder of the Funds or any other person may suffer or incur arising from or based upon errors or delays in the determination of such net asset value resulting from any event beyond the reasonable control of the Administrator unless such error or delay was due to the Administrator's negligence willful misconduct in determination of such net asset value (The parties hereto acknowledge, however, that the Administrator's causing an error or delay in the determination of net asset value may, but does not in and of itself, constitute negligence or reckless or willful misconduct.). In no event shall the Administrator be liable or responsible to the Funds, any present or former shareholder of the Funds or any other person for any error or delay which continued or was undetected after the date of an audit performed by the certified public accountants employed by the Funds if, in the exercise of reasonable care in accordance with generally accepted accounting standards, such accountants should have become aware of such error or delay in the course of performing such audit. The Administrator's liability for any such negligence or reckless or willful misconduct which results in an error in determination of such net asset value shall be limited exclusively to the direct, out-of-pocket loss the Fund, shall actually incur, measured by the difference between the actual and the erroneously computed net asset value, and any expenses the Fund shall incur in connection with correcting the records of the Fund affected by such error (including charges made by the Fund's registrar and transfer agent for making such corrections) or communicating with shareholders or former shareholders of the Fund affected by such error. Without limiting the foregoing, the Administrator shall not be held accountable or liable to the Funds, any shareholder or former shareholder thereof or any other person for any delays or losses, damages or expenses any of them may suffer or incur resulting from (i) the Administrator's failure to receive timely and suitable notification concerning quotations or corporate actions relating to or affecting portfolio securities of the Funds or (ii) any errors in the computation of the net asset value based upon or arising out of quotations or information as to corporate actions if received by the Administrator either (a) from a source which t Administrator was authorized to rely upon (including those sources listed on Appendix B), (b) from a source which in the Administrator's reasonable judgment was as reliable a source for such quotations or information as such authorized sources, or (c) relevant information known to the Fund or the Investment Adviser which would impact the calculation of net asset value but which is not communicated by the Fund or the Investment Adviser to the Administrator. In the event of any error or delay in the determination of such net asset value for which the Administrator may be liable, the Funds and the Administrator will consult and make good faith efforts to reach agreement on what actions should be taken in order to mitigate any loss suffered by the Fund or its present or former shareholders, in order that the Administrator's exposure to liability shall be reduced to the extent possible after taking into account all relevant factors and alternatives. It is understood that in attempting to reach agreement on the actions to be taken or the amount of the loss which should appropriately be borne by the Administrator, the Fund and the Administrator will consider such relevant factors as the amount of the loss involved, the Fund's desire to avoid loss of shareholder good will, the fact that other persons or entities could have been reasonably expected to have detected the error sooner than the time it was actually discovered, the appropriateness of limiting or eliminating the benefit which shareholders or former shareholders might have obtained by reason of the error, and the possibility that other parties providing services to the Fund might be induced to absorb a portion of the loss incurred. The Administrator shall in no event be liable or responsible to the Fund, any present or former shareholder of the Fund or any other person for any error or delay which continued or was undetected after the date of an audit performed by the certified public accountants employed by the Fund if, in the exercise of reasonable care in accordance with generally accepted accounting standards, such accountants should have become aware of such error or delay in the course of performing such audit. Notwithstanding anything else in this Agreement to the contrary, the Administrator's entire liability to the Fund for any loss or damage arising or resulting from its performance hereunder or for any other cause whatsoever, and regardless of the form of action, shall be limited to the Fund's actual and direct out-of-pocket expenses and losses which are reasonably incurred by the Fund. In no event and under no circumstances shall the Administrator or a Fund be held liable to the other party for consequential or indirect damages, loss of profits, damage to reputation or business or any other special damages arising under or by reason of any provision of this Agreement or for any act or omission hereunder. EXPENSES AND COMPENSATION. For the services to be rendered and the facilities to be furnished by the Administrator as provided for in this Agreement, the Funds shall pay the Administrator for its services rendered pursuant to this Agreement a fee based on such fee schedule as may from time to time be agreed upon in writing by the Funds and the Administrator. In addition to such fee, the Administrator shall bill the Funds separately for any out-of-pocket disbursements of the Administrator. Out-of-pocket disbursements shall include, but shall not be limited to, postage, including courier services; telephone; telecommunications; printing, duplicating and photocopying charges; forms and supplies; filing fees; legal expenses; and travel expenses. The foregoing fees and disbursements shall be billed to the Fund by the Administrator and shall be paid promptly by wire transfer or other appropriate means to the Administrator. STANDARD OF CARE. The Administrator shall be held only to the exercise of reasonable care and diligence in carrying out the provisions of this Agreement, provided that the Administrator shall not thereby be required to take any action which is in contravention of any applicable law, rule or regulation or any order or judgment of any court of competent jurisdiction. LIMITATION OF LIABILITY. The Administrator shall incur no liability with respect to any telecommunications, equipment or power failures, or any failures to perform or delays in performance by postal or courier services or third-party information providers (including without limitation those listed on Appendix B). The Administrator shall also incur no liability under this Agreement if the Administrator or any agent or entity utilized by the Administrator shall be prevented, forbidden or delayed from performing, or omits to perform, any act or thing which this Agreement provides shall be performed or omitted to be performed, by reason of causes or events beyond its control, including but not limited to: any Sovereign Event. A "Sovereign Event" shall mean any nationalization; expropriation; devaluation; revaluation; confiscation; seizure; cancellation; destruction; strike; act of war, terrorism, insurrection or revolution; or any other act or event beyond the Administrator's control. any provision of any present or future law, regulation or order of the United States or any state thereof, or of any foreign country or political subdivision thereof, or of any securities depository or clearing agency, any provision of any order or judgment of any court of competent jurisdiction. Notwithstanding any other provision of this Agreement, the Administrator shall not be held accountable or liable for any losses, damages or expenses the Funds or any shareholder or former shareholder of the Funds or any other person may suffer or incur arising from acts, omissions, errors or delays of the Administrator in the performance of its obligations and duties hereunder, including without limitation any error of judgment or mistake of law, except a damage, loss or expense resulting from the Administrator's willful malfeasance, bad faith or negligence in the performance of such obligations and duties. The Administrator shall in no event be required to take any action, which is in contravention of any applicable law, rule or regulation or any order or judgment of any court of competent jurisdiction. The Fund hereby agrees to indemnify the Administrator against and hold it harmless from any and all losses, claims, damages, liabilities or expenses (including reasonable counsel fees and expenses) resulting from any act, omission, error or delay or any claim, demand, action or suit, in connection with or arising out of performance of its obligations and duties under this Agreement, not resulting from the willful malfeasance, bad faith or negligence of the Administrator in the performance of such obligations and duties. RELIANCE BY THE ADMINISTRATOR ON PROPER INSTRUCTIONS AND OPINIONS OF COUNSEL AND OPINIONS OF CERTIFIED PUBLIC ACCOUNTANTS. The Administrator shall not be liable for, and shall be indemnified by the Funds against any and all losses, costs, damages or expenses arising from or as a result of, any action taken or omitted in reliance upon Proper Instructions or upon any other written notice, request, direction, instruction, certificate or other instrument believed by it to be genuine and signed or authorized by the proper party or parties. Proper Instructions shall include a written request, direction, instruction or certification signed or initialed on behalf of the Fund by one or more persons as the Board of Directors or Trustees of the Fund shall have from time to time authorized. Those persons authorized to give Proper Instructions may be identified by the Board of Directors or Trustees by name, title or position and will include at least one officer empowered by the Board to name other individuals who are authorized to give Proper Instructions on behalf of the Fund. Telephonic or other oral instructions or instructions given by telefax transmission may be given by any one of the above persons and will also be considered Proper Instructions if the Administrator believes them to have been given by a person authorized to give such instructions with respect to the transaction involved. With respect to telefax transmissions, the Fund hereby acknowledges that(i) receipt of legible instructions cannot be assured, (ii) the Administrator cannot verify that authorized signatures on telefax instructions are original, and (iii) the Administrator shall not be responsible for losses or expenses incurred through actions taken in reliance on such telefax instructions. The Fund agrees that such telefax instructions shall be conclusive evidence of the Fund's Proper Instruction to the Administrator to act or to omit to act. Proper Instructions given orally will be confirmed by written instructions in the manner set forth above, including by telefax, but the lack of such confirmation shall in no way affect any action taken by the Administrator in reliance upon such oral instructions. The Fund authorizes the Administrator to tape record any and all telephonic or other oral instructions given to the Administrator by or on behalf of the Fund (including any of its officers, Directors, Trustees, employees or agents or any investment manager or adviser or person or entity with similar responsibilities which is authorized to give Proper Instructions on behalf of the Fund to the Administrator.) The Administrator may consult with its counsel or the Fund's counsel in any case where so doing appears to the Administrator to be necessary or desirable. The Administrator shall not be considered to have engaged in any misconduct or to have acted negligently and shall be without liability in acting upon the advice of its counsel or of the Fund's counsel. The Administrator may consult with a certified public accountant or the Fund's Treasurer in any case where so doing appears to the Administrator to be necessary or desirable. The Administrator shall not be considered to have engaged in any misconduct or to have acted negligently and shall be without liability in acting upon the advice of such certified public accountant or of the Fund's Treasurer. TERMINATION OF AGREEMENT. This Agreement shall continue in full force and effect until terminated by the Administrator or the Fund by an instrument in writing delivered or mailed, postage prepaid, to the other party, such termination to take effect not sooner than ninety (90) days after the date of such delivery or mailing. In the event a termination notice is given by a party hereto, all expenses associated with the movement of records and materials and the conversion thereof shall be paid by the Fund for which services shall cease to be performed hereunder. Notwithstanding anything in the foregoing provisions of this clause, if it appears impracticable in the circumstances to effect an orderly delivery of the necessary and appropriate records of the Administrator to a successor within the time specified in the notice of termination as aforesaid, the Administrator and the Fund agree that this Agreement shall remain in full force and effect for such reasonable period as may be required to complete necessary arrangements with a successor. If a party hereto shall fail to perform its duties and obligations hereunder (a "Defaulting Party") resulting in material loss to another party("the "Non-Defaulting Party"), the Non-Defaulting Party may give written notice thereof to the Defaulting Party, and if such material breach shall not have been remedied within thirty (30) days after such written notice is given, then the Non-Defaulting Party may terminate this Agreement by giving thirty (30) days' written notice of such termination to the Defaulting Party. If the Administrator is the Non-Defaulting Party, its termination of this Agreement shall not constitute a waiver of any other rights or remedies of the Administrator with respect to payment for services performed prior to such termination or rights of the Administrator to be reimbursed for out-of-pocket expenses. In all cases, termination by the Non-Defaulting Party shall not constitute a waiver by the Non-Defaulting Party of any other rights it might have under this Agreement or otherwise against the Defaulting Party. This Section 9 shall survive any termination of this Agreement, whether for cause or not for cause. AMENDMENT OF THIS AGREEMENT. This Agreement constitutes the entire understanding and agreement of the parties hereto with respect to the subject matter hereof. No provision of this Agreement may be amended or terminated except by a statement in writing signed by the party against which enforcement of the amendment or termination is sought. In connection with the operation of this Agreement, the Fund and the Administrator may agree in writing from time to time on such provisions interpretive of or in addition to the provisions of this Agreement as may in their joint opinion be consistent with the general tenor of this Agreement. No interpretive or additional provisions made as provided in the preceding sentence shall be deemed to be an amendment of this Agreement. In the event any provision of this Agreement is determined to be void or unenforceable, such determination shall not affect the remainder of this Agreement, which shall continue to be in force. The section headings and the use of defined terms in the singular or plural tenses in this Agreement are for the convenience of the parties and in no way alter, amend, limit or restrict the contractual obligations of the parties set forth in this Agreement. GOVERNING LAW. This Agreement shall be governed by and construed according to the laws of the Commonwealth of Massachusetts without giving effect to conflicts of laws principles. NOTICES. Notices and other writings delivered or mailed postage prepaid to the Fund addressed to the Fund at 153 East 53rd Street, New York, New York 10022 or to such other address as the Fund may have designated to the Administrator in writing, or to the Administrator at 40 Water Street, Boston, MA 02109, Attention: Manager, Fund Administration Department, or to such other address as the Administrator may have designated to the Fund in writing, shall be deemed to have been properly delivered or given hereunder to the respective addressee. BINDING EFFECT. This Agreement shall be binding upon and inure to the benefit of the Fund and the Administrator and their respective successors and assigns, provided that no party hereto may assign this Agreement or any of its rights or obligations hereunder without the written consent of the other party. COUNTERPARTS. This Agreement may be executed in any number of counterparts each of which shall be deemed to be an original and which collectively shall be deemed to constitute only one instrument. This Agreement shall become effective when one or more counterparts have been signed and delivered by each of the parties. EXCLUSIVITY. The services furnished by the Administrator hereunder are not to be deemed exclusive, and the Administrator shall be free to furnish similar services to others. AUTHORIZATION. The Fund hereby represents and warrants that the execution and delivery of this Agreement have been authorized by the Fund's Board of Directors or Trustees and that this Agreement has been signed by an authorized officer of the Fund. IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed and delivered by their duly authorized officers as of the date first written above. BROWN BROTHERS HARRIMAN & CO. each of the Management Investment Companies listed on the attached Appendix A By: /s/ Illegible By: /s/ Hal Liebes ------------------- ----------------------------- Name: Name: Hal Liebes Title: Title: Senior Vice President APPENDIX A TO ADMINISTRATIVE AND ACCOUNTING AGENCY AGREEMENT Dated as of February 27, 1999 The following is a list of Investment Companies for which the Administrator shall serve under a Administrative and Accounting Agency Agreement dated as of February 27, 1999 (the "Agreement"): BEA INCOME FUND, INC. BEA STRATEGIC GLOBAL INCOME FUND, INC. IN WITNESS WHEREOF, each of the parties hereto has caused this Schedule to be executed in its name and on behalf of each such Investment Company. each of the Investment Companies BROWN BROTHERS HARRIMAN & CO. listed above By: /s/ Hal Liebes By: /s/ Illegible --------------------------- ------------------------------ Name: Hal Liebes Name: Title: Senior Vice President Title: EX-99.13(D) 5 0005.txt CREDIT AGREEMENT CREDIT AGREEMENT, DATED AS OF JUNE 23, 1999 BY AND AMONG THE FUNDS NAMED THEREIN, THE BANKS NAMED THEREIN, DEUTSCHE BANK AG, NEW YORK BRANCH, AS ADMINISTRATIVE AGENT, BANK OF NOVA SCOTIA, AS SYNDICATION AGENT, AND STATE STREET BANK AND TRUST COMPANY, AS OPERATIONS AGENT TABLE OF CONTENTS PAGE ARTICLE I. DEFINITIONS; CONSTRUCTION........................................1 Section 1.01. Definitions.................................................1 Section 1.02. Accounting Terms and Determinations.........................8 Section 1.03. Other Definitional Terms....................................8 ARTICLE II. COMMITTED LINE OF CREDIT.........................................8 Section 2.01. Commitment to Lend..........................................8 Section 2.02. Reduction or Termination of Commitment......................9 Section 2.03. Committed Credit Loan Accounts.............................10 Section 2.04. Requests for Committed Credit Loans........................10 Section 2.05. Repayment of Committed Credit Loans........................12 ARTICLE III. SWING LINE OF CREDIT............................................12 Section 3.01. The Swing Line of Credit...................................12 Section 3.02. Swing Line Loan Account....................................13 Section 3.03. Requests for Swing Line Loans..............................13 Section 3.04. Repayment of Swing Line Loans..............................14 Section 3.05. Refunding of Swing Line Loans..............................14 ARTICLE IV. CERTAIN COMMON PROVISIONS.......................................15 Section 4.01. Optional Prepayments; Certain Mandatory Prepayments........15 Section 4.02. Place and Mode of Payments; Computations...................16 Section 4.03. Interest...................................................18 Section 4.04. Overdue Principal and Interest.............................19 Section 4.05. Limitation on Interest.....................................19 Section 4.06. Withholding Tax Exemption..................................19 Section 4.07. Increased Capital Requirements.............................20 Section 4.08. Use of Proceeds............................................20 Section 4.09. Borrower Agents............................................21 Section 4.10. Take-out of Individual Banks...............................21 Section 4.11. Sharing of Payments; Etc...................................21 ARTICLE V. FEES............................................................22 Section 5.01. Commitment Fees............................................22 Section 5.02. Operations Agent's Fee.....................................23 Section 5.03. Administrative Agent's Fee.................................23 Section 5.04. Allocation Fee.............................................23 ARTICLE VI. CONDITIONS PRECEDENT............................................23 Section 6.01. Conditions to Closing......................................23 Section 6.02. Conditions Precedent to All Loans..........................25 ARTICLE VII. REPRESENTATIONS AND WARRANTIES..................................26 Section 7.01. Organization, Standing, Etc. of the Borrower...............26 Section 7.02. Financial Information; Disclosure; Etc.....................26 Section 7.03. Litigation; Etc............................................26 Section 7.04. Authorization; Compliance with Other Instruments...........27 Section 7.05. SEC Compliance; Etc........................................27 Section 7.06. Binding Effect.............................................27 Section 7.07. Governmental Consent.......................................27 Section 7.08. Regulation U; Etc..........................................27 Section 7.09. Relationship with Investment Adviser.......................28 Section 7.10. Relationship with Custodian................................28 Section 7.11. Investment Company Status..................................28 Section 7.12. Affiliated Persons.........................................28 Section 7.13. ERISA......................................................28 Section 7.14. Taxes......................................................28 Section 7.15. Good Title to Properties...................................28 Section 7.16. Subsidiaries...............................................28 Section 7.17. No Default.................................................28 Section 7.18. Year 2000 Compliance.......................................28 Section 7.19. Full Disclosure............................................29 ARTICLE VIII. AFFIRMATIVE COVENANTS...........................................29 Section 8.01. Financial Statements; Etc..................................29 Section 8.02. Legal Existence; Compliance with Laws; Etc.................30 Section 8.03. Further Assurances.........................................31 Section 8.04. Investment Company Status..................................31 Section 8.05. Use of Proceeds............................................31 Section 8.06. Insurance..................................................31 ARTICLE IX. NEGATIVE COVENANTS..............................................32 Section 9.01. Asset Coverage.............................................32 Section 9.02. Indebtedness...............................................32 Section 9.03. Mortgages; Liens; Etc......................................33 Section 9.04. Change of Investment Objectives, Etc.......................33 ARTICLE X. DEFAULTS; REMEDIES..............................................33 Section 10.01. Events of Default; Acceleration...........................33 Section 10.02. Remedies on Default; Etc..................................36 ARTICLE XI. SETOFFS; ETC....................................................36 ii ARTICLE XII. THE OPERATIONS AGENT AND RELATIONS AMONG THE BANKS..............37 Section 12.01. Appointment of Operations Agent; Powers and Immunities....37 Section 12.02. Reliance by Operations Agent..............................37 Section 12.03. Indemnification...........................................37 Section 12.04. Documents.................................................38 Section 12.05. Non-Reliance on Operations Agent and Other Banks..........38 Section 12.06. Resignation or Removal of Operations Agent................38 Section 12.07. Delinquent Banks..........................................38 ARTICLE XIII. ADDITIONAL BORROWERS............................................39 ARTICLE XIV. TERM AND TERMINATION............................................39 Section 14.01. Term and Termination of Agreement.........................39 Section 14.02. Termination as to a Borrower..............................40 ARTICLE XV. PROVISIONS OF GENERAL APPLICATION...............................42 Section 15.01. Expenses..................................................42 Section 15.02. Amendments and Waivers; Etc...............................43 Section 15.03. Nature of Obligations.....................................44 Section 15.04. Notices...................................................44 Section 15.05. Calculations; Etc.........................................45 Section 15.06. Survival of Covenants; Etc................................45 Section 15.07. Parties in Interest; Assignments; Participations..........45 Section 15.08. Counterparts; Etc.........................................46 Section 15.09. Entire Agreement; Etc.....................................46 Section 15.10. Severability..............................................47 Section 15.11. Governing Law; Jurisdiction; Waiver.......................47 Section 15.12. Indemnification...........................................47 Section 15.13. Miscellaneous.............................................48 Section 15.14. Confidentiality...........................................48 ARTICLE XVI. LIMITATION OF LIABILITY.........................................48 iii SCHEDULES AND EXHIBITS Schedule 1 List of Eligible Borrowers Schedule 2 Banks; Addresses; Facility Percentages Schedule 7.03 Litigation; Etc. Exhibit A Borrowing Request (Committed Credit Loans) Exhibit B Borrowing Request (Swing Line Loans) Exhibit C Repayment Notice (Committed Credit Loans) Exhibit D Repayment Notice (Swing Line Loans) Exhibit E Daily Valuation Report Exhibit F Form for Additional Borrower Exhibit G Form of Opinion of Counsel Exhibit H Form of Assignment and Acceptance iv CREDIT AGREEMENT CREDIT AGREEMENT dated as of June 23, 1999, by and among each investment management company listed on SCHEDULE 1 attached hereto, on behalf of itself and its respective investment portfolios identified thereon, severally and not jointly, as said SCHEDULE 1 may be revised from time to time; the Banks listed on SCHEDULE 2 attached hereto, as revised from time to time (collectively, and together with State Street Bank and Trust Company, in its capacity as Swing Line Lender, the "BANKS" and each individually a "BANK"); Deutsche Bank AG, New York Branch, not individually but in its capacity as administrative agent for the Banks hereunder (in such capacity, the "ADMINISTRATIVE AGENT"); Bank of Nova Scotia, not individually but in its capacity as syndication agent for the Banks hereunder (in such capacity, the "SYNDICATION AGENT"); and State Street Bank and Trust Company, not individually but in its separate capacity as operations agent for the Banks hereunder (in such capacity, the "OPERATIONS AGENT"). The parties hereto hereby agree as follows: ARTICLE I. DEFINITIONS; CONSTRUCTION Section 1.01. DEFINITIONS. As used herein, the following terms shall have the meanings herein specified (to be equally applicable to both the singular and plural forms of the terms defined): "ACM" shall mean Abbott Capital Management, LLC, a Delaware limited liability company. "ADMINISTRATIVE AGENT" shall have the meaning specified in the preamble hereof. "AFFILIATE" shall mean, as applied to any Person, a spouse or relative of such Person, any member, director or officer of such Person, any corporation, association, firm or other entity of which such Person is a member, director or officer, and any other Person directly or indirectly controlling, controlled by or under direct or indirect common control with such Person. "AGENTS" shall mean, collectively, the Administrative Agent, the Syndication Agent and the Operations Agent. "AGREEMENT" shall mean this Credit Agreement, including the Schedules and Exhibits annexed hereto, as amended, supplemented or modified from time to time in accordance with its terms. "ALLOCATION FEE" shall have the meaning specified in Section 5.04 hereof. "ARRANGING FEE" shall have the meaning specified in Section 5.03 hereof. "AUTHORIZED OFFICER" shall mean the Chairman of the Board, President, any Vice President, Treasurer, Assistant Treasurer, Secretary or Assistant Secretary of a Borrower, or any other Person designated from time to time by any of the foregoing. "BANK" or "BANKS" shall have the respective meanings specified in the preamble hereof. "BANKING DAY" shall mean any day excluding Saturday and Sunday and excluding any other day which shall be in Boston, Massachusetts, or New York, New York, a legal holiday or a day on which banking institutions are authorized by law to close. "BOARD" shall mean the Board of Governors of the Federal Reserve System of the United States. "BORROWER" shall mean any Fund Borrower or Portfolio Borrower; and "BORROWERS" shall mean, collectively, all Fund Borrowers and Portfolio Borrowers. "BORROWER AGENT" or "BORROWER AGENTS" shall have the respective meanings specified in Section 4.09 hereof. "BORROWING BASE" shall have the meaning specified in Section 9.01 hereof. "BORROWING REQUEST" shall mean any Request for Committed Credit Loan or Request for Swing Line Loan; and "BORROWING REQUESTS" shall mean, collectively, all Requests for Committed Credit Loans and Requests for Swing Line Loans. "BBH&CO" shall mean Brown Brothers Harriman & Company, a New York general partnership. "COMMITMENT" shall mean, with respect to each Bank, such Bank's obligation to make Committed Credit Loans in an aggregate amount not exceeding such Bank's Facility Percentage of the Maximum Committed Credit Amount; and "COMMITMENTS" means the aggregate Commitments of all the Banks. "COMMITMENT FEE" shall have the meaning specified in Section 5.01 hereof. "COMMITTED CREDIT LOAN" shall mean any loan made or to be made to the Borrowers as contemplated by Article II hereof. "COMMITTED CREDIT LOAN ACCOUNT" shall have the meaning specified in Section 2.03 hereof. "CONTROLLED GROUP" shall mean all members of a controlled group of corporations and all trades or businesses (whether or not incorporated) under common control which, together with Borrower, are treated as a single employer under Section 414 of the Internal Revenue Code. "CREDIT SUISSE ASSET MANAGEMENT" shall mean Credit Suisse Asset Management, a New York general partnership, or its proposed successor, Credit Suisse Asset Management LLC, a Delaware limited liability company. "CUSTODIAN" shall mean the entity which acts as the custodian of the securities of the Borrowers, or any one or more of the Borrowers, for purposes of Section 17(f) of the Investment Company Act. "CTC" shall mean Custodial Trust Company, a New Jersey corporation. -2- "DAILY VALUATION REPORT" shall have the meaning specified in Section 8.01(d) hereof. "DEFAULT" shall mean an Event of Default or any condition or event which, with notice or lapse of time, or both, would constitute an Event of Default. "DELINQUENT BANK" shall have the meaning specified in Section 12.07 hereof. "DOMESTIC FUND" shall mean any Borrower designated as such on SCHEDULE 1 annexed hereto, which designation shall be concurred in by the Agents. "ERISA" shall mean the Employment Retirement Income Security Act of 1974, as amended, and the rules and regulations promulgated thereunder. "EVENT OF DEFAULT" shall have the meaning specified in Section 10.01 hereof. "EXPIRATION DATE" shall have the meaning specified in Section 14.01 hereof. "FACILITY PERCENTAGE" shall mean, with respect to each Bank, the percentage figure set forth underneath such Bank's name in SCHEDULE 2 annexed hereto. "FDIC" shall mean the Federal Deposit Insurance Corporation. "FEDERAL FUNDS EFFECTIVE RATE" shall mean, at the relevant time of reference thereto, the rate that appears on the telerate page 5 as quoted by Garvin Guy Butler, as of 12:00 noon (New York time), as the "Federal Funds Offered Rate", or, if unavailable, by any other federal funds broker of recognized standing as determined by the Operations Agent. "FEDERAL FUNDS RATE" shall mean, at the relevant time of reference thereto, one-half of one percentage point (0.500%) over the Federal Funds Effective Rate. "FINANCIAL CONTRACTS" shall mean option contracts, futures contracts, options on futures contracts, forward foreign currency exchange contracts, options on foreign currencies, repurchase agreements, reverse repurchase agreements, securities lending agreements, interest rate swaps, currency swaps and all other types of swap agreements and related transactions (including, without limitation, caps, floors and collars), when-issued securities, short sales and other similar arrangements. "FUND" shall mean any investment management company listed on SCHEDULE 1 attached hereto, as revised from time to time, which term shall include any other investment management company that may become a party to this Agreement as provided in Article XIII hereof; and "FUNDS" shall mean, collectively, all of the Funds. "FUND BORROWER" shall mean each Fund that borrows money hereunder for its own account and not for the account of one of its Portfolios; and "FUND BORROWERS" shall mean, collectively, all of the Fund Borrowers. "GAAP" shall mean generally accepted accounting principles as set forth in the opinions and pronouncements of the Accounting Principles Board of the American Institute of Certified -3- Public Accountants and statements and pronouncements of the Financial Accounting Standards Board. "INDEBTEDNESS" shall mean, as applied to any Person, all obligations, contingent and otherwise, which, in accordance with generally accepted accounting principles, should be classified upon the Person's balance sheet as liabilities, or to which reference should be made by footnotes thereto, including, without limitation, in any event and whether or not so classified: (i) all debt and similar monetary obligations, whether direct or indirect; (ii) all liabilities secured by any mortgage, pledge, security interest, lien, charge or other encumbrance existing on property owned or acquired subject thereto, or with respect to which assets of the Person have been segregated, whether or not the liability secured thereby shall have been assumed, including, without limitation, any cash or securities held or otherwise pledged as collateral in connection with any short sales transactions; and (iii) all guaranties, endorsements and other contingent obligations, whether direct or indirect, in respect of Indebtedness of others, including any obligation to supply funds to or in any manner to invest in, directly or indirectly, the debtor (whether by way of loan, stock purchase, capital contribution or otherwise), to purchase Indebtedness, or to assure the owner of Indebtedness against loss, through an agreement to purchase goods, supplies or services for the purpose of enabling the debtor to make payment of the Indebtedness held by such owner or otherwise, and the obligations to reimburse the issuer of any letters of credit. "INTERNAL REVENUE CODE" shall mean the Internal Revenue Code of 1986, as amended and in effect from time to time, or any successor statute. "INTERNATIONAL FUND" shall mean any Borrower designated as such on SCHEDULE 1 annexed hereto (which designation shall be concurred in by the Agents), and including any Borrower determined to be an international fund, a region-specific (other than within the United States of America) fund or a single-country (other than the United States of America) fund. "INVESTMENT ADVISER" shall mean any Person serving as an investment adviser, as defined in the Investment Company Act, to an Investment Company or Portfolio. "INVESTMENT COMPANY" shall mean any Person registered as an investment management company under the Investment Company Act. "INVESTMENT COMPANY ACT" shall mean the Investment Company Act of 1940, as amended, including all rules and regulations promulgated thereunder. "LIENS" shall have the meaning specified in Section 9.03 hereof. "LOAN" shall mean any Committed Credit Loan or Swing Line Loan; and "LOANS" shall mean, collectively, all Committed Credit Loans and Swing Line Loans. "LOAN DOCUMENTS" shall mean, collectively, this Agreement and all other agreements, instruments, documents and certificates now and hereafter executed and/or delivered pursuant hereto or thereto. -4- "MAJORITY BANKS" shall mean, at any particular time, those Banks the sum of whose then outstanding Committed Credit Loans to the Borrowers aggregate to at least 51% of the aggregate of all such outstanding Committed Credit Loans or, if no Committed Credit Loans are then outstanding, the sum of whose Facility Percentages aggregate to at least 51% of the Maximum Committed Credit Amount. "MATERIAL ADVERSE EFFECT" shall mean, with respect to any Borrower, a material adverse effect on the business, assets, operations, prospects or condition (financial or otherwise) of such Borrower or on the ability of such Borrower to perform its obligations under this Agreement. "MAXIMUM COMMITTED CREDIT AMOUNT" shall mean the maximum amount of the Banks' commitments to make Committed Credit Loans to the Borrowers hereunder, which in the first instance shall be $250,000,000, as the same may be reduced from time to time pursuant to Section 2.02 hereof. "MAXIMUM CREDIT AMOUNT" shall mean the maximum amount of credit available to the Borrowers hereunder, which in the first instance shall be $250,000,000. "MULTIEMPLOYER PLAN" shall mean, at any time, an employee pension benefit plan within the meaning of Section 4001(a)(3) of ERISA to which a Borrower or any member of the Controlled Group is then making or accruing an obligation to make contributions or has within the preceding five plan years made contributions, including for these purposes any Person which ceased to be a member of the Controlled Group during such five year period. "NET ASSETS" shall mean, as applied to any Borrower, the value of the Total Assets of such Borrower, less all liabilities and Indebtedness other than Loans outstanding hereunder. For purposes of this definition the value of a Borrower's portfolio securities shall be the value of such securities as determined from time to time in a manner consistent with that used by such Borrower for reporting purposes in accordance with regulatory requirements. "OFFICERS' CERTIFICATE" shall have the meaning specified in Section 6.01(e) hereof. "OPERATIONS AGENT" shall have the meaning specified in the preamble hereof. "OPERATIONS AGENT'S FEE" shall have the meaning specified in Section 5.02 hereof. "PBGC" shall mean the Pension Benefit Guaranty Corporation or any entity succeeding to any or all of its functions under ERISA. "PERSON" shall mean a corporation, an association, a trust (or series of a trust), a partnership, a limited liability company, a limited liability partnership, a joint venture, an organization, a business, an individual, a government or political subdivision thereof or a governmental agency. "PFPC TRUST" shall mean PFPC Trust Company, a limited purpose trust company organized under the laws of the State of Delaware. -5- "PLAN" shall mean any employee pension benefit plan which is covered by Title IV of ERISA or subject to minimum funding standards under Section 412 of the Internal Revenue Code and is either (a) maintained by a Borrower or any member of the Controlled Group for employees of a Borrower or any member of the Controlled Group or (b) maintained pursuant to a collective bargaining agreement or any other arrangement under which more than one employer makes contributions and to which a Borrower or any member of the Controlled Group is then making or accruing an obligation to make contributions or has within the preceding five plan years made contributions. "PORTFOLIO" shall mean an investment portfolio of an Investment Company. "PORTFOLIO BORROWER" shall mean any Portfolio of a Fund on whose behalf Loans are requested hereunder, which term shall include any other Portfolio that is added as a Borrower hereunder as provided in Article XIII hereof; and "PORTFOLIO BORROWERS" shall mean, collectively, all Portfolio Borrowers. "PROSPECTUS" shall mean, as applicable, (i) the currently effective prospectus and statement of additional information delivered to purchasers of Shares of a Borrower, which is an open-end Investment Company (or a Portfolio thereof), pursuant to the Securities Act of 1933, as amended, or (ii) the Registration Statement of a Borrower that is a closed-end Investment Company. "REFUNDED SWING LINE LOAN" shall have the meaning specified in Section 3.05(a) hereof. "REGISTRATION STATEMENT" shall mean the Registration Statement on Form N-2, or any successor form, of a Borrower that is a closed-end Investment Company, as amended by any amendment most recently filed with the SEC, including such Borrower's investment objectives and fundamental investment policies and restrictions as may be set forth therein or as such investment objectives and fundamental investment policies and restrictions are set forth in a subsequent vote adopted by the Shareholders of such Borrower. "REGULATION U" shall mean Regulation U of the Board of Governors of the Federal Reserve System, as in effect from time to time. "RENEWAL NOTICE" shall have the meaning specified in Section 14.01 hereof. "REQUEST FOR COMMITTED CREDIT LOAN" shall have the meaning specified in Section 2.04(a) hereof. "REQUEST FOR SWING LINE LOAN" shall have the meaning specified in Section 3.03(a) hereof. "RESTRICTED FUND" shall mean any Borrower designated as such on SCHEDULE 1 annexed hereto, which designation shall be concurred in by the Agents. "SEC" shall mean the Securities and Exchange Commission. -6- "SHARES" shall mean the securities representing beneficial or equity interests in a Borrower. "SHAREHOLDERS" shall mean the owners of Shares of a Borrower. "SPECIFIED PERCENTAGE" shall mean, with respect to any Borrower, the percentage set forth on SCHEDULE 1 annexed hereto, or such other percentage that the Borrower Agent may, from time to time, specify to the Operations Agent in writing; PROVIDED that the aggregate of all such percentages shall at all times equal one hundred percent (100%). "STATE STREET BANK" shall mean State Street Bank and Trust Company, a trust company chartered under the laws of The Commonwealth of Massachusetts. "SUBSIDIARY" of any Person shall mean a corporation of which a majority of the outstanding shares of stock of each class having ordinary voting power is owned by such Person, by one or more Subsidiaries of such Person, or by such Person and one or more of its Subsidiaries. "SWING LINE AMOUNT" shall mean the maximum amount of Swing Line Loans made or to be made by the Swing Line Lender to the Borrowers hereunder, which shall be $50,000,000. "SWING LINE LENDER" shall mean State Street Bank. "SWING LINE LOAN" shall mean any Loan made or to be made to the Borrowers by the Swing Line Lender as contemplated by Section 3.01 hereof. "SWING LINE LOAN ACCOUNT" shall have the meaning specified in Section 3.02 hereof. "SWING LINE PARTICIPATION AMOUNT" shall have the meaning specified in Section 3.05(b) hereof. "SYNDICATION AGENT" shall have the meaning specified in the preamble hereof. "TOTAL ASSETS" shall mean, as applied to any Borrower, the value of the total assets of such Borrower. For purposes of this definition the value of a Borrower's portfolio securities shall be the value of such securities as determined from time to time in a manner consistent with that used by such Borrower for reporting purposes in accordance with regulatory requirements, including the Investment Company Act. "UNFUNDED LIABILITIES" shall mean, with respect to any Plan, at any time, the amount (if any) by which (a) the present value of all benefits under such Plan exceeds (b) the fair market value of all Plan assets allocable to such benefits, all determined as of the then most recent valuation date for such Plan, but only to the extent that such excess represents a potential liability of a Borrower or any member of the Controlled Group to the PBGC or such Plan under Title IV of ERISA. "UNREFUNDED SWING LINE LOANS" shall have the meaning specified in Section 3.05(b) hereof. -7- "WARBURG PINCUS ASSET MANAGEMENT" shall means Warburg Pincus Asset Management, Inc. "YEAR 2000 PROBLEM" shall have the meaning specified in Section 7.18 hereof. Section 1.02. ACCOUNTING TERMS AND DETERMINATIONS. Unless otherwise defined or specified herein, all accounting terms shall be construed herein, all accounting determinations hereunder shall be made, all financial statements required to be delivered hereunder shall be prepared and all financial records shall be maintained in accordance with GAAP. Section 1.03. Other Definitional Terms. (a) The words "hereof", "herein" and "hereunder" and words of similar import when used in this Agreement shall refer to this Agreement as a whole and not to any particular provision of this Agreement, and Article, section, schedule, exhibit and like references are to this Agreement unless otherwise specified. (b) Each reference herein to a particular Person shall include a reference to such Person's successors and permitted assigns. (c) Any defined term which relates to a document, instrument or agreement shall include within its definition any amendments, modifications, renewals, restatements, extensions, supplements or substitutions which may have been heretofore or may be hereafter executed in accordance with the terms hereof and thereof. ARTICLE II. COMMITTED LINE OF CREDIT Section 2.01. COMMITMENT TO LEND. Subject to the terms and conditions set forth in this Agreement, each Bank severally agrees to make Committed Credit Loans to each Borrower from time to time on any Banking Day during the period from the date hereof to but not including the Expiration Date, as may be requested by such Borrower in accordance with Section 2.04 hereof, in an aggregate amount not to exceed at any one time outstanding the amount of such Bank's Commitment. Each Committed Credit Loan made by the Banks to a Borrower hereunder shall be in an amount of $1,000,000 or an integral multiple thereof; PROVIDED that (i) at no time shall any Bank be obligated to fund or maintain Committed Credit Loans in excess of such Bank's Commitment; (ii) at no time shall State Street Bank be obligated to fund or maintain Committed Credit Loans to the extent that the principal amount of such Committed Credit Loans, together with the aggregate principal amount of Swing Line Loans outstanding to the Borrowers hereunder, exceeds State Street Bank's Commitment; (iii) at no time shall the aggregate outstanding principal amount of all Committed Credit Loans made to the Borrowers hereunder exceed the Maximum Committed Credit Amount; (iv) at no time shall the aggregate outstanding principal amount of all Loans made to the Borrowers hereunder exceed the Maximum Credit Amount; and (v) at no time shall the aggregate outstanding principal amount of all Loans made to any Borrower hereunder exceed such Borrower's Borrowing Base. Each request for a Committed Credit Loan by a Borrower shall constitute a representation by such Borrower that the conditions set forth in Section 6.02 hereof have been satisfied on the date of such request. Within the limits of the provisions of this Section 2.01, each Borrower may borrow, prepay pursuant to Section 4.01, and reborrow under this Section 2.01. -8- Section 2.02. REDUCTION OR TERMINATION OF COMMITMENT. (a) The Borrowers, acting through their respective Borrower Agents, may at any time prior to the Expiration Date, (i) terminate the Commitments in full by (A) giving at least three (3) Banking Days' written notice thereof to the Operations Agent (with sufficient copies for itself and the other Banks), and (B) repaying, or causing to be repaid, in full the Loans and any other obligations of the Borrowers hereunder, including, without limitation, accrued and unpaid interest on the Loans, the accrued and unpaid Commitment Fees, and all other fees and expenses provided for herein; or (ii) reduce the Maximum Committed Credit Amount, in part, by an amount not less than $10,000,000 or in multiples of $5,000,000 thereafter by (A) giving at least three (3) Banking Days' written notice thereof to the Operations Agent (with sufficient copies for itself and the other Banks), and (B) repaying the amount, if any, by which the aggregate unpaid principal amount of the Committed Credit Loans exceeds the then reduced Maximum Committed Credit Amount, together with the Commitment Fees accrued with respect to the amount of such reduction to the date of such reduction. Any such partial reduction of the Maximum Committed Credit Amount shall also effect a like reduction in the Maximum Credit Amount and, to the extent that the Maximum Committed Credit Amount is reduced to an amount less than the Swing Line Amount, a like reduction in the Swing Line Amount. Upon the termination of the Commitments pursuant to this Section 2.02(a), this Agreement shall terminate and be of no further force and effect, except as otherwise provided hereinabove, and except for the indemnification obligations of the Borrowers hereunder with respect to Loans made by, or other actions taken by, the Banks or the Operations Agent to, or in respect of, the Borrowers prior to the effective date of such termination, and except for the obligations, if any, of the Banks for the reimbursement to a Borrower of recovered costs under Section 5.01(c) hereof. No termination of the Commitments or reduction of the Maximum Committed Credit Amount by the Borrowers shall be subject to reinstatement. (b) In addition to the provisions of paragraph (a) of this Section 2.02, any Borrower (other than a Borrower, if any, which shall be the sole remaining Borrower hereunder), acting through its Borrower Agent, may terminate its participation in this Agreement and withdraw as a party hereto by (A) giving at least three (3) Banking Days' written notice thereof to the Operations Agent (with sufficient copies for itself and the other Banks), accompanied by a revised SCHEDULE 1 in accordance with Section 4.09 reflecting the withdrawal of such Borrower, and (B) repaying in full the Loans and any other obligations of such Borrower hereunder, including, without limitation, accrued and unpaid interest on the Loans, the accrued and unpaid Commitment Fees, and all other fees and expenses provided for herein to be paid by such Borrower. Upon the effective date of such termination, the Banks' obligations to make Committed Credit Loans to such Borrower hereunder shall terminate, such Borrower shall cease to be a party to this Agreement and this Agreement shall be of no further force and effect as to such Borrower, except as otherwise provided hereinabove, and except for the indemnification obligations of such Borrower hereunder with respect to Loans made by, or other actions taken by, the Banks or the Operations Agent to, or in respect of, such Borrower prior to the effective date of such termination, and except for the rights of such Borrower pursuant to Section 5.01(c) to be reimbursed costs, if any, recovered by the Banks. This Agreement (including the Commitments) shall otherwise remain in full force and effect as to all other Borrowers. -9- (c) Subject to the foregoing and to the provisions of Articles X and XIV hereof, the Commitments shall terminate in full on and as of the Expiration Date. Upon such termination, each Borrower, severally and not jointly, promises to pay, and there shall become absolutely due and payable on the Expiration Date, the principal amount of all Loans outstanding to such Borrower on such date, together with any and all accrued and unpaid interest thereon and fees and other amounts due hereunder. Except as otherwise provided in this Section 2.02, the Borrowers shall not have the right to reduce or terminate the Commitments. Section 2.03. COMMITTED CREDIT LOAN ACCOUNTS. Each Bank will open and maintain a loan account (each a "COMMITTED CREDIT LOAN ACCOUNT") on its books in the name of each Borrower with respect to such Bank's Committed Credit Loans to such Borrower. Each Committed Credit Loan made by a Bank will be debited, and each payment or prepayment on account thereof will be credited, to the Committed Credit Loan Account maintained by such Bank; PROVIDED that the failure of any Bank to record such amounts in its Committed Credit Loan Account shall not affect the obligations of any Borrower hereunder with respect thereto. The Operations Agent shall maintain a record of amounts owing with respect to each Committed Credit Loan Account, which record shall be considered, absent manifest error, PRIMA FACIE evidence of the matters noted therein; PROVIDED that the failure of the Operations Agent to maintain such record shall not affect or impair the validity or binding nature of any Committed Credit Loan Account. Section 2.04. REQUESTS FOR COMMITTED CREDIT LOANS. (a) Each request by a Borrower for a Committed Credit Loan (each a "REQUEST FOR COMMITTED CREDIT LOAN") shall be made by notice to the Operations Agent from the Borrower Agent for such Borrower not later than 1:00 p.m. (Boston time) on the day of the proposed borrowing. The Operations Agent shall give each Bank prompt notice of the Operations Agent's receipt of any Request for Committed Credit Loan. Each Request for Committed Credit Loan shall be in writing in the form of EXHIBIT A hereto, or made by telephonic communication confirmed not later than 1:30 p.m. (Boston time) the same day by telecopy or other facsimile transmission in the form of EXHIBIT A. The Operations Agent may rely upon any telephonic Request for Committed Credit Loan which it reasonably believes is made by a Borrower Agent; PROVIDED that the Operations Agent shall not advance any Committed Credit Loan unless the Operations Agent shall have received confirmation of such telephonic Request for Committed Credit Loan in the manner set forth above. Each Borrower severally agrees to indemnify and hold the Operations Agent and each Bank harmless for any reasonable action taken, including, without limitation, the making of Committed Credit Loans hereunder to such Borrower, or loss or expense incurred, by the Operations Agent or any Bank in good faith reliance upon such telephonic Request for Committed Credit Loan; PROVIDED that no Borrower shall be liable for any such action, loss or expense to the extent that the same shall result from the gross negligence or willful misconduct of the Operations Agent or a Bank, as applicable. At the time the initial Request for Committed Credit Loan is made under this Section 2.04(a), each Borrower shall have provided the Operations Agent and the Banks with an Officer's Certificate as required by Section 6.01(e). Each Borrower hereby agrees that (i) the Operations Agent and each Bank shall be entitled to rely upon the Officer's Certificate in its possession until it is superseded by a more recent Officer's Certificate, and (ii) each Request for Committed Credit Loan submitted by a Borrower shall (A) obligate such Borrower to borrow the -10- principal amount of the Committed Credit Loan requested thereby, and (B) constitute a representation and warranty by such Borrower to the Operations Agent and the Banks that the Committed Credit Loan requested thereby (1) is permitted under such Borrower's Prospectus, (2) will not, when made, cause the aggregate Indebtedness of such Borrower in respect of Loans to exceed such Borrower's Borrowing Base, (3) will not, when made, cause the aggregate Indebtedness of the Borrowers to the Banks in respect of Committed Credit Loans to exceed the Maximum Committed Credit Amount, (4) will not, when made, cause the aggregate Indebtedness of the Borrowers to State Street Bank in respect of Committed Credit Loans and Swing Line Loans to exceed State Street Bank's Commitment, (5) will not, when made, cause the aggregate Indebtedness of the Borrowers to the Banks in respect of Loans to exceed the Maximum Credit Amount, and (6) will be used by the Borrower only in accordance with the provisions of Section 4.08 hereof. (b) Subject to the terms and conditions of this Agreement, each Bank shall, as soon as practicable on the date of a proposed borrowing, and in no event later than 3:00 p.m. (Boston time) on such date, make available to the Operations Agent, at the Operations Agent's address referred to in Section 15.04 hereof and in immediately available funds, such Bank's ratable portion of the Committed Credit Loan requested. After the Operations Agent's receipt of such funds and upon fulfillment of the applicable conditions set forth in Article VI hereof, the Operations Agent will wire or otherwise remit the proceeds of the Committed Credit Loan in immediately available funds to the account of the Borrower making such Request for Committed Credit Loan specified in such Borrower's standing instructions set forth in SCHEDULE 1 hereto not later than the close of business on the date of such Request for Committed Credit Loan. (c) A Request for Committed Credit Loan shall be irrevocable and binding on the Borrower making such Request for Committed Credit Loan, and if the Committed Credit Loan requested is not borrowed on the date specified therein, such Borrower shall indemnify each Bank and the Operations Agent against any loss or expense (excluding lost profits) reasonably incurred by such Bank or Operations Agent by reason of the liquidation or reemployment of deposits or other funds acquired by such Bank or Operations Agent to fund or maintain the Committed Credit Loan. (d) Unless the Operations Agent shall have received notice from a Bank prior to the time of any borrowing that such Bank will not make available to the Operations Agent its ratable portion of the Committed Credit Loan, the Operations Agent may assume that such Bank has made such portion available to the Operations Agent on the date of such borrowing in accordance with and as provided in Section 2.04(b). The Operations Agent may, in reliance upon such assumption, make available on such date a corresponding amount to the Borrower on whose behalf the Request for Committed Credit Loan was made. If, and to the extent, a Bank shall not have made its ratable portion available to the Operations Agent, and the Operations Agent shall have made available the corresponding amount to the Borrower, such Bank agrees to pay the same to the Operations Agent forthwith on demand, and if such Bank shall fail to do so, the Borrower agrees, subject to Section 2.04(e), to repay such amount to the Operations Agent, within two (2) Banking Days after demand, together with interest thereon at the applicable interest rate for each day from the date the Operations Agent shall have made such amount available to the Borrower until the date such amount is paid or repaid to the Operations Agent. If, in the alternative, the Bank in question shall pay to the Operations Agent the corresponding -11- amount, the amount so paid shall constitute such Bank's Committed Credit Loan as part of the requested borrowing for purposes of this Agreement from the date of such payment to the Operations Agent. (e) The failure of any Bank to make the Committed Credit Loans to be made by it as part of any borrowing shall not relieve any other Bank of its obligation, if any, hereunder to make its Committed Credit Loans on the date of such borrowing, but no Bank shall be responsible for the failure of any other Bank to make the Committed Credit Loan to be made by such other Bank on the date of any borrowing. Notwithstanding the foregoing, in the event that a Bank fails to make available to the Operations Agent its ratable portion of a Committed Credit Loan pursuant to Section 2.04(b), State Street Bank and Deutsche Bank AG, New York Branch, severally and not jointly, agree to make available to the requesting Borrower the amount of any such shortfall as a Committed Credit Loan hereunder; PROVIDED that neither State Street Bank nor Deutsche Bank AG, New York Branch shall be required to make such additional Committed Credit Loans to the extent that the amount thereof, together with all other outstanding Committed Credit Loans (and, in the case of State Street Bank, all outstanding Swing Line Loans) made by such Bank exceeds such Bank's Commitment. Section 2.05. REPAYMENT OF COMMITTED CREDIT LOANS. (a) Each Borrower hereby absolutely and unconditionally, severally and not jointly, promises to pay to the Operations Agent for the account of and in trust for each of the Banks, and each Committed Credit Loan made to such Borrower shall mature and the principal amount thereof become due and payable in full, on the earlier to occur of (i) sixty (60) calendar days after the date such Committed Credit Loan is made and (ii) the Expiration Date. (b) Subject to the foregoing provisions of this Section 2.05, a Borrower may apply all or any portion of the proceeds of any Committed Credit Loan made to such Borrower to the repayment of any unpaid principal amount of any other Loan then outstanding to such Borrower; PROVIDED that no Borrower shall have Loans outstanding hereunder on more than sixty (60) consecutive calendar days. ARTICLE III. SWING LINE OF CREDIT Section 3.01. THE SWING LINE OF CREDIT. Subject to the terms and conditions set forth in this Agreement, the Swing Line Lender agrees to make available to the Borrowers a line of credit pursuant to which the Swing Line Lender, in its sole discretion, may make Swing Line Loans to each Borrower from time to time on any Banking Day during the period from the date hereof to but not including the Expiration Date, as may be requested by such Borrower in accordance with Section 3.03 hereof. At no time shall (i) the aggregate outstanding principal amount of all Swing Line Loans made to the Borrowers hereunder exceed the Swing Line Amount, or (ii) the aggregate outstanding principal amount of all Swing Line Loans made to the Borrowers hereunder PLUS the aggregate outstanding principal amount of all Committed Credit Loans made to the Borrowers by State Street Bank hereunder exceed State Street Bank's Commitment, or (iii) the aggregate outstanding principal amount of all Loans made to the Borrowers hereunder exceed the Maximum Credit Amount, or (iv) the aggregate outstanding principal amount of all Loans made to any Borrower hereunder exceed such Borrower's -12- Borrowing Base. Although it shall be within the sole discretion of the Swing Line Lender to make Swing Line Loans under this Agreement, each Borrower agrees and understands that each request for a Swing Line Loan made by a Borrower shall constitute a representation by such Borrower that the conditions set forth in Section 6.02 hereof have been satisfied on the date of such request. Within the limits of the provisions of this Section 3.01, each Borrower may borrow, prepay pursuant to Section 4.01, and reborrow under this Section 3.01. Section 3.02. SWING LINE LOAN ACCOUNT. The Swing Line Lender will open and maintain a loan account (the "SWING LINE LOAN ACCOUNT") on its books in the name of each Borrower with respect to Swing Line Loans made to such Borrower. Each Swing Line Loan made by the Swing Line Lender will be debited, and each payment or prepayment on account thereof will be credited, to the Swing Line Loan Account; PROVIDED that the failure of the Swing Line Lender to record such amounts in the Swing Line Loan Account shall not affect the obligations of the Borrower hereunder with respect thereto. Each Swing Line Loan Account maintained with respect to a Borrower shall be considered, absent manifest error, PRIMA FACIE evidence of the matters noted therein. Section 3.03. REQUESTS FOR SWING LINE LOANS. (a) Each request by a Borrower for a Swing Line Loan under Section 3.01 hereof (each a "REQUEST FOR SWING LINE LOAN") shall be made by notice to the Swing Line Lender from the Borrower Agent for such Borrower not later than 4:00 p.m. (Boston time) on the Banking Day of the proposed borrowing. Each Request for Swing Line Loan shall be in writing in the form of EXHIBIT B hereto, or made by telephonic communication confirmed not later than 4:00 p.m. (Boston time) the same day by telecopy or other facsimile transmission in the form of EXHIBIT B. The Swing Line Lender may rely upon any telephonic Request for Swing Line Loan which it reasonably believes is made by a Borrower Agent; PROVIDED that the Swing Line Lender shall not advance any Swing Line Loan unless the Swing Line Lender shall have received confirmation of such telephonic Request for Swing Line Loan in the manner set forth above. Each Borrower severally agrees to indemnify and hold the Swing Line Lender harmless for any reasonable action taken, including, without limitation, the making of Swing Line Loans hereunder to such Borrower, or loss or expense incurred, by the Swing Line Lender in good faith reliance upon such telephonic Request for Swing Line Loan; PROVIDED that no Borrower shall be liable for any such action, loss or expense to the extent that the same shall result from the gross negligence or willful misconduct of the Swing Line Lender. At the time of the initial Request for Swing Line Loan made under this Section 3.03(a), each Borrower shall have provided the Swing Line Lender with an Officer's Certificate as required by Section 6.01(e). Each Borrower hereby agrees that (i) the Swing Line Lender shall be entitled to rely upon the Officer's Certificate in its possession until it is superseded by a more recent Officer's Certificate, and (ii) each Request for Swing Line Loan submitted by a Borrower shall (A) obligate such Borrower to borrow the principal amount of the Swing Line Loan requested thereby, and (B) constitute a representation and warranty by such Borrower to the Swing Line Lender that (1) the Swing Line Loan requested thereby is permitted under such Borrower's most recent Prospectus, (2) will not, when made, cause the aggregate Indebtedness of such Borrower in respect of Loans to exceed such Borrower's Borrowing Base, (3) will not, when made, cause the aggregate Indebtedness of the Borrowers to the Swing Line Lender in respect of Swing Line Loans to exceed the Swing Line Amount, (4) will not, when made, cause the aggregate Indebtedness of the Borrowers to State -13- Street Bank in respect of Committed Credit Loans and Swing Line Loans to exceed State Street Bank's Commitment, (5) will not, when made, cause the aggregate Indebtedness of the Borrowers to the Banks in respect of Loans to exceed the Maximum Credit Amount, and (6) will be used by the Borrower only in accordance with the provisions of Section 4.08 hereof. (b) Upon fulfillment of the applicable conditions set forth in Article VI hereof, the Swing Line Lender promptly will wire or otherwise remit the proceeds of the Swing Line Loan in immediately available funds to the account of the Borrower making such Request for Swing Line Loan specified in such Borrower's standing instructions set forth in SCHEDULE 1 hereto not later than the close of business on the date of such Request for Swing Line Loan. (c) A Request for Swing Line Loan shall be irrevocable and binding on the Borrower making such Request for Swing Line Loan, and if the Swing Line Loan requested is not borrowed on the date specified therein, such Borrower shall indemnify the Swing Line Lender against any loss or expense (excluding lost profits) reasonably incurred by the Swing Line Lender by reason of the liquidation or reemployment of deposits or other funds acquired by the Swing Line Lender to fund or maintain the Swing Line Loan. Section 3.04. REPAYMENT OF SWING LINE LOANS. (a) Each Borrower hereby absolutely and unconditionally, severally and not jointly, promises to pay to the Swing Line Lender, and each Swing Line Loan made to such Borrower shall mature and the principal amount thereof become due and payable in full, on the earlier to occur of (i) seven (7) Banking Days after the date such Swing Line Loan is made and (ii) the Expiration Date. (b) Subject to the foregoing provisions of this Section 3.04, a Borrower may apply all or any portion of the proceeds of any Swing Line Loan made to such Borrower to the repayment of any unpaid principal amount of any other Loan then outstanding to such Borrower; PROVIDED that no Borrower shall have Loans outstanding hereunder on more than sixty (60) consecutive calendar days. Section 3.05. REFUNDING OF SWING LINE LOANS. (a) The Swing Line Lender, at any time in its sole and absolute discretion may, and on the seventh Banking Day after the borrowing of a Swing Line Loan by a Borrower (if such Swing Line Loan has not been repaid in full) shall, on behalf of such Borrower (and such Borrower hereby irrevocably directs the Swing Line Lender to so act on its behalf and with respect to such Borrower) upon notice given by the Swing Line Lender no later than 1:00 p.m. (Boston time) on the relevant refunding date, request each Bank to make, and each Bank hereby agrees to make, a Committed Credit Loan to such Borrower in an amount equal to such Bank's Facility Percentage of the amount of such Swing Line Loan (the "REFUNDED SWING LINE LOAN") outstanding on the date of such notice, to repay the Swing Line Lender. Each Bank shall make the amount of such Committed Credit Loan available to the Operations Agent in immediately available funds not later than 3:00 p.m. (Boston time) on the date of such notice. The proceeds of such Committed Credit Loans shall be distributed by the Operations Agent to the Swing Line Lender and immediately applied by the Swing Line Lender to repay the Refunded Swing Line -14- Loans. Effective on the day such Committed Credit Loans are made, the portion of the Swing Line Loans so paid shall no longer be outstanding as Swing Line Loans. (b) If, prior to the making of a Committed Credit Loan to a Borrower pursuant to Section 3.05(a) hereof, an Event of Default shall have occurred and be continuing, each Bank severally, unconditionally and irrevocably agrees that it shall purchase a participating interest in the applicable Swing Line Loans (the "UNREFUNDED SWING LINE LOANS") in an amount equal to the amount of Committed Credit Loans which otherwise would have been made by such Bank pursuant to Section 3.05(a). Each Bank shall immediately transfer to the Operations Agent, in immediately available funds, the amount of its participation (the "SWING LINE PARTICIPATION AMOUNT"), and the proceeds of such participation shall be distributed by the Operations Agent to the Swing Line Lender in such amount as will reduce the amount of the participating interest retained by the Swing Line Lender in its Swing Line Loans to the amount of the Committed Credit Loans which were to have been made by the Swing Line Lender pursuant to Section 3.05(a). (c) Whenever, at any time after the Swing Line Lender has received from any Bank such Bank's Swing Line Participation Amount, the Swing Line Lender receives any payment on account of the Swing Line Loans, the Swing Line Lender will distribute to such Bank its Swing Line Participation Amount (appropriately adjusted, in the case of interest payments, to reflect the period of time during which such Bank's participating interest was outstanding and funded and, in the case of principal and interest payments, to reflect such Bank's PRO RATA portion of such payment, if such payment is not sufficient to pay the principal of and interest on all Swing Line Loans then due); PROVIDED, HOWEVER, that, in the event that such payment received by the Swing Line Lender is required to be returned, such Bank will return to the Swing Line Lender any portion thereof previously distributed to it by the Swing Line Lender with interest, as appropriate. (d) Each Bank's obligation to make the Committed Credit Loans referred to in Section 3.05(a) and to purchase participating interests pursuant to Section 3.05(b) shall be absolute and unconditional and shall not be affected by any circumstance, including, without limitation, (i) any setoff, counterclaim, recoupment, defense or other right which such Bank may have against the Swing Line Lender or any other Person for any reason whatsoever; (ii) the occurrence or continuance of a Default or the failure to satisfy any of the other conditions specified in Section 6.02 hereof; (iii) any adverse change in the condition (financial or otherwise) of any Borrower; (iv) any breach of this Agreement or any other Loan Document by any Borrower or Bank; or (v) any other circumstance, happening or event whatsoever, whether or not similar to any of the foregoing. ARTICLE IV. CERTAIN COMMON PROVISIONS Section 4.01. OPTIONAL PREPAYMENTS; CERTAIN MANDATORY PREPAYMENTS. (a) Each Borrower shall have the right at any time, without premium or penalty, to prepay the Committed Credit Loans made to such Borrower hereunder, in whole or in part, upon telephonic notice to the Operations Agent of its intention to prepay such Committed Credit Loans prior to 1:00 p.m. (Boston time) on the date such prepayment is to be made; -15- PROVIDED, HOWEVER, that each such prepayment (other than a prepayment in full) shall be in an amount of $1,000,000 or an integral multiple thereof; and FURTHER PROVIDED that each such telephonic notice shall be confirmed in writing not later than 1:30 p.m. (Boston time) the same day by telecopy or other facsimile transmission in the form of EXHIBIT C. (b) Each Borrower shall have the right at any time, without premium or penalty, to prepay the Swing Line Loans made to such Borrower hereunder, in whole or in part, upon telephonic notice to the Swing Line Lender of its intention to prepay such Swing Line Loan prior to 4:00 p.m. (Boston time) on the date such prepayment is to be made; PROVIDED, HOWEVER, that each such telephonic notice shall be confirmed in writing not later than 4:00 p.m. (Boston time) the same day by telecopy or other facsimile transmission in the form of EXHIBIT D. (c) If, at any time, the aggregate unpaid principal amount of Loans to any Borrower shall exceed such Borrower's Borrowing Base, the Borrower shall immediately prepay such excess amount within three (3) Banking Days. (d) Upon any reduction of the Maximum Committed Credit Amount pursuant to Section 2.02(a) hereof or otherwise, or if, at any time, the aggregate unpaid principal amount of Committed Credit Loans exceeds the Maximum Committed Credit Amount, each Borrower that, at such time, has outstanding Committed Credit Loans agrees to prepay within three (3) Banking Days after demand by the Banks or the Operations Agent, on behalf of the Banks, its PRO RATA portion of the amount, if any, by which the aggregate unpaid principal amount of Committed Credit Loans made to the Borrowers hereunder exceeds the Maximum Committed Credit Amount. (e) If, at any time, the aggregate unpaid principal amount of Swing Line Loans exceeds the Swing Line Amount, each Borrower that, at such time, has outstanding Swing Line Loans agrees to prepay within three (3) Banking Days after demand by the Swing Line Lender its PRO RATA portion of such excess amount. (f) Upon any reduction of the Maximum Credit Amount pursuant to Section 2.02(a) hereof or otherwise, or if, at any time, the aggregate unpaid principal amount of Loans exceeds the Maximum Credit Amount, each Borrower that, at such time, has outstanding Loans agrees to prepay within three (3) Banking Days after demand by the Banks or the Operations Agent, on behalf of the Banks, its PRO RATA portion of such excess amount. Section 4.02. PLACE AND MODE OF PAYMENTS; COMPUTATIONS. (a) Each Borrower shall give notice to the Operations Agent of each payment to be made by it hereunder in respect of Committed Credit Loans not later than 1:00 p.m.(Boston time) on the day when due; PROVIDED that such notice, if made by telephonic communication, shall be confirmed in writing not later than 1:30 p.m. (Boston time) the same day by telecopy or other facsimile transmission in the form of EXHIBIT C. Each such payment shall be made in lawful money of the United States to the Operations Agent at its address set forth in Section 15.04 in immediately available and freely transferable funds, and shall be received by the Operations Agent not later than 2:00 p.m. (Boston time) on the day when due. The Operations Agent will, promptly after its receipt thereof, distribute like funds relating to the payment of -16- principal, interest, Commitment Fees or other amounts payable to the Banks for their respective accounts, as appropriate. (b) Each Borrower shall give notice to the Swing Line Lender of each payment to be made by it hereunder in respect of Swing Line Loans not later than 4:00 p.m. (Boston time) on the day when due; PROVIDED that such notice, if made by telephonic communication, shall be confirmed in writing not later than 4:00 p.m. (Boston time) the same day by telecopy or other facsimile transmission in the form of EXHIBIT D. Each such payment shall be made in lawful money of the United States to the Swing Line Lender at its address set forth on Section 15.04 in immediately available and freely transferable funds, and shall be received by the Swing Line Lender not later than 5:00 p.m. (Boston time) on the day when due. (c) Unless the Operations Agent shall have received notice from a Borrower prior to the date on which any payment is due to the Banks hereunder that such Borrower will not make such payment in full, the Operations Agent may assume that such Borrower has made such payment in full to the Operations Agent on such date and the Operations Agent may (but it shall not be required to), in reliance upon such assumption, cause to be distributed to each Bank on such due date an amount equal to the amount then due such Bank. If and to the extent that such Borrower shall not have so made such payment, each Bank shall repay to the Operations Agent forthwith on demand such amount distributed to such Bank, together with interest thereon, for each day from the date such amount was so distributed until the date such Bank repays such amount to the Operations Agent, calculated at the Federal Funds Effective Rate, or, if such amount is not repaid to the Operations Agent within three (3) Banking Days, at the rate applicable to the Loan purported to be repaid or prepaid by such Borrower. (d) All payments by the Borrowers hereunder shall be made without setoff or counterclaim and free and clear of and without deduction or withholding of any kind (all of which will be paid by the Borrowers for their respective accounts if required by law prior to the date penalties are attached). If any such deduction or withholding obligation is imposed upon a Borrower with respect to any amount payable by it hereunder in respect of Committed Credit Loans, it will pay to the Operations Agent, for the benefit of the affected Bank(s), on the date on which such amount becomes due and payable hereunder such additional amount as shall be necessary to enable each of the Banks to receive the same net amount which each would have received on such due date had no such obligation been imposed upon such Borrower. If any such deduction or withholding obligation is imposed upon a Borrower with respect to any amount payable by it hereunder in respect of Swing Line Loans, it will pay to the Swing Line Lender on the date on which such amount becomes due and payable hereunder such additional amount as shall be necessary to enable the Swing Line Lender to receive the same net amount which it would have received on such due date had no such obligation been imposed upon such Borrower. The foregoing provisions of this Section 4.02(d) shall not apply, in the case of each Bank (or permitted assignee of any Bank or any participant), the Swing Line Lender and the Operations Agent, (i) to taxes imposed upon or by reference to its overall net income, profits or gains, or (ii) to franchise taxes imposed on it except in a jurisdiction in which such Bank, the Swing Line Lender or the Operations Agent is not doing business other than extending credit hereunder to the Borrowers, or (iii) if such Bank, the Swing Line Lender or the Operations Agent does not comply with the provisions of Section 4.06 hereof. Notwithstanding anything herein to the contrary, no financial institution organized under the laws of a jurisdiction other than the -17- United States of America or any political subdivision thereof shall be a Bank hereunder or a permitted assignee of any Bank or participant unless it shall certify, as of the date of its becoming a Bank hereunder or, as the case may be, as of the effective date of such assignment or participation, that it is not subject to withholding taxes on its United States source income; PROVIDED that if a financial institution is or becomes a Bank hereunder or a permitted assignee of any Bank or participant and it shall be unable to make such certification, each Borrower agrees to pay in a timely manner any obligation imposed on such Borrower for withholding taxes on the institution's United States source income, but such Borrower shall not be required to pay such additional amount to the Operations Agent for the benefit of the affected institution(s) as otherwise provided in this Section 4.02(d). Even with such certification, any permitted assignee of any Bank or participant shall be subject to this Section 4.02(d) and the provisions of Section 4.06; PROVIDED that in no event shall any permitted assignee of any Bank or participant be entitled to receive any greater amount pursuant to this Section 4.02(d) than the original Bank would have been entitled to receive. Each Borrower will deliver promptly to the Operations Agent or the Swing Line Lender, as applicable, certificates or other valid vouchers for all taxes or other charges deducted from or paid with respect to payments made by such Borrower hereunder. Each Bank, each permitted assignee of any Bank, and each participant agrees that it will use reasonable efforts (consistent with its internal policy and legal and regulatory restrictions, and sol long as such efforts would not be materially disadvantageous to it) promptly to designate a different lending office if the designation of such alternative office would reduce or eliminate any required payments by the Borrower under this Section 4.02(d). (e) If any sum would, but for the provisions of this Section 4.02(e), become due and payable to the Banks (or any of them) or the Swing Line Lender by a Borrower under this Agreement on any day which is not a Banking Day, then such sum shall become due and payable on the Banking Day next succeeding the day on which such sum would otherwise have become due and payable hereunder, and interest and fees payable to the Banks (or any of them) or the Swing Line Lender under this Agreement shall be adjusted accordingly. (f) All computations of interest and fees, including Commitment Fees, payable under this Agreement in respect of Committed Credit Loans shall be made by the Operations Agent on the basis of a 360-day year and paid for the actual number of days elapsed. All computations of interest and fees payable under this Agreement in respect of Swing Line Loans shall be made by the Swing Line Lender on the basis of a 360-day year and paid for the actual number of days elapsed. (g) Each determination of an interest rate applicable to Committed Credit Loans by the Operations Agent pursuant to this Agreement shall be conclusive and binding on the Borrowers and the Banks if made in good faith and in the absence of manifest error. Each determination of an interest rate applicable to Swing Line Loans by the Swing Line Lender pursuant to this Agreement shall be conclusive and binding on the Borrowers if made in good faith and in the absence of manifest error. Section 4.03. INTEREST. (a) Each Borrower hereby absolutely and unconditionally, severally and not jointly, promises to pay (i) to the Operations Agent for the ratable benefit of the Banks, in the -18- case of Committed Credit Loans, and (ii) to the Swing Line Lender, in the case of Swing Line Loans, and there shall become absolutely due and payable, at the times specified in Section 4.03(b) below, all of the unpaid interest accrued on the principal amount of the Loans outstanding to such Borrower hereunder from time to time. Whenever any interest on and any principal of the Loans are paid simultaneously hereunder, the whole amount paid shall be applied first to interest then due and payable. (b) Except as otherwise provided in Section 4.04 hereof, the outstanding principal amount of each Loan shall bear interest from the date of such Loan until repayment thereof in full at the Federal Funds Rate. Interest accrued on each Loan to a Borrower shall be payable monthly in arrears on the fifteenth Banking Day of each calendar month for the immediately preceding calendar monthly period, and at the expiration or earlier termination of this Agreement with respect to such Borrower. Thereafter, interest shall be payable on demand. (c) Subject to the provisions of Sections 2.05(b) and 3.04(b) hereof, any Borrower may apply all or any portion of the proceeds of any Loan made to such Borrower to the payment of any accrued and unpaid interest on any other Loan then outstanding to such Borrower. Section 4.04. OVERDUE PRINCIPAL AND INTEREST. In the event that any Borrower shall fail to make any payment of principal of, or interest on, any Loan when due, whether at maturity or by acceleration or otherwise, interest on such unpaid principal and (to the extent permitted by law) on such unpaid interest shall thereafter be payable on demand at a rate per annum equal to two percent (2%) above the rate otherwise applicable to such Loan hereunder. Section 4.05. LIMITATION ON INTEREST. No provision of this Agreement shall require the payment or permit the collection of interest in excess of the rate then permitted by applicable law. Section 4.06. WITHHOLDING TAX EXEMPTION. No later than five (5) Banking Days prior to the first date on which interest or fees are payable hereunder for the account of any Bank, each Bank that is not incorporated under the laws of the United States of America or a state thereof agrees that it will deliver to the Borrowers and the Operations Agent, two duly completed copies of the United States Internal Revenue Service Form W-8BEN or W-8ECI (or any successor forms), certifying in either case that such Bank is entitled to receive payments under this Agreement without deduction or withholding of any United States federal income taxes. Each Bank which so delivers a Form W-8BEN or W-8ECI further undertakes to deliver to the Borrowers and the Operations Agent two additional copies of such form (or a successor form) on or before the date that such form expires or becomes obsolete or after the occurrence of any event requiring a change in the most recent form so delivered by it, and such amendments thereto or extensions or renewals thereof as may be reasonably requested by the Borrowers or the Operations Agent, in each case certifying that such Bank is entitled to receive payments under this Agreement without deduction or withholding of any United States federal income taxes, unless an event (including, without limitation, any change in treaty, law or regulation) has occurred prior to the date on which any such delivery would otherwise be required which renders all such forms inapplicable or which would prevent such Bank from duly completing and delivering any such form with respect to it and such Bank advises the Borrowers and the -19- Operations Agent that it is not capable of receiving payments without any deduction or withholding of United States federal income tax. Section 4.07. INCREASED CAPITAL REQUIREMENTS. If any Bank shall have determined that the adoption or implementation of any applicable law, rule or regulation regarding capital requirements for banks or bank holding companies, or any change therein (including, without limitation, any change according to a prescribed schedule of increasing requirements, whether or not known on the date of this Agreement), or any change in the interpretation or administration thereof by any governmental authority, central bank or comparable agency charged with the interpretation or administration thereof, or compliance by such Bank with any request or directive of any such Person regarding capital adequacy (whether or not having the force of law) has the effect of reducing the return on such Bank's capital to a level below that which such Bank could have achieved (taking into consideration such Bank's policies with respect to capital adequacy immediately before such adoption, implementation, change or compliance and assuming that such Bank's capital was fully utilized prior to such adoption, implementation, change or compliance) but for such adoption, implementation, change or compliance as a consequence of such Bank's participation in the credit facilities established hereunder, including its commitment to make Committed Credit Loans, by any amount reasonably deemed by such Bank to be material, the Borrowers shall, upon five (5) Banking Days' prior notice to the Borrower Agent for each Borrower from such Bank (with a copy to the Operations Agent), pay to the Operations Agent for the benefit of such Bank as an additional fee from time to time on demand such amount as such Bank shall have determined to be necessary to compensate it for such reduction. The determination by such Bank (in consultation with the Operations Agent) of such amount, if done in good faith on the basis of any reasonable averaging and attribution methods, shall, in the absence of manifest error, be conclusive, and, at the request of the Borrowers, such Bank shall demonstrate the basis for such determination. No Borrower shall be required to compensate any Bank under this Section 4.07 for any reduction incurred more than 180 days prior to the date such Bank notifies the Borrower Agent of the event giving rise to such reduction and of such Bank's intention to claim compensation therefor. Section 4.08. USE OF PROCEEDS. Each Borrower will use the proceeds of the Loans solely for temporary or emergency purposes, including, without limitation, the temporary financing of repurchases or redemptions of Shares of such Borrower and, in the case of any Borrower that is a closed-end Investment Company, the payment of dividends; PROVIDED that such use of proceeds shall either (i) constitute an "Exempt" Transaction" as described in section 221.6(f) of Regulation U (12 CFR Part 221) of the Board or shall otherwise constitute an "Exempted Transaction" under, or shall not constitute a "purpose credit" for purposes of, Regulation U, or (ii) such use of proceeds shall not otherwise cause such Loans to violate the provisions of Regulation U. Without limiting the foregoing, no Borrower will, directly or indirectly, use any part of such proceeds for any purpose which would violate any provision of any applicable statute, regulation, order or restriction. In the event that the proposed use of proceeds of any Loan to a Borrower shall not constitute an "Exempted Transaction" under Regulation U, but shall nonetheless constitute a "purpose credit" for purposes thereof, the Borrower, at the time the Borrowing Request is made, shall furnish each Bank, the relevant lending Bank or the Swing Line Lender (as applicable) with a statement in conformity with the requirements of Federal Reserve Form F.R. U-1 referred to in said Regulation U. -20- Section 4.09. BORROWER AGENTS. Each Borrower hereby appoints each person who shall now or hereafter serve as an Authorized Officer of the Borrower to act as its agent hereunder (individually, a "BORROWER AGENT" and collectively, the "BORROWER AGENTS") with such powers as are specifically delegated to the Borrower Agents by the terms of this Agreement, together with such other powers as are reasonably incidental thereto. Each Borrower shall cause its respective Borrower Agents: (i) to prepare and submit Borrowing Requests in compliance with the terms hereof; (ii) to notify the Operations Agent pursuant to Section 2.02 of the termination of this Agreement and the termination or reduction of the Commitments; and (iii) upon the admission of any new Borrower pursuant to Article XIII, the withdrawal of a Borrower pursuant to Section 2.02(b) or at such other times as the Borrowers shall deem it appropriate, to promptly reallocate the percentages of the Commitment Fee and other fees and expenses payable by each Borrower hereunder among the Borrowers entitled to borrow hereunder, after giving effect to such admission or withdrawal, as the case may be, if any, and notify the Operations Agent in a writing signed by one or more Borrower Agents on behalf of each Borrower (with copies to each Bank and the Swing Line Lender) of the new percentages, at which time SCHEDULE 1 shall be revised to reflect the adjustment in such percentages and/or the admission or withdrawal, as the case may be, of such Borrower. Section 4.10. TAKE-OUT OF INDIVIDUAL BANKS. Upon the assertion of a claim for additional fees and expenses under Sections 4.02(d), 4.06, 4.07 or 5.01(b) by any Bank, other than a claim based on facts or circumstances affecting financial institutions generally, the Borrowers may (so long as no Default exists or would result after giving effect to the Borrowers' action under this Section 4.10) prepay in full all Loans and other obligations owed the individual Bank or Banks with respect to which the Borrowers are exercising their rights hereunder (including, without limitation, any amounts owed to such Bank or Banks under Sections 4.02(d), 4.06, 4.07 and 5.01(b)), and terminate the Commitment(s) of such Bank(s), in each case after appropriate notice as required by Sections 2.02(a) and 4.01, and subject to all other provisions of this Agreement. Except as provided hereinbelow, such action shall reduce the Maximum Committed Credit Amount by the relevant amount and shall result in an automatic corresponding change in the remaining Banks' Facility Percentages so that they total one hundred percent (100%). Notwithstanding the foregoing, in the event that the Borrowers and the Operations Agent are able to reach agreement with a substitute commercial bank(s) to simultaneously accept the Commitment(s) being terminated pursuant to this Section 4.10, and to thereby become a Bank hereunder, the Maximum Committed Credit Amount shall not be reduced and the Facility Percentages shall remain unchanged, other than to effect the change to the substitute Bank(s). The substitute commercial bank(s) shall become a Bank hereunder upon the effective date of such substitution, at which time the Operations Agent shall revise SCHEDULE 2 to reflect the necessary changes. The Operations Agent shall forward a copy of the revised SCHEDULE 2 to the Banks and the Borrowers. Section 4.11. SHARING OF PAYMENTS; ETC. If any Bank shall obtain any payment on account of the Committed Credit Loans (whether voluntary, involuntary, through the exercise of any right of setoff, or otherwise) in excess of its ratable share (according to the then outstanding principal amount of the Committed Credit Loans) of payments on account of the Committed Credit Loans obtained by all Banks (other than as a result of payments made pursuant to Sections 2.04(c), 4.02(d), 4.07 or 5.01 hereof), the Bank shall purchase from the other Banks such participations in the Committed Credit Loans held by them as shall cause the purchasing Bank to -21- share such payment ratably according to the then outstanding principal amount of the Committed Credit Loans with each of them; PROVIDED that if all or any portion of such payment is thereafter recovered from the purchasing Bank, the purchase shall be rescinded and the purchase price restored to the extent of such recovery, but without interest. Each Borrower agrees that any Bank so purchasing a participation in such Borrower's Committed Credit Loans from another Bank pursuant to this Section 4.11 may, to the fullest extent permitted by law, exercise all its rights of payment with respect to such participation as fully as if such Bank were the direct creditor of such Borrower in the amount of such participation. ARTICLE V. FEES Section 5.01. COMMITMENT FEES. (a) The Borrowers shall pay to the Operations Agent for the ratable benefit of the Banks, and in accordance with the Specified Percentages, a commitment fee (the "COMMITMENT FEE") for the period commencing on the date hereof to and including the termination of the Commitments hereunder equal to seven and one-half (7-1/2) basis points (75/1000 of 1%) per annum of the average daily unused portion of the Commitments without reduction for outstanding Swing Line Loans. The Commitment Fee shall be payable quarterly in arrears on the fifteenth Banking Day of each April, July, October and January of each year for the calendar quarter ending as of the last day of the immediately preceding month, commencing on the first such date next succeeding the date hereof, and, in connection with the partial reduction of the Maximum Committed Credit Amount in accordance with Section 2.02(a) hereof, on the date of such reduction, and on the date of any termination of any of the Commitments. With respect to each quarterly payment, the Commitment Fee shall be computed on the basis of the average daily unused portion of the Commitments during such quarter or shorter period without reduction for Swing Line Loans outstanding during such period. (b) Without duplication of the amounts payable pursuant to Section 4.07 hereof, if any change in any requirement imposed upon any Bank by any law of the United States of America or any state or political subdivision thereof to which such Bank may be subject or by any regulation, order, interpretation, ruling or official directive (whether or not having the force of law) of the Board, the FDIC or any other board or governmental or administrative agency of the United States of America or any state or political subdivision thereof to which such Bank may be subject shall impose, increase, modify or deem applicable any reserve, special deposit, assessment or other requirement against the Commitment of such Bank hereunder, and the result of the foregoing, in the reasonable determination of such Bank (in consultation with the Operations Agent), is to impose a cost on such Bank that is attributable to it maintaining its Commitment hereunder, then upon five (5) Banking Days' prior notice to the Borrowers from such Bank (with a copy to the Operations Agent), the Commitment Fee payable to such Bank shall be increased, for so long as such increased cost is imposed, to the extent such Bank determines is necessary to compensate it for such increased cost. The determination by such Bank of the amount thereof, if made in good faith, shall, in the absence of manifest error, be conclusive, and, at the request of the Borrowers, such Bank shall demonstrate the basis for such determination. -22- (c) No portion of the Commitment Fee paid by any Borrower shall be subject to refund, reduction or proration, PROVIDED, HOWEVER, if, after any adjustment in the Commitment Fee pursuant to paragraph (b) of this Section 5.01, any part of the increased cost paid by a Bank is subsequently recovered, such Bank shall reimburse the Borrowers to the extent of the amount so recovered. A certificate of an officer of such Bank setting forth the amount of such recovery and the basis thereof (or such other communication as shall be consistent with the policy of such Bank), if made in good faith, shall, in the absence of manifest error, be conclusive. Section 5.02. OPERATIONS AGENT'S FEE. The Borrowers shall pay, in accordance with the Specified Percentages, the Operations Agent for its own account a fee (the "OPERATIONS AGENT'S FEE") equal to Fifteen Thousand Dollars ($15,000.00). The Operations Agent's Fee shall be payable annually in advance on the date of this Agreement and on the effective date of any renewal of the Commitments pursuant to Article XIV hereof. Section 5.03. ADMINISTRATIVE AGENT'S FEE. The Borrowers shall pay, in accordance with the Specified Percentages, the Administrative Agent for its own account on the date of this Agreement a fee (the "ARRANGING Fee") in an amount to be agreed upon by the Borrowers and the Administrative Agent. Section 5.04. ALLOCATION FEE. The Borrowers shall pay, in accordance with the Specified Percentages, the Operations Agent for the ratable benefit of the Banks on the date of this Agreement an allocation fee (the "ALLOCATION FEE") in an amount equal to two and one-half (2-1/2) basis points (25/1000 of 1%) of the aggregate Commitments. ARTICLE VI. CONDITIONS PRECEDENT Section 6.01. CONDITIONS TO CLOSING. At the time this Agreement is duly executed and delivered by the Borrowers: (a) Each Loan Document shall be in form and substance satisfactory to the Operations Agent and each Bank, shall have been duly and properly authorized, executed and delivered by the respective party or parties thereto, and shall be in full force and effect on the date hereof. Executed original counterparts of each Loan Document shall have been furnished to the Operations Agent with sufficient copies for itself and the other Banks; (b) The Operations Agent shall have received from each Borrower (with sufficient copies for itself and the other Banks) certified copies of its charter, articles of association, declaration of trust and bylaws, as applicable, and copies of its most recent Prospectus; (c) The Operations Agent shall have received from each Borrower (with sufficient copies for itself and the other Banks) a long-form legal existence certificate, together with a good standing certificate, issued with respect to such Borrower as of a recent date by the relevant governmental authority in the jurisdiction of such Borrower's organization. (d) The Operations Agent shall have received from each Borrower (with sufficient copies for itself and the other Banks) certified copies of all documents relating to its due authorization and execution of the Loan Documents as the Operations Agent and the Banks -23- may reasonably request, including, without limitation, all resolutions of such Borrower's Board of Trustees or Board of Directors, as applicable, authorizing (i) its execution and delivery of each of the Loan Documents to which it is or is to become a party, (ii) its performance of all of its agreements and obligations under each of such documents, and (iii) the borrowings and other transactions contemplated by this Agreement; (e) The Operations Agent shall have received from each Borrower (with sufficient copies for itself and the other Banks) a certificate (an "OFFICER'S CERTIFICATE"), dated the date hereof, signed by the Secretary or Assistant Secretary of such Borrower, setting forth the name and bearing a specimen signature of each individual who shall be authorized to (i) sign, in the name and on behalf of such Borrower, each Loan Document to which it is a party, and (ii) give notices and to take other action on behalf of such Borrower in connection with the transactions contemplated by this Agreement; (f) The Operations Agent shall have received for itself and each of the other Banks from each Borrower a duly completed and executed Federal Reserve Form F.R. U-1; (g) The Operations Agent shall have received from each Borrower (with sufficient copies for itself and the other Banks) a copy of such Borrower's current Year 2000 Disclosure in accordance with Section 7.18 hereof; (h) The Operations Agent shall have received from the Borrowers (with sufficient copies for itself and the other Banks) the favorable opinion or opinions of counsel for the Borrowers, dated as of the date hereof and addressing the substantive issues set forth in EXHIBIT G hereto, such opinion or opinions to be reasonably satisfactory to the Operations Agent and the Banks; (i) Each Borrower shall have performed and complied in all material respects with all terms and conditions herein required to be performed or complied with by it on or prior to the date hereof, and the consummation of the transactions on the date hereof shall not result in a Default; (j) The Operations Agent shall have received from each Borrower (with sufficient copies for itself and the other Banks) a certificate, dated as of the date hereof and in form and substance satisfactory to the Operations Agent and the Banks, in which such Borrower shall represent and warrant to the Operations Agent and the Banks all of the matters set forth in Article VII hereof, and shall represent and warrant to the Operations Agent and the Banks that the conditions precedent set forth in paragraph (i) of this Section 6.01 are satisfied at and as of the date of this Agreement; (k) The Operations Agent shall have received the Operations Agent's Fee from the Borrowers as provided in Section 5.02 hereof; (l) The Administrative Agent shall have received the Arranging Fee from the Borrowers as provided in Section 5.03 hereof; (m) The Operations Agent shall have received for the ratable benefit of the Banks the Allocation Fee from the Borrowers as provided in Section 5.04 hereof; -24- (n) The Operations Agent shall received evidence reasonably satisfactory to the Operations Agent and the Banks of the termination of existing credit facilities with Deutsche Bank AG and PNC Bankcorp; (o) The Operations Agent and the Banks shall be satisfied that there has been no material adverse change in the business, assets, operations, prospects or condition (financial or otherwise) of any Borrower since the date of the latest financial statements delivered to the Operations Agent and Banks and referred to in Section 7.02 hereof; (p) Without, in any way, limiting the scope of paragraph (o) above, the Operations Agent and the Banks shall be satisfied that there has been no material adverse change in any law, rule, regulation, decree or order of any governmental authority binding upon any Borrower or otherwise applicable to the Operations Agent, the Banks or any Borrower; and (q) The Operations Agent and the Banks shall have received all other information and documents which the Operations Agent and the Banks may reasonably have requested in connection with the transactions contemplated by this Agreement, such information and documents where appropriate to be certified by the proper officers of each Borrower or governmental authorities. Section 6.02. CONDITIONS PRECEDENT TO ALL LOANS. The obligation of the Banks to make any Committed Credit Loan to a Borrower, and/or the Swing Line Lender to make any Swing Line Loan hereunder to a Borrower (it being understood that any decision to make a Swing Line Loan to a Borrower shall be within the sole discretion of the Swing Line Lender), is subject to the following conditions: (a) Either (i) the Operations Agent shall have received a Request for Committed Credit Loan from such Borrower as required by Section 2.04(a) hereof, or (ii) the Swing Line Lender shall have received a Request for Swing Line Loan from such Borrower as required by Section 3.03(a) hereof; (b) The representations and warranties of such Borrower contained in Article VII hereof shall be true on and as of such date as if they had been made on such date (except to the extent that such representations and warranties expressly relate to an earlier date or are affected by the consummation of transactions permitted under this Agreement); (c) Such Borrower shall be in compliance in all material respects with all of the terms and provisions set forth herein on its part to be observed or performed on or prior to such date; (d) The making of the Loan shall not contravene any law, regulation, decree or order binding on such Borrower, the Operations Agent, the Swing Line Lender or the Banks; and (e) After giving effect to the Loans to be made on such date to such Borrower, no Default with respect to such Borrower, shall have occurred and be continuing. -25- Each Borrowing Request made by a Borrower shall constitute a representation and warranty by such Borrower to the Operations Agent and the Banks (in the case of a Request for Committed Credit Loan) and the Swing Line Lender (in the case of a Request for Swing Line Loan) that all of the conditions specified in this Section 6.02 have been satisfied in all material respects by such Borrower as of the date of the Loan. ARTICLE VII. REPRESENTATIONS AND WARRANTIES In order to induce the Banks and the Operations Agent to enter into this Agreement and to make the Loans provided for hereunder, each Borrower, severally and not jointly, makes the following representations and warranties with respect to itself, which shall survive the execution and delivery hereof; PROVIDED that, where appropriate, the reference herein to "the Borrower" shall be deemed to be a reference to the Investment Company of which such Borrower is a Portfolio: Section 7.01. ORGANIZATION, STANDING, ETC. OF THE BORROWER. SCHEDULE 1 accurately and completely lists the full legal name of the Borrower, its principal business address, the nature of its organization and the jurisdiction of its organization. The Borrower is legally organized as specified on SCHEDULE 1, validly existing and in good standing under the laws of the jurisdiction of its organization and has all requisite power and authority to own and operate its properties and assets, to carry on its business as now conducted and proposed to be conducted, to enter into this Agreement and all other documents to be executed by it in connection with the transactions contemplated hereby and to carry out the terms hereof and thereof. Section 7.02. FINANCIAL INFORMATION; DISCLOSURE; ETC. The statement of assets and liabilities (or statement of net assets, as applicable) of the Borrower as of its most recently ended fiscal year for which annual reports have been prepared and the related statements of operations and of changes in net assets for the fiscal year ended on such date, copies of which financial statements, certified by the independent public accountants for the Borrower, have heretofore been delivered to the Operations Agent and the Banks, fairly present, in all material respects, the financial position of the Borrower as of such date and the results of its operations for such period, in conformity with GAAP. Since the date of the latest financial statements so delivered to the Operations Agent and the Banks, there has been no material adverse change in the business, assets, operations, prospects or condition (financial or otherwise) of the Borrower. Neither this Agreement nor any financial statements, reports or other documents or certificates furnished to the Operations Agent and the Banks by the Borrower in connection with the transactions contemplated hereby or thereby (when taken as a whole) contain any untrue statement of a material fact or omit to state any material fact necessary to make the statements herein or therein contained not misleading. None of the Loans will render the Borrower unable to pay its debts as they become due; the Borrower is not contemplating either the filing of a petition by it under any state or federal bankruptcy or insolvency laws or the liquidation of all or a major portion of its property except in the ordinary course of the Borrower's business; and the Borrower has no knowledge of any Person contemplating the filing of any such petition against it. Section 7.03. LITIGATION; ETC. There is no action, proceeding or investigation pending or threatened (or any basis therefor known to the Borrower) which questions the validity of this -26- Agreement or the other documents executed in connection herewith, or any action taken or to be taken pursuant hereto. Except as disclosed in Schedule 7.03 hereto, there is no such action, proceeding or investigation pending or threatened in which there is a reasonable possibility of an adverse decision and which could, either in any case or in the aggregate, adversely affect the ability of the Borrower to perform its obligations hereunder or under the other documents executed in connection herewith. Section 7.04. AUTHORIZATION; COMPLIANCE WITH OTHER INSTRUMENTS. The execution, delivery and performance of this Agreement and the other Loan Documents have been duly authorized by all necessary action on the part of the Borrower, will not result in any violation of or be in conflict with or constitute a default under any term of the Prospectus of the Borrower or of its charter, articles of association, declaration of trust or bylaws, or of any investment, borrowing or other similar type of policy or restriction to which the Borrower is subject or of any agreement, instrument, judgment, decree, order, statute, rule or governmental regulation applicable to the Borrower, or result in the creation of any mortgage, lien, charge or encumbrance upon any of the properties or assets of the Borrower pursuant thereto. The Borrower is not in violation of any material term of its Prospectus or of its charter, articles of association, declaration of trust or bylaws, or of any investment, borrowing or other similar type of policy or restriction to which the Borrower is subject or of any material term of any material agreement or instrument to which it is a party, or, to the best of the Borrower's knowledge, of any judgment, decree, order, statute, rule or governmental regulation applicable to it, the violation of which could, either in any case or in the aggregate, adversely effect the ability of the Borrower to continue its present business or to perform its obligations hereunder or under the other Loan Documents. Section 7.05. SEC COMPLIANCE; ETC. Without limiting the scope of Section 7.04, the Borrower is in compliance with all federal and state securities or similar laws and regulations, including but not limited to all material rules, regulations and administrative orders of the SEC and applicable state blue sky authorities, and with all statutory and regulatory requirements of any other applicable jurisdiction, except where the failure to so comply is not reasonably likely to result in a Material Adverse Effect. The Borrower is not in violation of Section 18 of the Investment Company Act. To the best of its knowledge, the Borrower is not in violation of any other provision of the Investment Company Act, except insofar as such violation would not result in a Material Adverse Effect. The Borrower has filed all reports with the SEC that are required of it. Section 7.06. BINDING EFFECT. This Agreement and the other Loan Documents have been duly executed and delivered by or on behalf of the Borrower, and constitute valid and binding obligations of the Borrower enforceable in accordance with their respective terms. Section 7.07. GOVERNMENTAL CONSENT. Except for any routine filings required under federal and state securities laws, the Borrower is not required to obtain any order, consent, approval or authorization of, or required to make any declaration or filing with, any governmental authority in connection with the execution and delivery of this Agreement. Section 7.08. REGULATION U; ETC. None of the proceeds of any Loan will be used, directly or indirectly, by the Borrower for any purpose which might cause this Agreement to -27- violate Regulation U (12 CFR Part 221) or any other regulation of the Board or the Securities Exchange Act of 1934. If requested by any Bank, the Borrower will promptly furnish the Bank with a statement in conformity with the requirements of Federal Reserve Form F.R. U-1 referred to in said Regulation U. Section 7.09. RELATIONSHIP WITH INVESTMENT ADVISER. Warburg Pincus Asset Management, Credit Suisse Asset Management or ACM, or an Affiliate of any thereof, serves as the Investment Adviser for the Borrower. Section 7.10. RELATIONSHIP WITH CUSTODIAN. Either State Street Bank, CTC, BBH&Co, PFPC Trust or an entity referred to in Section 14.02(b) hereof serves as the Custodian for the Borrower. Section 7.11. INVESTMENT COMPANY STATUS. The Borrower is an investment management company (or a Portfolio thereof) duly and validly registered as such under the Investment Company Act and bound by the provisions thereof. Section 7.12. AFFILIATED PERSONS. To the best of the Borrower's knowledge, the Borrower is not an "Affiliated Person" (as defined in the Investment Company Act) of the Operations Agent or any Bank. Section 7.13. ERISA. The Borrower has met the minimum funding requirements of ERISA with respect to any employee benefit plans subject to ERISA. No event has occurred resulting from the Borrower's failure to comply with ERISA that is reasonably likely to result in Borrower's incurring any liability that could have a Material Adverse Effect. Section 7.14. TAXES. The Borrower has filed all material tax returns required to be filed, and has paid, or has made adequate provision for the payment of, all taxes reflected therein. Section 7.15. GOOD TITLE TO PROPERTIES. The Borrower has good and marketable title to its properties and assets, subject to no Liens of any kind, except such as are permitted under Section 9.03 hereof. Section 7.16. SUBSIDIARIES. The Borrower has no Subsidiaries. Section 7.17. NO DEFAULT. No Default under this Agreement has occurred and is continuing. Section 7.18. YEAR 2000 COMPLIANCE. The Borrower is taking steps (a) believed by it in good faith to be reasonably designed to address the risk that critical computer systems and equipment containing embedded microchips that it uses relating to its operations may be unable to process properly and calculate date-related information and data from and after January 1, 2000 (the "YEAR 2000 PROBLEM"), and (b) to obtain assurances deemed reasonable by the Borrower that its material service providers (in each case, excluding the Banks and the Operations Agent) are taking reasonable steps to address the Year 2000 Problem. The Borrower will deliver to the Operations Agent at the date of the delivery of this Agreement in accordance with Section 6.01 its current Year 2000 Readiness Disclosure issued pursuant to the Year 2000 Information and Readiness Disclosure Act of 1998 (Pub.Law 105-271), and, thereafter, until the -28- Expiration Date, will deliver promptly to the Operations Agent each materially revised copy of such statement. The Borrower reasonably expects that the effects of the Year 2000 Problem should not result in an Event of Default with respect to the Borrower or in a material adverse effect on its business, assets, operations, prospects or condition (financial or otherwise). In addition, the Borrower agrees to notify the Operations Agent promptly if it has reason to believe that either an Event of Default with respect to the Borrower or a material adverse effect on its business, assets, operations, prospects or condition (financial or otherwise) is likely to result from a Year 2000 Problem with respect to the Borrower or its material service providers (in each case, excluding the Banks and the Operations Agent). Section 7.19. FULL DISCLOSURE. Neither the Schedules nor Exhibits hereto, nor any certificate, statement, report or other document furnished to the Operations Agent or the Banks by or on behalf of the Borrower in connection herewith or in connection with any transaction contemplated hereby, nor this Agreement nor any other Loan Document contains, at the time furnished, when taken as a whole, any untrue statement of a material fact or omits to state any material fact necessary in order to make the statements contained therein not misleading. ARTICLE VIII. AFFIRMATIVE COVENANTS Each Borrower agrees that, so long as any amounts are owing with respect to Loans or otherwise pursuant to this Agreement or, if no such amount is owing, so long as the Commitments shall be in effect with respect to the Borrower; PROVIDED that, where appropriate, the reference herein to "the Borrower" shall be deemed to be a reference to the Investment Company of which such Borrower is a Portfolio: Section 8.01. FINANCIAL STATEMENTS; ETC. The Borrower will furnish or cause to be furnished to the Operations Agent (with sufficient copies for itself and the other Banks): (a) As soon as available and in any event within ninety (90) days after the end of each fiscal year of the Borrower, a statement of assets and liabilities (or statement of net assets, as applicable) of the Borrower as at the end of such fiscal year, a statement of operations for such fiscal year, a statement of changes in net assets for such fiscal year and the preceding fiscal year, a portfolio of investments as at the end of such fiscal year and the per share and other data for such fiscal year prepared in accordance with regulatory requirements, and all reported on in a manner acceptable to the SEC by independent certified public accountants of recognized standing. Such financial statements shall in each instance be accompanied by a statement signed by the President, Treasurer or Assistant Treasurer of the Borrower to the effect that he(she) has no knowledge of any existing Default with respect to such Borrower, or if he(she) has such knowledge, specifying such event or condition and its period of existence and what action such Borrower has taken or proposes to take with respect thereto; (b) As soon as available and in any event within sixty (60) days after the close of the first six-month period of each fiscal year of the Borrower, a statement of assets and liabilities (or statement of net assets, as applicable) as at the end of such six-month period, a statement of operations for such six-month period, a statement of changes in net assets for such six-month period and a portfolio of investments as at the end of such six-month period, all prepared in accordance with regulatory requirements and all certified (subject to normal year end -29- adjustments) as to fairness of presentation, GAAP and consistency by the President, Treasurer or Assistant Treasurer of the Borrower. Such financial statements shall in each instance also be accompanied by a statement signed by such officer to the effect that he(she) has no knowledge of any existing Default with respect to the Borrower, or if he(she) has such knowledge, specifying such event or condition and its period of existence and what action the Borrower has taken or proposes to take with respect thereto; (c) The Borrower's annual report to shareholders and Prospectus, when given to the Borrower's Shareholders; and (d) At the time of any request for a Loan hereunder, a Borrowing Request from such Borrower in the form of EXHIBIT A or B annexed hereto, as appropriate, setting forth the information required thereunder as of the close of business on the previous business day of such Borrower. In addition, on any Banking Day thereafter when any Loans are outstanding to the Borrower, each Bank shall have the right to request by 12:00 noon (Boston time) a report in the form of EXHIBIT E hereof (a "DAILY VALUATION REPORT") setting forth the value of the Borrower's portfolio securities and the value of the Borrower's Total Assets and Net Assets as of the close of business on the previous business day of the Borrower, which report shall be provided by the Borrower to a requesting Bank as soon as available and in any event not later than 2:00 p.m. (Boston time) on the date such request is made. (e) Upon the occurrence of a Default hereunder, prompt written notice thereof. The Borrower will also furnish or cause to be furnished to the Operations Agent and each Bank such other information regarding the business, affairs and condition of the Borrower as the Operations Agent and the Banks may from time to time reasonably request. The Borrower will permit the Operations Agent and any Bank to inspect the books and any of the properties or assets of the Borrower at such reasonable times and, except if a Default has occurred and is continuing, upon reasonable prior notice, as the Operations Agent or such Bank may from time to time request. The Operations Agent and the Banks agree to provide to each Borrower's independent public accountants such verifications of the Commitments, the Loans and related matters as the accountants shall reasonably request in connection with the audit of the Borrower. Section 8.02. Legal Existence; Compliance with Laws; Etc. The Borrower will: (a) maintain its legal existence and business, PROVIDED, HOWEVER, that nothing contained in this Section 8.02 shall prohibit the merger or consolidation of the Borrower with or into another Person upon written notice thereof to the Banks, subject to the provisions of Section 14.02 hereof and the additional requirement that the surviving entity (if not previously a Borrower) be admitted as such in accordance with Article XIII hereof, and FURTHER PROVIDED that the surviving entity assumes all of the obligations of the Borrower under this Agreement, including, without limitation, the obligations of the Borrower with respect to any Loans outstanding to the Borrower at the time of such merger or consolidation; (b) maintain all properties which are reasonably necessary for the conduct of its business, now or hereafter owned, in good repair, working order and condition; -30- (c) take all actions necessary to maintain and keep in full force and effect its rights and franchises, except where the failure to do so is not reasonably likely to result in a Material Adverse Effect; (d) comply in all material respects with all of its investment policies and restrictions; (e) comply in all respects with the provisions of its Prospectus, its charter, articles of association, declaration of trust and bylaws, as applicable, and all agreements and instruments by which it or any of its property or assets may be affected or bound, except where the failure to do so is not reasonably likely to result in a Material Adverse Effect; (f) comply with the minimum funding requirements of ERISA with respect to any employee benefit plans subject to ERISA; and (g) except where the failure to do so is not reasonably likely to result in a Material Adverse Effect, comply with all applicable statutes, rules, regulations and orders of, and all applicable restrictions imposed by, all governmental authorities in respect of the conduct of its business and the ownership of its properties, including, but not limited to the Investment Company Act; PROVIDED that the Borrower shall not be required by reason of this section to comply therewith at any time while the Borrower shall be contesting its obligations to do so in good faith by appropriate proceedings promptly initiated and diligently conducted, and if it shall have set aside on its books such reserves, if any, with respect thereto as are required by GAAP and deemed adequate by the Borrower and its independent public accountants. Section 8.03. FURTHER ASSURANCES. From time to time hereafter, the Borrower will execute and deliver, or will cause to be executed and delivered, such additional instruments, certificates or documents, and will take all such actions, as the Operations Agent or any Bank may reasonably request, for the purposes of implementing or effectuating the provisions of this Agreement. Upon the exercise by the Operations Agent or any Bank of any power, right, privilege or remedy pursuant to this Agreement which requires any consent, approval, registration, qualification or authorization of any governmental authority or instrumentality, the Borrower will execute and deliver, or will cause the execution and delivery of, all applications, certifications, instruments and other documents and papers that the Operations Agent or such Bank may be required to obtain for such governmental consent, approval, registration, qualification or authorization. Section 8.04. INVESTMENT COMPANY STATUS. The Borrower will maintain its status as an Investment Company or a Portfolio of an Investment Company registered under the Investment Company Act. Section 8.05. USE OF PROCEEDS. The Borrower will use the proceeds of Loans only for the purposes specified in Section 4.08. Section 8.06. INSURANCE. The Borrower will maintain or cause to be maintained with financially sound and reputable insurance companies, policies with respect to its properties and business against at least such risks (and with no greater risk retentions) and in at least such amounts as are customary in the case of registered investment management companies engaged -31- in similar securities activities of comparable size and financial strength, and will furnish to the Banks and the Operations Agent, upon request, information presented in reasonable detail as to the insurance so carried. ARTICLE IX. NEGATIVE COVENANTS Each Borrower agrees that, so long as any amounts are owing with respect to Loans or otherwise pursuant to this Agreement or, if no such amount is owing, so long as the Commitments shall be in effect with respect to the Borrower: Section 9.01. Asset Coverage. (a) The Borrower will not borrow amounts in excess of the lowest of (i) the percentage of the Borrower's Net Assets or Total Assets, as the case may be, constituting the borrowing limit, as set forth in the Borrower's Prospectus, as the same may be amended and in effect from time to time (it being specifically acknowledged that, as of the date of this Agreement, permitted indebtedness for each of Warburg Pincus Emerging Growth Fund, Inc., Warburg Pincus International Equity Fund, Inc., and Warburg Pincus Capital Appreciation Fund is limited to 10% of their respective Net Assets), or as may be set forth in a vote adopted by the Shareholders of the Borrower, (ii) the amount permitted to be borrowed by the Borrower under the Investment Company Act, and (iii) the percentage of the Borrower's Net Assets or Total Assets, as the case may be, specified as the borrowing limit for the Borrower in any agreement binding upon the Borrower or its assets with any foreign, federal, state, or local securities division to which the Borrower is subject. (b) The aggregate Indebtedness of the Borrower in respect of Loans shall at no time exceed (i) 33-1/3% of the Borrower's Net Assets, in the case of any Borrower that is a Domestic Fund, (ii) 25% of the Borrower's Net Assets, in the case of Warburg Pincus High Yield Fund, Inc., Warburg Pincus Post Venture Capital Fund, Inc., Warburg Pincus Global Post Venture Capital Fund, Inc., Warburg Pincus Post Venture Capital Portfolio of Warburg Pincus Trust, and Post Venture Capital Portfolio of Warburg Pincus Institutional Fund, Inc., and any Borrower that is an International Fund, or (iii) 20% of the Borrower's Net Assets, in the case of any Borrower that is a Restricted Fund. The lesser of the amounts determined with respect to the Borrower pursuant to paragraphs (a) and (b) of this Section 9.01 is sometimes referred to herein as the Borrower's Borrowing Base. Section 9.02. INDEBTEDNESS. The Borrower will not, directly or indirectly, incur or permit to exist or remain outstanding any Indebtedness to any Person, nor will the Borrower issue any preferred stock or other "senior security" (as defined in the Investment Company Act) to any Person; PROVIDED, HOWEVER, that the Borrower may incur or permit to exist or remain outstanding: (a) Indebtedness of the Borrower to the Banks arising under this Agreement or the other Loan Documents; -32- (b) Indebtedness in respect of taxes, assessments and other governmental charges to the extent that payment thereof shall not at the time be required to be made in accordance with the provisions of Section 9.03(b) hereof; (c) Indebtedness in respect of Financial Contracts arising in the ordinary course of business, but only to the extent that such Indebtedness is (i) permitted by the provisions of the Borrower's Prospectus, and (ii) reflected in the calculation of the Borrower's Net Assets; and (d) Indebtedness of the Borrower to its Custodian in respect of overdrafts incurred in the ordinary course of business. Section 9.03. MORTGAGES; LIENS; ETC. The Borrower will not, directly or indirectly, create, incur, assume or suffer to exist, any mortgage, lien, charge or encumbrance on, or security interest in, or pledge of, or conditional sale or other title retention agreement (collectively, "LIENS") on any of the securities or other assets owned by the Borrower except: (a) Liens arising in the ordinary course of the Borrower's business out of or in connection with Financial Contracts, but only to the extent that the same are permitted by the provisions of the Borrower's Prospectus; (b) Liens for taxes not yet delinquent or that are being contested in good faith; Liens in connection with workmen's compensation, unemployment insurance or other social security obligations; and other Liens or encumbrances incidental to the conduct of the business of the Borrower or to the ownership of its properties or assets, which were not incurred in connection with the borrowing of money or the obtaining of credit and which do not materially detract from the value of the properties or assets of the Borrower or materially affect the use thereof in the operation of its business; (c) Judgment liens in the aggregate at any time outstanding for an amount not in excess of five percent (5%) of the Borrower's Total Assets (exclusive of amounts covered by available insurance), provided that each such Lien is discharged or the execution thereof is stayed pending appeal within thirty (30) days after the attachment of such Lien or such Lien is discharged within thirty (30) days after the expiration of any such stay; (d) Liens granted to the Custodian of the Borrower's securities pursuant to the custodianship agreement between the Custodian and the Borrower solely as security for the Borrower's obligations to the Custodian under such agreement, as in effect from time to time. Section 9.04. CHANGE OF INVESTMENT OBJECTIVES, ETC. The Borrower will not amend or otherwise modify its investment objectives or its fundamental investment policies or limits or restrictions thereon as in effect on the date of this Agreement without the prior written consent of the Banks and the Operations Agent, which consent shall not be unreasonably withheld. ARTICLE X. DEFAULTS; REMEDIES Section 10.01. EVENTS OF DEFAULT; ACCELERATION. If any of the following events (each an "EVENT OF DEFAULT") shall occur with respect to any Borrower: -33- (a) Such Borrower (i) shall default in the payment of principal of any Loan, interest accrued thereon or fee due hereunder after the same becomes due and payable, whether at maturity or by acceleration or otherwise, or (ii) shall default in the payment of any other amount due hereunder after the same becomes due and payable; or (b) Such Borrower shall default in the performance of or compliance with any term contained in Sections 9.01(a) or 9.01(b) and such default shall have continued for more than three (3) Banking Days, or such Borrower shall default in the performance of or compliance with any term contained in Sections 8.02(d), 8.02(e), 8.02(g), 8.05, 9.02, 9.03 or 9.04; or (c) Such Borrower shall default in the performance of or compliance with any term contained herein other than those expressly referred to in this Section 10.01, and such default shall not have been remedied within five (5) Banking Days after written notice thereof shall have been given to such Borrower by the Operations Agent; or (d) Such Borrower shall default in the performance of, or compliance with, any material term contained in any other written agreement with the Operations Agent or any Bank pertaining to this Agreement or such Borrower's Loans, and such default shall continue for more than the period of grace, if any, specified therein and shall not have been waived pursuant thereto; or (e) Any representation, warranty certification or statement made or deemed made by such Borrower in this Agreement or in any certificate, financial statement or other document delivered pursuant hereto shall prove to have been false or incorrect in any material respect when made; or (f) Except as otherwise provided in this Section 10.01, such Borrower shall default in any payment due on Indebtedness for borrowed money or the deferred purchase price of property, the aggregate outstanding principal amount of which is in excess of five percent (5%) of such Borrower's Total Assets, and such default shall continue for more than the period of grace, if any, applicable thereto and shall not have been waived pursuant thereto and shall permit the holder of such Indebtedness to declare such Indebtedness due and payable before its stated maturity, or in the performance of or compliance with any term of any evidence of such Indebtedness or of any mortgage, indenture or other agreement relating thereto, and any such default shall continue for more than the period of grace, if any, specified therein and shall not have been waived pursuant thereto and shall permit the holder of such Indebtedness to declare such Indebtedness due and payable before its stated maturity, unless such Borrower shall be contesting such payment or obligation in good faith by appropriate proceedings promptly initiated and diligently conducted and such Borrower shall have set aside on its books such reserves, if any, with respect thereto as are required by GAAP and deemed appropriate by such Borrower and its independent public accountants, PROVIDED, that no Event of Default pursuant to paragraphs (b) or (i) of this Section 10.01 shall have occurred and be continuing as a result of such claim having been asserted in respect of such Indebtedness; or (g) Such Borrower shall discontinue its business (other than in connection with a permitted merger or consolidation of such Borrower) or shall make an assignment for the benefit of creditors, or shall fail generally to pay its debts as such debts become due, or shall -34- apply for or consent to the appointment of or taking possession by a trustee, receiver or liquidator (or other similar official) of such Borrower or any substantial part of the property or assets of such Borrower or shall commence a case or have an order for relief entered against it under the federal bankruptcy laws, as now or hereafter constituted, or any other applicable federal or state bankruptcy, insolvency or other similar law, or if any action shall be taken to dissolve or liquidate such Borrower (other than in connection with a permitted merger or consolidation of such Borrower); or (h) If, within sixty (60) days after the commencement against such Borrower of a case under the federal bankruptcy laws, as now or hereafter constituted, or any other applicable federal or state bankruptcy, insolvency or other similar law, such case shall have been consented to or shall not have been dismissed or all orders or proceedings thereunder affecting the operations or the business of such Borrower stayed, or if the stay of any such order or proceeding shall thereafter be set aside, or if within sixty (60) days after the entry of a decree appointing a trustee, receiver or liquidator (or other similar official) of such Borrower or any substantial part of the property of such Borrower such appointment shall not have been vacated; or (i) A final judgment which, together with other outstanding final judgments against such Borrower, exceeds an amount in the aggregate equal to five percent (5%) of such Borrower's Total Assets (exclusive of amounts covered by available insurance) shall be rendered against such Borrower and if, within thirty (30) days after entry thereof, such judgment shall not have been discharged or execution thereof stayed pending appeal, or if, within thirty (30) days after the expiration of any such stay, such judgment shall not have been discharged; or (j) Such Borrower or any member of the Controlled Group shall fail to pay when due an amount or amounts aggregating in excess of $500,000 which it is obligated to pay to the PBGC or to a Plan under Title IV of ERISA; or a notice of intent to terminate a Plan or Plans having aggregate Unfunded Liabilities in excess of $500,000 shall be filed under Title IV of ERISA by such Borrower or any member of the Controlled Group, any plan administrator or any combination of the foregoing; or the PBGC shall institute proceedings under Title IV of ERISA to terminate or to cause a trustee to be appointed to administer any such Plan or Plans or a proceeding shall be instituted by a fiduciary of any such Plan or Plans against such Borrower or any member of the Controlled Group to enforce Sections 515 or 4219(c)(5) of ERISA; or a condition shall exist by reason of which the PBGC would be entitled to obtain a decree adjudicating that any such Plan or Plans must be terminated; or there shall occur a complete or partial withdrawal from, or a default, within the meaning of Section 4219(c)(5) of ERISA, with respect to, one or more Multiemployer Plans which could cause such Borrower or one or more members of the Controlled Group to incur a current payment obligation in excess of $500,000; or (k) Such Borrower shall cease to be an investment management company (or a Portfolio thereof) registered under the Investment Company Act, or such Borrower's registration under the Investment Company Act, or that of any Borrower Agent of such Borrower, shall lapse or be suspended; then, and in any such event, and at any time thereafter, if any Event of Default shall then be continuing with respect to such defaulting Borrower, (i) in the case of any Event of Default -35- specified in paragraphs (g) and (h) above, the Commitments as to such defaulting Borrower shall thereupon automatically be terminated and the principal of and accrued interest on the Loans shall automatically become due and payable without presentment, demand, protest or other notice or formality of any kind, all of which are hereby expressly waived, and (ii) in the case of any other Event of Default specified above, either or both of the following actions may be taken: the Operations Agent may, and upon the written or telephonic (confirmed in writing) request of the Majority Banks shall, by written notice to such defaulting Borrower (A) declare the principal of and accrued interest in respect of such defaulting Borrower's Loans to be forthwith due and payable, whereupon the principal of and accrued interest in respect of such Loans shall become forthwith due and payable without presentment, demand, protest or other notice of any kind, all of which are hereby expressly waived by such Borrower, and/or (B) terminate the Commitments as to such defaulting Borrower, whereupon the Commitments of the Banks to make Committed Credit Loans hereunder to such defaulting Borrower shall forthwith terminate without any other notice of any kind and the percentages of the Commitment Fee and other fees and expenses otherwise payable by such defaulting Borrower hereunder accruing from and after the date of termination shall be reallocated among the remaining Borrowers PRO RATA on the basis of the percentages set forth opposite such remaining Borrowers' names on SCHEDULE 1, as in effect at the time of such termination. Section 10.02. REMEDIES ON DEFAULT; ETC. In case any one or more Events of Default shall occur and be continuing with respect to a Borrower, the Operations Agent and each Bank (acting in accordance with the determination of the Majority Banks) may proceed in respect of such Borrower only to protect and enforce their respective rights by an action at law, suit in equity or other appropriate proceeding, whether for the specific performance of any agreement contained herein, or for an injunction against a violation of any of the terms hereof, or in aid of the exercise of any power granted hereby or by law. In case of a default by a Borrower in the payment of any principal of or interest on any Loan, or in the payment of any fee due hereunder, such Borrower will pay to the Operations Agent and the Banks such further amount as shall be sufficient to cover the cost and expense of collection, including, without limitation, reasonable attorneys' fees, expenses and disbursements solely to the extent related to the expense of collection of the principal of and interest on the Loans, and fees payable by, such Borrower and not of any other Borrower. No course of dealing and no delay on the part of the Operations Agent or any Bank in exercising any right shall operate as a waiver thereof or otherwise prejudice the Operations Agent's or the Bank's rights. No right conferred hereby upon the Operations Agent or any Bank shall be exclusive of any other right referred to herein or now or hereafter available at law, in equity, by statute or otherwise. ARTICLE XI. SETOFFS; ETC. Each Borrower hereby agrees that upon the occurrence of an Event of Default hereunder with respect to such Borrower, such Event of Default not having been previously remedied or cured, any Indebtedness from the Operations Agent or any Bank to such Borrower may be offset and applied toward the payment of any Indebtedness from such Borrower to the Operations Agent or such Bank, whether or not such Indebtedness, or any part thereof shall then be due. In addition to the obligations of the Banks under Section 4.11 hereof, each Bank agrees with each other Bank that if an amount to be setoff is to be applied to Indebtedness of a Borrower to such Bank other than Indebtedness to such Bank evidenced by this Agreement, such setoff amount -36- shall be applied ratably to such other Indebtedness and to the Indebtedness evidenced by this Agreement; PROVIDED that the agreement to apportion such setoff amounts shall not apply to fees and other Indebtedness arising under or in respect of any custodian agreement between a Bank and a Borrower. ARTICLE XII. THE OPERATIONS AGENT AND RELATIONS AMONG THE BANKS Section 12.01. APPOINTMENT OF OPERATIONS AGENT; POWERS AND IMMUNITIES. Each Bank hereby irrevocably appoints and authorizes the Operations Agent to act as its agent hereunder with such powers as are expressly delegated to the Operations Agent by the terms of this Agreement, together with such other powers as are reasonably incidental thereto. The Operations Agent shall not have any duties or responsibilities or any fiduciary relationship with any Bank except those expressly set forth in this Agreement. Neither the Operations Agent nor any of its Affiliates shall be responsible to the Banks for any recitals, statements, representations or warranties made by any Borrower or any other Person whether contained in this Agreement or otherwise or for the value, validity, effectiveness, genuineness, enforceability or sufficiency of this Agreement or any other document referred to or provided for herein or for any failure by any Borrower or any other Person to perform its obligations hereunder or thereunder. The Operations Agent may employ agents and attorneys-in-fact selected by it with reasonable care. Neither the Operations Agent nor any of its directors, officers, employees or agents shall be responsible for any action taken or omitted to be taken by it or them hereunder or in connection herewith, except for its or their own gross negligence or willful misconduct. The Operations Agent in its separate capacity as a Bank shall have the same rights and powers hereunder as any other Bank. Section 12.02. RELIANCE BY OPERATIONS AGENT. The Operations Agent shall be entitled to rely upon any certificate, notice or other document (including any facsimile thereof) believed by it to be genuine and correct and to have been signed or sent by or on behalf of the proper Person or Persons, and upon advice and statements of legal advisers, independent accountants and other experts selected by the Operations Agent. As to any matters not expressly provided for in this Agreement or in any other document referred to herein, the Operations Agent shall in all cases be fully protected in acting, or in refraining from acting, in accordance with the written instructions of the Majority Banks, and such instructions of the Majority Banks and any action taken or failure to act pursuant thereto shall be binding on all of the Banks. Section 12.03. INDEMNIFICATION. Without limiting the obligations of the Borrowers hereunder, including under Sections 2.04(c), 3.03(c) and 15.12, the Banks agree to indemnify the Operations Agent, ratably in accordance with their Facility Percentages, for any and all liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements of any kind or nature whatsoever which may at any time (including, without limitation, at any time following the termination of the Commitments) be imposed on, incurred by or asserted against the Operations Agent in any way relating to or arising out of this Agreement or any documents contemplated by or referred to herein or therein or the transactions contemplated hereby or thereby or the enforcement of any of the terms hereof or thereof or of any such other documents; PROVIDED that no Bank shall be liable for any of the foregoing if they arise solely from the Operations Agent's gross negligence or willful misconduct. -37- Section 12.04. DOCUMENTS. Without in any way limiting the obligation of the Borrowers to provide documents directly to each Bank hereunder, the Operations Agent will forward to each Bank, promptly after the Operations Agent's receipt thereof, a copy of each document furnished to the Operations Agent for such Bank hereunder. Section 12.05. NON-RELIANCE ON OPERATIONS AGENT AND OTHER BANKS. Each Bank represents that it has, independently and without reliance on the Operations Agent or any other Bank, and based upon such documents and information as it has deemed appropriate, made its own appraisal of the financial condition and affairs of the Borrowers and decision to enter into this Agreement and agrees that it will, independently and without reliance upon the Operations Agent or any other Bank, and based upon such documents and information as it shall deem appropriate at the time, continue to make its own appraisals and decisions in taking or not taking action under this Agreement. The Operations Agent shall not be required to keep informed as to the performance or observance by any Borrower of this Agreement or any other document referred to or provided for herein or to make inquiry of, or to inspect the properties or books of any Person. Except for notices, reports and other documents and information expressly required to be furnished to the Banks by the Operations Agent hereunder, the Operations Agent shall not have any duty or responsibility to provide any Bank with any credit or other information concerning any Person which may come into the possession of the Operations Agent or any of its Affiliates. Each Bank shall have access to all documents relating to the Operations Agent's performance of its duties hereunder, at such Bank's request. Unless any Bank shall promptly object to any action taken by the Operations Agent hereunder, such Bank shall conclusively be presumed to have approved the same. Section 12.06. RESIGNATION OR REMOVAL OF OPERATIONS AGENT. The Operations Agent may resign at any time by giving sixty (60) days' prior written notice thereof to the Banks and the Borrowers. Upon any such resignation, the Majority Banks shall have the right to appoint a successor Operations Agent with the approval of the Borrowers (which approval shall not be unreasonably withheld or delayed). If no successor Operations Agent shall have been so appointed by the Majority Banks and shall have accepted such appointment within thirty (30) days after the retiring Operations Agent's giving of notice of resignation, then the Borrowers may appoint a successor Operations Agent, which shall be a commercial banking institution organized or licensed under the laws of the United States of America or any state thereof, and having a combined capital and surplus of at least $100,000,000. Upon the acceptance of any appointment as Operations Agent hereunder by a successor Operations Agent, such successor Operations Agent shall thereupon succeed to and become vested with all the rights, powers, privileges and duties of the retiring Operations Agent, and the retiring Operations Agent shall be discharged from its duties and obligations hereunder. After any retiring Operations Agent's resignation, the provisions of this Article XII shall continue in effect for its benefit in respect of any actions taken or omitted to be taken by it while it was acting as Operations Agent. In the event of a material breach of its duties hereunder, the Operations Agent may be removed by the Majority Banks for cause and the provisions of this Section 12.06 shall apply to the appointment of a successor. Section 12.07. DELINQUENT BANKS. Notwithstanding anything to the contrary contained in this Agreement or any of the other Loan Documents, any Bank that fails (i) to make available to the Operations Agent its PRO RATA share of any Loan, or (ii) to comply with the provisions of -38- Section 4.11 or Article XI hereof with respect to making dispositions and arrangements with the other Banks, where such Bank's share of any payment received, whether by setoff or otherwise, is in excess of its PRO RATA share of such payments due and payable to all of the Banks, in each case as, when and to the full extent required by the provisions of this Agreement, shall be deemed delinquent (a "DELINQUENT BANK"), and shall be deemed a Delinquent Bank until such time as such delinquency is satisfied. A Delinquent Bank shall be deemed to have assigned any and all payments due to it from a Borrower, whether on account of outstanding Loans, interest, fees or otherwise, to the remaining nondelinquent Banks for application to, and reduction of, their respective PRO RATA shares of all outstanding Loans to such Borrower. The Delinquent Bank hereby authorizes the Operations Agent to distribute such payments to the nondelinquent Banks in proportion to their respective PRO RATA shares of all outstanding Loans to such Borrower. A Delinquent Bank shall be deemed to have satisfied in full a delinquency when and if, as a result of application of the assigned payments to all outstanding Loans of the nondelinquent Banks, the Banks' respective PRO RATA shares of all outstanding Loans to such Borrower have returned to those in effect immediately prior to such delinquency and without giving effect to the nonpayment causing such delinquency. ARTICLE XIII. ADDITIONAL BORROWERS Other Investment Companies (or Portfolios of Investment Companies), in addition to those Borrowers listed on SCHEDULE 1, may, with the written approval of the Operations Agent and the Banks, become parties to this Agreement and be deemed Borrowers for all purposes of this Agreement by executing an instrument substantially in the form of EXHIBIT F hereto (with such changes therein as may be approved by the Operations Agent and the Banks), which instrument shall (i) have attached to it a copy of this Agreement (as the same may have been amended) with a revised SCHEDULE 1 reflecting the participation of such additional Investment Company (or Portfolio of an Investment Company) and any prior revisions to SCHEDULE 1 effected in accordance with the terms hereof and (ii) be accompanied by the documents and instruments required to be delivered by such additional Borrower pursuant to Section 6.01 hereof, including, without limitation, an opinion of counsel for such additional Borrower, in the form of EXHIBIT G, satisfactory to the Operations Agent and the Banks. No Investment Company (or Portfolio of an Investment Company) shall be admitted as a party to this Agreement as a Borrower unless at the time of such admission and after giving effect thereto: (i) the representations and warranties set forth in Article VII hereof shall be true and correct with respect to such additional Borrower; (ii) such additional Borrower shall be in compliance in all material respects with all of the terms and provisions set forth herein on its part to be observed or performed at the time of the admission and after giving effect thereto; and (iii) no Default with respect to such additional Borrower shall have occurred and be continuing. Notwithstanding the foregoing, the Operations Agent and the Banks shall be required to consider such requests for admission no more frequently than once in any calendar quarter. ARTICLE XIV. TERM AND TERMINATION Section 14.01. TERM AND TERMINATION OF AGREEMENT. This Agreement and the Commitments shall continue for an initial term of 364 days from the date of this Agreement, -39- unless terminated earlier in accordance herewith, and may, at the discretion of the Banks, be renewed for successive terms of 364 days as hereinafter provided. The Operations Agent, on behalf of the Banks, shall notify the Borrower Agents in writing not less than forty-five (45) days prior to the expiration of any such term (an "EXPIRATION DATE") whether or not all of the Banks are willing to renew the Commitments hereunder, and, if not, shall provide a list of the Banks which are willing to renew their respective Commitments hereunder and the amount of such Commitments (each a "RENEWAL NOTICE"). In the event that all, or any portion, of the Banks are willing to renew their respective Commitments hereunder, then with the concurrence of the Borrowers, this Agreement and the Commitments so renewed shall continue for an additional term of 364 days, unless terminated earlier in accordance herewith, with such modifications hereto as may be required to evidence any change in the actual amount of Commitments being renewed. If the Operations Agent does not furnish a Renewal Notice to the Borrower Agents at least 45 days prior to any Expiration Date as aforesaid, the Commitments and the Banks' obligations to make Loans hereunder shall terminate on such Expiration Date and this Agreement shall terminate and be of no further force and effect except for (i) the obligations of the Borrowers to pay any and all of their obligations incurred hereunder or in respect hereof (including the payment of the entire unpaid principal of and accrued interest on the Loans and the payment in full of all fees and expenses provided for herein), (ii) the indemnification obligations of the Borrowers hereunder with respect to Loans made by, or other actions taken by, the Banks or the Operations Agent to, or in respect of, the Borrowers prior to the Expiration Date, and (iii) the rights of the Borrowers pursuant to Section 5.01(c) hereof to be reimbursed costs, if any, recovered by the Banks. Section 14.02. TERMINATION AS TO A BORROWER. Each Borrower, acting through its Borrower Agent, shall give the Operations Agent not less than thirty (30) days' prior written notice (with sufficient copies for itself and the other Banks) of the occurrence of any of the following events, which notice shall specify the nature of the event in question, unless such Borrower shall not have known more than thirty (30) days in advance that such event was to occur, in which case the Borrower Agent shall give the Operations Agent written notice of such event (with sufficient copies for itself and the other Banks) promptly after such Borrower first obtains knowledge of its occurrence: (a) A change by such Borrower which results in Warburg Pincus Asset Management, Credit Suisse Asset Management, ACM or an Affiliate of any thereof not being retained as Investment Adviser; (b) A change by such Borrower which results in State Street Bank, PFPC Trust, BBH&Co or CTC, as applicable, not being retained as Custodian, unless (i) the new Custodian shall be a bank or trust company organized under the laws of the United States of America having assets of at least $10 billion and a long-term debt rating of not less than "A" or its equivalent from a recognized rating agency and (ii) such Borrower shall have given the Operations Agent prior written notice of such change; (c) The termination or deemed termination of any investment advisory agreement with Warburg Pincus Asset Management, Credit Suisse Asset Management or an Affiliate of either thereof which is in effect with respect to such Borrower on the date of this Agreement; -40- (d) Any material change in the ownership or management of such Borrower's Investment Adviser after the date of this Agreement, excluding any change resulting from the proposed sale of Warburg Pincus to Credit Suisse; (e) A merger or consolidation of such Borrower if such merger or consolidation is not permitted under Section 8.02(a) hereof, or if the conditions specified in paragraphs (b) and (c) of Section 6.02 hereof are not satisfied by the successor entity immediately following such merger or consolidation, or if such merger or consolidation results in a change or occurrence specified in paragraph (a), (b) or (c) above, PROVIDED, HOWEVER, that, in any event, the non-surviving entity in such merger or consolidation shall not continue to be a Borrower under or a party to this Agreement following such merger or consolidation; (f) A merger or consolidation of such Borrower if such merger or consolidation results in one or more of the changes or occurrences specified in paragraph (g) below, PROVIDED, HOWEVER, that, in any event, the non-surviving entity in such merger or consolidation shall not continue to be a Borrower under or a party to this Agreement following such merger or consolidation; (g) The occurrence of any of the following: (1) such Borrower, if an open-end Investment Company (or Portfolio thereof), becoming a closed-end Investment Company; (2) such Borrower, or the Investment Company of which such Borrower is a Portfolio, changing the independent public accountants responsible for auditing its books and records and certifying its financial statements to a Person other than an independent public accounting firm of recognized standing; or (3) a majority of the members of the Board of Trustees or the Board of Directors, as applicable, of such Borrower (or, as applicable, of the Investment Company of which such Borrower is a Portfolio) resigning or being removed within a period of thirty (30) days and being replaced with Persons other than Persons who are then or will be contemporaneously therewith members of the Board of Trustees or Board of Directors of another Investment Company of which Warburg Pincus Asset Management, Credit Suisse Asset Management or an Affiliate of either is serving as Investment Adviser; and shall provide the Operations Agent and each Bank with such information as the Operations Agent or the Banks may reasonably request regarding the pending event. Any notice furnished to the Operations Agent pursuant to this Section 14.02 may, at the option of the Borrower furnishing such notice, be accompanied by a request that the Operations Agent acknowledge in writing that the events specified in such notice shall not constitute an event permitting termination of the Commitments with respect to such Borrower as hereinafter provided. -41- Upon the occurrence of any of the events specified in paragraphs (a), (b), (c), (d) or (e) above with respect to a Borrower, unless the Operations Agent shall have acknowledged in writing that such event shall not constitute an event permitting termination of the Commitments with respect to such Borrower as hereinafter provided, the Operations Agent may, and upon the written or telephonic (confirmed in writing) request of the Majority Banks shall, upon five (5) days' prior written notice from the Operations Agent to such Borrower terminate the Commitments with respect to such Borrower. Upon the occurrence of any of the events specified in paragraphs (f) or (g) above with respect to a Borrower, unless the Operations Agent shall have acknowledged in writing that such event shall not constitute an event permitting termination of the Commitments as hereinafter provided, the Operations Agent may, and upon the written or telephonic (confirmed in writing) request of the Majority Banks shall, upon five (5) days' prior written notice from the Operations Agent to such Borrower (but in no event later than the last to occur of the sixtieth day following the occurrence of the specified event and ninety (90) days' following receipt by the Operations Agent of written notice of the occurrence of such event) terminate the Commitments with respect to such Borrower. In the event of any such termination of the Commitments with respect to a Borrower as aforesaid, the Banks' obligations to make Committed Credit Loans to such Borrower hereunder shall terminate on the date specified in such notice, such Borrower shall cease to be a party to this Agreement and this Agreement shall be of no further force and effect as to such Borrower except for (i) the obligations of such Borrower to pay any and all of its obligations incurred hereunder or in respect hereof (including the payment of the entire unpaid principal of and accrued interest on the Loans and the payment in full of all fees and expenses provided for herein to be paid by such Borrower), (ii) the indemnification obligations of such Borrower hereunder with respect to Loans made by, or other actions taken by, the Banks or the Operations Agent to, or in respect of, such Borrower prior to the effective date of such termination, and (iii) the rights of such Borrower pursuant to Section 5.01(c) to be reimbursed costs, if any, recovered by the Banks. This Agreement (including the Commitments) shall otherwise remain in full force and effect as to all other Borrowers. Upon the termination of this Agreement with respect to a Borrower, the percentages of the Commitment Fee and other fees and expenses otherwise payable by such Borrower hereunder accruing from and after the date of termination shall be reallocated among the remaining Borrowers PRO RATA on the basis of the percentages set forth opposite such remaining Borrowers' names on SCHEDULE 1, as in effect at the time of such termination. ARTICLE XV. PROVISIONS OF GENERAL APPLICATION Section 15.01. EXPENSES. Whether or not the transactions contemplated hereby shall be consummated, the Borrowers agree to pay, PRO RATA in proportion to the Specified Percentages (except in the case of clause (iii) below with respect to which the defaulting Borrower(s) shall be liable for the expenses referred to therein), (i) all reasonable expenses (including reasonable fees and disbursements of counsel) which the Operations Agent has incurred or may hereafter incur in connection with the preparation of this Agreement and all other documents related hereto (including any amendment, consent or waiver hereafter requested by any Borrower hereunder or thereunder) and the transactions contemplated hereby, (ii) all reasonable expenses (including reasonable fees and disbursements of counsel) of the Operations Agent, the Swing Line Lender and the Banks incurred in connection with any formal credit restructuring or loan work-out, whether before or after Default, and (iii) all reasonable expenses (including reasonable fees and disbursements of counsel) which the Operations Agent, the Swing Line Lender and each Bank -42- may hereafter incur in connection with the enforcement of the rights of the Operations Agent, the Swing Line Lender or the Banks hereunder upon the occurrence of a Default. Section 15.02. Amendments and Waivers; Etc. (a) Except as otherwise expressly set forth herein, any term of this Agreement may be amended and the observance of any term of this Agreement may be waived (either generally or in a particular instance and either retroactively or prospectively) only with the written consent of each Borrower and the Majority Banks, PROVIDED, HOWEVER, that without the consent of each affected Bank, the Commitment of such Bank may not be increased, and FURTHER PROVIDED, HOWEVER, that without the consent of the Operations Agent, no amendment to Section 5.02 or to Article XII shall be effected, and still FURTHER PROVIDED that without the consent of the Swing Line Lender, no amendment to Article III or to Article IV (as it applies to Swing Line Loans), no compromise of the principal amount of, or change in the interest rate on, any Swing Line Loan or extension or postponement of the stated time of payment of the principal amount of, or interest on, any Swing Line Loan, shall be effected; and still FURTHER PROVIDED that without the written consent of such Banks as hold 100% of the aggregate outstanding principal amount of all Committed Credit Loans or, if no Committed Credit Loans are outstanding, of the Commitments, (i) no change to the definition of "Majority Banks" in Section 1.01 hereof shall be made; (i) no compromise of the principal amount of, or decrease in the interest rate on, any Committed Credit Loan shall be made; (ii) no decrease in the amount of Commitment Fees or other fees or expenses payable hereunder shall be made; (iii) no extension or postponement of the stated time of payment of the principal amount of, or interest on, any Committed Credit Loan, nor of any Commitment Fees or other fees or expenses payable hereunder, shall be made; (iv) no extension of the term of the Commitments beyond that provided for hereunder shall be made; (v) no Investment Company (or Portfolio of an Investment Company) other than the Borrowers shall be admitted as a Borrower hereunder; (vi) no change to the provisions of this Section 15.02(a) shall be made. Any amendment or waiver effected in accordance with this Section 15.02(a) shall be binding upon all parties to this Agreement, their respective successors and assigns. (b) The Operations Agent's, the Swing Line Lender's or any Bank's failure to insist upon the strict performance of any term, condition or other provision of this Agreement or to exercise any right or remedy hereunder shall not constitute a waiver by the Operations Agent, the Swing Line Lender or such Bank of any such term, condition or other provision or Default in -43- connection therewith; and any waiver of any such term, condition or other provision or of any such Default shall not affect or alter this Agreement, and each and every term, condition and other provision of this Agreement shall, in such event, continue in full force and effect and shall be operative with respect to any other then existing or subsequent Default in connection therewith. Section 15.03. NATURE OF OBLIGATIONS. The obligations of all Borrowers hereunder shall be several and not joint. Section 15.04. NOTICES. Except as otherwise provided herein, all notices, requests and other communications to any party hereunder or under any of the Loan Documents shall be in writing and shall be personally delivered or sent by certified mail, postage prepaid, return receipt requested, or by a reputable courier delivery service or by telecopy and shall be given, If to any Bank: At the address or addresses set forth on SCHEDULE 2 hereto If to the Swing Line Lender: State Street Bank and Trust Company Global Investor Credit Services Division Mutual Fund Lending Department Lafayette Corporate Center 2 Avenue de Lafayette, 2nd Floor Boston, MA 02111 Attention: Michelle Murphy Fax: (617) 662-2324 If to the Borrower Agents, the At the address or addresses set forth on Borrowers or any Borrower: SCHEDULE 1 hereto with copies to: Rose DiMartino, Esquire Willkie Farr & Gallagher 787 Seventh Avenue New York, NY 10019-6099 If to the Operations Agent: State Street Bank and Trust Company Global Investor Credit Services Division Mutual Fund Lending Department Lafayette Corporate Center 2 Avenue de Lafayette, 2nd Floor Boston, MA 02111 Attention: Michelle Murphy Fax: (617) 662-2324 -44- with copies to: Joel H. Peterson, Esquire Erickson Schaffer Peterson & Hempel PC 20 William Street, Suite 150 Wellesley, MA 02481 Fax: (617) 235-1571 or such other address or telecopy number as the party to whom such notice is directed may have designated in writing to the other parties hereto. Each such notice, request or other communication shall be effective (i) if given by telecopy, when such telecopy is transmitted to the telecopy number specified in this Section and the appropriate confirmation is received, (ii) if given by certified mail, 72 hours after such communication is deposited with the post office, addressed as aforesaid or (iii) if given by any other means (including, without limitation, by air courier), when delivered at the address specified in this Section. Section 15.05. CALCULATIONS; ETC. Except as otherwise provided herein, calculations hereunder shall be made and financial data required hereby shall be prepared, both as to classification of items and as to amounts, in accordance with GAAP, which principles shall be consistently applied and in conformity with those used in the preparation of the financial statements referred to herein. Section 15.06. SURVIVAL OF COVENANTS; ETC. All covenants, agreements, representations and warranties made herein or in any documents or other papers delivered by or on behalf of the Borrowers, or any of them, pursuant hereto shall be deemed to have been relied upon by the Operations Agent, the Swing Line Lender and the Banks, notwithstanding any investigation heretofore or hereafter made by them, and shall survive the execution and delivery of this Agreement and the making by the Banks and the Swing Line Lender of the Loans as herein contemplated, and shall continue in full force and effect so long as any amount due under this Agreement remains outstanding and unpaid or the Banks have any obligations to make any Loans hereunder (except to the extent that such representations and warranties expressly relate to an earlier date or are affected by the consummation of transactions permitted under this Agreement). All statements contained in any certificate or document delivered to the Operations Agent, the Swing Line Lender or any Bank at any time by or on behalf of the Borrowers, or any of them, pursuant hereto or in connection with the transactions contemplated hereby shall constitute representations and warranties by the Borrowers or such Borrower hereunder. Section 15.07. Parties in Interest; Assignments; Participations. (a) All of the terms of this Agreement shall be binding upon and inure to the benefit of and be enforceable by the respective successors and permitted assigns of the parties hereto and thereto; PROVIDED that none of the Borrowers may assign or transfer their respective rights hereunder or any interest herein without the prior written consent of the Banks. (b) Any Bank may, at any time and from time to time in accordance with applicable law, grant participations in its rights and benefits hereunder and under the other Loan Documents, in part, to any banking or other financial institution or other entity not otherwise prohibited from so acting under the Investment Company Act and having a combined capital and surplus of at least $100,000,000; PROVIDED that each such participation shall be in a minimum -45- amount of $1,000,000. No participant shall be deemed a party to this Agreement or be entitled to exercise the rights of a Bank under this Agreement, including the right to vote, to consent to amendments to, or waivers of, the provisions of this Agreement, or to enforce the obligations of the Borrowers hereunder, except that any Bank may agree with any of its participants that such Bank will not agree, without the consent of the participant, to any amendment or waiver of any provision of this Agreement described in clauses (i), (ii), (iii), (iv) or (v) of Section 15.02(a). Each Borrower agrees that each participant shall, to the extent provided in its participation agreement, be entitled to the benefits of Section 4.07 with respect to its participating interest. (c) Any Bank may, at any time and from time to time in accordance with applicable law, assign its interest in this Agreement and the other Loan Documents, in part, with the prior written consent of the Borrowers (which consent will not be unreasonably withheld or delayed), unless a Default shall have occurred and be continuing, in which case no such consent will be required; PROVIDED that each such assignment shall be in a minimum amount of $5,000,000, and shall be to a banking institution having a combined capital and surplus of at least $100,000,000. Each assignee shall constitute a "bank" (as such term is used in Section 18(f)(1) of the Investment Company Act) in the reasonable judgment of the Operations Agent and the Borrowers, and no bank shall become an assignee pursuant to this Section 15.07(c) if that bank is an Affiliate of any Borrower. All assignments shall be effected pursuant to an assignment and consent agreement substantially in the form of EXHIBIT H attached hereto. Upon the effective date of any assignment by a Bank hereunder, the Operations Agent shall revise SCHEDULE 2 to reflect the necessary adjustments in the Facility Percentage of the assigning Bank and the assignment to such banking or other financial institution. The Operations Agent shall forward a copy of the revised SCHEDULE 2 to the Borrowers. In connection with any such assignment, each of the assignor and the assignee shall pay a processing fee of $3,000 to the Operations Agent, which amounts shall be divided equally between the Operations Agent and the Administrative Agent. If the assignee is not incorporated under the laws of the United States of America or a state thereof, it shall, prior to the first date on which interest or fees are payable hereunder for its account, deliver to the Borrowers and the Operations Agent certification as to exemption from deduction or withholding of any United States federal income taxes in accordance with Section 4.06. (d) Nothing herein shall prohibit any Bank from pledging or assigning any Loan to any Federal Reserve Bank to the extent required by applicable law. In the event of any such assignment, the applicable Borrower(s) will execute and deliver a promissory note payable to such Federal Reserve Bank in the principal amount of the Loan being assigned, which note shall be subject to the terms and conditions of this Agreement. Section 15.08. COUNTERPARTS; ETC. This Agreement may be executed in any number of counterparts and by the different parties hereto on separate counterparts, each of which when so executed and delivered shall be an original, but all the counterparts shall together constitute one and the same instrument. Section 15.09. ENTIRE AGREEMENT; ETC. This Agreement constitutes the entire contract between the parties hereto and shall supersede and take the place of any other instrument purporting to be an agreement of the parties hereto relating to the transactions contemplated hereby. -46- Section 15.10. SEVERABILITY. If any of the provisions of this Agreement or of any of the other Loan Documents or the application thereof to any party hereto or to any Person or circumstance is held to be invalid, illegal or unenforceable in any respect, such invalidity, illegality or unenforceability shall not effect any other term or provision hereof or thereof or the application thereof to any other party hereto or to any other Person or circumstance. Section 15.11. GOVERNING LAW; JURISDICTION; WAIVER. THIS AGREEMENT, INCLUDING THE VALIDITY HEREOF AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER, SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK (WITHOUT GIVING EFFECT TO THE CONFLICT OF LAWS PRINCIPLES THEREOF). EACH BORROWER, TO THE EXTENT THAT IT MAY LAWFULLY DO SO, HEREBY CONSENTS TO SERVICE OF PROCESS, AND TO BE SUED, IN THE COMMONWEALTH OF MASSACHUSETTS AND CONSENTS TO THE JURISDICTION OF THE COURTS OF THE COMMONWEALTH OF MASSACHUSETTS AND THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF MASSACHUSETTS, AS WELL AS TO THE JURISDICTION OF ALL COURTS FROM WHICH AN APPEAL MAY BE TAKEN FROM SUCH COURTS, FOR THE PURPOSE OF ANY SUIT, ACTION OR OTHER PROCEEDING ARISING OUT OF ANY OF ITS OBLIGATIONS HEREUNDER OR WITH RESPECT TO THE TRANSACTIONS CONTEMPLATED HEREBY, AND EXPRESSLY WAIVES ANY AND ALL OBJECTIONS IT MAY HAVE AS TO VENUE IN ANY SUCH COURTS. EACH BORROWER FURTHER AGREES THAT A SUMMONS AND COMPLAINT COMMENCING AN ACTION OR PROCEEDING IN ANY OF SUCH COURTS SHALL BE PROPERLY SERVED AND SHALL CONFER PERSONAL JURISDICTION IF SERVED PERSONALLY OR BY CERTIFIED MAIL TO IT AT ITS ADDRESS PROVIDED IN SECTION 15.04 HEREOF OR AS OTHERWISE PROVIDED UNDER THE LAWS OF THE COMMONWEALTH OF MASSACHUSETTS. EACH OF THE BORROWERS, THE BANKS, THE SWING LINE LENDER AND THE OPERATIONS AGENT IRREVOCABLY WAIVES ALL RIGHTS TO A TRIAL BY JURY IN ANY PROCEEDING HEREAFTER INSTITUTED BY OR AGAINST SUCH BORROWER IN RESPECT OF THIS AGREEMENT OR ANY OTHER DOCUMENTS EXECUTED BY OR ON BEHALF OF SUCH BORROWER IN CONNECTION HEREWITH OR THEREWITH. Section 15.12. INDEMNIFICATION. Each Borrower severally agrees to indemnify and hold harmless the Operations Agent, the Swing Line Lender and the Banks from and against any and all claims, actions and suits whether groundless or otherwise, and from and against any and all liabilities, losses, damages and expenses of every nature and character arising out of this Agreement, the other Loan Documents or the transactions evidenced hereby or thereby insofar as the same may pertain to such Borrower; PROVIDED that neither the Operations Agent, the Swing Line Lender or any Bank shall have the right to be indemnified hereunder with respect to any such claim, action, suit, liability, loss, damage or expense to the extent that it results from its gross negligence or willful misconduct; and FURTHER PROVIDED that no Borrower shall be liable for any settlement, compromise or consent to the entry of any order adjudicating or otherwise disposing of any liability, loss, damage or expense effected without the consent of such Borrower, which consent shall not be unreasonably withheld or delayed. -47- Section 15.13. MISCELLANEOUS. Any instruments required by any of the provisions hereof to be in the form annexed hereto as an exhibit shall be substantially in such form with such changes therefrom, if any, as may be approved by the Banks and the Borrowers. The captions in this Agreement are for convenience of reference only and shall not define or limit the provisions hereof. Section 15.14. CONFIDENTIALITY. Upon the delivery by any Borrower to any Bank or Agent pursuant to this Agreement or the other Loan Documents of any written documentation designated by such Borrower as "Confidential" or bearing a similarly restrictive legend ("Confidential Information"), or the inspection of any such Confidential Information by any Bank or any Agent, such Bank or Agent agrees to treat such Confidential Information as confidential and, in connection therewith, to exercise that degree of care which it affords to its own confidential information. Subject to the other provisions of this Section 15.14, such Bank or Agent may disclose Confidential Information to its officers, directors, employees, attorneys, accountants or other professional consultants engaged by such Bank or Agent only after determining that such third party recipient has been instructed to protect such Confidential Information in accordance with the provisions of this Section 15.14. Notwithstanding the foregoing, the protection afforded by this Section 15.14 shall not apply to information within any one or more of the following categories: (i) information the substance of which, at the time of disclosure to a Bank or Agent or subsequent thereto, has been disclosed to or is known to any other Person, including any other creditor, other than through the fault of such Bank or Agent, and other than (A) a director, officer, employee or agent of any of the Borrower or a professional engaged by the Borrower or (B) a Person who is then under an obligation of non-disclosure to the Borrower; (ii) information which such Bank or Agent had in its possession prior to receipt from the Borrower, or which is otherwise developed by such Bank or Agent independently of the Borrower; or (iii) information received by such Bank or Agent from a third party having, to the actual knowledge of such Bank or Agent, no obligation of non-disclosure with respect thereto. Nothing contained in this Section 15.14 shall prevent any disclosure of any information: (x) believed in good faith by any Bank or Agent to be required by any law or guideline or interpretation or application or grand jury proceeding (whether or not having the force of law), (y) determined by counsel to any Bank or Agent to be necessary or advisable in connection with the enforcement of this Agreement and the other Loan Documents, or (z) which has been made public by a Person other than such Bank or Agent. Each Bank and Agent shall have the right to disclose any Confidential Information to an Assignee or prospective Assignee or to a Participant or prospective Participant under Section 15.07 hereof; PROVIDED that the relevant Bank shall have first obtained from such Assignee or prospective Assignee or Participant or prospective Participant an agreement to protect such Confidential Information in accordance with the provisions of this Section 15.14. ARTICLE XVI. LIMITATION OF LIABILITY Notice is hereby given that this Agreement has been executed by an officer of each Borrower, in that capacity and not individually. The Banks acknowledge that the obligations of or arising out of this Agreement are not binding upon any of the Borrowers' trustees, directors, officers, employees, agents or shareholders individually, but are binding solely upon the assets and property of the Borrowers. Notwithstanding any other provision of this Agreement or any other Loan Document to the contrary, to the extent that this Agreement is executed by an -48- Investment Company on behalf of one or more Portfolios of such Investment Company, as a Borrower(s) hereunder, the Banks further acknowledge that the obligations of or arising out of this Agreement are binding upon the assets and property of the Portfolio on whose behalf an Investment Company has executed this instrument and that, with respect to each such Portfolio, such obligations are several but not joint. Without limiting the foregoing, the obligations of the Borrowers are several, not joint. This Agreement shall be deemed to constitute a separate Agreement between each Borrower and the other parties hereto (other than the other Borrowers) as if such Borrower had executed a separate agreement naming only itself and the other parties hereto (other than the other Borrowers) as parties. No Borrower shall be liable for the obligations (whether for principal, interest, fees, expenses or otherwise) of any other Borrower hereunder. In the case of each Borrower that is an Investment Company organized as a Massachusetts business trust or Portfolio of such an Investment Company, the declarations of trust for each such trust refer to the trustees collectively as trustees and not as individuals personally, and the declarations of trust provide that no shareholder, trustee, officer, employee or agent of the trust shall be subject to claims against or obligations of the trust to any extent whatsoever, but that the trust estate only shall be liable. IN WITNESS WHEREOF, the parties hereto have executed this Agreement as a sealed instrument as of the date first above written. WARBURG PINCUS CAPITAL WARBURG PINCUS EMERGING APPRECIATION FUND GROWTH FUND, INC. By: /s/ Janna Manes By: /s/ Janna Manes ------------------------------ ----------------------------- Name: Janna Manes Name: Janna Manes ---------------------------- --------------------------- Title: Vice President & Secretary Title: Vice President & Secretary --------------------------- -------------------------- WARBURG PINCUS INTERNATIONAL WARBURG PINCUS INTERNATIONAL EQUITY FUND, INC. SMALL COMPANY FUND, INC. By: /s/ Janna Manes By: /s/ Janna Manes ------------------------------ ----------------------------- Name: Janna Manes Name: Janna Manes ---------------------------- --------------------------- Title: Vice President & Secretary Title: Vice President & Secretary --------------------------- -------------------------- WARBURG PINCUS JAPAN SMALL WARBURG PINCUS JAPAN GROWTH COMPANY FUND, INC. FUND, INC. By: /s/ Janna Manes By: /s/ Janna Manes ------------------------------ ----------------------------- Name: Janna Manes Name: Janna Manes ---------------------------- --------------------------- Title: Vice President & Secretary Title: Vice President & Secretary --------------------------- -------------------------- WARBURG PINCUS EMERGING WARBURG PINCUS POST VENTURE MARKETS FUND, INC. CAPITAL FUND, INC. By: /s/ Janna Manes By: /s/ Janna Manes ------------------------------ ----------------------------- Name: Janna Manes Name: Janna Manes ---------------------------- --------------------------- Title: Vice President & Secretary Title: Vice President & Secretary --------------------------- -------------------------- -49- WARBURG PINCUS MAJOR FOREIGN WARBURG PINCUS SMALL COMPANY MARKETS FUND, INC. VALUE FUND, INC. By: /s/ Janna Manes By: /s/ Janna Manes ------------------------------ ----------------------------- Name: Janna Manes Name: Janna Manes ---------------------------- --------------------------- Title: Vice President & Secretary Title: Vice President & Secretary --------------------------- -------------------------- WARBURG PINCUS SMALL COMPANY WARBURG PINCUS GLOBAL POST GROWTH FUND, INC. VENTURE CAPITAL FUND, INC. By: /s/ Janna Manes By: /s/ Janna Manes ------------------------------ ----------------------------- Name: Janna Manes Name: Janna Manes ---------------------------- --------------------------- Title: Vice President & Secretary Title: Vice President & Secretary --------------------------- -------------------------- WARBURG PINCUS HEALTH SCIENCES WARBURG PINCUS FIXED INCOME FUND, INC. FUND By: /s/ Janna Manes By: /s/ Janna Manes ------------------------------ ----------------------------- Name: Janna Manes Name: Janna Manes ---------------------------- --------------------------- Title: Vice President & Secretary Title: Vice President & Secretary --------------------------- -------------------------- WARBURG PINCUS GLOBAL FIXED WARBURG PINCUS INTERMEDIATE INCOME FUND, INC. MATURITY GOVERNMENT FUND, INC. By: /s/ Janna Manes By: /s/ Janna Manes ------------------------------ ----------------------------- Name: Janna Manes Name: Janna Manes ---------------------------- --------------------------- Title: Vice President & Secretary Title: Vice President & Secretary --------------------------- -------------------------- WARBURG PINCUS BALANCED FUND, WARBURG PINCUS GROWTH & INC. INCOME FUND, INC. By: /s/ Janna Manes By: /s/ Janna Manes ------------------------------ ----------------------------- Name: Janna Manes Name: Janna Manes ---------------------------- --------------------------- Title: Vice President & Secretary Title: Vice President & Secretary --------------------------- -------------------------- WARBURG PINCUS NEW YORK WARBURG PINCUS EMERGING INTERMEDIATE MUNICIPAL FUND MARKETS II FUND, INC. By: /s/ Janna Manes By: /s/ Janna Manes ------------------------------ ----------------------------- Name: Janna Manes Name: Janna Manes ---------------------------- --------------------------- Title: Vice President & Secretary Title: Vice President & Secretary --------------------------- -------------------------- WARBURG PINCUS GLOBAL WARBURG PINCUS INTERNATIONAL TELECOMMUNICATIONS FUND, INC. GROWTH FUND, INC. By: /s/ Janna Manes By: /s/ Janna Manes ------------------------------ ----------------------------- Name: Janna Manes Name: Janna Manes ---------------------------- --------------------------- Title: Vice President & Secretary Title: Vice President & Secretary --------------------------- -------------------------- -50- WARBURG PINCUS HIGH YIELD WARBURG PINCUS MUNICIPAL BOND FUND, INC. FUND, INC. By: /s/ Janna Manes By: /s/ Janna Manes ------------------------------ ----------------------------- Name: Janna Manes Name: Janna Manes ---------------------------- --------------------------- Title: Vice President & Secretary Title: Vice President & Secretary --------------------------- -------------------------- WARBURG PINCUS STRATEGIC GLOBAL WARBURG PINCUS EUROPEAN FIXED INCOME FUND, INC. EQUITY FUND, INC. By: /s/ Janna Manes By: /s/ Janna Manes ------------------------------ ----------------------------- Name: Janna Manes Name: Janna Manes ---------------------------- --------------------------- Title: Vice President & Secretary Title: Vice President & Secretary --------------------------- -------------------------- WARBURG PINCUS U.S. CORE FIXED WARBURG PINCUS LONG- SHORT INCOME FUND, INC. MARKET NEUTRAL FUND, INC. By: /s/ Janna Manes By: /s/ Janna Manes ------------------------------ ----------------------------- Name: Janna Manes Name: Janna Manes ---------------------------- --------------------------- Title: Vice President & Secretary Title: Vice President & Secretary --------------------------- -------------------------- WARBURG PINCUS LONG-SHORT WARBURG PINCUS SELECT ECONOMIC EQUITY FUND, INC. VALUE EQUITY FUND, INC. By: /s/ Janna Manes By: /s/ Janna Manes ------------------------------ ----------------------------- Name: Janna Manes Name: Janna Manes ---------------------------- --------------------------- Title: Vice President & Secretary Title: Vice President & Secretary --------------------------- -------------------------- WARBURG PINCUS INSTITUTIONAL WARBURG PINCUS TRUST, on behalf FUND, INC., on behalf of International of International Equity Portfolio Equity Portfolio, Small Company Growth Small Company Growth Portfolio, Portfolio, Emerging Markets Portfolio, Emerging Markets Portfolio, Post Value Portfolio, Japan Growth Portfolio, Venture Capital Portfolio, and Post Venture Capital Portfolio, and Small Growth & Income Portfolio Company Value Portfolio By: /s/ Janna Manes By: /s/ Janna Manes ------------------------------ ----------------------------- Name: Janna Manes Name: Janna Manes ---------------------------- --------------------------- Title: Vice President & Secretary Title: Vice President & Secretary --------------------------- -------------------------- WARBURG PINCUS TRUST II, on behalf of Fixed Income Portfolio and Global Fixed Income Portfolio By: /s/ Janna Manes ----------------------------------- Name: Janna Manes --------------------------------- Title: Vice President & Secretary -------------------------------- -51- STATE STREET BANK AND TRUST DEUTSCHE BANK AG, NEW YORK COMPANY, in its individual capacity BRANCH, in its individual and as Operations Agent capacity and as Administrative Agent By: /s/ Edward A. Siegel By: /s/ Alan Krouk ------------------------------ ----------------------------- Name: Edward A. Siegel Name: Alan Krouk ---------------------------- --------------------------- Title: Vice President Title: Assistant Vice President --------------------------- -------------------------- By: /s/ Ruth Leung ----------------------------- Name: Ruth Leung --------------------------- Title: Director -------------------------- BANK OF NOVA SCOTIA, in its individual BANQUE NATIONALE DE PARIS capacity and as Syndication Agent By: By: /s/ Marguerite L. Lebon ------------------------------ ----------------------------- Name: Name: Marguerite L. Lebon ---------------------------- --------------------------- Title: Title: Assistant Vice President --------------------------- -------------------------- By: /s/ Laurent Vanderzyppe ----------------------------- Name: Laurent Vanderzyppe --------------------------- Title: V.P. -------------------------- SCHEDULE 1 Dated as of June 23, 1999 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; and State Street Bank and Trust Company, as operations agent
NAME AND ADDRESS FORM OF JURISDICTION OF PERCENTAGE OF BORROWER ORGANIZATION ORGANIZATION ALLOCATION OF FEES AND EXPENSES Warburg, Pincus Capital Massachusetts Massachusetts 3.04% Appreciation Fund* Business Trust
466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: Warburg, Pincus Capital Appreciation Fund By: /s/ Janna Manes --------------------------------- Name: Janna Manes Title: Vice President & Secretary STANDING INSTRUCTIONS: Account Name: Warburg Pincus Capital Appreciation Fund Account Number: 0360567 Bank: PNC Bank ABA No.: 031 000 053 Attn: Charles Geiser SCHEDULE 1 Dated as of June 23, 1999 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; and State Street Bank and Trust Company, as operations agent
NAME AND ADDRESS FORM OF JURISDICTION OF PERCENTAGE OF BORROWER ORGANIZATION ORGANIZATION ALLOCATION OF FEES AND EXPENSES Warburg, Pincus Corporation Maryland 6.38% Emerging Growth Fund, Inc.*
466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: Warburg, Pincus Emerging Growth Fund, Inc. By: /s/ Janna Manes --------------------------------- Name: Janna Manes Title: Vice President & Secretary Standing Instructions: Account Name: Warburg Pincus Emerging Growth Fund Account Number: 0361660 Bank: PNC Bank ABA No.: 031 000 053 Attn: Charles Geiser SCHEDULE 1 Dated as of June 23, 1999 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; and State Street Bank and Trust Company, as operations agent
NAME AND ADDRESS FORM OF JURISDICTION OF PERCENTAGE OF BORROWER ORGANIZATION ORGANIZATION ALLOCATION OF FEES AND EXPENSES Warburg, Pincus Corporation Maryland 46.38% International Equity Fund, Inc.**
466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: Warburg, Pincus International Equity Fund, Inc. By: /s/ Janna Manes --------------------------------- Name: Janna Manes Title: Vice President & Secretary STANDING INSTRUCTIONS: Account Name: Warburg Pincus International Equity Fund/TH Account Number: 70887658 Bank: State Street/Boston ABA No.: 011 000 028 Attn: Charles Geiser SCHEDULE 1 Dated as of June 23, 1999 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; and State Street Bank and Trust Company, as operations agent
NAME AND ADDRESS FORM OF JURISDICTION OF PERCENTAGE OF BORROWER ORGANIZATION ORGANIZATION ALLOCATION OF FEES AND EXPENSES Warburg, Pincus Corporation Maryland 0.01% International Small Company Fund, Inc.**
466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: Warburg, Pincus International Small Company Fund, Inc. By: /s/ Janna Manes ------------------------- Name: Janna Manes Title: Vice President & Secretary STANDING INSTRUCTIONS: Account Name: Warburg Pincus International Small Company Fund/TH23 Account Number: 70887765 Bank: State Street/Boston ABA No.: 011 000 028 Attn: Charles Geiser SCHEDULE 1 Dated as of June 23, 1999 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; and State Street Bank and Trust Company, as operations agent
NAME AND ADDRESS FORM OF JURISDICTION OF PERCENTAGE OF BORROWER ORGANIZATION ORGANIZATION ALLOCATION OF FEES AND EXPENSES Warburg, Pincus Japan Corporation Maryland 12.42% Small Company Fund, Inc.**
466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: Warburg, Pincus Japan Small Company Fund, Inc. By: /s/ Janna Manes --------------------------------- Name: Janna Manes Title: Vice President & Secretary STANDING INSTRUCTIONS: Account Name: Warburg Pincus Japan Small Company Fund/TH Account Number: 70887468 Bank: State Street/Boston ABA No.: 011 000 028 Attn: Charles Geiser SCHEDULE 1 Dated as of June 23, 1999 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; and State Street Bank and Trust Company, as operations agent
NAME AND ADDRESS FORM OF JURISDICTION OF PERCENTAGE OF BORROWER ORGANIZATION ORGANIZATION ALLOCATION OF FEES AND EXPENSES Warburg, Pincus Japan Corporation Maryland 9.78% Growth Fund, Inc.**
466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: Warburg, Pincus Japan Growth Fund, Inc. By: /s/ Janna Manes --------------------------------- Name: Janna Manes Title: Vice President & Secretary STANDING INSTRUCTIONS: Account Name: Warburg Pincus Japan Growth Fund/TH Account Number: 70887690 Bank: State Street/Boston ABA No.: 011 000 028 Attn: Charles Geiser SCHEDULE 1 Dated as of June 23, 1999 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; and State Street Bank and Trust Company, as operations agent
NAME AND ADDRESS FORM OF JURISDICTION OF PERCENTAGE OF BORROWER ORGANIZATION ORGANIZATION ALLOCATION OF FEES AND EXPENSES Warburg, Pincus Corporation Maryland 0.44% Emerging Markets Fund, Inc.***
466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: Warburg, Pincus Emerging Markets Fund, Inc. By: /s/ Janna Manes --------------------------------- Name: Janna Manes Title: Vice President & Secretary STANDING INSTRUCTIONS: Account Name: Warburg Pincus Emerging Markets Fund/TH02 Account Number: 70887443 Bank: State Street/Boston ABA No.: 011 000 028 Attn: Charles Geiser SCHEDULE 1 Dated as of June 23, 1999 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; and State Street Bank and Trust Company, as operations agent
NAME AND ADDRESS FORM OF JURISDICTION OF PERCENTAGE OF BORROWER ORGANIZATION ORGANIZATION ALLOCATION OF FEES AND EXPENSES Warburg, Pincus Corporation Maryland 0.22% Post-Venture Capital Fund, Inc.*
466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: Warburg, Pincus Post-Venture Capital Fund, Inc. By: /s/ Janna Manes --------------------------------- Name: Janna Manes Title: Vice President & Secretary STANDING INSTRUCTIONS: Account Name: Warburg Pincus Post-Venture Capi tal Fund Account Number: 0367462 Bank: PNC Bank ABA No.: 031 000 053 Attn: Charles Geiser SCHEDULE 1 Dated as of June 23, 1999 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; and State Street Bank and Trust Company, as operations agent
NAME AND ADDRESS FORM OF JURISDICTION OF PERCENTAGE OF BORROWER ORGANIZATION ORGANIZATION ALLOCATION OF FEES AND EXPENSES Warburg, Pincus Major Corporation Maryland 0.18% Foreign Markets Fund, Inc.**
466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: Warburg, Pincus Major Foreign Markets Fund, Inc. By: /s/ Janna Manes --------------------------------- Name: Janna Manes Title: Vice President & Secretary STANDING INSTRUCTIONS: Account Name: Warburg Pincus Major Foreign Markets Fund/TH12 Account Number: 70887674 Bank: State Street/Boston ABA No.: 011 000 028 Attn: Charles Geiser SCHEDULE 1 Dated as of June 23, 1999 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; and State Street Bank and Trust Company, as operations agent
NAME AND ADDRESS FORM OF JURISDICTION OF PERCENTAGE OF BORROWER ORGANIZATION ORGANIZATION ALLOCATION OF FEES AND EXPENSES Warburg, Pincus Small Corporation Maryland 0.14% Company Value Fund, Inc.*
466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: Warburg, Pincus Small Company Value Fund, Inc. By: /s/ Janna Manes --------------------------------- Name: Janna Manes Title: Vice President & Secretary STANDING INSTRUCTIONS: Account Name: Warburg Pincus Small Company Value Fund Account Number: 0367470 Bank: PNC Bank ABA No.: 031 000 053 Attn: Charles Geiser SCHEDULE 1 Dated as of June 23, 1999 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; and State Street Bank and Trust Company, as operations agent
NAME AND ADDRESS FORM OF JURISDICTION OF PERCENTAGE OF BORROWER ORGANIZATION ORGANIZATION ALLOCATION OF FEES AND EXPENSES Warburg, Pincus Small Corporation Maryland 0.09% Company Growth Fund, Inc.*
466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: Warburg, Pincus Small Company Growth Fund, Inc. By: /s/ Janna Manes --------------------------------- Name: Janna Manes Title: Vice President & Secretary STANDING INSTRUCTIONS: Account Name: Warburg Pincus Small Company Growth Fund Account Number: 0367527 Bank: PNC Bank ABA No.: 031 000 053 Attn: Charles Geiser SCHEDULE 1 Dated as of June 23, 1999 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; and State Street Bank and Trust Company, as operations agent
NAME AND ADDRESS FORM OF JURISDICTION OF PERCENTAGE OF BORROWER ORGANIZATION ORGANIZATION ALLOCATION OF FEES AND EXPENSES Warburg, Pincus Global Corporation Maryland 0.02% Post-Venture Capital Fund, Inc.**
466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: Warburg, Pincus Global Post-Venture Capital Fund, Inc. By: /s/ Janna Manes --------------------------------- Name: Janna Manes Title: Vice President & Secretary Standing Instructions: Account Name: Warburg Pincus Global Post-Venture Capital Fund Account Number: 0367496 Bank: PNC Bank ABA No.: 031 000 053 Attn: Charles Geiser SCHEDULE 1 Dated as of June 23, 1999 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; and State Street Bank and Trust Company, as operations agent
NAME AND ADDRESS FORM OF JURISDICTION OF PERCENTAGE OF BORROWER ORGANIZATION ORGANIZATION ALLOCATION OF FEES AND EXPENSES Warburg, Pincus Health Corporation Maryland 0.88% Sciences Fund, Inc.*
466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: Warburg, Pincus Health Sciences Fund, Inc. By: /s/ Janna Manes --------------------------------- Name: Janna Manes Title: Vice President & Secretary STANDING INSTRUCTIONS: Account Name: Warburg Pincus Health Sciences Fund Account Number: 0367519 Bank: PNC Bank ABA No.: 031 000 053 Attn: Charles Geiser SCHEDULE 1 Dated as of June 23, 1999 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; and State Street Bank and Trust Company, as operations agent
NAME AND ADDRESS FORM OF JURISDICTION OF PERCENTAGE OF BORROWER ORGANIZATION ORGANIZATION ALLOCATION OF FEES AND EXPENSES Warburg, Pincus Fixed Massachusetts Massachusetts 1.40% Income Fund* Business Trusts
466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: Warburg, Pincus Fixed Income Fund By: /s/ Janna Manes --------------------------------- Name: Janna Manes Title: Vice President & Secretary STANDING INSTRUCTIONS: Account Name: Warburg Pincus Fixed Income Fund Account Number: 0360656 Bank: PNC Bank ABA No.: 031 000 053 Attn: Charles Geiser SCHEDULE 1 Dated as of June 23, 1999 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; and State Street Bank and Trust Company, as operations agent
NAME AND ADDRESS FORM OF JURISDICTION OF PERCENTAGE OF BORROWER ORGANIZATION ORGANIZATION ALLOCATION OF FEES AND EXPENSES Warburg, Pincus Global Corporation Maryland 0.50% Fixed Income Fund, Inc.**
466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: Warburg, Pincus Global Fixed Income Fund, Inc. By: /s/ Janna Manes --------------------------------- Name: Janna Manes Title: Vice President & Secretary STANDING INSTRUCTIONS: Account Name: Warburg Pincus Global Fixed Income Fund/TH18 Account Number: 70887633 Bank: State Street/Boston ABA No.: 011 000 028 Attn: Charles Geiser SCHEDULE 1 Dated as of June 23, 1999 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; and State Street Bank and Trust Company, as operations agent
NAME AND ADDRESS FORM OF JURISDICTION OF PERCENTAGE OF BORROWER ORGANIZATION ORGANIZATION ALLOCATION OF FEES AND EXPENSES Warburg, Pincus Corporation Maryland 0.23% Intermediate Maturity Government Fund, Inc.*
466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: Warburg, Pincus Intermediate Maturity Government Fund, Inc. By: /s/ Janna Manes --------------------------------- Name: Janna Manes Title: Vice President & Secretary STANDING INSTRUCTIONS: Account Name: Warburg Pincus Intermediate Maturity Government Fund, Inc. Account Number: 0361783 Bank: PNC Bank ABA No.: 031 000 053 Attn: Charles Geiser SCHEDULE 1 Dated as of June 23, 1999 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; and State Street Bank and Trust Company, as operations agent
NAME AND ADDRESS FORM OF JURISDICTION OF PERCENTAGE OF BORROWER ORGANIZATION ORGANIZATION ALLOCATION OF FEES AND EXPENSES Warburg, Pincus Corporation Maryland 0.11% Balanced Fund, Inc.*
466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: Warburg, Pincus Balanced Fund, Inc. By: /s/ Janna Manes --------------------------------- Name: Janna Manes Title: Vice President & Secretary STANDING INSTRUCTIONS: Account Name: Warburg Pincus Balanced Fund Account Number: 0181191 Bank: PNC Bank ABA No.: 031 000 053 Attn: Charles Geiser SCHEDULE 1 Dated as of June 23, 1999 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; and State Street Bank and Trust Company, as operations agent
NAME AND ADDRESS FORM OF JURISDICTION OF PERCENTAGE OF BORROWER ORGANIZATION ORGANIZATION ALLOCATION OF FEES AND EXPENSES Warburg, Pincus Growth Corporation Maryland 2.41% & Income Fund, Inc.
466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: Warburg, Pincus Growth & Income Fund, Inc. By: /s/ Janna Manes --------------------------------- Name: Janna Manes Title: Vice President & Secretary STANDING INSTRUCTIONS: Account Name: Warburg Pincus Growth & Income Fund Account Number: 0181175 Bank: PNC Bank ABA No.: 031 000 053 Attn: Charles Geiser SCHEDULE 1 Dated as of June 23, 1999 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; and State Street Bank and Trust Company, as operations agent
NAME AND ADDRESS FORM OF JURISDICTION OF PERCENTAGE OF BORROWER ORGANIZATION ORGANIZATION ALLOCATION OF FEES AND EXPENSES Warburg, Pincus New Massachusetts Massachusetts 0.36% York Intermediate Business Trusts Municipal Fund*
466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: Warburg, Pincus New York Intermediate Municipal Government Fund By: /s/ Janna Manes --------------------------------- Name: Janna Manes Title: Vice President & Secretary STANDING INSTRUCTIONS: Account Name: Warburg Pincus New York Intermediate Municipal Fund Account Number: 018144 Bank: PNC Bank ABA No.: 031 000 053 Attn: Charles Geiser SCHEDULE 1 Dated as of June 23, 1999 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; and State Street Bank and Trust Company, as operations agent
NAME AND ADDRESS FORM OF JURISDICTION OF PERCENTAGE OF BORROWER ORGANIZATION ORGANIZATION ALLOCATION OF FEES AND EXPENSES Warburg, Pincus Corporation Maryland 0.07% Emerging Markets II Fund, Inc.***
466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: Warburg, Pincus Emerging Markets II Fund, Inc. By: /s/ Janna Manes --------------------------------- Name: Janna Manes Title: Vice President & Secretary STANDING INSTRUCTIONS: Account Name: Warburg Pincus Emerging Markets II Fund Account Number: 8122806 Bank: Brown Brothers ABA No.: 09250276 Attn: Charles Geiser SCHEDULE 1 Dated as of June 23, 1999 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; and State Street Bank and Trust Company, as operations agent
NAME AND ADDRESS FORM OF JURISDICTION OF PERCENTAGE OF BORROWER ORGANIZATION ORGANIZATION ALLOCATION OF FEES AND EXPENSES Warburg, Pincus Global Corporation Maryland 0.04% Telecommunications Fund, Inc.**
466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: Warburg, Pincus Global Telecommunications Fund, Inc. By: /s/ Janna Manes --------------------------------- Name: Janna Manes Title: Vice President & Secretary STANDING INSTRUCTIONS: Account Name: Warburg Pincus Global Telecommunications Fund Account Number: 8124695 Bank: Brown Brothers ABA No.: 09250276 Attn: Charles Geiser SCHEDULE 1 Dated as of June 23, 1999 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; and State Street Bank and Trust Company, as operations agent
NAME AND ADDRESS FORM OF JURISDICTION OF PERCENTAGE OF BORROWER ORGANIZATION ORGANIZATION ALLOCATION OF FEES AND EXPENSES Warburg, Pincus Corporation Maryland 2.43% International Growth Fund, Inc.**
466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: Warburg, Pincus International Growth Fund, Inc. By: /s/ Janna Manes --------------------------------- Name: Janna Manes Title: Vice President & Secretary STANDING INSTRUCTIONS: Account Name: Warburg Pincus International Growth Fund Account Number: 8122814 Bank: Brown Brothers ABA No.: 09250276 Attn: Charles Geiser SCHEDULE 1 Dated as of June 23, 1999 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; and State Street Bank and Trust Company, as operations agent
NAME AND ADDRESS FORM OF JURISDICTION OF PERCENTAGE OF BORROWER ORGANIZATION ORGANIZATION ALLOCATION OF FEES AND EXPENSES Warburg, Pincus High Corporation Maryland 0.48% Yield Fund, Inc.*
466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: Warburg, Pincus High Yield Fund, Inc. By: /s/ Janna Manes --------------------------------- Name: Janna Manes Title: Vice President & Secretary STANDING INSTRUCTIONS: Account Name: Warburg Pincus High Yield Fund Account Number: 8122822 Bank: Brown Brothers ABA No.: 09250276 Attn: Charles Geiser SCHEDULE 1 Dated as of June 23, 1999 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; and State Street Bank and Trust Company, as operations agent
NAME AND ADDRESS FORM OF JURISDICTION OF PERCENTAGE OF BORROWER ORGANIZATION ORGANIZATION ALLOCATION OF FEES AND EXPENSES Warburg, Pincus Corporation Maryland 0.08% Municipal Bond Fund, Inc.*
466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: Warburg, Pincus Municipal Bond Fund, Inc. By: /s/ Janna Manes --------------------------------- Name: Janna Manes Title: Vice President & Secretary STANDING INSTRUCTIONS: Account Name: Warburg Pincus Municipal Bond Fund Account Number: 8122855 Bank: Brown Brothers ABA No.: 09250276 Attn: Charles Geiser SCHEDULE 1 Dated as of June 23, 1999 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; and State Street Bank and Trust Company, as operations agent
NAME AND ADDRESS FORM OF JURISDICTION OF PERCENTAGE OF BORROWER ORGANIZATION ORGANIZATION ALLOCATION OF FEES AND EXPENSES Warburg, Pincus Corporation Maryland 0.10% Strategic Global Fixed Income Fund, Inc.**
466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: Warburg, Pincus Strategic Global Fixed Income Fund, Inc. By: /s/ Janna Manes --------------------------------- Name: Janna Manes Title: Vice President & Secretary STANDING INSTRUCTIONS: Account Name: Warburg Pincus Strategic Global Fixed Income Fund Account Number: 8122830 Bank: Brown Brothers ABA No.: 09250276 Attn: Charles Geiser SCHEDULE 1 Dated as of June 23, 1999 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; and State Street Bank and Trust Company, as operations agent
NAME AND ADDRESS FORM OF JURISDICTION OF PERCENTAGE OF BORROWER ORGANIZATION ORGANIZATION ALLOCATION OF FEES AND EXPENSES Warburg, Pincus Corporation Maryland 0.09% European Equity Fund, Inc.**
466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: Warburg, Pincus European Equity Fund, Inc. By: /s/ Janna Manes --------------------------------- Name: Janna Manes Title: Vice President & Secretary STANDING INSTRUCTIONS: Account Name: Warburg Pincus European Equity Fund Account Number: 6105167 Bank: Brown Brothers ABA No.: 09250276 Attn: Charles Geiser SCHEDULE 1 Dated as of June 23, 1999 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; and State Street Bank and Trust Company, as operations agent
NAME AND ADDRESS FORM OF JURISDICTION OF PERCENTAGE OF BORROWER ORGANIZATION ORGANIZATION ALLOCATION OF FEES AND EXPENSES Warburg, Pincus U.S. Corporation Maryland 1.27% Core Fixed Income Fund, Inc.*
466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: Warburg, Pincus U.S. Core Fixed Income Fund, Inc. By: /s/ Janna Manes --------------------------------- Name: Janna Manes Title: Vice President & Secretary STANDING INSTRUCTIONS: Account Name: Warburg Pincus U.S. Core Fixed Income Fund Account Number: 8122913 Bank: Brown Brothers ABA No.: 09250276 Attn: Charles Geiser SCHEDULE 1 Dated as of June 23, 1999 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; and State Street Bank and Trust Company, as operations agent
NAME AND ADDRESS FORM OF JURISDICTION OF PERCENTAGE OF BORROWER ORGANIZATION ORGANIZATION ALLOCATION OF FEES AND EXPENSES Warburg, Pincus Long- Corporation Maryland 0.09% Short Market Neutral Fund, Inc.***
466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: Warburg, Pincus Long-Short Market Neutral Fund, Inc. By: /s/ Janna Manes --------------------------------- Name: Janna Manes Title: Vice President & Secretary STANDING INSTRUCTIONS: Account Name: Warburg Pincus Long-Short Market Neutral Fund Account Number: 113-80260 Bank: Custodial Trust Company ABA No.: 031207526 Attn: Charles Geiser SCHEDULE 1 Dated as of June 23, 1999 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; and State Street Bank and Trust Company, as operations agent
NAME AND ADDRESS FORM OF JURISDICTION OF PERCENTAGE OF BORROWER ORGANIZATION ORGANIZATION ALLOCATION OF FEES AND EXPENSES Warburg, Pincus Long- Corporation Maryland 0.00% Short Equity Fund, Inc.***
466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: Warburg, Pincus Long-Short Equity Fund, Inc. By: /s/ Janna Manes --------------------------------- Name: Janna Manes Title: Vice President & Secretary STANDING INSTRUCTIONS: Account Name: Warburg Pincus Long-Short Equity Fund Account Number: 113-80262 Bank: Custodial Trust Company ABA No.: 031207596 Attn: Charles Geiser SCHEDULE 1 Dated as of June 23, 1999 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; and State Street Bank and Trust Company, as operations agent
NAME AND ADDRESS FORM OF JURISDICTION OF PERCENTAGE OF BORROWER ORGANIZATION ORGANIZATION ALLOCATION OF FEES AND EXPENSES Warburg, Pincus Select Corporation Maryland 0.12% Economic Value Fund, Inc.*
466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: Warburg, Pincus Select Economic Value Fund, Inc. By: /s/ Janna Manes --------------------------------- Name: Janna Manes Title: Vice President & Secretary STANDING INSTRUCTIONS: Account Name: Warburg Pincus Select Economic Value Equity Fund Account Number: 6103063 Bank: Brown Brothers ABA No.: 09250276 Attn: Charles Geiser SCHEDULE 1 Dated as of June 23, 1999 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; and State Street Bank and Trust Company, as operations agent
NAME AND ADDRESS FORM OF JURISDICTION OF PERCENTAGE OF BORROWER ORGANIZATION ORGANIZATION ALLOCATION OF FEES AND EXPENSES Emerging Markets Massachusetts Massachusetts 0.01% Portfolio - Warburg, Business Trust Pincus Trust***
466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: Warburg, Pincus Trust By: /s/ Janna Manes --------------------------------- Name: Janna Manes Title: Vice President & Secretary STANDING INSTRUCTIONS: Account Name: Trust - Emerging Markets Portfolio/TH Account Number: 7088759 Bank: State Street/Boston ABA No.: 011 000 028 Attn: Charles Geiser SCHEDULE 1 Dated as of June 23, 1999 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; and State Street Bank and Trust Company, as operations agent
NAME AND ADDRESS FORM OF JURISDICTION OF PERCENTAGE OF BORROWER ORGANIZATION ORGANIZATION ALLOCATION OF FEES AND EXPENSES Growth & Income Massachusetts Massachusetts 0.05% Portfolio - Warburg, Business Trust Pincus Trust*
466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: Warburg, Pincus Trust By: /s/ Janna Manes --------------------------------- Name: Janna Manes Title: Vice President & Secretary STANDING INSTRUCTIONS: Account Name: Trust - Growth & Income Portfolio Account Number: 0367250 Bank: PNC Bank ABA No.: 031 000 053 Attn: Charles Geiser SCHEDULE 1 Dated as of June 23, 1999 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; and State Street Bank and Trust Company, as operations agent
NAME AND ADDRESS FORM OF JURISDICTION OF PERCENTAGE OF BORROWER ORGANIZATION ORGANIZATION ALLOCATION OF FEES AND EXPENSES International Equity Massachusetts Massachusetts 1.17% Portfolio - Warburg, Business Trust Pincus Trust**
466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: Warburg, Pincus Trust By: /s/ Janna Manes --------------------------------- Name: Janna Manes Title: Vice President & Secretary STANDING INSTRUCTIONS: Account Name: Trust - International Equity Portfolio Account Number: 70887542 Bank: State Street/Boston ABA No.: 011 000 028 Attn: Charles Geiser SCHEDULE 1 Dated as of June 23, 1999 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; and State Street Bank and Trust Company, as operations agent
NAME AND ADDRESS FORM OF JURISDICTION OF PERCENTAGE OF BORROWER ORGANIZATION ORGANIZATION ALLOCATION OF FEES AND EXPENSES Warburg, Pincus Trust* Massachusetts Massachusetts 0.21% Post-Venture Capital Business Trust Portfolio
466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: Warburg, Pincus Trust By: /s/ Janna Manes --------------------------------- Name: Janna Manes Title: Vice President & Secretary STANDING INSTRUCTIONS: Account Name: Trust - Post-Venture Capital Portfolio Account Number: 0367501 Bank: PNC Bank ABA No.: 031 000 053 Attn: Charles Geiser SCHEDULE 1 Dated as of June 23, 1999 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; and State Street Bank and Trust Company, as operations agent
NAME AND ADDRESS FORM OF JURISDICTION OF PERCENTAGE OF BORROWER ORGANIZATION ORGANIZATION ALLOCATION OF FEES AND EXPENSES Small Company Growth Massachusetts Massachusetts 2.28% Portfolio - Warburg, Business Trust Pincus Trust*
466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: Warburg, Pincus Trust By: /s/ Janna Manes --------------------------------- Name: Janna Manes Title: Vice President & Secretary STANDING INSTRUCTIONS: Account Name: Trust - Small Company Growth Portfolio Account Number: 0186117 Bank: PNC Bank ABA No.: 031 000 053 Attn: Charles Geiser SCHEDULE 1 Dated as of June 23, 1999 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; and State Street Bank and Trust Company, as operations agent
NAME AND ADDRESS FORM OF JURISDICTION OF PERCENTAGE OF BORROWER ORGANIZATION ORGANIZATION ALLOCATION OF FEES AND EXPENSES Emerging Markets Corporation Maryland 0.18% Portfolio - Warburg, Pincus Institutional Fund, Inc.***
466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: Warburg, Pincus Institutional Fund, Inc. By: /s/ Janna Manes --------------------------------- Name: Janna Manes Title: Vice President & Secretary STANDING INSTRUCTIONS: Account Name: Institutional - Emerging Markets Portfolio/TH0 Account Number: 34940072 Bank: State Street/Boston ABA No.: 011 000 028 Attn: Charles Geiser SCHEDULE 1 Dated as of June 23, 1999 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; and State Street Bank and Trust Company, as operations agent
NAME AND ADDRESS FORM OF JURISDICTION OF PERCENTAGE OF BORROWER ORGANIZATION ORGANIZATION ALLOCATION OF FEES AND EXPENSES International Equity Corporation Maryland 5.35% Portfolio- Warburg, Pincus Institutional Fund, Inc.**
466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: Warburg, Pincus Institutional Fund, Inc. By: /s/ Janna Manes --------------------------------- Name: Janna Manes Title: Vice President & Secretary STANDING INSTRUCTIONS: Account Name: Institutional - International Equity Portfolio Account Number: 70887666 Bank: State Street/Boston ABA No.: 011 000 028 Attn: Charles Geiser SCHEDULE 1 Dated as of June 23, 1999 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; and State Street Bank and Trust Company, as operations agent
NAME AND ADDRESS FORM OF JURISDICTION OF PERCENTAGE OF BORROWER ORGANIZATION ORGANIZATION ALLOCATION OF FEES AND EXPENSES Japan Growth Portfolio - Corporation Maryland 0.01% Warburg, Pincus Institutional Fund, Inc.**
466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: Warburg, Pincus Institutional Fund, Inc. By: /s/ Janna Manes --------------------------------- Name: Janna Manes Title: Vice President & Secretary STANDING INSTRUCTIONS: Account Name: Institutional - Japan Growth Portfolio/TH Account Number: 70887682 Bank: State Street/Boston ABA No.: 011 000 028 Attn: Charles Geiser SCHEDULE 1 Dated as of June 23, 1999 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; and State Street Bank and Trust Company, as operations agent
NAME AND ADDRESS FORM OF JURISDICTION OF PERCENTAGE OF BORROWER ORGANIZATION ORGANIZATION ALLOCATION OF FEES AND EXPENSES Post-Venture Capital Corporation Maryland 0.00% Portfolio - Warburg, Pincus Institutional Fund, Inc.*
466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: Warburg, Pincus Institutional Fund, Inc. By: /s/ Janna Manes --------------------------------- Name: Janna Manes Title: Vice President & Secretary STANDING INSTRUCTIONS: Account Name: Institutional - Post-Venture Capital Portfolio Account Number: 0367234 Bank: PNC Bank ABA No.: 031 000 053 Attn: Charles Geiser SCHEDULE 1 Dated as of June 23, 1999 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; and State Street Bank and Trust Company, as operations agent
NAME AND ADDRESS FORM OF JURISDICTION OF PERCENTAGE OF BORROWER ORGANIZATION ORGANIZATION ALLOCATION OF FEES AND EXPENSES Small Company Growth Corporation Maryland 0.77% Portfolio - Warburg, Pincus Institutional Fund, Inc.*
466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: Warburg, Pincus Institutional Fund, Inc. By: /s/ Janna Manes --------------------------------- Name: Janna Manes Title: Vice President & Secretary STANDING INSTRUCTIONS: Account Name: Institutional - Small Company Growth Portfolio Account Number: 0367454 Bank: PNC Bank ABA No.: 031 000 053 Attn: Charles Geiser SCHEDULE 1 Dated as of June 23, 1999 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; and State Street Bank and Trust Company, as operations agent
NAME AND ADDRESS FORM OF JURISDICTION OF PERCENTAGE OF BORROWER ORGANIZATION ORGANIZATION ALLOCATION OF FEES AND EXPENSES Small Company Value Corporation Maryland 0.01% Portfolio - Warburg, Pincus Institutional Fund, Inc.*
466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: Warburg, Pincus Institutional Fund, Inc. By: /s/ Janna Manes --------------------------------- Name: Janna Manes Title: Vice President & Secretary STANDING INSTRUCTIONS: Account Name: Institutional - Small Company Value Portfolio Account Number: 0367226 Bank: PNC Bank ABA No.: 031 000 053 Attn: Charles Geiser SCHEDULE 1 Dated as of June 23, 1999 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; and State Street Bank and Trust Company, as operations agent
NAME AND ADDRESS FORM OF JURISDICTION OF PERCENTAGE OF BORROWER ORGANIZATION ORGANIZATION ALLOCATION OF FEES AND EXPENSES Value Portfolio - Corporation Maryland 0.18% Warburg, Pincus Institutional Fund, Inc.*
466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: Warburg, Pincus Institutional Fund, Inc. By: /s/ Janna Manes --------------------------------- Name: Janna Manes Title: Vice President & Secretary STANDING INSTRUCTIONS: Account Name: Institutional - Value Portfolio Account Number: 0367218 Bank: PNC Bank ABA No.: 031 000 053 Attn: Charles Geiser SCHEDULE 1 Dated as of June 23, 1999 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; and State Street Bank and Trust Company, as operations agent
NAME AND ADDRESS FORM OF JURISDICTION OF PERCENTAGE OF BORROWER ORGANIZATION ORGANIZATION ALLOCATION OF FEES AND EXPENSES Fixed Income Portfolio - Massachusetts Massachusetts 0.01% Warburg, Pincus Business Trust Trust II*
466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: Warburg, Pincus Trust II By: /s/ Janna Manes --------------------------------- Name: Janna Manes Title: Vice President & Secretary STANDING INSTRUCTIONS: Account Name: Trust II - Fixed Income Portfolio Account Number: 0367543 Bank: PNC Bank ABA No.: 031 000 053 Attn: Charles Geiser SCHEDULE 1 Dated as of June 23, 1999 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; and State Street Bank and Trust Company, as operations agent
NAME AND ADDRESS FORM OF JURISDICTION OF PERCENTAGE OF BORROWER ORGANIZATION ORGANIZATION ALLOCATION OF FEES AND EXPENSES Global Fixed Income Massachusetts Massachusetts 0.01% Portfolio - Warburg, Business Trust Pincus Trust II**
466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund Warburg, Pincus Trust II By: /s/ Janna Manes --------------------------------- Name: Janna Manes Title: Vice President & Secretary STANDING INSTRUCTIONS: Account Name: Trust II - Global Fixed Income Portfolio/THO Account Number: 27241173 Bank: State Street/Boston ABA No.: 011 000 028 Attn: Charles Geiser SCHEDULE 2 BANKS; ADDRESSES; FACILITY PERCENTAGES (1) State Street Bank and Trust Company Global Investor Credit Services Division Mutual Fund Lending Lafayette Corporate Center 2 Avenue de Lafayette, 2nd Floor Boston, MA 02111 Fax: (617) 662-2325 Attention: Edward A. Siegel, Vice President Commitment Amount: $75,000,000 Facility Percentage: 30.0% (2) Deutsche Bank AG, New York Branch 31 West 52nd Street New York, NY 10019 Fax: (212) 469-8346 Attention: Alan Krouk, Assistant Vice President Commitment Amount: $80,000,000 Facility Percentage: 32.0% (3) Bank of Nova Scotia One Liberty Plaza New York, NY 10006 Fax: (212) 225-5090 Attention: John Morale, Vice President Commitment Amount: $50,000,000 Facility Percentage: 20.0% (4) Banque Nationale de Paris 499 Park Avenue, 2rd Floor New York, NY 10022 Fax: (212) 415-9707 Attention: Ms. Marguerite L. Lebon, Assistant Vice President Commitment Amount: $45,000,000 Facility Percentage: 18.0% EXHIBIT A BORROWING REQUEST (Committed Credit Loans) TO: State Street Bank and Trust Company, as Operations Agent Lafayette Corporate Center 2 Avenue de Lafayette, 2nd Floor Boston, MA 02111 Attention: Michelle Murphy Fax: (617) 662-2324 This Borrowing Request (Committed Credit Loans) is being delivered pursuant to Section 2.04(a) of the Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT") among each investment management company listed on Schedule 1 to the Credit Agreement [as heretofore revised], on behalf of itself and its respective investment portfolios identified thereon, including the undersigned (collectively, the "BORROWERS"); the Banks listed on Schedule 2 to the Credit Agreement [as heretofore revised] (collectively, and together with State Street Bank and Trust Company, in its capacity as Swing Line Lender, the "BANKS"); Deutsche Bank AG, New York Branch, as administrative agent (the "ADMINISTRATIVE AGENT"); Bank of Nova Scotia, as syndication agent (the "SYNDICATION AGENT"); and State Street Bank and Trust Company, as operations agent (the "OPERATIONS AGENT"). Capitalized terms used herein shall have the meanings described to them in the Credit Agreement. The undersigned Borrower requests that a Committed Credit Loan be made by the Banks to such Borrower on this date in the aggregate amount set forth below: Name of Borrower: ------------------------------------------ Date of Proposed Borrowing [must be a Banking Day]: ------------------------------------------ Amount of Loan Requested: $ [$1,000,000 or an integral multiple thereof]: ------------------------------------------ In connection with the foregoing Borrowing Request, the undersigned hereby certifies to the Operations Agent and the Banks as follows: (a) The value of the Borrower's portfolio securities is $_______________, the value of the Borrower's Total Assets is $_______________, and the value of the Borrower's Net Assets is $_____________ (in each case computed as of the close of business on the previous business day of the Borrower in accordance with the terms of the Credit Agreement). [NOTE: The aggregate Indebtedness of the Borrower in respect of Loans shall at no time exceed (i) 33-1/3% of the Borrower's Net Assets, in the case of any Borrower that is a Domestic Fund, (ii) 25% of the Borrower's Net Assets, in the case of Warburg Pincus High Yield Fund, Inc., Warburg Pincus Post Venture Capital Fund, Inc., Warburg Pincus Global Post Venture Capital Fund, Inc., Warburg Pincus Post Venture Capital Portfolio of Warburg Pincus Trust, and Post Venture Capital Portfolio of Warburg Pincus Institutional Fund, Inc., and any Borrower that is an International Fund, or (iii) 20% of the Borrower's Net Assets, in the case of any Borrower that is a Restricted Fund.] (b) The Borrower's aggregate Indebtedness, including the proposed borrowing, is $____________________. (c) After giving effect to the transactions contemplated by this Borrowing Request on the date hereof, each of the conditions specified in Section 6.02 of the Credit Agreement has been fulfilled. (d) The Borrower will use the proceeds of the Committed Credit Loans requested hereby solely for the purposes permitted under Section 4.08 of the Credit Agreement. (e) The requested borrowing is permitted under the Borrower's most recent Prospectus. (f) The proceeds of this borrowing, when added to the aggregate principal amount of all Loans outstanding to the Borrower under the Credit Agreement, do not exceed the Borrower's Borrowing Base. (g) The proceeds of this borrowing, when added to the aggregate principal amount of Loans outstanding to the Borrowers under the Credit Agreement, do not exceed the Maximum Credit Amount. (h) The proceeds of this borrowing, when added to the aggregate principal amount of Committed Credit Loans outstanding to the Borrowers under the Credit Agreement, do not exceed the Maximum Committed Credit Amount. (i) The portion of the proceeds of this borrowing to be advanced by State Street Bank, when added to the aggregate outstanding principal amount of all Committed Credit Loans and Swing Line Loans made by State Street Bank to the Borrowers under the Credit Agreement, does not exceed State Street Bank's Commitment. The undersigned Borrower Agent is an Authorized Officer of the Borrower. DATE; --------------------------------- -------------------------------------- (Name of Borrower) By: ----------------------------------- Name: --------------------------------- Title: -------------------------------- -2- EXHIBIT B BORROWING REQUEST (Swing Line Loans) TO: State Street Bank and Trust Company, as Swing Line Lender Lafayette Corporate Center 2 Avenue de Lafayette, 2nd Floor Boston, MA 02111 Attention: Michelle Murphy Fax: (617) 662-2324 This Borrowing Request (Swing Line Loans ) is being delivered pursuant to Section 3.03(a) of the Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT") among each investment management company listed on SCHEDULE 1 to the Credit Agreement [as heretofore revised], on behalf of itself and its respective investment portfolios identified thereon, including the undersigned (collectively, the "BORROWERS"); the Banks listed on SCHEDULE 2 to the Credit Agreement [as heretofore revised] (collectively, and together with State Street Bank and Trust Company, in its capacity as Swing Line Lender, the "BANKS"); Deutsche Bank AG, New York Branch, as administrative agent (the "ADMINISTRATIVE AGENT"); Bank of Nova Scotia, as syndication agent (the "SYNDICATION AGENT"); and State Street Bank and Trust Company, as operations agent (the "OPERATIONS AGENT"). Capitalized terms used herein shall have the meanings described to them in the Credit Agreement. The undersigned Borrower requests that a Swing Line Loan be made by the Swing Line Lender to such Borrower on this date in the aggregate amount set forth below: Name of Borrower: ------------------------------------------ Date of Proposed Borrowing [must be a Banking Day]: ------------------------------------------ Amount of Loan Requested: $ ------------------------------------------ In connection with the foregoing Borrowing Request, the undersigned hereby certifies to the Swing Line Lender as follows: (a) The value of the Borrower's portfolio securities is $_______________, the value of the Borrower's Total Assets is $_______________, and the value of the Borrower's Net Assets is $_____________ (in each case computed as of the close of business on the previous business day of the Borrower in accordance with the terms of the Credit Agreement). [NOTE: The aggregate Indebtedness of the Borrower in respect of Loans shall at no time exceed (i) 33-1/3% of the Borrower's Net Assets, in the case of any Borrower that is a Domestic Fund, (ii) 25% of the Borrower's Net Assets, in the case of Warburg Pincus High Yield Fund, Inc., Warburg Pincus Post Venture Capital Fund, Inc., Warburg Pincus Global Post Venture Capital Fund, Inc., Warburg Pincus Post Venture Capital Portfolio of Warburg Pincus Trust, and Post Venture Capital Portfolio of Warburg Pincus Institutional Fund, Inc., and any Borrower that is an International Fund, or (iii) 20% of the Borrower's Net Assets, in the case of any Borrower that is a Restricted Fund.] (b) The Borrower's aggregate Indebtedness, including the proposed borrowing, is $____________________. (c) After giving effect to the transactions contemplated by this Borrowing Request on the date hereof, each of the conditions specified in Section 6.02 of the Credit Agreement has been fulfilled. (d) The Borrower will use the proceeds of the Swing Line Loan requested hereby solely for the purposes permitted under Section 4.08 of the Credit Agreement. (e) The requested borrowing is permitted under the Borrower's most recent Prospectus. (f) The proceeds of this borrowing, when added to the aggregate principal amount of all Loans outstanding to the Borrower under the Credit Agreement, do not exceed the Borrower's Borrowing Base. (g) The proceeds of this borrowing, when added to the aggregate principal amount of Swing Line Loans outstanding to the Borrowers under the Credit Agreement, do not exceed the Swing Line Amount. (h) The proceeds of this borrowing, when added to the aggregate principal amount of Loans outstanding to the Borrowers under the Credit Agreement, do not exceed the Maximum Credit Amount. (i) The proceeds of this borrowing, when added to the aggregate outstanding principal amount of all Committed Credit Loans and Swing Line Loans made by State Street Bank to the Borrowers under the Credit Agreement, does not exceed State Street Bank's Commitment. The undersigned Borrower Agent is an Authorized Officer of the Borrower. DATE; --------------------------------- -------------------------------------- (Name of Borrower) By: ----------------------------------- Name: --------------------------------- Title: -------------------------------- -2- EXHIBIT C REPAYMENT NOTICE (Committed Credit Loans) TO: State Street Bank and Trust Company, as Operations Agent Lafayette Corporate Center 2 Avenue de Lafayette, 2nd Floor Boston, MA 02111 Attention: Michelle Murphy Fax: (617) 662-2324 This Repayment Notice (Committed Credit Loans) is being delivered pursuant to Section 4.01(a) of the Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT") among each investment management company listed on SCHEDULE 1 to the Credit Agreement [as heretofore revised], on behalf of itself and its respective investment portfolios identified thereon, including the undersigned (collectively, the "BORROWERS"); the Banks listed on SCHEDULE 2 to the Credit Agreement [as heretofore revised] (collectively, and together with State Street Bank and Trust Company, in its capacity as Swing Line Lender, the "BANKS"); Deutsche Bank AG, New York Branch, as administrative agent (the "ADMINISTRATIVE AGENT"); Bank of Nova Scotia, as syndication agent (the "SYNDICATION AGENT"); and State Street Bank and Trust Company, as operations agent (the "OPERATIONS AGENT"). Capitalized terms used herein shall have the meanings described to them in the Credit Agreement. The undersigned Borrower hereby gives notice to the Operations Agent, on behalf of the Banks, of the repayment this date of Committed Credit Loans in the aggregate amount set forth below: Name of Borrower: ------------------------------------------ Date of Proposed Borrowing [must be a Banking Day]: ------------------------------------------ Amount of Loan Requested: $ ------------------------------------------ The undersigned Borrower Agent is an Authorized Officer of the Borrower. DATE; --------------------------------- -------------------------------------- (Name of Borrower) By: ----------------------------------- Name: --------------------------------- Title: -------------------------------- EXHIBIT D REPAYMENT NOTICE (Swing Line Loans) TO: State Street Bank and Trust Company, as Swing Line Lender Lafayette Corporate Center 2 Avenue de Lafayette, 2nd Floor Boston, MA 02111 Attention: Michelle Murphy Fax: (617) 662-2324 This Repayment Notice (Swing Line Loans) is being delivered pursuant to Section 4.01(b) of the Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT") among each investment management company listed on SCHEDULE 1 to the Credit Agreement [as heretofore revised], on behalf of itself and its respective investment portfolios identified thereon, including the undersigned (collectively, the "BORROWERS"); the Banks listed on SCHEDULE 2 to the Credit Agreement [as heretofore revised] (collectively, and together with State Street Bank and Trust Company, in its capacity as Swing Line Lender, the "BANKS"); Deutsche Bank AG, New York Branch, as administrative agent (the "ADMINISTRATIVE AGENT"); Bank of Nova Scotia, as syndication agent (the "SYNDICATION AGENT"); and State Street Bank and Trust Company, as operations agent (the "OPERATIONS AGENT"). Capitalized terms used herein shall have the meanings described to them in the Credit Agreement. The undersigned Borrower hereby gives notice to the Swing Line Lender of the repayment this date of Swing Line Loans in the aggregate amount set forth below: Name of Borrower: ------------------------------------------ Date of Proposed Borrowing [must be a Banking Day]: ------------------------------------------ Amount of Loan Requested: $ ------------------------------------------ The undersigned Borrower Agent is an Authorized Officer of the Borrower. DATE; --------------------------------- -------------------------------------- (Name of Borrower) By: ----------------------------------- Name: --------------------------------- Title: -------------------------------- EXHIBIT E DAILY VALUATION REPORT TO: State Street Bank and Trust Company, as Operations Agent, and the Banks party to that certain Credit Agreement, dated as of June 23, 1999, among the Borrowers, the Banks, the Administrative Agent, the Syndication Agent and the Operations Agent This report is being delivered pursuant to Section 8.01(d) of the Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement [as heretofore revised], on behalf of itself and its respective investment portfolios identified thereon, including the undersigned (collectively, the "BORROWERS"); the Banks listed on SCHEDULE 2 to the Credit Agreement [as heretofore revised] (collectively, and together with State Street Bank and Trust Company, in its capacity as the Swing Line Lender, the "BANKS"); Deutsche Bank AG, New York Branch, as administrative agent (the "ADMINISTRATIVE AGENT"); Bank of Nova Scotia, as syndication agent (the "SYNDICATION AGENT"); and State Street Bank and Trust Company, as operations agent (the "OPERATIONS Agent"). Capitalized terms used herein shall have the meanings ascribed to them in the Credit Agreement. The undersigned hereby certifies to the Operations Agent and the Banks as follows: (a) The value of the Borrower's portfolio securities is $_______________, the value of the Borrower's Total Assets is $_______________, and the value of the Borrower's Net Assets is $_____________ (in each case computed as of the close of business on the previous business day of the Borrower in accordance with the terms of the Credit Agreement). (b) The Borrower's aggregate Indebtedness as of the date hereof is $_____________. (c) The undersigned Borrower Agent is an authorized officer of the Borrower. DATE; --------------------------------- -------------------------------------- (Name of Borrower) By: ----------------------------------- Name: --------------------------------- Title: -------------------------------- [NOTE: THIS REPORT MUST BE FURNISHED UPON REQUEST TO ANY BANK ON ANY BANKING DAY WHEN LOANS ARE OUTSTANDING TO A BORROWER.] EXHIBIT F FORM FOR ADDITIONAL BORROWER _____________________, 199__ To: State Street Bank and Trust Company, as Operations Agent, and the Banks party to that certain Credit Agreement, dated as of June 23, 1999, among the Borrowers, the Banks, the Operations Agent, and certain other parties Ladies and Gentlemen: The undersigned [ Name of Borrower ] (the "COMPANY") hereby requests pursuant to Article XIII of the Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement [as heretofore revised], on behalf of itself and its respective investment portfolios identified thereon (collectively, the "BORROWERS"); the Banks listed on SCHEDULE 2 to the Credit Agreement [as heretofore revised] (collectively, and together with State Street Bank and Trust Company, in its capacity as Swing Line Lender, the "BANKS"); Deutsche Bank AG, New York Branch, as administrative agent (the "ADMINISTRATIVE AGENT"); Bank of Nova Scotia, as syndication agent (the "SYNDICATION AGENT"); and State Street Bank and Trust Company, as operations agent (the "OPERATIONS AGENT"), that it be admitted as an additional Borrower under the Credit Agreement and that SCHEDULE 1 to the Credit Agreement be revised in accordance with Section 4.09 of the Credit Agreement to include the Company as such in the form attached hereto which has been signed by one or more Borrower Agents on behalf of each Borrower. Capitalized terms used herein shall have the meanings ascribed to them in the Credit Agreement. The Company hereby represents and warrants to the Operations Agent and the Banks that as of the date hereof and after giving effect to the admission of the Company as an additional Borrower under the Credit Agreement: (i) the representations and warranties set forth in Article VII of the Credit Agreement with respect to the existing Borrowers are true and correct with respect to the Company after giving effect to the admission of the Company as a Borrower; (ii) the Company is in compliance in all material respects with all of the terms and provisions set forth in the Credit Agreement on its part to be observed or performed as of the date hereof and after giving effect to the admission; and (iii) no Default with respect to the Company has occurred and is continuing. The Company agrees to be bound by the terms and conditions of the Credit Agreement in all respects as a Borrower thereunder and hereby assumes all of the obligations of a Borrower thereunder. Please indicate your assent to the admission of the Company as an additional Borrower under the Credit Agreement by signing below where indicated. [NAME OF BORROWER] By: ----------------------------------- Name: --------------------------------- Title: -------------------------------- AGREED AND ACCEPTED: STATE STREET BANK AND TRUST COMPANY By: ------------------------------------ Name: ---------------------------------- Title: --------------------------------- DEUTSCHE BANK AG, NEW YORK BRANCH By: ------------------------------------ Name: ---------------------------------- Title: --------------------------------- BANK OF NOVA SCOTIA By: ------------------------------------ Name: ---------------------------------- Title: --------------------------------- BANQUE NATIONALE DE PARIS By: ------------------------------------ Name: ---------------------------------- Title: --------------------------------- STATE STREET BANK AND TRUST COMPANY, As Operations Agent By: ------------------------------------ Name: ---------------------------------- Title: --------------------------------- -2- EXHIBIT G FORM OF OPINION OF COUNSEL [ Date ] State Street Bank and Trust Company, as Operations Agent Lafayette Corporate Center 2 Avenue de Lafayette, 2nd Floor Boston, MA 02111 Ladies and Gentlemen: This opinion is being furnished to you pursuant to Article XIII of the Credit Agreement, dated as of June 23, 1999 ([as amended and in effect on the date hereof,] the "Credit Agreement") among each investment management company listed on SCHEDULE 1 to the Credit Agreement [as heretofore revised], on behalf of itself and its respective investment portfolios identified thereon, for which [ ] serves as the Investment Adviser (collectively, the "BORROWERS"); the Banks named on SCHEDULE 2 thereto [as the same has heretofore been revised through ________ (collectively, and together with State Street Bank and Trust Company, in its capacity as Swing Line Lender, the "BANKS"); Deutsche Bank AG, New York Branch, as administrative agent (the "ADMINISTRATIVE AGENT"); Bank of Nova Scotia, as syndication agent (the "SYNDICATION AGENT"); and State Street Bank and Trust Company, as operations agent (the "OPERATIONS AGENT"). [ ], a [ ] (the "[ ]"), [on behalf of [ ] ([each] a "SERIES"),] has executed a request, a copy of which is annexed hereto as EXHIBIT A (including Revision No. of SCHEDULE 1 annexed thereto, the "REQUEST") to be admitted as [an] additional Borrower[s] under the Credit Agreement. Warburg Pincus Asset Management, Inc., a [ ] corporation ("WaRBURG PINCUS ASSET MANAGEMENT") acts as Investment Adviser to the [ ]. Capitalized terms used herein without definition have the respective meanings ascribed to them in the Credit Agreement. Wherever reference is made below to "Borrowers" or a "Borrower", to the extent that any Borrower is a Series of an Investment Company, as distinguished from an Investment Company, it shall be deemed, where the context so requires, to refer to the Investment Company of which the Borrower is a Series. We have examined originals or copies, certified or otherwise identified to our satisfaction, of such trust records, documents, certificates of public officials and other instruments and have made such investigation of fact and law as we have deemed necessary or advisable to render this opinion. We have assumed that the Banks have all requisite power and authority and have taken all necessary action to admit the [ ][, on behalf of [each of] the Series,] as [an] additional Borrower[s] under the Credit Agreement in accordance with the terms thereof. Based upon and subject to the foregoing and to the qualifications hereinafter set forth, it is our opinion that: 1. The Request accurately and completely lists the full legal name of the [ ] [and [each/the] Series] and [its/the] principal business address [of the [ ] and [each/the] Series]. The [ ] is a [ ], duly organized, validly existing and in good standing under the laws of [ ], and has all requisite power and authority and all material governmental licenses, authorizations, consents and approvals required to carry on its business as now conducted and as proposed to be conducted in accordance with its Investment Practices (as hereinafter defined) to enter into [, on behalf of [each/the] Series,] the Credit Agreement, and to carry out its terms. [The [ ] is qualified to do business in The Commonwealth of Massachusetts as a foreign organization.] The [ ] is not required to qualify to do business as a foreign organization in any [other] jurisdiction of the United States of America, except for compliance with applicable state blue sky laws. 2. The [ ] is an Investment Company registered as such under the Investment Company Act of 1940, as amended, and has registered the sale of its shares of beneficial interest under the Securities Act of 1933, as amended. 3. The execution, delivery and performance by the [ ] [, on behalf of [each of] the Series,] of the Request and the Credit Agreement are within its powers, have been duly authorized by all necessary action of the [ ], require no consent, approval, authorization of, or other action by, or in respect of, or declaration or filing with, any governmental body, agency or official, other than routine filings under federal and state securities laws, and will not result in any violation of, or be in conflict with, or constitute a default under, any provision of the [charter documents/declaration of trust] or by-laws of the [ ] or [its/the] Investment Practices [of [any of] the Series], or of any provision of any agreement, instrument, judgment, decree, order, statute, rule or governmental regulation applicable to the [ ], or result in the creation or imposition of any mortgage, lien, charge or encumbrance on any asset of the [ ] [or of [any of] the Series] pursuant to any such provision. "Investment Practices", as used herein, means the investment objectives and fundamental investment policies and fundamental investment restrictions currently in effect with respect to [the Company/[each/the] Series], as set forth in its [Prospectus/Registration Statement], as amended to date, or as may be set forth in a vote adopted by the shareholders of [the Company/[the/such] Series]. The [Company/Series] [is/are] not in material violation of any provision of [its/their respective] [charter document[s]/ declaration[s] of trust] or by-laws or [its/their respective] Investment Practices, or of any agreement or instrument to which it is a party, or, to our knowledge, of any judgment, decree, order, statute, rule or governmental regulation applicable to it. Without limiting the generality of the foregoing, to our knowledge, the [ ] is in compliance in all material respects with all federal and state securities or similar laws and regulations, including all material rules, regulations and administrative orders of the SEC and applicable blue sky authorities. -2- 4. There is no action, proceeding or investigation pending or, to our knowledge, threatened (or any basis therefor known to us) against the [ ] [or [the/any] Series] which questions the validity of the Credit Agreement as to the [ ] [or [the/any] Series], or any action taken or to be taken pursuant thereto, in which there is a reasonable possibility of an adverse decision and which could, either in any case or in the aggregate, materially affect adversely the ability of the [ ] [, on behalf of [each of] the Series,] to perform its obligations thereunder. 5. The Request and the Credit Agreement have been duly executed and delivered by the [ ] [, on behalf of [each of] the Series,] and the Credit Agreement constitutes the legal, valid and binding obligation of the [ ] [, on behalf of [each of] the Series,] enforceable against it in accordance with its terms. 6. Based on the covenants, representations and warranties contained in the Credit Agreement as to the use of the proceeds of the Loans, such proceeds will not be used for any purpose which might cause the Credit Agreement to violate the provisions of Regulation U of the Board of Governors of the Federal Reserve System. The opinions expressed above are qualified to the extent that the enforceability of any provision of the Credit Agreement with respect to the [ ][, on behalf of [each of] the Series,] or any rights granted pursuant thereto or obligations incurred thereunder, may be subject to and affected by: (a) applicable bankruptcy, receivership, insolvency, reorganization, moratorium and similar laws from time to time in effect affecting the rights of creditors generally; and such duties and standards as are or may be imposed on creditors, including, without limitation, good faith, reasonableness and fair dealing under applicable law; and (b) general principles of equity (regardless of whether such enforceability is considered in a proceeding in equity or at law) and the exercise of equitable powers by a court of competent jurisdiction. We call to your attention that the officer of the [ ] executing the Request and the Credit Agreement [, on behalf of [each of] the Series,] is signing such documents not individually but in his capacity as an officer of the [ ] and that the obligations of the [ ] [, on behalf of [each of] the Series,] under the Credit Agreement are not binding upon any of the [Trustees/Directors], officers, agents, employees or shareholders of the [ ] individually, but bind only the assets of the [ ][Series] on whose behalf the Credit Agreement has been executed.. We also call to your attention to the fact that each Borrower that is an Investment Company is liable pursuant to the Credit Agreement only to the extent of its proportionate borrowings thereunder and shall not be liable for any obligations thereunder of a different -3- Investment Company. Moreover, each Borrower that is a Series of an Investment Company is liable pursuant to the Credit Agreement only to the extent of its proportionate borrowings under the Credit Agreement and shall not be liable for any obligations thereunder of a different Series of the same or a different Investment Company. We further call your attention to the fact that the Investment Practices of certain of the Borrowers may restrict the borrowing by them under the Credit Agreement to amounts less than the Maximum Committed Credit Amount and the Maximum Credit Amount. This opinion applies only to the laws of [ ] and the federal laws of the United States of America and relates only to the matters expressly addressed above. We express no opinion with respect to any other matters. This opinion is rendered only to the Operations Agent and the Banks and is solely for the benefit of the Operations Agent and the Banks in connection with the transactions contemplated by the Credit Agreement, may not be relied upon by the Operations Agent or the Banks for any other purpose, and may not be furnished or quoted to, or relied upon by, any other Person for any purpose without our prior written consent. Very truly yours, [ ] -4- EXHIBIT H ASSIGNMENT AND ACCEPTANCE Dated as of __________, 19__ Reference is made to the Credit Agreement, dated as of June 23, 1999 (as from time to time amended and in effect, the "CREDIT AGREEMENT"), by and among each investment management company listed on SCHEDULE 1 to the Credit Agreement [as heretofore revised], on behalf of itself and its respective investment portfolios identified thereon (collectively, the "BORROWERS" and each individually a "BORROWER"); the Banks listed on SCHEDULE 2 attached thereto, as revised from time to time (collectively, and together with State Street Bank and Trust Company, in its capacity as Swing Line Lender, the "BANKS" and each individually a "BANK"); Deutsche Bank AG, New York Branch, as administrative agent (the "ADMINISTRATIVE AGENT"); Bank of Nova Scotia, as syndication agent (the "SYNDICATION AGENT"); and State Street Bank and Trust Company, as operations agent (the "OPERATIONS AGENT"). Capitalized terms used herein and not otherwise defined shall have the meanings assigned to such terms in the Credit Agreement. [ ] (the "ASSIGNOR") and [ ] (the "ASSIGNEE") hereby agree as follows: 1. ASSIGNMENT. Subject to the terms and conditions of this Assignment and Acceptance, the Assignor hereby sells and assigns to the Assignee, and the Assignee hereby purchases and assumes without recourse to the Assignor, a $____________ interest in and to the rights, benefits, indemnities and obligations of the Assignor under the Credit Agreement equal to _____.00% in respect of the Maximum Committed Credit Amount immediately prior to the Effective Date (as hereinafter defined). 2. ASSIGNOR'S REPRESENTATIONS. The Assignor (i) represents and warrants that (A) it is legally authorized to enter into this Assignment and Acceptance, (B) as of the date hereof, its Commitment is $______________, its Facility Percentage is _____.00%, and the aggregate outstanding principal balance of its Committed Credit Loans equals $____________ (in each case after giving effect to the assignment contemplated hereby but without giving effect to any contemplated assignments which have not yet become effective), and (C) immediately after giving effect to all assignments which have not yet become effective, the Assignor's Facility Percentage will be sufficient to give effect to this Assignment and Acceptance; (ii) makes no representation or warranty, express or implied, and assumes no responsibility with respect to any statements, warranties or representations made in or in connection with the Credit Agreement or any of the other Loan Documents, or the execution, legality, validity, enforceability, genuineness, sufficiency or value of the Credit Agreement, the other Loan Documents or any other instrument or document furnished pursuant thereto, other than that it is the legal and beneficial owner of the interest being assigned by it hereunder free and clear of any claim or encumbrance; and (iii) makes no representation or warranty and assumes no responsibility with respect to the financial condition of any Borrower or any other Person primarily or secondarily liable in respect of any of the obligations of the Borrowers under or in respect of the Credit Agreement, the other Loan Documents, and any other instrument or document executed and/or delivered pursuant thereto, including, without limitation, the Loans (the "OBLIGATIONS"), or the performance or observance by any Borrower or any other Person primarily or secondarily liable in respect of any of the Obligations. 3. ASSIGNEE'S REPRESENTATIONS. The Assignee (i) represents and warrants that (A) it is duly and legally authorized to enter into this Assignment and Acceptance, (B) the execution, delivery and performance of this Assignment and Acceptance do not conflict with any provision of law or of the charter or by-laws of the Assignee, or of any agreement binding on the Assignee, (C) all acts, conditions and things required to be done and performed and to have occurred prior to the execution, delivery and performance of this Assignment and Acceptance, and to render the same the legal, valid and binding obligation of the Assignee, enforceable against it in accordance with its terms, have been done and performed and have occurred in due and strict compliance with all applicable laws; (ii) confirms that it has received a copy of the Credit Agreement, together with copies of the most recent financial statements delivered pursuant to Section 8.01 thereof and such other documents and information as it has deemed appropriate to make its own credit analysis and decision to enter into this Assignment and Acceptance; (iii) agrees that it will, independently and without reliance upon the Assignor, the Operations Agent or any other Bank and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit decisions in taking or not taking action under the Credit Agreement; (iv) represents and warrants that it meets the criteria of an eligible assignee set forth in subsection 15.07(c) of the Credit Agreement; (v) appoints and authorizes the Operations Agent to take such action as agent on its behalf and to exercise such powers under the Credit Agreement and the other Loan Documents as are delegated to the Operations Agent by the terms thereof, together with such powers as are reasonably incidental thereto; and (vi) agrees that it will perform in accordance with their terms all the obligations which by the terms of the Credit Agreement are required to be performed by it as a Bank. 4. EFFECTIVE DATE. The effective date for this Assignment and Acceptance shall be ___________________ (the "EFFECTIVE DATE"). Following the execution of this Assignment and Acceptance and the consent of the Borrowers hereto having been obtained, each party hereto shall deliver its duly executed COUNTERPART hereof to the Operations Agent for acceptance by the Operations Agent, together with a certified bank check in the amount of $3,000 payable to the order of the Operations Agent. [SCHEDULE 2 to the Credit Agreement shall thereupon be replaced as of the Effective Date by the SCHEDULE 2 annexed hereto]. 5. RIGHTS UNDER CREDIT AGREEMENT. Upon such acceptance and recording, from and after the Effective Date, (i) the Assignee shall be a party to the Credit Agreement and, to the extent provided in this Assignment and Acceptance, have the rights and obligations of a Bank thereunder, and (ii) the Assignor shall, with respect to that portion of its interest under the Credit Agreement assigned hereunder, relinquish its rights and be released from its obligations under the Credit Agreement; PROVIDED, HOWEVER, that the Assignor shall retain its rights to be indemnified pursuant to Section 15.12 of the Credit Agreement with respect to any claims or actions arising prior to the Effective Date. 6. PAYMENTS. Upon such acceptance of this Assignment and Acceptance by the Operations Agent, from and after the Effective Date, the Operations Agent shall make all payments in respect of the rights and interests assigned hereby (including payments of principal, interest, fees and other amounts) to the Assignee. The Assignor and the Assignee shall make any appropriate adjustments in payments for periods prior to the Effective Date by the Operations Agent or with respect to the making of this assignment directly between themselves. 7. GOVERNING LAW. THIS ASSIGNMENT AND ACCEPTANCE IS INTENDED TO TAKE EFFECT AS A SEALED INSTRUMENT TO BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE [ ] OF [ ] (WITHOUT REFERENCE TO THE CONFLICT OF LAWS PRINCIPLES THEREOF). 8. COUNTERPARTS. This Assignment and Acceptance may be executed in any number of counterparts which shall together constitute but one and the same agreement. IN WITNESS WHEREOF, intending to be legally bound, each of the undersigned has caused this Assignment and Acceptance to be executed on its behalf by its officer thereunto duly authorized, as of the date first above written. [ ] By: ------------------------------------ Name: ---------------------------------- Title: --------------------------------- [ ] By: ------------------------------------ Name: ---------------------------------- Title: --------------------------------- CONSENTED TO: - ------------- [ ] By: ------------------------------------ Name: ---------------------------------- Title: --------------------------------- [ ] By: ------------------------------------ Name: ---------------------------------- Title: --------------------------------- [ ] -3- [ ] By: ------------------------------------ Name: ---------------------------------- Title: --------------------------------- -4- EX-99.13(E) 6 0006.txt FIRST AMENDMENT TO CREDIT AGREEMENT FIRST AMENDMENT TO CREDIT AGREEMENT This First Amendment to Credit Agreement (this "FIRST AMENDMENT") is entered into as of this 21st day of June, 2000, by and among each investment management company listed on Schedule 1 to the Credit Agreement, dated as of June 23, 1999 (the "CREDIT AGREEMENT"), as heretofore revised and as further revised by this First Amendment, on behalf of itself or its respective investment portfolios identified thereon, severally and not jointly (collectively, the "BORROWERS", and each individually a "BORROWER"); the Banks listed on Schedule 2 to the Credit Agreement, as revised by this First Amendment (collectively, and together with State Street Bank and Trust Company, in its capacity as Swing Line Lender, the "BANKS", and each individually a "BANK"); Deutsche Bank AG, New York Branch, not individually but in its separate capacity as administrative agent for the Banks under the Credit Agreement (in such capacity, the "ADMINISTRATIVE AGENT"); The Bank of Nova Scotia, not individually but in its separate capacity as syndication agent for the Banks under the Credit Agreement (in such capacity, the "SYNDICATION AGENT"); BNP Paribas, not individually but in its separate capacity as documentation agent for the Banks under the Credit Agreement (in such capacity, the "DOCUMENTATION AGENT"); and State Street Bank and Trust Company, not individually but in its separate capacity as operations agent for the Banks under the Credit Agreement (in such capacity, the "OPERATIONS AGENT", and, together with the Administrative Agent, the Syndication Agent and the Documentation Agent, the "AGENTS"). Unless otherwise indicated or unless the context otherwise requires, capitalized terms used herein and not otherwise defined shall have the respective meanings provided such terms in the Credit Agreement, as amended by this First Amendment. RECITALS WHEREAS, certain of the Borrowers (the "EXISTING Borrowers"), certain of the Banks (the "EXISTING BANKS"), the Administrative Agent, the Syndication Agent and the Operations Agent previously executed the Credit Agreement; WHEREAS, the Borrowers, the Existing Banks, the Administrative Agent, the Syndication Agent and the Operations Agent wish to amend the Credit Agreement to increase the Maximum Committed Credit Amount by One Hundred Million Dollars ($100,000,000) to Three Hundred Fifty Million Dollars ($350,000,000), and to increase the Swing Line Amount by Twenty-Five Million ($25,000,000) to Seventy-Five Million Dollars ($75,000,000); WHEREAS, the Borrowers desire to renew the credit facilities made available to them under the Credit Agreement for an additional term of 364 days; and WHEREAS, the Existing Banks, the Administrative Agent, the Syndication Agent and the Operations Agent are willing to renew the credit facilities made available thereby upon the terms and subject to the conditions set forth herein; WHEREAS, the Existing Borrowers and the Existing Banks desire to further amend the Credit Agreement to add Emerging Growth Trust, an investment portfolio of Warburg Pincus Trust (the "ADDITIONAL BORROWER"), as a party thereto; WHEREAS, the Borrowers, the Existing Banks, the Administrative Agent, the Syndication Agent and the Operations Agent wish to amend the Credit Agreement to add Credit Lyonnais New York Branch and Den Danske Bank as bank(s) party thereto, and to add BNP Paribas as documentation agent for the Banks; WHEREAS, the parties hereto desire to make certain other changes to the Credit Agreement; NOW, THEREFORE, in furtherance of the foregoing, and in consideration of mutual promises and other good and valuable consideration each to the other given, the receipt of which is hereby acknowledged, the parties hereto agree as follows: SECTION 1. AMENDMENTS TO CREDIT AGREEMENT. (a) Section 1.01 of the Credit Agreement is hereby amended by: (i) deleting the definitions of "FEDERAL FUNDS EFFECTIVE RATE", "MAXIMUM COMMITTED CREDIT AMOUNT", "MAXIMUM CREDIT AMOUNT" and "SWING LINE AMOUNT" in their entirety; and (ii) substituting in lieu thereof the following: "FEDERAL FUNDS EFFECTIVE RATE" shall mean, at the relevant time of reference thereto, the rate that appears in Bloomberg, page BTMM, as the "Federal Funds Offered Rate", as quoted by Garvin Guy Butler as of 9:30 a.m. (New York time), or, if unavailable, by any other federal funds broker of recognized standing as determined by the Operations Agent. "MAXIMUM COMMITTED CREDIT AMOUNT" shall mean the maximum amount of the Banks' commitments to make Committed Credit Loans to the Borrowers hereunder, which in the first instance shall be $350,000,000, as the same may be reduced from time to time pursuant to Section 2.02 hereof. "MAXIMUM CREDIT AMOUNT" shall mean the maximum amount of credit available to the Borrowers hereunder, which in the first instance shall be $350,000,000, as the same may be reduced from time to time pursuant to Section 2.02 hereof. "SWING LINE AMOUNT" shall mean the maximum amount of Swing Line Loans made or to be made by the Swing Line Lender to the Borrowers hereunder, which shall be $75,000,000." (b) Section 1.01 of the Credit Agreement is further amended by inserting the following defined terms in proper alphabetical order: "CLOSED-END FUND" shall mean any Borrower designated as such on Schedule 1 annexed hereto, which designation shall be concurred in by the Agents. "FACILITY FEE" shall have the meaning specified in Section 5.01(a) hereof" (c) Section 1.01 of the Credit Agreement is still further amended by deleting the definitions of "COMMITMENT FEE" and "YEAR 2000 PROBLEM" in their entirety. -2- (d) Section 5.01(a) of the Credit Agreement is hereby amended by: (i) deleting said Section 5.01(a) in its entirety; and (ii) substituting in lieu thereof the following: "(a) The Borrowers shall pay to the Operations Agent for the ratable benefit of the Banks, and in accordance with the Specified Percentages, a facility fee (the "FACILITY FEE") for the period commencing June 21, 2000 to and including the termination of the Commitments hereunder equal to seven and one-half (7-1/2) basis points (75/1000 of 1%) per annum of the Maximum Committed Credit Amount regardless of usage. The Facility Fee shall be payable quarterly in arrears on the fifteenth Banking Day of each April, July, October and January of each year for the calendar quarter ending as of the last day of the immediately preceding month, commencing on the first such date next succeeding the date hereof, and, in connection with the partial reduction of the Maximum Committed Credit Amount in accordance with Section 2.02(a) hereof, on the date of such reduction, and on the date of any termination of any of the Commitments." (e) Section 5.01 of the Credit Agreement is further amended by: (i) deleting all references to "Commitment Fee" and "Commitment Fees" contained therein (including in the heading thereof); and (ii) substituting in lieu thereof "Facility Fee" and "Facility Fees", as appropriate. (f) Section 5.02 of the Credit Agreement is amended by: (i) deleting the first sentence of said Section 5.02; and (ii) substituting in lieu thereof the following: "The Borrowers shall pay, in accordance with the Specified Percentages, the Operations Agent for its own account a fee (the "OPERATIONS AGENT'S FEE") in an amount to be agreed upon by the Borrowers and the Operations Agent." (g) Section 5.03 of the Credit Agreement is amended by: (i) deleting said Section 5.03 in its entirety; and (ii) substituting in lieu thereof the following: "Section 5.03. Arranging Fee. The Borrowers shall pay, in accordance with the Specified Percentages, the Administrative Agent for its own account a fee (the "Arranging Fee") in an amount to be agreed upon by the Borrowers and the Administrative Agent. The Arranging Fee shall be payable annually in advance on the date of this Agreement and on the effective date of any renewal of the Commitments pursuant to Article XIV hereof." (h) Section 5.04 of the Credit Agreement is amended by: (i) deleting said Section 5.04 in its entirety; and (ii) substituting in lieu thereof the following: "Section 5.04. ALLOCATION FEE. The Borrowers shall pay, in accordance with the Specified Percentages, the Operations Agent for the ratable benefit of the Banks an allocation fee (the "ALLOCATION FEE") in an amount equal to two and one-half (2-1/2) basis points (25/1000 of 1%) of the aggregate Commitments. The Allocation Fee shall be payable annually in advance on the date of this Agreement and on the effective date of any renewal of the Commitments pursuant to Article XIV hereof." -3- (i) Article VII of the Credit Agreement is amended by: (i) deleting Section 7.18 of said Article VII in its entirety; and (ii) renumbering Section 7.19 as Section 7.18. (j) Section 9.01(b) of the Credit Agreement is amended by: (i) deleting said Section 9.01(b) in its entirety; and (ii) substituting in lieu thereof the following: "(b) The aggregate Indebtedness of the Borrower in respect of Loans shall at no time exceed (i) 33-1/3% of the Borrower's Net Assets, in the case of any Borrower that is a Domestic Fund, (ii) 25% of the Borrower's Net Assets, in the case of Warburg Pincus Global Post Venture Capital Fund, Inc., Warburg Pincus Global Health Sciences Fund, Inc., Warburg Pincus High Yield Fund, Inc., and Global Post Venture Capital Portfolio of Warburg Pincus Trust, and any Borrower that is an International Fund, (iii) 20% of the Borrower's Net Assets, in the case of any Borrower that is a Restricted Fund, and (iv) 15% of the Borrower's Net Assets, in the case of any Borrower that is a Closed-End Fund. The lesser of the amounts determined with respect to the Borrower pursuant to paragraphs (a) or (b) of this Section 9.01 is sometimes referred to herein as the Borrower's "Borrowing Base."" (k) Section 15.07(c) of the Credit Agreement is amended by: (i) deleting the sixth line of said Section 15.07(c); and (ii) substituting in lieu thereof the following: "$5,000,000, and shall be to a banking or other financial institution or other entity not otherwise prohibited from so acting under the Investment Company Act and having a combined capital and surplus of at least...." (l) The Credit Agreement is further amended by: (i) deleting all references in the Credit Agreement, including, without limitation, Sections 2.02(a), 2.02(b), 4.02(a), 4.02(f), 4.09, 10.01, 14.02 and 15.02(a) thereof, to "Commitment Fee" and "Commitment Fees"; and (ii) substituting in lieu thereof "Facility Fee" and "Facility Fees", as appropriate. (m) SCHEDULE 1 to the Credit Agreement is hereby amended to, among other things, add Emerging Growth Portfolio, a Portfolio of Warburg Pincus Trust, as a Borrower under the Credit Agreement, and to eliminate Fixed Income Portfolio and Global Fixed Income Portfolio, each being a Portfolio of Warburg Pincus Trust II, as Borrowers under the Credit Agreement by: (i) deleting said SCHEDULE 1 in its entirety; and (ii) substituting in lieu thereof SCHEDULE 1 annexed hereto. (n) SCHEDULE 2 to the Credit Agreement is hereby amended by: (i) deleting said SCHEDULE 2 in its entirety; and (ii) substituting in lieu thereof SCHEDULE 2 annexed hereto. (o) EXHIBITS A, B and F annexed to the Credit Agreement are hereby amended to make certain changes therein consistent with this First Amendment by: (i) deleting said EXHIBITS A, B and F in their entirety; and (ii) substituting in lieu thereof EXHIBITS A, B and C annexed hereto. -4- SECTION 2. REPRESENTATIONS AND WARRANTIES. In order to induce the Banks and the Agents to enter into this First Amendment, each Borrower, severally and not jointly, makes the following representations and warranties, all of which shall survive the execution and delivery of this First Amendment: (a) The Borrower has adequate power and authority to execute and deliver this First Amendment and the other agreements, documents and instruments executed in connection herewith or contemplated hereby, and to perform its obligations hereunder and under the Credit Agreement as amended hereby. (b) The execution, delivery and performance of this First Amendment and the other agreements, documents and instruments executed and delivered in connection herewith or contemplated hereby have been duly authorized by all necessary action on the part of the Borrower, will not result in a violation of or be in conflict with or constitute a default under any term of the Prospectus of the Borrower, or of its charter, articles of association, declaration of trust or by-laws, or of any investment, borrowing or other similar type of policy or restriction to which the Borrower is subject, or of any agreement, instrument, judgment, decree, order, statute, rule or governmental regulation applicable to the Borrower, or result in the creation of any mortgage, lien, charge or encumbrance upon any of the properties or assets of the Borrower pursuant to any such term. (c) This First Amendment effectively amends the Credit Agreement in accordance with the terms hereof. The obligations of the Borrower hereunder and under the Credit Agreement as amended hereby constitute the legal, valid and binding obligations of the Borrower enforceable against the Borrower in accordance with their respective terms. (d) All of the representations and warranties made by the Borrower in the Credit Agreement, including those in Article VII thereof, are true and correct on the date hereof as if made on and as of the date hereof and are so repeated herein, except that representations and warranties of financial statements or conditions as of an earlier date relate solely to such earlier date. (e) Upon the execution and delivery of this First Amendment and the other agreements, documents and instruments executed in connection herewith or contemplated hereby, and the satisfaction of each of the conditions precedent set forth in Section 3 of this First Amendment, no Default shall exist and be continuing. SECTION 3. CONDITIONS PRECEDENT. The agreements contained herein and the amendments contemplated hereby shall become effective on the date when all of the parties hereto shall have executed a copy hereof and shall have delivered the same to the Banks and the Operations Agent, and when each of the following conditions shall have been fulfilled: (a) The Operations Agent shall have received from each Borrower, with sufficient copies for each Bank, copies of all resolutions of such Borrower's Board of Trustees or Board of Directors, as applicable, authorizing (i) its execution and delivery of this First Amendment, and (ii) its performance of all of its agreements and obligations hereunder and under the Credit Agreement as amended hereby, certified by the Secretary or Assistant Secretary of the Borrower; -5- (b) The Operations Agent shall have received for itself and each of the other Banks a duly completed and executed Federal Reserve Form F.R. U-1 from each Borrower; (c) The Banks and the Operations Agent shall have received from counsel to the Borrowers an opinion(s) addressed to the Banks and the Operations Agent, dated the date hereof, which opinion(s) shall be in form and substance satisfactory to the Banks and the Operations Agent. (d) The Operations Agent and the Banks shall be satisfied that there has been no material adverse change in the business, assets, operations, prospects or condition (financial or otherwise) of any Borrower since the date of the latest financial statements delivered to the Operations Agent and the Banks pursuant to Section 7.02 or 8.01 of the Credit Agreement; (e) Without, in any way, limiting the scope of paragraph (d) above, the Operations Agent and the Banks shall be satisfied that there has been no material adverse change in any law, rule, regulation, decree or order of any governmental authority binding upon any Borrower or otherwise applicable to the Operations Agent, the Banks or any Borrower; (f) The Operations Agent shall have received from the Borrowers, on behalf of and in trust for each Bank, all accrued and unpaid Commitment Fees (as such term is defined in the Credit Agreement) and all accrued and unpaid interest owing to each Bank under the Credit Agreement calculated as of the date of this First Amendment; (g) Each Borrower shall have performed and complied in all material respects with all terms and conditions herein required to be performed or complied with by it on or prior to the date hereof, and the consummation of the transactions on the date hereof shall not result in a Default; (h) The Operations Agent shall have received from each Borrower, with sufficient copies for each Bank, a certificate dated as of the date of this First Amendment, in form and substance satisfactory to the Banks and the Operations Agent, in which such Borrower shall represent and warrant to the Banks and the Operations Agent all matters set forth in Section 2 hereof and shall represent and warrant to the Banks and the Operations Agent that the conditions precedent set forth in paragraph (g) of this Section 3 are satisfied at and as of the date of this First Amendment; (i) The Operations Agent shall have received the Operations Agent's Fee from the Borrowers as provided in Section 5.02 of the Credit Agreement, as amended by this First Amendment; (j) The Administrative Agent shall have received the Arranging Fee from the Borrowers as provided in Section 5.03 of the Credit Agreement, as amended by this First Amendment; (k) The Operations Agent shall have received for the ratable benefit of the Banks the Allocation Fee from the Borrowers as provided in Section 5.04 of the Credit Agreement, as amended by this First Amendment; -6- (l) The Banks and the Operations Agent shall have received all other information and documents which any of them may reasonably have requested in connection with the transactions contemplated hereunder and under the Credit Agreement as amended hereby, such information and documents, where appropriate, to be certified by the proper officers of each Borrower or by governmental authorities. SECTION 4. RATIFICATION OF EXISTING AGREEMENTS, ETC. All obligations of each Borrower to the Banks and the Agents under or in respect of the Credit Agreement and the other Loan Documents, except as otherwise expressly modified or contemplated to be modified in this First Amendment, are hereby ratified and confirmed in all respects, and as so ratified and confirmed constitute legal, valid and binding obligations of the Borrowers enforceable against the Borrowers in accordance with their respective terms. By executing this First Amendment, each Borrower, the Banks and the Agents agree to waive the notice requirement of Section 14.01 of the Credit Agreement, and agree to the renewal of the Commitments as amended hereby for a new 364-day period ending June 20, 2001, which shall be an "Expiration Date" as defined in Section 14.01 of the Credit Agreement, as amended hereby. Each Borrower, the Banks and the Agents further agree that each Loan outstanding to a Borrower under the Credit Agreement as of the date hereof shall be deemed to be a Loan outstanding to such Borrower under the Credit Agreement as amended by this First Amendment. Furthermore, by its execution of this First Amendment the Additional Borrower agrees to be bound by the terms and conditions of the Credit Agreement, as amended hereby, in all respects as a Borrower thereunder and hereby assumes all of the obligations of a Borrower thereunder. SECTION 5. MISCELLANEOUS. (a) This First Amendment may be executed on separate counterparts by the parties hereto, each of which when so executed and delivered shall be an original, but all of which shall constitute one and the same agreement. (b) This First Amendment and the rights and obligations of the parties hereunder shall be construed in accordance with and be governed by the laws of the State of New York (without giving effect to the conflict of laws principles thereof). (c) The headings of the several sections of this First Amendment are inserted for convenience only and shall not in any way effect the meaning or construction of any provision of this First Amendment. (d) This First Amendment and each of the other agreements, documents and instruments executed and delivered in connection herewith or contemplated hereby constitute Loan Documents under and as defined in the Credit Agreement. SECTION 6. LIMITATION OF LIABILITY. Notice is hereby given that this First Amendment has been executed by an officer of each Borrower, in that capacity and not individually. The Banks acknowledge that the obligations of or arising out of this First Amendment and the Credit Agreement, as amended hereby, are not binding upon any of the Borrowers' trustees, directors, officers, employees, agents or shareholders individually, but are binding solely upon the assets and property of the Borrowers. Notwithstanding any other provision of this First Amendment, -7- the Credit Agreement, as amended hereby, or any other Loan Document to the contrary, to the extent that this First Amendment is executed by an Investment Company on behalf of one or more Portfolios of such Investment Company, as a Borrower(s) hereunder, the Banks further acknowledge that the obligations of or arising out of this First Amendment and the Credit Agreement, as amended hereby, are binding upon the assets and property of the Portfolio on whose behalf an Investment Company has executed this instrument and that, with respect to each such Portfolio, such obligations are several but not joint. Without limiting the foregoing, the obligations of the Borrowers are several, not joint. This First Amendment shall be deemed to constitute a separate agreement between each Borrower and the other parties hereto (other than the other Borrowers) as if such Borrower had executed a separate agreement naming only itself and the other parties hereto (other than the other Borrowers) as parties. No Borrower shall be liable for the obligations (whether for principal, interest, fees, expenses or otherwise) of any other Borrower hereunder. In the case of each Borrower that is an Investment Company organized as a Massachusetts business trust or Portfolio of such an Investment Company, the declarations of trust for each such trust refer to the trustees collectively as trustees and not as individuals personally, and the declarations of trust provide that no shareholder, trustee, officer, employee or agent of the trust shall be subject to claims against or obligations of the trust to any extent whatsoever, but that the trust estate only shall be liable. IN WITNESS WHEREOF, the parties hereto have executed this First Amendment as a sealed instrument as of the day and year first above written. WARBURG PINCUS CAPITAL WARBURG PINCUS EMERGING APPRECIATION FUND GROWTH FUND, INC By: By: --------------------------------------------------- --------------------------------------------------------- Name: Name: ------------------------------------------------- ------------------------------------------------------- Title: Title: ------------------------------------------------ ------------------------------------------------------ WARBURG PINCUS INTERNATIONAL WARBURG PINCUS INTERNATIONAL EQUITY FUND, INC. SMALL COMPANY FUND, INC. By: By: --------------------------------------------------- --------------------------------------------------------- Name: Name: ------------------------------------------------- ------------------------------------------------------- Title: Title: ------------------------------------------------ ------------------------------------------------------
-8- WARBURG PINCUS JAPAN WARBURG PINCUS JAPAN SMALL COMPANY FUND, INC. GROWTH FUND, INC. By: By: --------------------------------------------------- --------------------------------------------------------- Name: Name: ------------------------------------------------- ------------------------------------------------------- Title: Title: ------------------------------------------------ ------------------------------------------------------ WARBURG PINCUS EMERGING MARKETS WARBURG PINCUS MAJOR FUND, INC. FOREIGN MARKETS FUND, INC. By: By: --------------------------------------------------- --------------------------------------------------------- Name: Name: ------------------------------------------------- ------------------------------------------------------- Title: Title: ------------------------------------------------ ------------------------------------------------------ WARBURG PINCUS SMALL WARBURG PINCUS SMALL COMPANY VALUE FUND, INC. COMPANY GROWTH FUND, INC. By: By: --------------------------------------------------- --------------------------------------------------------- Name: Name: ------------------------------------------------- ------------------------------------------------------- Title: Title: ------------------------------------------------ ------------------------------------------------------ WARBURG PINCUS GLOBAL WARBURG PINCUS GLOBAL POST VENTURE CAPITAL FUND, INC. HEALTH SCIENCES FUND, INC. By: By: --------------------------------------------------- --------------------------------------------------------- Name: Name: ------------------------------------------------- ------------------------------------------------------- Title: Title: ------------------------------------------------ ------------------------------------------------------ WARBURG PINCUS FIXED INCOME WARBURG PINCUS GLOBAL FUND FIXED INCOME FUND, INC By: By: --------------------------------------------------- --------------------------------------------------------- Name: Name: ------------------------------------------------- ------------------------------------------------------- Title: Title: ------------------------------------------------ ------------------------------------------------------
-9- WARBURG PINCUS INTERMEDIATE WARBURG PINCUS BALANCED MATURITY GOVERNMENT FUND, INC. FUND, INC. By: By: --------------------------------------------------- --------------------------------------------------------- Name: Name: ------------------------------------------------- ------------------------------------------------------- Title: Title: ------------------------------------------------ ------------------------------------------------------ WARBURG PINCUS VALUE FUND, INC. WARBURG PINCUS NEW YORK INTERMEDIATE MUNICIPAL FUND By: By: --------------------------------------------------- --------------------------------------------------------- Name: Name: ------------------------------------------------- ------------------------------------------------------- Title: Title: ------------------------------------------------ ------------------------------------------------------ WARBURG PINCUS GLOBAL CREDIT SUISSE INSTITUTIONAL TELECOMMUNICATIONS FUND, INC. INTERNATIONAL GROWTH FUND, INC. By: By: --------------------------------------------------- --------------------------------------------------------- Name: Name: ------------------------------------------------- ------------------------------------------------------- Title: Title: ------------------------------------------------ ------------------------------------------------------ WARBURG PINCUS HIGH YIELD WARBURG PINCUS MUNICIPAL FUND, INC. BOND FUND, INC. By: By: --------------------------------------------------- --------------------------------------------------------- Name: Name: ------------------------------------------------- ------------------------------------------------------- Title: Title: ------------------------------------------------ ------------------------------------------------------ CREDIT SUISSE INSTITUTIONAL WARBURG PINCUS EUROPEAN EQUITY STRATEGIC GLOBAL FIXED INCOME FUND, INC. FUND, INC. By: By: --------------------------------------------------- --------------------------------------------------------- Name: Name: ------------------------------------------------- ------------------------------------------------------- Title: Title: ------------------------------------------------ ------------------------------------------------------
-10- CREDIT SUISSE INSTITUTIONAL U.S. WARBURG PINCUS LONG-SHORT MARKET CORE FIXED INCOME FUND, INC. NEUTRAL FUND, INC. By: By: --------------------------------------------------- --------------------------------------------------------- Name: Name: ------------------------------------------------- ------------------------------------------------------- Title: Title: ------------------------------------------------ ------------------------------------------------------ WARBURG PINCUS FOCUS FUND, INC CREDIT SUISSE INSTITUTIONAL U.S. CORE EQUITY FUND, INC. By: By: --------------------------------------------------- --------------------------------------------------------- Name: Name: ------------------------------------------------- ------------------------------------------------------- Title: Title: ------------------------------------------------ ------------------------------------------------------ CREDIT SUISSE INSTITUTIONAL WARBURG PINCUS TRUST, on behalf of International Equity FUND, INC., on behalf of International Equity Portfolio, Small Company Growth Portfolio, Emerging Markets Portfolio, Small Company Growth Portfolio, Portfolio, Global Post-Venture Capital Portfolio, Value Emerging Markets Portfolio, Value Portfolio, Portfolio, and Emerging Growth Portfolio Japan Growth Portfolio, and Small Company Value Portfolio By: By: --------------------------------------------------- --------------------------------------------------------- Name: Name: ------------------------------------------------- ------------------------------------------------------- Title: Title: ------------------------------------------------ ------------------------------------------------------ THE BRAZILIAN EQUITY FUND, INC. THE CHILE FUND, INC. By: By: --------------------------------------------------- --------------------------------------------------------- Name: Name: ------------------------------------------------- ------------------------------------------------------- Title: Title: ------------------------------------------------ ------------------------------------------------------
-11- THE EMERGING MARKETS THE EMERGING MARKETS TELECOMMUNICATIONS FUND, INC. INFRASTRUCTURE FUND, INC. By: By: --------------------------------------------------- --------------------------------------------------------- Name: Name: ------------------------------------------------- ------------------------------------------------------- Title: Title: ------------------------------------------------ ------------------------------------------------------ THE FIRST ISRAEL FUND, INC. THE INDONESIA FUND, INC. By: By: --------------------------------------------------- --------------------------------------------------------- Name: Name: ------------------------------------------------- ------------------------------------------------------- Title: Title: ------------------------------------------------ ------------------------------------------------------ THE LATIN AMERICA EQUITY THE LATIN AMERICA INVESTMENT FUND, INC. FUND, INC. By: By: --------------------------------------------------- --------------------------------------------------------- Name: Name: ------------------------------------------------- ------------------------------------------------------- Title: Title: ------------------------------------------------ ------------------------------------------------------ CREDIT SUISSE ASSET MANAGEMENT CREDIT SUISSE ASSET INCOME FUND, INC. MANAGEMENT STRATEGIC GLOBAL INCOME FUND, INC. By: By: --------------------------------------------------- --------------------------------------------------------- Name: Name: ------------------------------------------------- ------------------------------------------------------- Title: Title: ------------------------------------------------ ------------------------------------------------------ THE PORTUGAL FUND, INC. By: --------------------------------------------------- Name: ------------------------------------------------- Title: ------------------------------------------------
-12- STATE STREET BANK AND TRUST THE BANK OF NOVA SCOTIA, COMPANY, in its individual capacity and in its individual capacity and as as Operations Agent Syndication Agent By: /s/ Steven G. Caron By: /s/ James R. Trimble ------------------------------------------ ------------------------------------- Name: Steven G. Caron Name: James R. Trimble ----------------------------------------- ----------------------------------- Title: Vice President Title: Managing Director ---------------------------------------- ---------------------------------- DEUTSCHE BANK AG, NEW YORK BNP PARIBAS, in its individual capacity and as BRANCH, in its individual capacity and Documentation Agent as Administrative Agent By: /s/ Gayma Z. Shivnarain By: /s/ Marguerite L. Lebon ------------------------------------------ ------------------------------------- Name: Gayma Z. Shivnarain Name: Marguerite L. Lebon ----------------------------------------- ----------------------------------- Title: Director Title: Assistant Vice President ---------------------------------------- ---------------------------------- By: /s/ Ruth Leung By: /s/ Laurent Vanderzyppe ------------------------------------------ ------------------------------------- Name: Ruth Leung Name: Laurent Vanderzyppe ----------------------------------------- ----------------------------------- Title: Director Title: Vice President ---------------------------------------- ---------------------------------- CREDIT LYONNAIS NEW YORK BRANCH DEN DANSKE BANK By: /s/ Sebastian Rocco By: /s/ George Neofitidis --------------------------------------- ------------------------------------- Name: Sebastian Rocco Name: George Neofitidis ----------------------------------------- ------------------------------------ Title: Senior Vice President Title: Assistant Vice President ---------------------------------------- ---------------------------------- By: /s/ John A. O'Neill ------------------------------------- Name: John A. O'Neill ------------------------------------ Title: Vice President ----------------------------------
-13- SCHEDULE 1 Dated as of June 21, 2000 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; State Street Bank and Trust Company, as operations agent and BNP Paribas, as documentation agent
PERCENTAGE JURISDICTION ALLOCATION OF NAME AND ADDRESS FORM OF OF FEES AND OF BORROWER ORGANIZATION ORGANIZATION EXPENSES BORROWING BASE Warburg, Pincus Capital Massachusetts Massachusett 3.46% 10% Appreciation Fund* Business Trust 466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: Warburg, Pincus Capital Appreciation Fund By: -------------------------------------------------- Name: ------------------------------------------------ Title: ----------------------------------------------- STANDING INSTRUCTIONS: Account Name: Warburg, Pincus Capital Appreciation Fund Account Number: 0360567 Bank: PNC Bank ABA No.: 031 000 053 Attn: Charles Geiser
SCHEDULE 1 Dated as of June 21, 2000 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; State Street Bank and Trust Company, as operations agent and BNP Paribas, as documentation agent
PERCENTAGE JURISDICTION ALLOCATION OF NAME AND ADDRESS FORM OF OF FEES AND OF BORROWER ORGANIZATION ORGANIZATION EXPENSES BORROWING BASE Warburg, Pincus Corporation Maryland 6.00% 10% Emerging Growth Fund, Inc.* 466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: Warburg, Pincus Emerging Growth Fund, Inc. By: -------------------------------------------------- Name: ------------------------------------------------ Title: ----------------------------------------------- STANDING INSTRUCTIONS: Account Name: Warburg, Pincus Emerging Growth Fund Account Number: 0361660 Bank: PNC Bank ABA No.: 031 000 053 Attn: Charles Geiser
SCHEDULE 1 Dated as of June 21, 2000 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; State Street Bank and Trust Company, as operations agent and BNP Paribas, as documentation agent
PERCENTAGE JURISDICTION ALLOCATION OF NAME AND ADDRESS FORM OF OF FEES AND OF BORROWER ORGANIZATION ORGANIZATION EXPENSES BORROWING BASE Warburg, Pincus Corporation Maryland 31.81% 10% International Equity Fund, Inc.** 466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: Warburg, Pincus International Equity Fund, Inc. By: -------------------------------------------------- Name: ------------------------------------------------ Title: ----------------------------------------------- STANDING INSTRUCTIONS: Account Name: Warburg, Pincus International Equity Fund/THI Account Number: 70887658 Bank: State Street, Boston ABA No.: 011 000 028 Attn: Charles Geiser
SCHEDULE 1 Dated as of June 21, 2000 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; State Street Bank and Trust Company, as operations agent and BNP Paribas, as documentation agent
PERCENTAGE JURISDICTION ALLOCATION OF NAME AND ADDRESS FORM OF OF FEES AND OF BORROWER ORGANIZATION ORGANIZATION EXPENSES BORROWING BASE Warburg, Pincus Corporation Maryland 0.35% 25% International Small Company Fund, Inc.** 466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: Warburg, Pincus International Small Company Fund, Inc. By: -------------------------------------------------- Name: ------------------------------------------------ Title: ----------------------------------------------- STANDING INSTRUCTIONS: Account Name: Warburg, Pincus International Small Company Fund/TH23 Account Number: 70887765 Bank: State Street/Boston ABA No.: 011 000 028 Attn: Charles Geiser
SCHEDULE 1 Dated as of June 21, 2000 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; State Street Bank and Trust Company, as operations agent and BNP Paribas, as documentation agent
PERCENTAGE JURISDICTION ALLOCATION OF NAME AND ADDRESS FORM OF OF FEES AND OF BORROWER ORGANIZATION ORGANIZATION EXPENSES BORROWING BASE Warburg, Pincus Corporation Maryland 14.97% 25% Japan Small Company Fund, Inc.** 466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: Warburg, Pincus Japan Small Company Fund, Inc. By: -------------------------------------------------- Name: ------------------------------------------------ Title: ----------------------------------------------- STANDING INSTRUCTIONS: Account Name: Warburg, Pincus Japan Small Company Fund/THO Account Number: 70887468 Bank: State Street/Boston ABA No.: 011 000 028 Attn: Charles Geiser
SCHEDULE 1 Dated as of June 21, 2000 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; State Street Bank and Trust Company, as operations agent and BNP Paribas, as documentation agent
PERCENTAGE JURISDICTION ALLOCATION OF NAME AND ADDRESS FORM OF OF FEES AND OF BORROWER ORGANIZATION ORGANIZATION EXPENSES BORROWING BASE Warburg, Pincus Corporation Maryland 13.26% 25% Japan Growth Fund, Inc.** 466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: Warburg, Pincus Japan Growth Fund, Inc. By: -------------------------------------------------- Name: ------------------------------------------------ Title: ----------------------------------------------- STANDING INSTRUCTIONS: Account Name: Warburg, Pincus Japan Growth Fund/THI4 Account Number: 70887690 Bank: State Street, Boston ABA No.: 011 000 028 Attn: Charles Geiser
SCHEDULE 1 Dated as of June 21, 2000 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; State Street Bank and Trust Company, as operations agent and BNP Paribas, as documentation agent
PERCENTAGE JURISDICTION ALLOCATION OF NAME AND ADDRESS FORM OF OF FEES AND OF BORROWER ORGANIZATION ORGANIZATION EXPENSES BORROWING BASE Warburg, Pincus Corporation Maryland 2.29% 20% Emerging Markets Fund, Inc.*** 466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: Warburg, Pincus Emerging Markets Fund, Inc. By: -------------------------------------------------- Name: ------------------------------------------------ Title: ----------------------------------------------- STANDING INSTRUCTIONS: Account Name: Warburg, Pincus Emerging Markets Fund/TH02 Account Number: 70887443 Bank: State Street, Boston ABA No.: 011 000 028 Attn: Charles Geiser
SCHEDULE 1 Dated as of June 21, 2000 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; State Street Bank and Trust Company, as operations agent and BNP Paribas, as documentation agent
PERCENTAGE JURISDICTION ALLOCATION OF NAME AND ADDRESS FORM OF OF FEES AND OF BORROWER ORGANIZATION ORGANIZATION EXPENSES BORROWING BASE Warburg, Corporation Maryland 0.27% 25% Pincus Major Foreign Markets Fund, Inc.** 466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: Warburg, Pincus Major Foreign Markets Fund, Inc. By: -------------------------------------------------- Name: ------------------------------------------------ Title: ----------------------------------------------- STANDING INSTRUCTIONS: Account Name: Warburg, Pincus Major Foreign Markets Fund/TH12 Account Number: 70887674 Bank: State Street, Boston ABA No.: 011 000 028 Attn: Charles Geiser
SCHEDULE 1 Dated as of June 21, 2000 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; State Street Bank and Trust Company, as operations agent and BNP Paribas, as documentation agent
PERCENTAGE JURISDICTION ALLOCATION OF NAME AND ADDRESS FORM OF OF FEES AND OF BORROWER ORGANIZATION ORGANIZATION EXPENSES BORROWING BASE Warburg, Corporation Maryland 0.06% 30% Pincus Small Company Value Fund, Inc.* 466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: Warburg, Pincus Small Company Value Fund, Inc. By: -------------------------------------------------- Name: ------------------------------------------------ Title: ----------------------------------------------- STANDING INSTRUCTIONS: Account Name: Warburg, Pincus Small Company Value Fund Account Number: 0367470 Bank: PNC Bank ABA No.: 031 000 053 Attn: Charles Geiser
SCHEDULE 1 Dated as of June 21, 2000 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; State Street Bank and Trust Company, as operations agent and BNP Paribas, as documentation agent
PERCENTAGE JURISDICTION ALLOCATION OF NAME AND ADDRESS FORM OF OF FEES AND OF BORROWER ORGANIZATION ORGANIZATION EXPENSES BORROWING BASE Warburg, Corporation Maryland 0.09% 30% Pincus Small Company Growth Fund, Inc.* 466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: Warburg, Pincus Small Company Growth Fund, Inc. By: -------------------------------------------------- Name: ------------------------------------------------ Title: ----------------------------------------------- STANDING INSTRUCTIONS: Account Name: Warburg, Pincus Small Company Growth Fund Account Number: 0367527 Bank: PNC Bank ABA No.: 031 000 053 Attn: Charles Geiser
SCHEDULE 1 Dated as of June 21, 2000 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; State Street Bank and Trust Company, as operations agent and BNP Paribas, as documentation agent
PERCENTAGE JURISDICTION ALLOCATION OF NAME AND ADDRESS FORM OF OF FEES AND OF BORROWER ORGANIZATION ORGANIZATION EXPENSES BORROWING BASE Warburg, Corporation Maryland 0.40% 25% Pincus Global Post Venture Capital Fund, Inc.** 466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: Warburg, Pincus Global Post Venture Capital Fund, Inc. By: -------------------------------------------------- Name: ------------------------------------------------ Title: ----------------------------------------------- STANDING INSTRUCTIONS: Account Name: Warburg, Pincus Global Post-Venture Capital Fund Account Number: 0367496 Bank: PNC Bank ABA No.: 031 000 053 Attn: Charles Geiser
SCHEDULE 1 Dated as of June 21, 2000 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; State Street Bank and Trust Company, as operations agent and BNP Paribas, as documentation agent
PERCENTAGE JURISDICTION ALLOCATION OF NAME AND ADDRESS FORM OF OF FEES AND OF BORROWER ORGANIZATION ORGANIZATION EXPENSES BORROWING BASE Warburg, Corporation Maryland 0.12% 25% Pincus Global Health Sciences Fund, Inc.** 466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: Warburg, Pincus Global Health Sciences Fund, Inc. By: -------------------------------------------------- Name: ------------------------------------------------ Title: ----------------------------------------------- STANDING INSTRUCTIONS: Account Name: Warburg, Pincus Global Health Sciences Fund, Inc Account Number: 0367519 Bank: PNC Bank ABA No.: 031 000 053 Attn: Charles Geiser
SCHEDULE 1 Dated as of June 21, 2000 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; State Street Bank and Trust Company, as operations agent and BNP Paribas, as documentation agent
PERCENTAGE JURISDICTION ALLOCATION OF NAME AND ADDRESS FORM OF OF FEES AND OF BORROWER ORGANIZATION ORGANIZATION EXPENSES BORROWING BASE Warburg, Massachusetts Massachusett 0.74% 30% Pincus Fixed Business Income Fund* Trust 466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: Warburg, Pincus Fixed Income Fund By: -------------------------------------------------- Name: ------------------------------------------------ Title: ----------------------------------------------- STANDING INSTRUCTIONS: Account Name: Warburg, Pincus Fixed Income Fund Account Number: 0360656 Bank: PNC Bank ABA No.: 031 000 053 Attn: Charles Geiser
SCHEDULE 1 Dated as of June 21, 2000 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; State Street Bank and Trust Company, as operations agent and BNP Paribas, as documentation agent
PERCENTAGE JURISDICTION ALLOCATION OF NAME AND ADDRESS FORM OF OF FEES AND OF BORROWER ORGANIZATION ORGANIZATION EXPENSES BORROWING BASE Warburg, Corporation Maryland 0.26% 25% Pincus Global Fixed Income Fund, Inc.** 466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: Warburg, Pincus Global Fixed Income Fund, Inc. By: -------------------------------------------------- Name: ------------------------------------------------ Title: ----------------------------------------------- STANDING INSTRUCTIONS: Account Name: Warburg, Pincus Global Fixed Income Fund/TH18 Account Number: 70887633 Bank: State Street, Boston ABA No.: 011 000 028 Attn: Charles Geiser
SCHEDULE 1 Dated as of June 21, 2000 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; State Street Bank and Trust Company, as operations agent and BNP Paribas, as documentation agent
PERCENTAGE JURISDICTION ALLOCATION OF NAME AND ADDRESS FORM OF OF FEES AND OF BORROWER ORGANIZATION ORGANIZATION EXPENSES BORROWING BASE Warburg, Corporation Maryland 0.12% 30% Pincus Intermediate Maturity Government Fund, Inc.* 466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: Warburg, Pincus Intermediate Maturity Government Fund, Inc. By: -------------------------------------------------- Name: ------------------------------------------------ Title: ----------------------------------------------- STANDING INSTRUCTIONS: Account Name: Warburg, Pincus Intermediate Maturity Government Fund Account Number: 0361783 Bank: PNC Bank ABA No.: 031 000 053 Attn: Charles Geiser
SCHEDULE 1 Dated as of June 21, 2000 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; State Street Bank and Trust Company, as operations agent and BNP Paribas, as documentation agent
PERCENTAGE JURISDICTION ALLOCATION OF NAME AND ADDRESS FORM OF OF FEES AND OF BORROWER ORGANIZATION ORGANIZATION EXPENSES BORROWING BASE Warburg, Corporation Maryland 0.07% 30% Pincus Balanced Fund, Inc.* 466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: Warburg, Pincus Balanced Fund, Inc. By: -------------------------------------------------- Name: ------------------------------------------------ Title: ----------------------------------------------- STANDING INSTRUCTIONS: Account Name: Warburg, Pincus Balanced Fund Account Number: 0181191 Bank: PNC Bank ABA No.: 031 000 053 Attn: Charles Geiser
SCHEDULE 1 Dated as of June 21, 2000 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; State Street Bank and Trust Company, as operations agent and BNP Paribas, as documentation agent
PERCENTAGE JURISDICTION ALLOCATION OF NAME AND ADDRESS FORM OF OF FEES AND OF BORROWER ORGANIZATION ORGANIZATION EXPENSES BORROWING BASE Warburg, Corporation Maryland 0.81% 30% Pincus Value Fund, Inc.* 466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: Warburg, Pincus Value Fund, Inc. By: -------------------------------------------------- Name: ------------------------------------------------ Title: ----------------------------------------------- STANDING INSTRUCTIONS: Account Name: Warburg, Pincus Value Fund Account Number: 0181175 Bank: PNC Bank ABA No.: 031 000 053 Attn: Charles Geiser
SCHEDULE 1 Dated as of June 21, 2000 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; State Street Bank and Trust Company, as operations agent and BNP Paribas, as documentation agent
PERCENTAGE JURISDICTION ALLOCATION OF NAME AND ADDRESS FORM OF OF FEES AND OF BORROWER ORGANIZATION ORGANIZATION EXPENSES BORROWING BASE Warburg, Massachusetts Massachusetts 0.18% 30% Pincus New Business York Trust Intermediate Municipal Fund* 466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: Warburg, Pincus New York Intermediate Municipal Government Fund By: -------------------------------------------------- Name: ------------------------------------------------ Title: ----------------------------------------------- STANDING INSTRUCTIONS: Account Name: Warburg, Pincus New York Intermediate Municipal Government Fund Account Number: 018044 Bank: PNC Bank ABA No.: 031 000 053 Attn: Charles Geiser
SCHEDULE 1 Dated as of June 21, 2000 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; State Street Bank and Trust Company, as operations agent and BNP Paribas, as documentation agent
PERCENTAGE JURISDICTION ALLOCATION OF NAME AND ADDRESS FORM OF OF FEES AND OF BORROWER ORGANIZATION ORGANIZATION EXPENSES BORROWING BASE Warburg, Corporation Maryland 1.33% 25% Pincus Global Telecommunications Fund, Inc.** 466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: Warburg, Pincus Global Telecommunications Fund, Inc. By: -------------------------------------------------- Name: ------------------------------------------------ Title: ----------------------------------------------- STANDING INSTRUCTIONS: Account Name: Warburg, Pincus Global Telecommunications Fund Account Number: 8124695 Bank: Brown Brothers ABA No.: 09250276 Attn: Charles Geiser
SCHEDULE 1 Dated as of June 21, 2000 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; State Street Bank and Trust Company, as operations agent and BNP Paribas, as documentation agent
PERCENTAGE JURISDICTION ALLOCATION OF NAME AND ADDRESS FORM OF OF FEES AND OF BORROWER ORGANIZATION ORGANIZATION EXPENSES BORROWING BASE Credit Suisse Corporation Maryland 1.24% 25% Institutional International Growth Fund, Inc.* 466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: Credit Suisse Institutional International Growth Fund, Inc. By: -------------------------------------------------- Name: ------------------------------------------------ Title: ----------------------------------------------- STANDING INSTRUCTIONS: Account Name: Credit Suisse Institutional International Growth Fund Account Number: 8122814 Bank: Brown Brothers ABA No.: 09250276 Attn: Charles Geiser
SCHEDULE 1 Dated as of June 21, 2000 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; State Street Bank and Trust Company, as operations agent and BNP Paribas, as documentation agent
PERCENTAGE JURISDICTION ALLOCATION OF NAME AND ADDRESS FORM OF OF FEES AND OF BORROWER ORGANIZATION ORGANIZATION EXPENSES BORROWING BASE Warburg, Corporation Maryland 0.24% 25% Pincus High Yield Fund, Inc.* 466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: Warburg, Pincus High Yield Fund, Inc. By: -------------------------------------------------- Name: ------------------------------------------------ Title: ----------------------------------------------- STANDING INSTRUCTIONS: Account Name: Warburg, Pincus High Yield Fund Account Number: 8122822 Bank: Brown Brothers ABA No.: 09250276 Attn: Charles Geiser
SCHEDULE 1 Dated as of June 21, 2000 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; State Street Bank and Trust Company, as operations agent and BNP Paribas, as documentation agent
PERCENTAGE JURISDICTION ALLOCATION OF NAME AND ADDRESS FORM OF OF FEES AND OF BORROWER ORGANIZATION ORGANIZATION EXPENSES BORROWING BASE Warburg, Corporation Maryland 0.04% 33% Pincus Municipal Bond Fund, Inc.* 466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: Warburg, Pincus Municipal Bond Fund, Inc. By: -------------------------------------------------- Name: ------------------------------------------------ Title: ----------------------------------------------- STANDING INSTRUCTIONS: Account Name: Warburg, Pincus Municipal Bond Fund Citibank, NY ABA No.: 021 000 089 BBH & Co Account Number: 09250276 Ref A/C # 8122855 Attn: Charles Geiser
SCHEDULE 1 Dated as of June 21, 2000 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; State Street Bank and Trust Company, as operations agent and BNP Paribas, as documentation agent
PERCENTAGE JURISDICTION ALLOCATION OF NAME AND ADDRESS FORM OF OF FEES AND OF BORROWER ORGANIZATION ORGANIZATION EXPENSES BORROWING BASE Credit Suisse Corporation Maryland 0.03% 25% Institutional Strategic Global Fixed Income Fund, Inc.** 466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: Credit Suisse Institutional Strategic Global Fixed Income Fund, Inc. By: -------------------------------------------------- Name: ------------------------------------------------ Title: ----------------------------------------------- STANDING INSTRUCTIONS: Account Name: Credit Suisse Institutional Strategic Global Fixed Income Fund Account Number: 8122830 Bank: Brown Brothers ABA No.: 09250276 Attn: Charles Geiser
SCHEDULE 1 Dated as of June 21, 2000 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; State Street Bank and Trust Company, as operations agent and BNP Paribas, as documentation agent
PERCENTAGE JURISDICTION ALLOCATION OF NAME AND ADDRESS FORM OF OF FEES AND OF BORROWER ORGANIZATION ORGANIZATION EXPENSES BORROWING BASE Warburg, Corporation Maryland 0.07% 25% Pincus European Equity Fund, Inc.** 466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: Warburg, Pincus European Equity Fund By: -------------------------------------------------- Name: ------------------------------------------------ Title: ----------------------------------------------- STANDING INSTRUCTIONS: Account Name: Warburg, Pincus European Equity Fund Account Number: 6105167 Bank: Brown Brothers ABA No.: 09250276 Attn: Charles Geiser
SCHEDULE 1 Dated as of June 21, 2000 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; State Street Bank and Trust Company, as operations agent and BNP Paribas, as documentation agent
PERCENTAGE JURISDICTION ALLOCATION OF NAME AND ADDRESS FORM OF OF FEES AND OF BORROWER ORGANIZATION ORGANIZATION EXPENSES BORROWING BASE Credit Suisse Corporation Maryland 0.85% 33% Institutional U.S. Core Fixed Income Fund, Inc.* 466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: Credit Suisse Institutional U.S. Core Fixed Income Fund, Inc. By: -------------------------------------------------- Name: ------------------------------------------------ Title: ----------------------------------------------- STANDING INSTRUCTIONS: Account Name: Credit Suisse Institutional U.S. Core Fixed Income Fund Citibank, NY ABA No.: 09250276 BBH & Co Account Number: 021 000 089 Ref A/C #8122913 Attn: Charles Geiser
SCHEDULE 1 Dated as of June 21, 2000 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; State Street Bank and Trust Company, as operations agent and BNP Paribas, as documentation agent
PERCENTAGE JURISDICTION ALLOCATION OF NAME AND ADDRESS FORM OF OF FEES AND OF BORROWER ORGANIZATION ORGANIZATION EXPENSES BORROWING BASE Warburg, Corporation Maryland 0.02% 20% Pincus Long-Short Market Neutral Fund, Inc.*** 466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: Warburg, Pincus Long-Short Market Neutral Fund, Inc. By: -------------------------------------------------- Name: ------------------------------------------------ Title: ----------------------------------------------- STANDING INSTRUCTIONS: Account Name: Warburg, Pincus Long-Short Market Neutral Fund Account Number: 113-80260 Bank: Custodial Trust Company ABA No.: 031207256 Attn: Charles Geiser
SCHEDULE 1 Dated as of June 21, 2000 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; State Street Bank and Trust Company, as operations agent and BNP Paribas, as documentation agent
PERCENTAGE JURISDICTION ALLOCATION OF NAME AND ADDRESS FORM OF OF FEES AND OF BORROWER ORGANIZATION ORGANIZATION EXPENSES BORROWING BASE Warburg, Corporation Maryland 0.02% 33% Pincus Focus Fund, Inc.* 466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: Warburg, Pincus Focus Fund, Inc. By: -------------------------------------------------- Name: ------------------------------------------------ Title: ----------------------------------------------- STANDING INSTRUCTIONS: Account Name: Warburg Pincus Focus Fund Citibank, NY ABA No.: 021 000 089 BBH & Co. Account Number: 09250276 Red A/C # 6103063 Attn: Charles Geiser
SCHEDULE 1 Dated as of June 21, 2000 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; State Street Bank and Trust Company, as operations agent and BNP Paribas, as documentation agent
PERCENTAGE JURISDICTION ALLOCATION OF NAME AND ADDRESS FORM OF OF FEES AND OF BORROWER ORGANIZATION ORGANIZATION EXPENSES BORROWING BASE Credit Suisse Corporation Maryland 0.16% 33% Institutional U.S. Core Equity Fund, Inc.* 466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: Credit Suisse Institutional U.S. Core Equity Fund, Inc. By: -------------------------------------------------- Name: ------------------------------------------------ Title: ----------------------------------------------- STANDING INSTRUCTIONS: Account Name: Credit Suisse Institutional U.S. Core Equity Fund, Inc. Citibank, NY ABA No.: 021 000 089 BBH & Co. Account Number: 09250276 Ref A/C # 8122905 Attn: Charles Geiser
SCHEDULE 1 Dated as of June 21, 2000 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; State Street Bank and Trust Company, as operations agent and BNP Paribas, as documentation agent
PERCENTAGE JURISDICTION ALLOCATION OF NAME AND ADDRESS FORM OF OF FEES AND OF BORROWER ORGANIZATION ORGANIZATION EXPENSES BORROWING BASE International Corporation Maryland 11.18% 25% Equity Portfolio- Credit Suisse Institutional Fund Inc. 466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: Credit Suisse Institutional Inc. By: -------------------------------------------------- Name: ------------------------------------------------ Title: ----------------------------------------------- STANDING INSTRUCTIONS: Account Name: Institutional - International Equity Portfolio Account Number: 70887666 Bank: State Street, Boston ABA No.: 011 000 028 Attn: Charles Geiser
SCHEDULE 1 Dated as of June 21, 2000 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; State Street Bank and Trust Company, as operations agent and BNP Paribas, as documentation agent
PERCENTAGE JURISDICTION ALLOCATION OF NAME AND ADDRESS FORM OF OF FEES AND OF BORROWER ORGANIZATION ORGANIZATION EXPENSES BORROWING BASE Emerging Corporation Maryland 0.00% 20% Markets Portfolio- Credit Suisse International Fund, Inc. 466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: Credit Suisse International Fund, Inc. By: -------------------------------------------------- Name: ------------------------------------------------ Title: ----------------------------------------------- STANDING INSTRUCTIONS: Account Name: Institutional-Emerging Markets Portfolio/THO Account Number: 34940072 Bank: State Street Boston ABA No.: 011 000 028 Attn: Charles Geiser
SCHEDULE 1 Dated as of June 21, 2000 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; State Street Bank and Trust Company, as operations agent and BNP Paribas, as documentation agent
PERCENTAGE JURISDICTION ALLOCATION OF NAME AND ADDRESS FORM OF OF FEES AND OF BORROWER ORGANIZATION ORGANIZATION EXPENSES BORROWING BASE Value Corporation Maryland 0.00% 30% Portfolio- Credit Suisse International Fund, Inc.* 466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: Credit Suisse International Fund, Inc. By: -------------------------------------------------- Name: ------------------------------------------------ Title: ----------------------------------------------- STANDING INSTRUCTIONS: Account Name: Institutional - Value Portfolio Account Number: 0367218 Bank: PNC Bank ABA No.: 031 000 053 Attn: Charles Geiser
SCHEDULE 1 Dated as of June 21, 2000 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; State Street Bank and Trust Company, as operations agent and BNP Paribas, as documentation agent
PERCENTAGE JURISDICTION ALLOCATION OF NAME AND ADDRESS FORM OF OF FEES AND OF BORROWER ORGANIZATION ORGANIZATION EXPENSES BORROWING BASE Japan Growth Corporation Maryland 0.04% 25% Portfolio-Credit Suisse Institutional Fund. Inc.** 466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: Credit Suisse Institutional Fund. Inc. By: -------------------------------------------------- Name: ------------------------------------------------ Title: ----------------------------------------------- STANDING INSTRUCTIONS: Account Name: Institutional - Japan Growth Portfolio /TH13 Account Number: 70887682 Bank: Bank Street, Boston ABA No.: 011 000 028 Attn: Charles Geiser
SCHEDULE 1 Dated as of June 21, 2000 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; State Street Bank and Trust Company, as operations agent and BNP Paribas, as documentation agent
PERCENTAGE JURISDICTION ALLOCATION OF NAME AND ADDRESS FORM OF OF FEES AND OF BORROWER ORGANIZATION ORGANIZATION EXPENSES BORROWING BASE Small Company Corporation Maryland 0.00% 30% Value Portfolio-Credit Suisse Institutional Fund. Inc. 466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: Credit Suisse Institutional Fund. Inc. By: -------------------------------------------------- Name: ------------------------------------------------ Title: ----------------------------------------------- STANDING INSTRUCTIONS: Account Name: Institutional - Small Company Value Portfolio Account Number: 0367226 Bank: PNC Bank ABA No.: 031 000 053 Attn: Charles Geiser
SCHEDULE 1 Dated as of June 21, 2000 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; State Street Bank and Trust Company, as operations agent and BNP Paribas, as documentation agent
PERCENTAGE JURISDICTION ALLOCATION OF NAME AND ADDRESS FORM OF OF FEES AND OF BORROWER ORGANIZATION ORGANIZATION EXPENSES BORROWING BASE International Massachusetts Massachusetts 1.42% 25% Equity Business Portfolio-Warburg, Trust Pincus Trust** 466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: Warburg, Pincus Trust By: -------------------------------------------------- Name: ------------------------------------------------ Title: ----------------------------------------------- STANDING INSTRUCTIONS: Account Name: Trust - International Equity Portfolio/Th Account Number: 7088754 Bank: State Street, Boston ABA No.: 011 000 028 Attn: Charles Geiser
SCHEDULE 1 Dated as of June 21, 2000 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; State Street Bank and Trust Company, as operations agent and BNP Paribas, as documentation agent
PERCENTAGE JURISDICTION ALLOCATION OF NAME AND ADDRESS FORM OF OF FEES AND OF BORROWER ORGANIZATION ORGANIZATION EXPENSES BORROWING BASE Small Company Massachusetts Massachusetts 3.62% 30% Growth Business Portfolio-Warburg, Trust Pincus Trust* 466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: Warburg, Pincus Trust By: -------------------------------------------------- Name: ------------------------------------------------ Title: ----------------------------------------------- STANDING INSTRUCTIONS: Account Name: Trust - Small Company Growth Portfolio Account Number: 0186117 Bank: PNC Bank ABA No.: 031 000 053 Attn: Charles Geiser
SCHEDULE 1 Dated as of June 21, 2000 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; State Street Bank and Trust Company, as operations agent and BNP Paribas, as documentation agent
PERCENTAGE JURISDICTION ALLOCATION OF NAME AND ADDRESS FORM OF OF FEES AND OF BORROWER ORGANIZATION ORGANIZATION EXPENSES BORROWING BASE Emerging Massachusetts Massachusetts 0.07% 20% Markets Business Portfolio - Trust Warburg, Pincus Trust*** 466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: Warburg, Pincus Trust By: -------------------------------------------------- Name: ------------------------------------------------ Title: ----------------------------------------------- STANDING INSTRUCTIONS: Account Name: Trust-Emerging Markets Portfolio/THO Account Number: 70887591 Bank: State Street Boston ABA No.: 011 000 028 Attn: Charles Geiser
SCHEDULE 1 Dated as of June 21, 2000 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; State Street Bank and Trust Company, as operations agent and BNP Paribas, as documentation agent
PERCENTAGE JURISDICTION ALLOCATION OF NAME AND ADDRESS FORM OF OF FEES AND OF BORROWER ORGANIZATION ORGANIZATION EXPENSES BORROWING BASE Global Massachusetts Massachusetts 0.47% 25% Post-Venture Business Capital Trust Portfolio-Warburg, Pincus Trust*** 466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: Warburg, Pincus Trust By: -------------------------------------------------- Name: ------------------------------------------------ Title: ----------------------------------------------- STANDING INSTRUCTIONS: Account Name: Global Post-Venture Capital Portfolio Account Number: 0367501 Bank: PNC Bank ABA No.: 031 000 053 Attn: Charles Geiser
SCHEDULE 1 Dated as of June 21, 2000 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; State Street Bank and Trust Company, as operations agent and BNP Paribas, as documentation agent
PERCENTAGE JURISDICTION ALLOCATION OF NAME AND ADDRESS FORM OF OF FEES AND OF BORROWER ORGANIZATION ORGANIZATION EXPENSES BORROWING BASE Value Massachusetts Massachusetts 0.04% 30% Portfolio - Business Warburg, Trust Pincus Trust* 466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: Warburg, Pincus Trust By: -------------------------------------------------- Name: ------------------------------------------------ Title: ----------------------------------------------- STANDING INSTRUCTIONS: Account Name: Trust - Value Portfolio Account Number: 0367250 Bank: PNC Bank ABA No.: 031 000 053 Attn: Charles Geiser
SCHEDULE 1 Dated as of June 21, 2000 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; State Street Bank and Trust Company, as operations agent and BNP Paribas, as documentation agent
PERCENTAGE JURISDICTION ALLOCATION OF NAME AND ADDRESS FORM OF OF FEES AND OF BORROWER ORGANIZATION ORGANIZATION EXPENSES BORROWING BASE Emerging Massachusetts Massachusetts 0.05% 10% Growth Business Portfolio - Trust Warburg, Pincus Trust* 466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: Warburg, Pincus Trust By: -------------------------------------------------- Name: ------------------------------------------------ Title: ----------------------------------------------- STANDING INSTRUCTIONS: Account Name: Warburg, Pincus Trust on behalf of the Emerging Growth Portfolio Account Number: 367616 Bank: PNC Bank ABA No.: 031 000 053 Attn: Charles Geiser
SCHEDULE 1 Dated as of June 21, 2000 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; State Street Bank and Trust Company, as operations agent and BNP Paribas, as documentation agent
PERCENTAGE JURISDICTION ALLOCATION OF NAME AND ADDRESS FORM OF OF FEES AND OF BORROWER ORGANIZATION ORGANIZATION EXPENSES BORROWING BASE The Brazilian Corporation Maryland 0.10% 10% Equity Fund, Inc. 466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: The Brazilian Equity Fund, Inc. By: -------------------------------------------------- Name: ------------------------------------------------ Title: ----------------------------------------------- STANDING INSTRUCTIONS: Account Name: The Brazilian Equity Fund ABA No.: 021 000 089 BBH & Co Account Number: 09250276 Ref A/C # 8106155 Attn: Bob Stewart
SCHEDULE 1 Dated as of June 21, 2000 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; State Street Bank and Trust Company, as operations agent and BNP Paribas, as documentation agent
PERCENTAGE JURISDICTION ALLOCATION OF NAME AND ADDRESS FORM OF OF FEES AND OF BORROWER ORGANIZATION ORGANIZATION EXPENSES BORROWING BASE The Chile Corporation Maryland 0.49% 15% Fund, Inc. 466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: The Chile Fund, Inc. By: -------------------------------------------------- Name: ------------------------------------------------ Title: ----------------------------------------------- STANDING INSTRUCTIONS: Account Name: Chile Fund Citibank, NY ABA No.: 021 000 089 BBH & Co. Account Number: 09250276 Ref A/C # 8106049 Attn: Bob Stewart
SCHEDULE 1 Dated as of June 21, 2000 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; State Street Bank and Trust Company, as operations agent and BNP Paribas, as documentation agent
PERCENTAGE JURISDICTION ALLOCATION OF NAME AND ADDRESS FORM OF OF FEES AND OF BORROWER ORGANIZATION ORGANIZATION EXPENSES BORROWING BASE The Emerging Corporation Maryland 0.36% 10% Markets Telecommunications Fund, Inc. 466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: The Emerging Markets Telecommunications Fund, Inc. By: -------------------------------------------------- Name: ------------------------------------------------ Title: ----------------------------------------------- STANDING INSTRUCTIONS: Account Name: The Emerging Markets Telecommunications Fund, Inc. Citibank, NY ABA No.: 021 000 089 BBH & Co. Account Number: 09250276 Ref A/C #8135204 Attn: Bob Stewart
SCHEDULE 1 Dated as of June 21, 2000 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; State Street Bank and Trust Company, as operations agent and BNP Paribas, as documentation agent
PERCENTAGE JURISDICTION ALLOCATION OF NAME AND ADDRESS FORM OF OF FEES AND OF BORROWER ORGANIZATION ORGANIZATION EXPENSES BORROWING BASE The Emerging Corporation Maryland 0.41% 15% Markets Infrastructure Fund, Inc. 466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: The Emerging Markets Infrastructure Fund, Inc. By: -------------------------------------------------- Name: ------------------------------------------------ Title: ----------------------------------------------- STANDING INSTRUCTIONS: Account Name: Emerging Markets Infrastructure Fund Citibank, NY ABA No.: 021 000 089 BBH & Co. Account Number: 09250276 Ref A/C #8122780 Attn: Bob Stewart
SCHEDULE 1 Dated as of June 21, 2000 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; State Street Bank and Trust Company, as operations agent and BNP Paribas, as documentation agent
PERCENTAGE JURISDICTION ALLOCATION OF NAME AND ADDRESS FORM OF OF FEES AND OF BORROWER ORGANIZATION ORGANIZATION EXPENSES BORROWING BASE The First Corporation Maryland 0.20% 15% Israel Fund, Inc. 466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: The First Israel Fund, Inc. By: -------------------------------------------------- Name: ------------------------------------------------ Title: ----------------------------------------------- STANDING INSTRUCTIONS: Account Name: First Israel Fund Citibank, NY ABA No.: 021 000 089 BBH & Co. Account Number: 09250276 Ref A/C #8136038 Attn: Bob Stewart
SCHEDULE 1 Dated as of June 21, 2000 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; State Street Bank and Trust Company, as operations agent and BNP Paribas, as documentation agent
PERCENTAGE JURISDICTION ALLOCATION OF NAME AND ADDRESS FORM OF OF FEES AND OF BORROWER ORGANIZATION ORGANIZATION EXPENSES BORROWING BASE The Indonesia Corporation Maryland 0.03% 10% Fund, Inc. 466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: The Indonesia Fund, Inc. By: -------------------------------------------------- Name: ------------------------------------------------ Title: ----------------------------------------------- STANDING INSTRUCTIONS: Account Name: Indonesia Fund Citibank, NY ABA No.: 021 000 089 BBH & Co. Account Number: 09250276 Ref A/C #8145906 Attn: Bob Stewart
SCHEDULE 1 Dated as of June 21, 2000 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; State Street Bank and Trust Company, as operations agent and BNP Paribas, as documentation agent
PERCENTAGE JURISDICTION ALLOCATION OF NAME AND ADDRESS FORM OF OF FEES AND OF BORROWER ORGANIZATION ORGANIZATION EXPENSES BORROWING BASE The Latin Corporation Maryland 0.28% 15% America Equity Fund, Inc. 466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: The Latin America Equity Fund, Inc. By: -------------------------------------------------- Name: ------------------------------------------------ Title: ----------------------------------------------- STANDING INSTRUCTIONS: Account Name: Latin America Equity Fund, Inc. Citibank, NY ABA No.: 021 000 089 BBH & Co. Account Number: 09250276 Ref A/C #8149320 Attn: Bob Stewart
SCHEDULE 1 Dated as of June 21, 2000 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; State Street Bank and Trust Company, as operations agent and BNP Paribas, as documentation agent
PERCENTAGE JURISDICTION ALLOCATION OF NAME AND ADDRESS FORM OF OF FEES AND OF BORROWER ORGANIZATION ORGANIZATION EXPENSES BORROWING BASE The Latin Corporation Maryland 0.26% 15% America Investment Fund, Inc. 466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: The Latin America Investment Fund, Inc. By: -------------------------------------------------- Name: ------------------------------------------------ Title: ----------------------------------------------- STANDING INSTRUCTIONS: Account Name: Latin America Investment Fund, Inc. Citibank, NY ABA No.: 021 000 089 BBH & Co. Account Number: 09250276 Ref A/C #8149346 Attn: Bob Stewart
SCHEDULE 1 Dated as of June 21, 2000 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; State Street Bank and Trust Company, as operations agent and BNP Paribas, as documentation agent
PERCENTAGE JURISDICTION ALLOCATION OF NAME AND ADDRESS FORM OF OF FEES AND OF BORROWER ORGANIZATION ORGANIZATION EXPENSES BORROWING BASE Credit Suisse Corporation Maryland 0.54% 10% Asset Management Income Fund, Inc. 466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: Credit Suisse Asset Management Income Fund, Inc. By: -------------------------------------------------- Name: ------------------------------------------------ Title: ----------------------------------------------- STANDING INSTRUCTIONS: Account Name: CSAM Income Fund, Inc. Citibank, NY ABA No.: 021 000 089 BBH & Co. Account Number: 09250276 Ref A/C #6107494 Attn: Bob Stewart
SCHEDULE 1 Dated as of June 21, 2000 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; State Street Bank and Trust Company, as operations agent and BNP Paribas, as documentation agent
PERCENTAGE JURISDICTION ALLOCATION OF NAME AND ADDRESS FORM OF OF FEES AND OF BORROWER ORGANIZATION ORGANIZATION EXPENSES BORROWING BASE Credit Suisse Asset Corporation Maryland 0.22% 15% Management Strategic Global Income Fund, Inc. 466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: Credit Suisse Asset Management Strategic Global Income Fund, Inc. By: -------------------------------------------------- Name: ------------------------------------------------ Title: ----------------------------------------------- STANDING INSTRUCTIONS: Account Name: CSAM Strategic Global Income Fund Citibank, NY ABA No.: 021 000 089 BBH & Co. Account Number: 09250276 Ref A/C #6107486 Attn: Bob Stewart
SCHEDULE 1 Dated as of June 21, 2000 To Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement, on behalf of itself and its respective investment portfolios identified thereon; the Banks listed on SCHEDULE 2 to the Credit Agreement; Deutsche Bank AG, New York Branch, as administrative agent; Bank of Nova Scotia, as syndication agent; State Street Bank and Trust Company, as operations agent and BNP Paribas, as documentation agent
PERCENTAGE JURISDICTION ALLOCATION OF NAME AND ADDRESS FORM OF OF FEES AND OF BORROWER ORGANIZATION ORGANIZATION EXPENSES BORROWING BASE The Portugal Fund, Inc. Corporation Maryland 0.16% 10% 466 Lexington Avenue New York, New York 10017 * Denotes Domestic Fund ** Denotes International Fund *** Denotes Restricted Fund To be executed on behalf of each Borrower by one or more Borrower Agents for such Borrower as follows: The Portugal Fund, Inc. By: -------------------------------------------------- Name William Clark Title: Secretary STANDING INSTRUCTIONS: Account Name: Portugal Fund Citibank, NY ABA No.: 021 000 089 BBH & Co. Account Number: 09250276 Ref A/C #8159436 Attn: Bob Stewart
SCHEDULE 2 BANKS; ADDRESSES; FACILITY PERCENTAGES (1) State Street Bank and Trust Company Global Investor Credit Services Division Mutual Fund Lending Lafayette Corporate Center 2 Avenue de Lafayette, 2nd Floor Boston, MA 02111 Fax: (617) 662-2325 Attention: Steven G. Caron, Vice President Commitment Amount: $75,000,000 Facility Percentage: 21.42858% (2) Deutsche Bank AG, New York Branch 31 West 52nd Street New York, NY 10019 Fax: (212) 469-8346 Attention: Alan Krouk, Assistant Vice President Commitment Amount: $75,000,000 Facility Percentage: 21.42858% (3) The Bank of Nova Scotia One Liberty Plaza New York, NY 10006 Fax: (212) 225-5090 Attention: John Morale, Director Commitment Amount: $50,000,000 Facility Percentage: 14.28571% (4) BNP Paribas 499 Park Avenue, 2rd Floor New York, NY 10022 Fax: (212) 415-9707 Attention: Ms. Marguerite L. Lebon, Assistant Vice President Commitment Amount: $50,000,000 Facility Percentage: 14.28571% (5) Den Danske Bank 280 Park Avenue 4th Floor - East Building New York, NY 10017 Fax: (212) 370-1682 Attention: Mr. George Neofitidis Commitment Amount: $50,000,000 Commitment Percentage: 14.28571% (6) Credit Lyonnais New York Branch 1301 Avenue of the Americas New York, NY 10019 Fax: (212) 261-3438 Attention: Ms. Rosemarie Dicanto Commitment Amount: $50,000,000 Commitment Percentage: 14.28571% -2- EXHIBIT A EXHIBIT A BORROWING REQUEST (Committed Credit Loans) TO: State Street Bank and Trust Company, as Operations Agent Lafayette Corporate Center 2 Avenue de Lafayette, 2nd Floor Boston, MA 02111 Attention: Stacey Gillet Fax: (617) 662-2324 This Borrowing Request (Committed Credit Loans) is being delivered pursuant to Section 2.04(a) of the Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "Credit Agreement") among each investment management company listed on SCHEDULE 1 to the Credit Agreement [as heretofore revised], on behalf of itself and its respective investment portfolios identified thereon, including the undersigned (collectively, the "BORROWERS"); the Banks listed on SCHEDULE 2 to the Credit Agreement [as heretofore revised] (collectively, and together with State Street Bank and Trust Company, in its capacity as Swing Line Lender, the "BANKS"); Deutsche Bank AG, New York Branch, as administrative agent (the "ADMINISTRATIVE AGENT"); The Bank of Nova Scotia, as syndication agent (the "SYNDICATION AGENT"); BNP Paribas, as documentation agent (the "DOCUMENTATION AGENT"); and State Street Bank and Trust Company, as operations agent (the "OPERATIONS AGENT"). Capitalized terms used herein shall have the meanings described to them in the Credit Agreement. The undersigned Borrower requests that a Committed Credit Loan be made by the Banks to such Borrower on this date in the aggregate amount set forth below: Name of Borrower: ------------------------------- Date of Proposed Borrowing [must be a Banking Day]: ------------------------------- Amount of Loan Requested [$1,000,000 or an integral multiple thereof]: $ ------------------------------- In connection with the foregoing Borrowing Request, the undersigned hereby certifies to the Operations Agent and the Banks as follows: (a) The value of the Borrower's portfolio securities is $_______________, the value of the Borrower's Total Assets is $_______________, and the value of the Borrower's Net Assets is $_____________ (in each case computed as of the close of business on the previous business day of the Borrower in accordance with the terms of the Credit Agreement). [NOTE: The aggregate Indebtedness of the Borrower in respect of Loans shall at no time exceed (i) 33-1/3% of the Borrower's Net Assets, in the case of any Borrower that is a Domestic Fund, (ii) 25% of the Borrower's Net Assets, in the case of Warburg Pincus Global Post Venture Capital Fund, Inc., Warburg Pincus Global Health Sciences Fund, Inc., Warburg Pincus High Yield Fund, Inc., and Global Post Venture Capital Portfolio of Warburg Pincus Trust, and any Borrower that is an International Fund, (iii) 20% of the Borrower's Net Assets, in the case of any Borrower that is a Restricted Fund, and (iv) 15% of the Borrower's Net Assets, in the case of any Borrower that is a Closed-End Fund.] (b) The Borrower's aggregate Indebtedness, including the proposed borrowing, is $____________________. (c) After giving effect to the transactions contemplated by this Borrowing Request on the date hereof, each of the conditions specified in Section 6.02 of the Credit Agreement has been fulfilled. (d) The Borrower will use the proceeds of the Committed Credit Loans requested hereby solely for the purposes permitted under Section 4.08 of the Credit Agreement. (e) The requested borrowing is permitted under the Borrower's most recent Prospectus. (f) The proceeds of this borrowing, when added to the aggregate principal amount of all Loans outstanding to the Borrower under the Credit Agreement, do not exceed the Borrower's Borrowing Base. (g) The proceeds of this borrowing, when added to the aggregate principal amount of Loans outstanding to the Borrowers under the Credit Agreement, do not exceed the Maximum Credit Amount. (h) The proceeds of this borrowing, when added to the aggregate principal amount of Committed Credit Loans outstanding to the Borrowers under the Credit Agreement, do not exceed the Maximum Committed Credit Amount. (i) The portion of the proceeds of this borrowing to be advanced by State Street Bank, when added to the aggregate outstanding principal amount of all Committed Credit Loans and Swing Line Loans made by State Street Bank to the Borrowers under the Credit Agreement, does not exceed State Street Bank's Commitment. -2- The undersigned Borrower Agent is an Authorized Officer of the Borrower. DATE: ------------------------------- ------------------------------ (Name of Borrower) By: -------------------------------- Name: ------------------------------ Title: ----------------------------- -3- EXHIBIT B EXHIBIT B BORROWING REQUEST (Swing Line Loans) TO: State Street Bank and Trust Company, as Swing Line Lender Lafayette Corporate Center 2 Avenue de Lafayette, 2nd Floor Boston, MA 02111 Attention: Stacey Gillet Fax: (617) 662-2324 This Borrowing Request (Swing Line Loans ) is being delivered pursuant to Section 3.03(a) of the Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "Credit Agreement") among each investment management company listed on SCHEDULE 1 to the Credit Agreement [as heretofore revised], on behalf of itself and its respective investment portfolios identified thereon, including the undersigned (collectively, the "BORROWERS"); the Banks listed on SCHEDULE 2 to the Credit Agreement [as heretofore revised] (collectively, and together with State Street Bank and Trust Company, in its capacity as Swing Line Lender, the "BANKS"); Deutsche Bank AG, New York Branch, as administrative agent (the "ADMINISTRATIVE AGENT"); The Bank of Nova Scotia, as syndication agent (the "SYNDICATION AGENT"); BNP Paribas, as documentation agent (the "DOCUMENTATION AGENT"); and State Street Bank and Trust Company, as operations agent (the "OPERATIONS AGENT"). Capitalized terms used herein shall have the meanings described to them in the Credit Agreement. The undersigned Borrower requests that a Swing Line Loan be made by the Swing Line Lender to such Borrower on this date in the aggregate amount set forth below: Name of Borrower: ------------------------------- Date of Proposed Borrowing [must be a Banking Day]: ------------------------------- Amount of Loan Requested: $ ------------------------------- In connection with the foregoing Borrowing Request, the undersigned hereby certifies to the Swing Line Lender as follows: (a) The value of the Borrower's portfolio securities is $_______________, the value of the Borrower's Total Assets is $_______________, and the value of the Borrower's Net Assets is $_____________ (in each case computed as of the close of business on the previous business day of the Borrower in accordance with the terms of the Credit Agreement). [NOTE: The aggregate Indebtedness of the Borrower in respect of Loans shall at no time exceed (i) 33-1/3% of the Borrower's Net Assets, in the case of any Borrower that is a Domestic Fund, (ii) 25% of the Borrower's Net Assets, in the case of Warburg Pincus Global Post Venture Capital Fund, Inc., Warburg Pincus Global Health Sciences Fund, Inc., Warburg Pincus High Yield Fund, Inc., and Global Post Venture Capital Portfolio of Warburg Pincus Trust, and any Borrower that is an International Fund, (iii) 20% of the Borrower's Net Assets, in the case of any Borrower that is a Restricted Fund, and (iv) 15% of the Borrower's Net Assets, in the case of any Borrower that is a Closed-End Fund.] (b) The Borrower's aggregate Indebtedness, including the proposed borrowing, is $____________________. (c) After giving effect to the transactions contemplated by this Borrowing Request on the date hereof, each of the conditions specified in Section 6.02 of the Credit Agreement has been fulfilled. (d) The Borrower will use the proceeds of the Swing Line Loan requested hereby solely for the purposes permitted under Section 4.08 of the Credit Agreement. (e) The requested borrowing is permitted under the Borrower's most recent Prospectus. (f) The proceeds of this borrowing, when added to the aggregate principal amount of all Loans outstanding to the Borrower under the Credit Agreement, do not exceed the Borrower's Borrowing Base. (g) The proceeds of this borrowing, when added to the aggregate principal amount of Swing Line Loans outstanding to the Borrowers under the Credit Agreement, do not exceed the Swing Line Amount. (h) The proceeds of this borrowing, when added to the aggregate principal amount of Loans outstanding to the Borrowers under the Credit Agreement, do not exceed the Maximum Credit Amount. (i) The proceeds of this borrowing, when added to the aggregate outstanding principal amount of all Committed Credit Loans and Swing Line Loans made by State Street Bank to the Borrowers under the Credit Agreement, does not exceed State Street Bank's Commitment. -2- The undersigned Borrower Agent is an Authorized Officer of the Borrower. DATE: ------------------------------- ------------------------------ (Name of Borrower) By: -------------------------------- Name: ------------------------------ Title: ----------------------------- -3- EXHIBIT C EXHIBIT F FORM FOR ADDITIONAL BORROWER ________________, 20__ To: State Street Bank and Trust Company, as Operations Agent, and the Banks party to that certain Credit Agreement, dated as of June 23, 1999, among the Borrowers, the Banks, the Operations Agent, and certain other parties Ladies and Gentlemen: The undersigned [ Name of Borrower ] (the "COMPANY") hereby requests pursuant to Article XIII of the Credit Agreement, dated as of June 23, 1999 (as amended and in effect from time to time, the "CREDIT AGREEMENT"), among each investment management company listed on SCHEDULE 1 to the Credit Agreement [as heretofore revised], on behalf of itself and its respective investment portfolios identified thereon (collectively, the "BORROWERS"); the Banks listed on SCHEDULE 2 to the Credit Agreement [as heretofore revised] (collectively, and together with State Street Bank and Trust Company, in its capacity as Swing Line Lender, the "BANKS"); Deutsche Bank AG, New York Branch, as administrative agent (the "ADMINISTRATIVE AGENT"); The Bank of Nova Scotia, as syndication agent (the "SYNDICATION AGENT"); BNP Paribas, as documentation agent (the "DOCUMENTATION AGENT"); and State Street Bank and Trust Company, as operations agent (the "OPERATIONS AGENT"), that it be admitted as an additional Borrower under the Credit Agreement and that SCHEDULE 1 to the Credit Agreement be revised in accordance with Section 4.09 of the Credit Agreement to include the Company as such in the form attached hereto which has been signed by one or more Borrower Agents on behalf of each Borrower. Capitalized terms used herein shall have the meanings ascribed to them in the Credit Agreement. The Company hereby represents and warrants to the Operations Agent and the Banks that as of the date hereof and after giving effect to the admission of the Company as an additional Borrower under the Credit Agreement: (i) the representations and warranties set forth in Article VII of the Credit Agreement with respect to the existing Borrowers are true and correct with respect to the Company after giving effect To the admission of the Company as a Borrower; (ii) the Company is in compliance in all material respects with all of the terms and provisions set forth in the Credit Agreement on its part to be observed or performed as of the date hereof and after giving effect to the admission; and (iii) no Default with respect To the Company has occurred and is continuing. The Company agrees to be bound by the terms and conditions of the Credit Agreement in all respects as a Borrower thereunder and hereby assumes all of the obligations of a Borrower thereunder. Please indicate your assent to the admission of the Company as an additional Borrower under the Credit Agreement by signing below where indicated. [NAME OF BORROWER] By: ------------------------------------- Name: ----------------------------------- Title: ---------------------------------- AGREED AND ACCEPTED: STATE STREET BANK AND TRUST COMPANY, in its individual capacity and as Operations Agent By: ------------------------------------- Name: ----------------------------------- Title: ---------------------------------- DEUTSCHE BANK AG, NEW YORK BRANCH, in its individual capacity and as Administrative Agent By: ------------------------------------- Name: ----------------------------------- Title: ---------------------------------- By: ------------------------------------- Name: ----------------------------------- Title: ---------------------------------- -2- THE BANK OF NOVA SCOTIA, in its individual capacity and as Syndication Agent By: ------------------------------------- Name: ----------------------------------- Title: ---------------------------------- BNP PARIBAS, in its individual capacity and as Documentation Agent By: ------------------------------------- Name: ----------------------------------- Title: ---------------------------------- By: ------------------------------------- Name: ----------------------------------- Title: ---------------------------------- CREDIT LYONNAIS NEW YORK BRANCH By: ------------------------------------- Name: ----------------------------------- Title: ---------------------------------- DEN DANSKE BANK By: ------------------------------------- Name: ----------------------------------- Title: ---------------------------------- -3- EX-99.14 7 0007.txt CONSENT OF INDEPENDENT ACCOUNTANTS CONSENT OF INDEPENDENT ACCOUNTANTS We hereby consent to the use in the Statement of Additional Information constituting part of this Registration Statement on Form N-14 (the "Registration Statement") of our reports dated February 21, 2001, relating to the financial statements and financial highlights of Credit Suisse Asset Management Income Fund, Inc. and Credit Suisse Asset Management Strategic Global Income Fund, Inc. appearing in the December 31, 2000 Annual Reports to Shareholders, which appear in such Statement of Additional Information, and to the incorporation by reference of our reports into the Proxy Statement/Prospectus and Statement of Additional Information which constitute part of this Registration Statement. We also consent to the references to us under the heading "Financial Highlights" and "Experts" in the Proxy Statement/Prospectus. /s/ PricewaterhouseCoopers LLP PricewaterhouseCoopers LLP Philadelphia, Pennsylvania February 28, 2001 EX-99.17 8 0008.txt CODE OF ETHICS CREDIT SUISSE ASSET MANAGEMENT, LLC WARBURG PINCUS FUNDS/CSAM CLOSED-END FUNDS CODE OF ETHICS I. APPLICABILITY This Code of Ethics establishes rules of conduct for "Access Persons" (as defined below) of Credit Suisse Asset Management, LLC, its subsidiaries and Credit Suisse Asset Management Securities, Inc. (collectively referred to as "CSAM") and each U.S. registered investment company that adopts this Code ("Covered Fund") (CSAM and the Covered Funds are collectively referred to as the "Covered Companies"). For purposes of this Code, "Access Person" shall mean: - any "Advisory Person" -- any employee or officer of CSAM and any natural person in a control relationship to a Covered Company (except for a natural person who, but for his or her holdings in a Covered Fund, would not be considered an Advisory Person, unless he or she obtains information concerning recommendations made to the Covered Fund with regard to the purchase or sale of securities by the Covered Fund, in which case such person shall be considered an Advisory Person only with respect to the Covered Fund); or - any director, trustee or officer of a Covered Fund, whether or not such person is an Advisory Person, in which case such person shall be considered an Access Person only with respect to the Covered Fund. For purposes of this Code: - the term "security" shall include any option to purchase or sell, any security that is convertible or exchangeable for, and any other derivative interest relating to the security; - the terms "purchase" and "sale" of a security shall include, among other things, the writing of an option to purchase or sell a security; and - all other terms shall have the same meanings as under the Investment Company Act of 1940 ("1940 Act"), unless indicated otherwise. II. STATEMENT OF GENERAL PRINCIPLES In conducting personal investment activities, all Access Persons are required to act consistent with the following general fiduciary principles: - the interests of CSAM clients, including Covered Funds, must always be placed first, 1 provided, however, that persons who are Access Persons only with respect to certain Covered Funds shall place the interests of such Covered Funds first; - all personal securities transactions must be conducted in such a manner as to avoid any actual or potential conflict of interest or any abuse of an individual's position of trust and responsibility; and - Access Persons must not take inappropriate advantage of their positions. CSAM has a separate policy and procedures designed to detect and prevent insider trading, which should be read together with this Code. Nothing contained in this Code should be interpreted as relieving any Access Person from the obligation to act in accordance with any applicable law, rule or regulation or any other statement of policy or procedure adopted by any Covered Company. III. PROHIBITIONS The following prohibitions and related requirements apply to Advisory Persons and/or Access Persons (as stated) and accounts in which they have "Beneficial Ownership" (as defined in Exhibit 1). A. SHORT TERM TRADING. CSAM discourages Advisory Persons from short-term trading (i.e., purchases and sales within a 60 day period), as such activity could be viewed as being in conflict with CSAM's general fiduciary principles. In no event, however, may an Advisory Person make a purchase and sale (or sale and purchase) of a security, including shares of Covered Funds and other U.S. registered investment companies (other than money market funds), within five "Business Days" (meaning days on which the New York Stock Exchange is open for trading). CSAM reserves the right to extend this prohibition period for the short-term trading activities of any or all Advisory Persons if CSAM determines that such activities are being conducted in a manner that may be perceived to be in conflict with CSAM's general fiduciary principles. B. SIDE-BY-SIDE TRADING. No Access Person may purchase or sell (directly or indirectly) any security for which there is a "buy" or "sell" order pending for a CSAM client (except that this restriction does not apply to any Access Person who is neither an Advisory Person nor an officer of a Covered Fund, unless he or she knows, or in the ordinary course of fulfilling official duties with a Covered Fund should know, that there is a "buy" or "sell" order pending with respect to such security for a CSAM client), or that such Access Person knows (or should know) at the time of such purchase or sale: - is being considered for purchase or sale by or for any CSAM client; or - is being purchased or sold by or for any CSAM client. C. BLACKOUT PERIODS. No Advisory Person may execute a securities transaction within five Business Days before and one Business Day after a transaction in that security for a CSAM 2 client. D. PUBLIC OFFERINGS. No Advisory Person may directly or indirectly acquire Beneficial Ownership in any security in a public offering in the primary securities market. E. PRIVATE PLACEMENTS. No Advisory Person may directly or indirectly acquire or dispose of any Beneficial Ownership in any privately placed security without the express prior written approval of a supervisory person designated in Section IX of this Code ("Designated Supervisory Person"). Approval will take into account, among other factors, whether the investment opportunity should be reserved for a CSAM client, whether the opportunity is being offered to the Advisory Person because of his or her position with CSAM or as a reward for past transactions and whether the investment creates or may in the future create a conflict of interest. F. SHORT SELLING. Advisory Persons are only permitted to engage in short selling for hedging purposes. No Advisory Person may engage in any transaction that has the effect of creating any net "short exposure" in an individual security. G. FUTURES CONTRACTS. No Advisory Person may invest in futures contracts, except through the purchase of options on futures contracts. H. OPTIONS. No Advisory Person may write (i.e., sell) any options except for hedging purposes and only if the option is fully covered. I. TRADING, HEDGING AND SPECULATION IN CREDIT SUISSE GROUP SECURITIES. Transactions by employees, officers and directors of CSAM in securities of Credit Suisse Group ("CSG") are prohibited for each period beginning 15 calendar days before announcement of CSG yearly or half-yearly results and ending two Business Days after the announcement. Employees, officers and directors of CSAM may only hedge VESTED positions in CSG stock through short sales or derivative instruments. Uncovered short exposure, through short sales or otherwise, is not permitted without the express prior written approval of a Designated Supervisory Person. J. INVESTMENT CLUBS. No Advisory Person may participate in an "investment club" or similar activity. K. DISCLOSURE OF INTEREST. No Advisory Person may recommend to or effect for any CSAM client any securities transaction without having disclosed his or her personal interest (actual or potential), if any, in the issuer of the securities, including without limitation: - any ownership or contemplated ownership of any privately placed securities of the issuer or any of its affiliates; - any employment, management or official position with the issuer or any of its affiliates; - any present or proposed business relationship between the Advisory Person and the issuer or any of its affiliates; and 3 - any additional factors that may be relevant to a conflict of interest analysis. Where the Advisory Person has a personal interest in an issuer, a decision to purchase or sell securities of the issuer or any of its affiliates by or for a CSAM client shall be subject to an independent review by a Designated Supervisory Person. L. GIFTS. No Advisory Person may seek or accept any gift of more than a DE MINIMIS value (approximately $250 per year) from any person or entity that does business with or on behalf of a CSAM client, other than reasonable, business-related meals and tickets to sporting events, theater and similar activities. If any Advisory Person is unsure of the appropriateness of any gift, a Designated Supervisory Person should be consulted. M. DIRECTORSHIPS AND OTHER OUTSIDE BUSINESS ACTIVITIES. No Advisory Person may serve on the board of directors/trustees of any issuer without the express prior written approval of a Designated Supervisory Person. Approval will be based upon a determination that the board service would be consistent with the interests of CSAM clients. Where board service is authorized, Advisory Persons serving as directors will be isolated from those making investment decisions regarding the securities of that issuer through "informational barrier" or other procedures specified by a Designated Supervisory Person. No Advisory Person may be employed (either for compensation or in a voluntary capacity) outside his or her regular position with CSAM or its affiliated companies without the written approval of a Designated Supervisory Person. IV. EXEMPT TRANSACTIONS A. EXEMPTIONS FROM PROHIBITIONS. 1. Purchases and sales of securities issued or guaranteed by the U.S. government or any agencies or instrumentalities of the U.S. government, municipal securities, and other non-convertible fixed income securities, which are in each case rated investment grade, are exempt from the prohibitions described in paragraphs C and D of Section III if such transactions are made in compliance with the preclearance requirements of Section V(B) below. 2. Any securities transaction, or series of related transactions, involving 500 shares or less of an issuer having a market capitalization (outstanding shares multiplied by the current market price per share) greater than $2.5 billion is exempt from the prohibition described in paragraph C of Section III if such transaction is made in compliance with the preclearance requirements of Section V(B) below. B. EXEMPTIONS FROM PROHIBITIONS AND PRECLEARANCE. The prohibitions described in paragraphs B through E of Section III and the preclearance requirements of Section V(B) shall not apply to: - purchases and sales of securities that are direct obligations of the U.S. government; - purchases and sales of securities of U.S. registered open-end investment companies; 4 - purchases and sales of bankers' acceptances, bank certificates of deposit, and commercial paper; - purchases that are part of an automatic dividend reinvestment plan; - purchases and sales that are non-volitional on the part of either the Access Person or the CSAM client; - purchases and sales in any account maintained with a party that has no affiliation with the Covered Companies and over which no Advisory Person has, in the judgment of a Designated Supervisory Person after reviewing the terms and circumstances, direct or indirect influence or control over the investment or trading of the account; and - purchases by the exercise of rights offered by an issuer pro rata to all holders of a class of its securities, to the extent that such rights were acquired from the issuer. C. FURTHER EXEMPTIONS. Express prior written approval may be granted by a Designated Supervisory Person if a purchase or sale of securities or other outside activity is consistent with the purposes of this Code and Section 17(j) of the 1940 Act and rules thereunder (attached as Attachment A is a form to request such approval). For example, a purchase or sale may be considered consistent with those purposes if the purchase or sale is not harmful to a CSAM client because such purchase or sale would be unlikely to affect a highly institutional market, or because such purchase or sale is clearly not related economically to the securities held, purchased or sold by the CSAM client. V. TRADING, PRECLEARANCE, REPORTING AND OTHER COMPLIANCE PROCEDURES A. TRADING THROUGH CSAM. No Advisory Person shall purchase or sell securities for an account in which he or she has Beneficial Ownership other than through the CSAM trading desk persons designated by a Designated Supervisory Person, unless express prior written approval is granted by a Designated Supervisory Person. B. PRECLEARANCE. Except as provided in Section IV, before any Advisory Person purchases or sells any security for any account in which he or she has Beneficial Ownership, preclearance shall be obtained in writing from a Designated Supervisory Person (attached as Attachment B is a form to request such approval). If clearance is given for a purchase or sale and the transaction is not effected on that Business Day, a new preclearance request must be made. C. REPORTING. 1. INITIAL CERTIFICATION. Within 10 days after the commencement of his or her employment with CSAM or his or her affiliation with any Covered Fund, each Access Person shall submit to a Designated Supervisory Person an initial certification in the form of Attachment C to certify that: - he or she has read and understood this Code of Ethics and recognizes that he or she is 5 subject to its requirements; and - he or she has disclosed or reported all personal securities holdings in which he or she has any direct or indirect Beneficial Ownership and all accounts in which any securities are held for his or her direct or indirect benefit. 2. ANNUAL CERTIFICATION. In addition, each Access Person shall submit to a Designated Supervisory Person an annual certification in the form of Attachment D to certify that: - he or she has read and understood this Code of Ethics and recognizes that he or she is subject to its requirements; - he or she has complied with all requirements of this Code of Ethics; and - he or she has disclosed or reported (a) all personal securities transactions for the previous year and (b) all personal securities holdings in which he or she has any direct or indirect Beneficial Ownership and accounts in which any securities are held for his or her direct or indirect benefit as of a date no more than 30 days before the annual certification is submitted. Access Persons may comply with the initial and annual reporting requirements by submitting account statements and/or Attachment E to a Designated Supervisory Person within the prescribed periods. An Access Person who is not an Advisory Person is not required to submit initial or annual certifications, unless such Access Person is an officer of a Covered Fund. Each Advisory Person shall annually disclose all directorships and outside business activities (attached as Attachment F is a form for such disclosure). 3. QUARTERLY REPORTING. All Advisory Persons and each Access Person who is an officer of a Covered Fund shall also supply a Designated Supervisory Person, on a timely basis, with duplicate copies of confirmations of all personal securities transactions and copies of periodic statements for all securities accounts, including confirmations and statements for transactions and accounts described in Section IV(B) above (exempt from prohibitions and preclearance). This information must be supplied at least once per calendar quarter, within 10 days after the end of the calendar quarter. Each Access Person who is neither an Advisory Person nor an officer of a Covered Fund is required to report a transaction only if he or she, at the time of that transaction, knew (or in the ordinary course of fulfilling official duties with a Covered Fund should have known) that during the 15-day period immediately before or after the date of the transaction the security such person purchased or sold was purchased or sold by the Covered Fund or was being considered for purchase or sale by the Covered Fund. VI. COMPLIANCE MONITORING AND SUPERVISORY REVIEW 6 A Designated Supervisory Person will periodically review reports from the CSAM trading desk (or, if applicable, confirmations from brokers) to assure that all transactions effected by Access Persons for accounts in which they have Beneficial Ownership are in compliance with this Code and Rule 17j-1 under the 1940 Act. Material violations of this Code and any sanctions imposed shall be reported not less frequently than quarterly to the board of directors of each relevant Covered Fund and to the senior management of CSAM. At least annually, each Covered Company shall prepare a written report to the board of directors/trustees of each Covered Fund, and to the senior management of CSAM, that: - describes issues that have arisen under the Code since the last report, including, but not limited to, material violations of the Code or procedures that implement the Code and any sanctions imposed in response to those violations; and - certifies that each Covered Company has adopted procedures reasonably necessary to prevent Access Persons from violating the Code. Material changes to this Code of Ethics must be approved by the Board of Directors of each Covered Fund no later than six months after the change is adopted. That approval must be based on a determination that the changes are reasonably necessary to prevent Access Persons from engaging in any conduct prohibited by the Code and Rule 17j-1 under the 1940 Act. Board approval must include a separate vote of a majority of the independent directors. VII. SANCTIONS Upon discovering that an Access Person has not complied with the requirements of this Code, the senior management of the relevant Covered Company may impose on that person whatever sanctions are deemed appropriate, including censure; fine; reversal of transactions and disgorgement of profits; suspension; or termination of employment. VIII. CONFIDENTIALITY All information obtained from any Access Person under this Code shall be kept in strict confidence, except that reports of transactions will be made available to the Securities and Exchange Commission or any other regulatory or self-regulatory organization to the extent required by law or regulation. IX. FURTHER INFORMATION The Designated Supervisory Persons are Hal Liebes and James W. Bernaiche or their designees in CSAM's legal and compliance department. Any questions regarding the Code of Ethics should be directed to a Designated Supervisory Person. Dated: March 1, 2000 7 EXHIBIT 1 CREDIT SUISSE ASSET MANAGEMENT, LLC WARBURG PINCUS FUNDS CODE OF ETHICS DEFINITION OF BENEFICIAL OWNERSHIP The term "Beneficial Ownership" as used in the attached Code of Ethics is to be interpreted by reference to Rule 16a-1(a)(2) under the Securities Exchange Act of 1934 ("Rule"). Under the Rule, a person is generally deemed to have Beneficial Ownership of securities if the person (directly or indirectly), through any contract, arrangement, understanding, relationship or otherwise, has or shares a direct or indirect pecuniary interest in the securities. The term "pecuniary interest" is generally defined in the Rule to mean the opportunity (directly or indirectly) to profit or share in any profit derived from a transaction in the securities. A person is deemed to have an "indirect pecuniary interest" within the meaning of the Rule: - - in any securities held by members of the person's immediate family sharing the same household; the term "immediate family" includes any child, stepchild, grandchild, parent, stepparent, grandparent, spouse, sibling, mother-in-law, father-in-law, son-in-law, daughter-in-law, brother-in-law or sister-in-law, as well as adoptive relationships; - - a general partner's proportionate interest in the portfolio securities held by a general or limited partnership; - - a person's right to dividends that is separated or separable from the underlying securities; - - a person's interest in certain trusts; and - - a person's right to acquire equity securities through the exercise or conversion of any derivative security, whether or not presently exercisable.(1) For purposes of the Rule, a person who is a shareholder of a corporation or similar entity is NOT deemed to have a pecuniary interest in portfolio securities held by the corporation or entity, so long as the shareholder is not a controlling shareholder of the corporation or the entity and does not have or share investment control over the corporation's or the entity's portfolio. The term "control" means the power to exercise a controlling influence over management or policies, unless the power is solely the result of an official position with the company. - --------------------- (1) The term "derivative security" is defined as any option, warrant, convertible security, stock appreciation right or similar right with an exercise or conversion privilege at a price related to an equity security (or similar securities) with a value derived from the value of an equity security. ATTACHMENT A CREDIT SUISSE ASSET MANAGEMENT, LLC WARBURG PINCUS FUNDS/CSAM CLOSED-END FUNDS CODE OF ETHICS -- SPECIAL APPROVAL FORM 1. The following is a private placement of securities or other investment requiring special approval in which I want to acquire or dispose of Beneficial Ownership:
NAME OF PRIVATE SECURITY OR DATE TO BE AMOUNT TO RECORD PURCHASE HOW ACQUIRED OTHER ACQUIRED BE HELD OWNER PRICE (BROKER/ISSUER) INVESTMENT - -------------------------------------------------------------------------------------------------------------------------- - -------------------------------------------------------------------------------------------------------------------------- - -------------------------------------------------------------------------------------------------------------------------- - -------------------------------------------------------------------------------------------------------------------------- - --------------------------------------------------------------------------------------------------------------------------
Would this investment opportunity be appropriate for a CSAM client? ___ Yes ___ No 2. I want to engage in the following outside business activity: -------------------------------------------------------------------------- -------------------------------------------------------------------------- -------------------------------------------------------------------------- 3. I want special approval to place personal securities trades other than through the CSAM trading desk (please describe): -------------------------------------------------------------------------- -------------------------------------------------------------------------- -------------------------------------------------------------------------- I certify, as applicable, that I (a) am not aware of any non-public information about the issuer, (b) have made all disclosures required by the Code of Ethics and (c) will comply with all reporting requirements of the Code. - -------------------------------- ------------------------------- Signature Date - -------------------------------- Print Name ___ Approved ___ Not Approved - ------------------------------- ------------------------------- Designated Supervisory Person Date ATTACHMENT B CREDIT SUISSE ASSET MANAGEMENT, LLC WARBURG PINCUS FUNDS/CSAM CLOSED-END FUNDS CODE OF ETHICS -- PERSONAL TRADING PRECLEARANCE FORM This form should be filled out COMPLETELY to expedite approval. 1. Security: ------------------------------------------ Ticker: ------------------------------------------- Purchase Sale ----- ----- 2. Number of shares/bonds/units/contracts: ----------------------------------- 3. Account Name/Shortname: ------------------------------------------------- 4. Brokerage Firm AND Account Number: --------------------------------------- 5. Why do you want to purchase or sell? Is this an opportunity appropriate for CSAM clients? -------------------------------------------------------------------------- 6. Are you aware of a CSAM Advisory Person who is buying or selling or who plans to buy or sell this security for his or her personal accounts or CSAM clients? Yes No ---- ---- If yes, who? -------------------------------------------------------------------------- 7. If the amount is less than 500 shares, is the issuer market capitalization greater than $2.5 billion? Yes No ---- ---- I certify that I (a) am not aware of any non-public information about the issuer, (b) have made all disclosures required by the Code of Ethics and this trade otherwise complies with the Code, including the prohibition on investments in initial public offerings, and (c) will comply with all reporting requirements of the Code. - ---------------------------------- ------------------------------------ Signature of Advisory Person Date - ---------------------------------- Print Name ___ Approved ___ Not Approved - ---------------------------------- ------------------------------------ Designated Supervisory Person Date - VALID THIS BUSINESS DAY ONLY. ATTACHMENT C CREDIT SUISSE ASSET MANAGEMENT, LLC WARBURG PINCUS FUNDS/CSAM CLOSED-END FUNDS CODE OF ETHICS INITIAL CERTIFICATION I certify that I: - have read and understood the Code of Ethics for Credit Suisse Asset Management, LLC, the Warburg Pincus Funds and the CSAM Closed-End Funds and recognize that I am subject to its requirements; and - have disclosed or reported all personal securities holdings in which I had any direct or indirect Beneficial Ownership and accounts in which any securities were held for my direct or indirect benefit as of the date I commenced employment with CSAM or the date I became affiliated with a Covered Fund. - -------------------------------- ------------------------------- Signature of Access Person Date - -------------------------------- Print Name ATTACHMENT D CREDIT SUISSE ASSET MANAGEMENT, LLC WARBURG PINCUS FUNDS/CSAM CLOSED-END FUNDS CODE OF ETHICS ANNUAL CERTIFICATION I certify that I: - have read and understood the Code of Ethics for Credit Suisse Asset Management, LLC, the Warburg Pincus Funds and the CSAM Closed-End Funds and recognize that I am subject to its requirements; - have complied with all requirements of the Code of Ethics and Policy and Procedures Designed to Detect and Prevent Insider Trading in effect during the year ended December 31, 1999; and - have disclosed or reported all personal securities transactions for the year ended December 31, 1999 and all personal securities holdings in which I had any direct or indirect Beneficial Ownership and all accounts in which any securities were held for my direct or indirect benefit as of December 31, 1999. - -------------------------------- ------------------------------- Signature of Access Person Date - -------------------------------- Print Name ATTACHMENT E CREDIT SUISSE ASSET MANAGEMENT, LLC WARBURG PINCUS FUNDS/CSAM CLOSED-END FUNDS CODE OF ETHICS - PERSONAL SECURITIES ACCOUNT DECLARATION ALL ACCESS PERSONS MUST COMPLETE EACH APPLICABLE ITEM (1, 2, 3 OR 4) AND SIGN BELOW. 1. The following is a list of securities/commodities accounts in which I have Beneficial Ownership: BROKER/DEALER ACCOUNT TITLE AND NUMBER - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- 2. The following is a list of securities/commodities accounts in which I had Beneficial Ownership that have been opened or closed in the past year: BROKER/DEALER ACCOUNT TITLE AND NUMBER - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- 3. The following is a list of any other securities or other investment holdings in which I have Beneficial Ownership (FOR SECURITIES HELD IN ACCOUNTS OTHER THAN THOSE DISCLOSED IN RESPONSE TO ITEMS 1 AND 2): NAME OF PRIVATE SECURITY OR OTHER DATE AMOUNT RECORD PURCHASE HOW ACQUIRED INVESTMENT ACQUIRED HELD OWNER PRICE (BROKER/ISSUER) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- 4. I do not have Beneficial Ownership in any securities/commodities accounts or otherwise have Beneficial Ownership of any securities or other instruments subject to the Code of Ethics. (Please initial.) ------------- Initials I declare that the information given above is true and accurate: - -------------------------------- ------------------------------- Signature of Access Person Date - -------------------------------- Print Name ATTACHMENT F CREDIT SUISSE ASSET MANAGEMENT, LLC WARBURG PINCUS FUNDS/CSAM CLOSED-END FUNDS CODE OF ETHICS OUTSIDE BUSINESS ACTIVITIES Outside business activities include, but are not limited to, the following: - - self-employment; - - receiving compensation from another person or company; - - serving as an officer, director, partner, or consultant of another business organization (including a family owned company); and - becoming a general or limited partner in a partnership or owning any stock in a business, unless the stock is publicly traded and no control relationship exists. Outside business activities include serving with a governmental (federal, state or local) or charitable organization whether or not for compensation. ALL ADVISORY PERSONS MUST COMPLETE AT LEAST ONE CHOICE (1 OR 2) AND SIGN BELOW. 1. The following are my outside business activities: - -------------------------------------------------------------------------------- OUTSIDE BUSINESS DESCRIPTION OF APPROVED BY DESIGNATED ACTIVITY ACTIVITY SUPERVISORY PERSON (YES/NO) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- 2. I am not involved in any outside business activities. (Please initial) ------------ Initials I declare that the information given above is true and accurate: - -------------------------------- ------------------------------- Signature of Advisory Person Date - -------------------------------- Print Name -----END PRIVACY-ENHANCED MESSAGE-----