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SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No. )
Filed by the Registrant /X/
Filed by a Party other than the Registrant / /
Check the appropriate box:
/ / Preliminary Proxy Statement
/ / Confidential, for Use of the Commission Only (as permitted
by Rule 14a6(e)(2))
/X/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Section 240.14a12
THE INDONESIA FUND, INC.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
/X/ No fee required.
/ / Fee computed on table below per Exchange Act Rules 14a6(i)(1) and 0-11.
(1) Title of each class of securities to which transaction applies:
(2) Aggregate number of securities to which transaction applies:
(3) Per unit price or other underlying value of transaction
computed pursuant to Exchange Act Rule 0-11 (set forth the
amount on which the filing fee is calculated and state how
it was determined):
(4) Proposed maximum aggregate value of transaction:
(5) Total fee paid:
/ / Fee paid previously with preliminary materials.
/ / Check box if any part of the fee is offset as provided by Exchange
Act Rule 0-11(a)(2) and identify the filing for which the offsetting
fee was paid previously. Identify the previous filing by registration
statement number, or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
(2) Form, Schedule or Registration Statement No.:
(3) Filing Party:
(4) Date Filed:
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THE INDONESIA FUND, INC.
466 LEXINGTON AVENUE
NEW YORK, NEW YORK 10017
YOUR VOTE IS IMPORTANT
DEAR SHAREHOLDER:
The governing Board of Directors (the "Board") of The Indonesia Fund, Inc.
(the "Fund") has recently reviewed and unanimously endorsed a proposal to retain
Credit Suisse Asset Management (Australia) Limited ("CSAM Australia"), the
Australian affiliate of Credit Suisse Asset Management, LLC ("CSAM"), the Fund's
investment adviser, as sub-investment adviser to the Fund. We are pleased to
invite you to attend the Annual Meeting of Shareholders of the Fund (the
"Meeting") to consider the approval of a sub-investment advisory agreement with
CSAM Australia and the election of two directors.
The Board and CSAM believe that the retention of CSAM Australia is in the
best interest of shareholders. The Board has determined that retention of CSAM
Australia will enable the Fund to capitalize on that firm's investment
expertise. SINCE THE SUB-ADVISORY FEES FOR CSAM AUSTRALIA WILL BE PAID BY CSAM,
THE PROPOSAL WILL NOT RESULT IN ANY INCREASE OF THE FEES OR EXPENSES OTHERWISE
INCURRED BY SHAREHOLDERS.
The costs associated with the solicitation of proxies for the Meeting are
being shared equally by the Fund and CSAM.
THE BOARD MEMBERS OF THE FUND BELIEVE THAT THE TWO PROPOSALS DESCRIBED IN
THE ACCOMPANYING PROXY STATEMENT ARE IMPORTANT AND RECOMMEND THAT YOU READ THE
ENCLOSED MATERIALS CAREFULLY AND THEN VOTE FOR BOTH OF THE PROPOSALS.
Detailed information about each proposal may be found in the attached Proxy
Statement. You are entitled to vote at the Meeting and any adjournments thereof
if you owned shares of the Fund at the close of business on August 20, 2002.
Respectfully,
/s/ Michael A. Pignataro
MICHAEL A. PIGNATARO
SECRETARY
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THE INDONESIA FUND, INC.
466 LEXINGTON AVENUE
NEW YORK, NEW YORK 10017
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
OCTOBER 9, 2002
-----------------
DEAR SHAREHOLDERS:
NOTICE IS HEREBY GIVEN that the Annual Meeting of Shareholders (the
"Meeting") of The Indonesia Fund, Inc. (the "Fund") will be held on October 9,
2002, at the offices of the Fund, 466 Lexington Avenue, 16th Floor, New York,
New York 10017, commencing at 1:00 p.m. New York time.
The Meeting is being held to consider and act upon the following proposals
as described in the accompanying Proxy Statement and such other matters as may
properly come before the Meeting or any adjournments thereof:
PROPOSAL 1: To approve a Sub-Investment Advisory Agreement among the Fund,
Credit Suisse Asset Management, LLC ("CSAM") and Credit Suisse Asset Management
(Australia) Limited ("CSAM Australia").
PROPOSAL 2: To elect Lawrence J. Fox and Laurence R. Smith as directors to
hold office for the term indicated and until his successor shall have been
elected and qualified.
THE BOARD OF DIRECTORS OF THE FUND UNANIMOUSLY RECOMMENDS THAT SHAREHOLDERS VOTE
FOR EACH OF THE TWO PROPOSALS BEING PRESENTED TO THE FUND'S SHAREHOLDERS.
Holders of record shares of the Fund at the close of business on August 20,
2002 are entitled to notice of, and to vote at, the Meeting and at any
adjournments thereof.
By Order of the Board of Directors,
/s/ Michael A. Pignataro
MICHAEL A. PIGNATARO
SECRETARY
WHETHER OR NOT YOU PLAN TO ATTEND THE MEETING IN PERSON, IT IS IMPORTANT THAT
YOUR SHARES BE REPRESENTED AND VOTED AT THE MEETING. ACCORDINGLY, PLEASE DATE,
SIGN AND RETURN THE ENCLOSED PROXY CARD PROMPTLY. NO POSTAGE IS REQUIRED IF
MAILED IN THE UNITED STATES. IT IS IMPORTANT THAT YOUR PROXY CARD BE RETURNED
PROMPTLY IN ORDER TO AVOID THE ADDITIONAL EXPENSE OF FURTHER SOLICITATION.
August 26, 2002
New York, New York
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THE INDONESIA FUND, INC.
466 LEXINGTON AVENUE
NEW YORK, NEW YORK 10017
ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD ON OCTOBER 9, 2002
-----------------
PROXY STATEMENT
--------------
This Proxy Statement is furnished in connection with the solicitation of
proxies by the Board of Directors (the "Board") of The Indonesia Fund, Inc. (the
"Fund") for use at the Annual Meeting of Shareholders (the "Meeting") of the
Fund at 466 Lexington Avenue, 16th Floor, New York, New York 10017, on October
9, 2002, and at any and all adjournments thereof. The Meeting will commence at
1:00 p.m., New York time.
A Notice of Annual Meeting of Shareholders and a proxy card ("Proxy")
accompany this Proxy Statement. This Proxy Statement, Notice of Annual Meeting
of Shareholders and the proxy card are first being mailed to shareholders on or
about August 26, 2002, or as soon as practicable thereafter.
All properly executed Proxies received prior to the Meeting will be voted at
the Meeting in accordance with the instructions marked thereon or otherwise as
provided therein. Unless instructions to the contrary are marked, shares
represented by Proxies will be voted "FOR" both the approval of the Sub-
Investment Advisory Agreement among the Fund, Credit Suisse Asset Management,
LLC ("CSAM") and Credit Suisse Asset Management (Australia) Limited ("CSAM
Australia" or the "Subadviser") and the election of the Fund's nominees,
Lawrence J. Fox and Laurence R. Smith, for director. Any shareholder giving a
Proxy has the power to revoke it by mail (addressed to the Secretary of The
Indonesia Fund, Inc., c/o Credit Suisse Asset Management, LLC, 466 Lexington
Avenue, New York, New York 10017) or in person at the Meeting by executing a
superseding Proxy or by submitting a notice of revocation.
A quorum of shareholders is constituted by the presence in person or by
proxy of the holders of a majority of the outstanding shares of the Fund
entitled to vote at the Meeting. In the event that a quorum is not present at
the Meeting, the holders of a majority of the shares present in person or by
proxy will have the power to adjourn the Meeting, without notice other than an
announcement at the Meeting, until the requisite number of shares entitled to
vote at the Meeting is present. In the event that a quorum is present at the
Meeting but sufficient votes to approve either of the proposals is not received,
the persons named as proxies may propose one or more adjournments of the Meeting
to permit further solicitation of Proxies. Any such adjournment will require the
affirmative vote of a majority of the Fund's shares represented at the Meeting
in person or by proxy and the persons named as proxies will vote those Proxies
that they are entitled to vote "FOR" or "AGAINST" any such proposal in their
discretion. Absent the establishment of a subsequent record date and the giving
of notice to the holders of record thereon, the adjourned Meeting must take
place not more than 120 days after the record date. At such adjourned Meeting,
any business may be transacted which might have been transacted at the original
Meeting. If a quorum is present, a shareholder vote may be taken on one or more
of the proposals in the Proxy Statement prior to any adjournment if sufficient
votes have been received and it is otherwise appropriate.
1
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For purposes of determining the presence of a quorum for transacting
business at the Meeting, abstentions and broker "non-votes" will be treated as
shares that are present but that have not been voted. Broker non-votes are
Proxies received from brokers or nominees when the broker or nominee has neither
received instructions from the beneficial owner or other persons entitled to
vote nor has discretionary power to vote on a particular matter been given.
Accordingly, shareholders are urged to forward their voting instructions
promptly.
Approval of Proposal 1 will require the affirmative vote of a majority of
the outstanding voting securities of the Fund ("Majority Vote"). "Majority Vote"
for purposes of this Proxy Statement, and under the Investment Company Act of
1940, as amended (the "1940 Act"), means the lesser of (i) 67% of the shares
represented at a meeting at which more than 50% of the outstanding shares of the
Fund are represented or (ii) more than 50% of the outstanding shares of the
Fund. Approval of Proposal 2 will require the affirmative vote of a plurality of
the votes cast at the Meeting in person or by proxy.
Abstentions and broker non-votes will have the effect of votes AGAINST
Proposal 1 for purposes of tabulating votes necessary for Proposal 1's approval.
Because abstentions and broker non-votes are not treated as shares voted, any
abstentions and broker non-votes would have no impact on Proposal 2.
Each full share outstanding is entitled to one vote and each fractional
share outstanding is entitled to a proportionate share of one vote. As of August
20, 2002 (the "Record Date"), the Fund had 8,266,202 outstanding shares.
In order that your shares may be represented at the Meeting, we request that
you:
--indicate your instructions on the Proxy;
--date and sign the Proxy;
--mail the Proxy promptly in the enclosed envelope;
--allow sufficient time for the Proxy to be received and processed on or
before October 9, 2002.
PROPOSAL 1
APPROVAL OF SUB-INVESTMENT ADVISORY AGREEMENT
INTRODUCTION
The Fund's shareholders will be asked at the Meeting to approve a
Sub-Investment Advisory Agreement (the "Sub-Advisory Agreement") among the Fund,
CSAM and CSAM's Australian affiliate, CSAM Australia. The Sub-Advisory Agreement
was unanimously approved by the Board, including all of the Directors (the
"Directors") who are not parties to the Sub-Advisory Agreement or "interested
persons" (as defined under the 1940 Act) of any such parties (the
"Non-Interested Directors") at a meeting held on May 13, 2002.
At the meeting, CSAM, as investment adviser to the Fund, recommended to the
Board that the Fund retain CSAM Australia as sub-investment adviser and that
pursuant to the proposed Sub-Advisory Agreement, CSAM (and not the Fund) pay
CSAM Australia a sub-advisory fee in such amount as may be agreed upon from time
to time by CSAM and the Subadviser. Thus, the retention of CSAM Australia will
not increase the fees or expenses otherwise incurred by the Fund or its
shareholders. Under the proposed Sub-Advisory Agreement, CSAM will monitor the
activities and performance of CSAM Australia.
2
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The Sub-Advisory Agreement for the Fund as approved by the Board is now
being submitted for approval by the Fund's shareholders. If it is approved by a
Majority Vote of the Fund's outstanding shares, it will continue in effect for
an initial two-year term, and will continue from year to year thereafter,
subject to approval annually by the Board or by a Majority Vote of the
outstanding shares of the Fund, and also, in either event, approval by a
majority of the Non-Interested Directors at a meeting called for the purpose of
voting on such approval. If the shareholders of the Fund should fail to approve
the Sub-Advisory Agreement, the Board will consider appropriate action with
respect to such non-approval of the Sub-Advisory Agreement.
A form of the Sub-Advisory Agreement is attached hereto as APPENDIX A.
CSAM's principal office is located at 466 Lexington Avenue, New York, New
York 10017, and CSAM Australia's principal office is located at Level 32
Gateway, 1 Macquarie Place, Sydney 2001.
AS DESCRIBED ABOVE, THE SUB-ADVISORY FEE PAYABLE TO CSAM AUSTRALIA PURSUANT
TO THE SUB-ADVISORY AGREEMENT WILL BE PAID BY CSAM AND, ACCORDINGLY, THE
RETENTION OF CSAM AUSTRALIA WILL NOT INCREASE THE FEES OR EXPENSES OTHERWISE
INCURRED BY THE FUND OR ITS SHAREHOLDERS.
BOARD EVALUATION AND RECOMMENDATION
In determining whether it was appropriate to approve the Sub-Advisory
Agreement for CSAM Australia and to recommend approval to shareholders, the
Board, including the Non-Interested Directors, considered various matters and
materials provided by CSAM and CSAM Australia. The Board considered, primarily,
the greater geographic proximity of CSAM Australia to Indonesia and the
relatively greater access that CSAM Australia may have to information about
Indonesian companies and the economy of Indonesia. The Board also considered the
benefit the Fund may derive from CSAM Australia's ability to obtain best price
and execution on trades on the Indonesian securities market due to its
familiarity with the market. The Board also carefully considered the particular
expertise of CSAM Australia in managing the types of investments which the Fund
makes, including their personnel and research capabilities. The Board also
evaluated the extent of the proposed services to be offered by CSAM Australia.
In addition, the Board took into account the lack of any anticipated adverse
impact to the Fund as a result of the Sub-Advisory Agreement, particularly that
THE COMPENSATION PAID TO CSAM AUSTRALIA WILL BE PAYABLE BY CSAM AND,
ACCORDINGLY, THAT THE RETENTION OF CSAM AUSTRALIA WILL NOT INCREASE THE FEES OR
EXPENSES OTHERWISE INCURRED BY THE FUND OR ITS SHAREHOLDERS.
BACKGROUND INFORMATION REGARDING THE FUND
The Fund invests primarily in Indonesian equity securities consisting
predominantly of common stock, preferred stock and convertible securities and
warrants. The Fund may also invest in Indonesian debt securities.
Currently, Bear Stearns Funds Management Inc. ("Bear Stearns"), serves as
the Fund's administrator. Bear Stearns has its principal executive office at 383
Madison Avenue, 23rd Floor, New York, New York 10179. Brown Brothers Harriman &
Co. ("Brown Brothers") serves as custodian for assets for the Fund. Brown
Brothers principal business address is 40 Water Street, Boston, Massachusetts
02109. THESE SERVICE AGREEMENTS WILL NOT BE AFFECTED BY THE PROPOSED
SUB-ADVISORY AGREEMENT.
3
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DESCRIPTION OF CURRENT INVESTMENT ADVISORY AGREEMENT
CSAM, a professional investment counseling firm, serves as the Fund's
investment adviser and is the institutional and mutual fund asset management arm
of Credit Suisse First Boston, and a wholly owned subsidiary of Credit Suisse
Group ("Credit Suisse"). Credit Suisse is a global financial services company,
providing a comprehensive range of banking and insurance products. The principal
business address of Credit Suisse is Paradeplatz 8, CH 8070, Zurich,
Switzerland. CSAM is a diversified investment adviser managing global and
domestic equity and fixed income portfolios for retail investors as well as
institutional clients such as corporate pension and profit-sharing plans, state
pension funds, union funds, endowments and charitable institutions. Together
with its predecessor firms, CSAM has been engaged in the investment advisory
business for over 60 years. As of June 30, 2002, Credit Suisse Asset Management
companies managed approximately $66 billion in the U.S. and $313 billion
globally. Credit Suisse Asset Management has offices in 14 countries, including
CSAM and CSAM Australia; other offices (such as those in Budapest, Frankfurt,
Milan, Moscow, Paris, Prague, Warsaw and Zurich) are not registered with the
U.S. Securities and Exchange Commission (the "SEC").
Pursuant to the Investment Advisory Agreement with CSAM (the "Advisory
Agreement"), subject to the supervision and direction of the Board, CSAM is
responsible for managing the Fund in accordance with the Fund's stated
investment objective and policies. CSAM is responsible for providing investment
advisory services as well as conducting a continual program of investment,
evaluation and, if appropriate, sale and reinvestment of the Fund's assets. In
addition to expenses that CSAM may incur in performing its services under the
Advisory Agreement, CSAM pays the compensation, fees and related expenses of all
Directors who are affiliated persons of CSAM or any of its subsidiaries and, if
the Sub-Advisory Agreement is approved by the shareholders of the Fund, will pay
the sub-advisory fee to CSAM Australia as described more fully below. The Fund
pays all other expenses incurred in its operations, including general
administrative expenses.
The Advisory Agreement dated December 21, 1990 was last approved by
shareholders on September 28, 1990 in order to satisfy an undertaking to present
the Advisory Agreement for shareholder approval following the Fund's initial
public offering.
As compensation for its services to the Fund, CSAM receives compensation at
an annual rate of 1.00% of the Fund's average weekly net assets. For the fiscal
year ended December 31, 2001, CSAM received $106,131 in total compensation from
the Fund.
REGARDLESS OF WHETHER THE SUB-ADVISORY AGREEMENT IS APPROVED, CSAM WILL
CONTINUE TO SERVE AS INVESTMENT ADVISER TO THE FUND PURSUANT TO THE ADVISORY
AGREEMENT AND BEAR STEARNS WILL CONTINUE TO PROVIDE ADMINISTRATIVE SERVICES TO
THE FUND.
DESCRIPTION OF PROPOSED SUB-ADVISORY AGREEMENT
Subject to the supervision of CSAM, the Sub-Advisory Agreement requires CSAM
Australia, in the exercise of its best judgment, to provide investment advisory
assistance and portfolio management advice to the Fund in accordance with the
Fund's Articles of Incorporation, as may be amended from time to time, and the
Fund's Registration Statement, as from time to time in effect, and in such
manner and to such extent as may from time to time be approved by the Board.
4
<Page>
In connection with the Sub-Advisory Agreement, CSAM Australia will, subject
to the supervision and direction of CSAM:
(1) manage that portion of the Fund's assets designated by CSAM from time to
time (the "Assets") or furnish recommendations to manage the Assets in
accordance with the Fund's investment objective and policies;
(2) make investment decisions or recommendations with respect to the Assets;
(3) if requested by CSAM, place purchase and sale orders for securities on
behalf of the Fund with respect to the Assets;
(4) exercise voting rights with respect to the Assets, if requested by CSAM;
and
(5) furnish CSAM and the Fund's Board with such periodic and special reports
as the Fund or CSAM may reasonably request.
It is contemplated that CSAM Australia will be solely responsible for the
day-to-day management of all of the Fund's assets, subject to CSAM's
supervision.
In connection with the performance of services under the Sub-Advisory
Agreement, CSAM Australia may contract at its own expense with third parties for
the acquisition of research, clerical services and other administrative services
that would not require such third parties to be required to register as an
investment adviser under the Investment Advisers Act of 1940, as amended (the
"Advisers Act"); provided that CSAM Australia remains liable for the performance
of each such third party's duties.
The services of CSAM Australia under the proposed Sub-Advisory Agreement are
not exclusive. CSAM Australia has the right to provide similar services to other
investment companies or to engage in other activities, provided that those
activities do not adversely affect its ability to perform its services under the
Sub-Advisory Agreement.
The Sub-Advisory Agreement will terminate automatically in the event of its
assignment. In addition, it may be terminated by CSAM or CSAM Australia upon 60
days' written notice to the other parties; or with respect to the Fund, upon the
vote of a majority of the Board or a majority of the outstanding voting
securities of the Fund, upon 60 days' written notice to CSAM and CSAM Australia.
CSAM will pay CSAM Australia, in consideration of its services as
sub-adviser, a quarterly fee equal to 90% of the net quarterly amount received
by CSAM as the Fund's investment adviser. Such fee will be payable in U.S.
dollars in arrears on the last business day of each calendar quarter. The fee
for the first period during which the Sub-Advisory Agreement for the Fund is in
effect will be pro-rated for the portion of the calendar quarter that the
Sub-Advisory Agreement is in effect.
CSAM WILL PAY CSAM AUSTRALIA THE SUB-ADVISORY FEE. CSAM AUSTRALIA DOES NOT
HAVE A RIGHT TO OBTAIN COMPENSATION DIRECTLY FROM THE FUND FOR SERVICES PROVIDED
UNDER THE SUB-ADVISORY AGREEMENT AND MUST LOOK SOLELY TO CSAM FOR PAYMENT OF
FEES DUE.
INFORMATION ABOUT CSAM AUSTRALIA
CSAM Australia was registered as a company under the Laws of Victoria,
Australia on September 15, 1989. CSAM Australia is licensed as a securities
dealer and operator of managed investment schemes under the Australian
Corporations Act of 2001 and is an investment adviser registered under the
Advisers
5
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Act. The registered office of CSAM Australia is Level 32 Gateway, 1 Macquarie
Place, Sydney 2001. CSAM Australia is a diversified asset manager, specializing
in equity, fixed income and balanced portfolio management for a range of clients
including pension funds, government agencies and large companies as well as
private individuals. CSAM Australia has been in the funds management business
for over 12 years and currently manages approximately AUD $22 billion (US
$12 billion) in assets.
CSAM Australia is a wholly owned subsidiary of Credit Suisse First Boston.
Credit Suisse First Boston is a wholly owned subsidiary of Credit Suisse, the
indirect parent company of the Funds' investment adviser, CSAM. Credit Suisse
First Boston is located at Uetlibergstrasse 231, Uetlihof 1 CH-8045 Zurich,
Switzerland. Credit Suisse is located at Paradeplatz 8, 8001 Zurich,
Switzerland.
CSAM Australia is governed by a Board of Directors, with the day-to-day
affairs of the company managed by an Executive Committee. The names and
principal occupations of the directors and officers of CSAM Australia are set
forth below. Each of the persons listed may be contacted c/o Credit Suisse Asset
Management (Australia) Limited, Level 32 Gateway, 1 Macquarie Place, Sydney, NSW
2000, Australia.
<Table>
<Caption>
CURRENT POSITION WITH CSAM OTHER CURRENT PRINCIPAL
NAME AUSTRALIA OCCUPATIONS
- ---- ------------------------------ ----------------------------------------
Andrew McKinnon CEO and Director N.A.
Bronwyn Matheson Director and Company Secretary N.A.
William Gates Director N.A.
Joseph Gallagher Director Global CFO and Member of Executive Board
of Credit Suisse Asset Management
</Table>
THE FUND'S BOARD OF DIRECTORS, INCLUDING THE NON-INTERESTED DIRECTORS,
UNANIMOUSLY RECOMMENDS THAT YOU VOTE "FOR" PROPOSAL 1.
PROPOSAL 2
The second proposal to be submitted at the Meeting will be the election of
two (2) Directors of the Fund to hold office for the term set forth below and
until their respective successors are elected and qualified.
The Board is divided into three classes, each class having a term of no more
than three years. Each year the term of office of one class expires and the
successor or successors elected to such class will serve for a three-year term.
Lawrence J. Fox and Laurence R. Smith, Directors whose current terms expire
on the date of this Meeting, have been nominated for a three-year term to expire
at the 2005 Annual Meeting of Shareholders.
The nominees have indicated an intention to continue to serve if elected and
have consented to being named in this Proxy Statement.
6
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The following table sets forth certain information regarding the nominees
for election to the Board, Directors whose terms of office continue beyond the
Meeting, and the Fund's officers.
<Table>
<Caption>
NUMBER OF
PORTFOLIOS IN
TERM OF FUND OTHER
POSITION(S) OFFICE AND PRINCIPAL OCCUPATION(S) COMPLEX DIRECTORSHIPS
HELD WITH LENGTH OF DURING PAST OVERSEEN BY HELD BY
NAME, ADDRESS, AND AGE FUND TIME SERVED 5 YEARS DIRECTOR DIRECTOR
- ---------------------- --------------- ------------------- ----------------------- ------------- ----------------------
NON-INTERESTED DIRECTORS:
- -----------------------------------------
Enrique R. Arzac Director Since 2000; current Professor of Finance 8 Director of The Adams
c/o CSAM term ends at the and Economics, Graduate Express Company (a
466 Lexington Avenue 2003 annual School of Business, closed-end investment
New York, NY 10017 meeting. Columbia University company); Director of
Age: 60 (1971-present). Petroleum and
Resources Corporation
(a closed-end
investment company).
Richard H. Francis Director Since 1990; current Currently retired; 55 --
c/o CSAM term ends at the Executive Vice
466 Lexington Avenue 2004 annual President and Chief
New York, NY 10017 meeting. Financial Officer of
Age: 70 Pan Am Corporation and
Pan American World
Airways, Inc.
(1988-1991).
Lawrence J. Fox Director Since 2000; current Partner, Drinker 3 Director, Winthrop
One Logan Square term ends at the Biddle & Reath (law Trust Company.
18th & Cherry Streets 2002 annual firm) (1976-present);
Philadelphia, PA 19103 meeting. Managing Partner
Age: 58 Drinker Biddle & Reath
(1992-1998).
INTERESTED DIRECTORS:
- -----------------------------------------
William W. Priest, Jr.* Director Since 1990; current Senior Partner of 61 --
12 East 49th Street term ends at the Steinberg Priest &
New York, NY 10017 2003 annual Sloane Capital
Age: 60 meeting. Management
(3/01-present);
Chairman and Managing
Director of CSAM
(5/00-2/01); Chief
Executive Officer and
Managing Director of
CSAM (11/89-5/00).
</Table>
7
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<Table>
<Caption>
NUMBER OF
PORTFOLIOS IN
TERM OF FUND OTHER
POSITION(S) OFFICE AND PRINCIPAL OCCUPATION(S) COMPLEX DIRECTORSHIPS
HELD WITH LENGTH OF DURING PAST OVERSEEN BY HELD BY
NAME, ADDRESS, AND AGE FUND TIME SERVED 5 YEARS DIRECTOR DIRECTOR
- ---------------------- --------------- ------------------- ----------------------- ------------- ----------------------
Laurence R. Smith* Chief Executive Since May 2002; Global Chief Investment 2 --
c/o CSAM Officer, current term ends Officer and Managing
466 Lexington Avenue Chairman of the at the 2002 annual Director of CSAM
New York, NY 10017 Board and meeting. (1999-present);
Age: 43 Director Managing Director of
J.P. Morgan Investment
Management (1981-1999).
</Table>
<Table>
<Caption>
TERM OF
POSITION(S) OFFICE AND PRINCIPAL OCCUPATION(S)
HELD WITH LENGTH OF DURING PAST
NAME, ADDRESS, AND AGE FUND TIME SERVED 5 YEARS
- ------------------------ --------------- ------------------------------------- ----------------------------------------
OFFICERS:
- -----------------------------------------
Hal Liebes Senior Vice Since 1997; current term ends at the Managing Director and General Counsel of
c/o CSAM President Board meeting next following the 2002 CSAM (12/99-present); Director and
466 Lexington Avenue annual meeting. General Counsel of CSAM (3/97-12/99);
New York, NY 10017 executive officer of other CSAM-advised
Age: 37 investment companies.
Richard W. Watt President and Since 2002; current term ends at the Managing Director of CSAM
c/o CSAM Chief Board meeting next following the 2002 (7/96-present).; executive officer of
466 Lexington Avenue Investment annual meeting. other CSAM-advised investment companies.
New York, NY 10017 Officer
Age: 43
Michael A. Pignataro Chief Financial Since 1990; current term ends at the Director of CSAM (1/01-present); Vice
c/o CSAM Officer and Board meeting next following the 2002 President of CSAM (12/95-12/00);
466 Lexington Avenue Secretary annual meeting. executive officer of other CSAM-advised
New York, NY 10017 investment companies.
Age: 42
Rocco A. Del Guercio Vice President Since 1997; current term ends at the Vice President of CSAM (1/01-present);
c/o CSAM Board meeting next following the 2002 Assistant Vice President of CSAM
466 Lexington Avenue annual meeting. (1/99-12/00); Administrative Officer of
New York, NY 10017 CSAM (6/96-12/98); executive officer of
Age: 38 other CSAM-advised investment companies.
Robert M. Rizza Treasurer Since 1999; current term ends at the Assistant Vice President of CSAM
c/o CSAM Board meeting next following the 2002 (1/01-present); Administrative Officer
466 Lexington Avenue annual meeting. of CSAM (3/98-12/00); Assistant
New York, NY 10017 Treasurer Bankers Trust Co. (4/94-3/98);
Age: 36 executive officer of other CSAM-advised
investment companies.
</Table>
- --------------------
* Mr. William W. Priest, Jr. is an interested person of the Fund by virtue of
his former position as an officer of CSAM and Mr. Laurence R. Smith by
virtue of his current position as an officer of CSAM.
8
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Set forth in the table below is the dollar range of equity securities in the
Fund and the aggregate dollar range of equity securities in the CSAM Family of
Closed-End Investment Companies (as defined below) beneficially owned by each
Director.
<Table>
<Caption>
AGGREGATE DOLLAR RANGE OF EQUITY
SECURITIES IN ALL FUNDS OVERSEEN BY
DIRECTOR IN CSAM FAMILY OF
DOLLAR RANGE OF EQUITY SECURITIES CLOSED-END INVESTMENT
NAME OF DIRECTOR IN THE FUND*(1)(2) COMPANIES*(1)(3)
- ---------------- --------------------------------- -----------------------------------
Enrique R. Arzac...................... B E
Richard H. Francis.................... B B
Lawrence J. Fox....................... B E
William W. Priest, Jr................. A A
Laurence R. Smith..................... A A
</Table>
- --------------
* Key to Dollar Ranges:
A. None
B. $1 -- $10,000
C. $10,001 -- $50,000
D. $50,001 -- $100,000
E. over $100,000
(1) This information has been furnished by each Director as of June 30, 2002.
"Beneficial Ownership" is determined in accordance with
Rule 16a-1(a)(2) promulgated under the Securities Exchange Act of 1934 (the
"1934 Act").
(2) The Fund's directors and officers, in the aggregate, own less than 1% of the
Fund's outstanding equity securities.
(3) "CSAM Family of Closed-End Investment Companies" means those registered
investment companies that share CSAM as the investment adviser and that hold
themselves out to investors as related companies for purposes of investment
and investor services.
As of June 30, 2002, none of the Non-Interested Directors, including the
non-interested nominee for election to the Board, or their immediate family
members owned beneficially or of record any class of securities in CSAM or in a
person (other than a registered investment company) directly or indirectly
controlling, controlled by, or under common control with CSAM.
During the fiscal year ended December 31, 2001, each Director who was not a
director, officer, partner, co-partner or employee of CSAM, Bear Stearns or any
affiliate thereof, received an annual fee of $5,000 and $500 for each meeting of
the Board attended by him and was reimbursed for expenses incurred in connection
with his attendance at the Fund's Board meetings. The total remuneration paid or
accrued by the Fund during the fiscal year ended December 31, 2001 to all such
Non-Interested Directors was $25,500.
During the fiscal year ended December 31, 2001, the Board convened 8 times.
Each Director attended at least seventy-five percent of the aggregate number of
meetings of the Board and any committees on which he served during the period
for which he was a Director.
Messrs. Arzac, Francis and Fox constitute the Fund's Audit Committee, which
is composed of Directors who are not interested persons of the Fund and who are
independent (as such term is defined by the New York Stock Exchange's listing
standards). The Audit Committee convened twice during the fiscal year ended
December 31, 2001. The Audit Committee advises the full Board with respect to
accounting, auditing and financial matters affecting the Fund. The Directors
constituting the Fund's Audit Committee also constitute the Fund's Nominating
Committee, which is composed of Directors who are not interested
9
<Page>
persons of the Fund. The Nominating Committee did not meet during the fiscal
year ended December 31, 2001. The Nominating Committee selects and nominates new
Non-Interested 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 the Fund. The
Fund does not have a compensation committee.
AUDIT COMMITTEE REPORT
Pursuant to the Audit Committee Charter adopted by the Board, the Audit
Committee is responsible for conferring with the Fund's independent accountants,
reviewing annual financial statements and recommending the selection of the
Fund's independent accountants. The Audit Committee advises the full Board with
respect to accounting, auditing and financial matters affecting the Fund. The
independent accountants are responsible for planning and carrying out the proper
audits and reviews of the Fund's financial statements and expressing an opinion
as to their conformity with accounting principles generally accepted in the
United States of America.
The Audit Committee has met with the Fund's management to discuss, among
other things, the Fund's audited financial statements for the fiscal year ended
December 31, 2001. The Audit Committee has also met with the Fund's independent
accountants, PricewaterhouseCoopers LLP ("PwC"), and discussed with them certain
matters required by Statement of Auditing Standards No. 61, COMMUNICATIONS WITH
AUDIT COMMITTEES, as currently modified or supplemented, including, but not
limited to, the scope of the Fund's audit, the Fund's financial statements and
the Fund's accounting controls. The Audit Committee has received the written
disclosures and the letter from PwC required by the SEC's independence
rules delineating relationships between the independent accountants and the Fund
and the impact that any such relationships may have on the objectivity and
independence of the independent accountants. The Audit Committee has discussed
with PwC their independence and has considered whether the provision of services
by PwC to the Fund and to CSAM, as more fully described below, was compatible
with maintaining PwC's independence.
The members of the Audit Committee are not professionally engaged in the
practice of auditing or accounting and are not employed by the Fund for
accounting, financial management or internal control. Moreover, the Audit
Committee relies on and makes no independent verification of the facts presented
to it or representations made by management or the independent accountants.
Accordingly, the Audit Committee's oversight does not provide an independent
basis to determine that management has maintained appropriate accounting and
financial reporting principles and policies, or internal controls and
procedures, designed to assure compliance with accounting standards and
applicable laws and regulations. Furthermore, the Audit Committee's
considerations and discussions referred to above do not provide assurance that
the audit of the Fund's financial statements has been carried out in accordance
with generally accepted accounting standards or that the financial statements
are presented in accordance with generally accepted accounting principles.
Based upon these reviews and discussions, the Audit Committee recommended to
the Fund's Board that the Fund's audited financial statements be included in the
Fund's 2001 Annual Report to Shareholders for the year ended December 31, 2001
and be mailed to shareholders and filed with the SEC.
10
<Page>
SUBMITTED BY THE AUDIT COMMITTEE OF THE FUND'S BOARD OF DIRECTORS
Enrique R. Arzac
Richard H. Francis
Lawrence J. Fox
INDEPENDENT ACCOUNTANTS
At a meeting held on February 13, 2002, the Board, including the
Non-Interested Directors, approved the selection of PwC for the fiscal year
ending December 31, 2002. PwC has been the Fund's independent accountants since
the Fund commenced operations, and has informed the Fund that it has no material
direct or indirect financial interest in the Fund. A representative of PwC will
be available by telephone at the Meeting and will have the opportunity to make a
statement if the representative so desires and will be available to respond to
appropriate questions.
The following table shows the aggregate fees PwC billed to the Fund, to CSAM
and to any entity controlling, controlled by or under common control with CSAM
that provides services to the Fund for their professional services rendered for
the fiscal year ended December 31, 2001.
<Table>
<Caption>
CSAM AND
FUND CERTAIN AFFILIATES
----------- ------------------
Audit Fees.................................................. $32,800 $ 0
Financial Information Systems Design and Implementation
Fees...................................................... 0 0
All Other Fees.............................................. 8,200 460,000
</Table>
COMPENSATION
The following table shows certain compensation information for the Directors
for the fiscal year ended December 31, 2001. All officers of the Fund are
employees of and are compensated by CSAM. None of the Fund's executive officers
or Directors who are also officers or directors of CSAM received any
compensation from the Fund for such period. The Fund has no bonus, profit
sharing, pension or retirement plans.
<Table>
<Caption>
TOTAL
COMPENSATION FROM
AGGREGATE FUND
COMPENSATION FROM AND FUND COMPLEX
NAME OF DIRECTOR FUND PAID TO DIRECTORS
- ---------------- ----------------- -----------------
Enrique R. Arzac........................................... $8,500 $ 72,792
Richard H. Francis......................................... 8,500 110,250
Lawrence J. Fox............................................ 8,500 38,292
James P. McCaughan*........................................ 0 0
William W. Priest, Jr...................................... 0 0
</Table>
- --------------
* Subsequent to December 31, 2001, Mr. McCaughan resigned as a Director.
THE FUND'S BOARD OF DIRECTORS, INCLUDING THE NON-INTERESTED DIRECTORS,
RECOMMENDS THAT THE SHAREHOLDERS VOTE "FOR" THE FUND'S NOMINEES FOR DIRECTOR.
11
<Page>
ADDITIONAL INFORMATION
GENERAL
The Fund will pay one-half of the costs associated with the Meeting
(estimated at $35,000), with the remainder being paid by CSAM and/or its
affiliates. Proxy solicitations will be made primarily by mail, but
solicitations may also be made by telephone, telegraph or personal interviews
conducted by officers or employees of the Fund, CSAM, Bear Stearns, or Georgeson
Shareholder Communications, Inc. ("Georgeson"), a proxy solicitation firm that
has been retained by the Fund and which will receive a fee of approximately
$3,500 and will be reimbursed for its reasonable expenses.
BENEFICIAL OWNERS
As of June 30, 2002, there were no beneficial owners of more than 5% of the
outstanding shares of the Fund who possessed or shared voting or investment
power with respect to the shares.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the 1934 Act and Section 30(h) of the 1940 Act require the
Fund's officers and directors, officers and directors of the investment adviser,
affiliated persons of the investment adviser, and persons who beneficially own
more than 10% of the Fund's Shares to file reports of ownership with the SEC,
the Boston Stock Exchange 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, 2001,
all filing requirements applicable to such persons were complied with.
SHAREHOLDER PROPOSALS
Notice is hereby given that for a shareholder proposal to be considered for
inclusion in the Fund's proxy material relating to its 2003 annual meeting of
shareholders, the shareholder proposal must be received by the Fund no later
than April 26, 2003. The shareholder proposal, including any accompanying
supporting statement, may not exceed 500 words. A shareholder desiring to submit
a proposal must be a record or beneficial owner of Shares with a market value of
$2,000 and must have held such Shares for at least one year. Further, the
shareholder must continue to hold such Shares through the date on which the
meeting is held. Documentary support regarding the foregoing must be provided
along with the proposal. There are additional requirements regarding proposals
of shareholders, and a shareholder contemplating submission of a proposal is
referred to Rule 14a-8 promulgated under the 1934 Act. The timely submission of
a proposal does not guarantee its inclusion in the Fund's proxy materials.
Pursuant to the By-laws of the Fund, at any annual meeting of the
shareholders, only such business will be conducted as has been properly brought
before the annual meeting. To be properly brought before the annual meeting, the
business must be (i) specified in the notice of meeting (or any supplement
thereto) given by or at the direction of the Board, (ii) otherwise properly
brought before the meeting by or at the direction of the Board, or
(iii) otherwise properly brought before the meeting by a shareholder.
For business to be properly brought before the annual meeting by a
shareholder, the shareholder must have given timely notice thereof in writing to
the Secretary of the Fund. To be timely, any such notice must be delivered to or
mailed and received at The Indonesia Fund, Inc. c/o Credit Suisse Asset
Management, LLC, 466 Lexington Avenue, 16th Floor, New York, NY 10017 not later
than 45 days before the date in the then current year corresponding to the date
on which the Fund first mailed its notice and proxy materials for the annual
meeting held in the prior year; provided, however, that in the event that the
date of the
12
<Page>
annual meeting is advanced or delayed by more than 30 days from the first
anniversary of the preceding year's 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
such meeting was given or made. In no event shall the public announcement of an
adjournment of an annual meeting commence a new time period for the giving of a
shareholder's notice as described above.
Any such notice by a shareholder shall set forth as to each matter the
shareholder proposes to bring before the annual meeting: (i) a brief description
of the business desired to be brought before the annual meeting and the reasons
for conducting such business at the annual meeting, (ii) the name and address,
as they appear on the Fund's books, of the shareholder proposing such business,
(iii) the class and number of shares of the capital stock of the Fund which are
beneficially owned by the shareholder, (iv) a representation that the
shareholder is a holder of record of shares of the Fund 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.
The Fund may exercise discretionary voting authority with respect to any
shareholder proposals for the 2003 annual meeting of shareholders not included
in the proxy statement and form of proxy which are not submitted to the Fund
within the time-frame indicated above. Even if timely notice is received, the
Fund may exercise discretionary voting authority in certain other circumstances.
Discretionary voting authority is the ability to vote proxies that shareholders
have executed and returned to the Fund on matters not specifically reflected on
the form of proxy.
SHAREHOLDERS WHO DO NOT EXPECT TO BE PRESENT AT THE ANNUAL MEETING AND WHO
WISH TO HAVE THEIR SHARES VOTED ARE REQUESTED TO DATE AND SIGN THE ENCLOSED
PROXY CARD AND RETURN IT IN THE ENCLOSED ENVELOPE. NO POSTAGE IS REQUIRED IF
MAILED IN THE UNITED STATES.
OTHER BUSINESS
Management knows of no business to be presented at the Meeting, other than
the matters set forth in this Proxy Statement, but should any other matter
requiring the vote of shareholders arise, the proxies will vote thereon
according to their best judgment in the interests of the Fund.
THE FUND WILL FURNISH, WITHOUT CHARGE, A COPY OF ITS MOST RECENT ANNUAL
REPORT AND ANY MORE RECENT SEMI-ANNUAL REPORT TO A SHAREHOLDER UPON REQUEST. ANY
SUCH REQUEST SHOULD BE DIRECTED TO THE FUND BY CALLING 1-800-293-1232, BY
WRITING TO THE FUND C/O CREDIT SUISSE ASSET MANAGEMENT, LLC AT 466 LEXINGTON
AVENUE, 16TH FLOOR, NEW YORK, NEW YORK 10017, OR AT THE FUND'S WEBSITE AT
WWW.CEFSOURCE.COM. THESE REQUESTS WILL BE HONORED WITHIN THREE BUSINESS DAYS OF
RECEIPT.
13
<Page>
APPENDIX A
FORM OF SUB-INVESTMENT ADVISORY AGREEMENT
, 2002
Credit Suisse Asset Management (Australia) Limited
Level 32, Gateway Building
1 Macquarie Place
SYDNEY NSW 2000
Dear Sir/Madam:
The Indonesia Fund, Inc. (the "Fund"), a corporation organized and existing
under the laws of the State of Maryland, and Credit Suisse Asset Management,
LLC, as investment adviser to the Fund ("CSAM"), herewith confirms their
agreement with Credit Suisse Asset Management (Australia) Limited (the
"Sub-Adviser"), a company registered under the laws of the State of Victoria, as
follows:
1. INVESTMENT DESCRIPTION; APPOINTMENT
The Fund desires to employ the capital of the Fund by investing and
reinvesting in securities of the kind and in accordance with the limitations
specified in the Fund's Articles of Incorporation, as may be amended from time
to time (the "Articles of Incorporation"), and in the Fund's Registration
Statement, as from time to time in effect (the "Registration Statement") and in
such manner and to such extent as may from time to time be approved by the Board
of Directors of the Fund. Copies of the Registration Statement and Articles of
Incorporation have been or will be submitted to the Sub-Adviser. The Fund agrees
to promptly provide the Sub-Adviser with copies of all amendments to the
Registration Statement on an on-going basis. The Fund employs CSAM as its
investment adviser. CSAM desires to employ and hereby appoints the Sub-Adviser
to act as its sub-investment adviser upon the terms set forth in this Agreement.
The Sub-Adviser accepts the appointment and agrees to furnish the services set
forth below for the compensation provided for herein.
2. SERVICES AS SUB-INVESTMENT ADVISER
(a) Subject to the supervision and direction of CSAM, the Sub-Adviser will
provide investment advisory and portfolio management advice to all or that
portion of the Fund's assets designated by CSAM from time to time (the "Assets")
in accordance with (a) the Articles of Incorporation, (b) the Investment Company
Act of 1940, as amended (the "1940 Act"), and the Investment Advisers Act of
1940, as amended (the "Advisers Act"), and all applicable Rules and Regulations
of the Securities and Exchange Commission (the "SEC") and all other applicable
laws and regulations, and (c) the Fund's investment objective and policies as
stated in the Registration Statement and investment parameters provided by CSAM
from time to time. In connection therewith, the Sub-Adviser will:
(i) manage the Assets or furnish recommendations to manage the Assets in
accordance with the Fund's investment objective and policies;
(ii) make investment decisions or recommendations with respect to the
Assets;
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<Page>
(iii) if requested by CSAM will place purchase and sale orders for
securities on behalf of the Fund with respect to the Assets;
(iv) exercise voting rights with respect to the Assets if requested by
CSAM; and
(v) furnish CSAM and the Fund's Board of Directors with such periodic
and special reports as the Fund or CSAM may reasonably request.
In providing those services, the Sub-Adviser will, if requested by CSAM,
provide investment research and supervision of the Assets and conduct a
continued program of investment, evaluation and, if appropriate, sale and
reinvestment of the Assets.
(b) In connection with the performance of the services of the Sub-Adviser
provided for herein, the Sub-Adviser may contract at its own expense with third
parties for the acquisition of research, clerical services and other
administrative services that would not require such parties to be required to
register as an investment adviser under the Advisers Act; provided that the
Sub-Adviser shall remain liable for the performance of its duties hereunder.
3. EXECUTION OF TRANSACTIONS
(a) In executing transactions for the Assets, selecting brokers or dealers
and negotiating any brokerage commission rates, the Sub-Adviser will use its
best efforts to seek the best overall terms available. In assessing the best
overall terms available for any portfolio transaction, the Sub-Adviser will
consider all factors it deems relevant including, but not limited to, the
breadth of the market in the security, the price of the security, the financial
condition and execution capability of the broker or dealer and the
reasonableness of any commission for the specific transaction and for
transactions executed through the broker or dealer in the aggregate. In
selecting brokers or dealers to execute a particular transaction and in
evaluating the best overall terms available, to the extent that the execution
and price offered by more than one broker or dealer are comparable the
Sub-Adviser may consider any brokerage and research services (as those terms are
defined in Section 28(e) of the Securities Exchange Act of 1934) provided to the
Sub-Adviser or to CSAM for use on behalf of the Fund or other clients of the
Sub-Adviser or CSAM.
(b) It is understood that the services of the Sub-Adviser are not exclusive,
and nothing in this Agreement shall prevent the Sub-Adviser from providing
similar services to other investment companies or from engaging in other
activities, provided that those activities do not adversely affect the ability
of the Sub-Adviser to perform its services under this Agreement. The Fund and
CSAM further understand and acknowledge that the persons employed by the
Sub-Adviser to assist in the performance of its duties under this Agreement will
not devote their full time to that service. Nothing contained in this Agreement
will be deemed to limit or restrict the right of the Sub-Adviser or any
affiliate of the Sub-Adviser to engage in and devote time and attention to other
businesses or to render services of whatever kind or nature, provided that doing
so does not adversely affect the ability of the Sub-Adviser to perform its
services under this Agreement.
(c) On occasions when the Sub-Adviser deems the purchase or sale of a
security to be in the best interest of the Fund as well as of other investment
advisory clients of the Sub-Adviser, the Sub-Adviser may, to the extent
permitted by applicable laws and regulations, but shall not be obligated to,
aggregate the securities to be so sold or purchased with those of its other
clients. In such event, allocation of the securities so purchased or sold, as
well as the expenses incurred in the transaction, will be made by the
A-2
<Page>
Sub-Adviser in a manner that is fair and equitable, in the judgment of the
Sub-Adviser, in the exercise of its fiduciary obligations to the Fund and to
such other clients. The Sub-Adviser shall provide to CSAM and the Fund all
information reasonably requested by CSAM and the Fund relating to the decisions
made by the Sub-Adviser regarding allocation of securities purchased or sold, as
well as the expenses incurred in a transaction, among the Fund and the
Sub-Adviser's other investment advisory clients.
(d) In connection with the purchase and sale of securities for the Fund, the
Sub-Adviser will provide such information as may be reasonably necessary to
enable the custodian and co-administrators to perform their administrative and
recordkeeping responsibilities with respect to the Fund.
4. DISCLOSURE REGARDING THE SUB-ADVISER
(a) The Sub-Adviser has reviewed the disclosure about the Sub-Adviser
contained in the Fund's proxy statement used in seeking shareholder approval for
this Agreement and represents and warrants that, with respect to such disclosure
about the Sub-Adviser or information related, directly or indirectly, to the
Sub-Adviser, such proxy statement contains, as of the date hereof, no untrue
statement of any material fact and does not omit any statement of a material
fact which is required to be stated therein or necessary to make the statements
contained therein not misleading.
(b) The Sub-Adviser agrees to notify CSAM and the Fund promptly of (i) any
statement about the Sub-Adviser contained in the Registration Statement that
becomes untrue in any material respect, (ii) any omission of a material fact
about the Sub-Adviser in the Registration Statement which is required to be
stated therein or necessary to make the statements contained therein not
misleading, or (iii) any reorganization or change in the Sub-Adviser, including
any change in its ownership or key employees.
(c) Prior to the Fund or CSAM or any affiliated person (as defined in the
1940 Act, an "Affiliate") of either using or distributing sales literature or
other promotional material referring to the Sub-Adviser ("Promotional
Material"), the Fund or CSAM, where applicable, shall forward such material to
the Sub-Adviser and shall allow the Sub-Adviser reasonable time to review the
material. The Sub-Adviser will not act unreasonably in its review of Promotional
Material and the Fund or CSAM, where applicable, will use all reasonable efforts
to ensure that all Promotional Material used or distributed by or on behalf of
the Fund or CSAM will comply with the requirements of the Advisers Act, the 1940
Act and the rules and regulations promulgated thereunder.
(d) The Sub-Adviser has supplied CSAM and the Fund copies of its Form ADV
with all exhibits and attachments thereto and will hereinafter supply CSAM and
the Fund, promptly upon preparation thereof, copies of all amendments or
restatements of such document.
5. REPRESENTATIONS AND WARRANTIES
5.1 The Sub-Adviser represents and warrants that:
(a) it is a duly registered investment adviser under the Advisers Act, a
duly registered investment adviser in any and all states of the United States in
which the Sub-Adviser is required to be so registered and has obtained all
necessary licenses and approvals in order to perform the services provided in
this Agreement. The Sub-Adviser covenants to maintain all necessary
registrations, licenses and approvals in effect during the term of this
Agreement.
A-3
<Page>
(b) it has read and understands the Registration Statement and warrants that
in investing the Fund's assets it will use all reasonable efforts to adhere to
the Fund's investment objectives, policies and restrictions contained therein.
(c) it has adopted a written Code of Ethics in compliance with Rule 17j-1
under the 1940 Act and will provide the Fund with any amendments to such Code.
5.2 The Fund represents and warrants that:
(a) it has full power to enter into the terms of this Agreement and to enter
into transactions contemplated by this Agreement and that its entry into the
Agreement nor the exercise by the Fund of its discretions or powers under this
Agreement will result in any default under any contract or other agreement or
instrument to which the Fund is a party, or any statute or rule, regulation or
order of any governmental agency or body applicable to the Fund.
(b) information which has been provided to the Sub-Adviser in relation to
the Fund's status, residence and domicile for taxation purposes is complete and
correct, and the Fund agrees to provide any further information properly
required by any competent authority.
(c) it will notify the Sub-Adviser promptly if there is any material change
in any of the above information and will provide such other relevant information
as the Sub-Adviser may reasonably request in order to fulfill its regulatory and
contractual obligations. The Fund acknowledges that a failure to provide such
information may adversely affect the quality of the services that the
Sub-Adviser may provide.
5.3 CSAM represents and warrants that:
it has full power to enter into the terms of this Agreement and to enter
into transactions contemplated by this Agreement and that neither its entry into
the Agreement nor the exercise by CSAM of its discretions or powers under this
Agreement will result in any default under any contract or other agreement or
instrument to which CSAM is a party, or any statute or rule, regulation or order
of any governmental agency or body applicable to CSAM.
6. COMPLIANCE
(a) The Sub-Adviser agrees that it shall promptly notify CSAM and the Fund
(i) in the event that the SEC or any other regulatory authority has censured its
activities, functions or operations; suspended or revoked its registration as an
investment adviser; or has commenced proceedings or an investigation that may
result in any of these actions, (ii) in the event that there is a change in the
Sub-Adviser, financial or otherwise, that adversely affects its ability to
perform services under this Agreement or (iii) upon having a reasonable basis
for believing that, as a result of the Sub-Adviser's investing the Fund's
assets, the Fund's investment portfolio has ceased to adhere to the Fund's
investment objectives, policies and restrictions as stated in the Registration
Statement or is otherwise in violation of applicable law.
(b) CSAM agrees that it shall promptly notify the Sub-Adviser in the event
that the SEC has censured CSAM or the Fund; placed limitations upon any of their
activities, functions or operations; suspended or revoked CSAM's registration as
an investment adviser; or has commenced proceedings or an investigation that may
result in any of these actions.
(c) The Fund and CSAM shall be given access to the records with respect to
the Fund of the Sub-Adviser at reasonable times solely for the purpose of
monitoring compliance with the terms of this
A-4
<Page>
Agreement and the rules and regulations applicable to the Sub-Adviser relating
to its providing investment advisory services to the Fund, including without
limitation records relating to trading by employees of the Sub-Adviser for their
own accounts and on behalf of other clients, provided that such access does not
constitute a breach of any obligation of client confidentiality held by the
Sub-Adviser. The Sub-Adviser agrees to cooperate with the Fund and CSAM and
their representatives in connection with any such monitoring efforts.
7. BOOKS AND RECORDS
(a) In compliance with the requirements of Rule 31a-3 under the 1940 Act,
the Sub-Adviser hereby agrees that all records which it maintains for the Fund
are the property of the Fund and further agrees to surrender promptly to the
Fund any of such records upon request. The Sub-Adviser further agrees to
preserve for the periods prescribed by Rule 31a-2 under the 1940 Act the records
required to be maintained by Rule 31a-1 under the 1940 Act and to preserve the
records required by Rule 204-2 under the Advisers Act for the period specified
therein.
(b) The Sub-Adviser hereby agrees to furnish to regulatory authorities
having the requisite authority any information or reports in connection with
services that the Sub-Adviser renders pursuant to this Agreement which may be
requested in order to ascertain whether the operations of the Fund are being
conducted in a manner consistent with applicable laws and regulations.
8. PROVISION OF INFORMATION; PROPRIETARY AND CONFIDENTIAL INFORMATION
(a) CSAM agrees that it will furnish to the Sub-Adviser information related
to or concerning the Fund that the Sub-Adviser may reasonably request
(b) The Sub-Adviser agrees on behalf of itself and its employees to treat
confidentially and as proprietary information of the Fund all records and other
information relative to the Fund, CSAM and prior, present or potential
shareholders and not to use such records and information for any purpose other
than performance of its responsibilities and duties hereunder except, where
practicable, after prior notification to and approval in writing of the Fund,
which approval shall not be unreasonably withheld and may not be withheld where
the Sub-Adviser may be exposed to civil or criminal contempt proceedings for
failure to comply or when requested to divulge such information by duly
constituted authorities.
(c) The Sub-Adviser represents and warrants that neither it nor any
affiliate will use the name of the Fund, CSAM or any of their affiliates in any
prospectus, sales literature or other material in any manner without the prior
written approval of the Fund or CSAM, as applicable.
9. STANDARD OF CARE
The Sub-Adviser shall exercise its best judgment in rendering the services
described herein. The Sub-Adviser shall not be liable for any error of judgment
or mistake of law or for any loss suffered by the Fund or CSAM in connection
with the matters to which this Agreement relates, except that the Sub-Adviser
shall be liable for a loss resulting from a breach of fiduciary duty by the
Sub-Adviser with respect to the receipt of compensation for services; provided
that nothing herein shall be deemed to protect or purport to protect the
Sub-Adviser against any liability to the Fund or CSAM or to shareholders of the
Fund to which the Sub-Adviser would otherwise be subject by reason of willful
misfeasance, bad faith or gross negligence on its part in the performance of its
duties or by reason of the Sub-Adviser's reckless disregard of its obligations
and duties under this Agreement. The Fund and CSAM understand and agree that the
A-5
<Page>
Sub-Adviser may rely upon information furnished to it reasonably believed by the
Sub-Adviser to be accurate and reliable and, except as herein provided, the
Sub-Adviser shall not be accountable for loss suffered by the Fund by reason of
such reliance of the Sub-Adviser.
10. COMPENSATION
In consideration of the services rendered pursuant to this Agreement, CSAM
will pay the Sub-Adviser such amounts as the parties may agree upon from time to
time as set forth on Schedule A, as amended from time to time.
11. EXPENSES
(a) The Sub-Adviser will bear all expenses in connection with the
performance of its services under this Agreement, which shall not include the
Fund's expenses listed in paragraph 11(b).
(b) The Fund will bear certain other expenses to be incurred in its
operation, including: investment advisory and administration fees; taxes,
interest, brokerage fees and commissions, if any; fees of Directors of the Fund
who are not officers, directors, or employees of CSAM or the Sub-Adviser or
affiliates of any of them; fees of any pricing service employed to value assets
of the Fund; SEC fees, state Blue Sky qualification fees and any foreign
qualification fees; charges of custodians and transfer and dividend disbursing
agents; the Fund's proportionate share of insurance premiums; outside auditing
and legal expenses; costs of maintenance of the Fund's existence; costs
attributable to investor services, including, without limitation, telephone and
personnel expenses: costs of preparing and printing prospectuses and statements
of additional information for regulatory purposes and for distribution to
existing shareholders; costs of shareholders' reports and meetings of the
shareholders of the Fund and of the officers or Board of Directors of the Fund;
and any extraordinary expenses.
12. TERM OF AGREEMENT
This Agreement shall commence on the date first written above and shall
continue for an initial two-year period commencing on the date first written
above, and thereafter shall continue automatically for successive annual
periods, provided such continuance is specifically approved at least annually by
(a) the Board of Directors of the Fund or (b) a vote of a "majority" (as defined
in the 1940 Act) of the Fund's outstanding voting securities, provided that in
either event the continuance is also approved by a majority of the Board of
Directors who are not "interested persons" (as defined the 1940 Act) of any
party to this Agreement, by vote cast in person at a meeting called for the
purpose of voting on such approval. This Agreement is terminable, without
penalty, (i) by CSAM on 60 (sixty) days' written notice to the Fund and the
Sub-Adviser, (ii) by the Board of Directors of the Fund or by vote of holders of
a majority of the Fund's shares on 60 (sixty) days' written notice to CSAM and
the Sub-Adviser, or (iii) by the Sub-Adviser upon 60 (sixty) days' written
notice to the Fund and CSAM. This Agreement will also terminate automatically in
the event of its assignment (as defined in the 1940 Act) by any party hereto. In
the event of termination of this Agreement for any reason, all records relating
to the Fund kept by the Sub-Adviser shall promptly be returned to CSAM or the
Fund, free from any claim or retention of rights in such records by the Sub-
Adviser. In the event this Agreement is terminated or is not approved in the
foregoing manner, the provisions contained in paragraph numbers 4(c), 7, 8 and 9
shall remain in effect.
13. AMENDMENTS
No provision of this Agreement may be changed, waived, discharged or
terminated orally, but only by an instrument in writing signed by the party
against which enforcement of the change, waiver, discharge or
A-6
<Page>
termination is sought, and no amendment of this Agreement shall be effective
until approved by an affirmative vote of (a) the holders of a majority of the
outstanding voting securities of the Fund and (b) the Board of Directors of the
Fund, including a majority of Directors who are not "interested persons" (as
defined in the 1940 Act) of the Fund or of either party to this Agreement, by
vote cast in person at a meeting called for the purpose of voting on such
approval, if such approval is required by applicable law.
14. NOTICES
14.1 All communications hereunder shall be given (a) if to the Sub-Adviser,
to Credit Suisse Asset Management (Australia) Limited, Level 32, Gateway
Building, 1 Macquarie Place, SYDNEY NSW AUSTRALIA Attention: Annete Golden),
telephone: 612 8205 4080 facsimile: 612-8205 4993, email,
annette.k.golden@csam.com (b) if to CSAM, to Credit Suisse Asset Management,
LLC, 466 Lexington Avenue, New York, New York 10017-3147 (Attention: Hal
Liebes), telephone: (212) 875-3779, telecopy: (646) 658-0817, and (c) if to the
Fund, c/o Credit Suisse Funds, 466 Lexington Avenue, New York, New York
10017-3147, telephone: (212) 875-3500, telecopy: (212) 878-9351 (Attention:
President).
14.2 The Sub-Adviser may rely on, and act without further enquiry upon, any
instruction, notice or request of any person(s) who is or who the Sub-Adviser
reasonably believes in good faith to be person(s) designated by CSAM or the Fund
to give such instruction, notice or request, and further provided that such
instruction, notice or request is made in writing and sent by original signed
letter, facsimile or electronic means in accordance with the provisions of
Clause 14.1.
14.3 CSAM and the Fund will provide a list of person(s) who are authorized
to give instructions and sign documents and take other actions in respect of the
Assets. CSAM or the Fund shall notify the Sub-Adviser promptly of any amendment
to such list and provide specimen signatures of new signatories, and the
Sub-Adviser shall accept any such amendments.
15. CHOICE OF LAW
This Agreement shall be governed by, and construed in accordance with, the
laws of the State of New York in the United States, including choice of law
principles; provided that nothing herein shall be construed in a manner
inconsistent with the 1940 Act, the Advisers Act or any applicable rules,
regulations or orders of the SEC.
16. MISCELLANEOUS
(a) The captions of this Agreement are included for convenience only and in
no way define or limit any of the provisions herein or otherwise affect their
construction or effect.
(b) If any provision of this Agreement shall be held or made invalid by a
court decision, by statute or otherwise, the remainder of this Agreement shall
not be affected thereby and, to this extent, the provisions of this Agreement
shall be deemed to be severable.
(c) Nothing herein shall be construed to make the Sub-Adviser an agent of
CSAM or the Fund.
(d) This Agreement may be executed in counterparts, with the same effect as
if the signatures were upon the same instrument.
******************
[SIGNATURE PAGE FOLLOWS]
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<Page>
Please confirm that the foregoing is in accordance with your understanding
by indicating your acceptance hereof at the place below indicated, whereupon it
shall become a binding agreement between us.
<Table>
Very truly yours,
CREDIT SUISSE ASSET MANAGEMENT, LLC
By:
------------------------------------------
Name: Hal Liebes
Title: Managing Director
THE INDONESIA FUND, INC.
By:
------------------------------------------
Name: Michael A. Pignataro
Title: Chief Financial Officer
</Table>
CREDIT SUISSE ASSET
MANAGEMENT (AUSTRALIA) LIMITED,
ABN 57 007 305 384, in accordance with its Articles of Association
- ---------------------------------
Director
- ---------------------------------
Director/Secretary
A-8
<Page>
SCHEDULE A
CSAM will pay the Sub-Adviser a quarterly fee equal to 90% of the net
quarterly amount received by CSAM as the Fund's investment adviser. Such fee
shall be payable in U.S. dollars in arrears on the last business day of each
calendar quarter. The fee for the first period during which this Agreement is in
effect shall be pro-rated for the portion of the calendar quarter that the
Agreement is in effect. The fee shall be an aggregate fee paid for services
rendered with respect to this Fund.
A-9
<Page>
THE INDONESIA FUND, INC.
------------------------------------------------------------------
OCTOBER 9, 2002
3913-PS-02
<Page>
[PROXY CARD]
THE INDONESIA FUND, INC.
466 Lexington Avenue
16th Floor
New York, New York 100017
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
I hereby appoint Michael A. Pignataro and Hal Liebes, each with the power of
substitution, as proxies for the undersigned to vote the shares of The Indonesia
Fund, Inc. (the "Fund") as to which I am entitled to vote, as shown on the
reverse side, at the Annual Meeting of Shareholders of the Fund (the "Meeting")
to be held on October 9, 2002, at 1:00 p.m., Eastern Time, at the offices of the
Fund, 466 Lexington Avenue, 16th Floor, New York, New York 10017, and any
adjournments thereof.
<Page>
[REVERSE SIDE]
|X| PLEASE MARK VOTES
AS IN THIS EXAMPLE
THE BOARD OF DIRECTORS OF THE FUND UNANIMOUSLY RECOMMENDS A VOTE FOR PROPOSALS 1
AND 2.
<Table>
THIS PROXY WHEN For Against Abstain
PROPERLY EXECUTED 1) To approve the Sub-Investment Advisory Agreement among the Fund, | | | | | |
WILL BE VOTED IN THE Credit Suisse Asset Management, LLC and Credit Suisse Asset
MANNER DIRECTED Management (Australia) Limited.
HEREIN BY THE
UNDERSIGNED
SHAREHOLDER. IF NO
DIRECTION IS MADE, THIS
PROXY WILL BE VOTED
"FOR" PROPOSALS 1 AND
2.
2) Election of the following nominees as Directors:
Nominee: (01) Lawrence J. Fox (three-year term)
(02) Laurence R. Smith (three-year term)
| | FOR the nominees listed above (except as marked to the contrary above)
| | WITHHOLD AUTHORITY to vote for the nominees listed above
(INSTRUCTION: To withhold authority for any individual nominee, strike a
line through such individual's name above.)
3) To transact such other business as may properly come before the Meeting or
any adjournment thereof.
MARK HERE FOR ADDRESS CHANGE AND NOTE AT LEFT
| |
</Table>
Please sign exactly as name appears at left. When shares are held by joint
tenants, both should sign. When signing as attorney, executor, administrator,
trustee or guardian, please give full title as such. If a corporation, please
sign in full corporate name by president or other authorized officer. If a
partnership, please sign in partnership name by authorized person.
Signature: ___________________ Date: ________
Signature: ___________________ Date: ________
DETACH CARD