Schedule 14A Information required in proxy statement.
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:
[ X ] Preliminary Proxy Statement
[ ] Preliminary Additional Materials
[ ] Confidential, for Use of the Commission Only (as permitted
by Rule 14a-6(e)(2))
[ ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Section 240.149-11(c) or
Section 240.14a-12
.... TCW/DW Emerging Markets Opportunities Trust....... . . . . .
(Name of Registrant(s) Specified in its Charter)
.... Frank J. Bruttomesso. . . . . . . . . . . . . . . . . . . . .
(Name of Person(s) Filing Proxy Statement)
Payment of Filing Fee (check the appropriate box):
[ X ] No fee required.
[ ] Fee computed on table below per Exchange Act Rules
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applies:
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2) Aggregate number of securities to which transaction applies:
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3) Per unit price or other underlying value of transaction
computed pursuant to Exchange Act Rule 0-11:
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Set forth the amount on which the filing fee is calculated and state
how it was determined.
4) Proposed maximum aggregate value of transaction:
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[ ] Check box if any part of the fee is offset as provided by
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TCW/DW EMERGING MARKETS OPPORTUNITIES TRUST
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD JUNE 24, 1997
The Annual Meeting of Shareholders of TCW/DW EMERGING MARKETS
OPPORTUNITIES TRUST (the "Trust"), an unincorporated business trust organized
under the laws of the Commonwealth of Massachusetts, will be held in the
Career Development Room, Sixty-first Floor, 2 World Trade Center, New York,
New York 10048, on June 24, 1997 at 10:00 a.m., New York City time, for the
following purposes:
1. To elect two (2) Trustees to serve until the 2000 Annual Meeting
or, in each case, until their successors shall have been elected and
qualified;
2. To approve or disapprove the continuance of the currently effective
Investment Advisory Agreement between the Trust and TCW Funds
Management, Inc.;
3. To ratify or reject the selection of Price Waterhouse LLP as the
Trust's independent accountants for the fiscal year ending January 31,
1998;
4. To approve or disapprove a shareholder proposal recommending the
Board of Trustees take action to convert the Trust from a closed-end to
an open-end status;
5. If Proposal No. 4 is approved, to approve the conversion of the
Trust from a closed-end investment company to an open-end investment
company and to amend the Trust's Declaration of Trust;
6. If Proposal No. 4 is approved, to elect nine (9) Trustees;
7. If Proposal No. 4 is approved, to approve a new Investment Advisory
Agreement between the Trust and TCW Funds Management, Inc.;
8. If Proposal No. 4 is approved, to approve a new Sub-Advisory
Agreement between TCW Funds Management, Inc. and TCW London
International Limited;
9. If Proposal No. 4 is approved, to approve a new Sub-Advisory
Agreement between TCW Funds Management, Inc. and TCW Asia Limited;
10. If Proposal No. 4 is approved, to approve a Plan of Distribution
pursuant to 12b-1 under the Investment Company Act of 1940, as amended;
and
11. To transact such other business as may properly come before the
Meeting or any adjournment thereof.
Shareholders of record as of the close of business on April 24, 1997 are
entitled to notice of and to vote at the Meeting. If you cannot be present in
person, your management would greatly appreciate your filling in, signing and
returning the enclosed proxy promptly in the envelope provided for that
purpose.
In the event that the necessary quorum to transact business or the vote
required to approve or reject any proposal is not obtained at the Meeting,
the persons named as proxies may propose one or more adjournments of the
meeting for a total of not more than 60 days in the aggregate to permit
further solicitation of proxies. Any such adjournment will require the
affirmative vote of the holders of a majority of the Trust's shares present
in person or by proxy at the Meeting. The persons named as proxies will vote
in favor of such adjournment those proxies which they are entitled to vote in
favor of Proposal 2 and will vote against any such adjournment those proxies
required to be voted against that proposal.
BARRY FINK,
Secretary
May [5], 1997
New York, New York
- -------------------------------------------------------------------------------
IMPORTANT
YOU CAN HELP THE TRUST AVOID THE NECESSITY AND EXPENSE OF SENDING FOLLOW-UP
LETTERS TO ENSURE A QUORUM BY PROMPTLY RETURNING THE ENCLOSED PROXY. IF YOU
ARE UNABLE TO BE PRESENT IN PERSON, PLEASE FILL IN, SIGN AND RETURN THE
ENCLOSED PROXY IN ORDER THAT THE NECESSARY QUORUM MAY BE REPRESENTED AT THE
MEETING. THE ENCLOSED ENVELOPE REQUIRES NO POSTAGE IF MAILED IN THE UNITED
STATES.
- -------------------------------------------------------------------------------
TCW/DW EMERGING MARKETS OPPORTUNITIES TRUST
TWO WORLD TRADE CENTER, NEW YORK, NEW YORK 10048
PROXY STATEMENT
ANNUAL MEETING OF SHAREHOLDERS
JUNE 24, 1997
This statement is furnished in connection with the solicitation of proxies
by the Trustees of TCW/DW EMERGING MARKETS OPPORTUNITIES TRUST (the "Trust")
for use at the Annual Meeting of Shareholders of the Trust to be held on June
24, 1997, and at any adjournments thereof.
If the enclosed form of proxy is properly executed and returned in time to
be voted at the meeting, the proxies named therein will vote the shares
represented by the proxy in accordance with the instructions marked thereon.
Unmarked proxies will be voted for each of the nominees for election as
Trustee in Proposals 1 and 6, in favor of Proposals 2, 3, 5, 7, 8, 9 and 10,
and in abstention for Proposal 4. A proxy may be revoked at any time prior to
its exercise by any of the following: written notice of revocation, execution
and delivery of a later dated proxy to the Secretary of the Trust (if
returned and received in time to be voted), or attendance and voting at the
Annual Meeting of Shareholders. Attendance at the Meeting will not in and of
itself revoke a proxy.
Shareholders as of the close of business on April 24, 1997, the record
date for the determination of shareholders entitled to notice of and to vote
at the Meeting, are entitled to one vote for each share held and a fractional
vote for a fractional share. On April 24, 1997 there were shares
of beneficial interest of the Trust outstanding, all with $0.01 par value.
[No person was known to own as much as 5% of the outstanding shares of the
Trust on that date.] The Trustees and Officers of the Trust, together, owned
less than 1% of the Trust's outstanding shares on that date. The percentage
ownership of shares of the Trust changes from time to time depending on
purchases and sales by shareholders and the total number of shares
outstanding.
The cost of soliciting proxies for this Annual Meeting of Shareholders,
consisting principally of printing and mailing expenses, which expenses are
not expected to exceed $16,000, will be borne by the Trust. The solicitation
of proxies will be by mail, which may be supplemented by solicitation by
mail, telephone or otherwise through Trustees, officers and regular employees
of the Trust, Dean Witter Services Company Inc. ("DWSC" or the "Manager") or
its parent company, Dean Witter InterCapital Inc. ("InterCapital"), without
special compensation therefor. In addition, the Trust may employ William F.
Doring and Co. as proxy solicitor, the cost of which is not expected to
exceed $3,000 and will be borne by the Trust. The first mailing of this proxy
statement is expected to be made on or about May [5], 1997.
2
(1) ELECTION OF TRUSTEES
The number of Trustees has been currently fixed by the Trustees, pursuant
to the Trust's Declaration of Trust, at nine. There are currently nine
Trustees, two of whom (Richard M. DeMartini and Thomas E. Larkin, Jr.) are
standing for election at this Meeting to serve until the 2000 Annual Meeting
in accordance with the Trust's Declaration of Trust.
Five of the current nine Trustees (John C. Argue, John R. Haire, Manuel H.
Johnson, Michael E. Nugent and John L. Schroeder) are Independent Trustees,
that is, Trustees who are not "interested persons" of the Trust, as that term
is defined in the Investment Company Act of 1940, as amended (the "1940
Act"). The nominees for election as Trustees of the Trust have been proposed
by the Trustees now serving or, in the case of the nominees for positions as
Independent Trustees, by the Independent Trustees now serving. All of the
Trustees have been elected by the Shareholders of the Trust.
The nominees of the Board of Trustees for election as Trustees are listed
below. It is the intention of the persons named in the enclosed form of proxy
to vote the shares represented by them for the election of these nominees:
Richard M. DeMartini and Thomas E. Larkin, Jr. Should any of the nominees
become unable or unwilling to accept nomination or election, the persons
named in the proxy will exercise their voting power in favor of such person
or persons as the Board of Trustees may recommend. All of the nominees have
consented to being named in this proxy statement and to serve if elected. The
Trust knows no reason why said nominees would be unable or unwilling to
accept nomination or election. Trustees will be elected by a majority of the
votes cast at the meeting.
Pursuant to the provisions of the Trust's Declaration of Trust, the
nominees for election as Trustees are divided into three separate classes,
each class having a term of three years. The term of office of one of each of
the three classes will expire each year.
The Board of Trustees has determined that the nominees for election as
Trustee shall be standing for election as Trustee in each of the three
classes of Trustee as follows: Class I--Messrs. Haire, Johnson, Schroeder and
Stern; Class II--Messrs. DeMartini and Larkin; and Class III--Messrs. Argue,
Fiumefreddo and Nugent. Each nominee will, if elected, serve a term of up to
approximately three years running for the period assigned to that class and
terminating at the date of the Annual Meeting of Shareholders so designated
by the Board of Trustees, or any adjournment thereof. As a consequence of
this method of election, the replacement of a majority of the Board could be
delayed for up to two years. In accordance with the above, the Class II
Trustees are standing for election at this Meeting and, if elected, will
serve until the 2000 Annual Meeting or until their successors shall have been
elected and qualified.
The following information regarding each of the nominees for election as
Trustee includes his principal occupations and employment for at least the
last five years, his age, shares of the Trust owned, if any, as of April 24,
1997 (shown in parentheses), positions with the Trust, and directorships (or
trusteeships) in companies which file periodic reports with the Securities
and Exchange Commission, including the 14 investment companies, including the
Trust, for which TCW Funds Management, Inc. serves as investment adviser (the
"Investment Adviser" or the "Adviser") and InterCapital's wholly-owned
subsidiary Dean Witter Services Company Inc. ("DWSC") serves as manager
(referred to herein as the "TCW/DW Funds"), and the 84 investment companies
for which InterCapital serves as investment manager or investment adviser
(referred to herein as the "Dean Witter Funds").
3
The nominees for Trustee to be elected at the Meeting are:
RICHARD M. DeMARTINI, * Trustee since December, 1993; age 44; President
and Chief Operating Officer of Dean Witter Capital, a division of Dean Witter
Reynolds Inc. ("DWR"); Director of DWR, the Manager, InterCapital, Dean
Witter Distributors Inc. ("Distributors") and Dean Witter Trust Company
("DWTC"); Executive Vice President of Dean Witter, Discover & Co. ("DWDC");
Member of the DWDC Management Committee; Trustee of the TCW/DW Funds;
formerly Vice Chairman of the Board of the National Association of Securities
Dealers, Inc.; formerly Chairman of the Board of the NASDAQ Market, Inc.
THOMAS E. LARKIN, Jr.,* Trustee since February 1994; age 57; Executive
Vice President and Director, the TCW Group, Inc.; President and Director of
Trust Company of the West; Vice Chairman and Director of TCW Asset Management
Company; Chairman of the Adviser; Member of the Board of Trustees of the
University of Notre Dame; Director Orthopaedic Hospital of Los Angeles;
President and Director of TCW Galileo Funds, Inc.; Senior Vice President of
TCW Convertible Securities Fund, Inc.; President and Trustee of the TCW/DW
Funds.
The Trustees who are not standing for reelection at this Meeting under
this proposal are:
JOHN C. ARGUE, Trustee since February, 1994; age 65; Of Counsel, Argue
Pearson Harbison & Myers (law firm); Director, Avery Dennison Corporation
(manufacturer of self-adhesive products and office supplies) and CalMat
Company (producer of aggregates, asphalt and ready mixed concrete); Director,
Coast Savings Financial Inc. and Coast Federal Bank (a subsidiary of Coast
Savings Financial Inc.); Chairman, Rose Hills Foundation (charitable
foundation); advisory director, LAACO Ltd. (owner and operator of private
clubs and real estate); director or trustee of various business and
not-for-profit corporations; Director, TCW Funds, Inc.; Trustee, University
of Southern California, Occidental College and Pomona College; Trustee of the
TCW/DW Funds.
CHARLES A. FIUMEFREDDO,* Trustee since December, 1993; age 63; Chairman,
Chief Executive Officer and Director of InterCapital, DWSC and Distributors;
Executive Vice President and Director of DWR; Chairman, Director or Trustee,
President and Chief Executive Officer of the investment companies of which
InterCapital serves as investment manager (or as adviser and administrator)
(the "Dean Witter Funds"); Chairman, Chief Executive Officer and Trustee of
the TCW/DW Funds; Chairman and Director of DWTC; Director and/or officer of
various DWDC subsidiaries; formerly Executive Vice President and Director of
DWDC (until February 1993).
JOHN R. HAIRE, Trustee since February, 1994; age 72; Chairman of the Audit
Committee and Chairman of the Committee of the Independent Directors or
Trustees and Director or Trustee of the Dean Witter Funds; Chairman of the
Audit Committee and Chairman of the Committee of the Independent Trustees and
Trustee of the TCW/DW Funds; formerly President, Council for Aid to Education
(1978-1989) and Chairman and Chief Executive Officer of Anchor Corporation,
an investment adviser (1964-1978); Director of Washington National
Corporation (insurance).
DR. MANUEL H. JOHNSON, Trustee since February 1994; age 48; Senior
Partner, Johnson Smick International, Inc., a consulting firm; Co-Chairman
and a founder of the Group of Seven Council (G7C), an international economic
commission; Director or Trustee of the Dean Witter Funds; Trustee of the
TCW/DW
- ------------
* Messrs. DeMartini, Fiumefreddo, Larkin and Stern may be deemed "interested
persons" of the Trust and/or its Investment Adviser as defined in Section
2(a)(19) of the 1940 Act, due to their affiliation with the Investment
Adviser or Manager and/or their affiliated companies.
4
Funds; Director of NASDAQ (since June 1995); Director of Greenwich Capital
Markets, Inc. (broker-dealer); Trustee of the Financial Accounting Foundation
(oversight organization for the FASB); formerly Vice Chairman of the Board of
Governors of the Federal Reserve System (1986-1990) and Assistant Secretary
of the U.S. Treasury (1982-1986).
MICHAEL E. NUGENT, Trustee since February, 1994; age 60; General Partner,
Triumph Capital, L.P., a private investment partnership; Director or Trustee
of the Dean Witter Funds; Trustee of the TCW/DW Funds; formerly Vice
President, Bankers Trust Company and BT Capital Corporation (1984-1988);
Director of various business organizations.
JOHN L. SCHROEDER, Trustee since April 1995; age 66; Retired; Director or
Trustee of the Dean Witter Funds; Trustee of the TCW/DW Funds; Director of
Citizens Utilities Company; formerly Executive Vice
President and Chief Investment Officer of The Home Insurance Company (August
1991-September 1995).
MARC I. STERN,* Trustee since April, 1995; age 53; Vice President of the
Trust; President and Director, The TCW Group, Inc. (since May 1992);
President and Director of the Adviser (since May 1992); Vice Chairman and
Director of TCW Asset Management Company (since May, 1992); Chairman and
Director of TCW Galileo Funds, Inc.; Trustee of the TCW/DW Funds; Chairman of
TCW Americas Development, Inc.; Executive Vice President and Director, Trust
Company of the West (since November 1990). Chairman of TCW Asia, Limited
(since January 1993); Chairman of TCW London International, Limited (since
March, 1993); Director of Qualcomm, Incorporated (wireless communications);
Director or Trustee of various not-for-profit organizations; formerly
President of SunAmerica, Inc. (financial services company).
The executive officers of the Trust are: Barry Fink, Vice President,
Secretary and General Counsel; Robert M. Scanlan, Vice President; Robert S.
Giambrone, Vice President; Joseph J. McAlinden, Vice President; Shaun C.K.
Chan, Vice President; Michael P. Reilly, Vice President; Terence F. Mahony,
Vice President; and Thomas F. Caloia, Treasurer. In addition, Marilyn K.
Cranney, Lou Anne D. McInnis, Carsten Otto, Ruth Rossi and Frank Bruttomesso
serve as Assistant Secretaries. Mr. Fink is 42 years old and is currently
Senior Vice President (since June 1993), Secretary and General Counsel (since
February 1997) of InterCapital and DWSC and Assistant Secretary of DWR (since
August 1996); he is also Senior Vice President, Assistant Secretary and
Assistant General Counsel of Distributors. He has been an employee of
InterCapital for over five years. Mr. Scanlan is 60 years old and is
currently President and Chief Operating Officer of InterCapital (since March
1993) and DWSC; he is also Executive Vice President of Distributors and
Executive Vice President and Director of DWTC. He was previously Executive
Vice President of InterCapital (July 1992-March 1993) and prior thereto was
Chairman of Harborview Group, Inc. Mr. Giambrone is 42 years old and is
currently Senior Vice President of InterCapital, DWSC, Distributors and DWTC
(since August 1995); he is also a Director of DWTC (since April, 1996). He
was formerly a partner of KPMG Peat Marwick, LLP. Mr. McAlinden is 54 years
old and is currently Executive Vice President and a Director of DWTC (since
April 1996); he is also Chief Investment Officer of InterCapital. He was
previously Senior Vice President of InterCapital (June 1995-April 1996).
Prior to that he was a Managing Director of Dillon Reed. Mr. Chan is 34 years
old and is currently a Managing Director of the Adviser, TCW Asset Management
Co. and Trust Company of the West and President and Director of TCW Asia
Limited. He was previously the Regional Strategist and a Director of Wardley
Investment Services (1986-1993). Mr. Reilly is 33 years old and is currently
a Managing Director of the Adviser, TCW Asset Management Co. and Trust
Company of the West. He was previously a Vice President of Security Pacific
Bank (until 1992). Mr Mahony is 59 years old and is currently a Managing
Director of the Adviser, TCW Asset Management Co. and Trust Company of the
West and head of Emerging Markets Equities of the Adviser, TCW Asset
Management Co. and Trust Company of the West. Mr. Caloia is 51 years old and
is currently First Vice President and Assistant Treasurer of InterCapital and
DWSC. He has been an employee of InterCapital or DWR for over five years.
5
THE BOARD OF TRUSTEES, THE INDEPENDENT TRUSTEES, AND THE COMMITTEES
The Board of Trustees consists of nine (9) trustees. These same
individuals also serve as trustees for all of the TCW/DW Funds. As of the
date of this Proxy Statement, there are a total of 14 TCW/DW Funds. As of
March 31, 1997, the TCW/DW Funds had total net assets of approximately $4
billion and approximately a quarter of a million shareholders.
Five Trustees (56% of the total number) have no affiliation or business
connection with TCW Funds Management, Inc. or Dean Witter Services Company
Inc. or any of their affiliated persons and do not own any stock or other
securities issued by DWDC or TCW, the parent companies of Dean Witter
Services Company Inc. and TCW Funds Management, Inc., respectively. These are
the "disinterested" or "independent" Trustees. The other four Trustees (the
"Management Trustees") are affiliated with either Dean Witter Services
Company Inc. or TCW. Four of the five independent Trustees are also
Independent Trustees of the Dean Witter Funds.
Law and regulation establish both general guidelines and specific duties
for the Independent Trustees. The TCW/DW Funds seek as Independent Trustees
individuals of distinction and experience in business and finance, government
service or academia; these are people whose advice and counsel are in demand
by others and for whom there is often competition. To accept a position on
the Funds' Boards, such individuals may reject other attractive assignments
because the Funds make substantial demands on their time. Indeed, by serving
on the Funds' Boards, certain Trustees who would otherwise be qualified and
in demand to serve on bank boards would be prohibited by law from doing so.
All of the Independent Trustees serve as members of the Audit Committee
and the Committee of the Independent Trustees. Three of them also serve as
members of the Derivatives Committee. The Committees hold some meetings at
the offices of the Manager or Adviser and some outside those offices.
Management Trustees or officers do not attend these meetings unless they are
invited for purposes of furnishing information or making a report. There are
no nominating or compensation Committees of the Trustees.
The Committee of the Independent Trustees is charged with recommending to
the full Board approval of management, advisory and administration contracts,
Rule 12b-1 plans and distribution and underwriting agreements; continually
reviewing Fund performance; checking on the pricing of portfolio securities,
brokerage commissions, transfer agent costs and performance, and trading
among Funds in the same complex; and approving fidelity bond and related
insurance coverage and allocations, as well as other matters that arise from
time to time. The Independent Trustees are required to select and nominate
individuals to fill any Independent Trustee vacancy on the Board of any Fund
that has a Rule 12b-1 plan of distribution. Each of the open-end TCW/DW Funds
has such a plan.
The Audit Committee is charged with recommending to the full Board the
engagement or discharge of the Fund's independent accountants; directing
investigations into matters within the scope of the independent accountants'
duties, including the power to retain outside specialists; reviewing with the
independent accountants the audit plan and results of the auditing
engagement; approving professional services provided by the independent
accountants and other accounting firms prior to the performance of such
services; reviewing the independence of the independent accountants;
considering the range of audit and non-audit fees; reviewing the adequacy of
the Fund's system of internal controls; and preparing and submitting
Committee meeting minutes to the full Board.
Finally, the Board of each Fund has formed a Derivatives Committee to
establish parameters for and oversee the activities of the Fund with respect
to derivative investments, if any, made by the Fund.
For the fiscal year ended January 31, 1997, the Board of Trustees of the
Trust held 7 meetings, and the Audit Committee, the Committee of the
Independent Trustees and the Derivatives Committee of the Trust held 2, 9,
and 4 meetings, respectively. No Trustee attended fewer than 75% of the
meetings of the Board of Trustees, the Audit Committee or the Derivatives
Committee held while he served in such positions.
6
DUTIES OF CHAIRMAN OF COMMITTEE OF THE INDEPENDENT TRUSTEES AND AUDIT
COMMITTEE
The Chairman of the Committees maintains an office in the Funds'
headquarters in New York. He is responsible for keeping abreast of regulatory
and industry developments and the Funds' operations and management. He
screens and/or prepares written materials and identifies critical issues for
the Independent Trustees to consider, develops agendas for Committee
meetings, determines the type and amount of information that the Committees
will need to form a judgment on various issues, and arranges to have that
information furnished to Committee members. He also arranges for the services
of independent experts and consults with them in advance of meetings to help
refine reports and to focus on critical issues. Members of the Committees
believe that the person who serves as Chairman of both Committees and guides
their efforts is pivotal to the effective functioning of the Committees.
The Chairman of the Committees also maintains continuous contact with the
Funds' management, with independent counsel to the Independent Trustees and
with the Funds' independent auditors. He arranges for a series of special
meetings involving the annual review of investment advisory, management and
other operating contracts of the Funds and, on behalf of the Committees,
conducts negotiations with the Investment Adviser and the Manager and other
service providers. In effect, the Chairman of the Committees serves as a
combination of chief executive and support staff of the Independent Trustees.
The Chairman of the Committee of the Independent Trustees and the Audit
Committee is not employed by any other organization and devotes his time
primarily to the services he performs as Committee Chairman and Independent
Trustee of the TCW/DW Funds and as Chairman of the Committee of the
Independent Trustees and the Audit Committee and Independent Director or
Trustee of the Dean Witter Funds. The current Committee Chairman has had more
than 35 years experience as a senior executive in the investment company
industry.
ADVANTAGES OF HAVING SAME INDIVIDUALS AS INDEPENDENT TRUSTEES FOR ALL TCW/DW
FUNDS
The Independent Trustees and the Funds' management believe that having the
same Independent Trustees for each of the TCW/DW Funds avoids the duplication
of effort that would arise from having different groups of individuals
serving as Independent Trustees for each of the Funds or even of sub-groups
of Funds. They believe that having the same individuals serve as Independent
Trustees of all the Funds tends to increase their knowledge and expertise
regarding matters which affect the Fund complex generally and enhances their
ability to negotiate on behalf of each Fund with the Fund's service
providers. This arrangement also precludes the possibility of separate groups
of Independent Trustees arriving at conflicting decisions regarding
operations and management of the Funds and avoids the cost and confusion that
would likely ensue. Finally, having the same Independent Trustees serve on
all Fund Boards enhances the ability of each Fund to obtain, at modest cost
to each separate Fund, the services of Independent Trustees, and a Chairman
of their Committees, of the caliber, experience and business acumen of the
individuals who serve as Independent Trustees of the TCW/DW Funds.
SHARE OWNERSHIP BY TRUSTEES
The Trustees have adopted a policy pursuant to which each Trustee and/or
his or her spouse is required to invest at least $25,000 in any of the Funds
in the TCW/DW Funds complex (and, if applicable, in the Dean Witter Funds
complex) on whose boards the Trustee serves. In addition, the policy
contemplates that the Trustees will, over time, increase their aggregate
investment in the Funds above the $25,000 minimum requirement. The Trustees
may allocate their investments among specific Funds in any manner they
determine is appropriate based on their individual investment objectives. As
of the date of this proxy statement, each Trustee is in compliance with the
policy. Any future Trustee will be given a one year period following his or
her
7
election within which to comply with the foregoing. As of March 31, 1997, the
total value of the investments by the Trustees and/or their spouses in shares
of the TCW/DW Funds (and, if applicable, the Dean Witter Funds) was
approximately $ million.
As of April 24, 1997, the aggregate number of shares of beneficial
interest of the Trust owned by the Trust's officers and Trustees as a group
was less than 1 percent of the Trust's shares of beneficial interest
outstanding.
COMPENSATION OF INDEPENDENT TRUSTEES
The Trust pays each Independent Trustee an annual fee of $2,225 plus a per
meeting fee of $200 for meetings of the Board of Trustees or committees of
the Board of Trustees attended by the Trustee (the Trust pays the Chairman of
the Audit Committee an annual fee of $750 and pays the Chairman of the
Committee of the Independent Trustees an additional annual fee of $1,200).
The Trust also reimburses such Trustees for travel and other out-of-pocket
expenses incurred by them in connection with attending such meetings.
Trustees and officers of the Trust who are or have been employed by the
Manager or the Adviser or an affiliated company of either receive no
compensation or expense reimbursement from the Trust. The Trustees of the
TCW/DW Funds do not have retirement or deferred compensation plans.
The following table illustrates the compensation paid to the Fund's
Independent Trustees by the Trust for the fiscal year ended January 31, 1997.
TRUST COMPENSATION
AGGREGATE
COMPENSATION
NAME OF INDEPENDENT TRUSTEE FROM THE FUND
- --------------------------- ---------------
John C. Argue............... $5,291
John R. Haire............... 6,553
Dr. Manuel H. Johnson....... 5,274
Michael E. Nugent........... 5,054
John L. Schroeder........... 5,491
The following table illustrates the compensation paid to the Fund's
Independent Trustees for the calendar year ended December 31, 1996 for
services to the 14 TCW/DW Funds and, in the case of Messrs. Haire, Johnson,
Nugent and Schroeder, the 82 Dean Witter Funds that were in operation at
December 31, 1996, and, in the case of Mr. Argue, TCW Galileo Funds, Inc.
With respect to Messrs. Haire, Johnson, Nugent and Schroeder, the Dean Witter
Funds are included solely because of a limited exchange privilege between
various TCW/DW Funds and five Dean Witter Money Market Funds. With respect to
Mr. Argue, TCW Galileo Funds, Inc. is included solely because the Fund's
Adviser, TCW Funds Management, Inc., also serves as Adviser to that
investment company.
8
CASH COMPENSATION FROM FUND GROUPS
FOR SERVICE AS
FOR SERVICES AS CHAIRMAN OF
CHAIRMAN OF COMMITTEES OF
FOR SERVICE COMMITTEES OF INDEPENDENT TOTAL CASH
FOR SERVICE AS AS DIRECTOR OR INDEPENDENT DIRECTORS/ COMPENSATION PAID
TRUSTEE AND TRUSTEE AND TRUSTEES TRUSTEES FOR SERVICES TO
COMMITTEE COMMITTEE AND AUDIT AND AUDIT 82 DEAN WITTER
MEMBER MEMBER FOR SERVICE AS COMMITTEES COMMITTEES FUNDS, 14
OF 14 OF 82 DIRECTOR OF OF 14 OF 82 TCW/DW FUNDS
NAME OF INDEPENDENT TCW/DW DEAN WITTER TCW GALILEO TCW/DW DEAN WITTER AND TCW
TRUSTEE FUNDS FUNDS FUNDS, INC. FUNDS FUNDS GALILEO FUNDS, INC.
- -------------------------- -------------- -------------- -------------- --------------- -------------- -------------------
John C. Argue.............. $66,483 -- $39,000 -- -- $105,483
John R. Haire.............. 64,283 $106,400 -- $12,187 $195,450 378,320
Dr. Manuel H. Johnson ..... 66,483 137,100 -- -- -- 203,583
Michael E. Nugent.......... 64,283 138,850 -- -- -- 203,133
John L. Schroeder.......... 69,083 137,150 -- -- -- 206,233
As of the date of this Proxy Statement, 57 of the Dean Witter Funds have
adopted a retirement program under which an Independent Trustee who retires
after serving for at least five years (or such lesser period as may be
determined by the Board) as an Independent Director or Trustee of any Dean
Witter Fund that has adopted the retirement program (each such Fund referred
to as an "Adopting Fund" and each such Trustee referred to as an "Eligible
Trustee") is entitled to retirement payments upon reaching the eligible
retirement age (normally, after attaining age 72). Annual payments are based
upon length of service. Currently, upon retirement, each Eligible Trustee is
entitled to receive from the Adopting Fund, commencing as of his or her
retirement date and continuing for the remainder of his or her life, an
annual retirement benefit (the "Regular Benefit") equal to 25.0% of his or
her Eligible Compensation plus 0.4166666% of such Eligible Compensation for
each full month of service as an Independent Director or Trustee of any
Adopting Fund in excess of five years up to a maximum of 50.0% after ten
years of service. The foregoing percentages may be changed by the Board. (1)
"Eligible Compensation" is one-fifth of the total compensation earned by such
Eligible Trustee for service to the Adopting Fund in the five year period
prior to the date of the Eligible Trustee's retirement. Benefits under the
retirement program are not secured or funded by the Adopting Funds.
The following table illustrates the retirement benefits accrued to Messrs.
Haire, Johnson, Nugent and Schroeder by the 57 Dean Witter Funds for the year
ended December 31, 1996, and the estimated retirement benefits for Messrs.
Haire, Johnson, Nugent and Schroeder, to commence upon their retirement, from
the 57 Dean Witter Funds as of December 31, 1996.
- ------------
(1) An Eligible Trustee may elect alternate payments of his or her retirement
benefits based upon the combined life expectancy of such Eligible Trustee
and his or her spouse on the date of such Eligible Trustee's retirement.
The amount estimated to be payable under this method, through the
remainder of the later of the lives of such Eligible Trustee and spouse,
will be the actuarial equivalent of the Regular Benefit. In addition, the
Eligible Trustee may elect that the surviving spouse's periodic payment
of benefits will be equal to either 50% or 100% of the previous periodic
amount, an election that, respectively, increases or decreases the
previous periodic amount so that the resulting payments will be the
actuarial equivalent of the Regular Benefit.
9
RETIREMENT BENEFITS FROM ALL DEAN WITTER FUNDS
ESTIMATED
CREDITED YEARS ESTIMATED RETIREMENT BENEFITS ESTIMATED ANNUAL BENEFITS
OF SERVICE AT PERCENTAGE OF ACCRUED AS EXPENSES UPON RETIREMENT
RETIREMENT ELIGIBLE BY ALL ADOPTING FROM ALL ADOPTING
NAME OF INDEPENDENT TRUSTEE (MAXIMUM 10) COMPENSATION FUNDS FUNDS(2)
- --------------------------- -------------- --------------- ------------------- -------------------------
John R. Haire............... 10 50.0% $46,952 $129,550
Dr. Manuel H. Johnson....... 10 50.0 10,926 51,325
Michael E. Nugent........... 10 50.0 19,217 51,325
John L. Schroeder........... 8 41.7 38,700 42,771
(2) Based on current levels of compensation. Amount of annual benefits also
varies depending on the Trustee's elections described in Footnote (1)
above.
REQUIRED VOTE
The election of the nominees as Trustees requires the affirmative vote of
a majority of the shares represented in person or by proxy and entitled to
vote at a meeting at which a quorum is present. Under the Trust's By-laws,
the presence in person or by proxy of the holders of a majority of the shares
issued and outstanding and entitled to vote at the Meeting shall constitute a
quorum.
THE TRUSTEES UNANIMOUSLY RECOMMEND THAT THE SHAREHOLDERS VOTE "FOR" THE
ELECTION OF THE TWO NOMINEES AS TRUSTEES.
(2) APPROVAL OR DISAPPROVAL OF CURRENTLY EFFECTIVE
INVESTMENT ADVISORY AGREEMENT
The Trust's investments are managed by TCW Funds Management, Inc.
(referred to herein as the "Investment Adviser"), pursuant to an Investment
Advisory Agreement dated March 23, 1994, and amended as of June 27, 1996
(referred to herein as the "Advisory Agreement").
THE ADVISORY AGREEMENT
The Advisory Agreement was initially approved by the Board of Trustees of
the Trust, including all of the Independent Trustees, at a meeting held on
February 9, 1994, and was approved by InterCapital, the then sole shareholder
of the Trust, on March 22, 1994. The Advisory Agreement was last approved by
the Shareholders at their Annual Meeting held on June 27, 1996. In the event
shareholders do not approve continuance of the Advisory Agreement by the
required majority vote at the forthcoming meeting or an adjournment thereof,
the Board of Trustees of the Trust will take such action as it deems to be in
the best interest of the Trust and its Shareholders, which may include
calling a special meeting of shareholders to vote on a new investment
advisory agreement or continuance of the present Advisory Agreement until the
next Annual Meeting of Shareholders.
In considering whether or not to approve the Advisory Agreement, the Board
of Trustees reviewed the terms of the agreement and considered all materials
and information deemed relevant to its determination. Among other things, the
Board considered the nature and scope of services to be rendered, the quality
of the Adviser's services and personnel, and the appropriateness of the fees
that are paid under the Advisory Agreement. Based upon its review, the Board
of Trustees, including all of the Independent Trustees, determined that the
approval of the Advisory Agreement was in the best interests of the Trust and
its Shareholders.
10
THE ADVISORY AGREEMENT
The Advisory Agreement provides that the Investment Adviser shall
continously invest the assets of the Trust in a manner consistent with the
Trust's investment objectives. The Investment Adviser obtains and evaluates
such information and advice relating to the economy, securities markets and
specific securities as it considers necessary or useful to continuously
manage the assets of the Trust in a manner consistent with its investment
objectives and policies. In addition, the Investment Adviser pays the
compensation of all personnel, including officers of the Trust, who are its
employees. The Investment Adviser has authority to place orders for the
purchase and sale of portfolio securities on behalf of the Trust without
prior approval of its Trustees. The Trustees review the investment portfolio
at their regular meetings.
Under the Advisory Agreement, the Trust is obligated to bear all of the
costs and expenses of its operation, except those specifically assumed by the
Investment Adviser or the Manager, including, without limitation: charges and
expenses of any registrar, custodian or depository appointed by the Trust for
the safekeeping of its cash, portfolio securities or commodities and other
property, and any stock transfer or dividend agent or agents appointed by the
Trust; brokers' commissions chargeable to the Trust in connection with
portfolio securities transactions to which the Trust is a party; all taxes,
including securities or commodities issuance and transfer taxes, and fees
payable by the Trust to Federal, state or other governmental agencies; costs
and expenses of engraving or printing of certificates representing shares of
the Trust; all costs and expenses in connection with registration and
maintenance of registration of the Trust and of its shares with the
Securities and Exchange Commission and various states and other jurisdictions
(including filing fees and legal fees and disbursements of counsel); the
costs and expense of preparation, printing, including typesetting, and
distributing prospectuses for such purposes; all expenses of shareholders'
and Trustees' meetings and of preparing, printing and mailing proxy
statements and reports to shareholders; fees and travel expenses of Trustees
or members of any advisory board or committee who are not employees of the
Trust's Manager or Investment Adviser or any of their corporate affiliates;
all expenses incident to the payment of any dividend or distribution program;
charges and expenses of any outside pricing services; charges and expenses of
legal counsel, including counsel to the Independent Trustees of the Trust,
and independent accountants in connection with any matter relating to the
Trust (not including compensation or expenses of attorneys employed by the
Trust's Manager or Investment Adviser); membership dues of industry
associations; interest payable on Trust borrowings; fees and expenses
incident to the listing of the Trust's shares on any stock exchange; postage;
insurance premiums on property or personnel (including officers and Trustees)
of the Trust which inure to its benefit; extraordinary expenses (including,
but not limited to, legal claims, liabilities, litigation costs and any
indemnification related thereto); and all other charges and costs of the
Trust's operations unless otherwise explicitly provided in the Advisory
Agreement.
The Advisory Agreement had an initial term ending April 30, 1995 and
provides that, after the initial period of effectiveness, it will continue in
effect from year to year thereafter provided such continuance is approved at
least annually by vote of a majority, as defined in the Act, of the
outstanding voting securities of the Trust or by the Trustees of the Trust,
and, in either event, by the vote cast in person by a majority of the
Trustees who are not parties to the Advisory Agreement or "interested
persons" of any such party (as defined in the Act) at a meeting called for
the purpose of voting on such approval. The Advisory Agreement's most recent
continuation until April 30, 1998, was approved by the Trustees, including a
majority of Independent Trustees, at a Meeting of the Trustees held on April
24, 1997, called for the purpose of approving the Management Agreement.
The Advisory Agreement also provides that it may be terminated at any time
by the Investment Adviser, the Trustees of the Trust or by a vote of a
majority of the outstanding voting securities of the Trust, in each instance
without the payment of any penalty, on thirty days notice and will
automatically terminate upon any assignment (as defined in the Act).
11
In return for its investment services and the expenses which the
Investment Adviser assumes under the Advisory Agreement, the Trust pays the
Investment Adviser compensation which is computed weekly and payable monthly
and which is determined by applying the annual rate of 0.50% to the Trust's
average weekly net assets. Pursuant to the Advisory Agreement, the Trust
accrued to the Investment Adviser total compensation of $1,394,498 during the
fiscal year ended January 31, 1997. The net assets of the Trust totalled
$305,307,534 at January 31, 1997.
INVESTMENT ADVISER
TCW Funds Management, Inc. (the "Investment Adviser") is the Trust's
investment adviser. The Investment Adviser, a California corporation, is a
wholly-owned subsidiary of The TCW Group, Inc., a Nevada corporation, whose
direct and indirect subsidiaries, including Trust Company of the West and TCW
Asset Management Company, provide a variety of trust, investment management
and investment advisory services. As of March 31, 1997, the Investment
Adviser and its affiliates had over $52 billion under management or committed
to management. The Investment Adviser is headquartered at 865 South Figueroa
Street, Suite 1800, Los Angeles, California 90017.
The Principal Executive Officers and Directors of the Investment Adviser,
and their principal occupations, are:
Thomas E. Larkin, Jr., Chairman, Marc I. Stern, President and Alvin R.
Albe, Jr., Executive Vice President of the Investment Adviser. Mr. Robert A.
Day may be deemed to be a control person of the Adviser by virtue of the
aggregate ownership by Mr. Day and his family of more than 25% of the
outstanding voting stock of The TCW Group. The principal occupations of
Messrs. Larkin and Stern are described in the preceding tables. Mr. Albe is
an Executive Vice President of The TCW Group, Inc.
The business address of the foregoing Directors and Executive Officers is
865 South Figueroa Street, Suite 1800, Los Angeles, California 90017.
The Appendix lists the investment companies for which the Investment
Adviser provides investment advisory or sub-advisory services and which have
similar investment objectives to that of the Trust, and sets forth the fees
payable to the Investment Adviser by such investment companies, including the
Trust, and their net assets as of March 31, 1997.
MANAGER
Dean Witter Services Company Inc. ("DWSC" or the "Manager"), a Delaware
corporation, is the Trust's Manager. DWSC, which maintains its offices at Two
World Trade Center, New York, New York 10048, is a wholly-owned subsidiary of
Dean Witter InterCapital Inc. ("InterCapital"), a Delaware corporation.
InterCapital maintains its offices at Two World Trade Center, New York, New
York 10048. InterCapital, which was incorporated in July, 1992, is a
wholly-owned subsidiary of Dean Witter, Discover & Co. ("DWDC"), a balanced
financial services organization providing a broad range of nationally
marketed credit and investment products. In an internal reorganization which
took place in January, 1993, InterCapital assumed the investment advisory,
management and administrative activities previously performed by the
InterCapital Division of Dean Witter Reynolds Inc. ("DWR").
On February 5, 1997, DWDC and Morgan Stanley Group Inc. announced that
they had entered into an Agreement and Plan of Merger, with the combined
company to be named Morgan Stanley, Dean Witter, Discover & Co. The business
of Morgan Stanley Group Inc. and its affiliated companies is providing a wide
range of financial services for sovereign governments, corporations,
institutions and individuals throughout the
12
world. DWDC is the direct parent of InterCapital and Distributors. It is
currently anticipated that the transaction will close in mid-1997.
Thereafter, InterCapital and Distributors will be direct subsidiaries of
Morgan Stanley, Dean Witter, Discover & Co.
As the Trust's Manager, DWSC receives from the Trust compensation which is
computed weekly and payable monthly and which is determined by applying the
annual rate of 0.75% to the Trust's weekly net assets. For the fiscal year
ended January 31, 1997, the Trust accrued to DWSC, pursuant to a Management
Agreement, total compensation of $2,091,746.
The Principal Executive Officer and Directors of InterCapital, and their
principal occupations, are:
Philip J. Purcell, Chairman of the Board of Directors and Chief Executive
Officer of DWDC and DWR and Director of InterCapital, DWSC and Distributors;
Richard M. DeMartini, President and Chief Operating Officer of Dean Witter
Capital, Executive Vice President of DWDC and Director of DWR, Distributors,
InterCapital, DWSC and DWTC; James F. Higgins, President and Chief Operating
Officer of Dean Witter Financial, Executive Vice President of DWDC and
Director of DWR, Distributors, InterCapital, DWSC and DWTC; Charles A.
Fiumefreddo, Executive Vice President and Director of DWR, Chairman of the
Board of Directors, Chief Executive Officer and Director of InterCapital,
DWSC and Distributors and Chairman of the Board of Directors and Director of
DWTC; Christine A. Edwards, Executive Vice President, Secretary and General
Counsel of DWDC, Executive Vice President, Secretary, General Counsel and
Director of DWR, Executive Vice President, Secretary, Chief Legal Officer and
Director of Distributors and Director of InterCapital and DWSC; and Thomas C.
Schneider, Executive Vice President and Chief Financial Officer of DWDC and
Executive Vice President, Chief Financial Officer and Director of DWR,
Distributors, InterCapital and DWSC.
The business address of the foregoing Directors and Executive Officers is
Two World Trade Center, New York, New York 10048.
InterCapital and DWSC serve in various investment management, advisory,
management and administrative capacities to investment companies and pension
plans and other institutional and individual investors.
DWDC has its offices at Two World Trade Center, New York, New York 10048.
There are various lawsuits pending against DWDC involving material amounts
which, in the opinion of its management, will be resolved with no material
effect on the consolidated financial position of the company.
During the fiscal year ended January 31, 1997, the Trust accrued to Dean
Witter Trust Company, the Trust's Transfer Agent and an affiliate of the
Manager, transfer agency fees of $284,526.
SUB-ADVISERS
TCW Asia Limited ("TCW Asia") and TCW/DW London International, Limited
("TCW London") are the Trust's sub-advisers. TCW Asia and TCW London are both
wholly-owned subsidiaries of The TCW Group, Inc.
AFFILIATED BROKER
Because DWR and InterCapital are under the common control of DWDC, DWR is
an affiliated broker of InterCapital. During the fiscal year ended January
31, 1997, the Trust did not pay any brokerage commissions to DWR.
REQUIRED VOTE
The favorable vote of a majority of the outstanding voting securities of
the Trust is required for the approval of the Advisory Agreement. Such a
majority is defined in the 1940 Act as the lesser of (a) 67% or more
13
of the shares present at the Meeting, if the holders of more than 50% of the
outstanding shares of the Trust are present or represented by proxy, or (b)
more than 50% of the outstanding shares.
THE TRUSTEES UNANIMOUSLY RECOMMEND THAT THE SHAREHOLDERS VOTE "FOR" THE
CONTINUANCE OF THE ADVISORY AGREEMENT.
(3) RATIFICATION OR REJECTION OF SELECTION OF INDEPENDENT ACCOUNTANTS
The Trustees have unanimously selected the firm of Price Waterhouse LLP as
the Trust's independent accountants for the fiscal year ending January 31,
1998. Price Waterhouse LLP has been the independent accountants for the Trust
since its inception, and has no direct or indirect financial interest in the
Trust.
A representative of Price Waterhouse LLP is expected to be present at the
Annual Meeting of Shareholders and will be available to make a statement, if
he or she so desires, and to respond to appropriate questions of
shareholders.
REQUIRED VOTE
The affirmative vote of the holders of a majority of the shares
represented and entitled to vote at the Annual Meeting is required for
ratification of the selection of Price Waterhouse LLP as the independent
accountants for the Trust.
THE TRUSTEES UNANIMOUSLY RECOMMEND THAT THE SHAREHOLDERS VOTE "FOR" THE
RATIFICATION OF THE SELECTION OF PRICE WATERHOUSE LLP AS THE INDEPENDENT
ACCOUNTANTS FOR THE TRUST.
(4) SHAREHOLDER PROPOSAL RECOMMENDING THAT THE BOARD OF TRUSTEES TAKE ACTION
TO CONVERT THE FUND FROM CLOSED-END TO OPEN-END STATUS.
SHAREHOLDER PROPOSAL
The Board of Trustees has been informed by Newgate Management Associates,
located at 80 Field Point Road, Greenwich, CT 06830, which beneficially owns
133,575 shares of Common Stock, that it intends to submit the following
proposal at the Meeting:
RESOLVED, that the holders of the common stock of TCW/DW Emerging Markets
Opportunities Trust (the "Trust"), assembled at an annual meeting in person
and by proxy, hereby recommend that the Trust's Board of Trustees take all
necessary legal and other actions to convert the Trust from closed-end status
to open-end status.
The proponent has requested that the following statement be included in
the proxy statement in support of its proposal.
The prospectus, dated March 23, 1994, pursuant to which the Trust
offered its common stock to the public states, that: "In recognition of
the possibility that the Trust's shares might . . . trade at a discount,
the Trustees have determined that it would be in the interest of
shareholders for the Trust to take action to attempt to reduce or
eliminate a market value discount from net asset value." The prospectus
also states that "The Trust's Declaration of Trust contains a provision
which allows for the conversion of the Trust from a closed-end to an
open-end investment company."
DESPITE THE FACT THAT THE TRUST HAS TRADED AT AN AVERAGE DISCOUNT OF
17.01% FOR THE PAST 52 WEEKS AND AN AVERAGE DISCOUNT OF 14.3% SINCE THE
TRUST'S INCEPTION THROUGH DECEMBER 6, 1996, THE BOARD OF TRUSTEES HAS NOT,
OCCASIONAL REPURCHASES NOT WITHSTANDING, ATTEMPTED TO REDUCE THIS DISCOUNT
EITHER THROUGH TENDER OFFERS OR THE CONVERSION OF THE TRUST TO OPEN-END
STATUS.
14
"EMO DISCOUNT" PERCENTAGE PREMIUM/DISCOUNT COMPARISON SINCE APRIL 29, 1994
[THE NARRATIVE AND/OR TABULAR INFORMATION BELOW IS A FAIR AND
ACCURATE DESCRIPTION OF GRAPHIC OR IMAGE MATERIAL OMITTED FOR
THE PURPOSE OF EDGAR FILING.]
Date Price NAV (%) Premium/Discount
---- ------ ---- ---------------------
4/29/94 15.125 14.00 8.036
5/ 6/94 15.250 13.97 9.162
5/13/94 15.250 13.95 9.319
5/20/94 15.125 14.17 6.740
5/27/94 15.000 14.20 5.634
6/ 3/94 15.125 14.10 7.270
6/10/94 15.000 14.06 6.686
6/17/94 15.125 14.01 7.959
6/24/94 14.500 13.71 5.762
7/ 1/94 14.250 13.70 4.015
7/ 8/94 14.000 13.84 1.156
7/15/94 14.000 14.01 -0.071
7/22/94 13.500 14.00 -3.571
7/29/94 13.250 14.28 -7.213
8/ 5/94 13.875 14.50 -4.310
8/12/94 13.500 14.87 -9.213
8/19/94 14.125 15.41 -8.339
8/26/94 14.250 15.37 -7.287
9/ 2/94 14.000 15.55 -9.968
9/ 9/94 14.000 15.69 -10.771
9/16/94 13.875 15.77 -12.016
9/23/94 13.750 15.90 -13.522
9/30/94 13.750 15.65 -12.141
10/ 7/94 13.250 15.36 -13.737
10/14/94 13.625 15.75 -13.492
10/21/94 13.375 15.53 -13.876
10/28/94 13.000 15.43 -15.749
11/ 4/94 12.625 15.33 -17.645
11/11/94 13.125 15.18 -13.538
11/18/94 12.625 14.75 -14.407
11/25/94 12.625 14.32 -11.837
12/ 2/94 12.000 14.34 -16.318
12/ 9/94 11.500 13.96 -17.622
12/16/94 11.375 13.95 -18.459
12/23/94 10.625 13.00 -18.269
12/30/94 10.625 12.84 -17.251
1/ 6/95 10.250 12.16 -15.707
1/13/95 10.125 11.77 -13.976
1/20/95 9.375 11.33 -17.255
1/27/95 10.125 11.06 -8.454
2/ 3/95 9.500 11.54 -17.678
2/10/95 9.500 11.45 -17.031
2/17/95 9.250 11.90 -22.269
2/24/95 8.750 10.95 -20.091
3/ 3/95 8.625 10.50 -17.857
3/10/95 8.750 10.27 -14.800
3/17/95 8.625 10.62 -18.785
3/24/95 9.125 10.79 -15.431
3/31/95 9.250 10.96 -15.602
4/ 7/95 9.500 11.26 -15.631
4/14/95 9.000 11.06 -18.626
4/21/95 9.500 11.38 -16.520
4/28/95 9.875 11.41 -13.453
5/ 5/95 9.625 11.73 -17.945
5/12/95 10.375 12.25 -15.306
5/19/95 10.375 12.17 -14.749
5/26/95 10.125 12.21 -17.076
6/ 2/95 10.125 12.40 -18.347
6/ 9/95 10.000 12.12 -17.492
6/16/95 10.000 12.19 -17.966
6/23/95 9.875 12.07 -18.186
6/30/95 10.125 12.05 -15.975
7/ 7/95 10.625 12.58 -15.541
7/14/95 10.625 12.70 -16.339
7/21/95 10.250 12.52 -18.131
7/28/95 10.250 12.52 -18.131
8/ 4/95 10.125 12.68 -20.150
8/11/95 9.875 12.53 -21.189
8/18/95 10.125 12.29 -17.616
8/25/95 10.000 12.28 -18.567
9/ 1/95 9.750 12.28 -20.603
9/ 8/95 9.875 12.22 -19.190
9/15/95 10.000 12.41 -19.420
9/22/95 10.000 12.23 -18.234
9/29/95 9.875 12.04 -17.982
10/ 6/95 9.500 11.97 -20.635
10/13/95 9.375 11.80 -20.551
10/20/95 9.375 11.92 -21.351
10/27/95 9.125 11.47 -20.445
11/ 3/95 9.500 11.36 -16.373
11/10/95 9.625 11.02 -12.659
11/17/95 9.125 11.00 -17.045
11/24/95 9.250 11.28 -17.996
12/ 1/95 9.500 11.63 -18.315
12/ 8/95 9.875 11.76 -16.029
12/15/95 10.125 11.71 -13.535
12/22/95 10.250 12.02 -14.725
12/29/95 10.125 11.97 -15.414
1/ 5/96 11.500 12.63 -8.947
1/12/96 11.500 12.70 -9.449
1/19/96 11.875 12.86 -7.659
1/26/96 12.375 12.89 -3.995
2/ 2/96 12.250 13.00 -5.769
2/ 9/96 11.875 13.11 -9.420
2/16/96 12.000 13.03 -7.905
2/23/96 11.625 13.02 -10.714
3/ 1/96 11.250 12.78 -11.972
3/ 8/96 10.125 12.49 -18.935
3/15/96 10.625 12.47 -14.796
3/22/96 10.750 12.81 -16.081
3/29/96 10.875 12.79 -14.973
4/ 5/96 10.750 12.94 -16.924
4/12/96 10.750 12.99 -17.244
4/19/96 10.750 13.38 -19.656
4/26/96 10.875 13.45 -19.145
5/ 3/96 10.625 13.44 -20.945
5/10/96 11.000 13.53 -18.699
5/17/96 11.125 13.63 -18.379
5/24/96 11.000 13.64 -19.355
5/31/96 10.875 13.69 -20.562
6/ 7/96 10.750 13.47 -20.193
6/14/96 10.750 13.38 -19.656
6/21/96 10.875 13.44 -19.085
6/28/96 11.000 13.53 -18.699
7/ 5/96 10.875 13.64 -20.271
7/12/96 10.750 13.49 -20.311
7/19/96 10.500 13.40 -21.642
7/26/96 10.125 12.78 -20.775
8/ 2/96 10.500 13.07 -19.663
8/ 9/96 10.500 13.08 -19.725
8/16/96 10.500 13.11 -19.908
8/23/96 10.750 13.19 -18.499
8/30/96 10.500 13.15 -20.152
9/ 6/96 10.750 13.17 -18.375
9/13/96 10.750 13.19 -18.499
9/20/96 10.625 13.24 -19.751
9/27/96 10.625 13.13 -19.078
10/ 4/96 10.875 13.36 -18.600
10/11/96 10.625 13.28 -19.992
10/18/96 10.750 13.39 -19.716
10/25/96 10.625 13.10 -18.893
11/ 1/96 10.375 13.03 -20.376
11/ 8/96 10.625 13.16 -19.263
11/15/96 10.750 13.27 -18.990
11/22/96 10.625 13.37 -20.531
11/29/96 10.875 13.35 -18.539
12/ 6/96 10.625 13.30 -20.113
There are several precedents for open-end conversions. In 1995, the
Boards of Global Privatization Fund and Global Total Return Fund proposed
open-ending votes to their stockholders. In each case, the result was an
immediate gain in the respective funds' share prices, to the obvious
benefit of their stockholders.
Conversion of the Trust to an open-end fund would:
o If effective today, permit stockholders desiring to dispose of their
investments to do so at a price substantially higher than the trading
price of the Trust's Shares on the New York Stock Exchange.
o Immediately increase the market value of the Trust's Shares.
o Allow stockholders to increase their investments in the Trust without
incurring any brokerage commissions, although stockholders might be
subject to sales charges.
o Eliminate any future possibility of the Trust's Shares trading at a
discount to net asset value.
An open-end fund sells its Shares to the public on a continuing basis
and permits its stockholders to redeem Shares on a continuing basis at
their net asset value at the time of redemption (less any redemption
charges). If this proposal were approved, Trust stockholders would be able
to dispose of their Shares at a price equal to the net asset value.
ADOPTION OF THIS PROPOSAL WOULD INCREASE THE VALUE OF STOCKHOLDERS'
SHARES, IMMEDIATELY AND SIGNIFICANTLY.
FOR ALL OF THE FOREGOING REASONS, THE PROPONENT STRONGLY RECOMMENDS THAT
SHAREHOLDERS VOTE FOR THIS PROPOSAL.
15
END OF PROPONENT'S STATEMENT
CONSIDERATIONS OF THE BOARD OF TRUSTEES
When the Trust was organized in 1993, a closed-end format was chosen as
most appropriate to the Trust's character and intended method of operation
because it was believed that such a structure, among other things, would
permit management of the Trust's portfolio consistent with its investment
objective and policies without the pressures and constraints to which
open-end investment companies are subject as a result of cash inflows and
redemptions.
The Trust's prospectus used in connection with the offering of shares in
1994 stated that shares of closed-end investment companies frequently trade
at a discount from net asset value. Accordingly, the Trustees contemplated
that the Trust might from time to time consider action either to eliminate or
reduce the discount by repurchasing shares of the Trust in the open market or
tendering for its own shares at net asset value. The prospectus also stated
that the Board intended, on an annual basis, to consider the making of a
tender offer but that at no time would the Trustees be required to make such
repurchases or tenders.
Since approximately July 1994, the Trust's shares have consistently traded
at a discount from net asset value. The Investment Adviser believed that a
share repurchase program, as opposed to isolated tender offers, offered the
best chance of reducing the discount while still retaining the advantages of
a closed end structure. Accordingly, the Board instituted a share repurchase
program in order to attempt to reduce the discount. The Trust repurchased
approximately 2.7 million shares at a cost of almost $29 million and at
discounts ranging up to approximately 22% over a period of almost three
years. The failure of the repurchase program substantially to reduce the
discount has caused the Board and the Investment Adviser to give further
consideration to the various alternatives whereby the discount might be
reduced or eliminated and to re-examine the appropriateness of continuing to
operate the Trust as a closed-end investment company.
At a meeting held on January 23, 1997, the Board of Trustees, including
the Independent Trustees, considered the foregoing shareholder proposal
recommending that the Board take action to convert the Trust into an open-end
investment company. After consideration of the advantages and disadvantages
of conversion to an open-end fund, the Board, including all of the
Independent Trustees, determined that because there were significant
arguments for and against conversion it would be appropriate to submit the
matter to shareholders without a specific recommendation.
In making its determination, the Board noted that conversion to open-end
status would have the immediate beneficial effect of eliminating the market
discount at which the Trust's shares trade, as shares would be redeemable at
net asset value. The Board also considered the view of the Investment Adviser
that the Trust's portfolio securities are sufficiently liquid and that the
Trust should have no difficulty in satisfying redemption requests even if the
level of redemptions upon conversion is initially high, or in otherwise
managing the Trust as an open-end fund. Accordingly, open-ending the Trust
would eliminate the discount while at the same time permitting the Trust to
continue its operations with its objective and policies substantially intact.
The Board also considered the potential advantages of the closed-end
structure relative to the open-end structure. Under an open-end structure, as
discussed below, the Trust would be limited to investing no more than 15% of
its net assets in illiquid securities. As prominently disclosed on the cover
of the Trust's initial prospectus, "emerging market country securities
markets are generally characterized by a relatively small number of equity
issues and low trading volumes, resulting in comparatively greater price
volatility and lesser liquidity of portfolio investments." In this regard,
the Investment Adviser informed the Board that it currently manages an
open-end fund with an objective identical to that of the Trust and has not
found the 15% limitation unduly burdensome. Nevertheless, the limitations
could potentially restrict its ability in the future to take advantage of
particular investment opportunities.
16
Second, a closed-end fund does not continuously redeem its shares, while
an open-end structure would require the Trust to redeem its shares on a
continuous basis. As emerging markets are often volatile and subject to
changes in investor sentiment, permitting continuous redemptions of shares
under an open-end structure may force the Trust to sell securities at
depressed prices when the markets are in a downturn in order to meet these
redemptions. Conversely, the Trust would be purchasing securities at higher
prices when capital flows into the Trust during periods of market increases.
The closed-end structure, by contrast, because it does not redeem securities
on a continuous basis, permits the Investment Adviser to allocate investments
among emerging markets as it deems suitable to the Trust's long-term
investment objective without the concern of having to meet redemptions.
Furthermore, the need to meet redemptions under an open-end structure may
limit the ability of the Trust's Investment Adviser to take advantage of
short-term market disruptions that may offer potential long-term investment
opportunities. The closed-end structure would allow the Trust to take
advantage of such short-term market disruptions.
Third, if converted to an open-end Trust, the Investment Adviser could be
required to maintain higher cash reserves and the Trust's portfolio could not
be as fully invested in equity securities of emerging countries as it would
otherwise be under a closed-end structure. As a result, a smaller portion of
the Trust's portfolio would be generating the potential gains and increases
which would be used to pay distributions and dividends to stockholders as
consistent with the Trust's long-term investment strategy.
Fourth, conversion to open-end status would result in increased expenses
to the shareholders as the Trust would have additional expenses in connection
with the distribution of shares and other shareholder services associated
with an open-end structure. As set forth below, the estimated total operating
expenses for the Trust under an open-end structure, exclusive of any sales
charges, would be approximately 2.07%, which represents an increase of 0.30%
per share from the current closed-end structure. The projected total expenses
are based on a 12b-1 fee of 0.25%, and the same management fee of 0.75%. As
discussed below, the Trustees believe that an open-end fund would not be
viable absent a 12b-1 plan and, accordingly, would not implement a conversion
to open-end status unless, among other things, a 12b-1 plan for the Trust
(Proposal No. 10) is approved by the shareholders. In addition, the potential
capital outflow that may occur upon conversion would reduce the Trust's
economies of scale and result in even higher relative per share expenses.
While it is true that under the current closed-end structure shareholders
disposing of shares or purchasing additional shares pay brokerage fees, under
an open-end structure such expenses would be borne by all shareholders,
including those with long-term investment horizons. In addition, the
conversion itself would create significant one time expenses associated with
the conversion. Such expenses would include registration, legal, accounting,
printing and other expenses associated with establishing an open-end fund
which would be borne by the shareholders. It is estimated at this time that
these expenses would total approximately $175,000.
DIFFERENCES BETWEEN TRUST OPERATIONS AS AN OPEN-END AND CLOSED-END INVESTMENT
COMPANY
The Trust is currently registered as a "closed-end" investment company
under the 1940 Act. Closed-end investment companies neither redeem their
outstanding shares nor generally engage in the continuous sale of new
securities, and thus operate with a relatively fixed capitalization. The
shares of closed-end investment companies are normally bought and sold on
national securities exchanges. The Trust's shares are currently traded on the
New York Stock Exchange (the "NYSE"). The Trust's shares would be delisted
from the NYSE upon effectiveness of the registration statement converting the
Trust to an open-end investment company.
In contrast, open-end investment companies, commonly referred to as
"mutual funds," issue redeemable securities. The holders of redeemable
securities have the right to surrender those securities to the mutual fund
and obtain in return their proportionate share of the value of the fund's net
assets (less any redemption fee charged by the fund). Many mutual funds
(including the Trust, if the proposed conversion is effected) also
continuously issue new shares to investors through the fund's distributor at
the public offering price at the time of such issuance.
17
Some of the legal and practical differences between operations of the
Trust as a closed-end and an open-end investment company are as follows:
(a) Acquisition and Disposition of Shares. If the Trust is converted into
an open-end investment company, the Trust's shares will no longer be listed
on the NYSE and investors wishing to acquire shares of the Trust would be
able to purchase them from the Distributor at the public offering price.
Shareholders desiring to realize the value of their shares would be able to
do so by exercising their right to have such shares redeemed by the Trust at
the next determined current net asset value. The Trust's net asset value per
share is calculated by dividing (i) the value of its portfolio securities
plus all cash and other assets (including accrued interest and dividends
received but not collected) less all liabilities (including accrued expenses)
by (ii) the number of outstanding shares of the Trust. The Securities and
Exchange Commission (the "SEC") generally requires open-end investment
companies to value their assets on each business day in order to determine
the current net asset value on the basis of which their shares may be
redeemed by shareholders or purchased by investors. Net asset values of most
open-end investment companies are published daily by leading financial
publications.
(b) Elimination of Discount. Converting the Trust into an open-end fund
will eliminate immediately any market discount from net asset value. It will
also eliminate any possibility that the Trust's shares will trade at a
premium over net asset value. If the Conversion is approved by the
shareholders the market discount may be reduced prior to the date of any
conversion to open-end status to the extent investors are induced to purchase
shares in the open market in anticipation of a prospective open-ending.
(c) Illiquid Securities. An open-end investment company is restricted from
investing more than 15% of its net assets in illiquid securities, including
repurchase agreements which have a maturity of longer than seven days,
securities with legal and contractual restrictions on resale (restricted
securities) and securities that are not readily marketable. Restricted
securities eligible for resale pursuant to Rule 144A under the Securities Act
of 1933, as amended, and privately placed commercial paper that have a
readily available market will not be considered illiquid for purposes of this
limitation.
(d) Expenses; Potential Net Redemptions. Open-end funds are generally more
expensive to operate and administer than closed-end funds. The Trust's
expense ratio subsequent to the Conversion is nevertheless expected by the
Investment Adviser to be only slightly higher than its current expense ratio.
Expenses of operation as an open-end fund not currently borne by the Trust
include the costs associated with the distribution of the Trust's shares (see
Proposal No. 10 regarding approval of a Plan of Distribution pursuant to Rule
12b-1) and the cost of filing notices in the various states (see "State
Securities Law Implications" below). However, as an open-end fund, the Fund
would not be required to pay the annual NYSE listing expenses of
approximately $31,000. In addition, the Trust might be required to sell
portfolio securities in order to meet redemptions, thereby resulting in
realization of gains (or losses). As of January 31, 1997, the Trust had
$55,896,837 of net unrealized appreciation for federal income tax purposes.
For federal income tax purposes, the Trust had a net capital loss
carryforward of approximately $48,382,000 as of January 31, 1997.
The Trust's expense ratio could be adversely affected by significant net
redemptions. In the unlikely event the Trust's asset base is reduced to such
a small size as to render the Trust no longer economically viable, the Board
might consider alternatives to continuing the Trust's operations, including
merging the Trust with another investment company or liquidating the Trust.
(e) State Securities Law Implications. As a closed-end fund listed on the
NYSE, the Trust does not currently bear the expense of notice filings with
state securities commissions. However, as a result of open-ending and making
a continuous offering of its shares, the Trust will be required to file
notices with state securities commissions and will incur the costs related to
such filings.
18
(f) Comparative Expense Information. Set forth below is a comparison of
the Trust's shareholder transaction expenses and annual operating expenses as
of January 31, 1997 as a closed-end fund and those expenses that would apply
to current shareholders on a pro forma (estimated) basis as an open-end fund.
SHAREHOLDER TRANSACTION EXPENSES CLOSED-END OPEN-END
- ----------------------------------------------------------------------- -------------- ------------
Maximum Sales Load Imposed on Purchases (as a percentage of offering
price) ................................................................ * 5.0%**
Maximum Sales Load Imposed on Reinvested Dividends ..................... * None
Deferred Sales Load (as a percentage of original purchase price or
redemption proceeds, whichever is lower) .............................. None None
Redemption Fees ........................................................ * None
Exchange Fee ........................................................... N/A None
ANNUAL TRUST OPERATING EXPENSES (as a percentage of average net assets)
- -------------------------------
Management and Advisory Fees ........................................... 1.25% 1.25%
12b-1 Fees ............................................................. None 0.25****
Other Expenses.......................................................... 0.47 0.52***
Total Trust Operating Expenses ......................................... 1.72 2.02***
- ------------
* Maximum sales load imposed on purchases made during the initial offering
period was approximately 5%. Purchases and sales made thereafter on the
NYSE are subject to customary brokerage commissions of approximately 1%,
but may be less or more than 1% depending on the size of the
transaction. With respect to shares issued in connection with the
Trust's dividend reinvestment plan, to the extent the plan agent is
required to purchase shares on the NYSE, shareholders may also incur
brokerage commissions.
** No sales load will be imposed in connection with the conversion of the
Trust from a closed-end to an open-end investment company. However, to
the extent current shareholders make additional purchases after the
conversion, it is currently expected that such purchases will be subject
to a front-end sales charge of approximately 5.0%. (See Proposals No.
5-10.)
*** Estimated based on expenses expected to have been incurred if the Trust
operated as an open-end fund during the entire fiscal year ended January
31, 1997.
**** This assumes shareholder approval of Proposal No. 10.
Set forth below are examples which show the expenses that an investor in
the Trust would pay on a $1,000 investment if the Trust remained closed-end
compared to those expenses which an investor would incur on a similar
investment if Proposal No. 4 is approved based upon the expense ratios set
forth above but without regard to any applicable sales charges or redemption
fees.
EXAMPLES 1 YEAR 3 YEARS 5 YEARS 10 YEARS
- ----------------------------------------------------------- -------- --------- --------- ----------
You would pay the following expenses on a $1,000
investment, assuming 5% annual return:
Closed-End: $17 $54 $ 93 $203
Open-End: $20 $63 $109 $235
The examples should not be considered a representation of past or future
expenses. Actual expenses may be greater or less than those shown.
(g) Voting Rights. The voting rights of holders of shares of the Trust
will not change if the Trust converts to open-end status, except that the
Board will have the authority to amend the Trust's Declaration of Trust or
By-Laws to authorize the issuance of additional shares of the Trust without
submitting such amendment to another shareholder vote.
By virtue of the provisions of Massachusetts law, opportunities to vote
may become less frequent if the Trust converts to open-end status, because
the Trust will not hold shareholder meetings unless required to do
19
so by the 1940 Act. Massachusetts law provides that, if the Declaration of
Trust or By-Laws so provides, then the fund is not required to hold an annual
shareholder meeting in any year in which the election of Trustees is not
required to be acted upon under the 1940 Act. The current By-Laws of the
Trust provide for an annual meeting of shareholders to be held. However, the
Trustees have adopted amended and restated By-Laws to go into effect if
Proposal No. 5 is approved, which provide that the Trust will not be required
to hold an annual meeting in any year in which it is not required to do so
under the 1940 Act. The Trust does not intend to hold annual meetings in any
year in which it is not so required.
By not having to hold annual shareholder meetings, the Trust would save
the costs of preparing proxy materials and soliciting shareholders' votes on
the usual proposals contained therein. Based on the number of outstanding
shares and shareholders as of the record date, such costs would aggregate
approximately $25,000 per year. Under the 1940 Act, the Trust would be
required to hold a shareholder meeting if the number of Trustees elected by
the shareholders were less than a majority of the total number of Trustees,
or if a change were sought in the fundamental investment policies of the
Trust or in the Trust's status (such as, for example, a change from open-end
to closed-end status).
(h) Dividend Reinvestment Plan. The Trust intends to continue to provide
the opportunity for shareholders to elect to receive dividends and capital
gains distributions in cash or, at no charge to shareholders, in shares of
the Trust. Whatever option a shareholder elected will remain the same after
the Conversion. Effective upon conversion to an open-end investment company,
such reinvestments in shares would be made at net asset value, rather than at
the market value of the shares on the NYSE as presently provided by the
Trust's current dividend reinvestment plan.
(i) Senior Securities and Borrowings. The 1940 Act prohibits mutual funds
from issuing "senior securities" representing indebtedness (i.e., bonds,
debentures, notes and other similar securities), other than indebtedness to
banks where there is an asset coverage of at least 300% for all borrowings.
Closed-end investment companies are permitted to issue "senior securities"
representing indebtedness to any lender if the 300% asset coverage is met and
may issue preferred stock (subject to various limitations), whereas open-end
investment companies generally may not issue preferred stock. This ability to
issue senior securities may give closed-end investment companies more
flexibility in "leveraging" a fund's portfolio. The Trust, however, may only
borrow money from a bank in an amount up to 25% of its total assets. In
addition, the Trust is not permitted to issue any senior securities. These
policies will be unchanged after the Conversion is effected. Accordingly, the
Manager does not believe that the greater limitations on mutual funds in this
respect will have a significant effect on the Trust's operations.
(j) Shareholder Services. If Proposal No. 4 is approved and the Trust is
converted into an open-end investment company, the same services will be made
available to shareholders of the Trust as are available to shareholders of
each of the open-end TCW/DW Funds (as defined below). Such services include:
(1) an automatic purchase plan, (2) a systematic withdrawal plan, (3) an
Exchange Privilege which allows shareholders of the Trust to exchange their
shares for shares of certain other TCW/DW Funds (as defined below) and (4)
the ability to effect various transactions by telephone.
(k) Distribution Plans. An open-end investment company, unlike a
closed-end investment company, is permitted to finance the distribution of
its shares by adopting a plan of distribution pursuant to Rule 12b-1 under
the 1940 Act. If the Trust is converted to a mutual fund and if Proposal No.
10 is approved by shareholders, the Trust will adopt a Plan of Distribution
pursuant to Rule 12b-1 in order to compensate the Distributor for services
provided and activities undertaken to distribute the shares of the Trust. See
Proposal No. 10 below.
(l) Minimum Investment and Involuntary Redemptions. If the Trust is
converted to an open-end fund, it will adopt requirements that an initial
investment in Trust shares and any subsequent investment must be in a
20
specified minimum amount, in order to reduce the administrative burdens
incurred in monitoring numerous small accounts. The Trust expects that the
minimum initial purchase will be $1,000 ($100 if the account is opened
through EasyInvest(SM), an automatic purchase plan). The Trust reserves the
right to redeem, upon sixty days' notice and at net asset value, the shares
of any shareholder, other than a shareholder that is an IRA or other
tax-deferred retirement plan, whose shares have a value of less than $100 as
a result of redemptions or repurchases, or such lesser amount as may be fixed
by the Board of Trustees. The Trust will notify such shareholder that the
value of its shares is less than the applicable amount and allow the
shareholder to make additional investment in an amount which will increase
the value of the account to at least the applicable amount or more before the
redemption.
(m) Qualification as a Regulated Investment Company. The Trust intends to
continue to qualify for treatment as a regulated investment company under the
Internal Revenue Code of 1986, as amended, after conversion to open-end
status, so that it will continue to be relieved of federal income tax on that
part of its investment company taxable income and net capital gain that is
distributed to its shareholders. To qualify for this treatment the Trust must
currently meet several requirements, one of which is that the Trust must
derive less than 30% of its gross income each taxable year from the sale or
other disposition of securities, options or futures contracts held for less
than three months.
(n) Multiple Classes of Shares. If the Trust is converted to an open-end
fund, it may issue additional classes of its shares. Each class of shares
would represent interests in the same portfolio of investments of the Trust
but may have different sales charges and 12b-1 fees. It is anticipated that
Shareholders of the Trust upon conversion would receive shares of the class
with a 0.25% 12b-1 fee and a front-end sales charge but would be exempt from
any such front-end sales charge with respect to shares owned on the
conversion date.
REQUIRED VOTE
Approval of this stockholder proposal requires the affirmative vote of a
majority of the votes cast at a meeting at which a quorum is present. Under
the Trust's By-laws, the presence in person or by proxy of shareholders
entitled to cast a majority of the votes entitled to be cast thereat shall
constitute a quorum.
RECOMMENDATION OF THE BOARD OF TRUSTEES
FOR THE REASONS SET FORTH ABOVE, THE BOARD OF TRUSTEES UNANIMOUSLY
BELIEVES THAT THE SHAREHOLDER PROPOSAL RELATING TO CONVERTING TO AN OPEN-END
INVESTMENT COMPANY IS APPROPRIATE FOR SHAREHOLDER DETERMINATION AND NEITHER
SUPPORTS OR OPPOSES THE RESOLUTION CONTAINED IN THE PROPOSAL.
(5) IF PROPOSAL NO. 4 IS APPROVED, TO APPROVE THE CONVERSION OF THE TRUST
FROM A CLOSED-END INVESTMENT COMPANY TO AN OPEN-END INVESTMENT COMPANY AND TO
AMEND THE TRUST'S DECLARATION OF TRUST
CONVERSION TO AN OPEN-END INVESTMENT COMPANY
The shareholder proposal is framed as a recommendation that the Board of
Trustees take action to convert the Trust from a closed-end fund to an
open-end fund. Because it is merely a recommendation and is not
self-operative additional matters would need to be voted on by the Board and
by shareholders in order to implement a conversion from closed-end status to
open-end status. At a meeting held on February 19, 1997, the Board of
Trustees determined that should the shareholder proposal be approved by
shareholders, the Trust should be converted to an open-end fund as described
below. Accordingly, in order to eliminate the need for a subsequent meeting
of shareholders to vote on those matters necessary to implement such a
conversion, and
21
the preparation of a separate proxy statement related thereto, the Board
unanimously approved the submission to shareholders of proposals 5 through 10
set forth below, each of which must be approved in order to implement a
conversion from closed-end to open-end status (the "Conversion").
Although management will use all practicable measures to keep costs at a
minimum, certain costs will be incurred, many of which will be nonrecurring,
in connection with the Conversion, including costs associated with the
seeking of necessary government clearances, the preparation of a registration
statement and prospectuses as required by federal securities laws (including
printing, mailing and legal costs) and the payment of necessary filing fees
under the securities laws of various states. The Trust estimates that these
additional costs, which will be paid by the Trust, will amount to
approximately $175,000. The Board anticipates that substantially all of these
costs will be incurred by the Trust prior to the effective date of the
Conversion.
Neither the Trust nor its shareholders will realize any gain or loss for
tax purposes as a result of the Trust's conversion. However, the shareholders
will recognize a gain or loss if they later redeem their shares to the extent
that the redemption proceeds are greater or less than the respective adjusted
tax bases of their shares. Payment for any such redemption will be made
within seven days after receipt of a proper request for redemption (in
accordance with redemption procedures specified in the prospectus). Such
payment may be postponed or the right of redemption suspended under unusual
circumstances that affect the ability to value the securities in the Trust's
portfolio, e.g., when normal trading is not taking place on the NYSE or when
an emergency makes it not reasonably practicable for the Trust to dispose of
portfolio securities or fairly to determine the value of its net assets.
AMENDMENT OF THE TRUST'S DECLARATION OF TRUST
If the Conversion is approved, the conversion of the Trust to an open-end
investment company will be accomplished by amending and restating the Trust's
Declaration of Trust to, among other things, authorize the issuance of
redeemable securities, provide that the Trust's outstanding shares will be
redeemable at the option of the shareholders, change the Trust's
subclassification under the 1940 Act from a closed-end investment company to
an open-end investment company and provide for the issuance of multiple
classes of shares. In connection with the amendment and restatement of the
Declaration of Trust, the Board of Trustees will also make necessary
conforming changes to the By-Laws of the Trust including those necessary to
provide that the Trust will not be required to hold an annual meeting in any
year in which it is not required to do so under the 1940 Act.
The proposed Amended and Restated Declaration of Trust reflects the
changes necessary for the Trust to operate as an open-end investment company
as noted above. In addition to the substantive changes enumerated in the
preceding paragraph, the proposed Amended and Restated Declaration of Trust
no longer contains provisions requiring supermajority shareholder approval of
a merger, consolidation or sale of all or substantially all the assets of the
Trust and providing that Trustees may only be removed for cause by the
remaining trustees and by an 80% vote of approval by the Trust's outstanding
shares. While these provisions, which generally serve to discourage a change
in the control or structure of a company that is not supported by its board
of trustees, are often part of the governing documents of closed-end
investment companies whose shares are traded on the open market, these
provisions are less necessary for an open-end investment company.
Accordingly, the Amended and Restated Declaration of Trust proposes to delete
those provisions previously requiring shareholder approval of a merger,
consolidation or sale of all or substantially all the assets of the Trust by
the affirmative vote of at least 80% of the Trust's outstanding shares, and
provide, instead, that the vote of at least two-thirds of the Trust's
outstanding shares be required to approve such changes; provided, however,
that if such a change is recommended by the Trustees, then a majority of
shares represented and entitled to vote at a meeting at which a quorum is
present shall be sufficient to approve such changes. In addition, the Amended
22
and Restated Declaration of Trust proposes to delete the provision specifying
that a trustee can only be removed for cause by the remaining trustees and by
an 80% vote of approval by the shareholders. Instead, the Amended and
Restated Declaration of Trust will provide that a trustee may be removed for
any reason by the action of two-thirds of the remaining trustees and by the
affirmative vote of not less than two-thirds of the Trust's outstanding
shares.
If Proposal No. 4 and Proposals 5-10 are approved by shareholders, the
proposed Amended and Restated Declaration of Trust, a copy of which is
attached to this Proxy Statement as Exhibit A, is expected to be filed with
the Secretary of the Commonwealth of Massachusetts to become effective
simultaneously with the Conversion. Such filing will not be made, however,
until shortly before a registration statement under the Securities Act of
1933 covering the offering of the shares of the Trust and the Trust's state
securities registrations are anticipated to become effective. The
registration statement would not be filed before the Conversion is approved
by Shareholders.
REQUIRED VOTE
Under the Trust's Declaration of Trust, conversion of the Trust from a
closed-end investment company to an open-end investment company requires the
affirmative vote of a majority of the Trust's shares outstanding and entitled
to vote. If the proposal to convert the Trust is not approved by the
shareholders, the Trust will continue to operate as a closed-end fund, the
current provisions of the Trust's Declaration of Trust will remain in effect,
and the Board will consider what further actions, if any, are desirable to
reduce the discount at which the Trust's shares have traded.
THE TRUSTEES UNAMIMOUSLY RECOMMEND THAT THE SHAREHOLDERS VOTE "FOR" THIS
PROPOSAL TO APPROVE THE CONVERSION AND TO AMEND THE DECLARATION OF TRUST IF
PROPOSAL NO. 4 IS APPROVED.
(6) IF PROPOSAL NO. 4 IS APPROVED, TO APPROVE THE ELECTION OF NINE TRUSTEES
As prescribed in the Trust's Declaration of Trust and By-Laws, the
Trustees were divided into three classes and their initial terms of office
were staggered so that one class would be elected each year thereafter for a
three-year term. The number of Trustees has currently been fixed by the
Trustees, pursuant to the Trust's Declaration of Trust, at nine with their
terms of office fixed as follows: Class I: Messrs. Haire, Johnson, Schroeder
and Stern; Class II: Messrs. DeMartini and Larkin; and Class III: Messrs.
Argue, Fiumefreddo and Nugent.
The classified Board was intended, in part, to make it more difficult and
time-consuming to change majority control of the Board of Trustees without
its consent and thus to reduce the Trust's vulnerability to an unsolicited
takeover proposal or similar action that does not contemplate an acquisition
of all outstanding voting stock of the Trust. However, the conversion of the
Trust to an open-end investment company would reduce, if not eliminate, the
need for this precautionary measure. Therefore, the Board of Trustees has
considered and approved the declassification of the Board in the event that
the proposed conversion of the Trust to open-end status is approved.
Five of the current Trustees (Messrs. Argue, Haire, Johnson, Nugent and
Schroeder) are "Independent Trustees," that is, Trustees who are not
"interested persons" of the Trust, as that term is defined in the 1940 Act.
The nominees for election as Trustees have been proposed by the Trustees now
serving or, in the case of nominees for positions as Independent Trustees, by
the Independent Trustees now serving. All of the Trustees have been elected
by the shareholders of the Trust.
Accordingly, if Proposals No. 4 and 5 are approved, the Board of Trustees
will be declassified and all nine Trustees will be elected to hold office
until the next meeting of shareholders at which Trustees are elected and
23
their successors shall have been elected and qualified. After the Conversion
is effected, the Trust will not be required to hold annual meetings of
shareholders and does not intend to hold such meetings unless required by law
to do so. It is the intention of the persons named in the accompanying form
of Proxy to vote in favor of the election of Messrs. Larkin, Haire, Johnson,
Schroeder, Stern, DeMartini, Argue, Fiumefreddo and Nugent, all of whom are
currently members of the Board of Trustees, if Proposal No. 4 is approved.
Should any of the nominees become unable or unwilling to accept nomination or
election, the persons named in the proxy will exercise their voting power in
favor of such person or persons as the Board may recommend. All of the
nominees have consented to being named in this Proxy Statement and to serve
if elected. The Trust knows of no reason why said nominees would be unable or
unwilling to accept nomination or election. The Trustees will be elected by a
plurality of the votes cast at the Meeting.
The information regarding each of the nine nominees for election as
Trustee and each of the members of the Board includes his principal
occupations and employment for at least the last five years, his age, shares
of the Trust owned, if any, as of April 24, 1997 (shown in parentheses),
positions with the Trust, and directorships or trusteeships in other
companies which file periodic reports with the SEC, including the 83
investment companies, including the Trust, for which InterCapital serves as
investment manager or adviser (referred to herein as the "Dean Witter Funds")
and the 14 investment companies for which InterCapital's wholly-owned
subsidiary, Dean Witter Services Company Inc. ("DWSC"), serves as the manager
and TCW Funds Management, Inc. serves as the investment adviser (referred to
herein as the "TCW/DW Funds") is set forth under Proposal No. 1. Please also
see Proposal No. 1 for a description of the Duties of the Board of Trustees,
the Independent Trustees, the Committees and the Compensation of the Trustees
on pages 3-10.
REQUIRED VOTE
The election of the nine nominees as Trustees requires the affirmative
vote of a majority of the shares represented in person or by proxy and
entitled to vote at a meeting at which a quorum is present.
THE TRUSTEES UNANIMOUSLY RECOMMEND THAT THE SHAREHOLDERS VOTE "FOR" THE
ELECTION OF THE NINE NOMINEES AS TRUSTEES, IF PROPOSAL NO. 4 IS APPROVED.
(7) IF PROPOSAL NUMBER 4 IS APPROVED, TO APPROVE A
NEW INVESTMENT ADVISORY AGREEMENT
On April 24, 1997, a majority of the Board of Trustees, including a
majority of the Independent Trustees, approved a new investment advisory
agreement between the Trust and TCW Funds Management, Inc. (the "New
Investment Advisory Agreement"). The terms of the New Investment Advisory
Agreement are similar to the terms of the investment advisory agreement
currently in effect between the Trust and the Investment Advisor dated March
23, 1994 and amended June 27, 1996 (the "Current Investment Advisory
Agreement"), except as discussed below. If Proposal No. 4 and this Proposal
No. 7 are approved by the shareholders of the Trust, the Current Investment
Advisory Agreement will be terminated and the New Investment Advisory
Agreement will become effective upon effectiveness of the Conversion. If for
any reason the Conversion is not effected, the Current Investment Advisory
Agreement will remain in effect. The form of New Investment Advisory
Agreement is attached to this Proxy Statement as Exhibit B.
THE INVESTMENT ADVISORY AGREEMENT
The terms of the Current Investment Advisory Agreement are set forth under
Proposal No. 2. The New Investment Advisory Agreement will modify the terms
of the Current Investment Advisory Agreement in certain minor respects to
reflect the Trust's operation as an open-end investment company. In addition,
because
24
the Trust will calculate its net asset value daily rather than weekly, the
fee payable under the New Investment Advisory Agreement will be based on a
percentage of the Trust's average daily net assets. The investment advisory
fee is currently based on a percentage of the Trust's average weekly net
assets. Specifically, under the New Investment Advisory Agreement, the
advisory fee payable to the Investment Adviser by the Trust will be at an
annual rate of 0.50 of 1% of the Trust's average daily net assets.
If Proposals No. 4 and 7 are not approved, the Current Investment Advisory
Agreement will remain in effect in accordance with its terms.
REQUIRED VOTE
The favorable vote of a majority of the outstanding voting securities of
the Trust (as defined in the 1940 Act and set forth above in Proposal No. 2)
is required for the approval of the new Advisory Agreement.
THE TRUSTEES UNANIMOUSLY RECOMMEND THAT THE SHAREHOLDERS VOTE "FOR" THE
APPROVAL OF THE NEW ADVISORY AGREEMENT, IF PROPOSAL NO. 4 IS APPROVED.
(8) IF PROPOSAL NUMBER 4 IS APPROVED, TO APPROVE
A NEW SUB-ADVISORY AGREEMENT BETWEEN TCW FUNDS MANAGEMENT, INC. AND TCW
LONDON INTERNATIONAL, LIMITED
(9) IF PROPOSAL NUMBER 4 IS APPROVED, TO APPROVE
A NEW SUB-ADVISORY AGREEMENT BETWEEN TCW FUNDS MANAGEMENT, INC. AND TCW ASIA
LIMITED
On April 24, 1997, a majority of the Board of Trustees, including a
majority of the Independent Trustees, approved two sub-advisory agreements
(the "New Sub-Advisory Agreements") between the Trust and TCW London
International, Limited ("TCW London") and TCW Asia Limited ("TCW Asia")
(collectively, the "Sub-Advisers"). The terms of the New Sub-Advisory
Agreements are similar to the terms of the sub-advisory agreements currently
in effect between the Trust and the Sub-Advisers dated June 26, 1996 (the
"Current Sub-Advisory Agreements"), except as discussed below. If Proposals
No. 8 and 9 are approved by shareholders of the Trust, the Current
Sub-Advisory Agreements will be terminated and the New Sub-Advisory
Agreements will become effective upon effectiveness of the Conversion. If for
any reason the Conversion is not effected, the Current Sub-Advisory
Agreements will remain in effect. The form of the New Sub-Advisory Agreements
are attached to this Proxy Statement as Exhibits C and D.
THE CURRENT SUB-ADVISORY AGREEMENTS
TCW Funds Management, Inc. ("Investment Adviser") entered into
sub-advisory agreements ("Sub-Advisory Agreements") with respect to the
TCW/DW Emerging Markets Opportunities Trust ("Trust") with two affiliated
companies TCW Asia Limited ("TCW Asia") and TCW London International, Limited
("TCW London") (collectively, the "Sub-Advisers"), which are both registered
investment advisers under the Investment Advisers Act of 1940. The
Sub-Advisory Agreements were initially approved by the Board of Trustees of
the Trust, including all of the Independent Trustees, at a meeting held on
April 17, 1996 and were approved by the shareholders at their Annual Meeting
held on June 27, 1996.
SUB-ADVISORY AGREEMENT WITH TCW LONDON INTERNATIONAL, LIMITED
The current Sub-Advisory Agreement with TCW London provides the Trust with
investment advisory services including, but not limited to, obtaining and
evaluating such information and advice relating to the
25
economy, securities and commodities markets and securities and commodities as
it deems necessary or useful to discharge its duties hereunder and will
manage the assets of the Trust in a manner consistent with the Trust's
investment objectives and policies. Under the Sub-Advisory Agreement, TCW
London determines which securities and commodities to be purchased, acquired,
sold or otherwise disposed of by the Trust and the timing of such purchases,
acquisitions, sales or dispositions. TCW London furnishes the Investment
Adviser with the information, evaluations, analyses and opinions formulated
or obtained by it in performing its services under this Sub-Advisory
Agreement. All security transactions are reviewed by the Investment Adviser
and are, in every instance, subject to the overall supervision of the
Investment Adviser (See "The Investment Advisory Agreement" above).
The Sub-Advisory Agreement provides that TCW London shall, at its own
expense, maintain such staff and employ or retain such personnel and consult
with such other persons as it shall, from time to time, determine to be
necessary or useful to the performance of its obligations under the
Sub-Advisory Agreement.
In return for the services it renders under the Sub-Advisory Agreement,
TCW London receives from the Investment Adviser, monthly compensation,
determined by applying the annual rate of 0.50% to the Trust's average weekly
net assets for which TCW London renders sub-advisory services. The
compensation of TCW London is a responsibility of the Investment Adviser and
not a responsibility of the Trust.
The Sub-Advisory Agreement with TCW London had an initial term ending
April 30, 1997 and provides that, after this period, it will continue in
effect from year to year thereafter provided such continuance is approved at
least annually by the vote of holders of a majority, as defined in the Act,
of the outstanding voting securities of the Trust or by the Trustees of the
Trust and, in either event, by vote cast in person by a majority of the
Trustees who are not parties to the Sub-Advisory Agreement or "interested
persons" of any such party (as defined in the Act) at a meeting called for
the purpose of voting on such approval. The Sub-Advisory Agreement's most
recent continuation until April 30, 1998, was approved by the Trustees,
including a majority of the Independent Trustees, at a Meeting of the
Trustees held on April 24, 1997, called for the purpose of approving the
Sub-Advisory Agreement.
The Sub-Advisory Agreement also provides that it may be terminated at any
time by the Trust, the Investment Adviser, TCW London, the Trustees of the
Trust or by a vote of the outstanding voting securities of the Trust, in each
instance without the payment of any penalty, on thirty days notice and will
automatically terminate upon any assignment.
The current Sub-Advisory Agreement with TCW Asia provides the Trust with
investment advisory services including, but not limited to, obtaining and
evaluating such information and advice relating to the economy, securities
and commodities markets and securities and commodities as it deems necessary
or useful to discharge its duties hereunder and will manage the assets of the
Trust in a manner consistent with the Trust's investment objectives and
policies. Under the Sub-Advisory Agreement, TCW Asia determines which
securities and commodities to be purchased, acquired, sold or otherwise
disposed of by the Trust and the timing of such purchases, acquisitions,
sales or dispositions. TCW Asia furnishes the Investment Adviser with the
information, evaluations, analyses and opinions formulated or obtained by it
in performing its services under this Sub-Advisory Agreement. All security
transactions are reviewed by the Investment Adviser and are, in every
instance, subject to the overall supervision of the Investment Adviser (See
"The Investment Advisory Agreement" above).
The Sub-Advisory Agreement provides that TCW Asia shall, at its own
expense, maintain such staff and employ or retain such personnel and consult
with such other persons as it shall, from time to time, determine to be
necessary or useful to the performance of its obligations under the
Sub-Advisory Agreement.
26
In return for the services it renders under the Sub-Advisory Agreement,
TCW Asia receives from the Investment Adviser, monthly compensation,
determined by applying the annual rate of 0.50% to the Trust's average weekly
net assets for which TCW Asia renders sub-advisory services. The compensation
of TCW Asia is a responsibility of the Investment Adviser and not a
responsibility of the Trust.
The Sub-Advisory Agreement had an initial term ending April 30, 1997 and
provides that, after this period, it will continue in effect from year to
year thereafter provided such continuance is approved at least annually by
the vote of holders of a majority, as defined in the Act, of the oustanding
voting securities of the Trust or by the Trustees of the Trust and, in either
event, by vote cast in person by a majority of the Trustees who are not
parties to the Sub-Advisory Agreement or "interested persons" of any such
party (as defined in the Act) at a meeting called for the purpose of voting
on such approval. The Sub-Advisory Agreement's most recent continuation until
April 30, 1998, was approved by the Trustees, including a majority of the
Independent Trustees, at a Meeting of the Trustees held on April 24, 1997,
called for the purpose of approving the Sub-Advisory Agreement.
The Sub-Advisory Agreement also provides that it may be terminated at any
time by the Trust, the Investment Adviser, TCW Asia, the Trustees of the
Trust or by a vote of the outstanding voting securities of the Trust, in each
instance without the payment of any penalty, on thirty days notice and will
automatically terminate upon any assignment.
THE NEW SUB-ADVISORY AGREEMENTS
The New Sub-Advisory Agreements will modify the terms of the Current
Sub-Advisory Agreements in certain minor respects to reflect the Trust's
operation as an open-end investment company. In addition, because the Trust
will calculate its net asset value daily rather than weekly, the fee payable
under the New Sub-Advisory Agreements will be based on a percentage of the
Trust's average daily net assets. The sub-advisory fee is currently based on
a percentage of the Trust's average weekly net assets. Specifically, under
the New Sub-Advisory Agreements, the sub-advisory fee payable to the
Sub-Advisers by the Investment Adviser will be at an annual rate of 0.50 of
1% of the Trust's average daily net assets for which the Sub-Adviser renders
sub-advisory services.
If Proposals No. 4, 8 and 9 are not approved, the Current Sub-Advisory
Agreements will remain in effect in accordance with their terms.
REQUIRED VOTE
The favorable vote of a majority of the outstanding voting securities of
the Trust (as defined in the 1940 Act and as set forth above in Proposal No.
2) is required for the approval of the New Sub-Advisory Agreements.
THE TRUSTEES UNANIMOUSLY RECOMMEND THAT THE SHAREHOLDERS VOTE "FOR" THE
APPROVAL OF THE NEW SUB-ADVISORY AGREEMENTS, IF PROPOSAL NO. 4 IS APPROVED.
(10) IF PROPOSAL NUMBER 4 IS APPROVED, TO APPROVE A PLAN OF DISTRIBUTION
On April 24, 1997, the Board of Trustees of the Trust, including a
majority of the Independent Trustees who have no direct or indirect financial
interest in the proposed Plan of Distribution pursuant to Rule 12b-1 under
the 1940 Act (the "Plan") or any related agreement (the "Independent 12b-1
Trustees"), approved the Plan and a distribution agreement for the Trust's
existing shares (the "Distribution Agreement") in connection with the
conversion of the Trust from a closed-end investment company to an open-end
investment company.
27
The Board of Trustees recommends the Plan to the shareholders of the Trust
for approval or disapproval at this Meeting of Shareholders. The Distribution
Agreement does not require and, is not being submitted for, shareholder
approval.
The purpose of the Plan is to compensate the Distributor for services it
or any selected dealer provides and to reimburse the Distributor and others
for expenses borne in connection with the distribution of the Trust's shares.
If Proposal No. 10 is approved and the Plan implemented, the Plan will be
applicable to the shares of the Trust (the existing shares of the Trust) and
will become effective upon conversion of the Trust to open-end status. If for
any reason the Conversion is not effected, the Plan would not be appropriate
and, therefore, would not become effective. The form of the Plan is attached
to this Proxy Statement as Exhibit E.
The Plan authorizes the Trust to compensate the Distributor for all costs
incurred by it in distributing the shares of the Trust at an annual rate not
to exceed .25 of 1% per annum of the average monthly net assets of the Trust.
The Plan specifies categories of compensable expenditures which include: the
payment of commissions for sale of the Trust's shares and incentive
compensation to and expenses of DWR's account executives and others who
engage in or support distribution or shares or who service shareholder
accounts, including overhead and telephone expenses; printing and
distribution of prospectuses and reports used in connection with the offering
of the Trust's shares to other than current shareholders; and preparation,
printing and distribution of sales literature and advertising materials.
Under the Plan, the Trust is obligated to reimburse the Distributor, DWR,
its affiliates and other broker-dealers for distribution expenses incurred by
them specifically on behalf of the Trust. If the Distributor's expenses
exceed the amounts of payments made by the Trust, the Trust will not be
obligated to pay any additional expenses in the year incurred or in later
years. If the Distributor's expenses are less than the amount of payments
made by the Trust, it will make reimbursement to the Trust.
In considering whether or not to approve the Plan, the Board reviewed,
among other things, the nature and scope of the services to be provided by
the Distributor, the Board also considered the potential benefit of the Plan
to shareholders and potential investors. The Trustees took into account the
competitive market environment in which the Trust will operate as an open-end
investment company. More specifically, the Trustees recognized the need to
provide adequate compensation to broker-dealers who serve existing
shareholders or offer the Trust to prospective shareholders. Without such
service, the Trust would incur a substantial risk that it could not maintain
or increase its assets, threatening the viability of the Trust as an
investment company. Based upon their review, the Trustees, including a
majority of the Independent 12b-1 Trustees, determined that there is a
reasonable likelihood that the Plan will benefit the Trust and its
shareholders.
As required by Rule 12b-1 under the 1940 Act, if approved by the
shareholders, the Plan will continue in effect from year to year, provided
such continuance is approved at least annually by a majority of the Board of
Trustees and a majority of the Independent 12b-1 Trustees by votes cast in
person at a meeting called for the purpose of voting on the continuation of
the Plan. The Plan may not be amended to increase materially the amount to be
spent for the services described therein without approval by a majority of
the outstanding shareholders of the Trust. All material amendments of the
Plan must also be approved by the Trustees in the manner described above. The
Plan may be terminated at any time without payment of any penalty by vote of
a majority of the Independent 12b-1 Trustees or by the vote of a majority of
the outstanding shares of the Trust (as defined in the 1940 Act) on not more
than 30 days' written notice to any other party to the Plan. So long as the
Plan is in effect, the election and nomination of the Independent Trustees
will be committed to the discretion of the Independent Trustees.
28
REQUIRED VOTE
The proposed Plan of Distribution requires approval of a majority of the
outstanding voting securities of the Trust (as defined in the 1940 Act and
set forth above in Proposal No. 2).
THE TRUSTEES UNANIMOUSLY RECOMMEND THAT THE SHAREHOLDERS VOTE "FOR" THE
APPROVAL OF THE 12B-1 PLAN, IF PROPOSAL NO. 4 IS APPROVED.
ADDITIONAL INFORMATION
In the event that the necessary quorum to transact business or the vote
required to approve or reject any proposal is not obtained at the Meeting,
the persons named as proxies may propose one or more adjournments of the
Meeting for a total of not more than 60 days in the aggregate to permit
further solicitation of proxies. Any such adjournment will require the
affirmative vote of the holders of a majority of the Trust's shares present
in person or by proxy at the Meeting. The persons named as proxies will vote
in favor of such adjournment those proxies which they are entitled to vote in
favor of Proposal 2 and will vote against any such adjournment those proxies
required to be voted against that proposal.
Abstentions and, if applicable, broker "non-votes" will not count as votes
in favor of any of the proposals, and broker "non-votes" will not be deemed
to be present at the meeting for purposes of determining whether a particular
proposal to be voted upon has been approved. Broker "non-votes" are shares
held in street name for which the broker indicates that instructions have not
been received from the beneficial owners or other persons entitled to vote
and for which the broker does not have discretionary voting authority.
SHAREHOLDER PROPOSALS
Proposals of security holders intended to be presented at the next Annual
Meeting of Shareholders must be received no later than December 31, 1997 for
inclusion in the proxy statement and proxy for that meeting.
REPORTS TO SHAREHOLDERS
The Trust's most recent Annual Report, for the fiscal year ended January
31, 1997, has been previously sent to Shareholders and is available without
charge upon request from Adrienne Ryan-Pinto at Dean Witter Trust Company,
Harborside Financial Center, Plaza Two, Jersey City, New Jersey 07311
(telephone 1-800-869-NEWS) (toll free).
OTHER BUSINESS
The management knows of no other matters which may be presented at the
Meeting. However, if any matters not now known properly come before the
Meeting, it is intended that the persons named in the attached form of proxy,
or their substitutes, will vote such proxy in accordance with their judgment
on such matters.
By Order of the Trustees
BARRY FINK
Secretary
29
APPENDIX A
TCW Funds Management Inc. serves as investment adviser to the Trust as
well as investment adviser or sub-adviser to the other investment companies
listed below which have similar investment objectives to that of the Trust,
with net assets shown as of March 31, 1997.
ANNUAL
MANAGEMENT
FEE AS PERCENT
NET ASSETS ON OF AVERAGE
NAME MARCH 31, 1997 NET ASSETS
- ------------------------------------------------- -------------- --------------
TCW/DW Emerging Markets Opportunities Trust ...... $309,614,389 (1)
TCW Galileo Funds, Inc.
TCW Galileo Asia Pacific Equity Fund............. 45,750,458 (2)
TCW Galileo Emerging Markets Fund................ 67,053,485 (2)
TCW Galileo Latin America Fund................... 78,441,243 (2)
TCW/DW Latin American Growth Fund................. 287,861,714 (3)
Dean Witter Select Dimensions Investment Series--
Emerging Markets Portfolio ..................... 22,019,472 (4)
- ----------
1. 0.50% of the Trust's weekly net assets.
2. 1.00% of the Fund's annual net asset value.
3. 0.50% of the Fund's daily net assets.
4. 1.25% of the Portfolio's daily net assets paid to Dean Witter
InterCapital, Inc. pursuant to an Investment Management Agreement of
which 0.40% is paid to TCW Funds Management Inc., the Sub-Adviser,
pursuant to a Sub-Advisory Agreement. InterCapital has undertaken, until
the earlier of December 31, 1996 or the attainment by the respective
Portfolio of $50 million of net assets, to continue to assume all
operating expenses of the Portfolios of Dean Witter Select Dimensions
Investment Series (except for any brokerage fees and a portion of
organizational expenses) and to waive the compensation provided for in
its investment management agreement with that company in respect of each
Portfolio to the extent that such expenses and compensation on an
annualized basis exceed 0.50% of the average daily net assets of the
Portfolio.
A-1
EXHIBIT A
TCW/DW EMERGING MARKETS
OPPORTUNITIES TRUST
TWO WORLD TRADE CENTER
NEW YORK, NY 10048
AMENDED AND RESTATED
DECLARATION OF TRUST
DATED: , 1997
AMENDED AND RESTATED
DECLARATION OF TRUST
OF
TCW/DW EMERGING MARKETS OPPORTUNITIES TRUST
DATED: , 1997
THE DECLARATION OF TRUST of TCW/DW Emerging Markets Opportunities Trust is
made the day of , 1997 by the parties signatory hereto, as trustees
(such persons, so long as they shall continue in office in accordance with
the terms of this Declaration of Trust, and all other persons who at the time
in question have been duly elected or appointed as trustees in accordance
with the provisions of this Declaration of Trust and are then in office,
being hereinafter called the "Trustees")
WITNESSETH:
WHEREAS, the Trustees desire to form a trust fund under the laws of
Massachusetts for the investment and reinvestment of funds contributed
thereto; and
WHEREAS, it is provided that the beneficial interest in the trust assets
be divided into transferable shares of beneficial interest as hereinafter
provided;
NOW, THEREFORE, the Trustees hereby declare that they will hold in trust,
all money and property contributed to the trust fund to manage and dispose of
the same for the benefit of the holders from time to time of the shares of
beneficial interest issued hereunder and subject to the provisions hereof, to
wit:
1
ARTICLE I
NAME AND DEFINITIONS
Section 1.1. Name. The name of the trust created hereby is the " TCW/DW
Emerging Markets Opportunities Trust," and so far as may be practicable the
Trustees shall conduct the Trust's activities, execute all documents and sue
or be sued under that name, which name (and the word "Trust" wherever herein
used) shall refer to the Trustees as Trustees, and not as individuals, or
personally, and shall not refer to the officers, agents, employees or
Shareholders of the Trust. Should the Trustees determine that the use of such
name is not advisable, they may use such other name for the Trust as they
deem proper and the Trust may hold its property and conduct its activities
under such other name.
Section 1.2. Definitions. Wherever they are used herein, the following
terms have the following respective meanings:
(a) "By-Laws" means the By-Laws referred to in Section 3.9 hereof, as
from time to time amended.
(b) the terms "Commission," "Affiliated Person" and "Interested Person,"
have the meanings given them in the 1940 Act.
(c) "Declaration" means this Declaration of Trust as amended from time
to time. Reference in this Declaration of Trust to "Declaration,"
"hereof," "herein" and "hereunder" shall be deemed to refer to this
Declaration rather than the article or section in which such words
appear.
(d) "Distributor" means the party, other than the Trust, to a contract
described in Section 4.3 hereof.
(e) "Fundamental Policies" shall mean the investment policies and
restrictions set forth in the Prospectus and Statement of Additional
Information and designated as fundamental policies therein.
(f) "Investment Adviser" means any party, other than the Trust, to an
investment advisory contract described in Section 4.1 hereof.
(g) "Majority Shareholder Vote" means the vote of the holders of a
majority of Shares, which shall consist of: (i) a majority of Shares
represented in person or by proxy and entitled to vote at a meeting of
Shareholders at which a quorum, as determined in accordance with the
By-Laws, is present; (ii) a majority of Shares issued and outstanding and
entitled to vote when action is taken by written consent of Shareholders;
and (iii) a "majority of the outstanding voting securities," as the
phrase is defined in the 1940 Act, when any action is required by the
1940 Act by such majority as so defined.
(h) "Manager" means any party, other than the Trust, to a management
contract described in Section 4.1 hereof.
(i) "1940 Act" means the Investment Company Act of 1940 and the rules
and regulations thereunder as amended from time to time.
(j) "Person" means and includes individuals, corporations, partnerships,
trusts, associations, joint ventures and other entities, whether or not
legal entities, and governments and agencies and political subdivisions
thereof.
2
(k) "Prospectus" means the Prospectus and Statement of Additional
Information constituting parts of the Registration Statement of the Trust
under the Securities Act of 1933 as such Prospectus and Statement of
Additional Information may be amended or supplemented and filed with the
Commission from time to time.
(l) "Series" means one of the separately managed components of the Trust
(or, if the Trust shall have only one such component, then that one) as
set forth in Section 6.1 hereof or as may be established and designated
from time to time by the Trustees pursuant to that section.
(m) "Shareholder" means a record owner of outstanding Shares.
(n) "Shares" means the units of interest into which the beneficial
interest in the Trust shall be divided from time to time, including the
shares of any and all series or classes which may be established by the
Trustees, and includes fractions of Shares as well as whole Shares.
(o) "Transfer Agent" means the party, other than the Trust, to the
contract described in Section 4.4 hereof.
(p) "Trust" means the TCW/DW Emerging Markets Opportunities Trust .
(q) "Trust Property" means any and all property, real or personal,
tangible or intangible, which is owned or held by or for the account of
the Trust or the Trustees.
(r) "Trustees" means the persons who have signed the Declaration, so
long as they shall continue in office in accordance with the terms
hereof, and all other persons who may from time to time be duly elected
or appointed, qualified and serving as Trustees in accordance with the
provisions hereof, and reference herein to a Trustee or the Trustees
shall refer to such person or persons in their capacity as trustees
hereunder.
ARTICLE II
TRUSTEES
Section 2.1. Number of Trustees. The number of Trustees shall be such
number as shall be fixed from time to time by a written instrument signed by
a majority of the Trustees, provided, however, that the number of Trustees
shall in no event be less than three (3) nor more than fifteen (15).
Section 2.2. Election and Term. The Trustees shall be elected by a vote of
a majority of the outstanding voting securities, as defined by the 1940 Act,
held by the initial shareholder(s) (i.e., the person(s) that supplied the
seed capital required under Section 14(a) of the 1940 Act). The Trustees
shall have the power to set and alter the terms of office of the Trustees,
and they may at any time lengthen or lessen their own terms or make their
terms of unlimited duration, subject to the resignation and removal
provisions of Section 2.3 hereof. Subject to Section 16(a) of the 1940 Act,
the Trustees may elect their own successors and may, pursuant to Section 2.4
hereof, appoint Trustees to fill vacancies. The Trustees shall adopt By-Laws
not inconsistent with this Declaration or any provision of law to provide for
election of Trustees by Shareholders at such time or times as the Trustees
shall determine to be necessary or advisable.
Section 2.3. Resignation and Removal. Any Trustee may resign his trust
(without need for prior or subsequent accounting) by an instrument in writing
signed by him and delivered to the other Trustees and such resignation shall
be effective upon such delivery, or at a later date according to the terms of
the instrument. Any of the Trustees may be removed (provided the aggregrate
number of Trustees after such removal shall not be less than the number
required by Section 2.1 hereof) by the action of two-thirds of
3
the remaining Trustees or by the action of the Shareholders of record of not
less than two-thirds of the Shares outstanding (for purposes of determining
the circumstances and procedures under which such removal by the Shareholders
may take place, the provisions of Section 16(c) of the 1940 Act or of the
corporate or business statute of any state in which Shares of the Trust are
sold, shall be applicable to the same extent as if the Trust were subject to
the provisions of that Section). Upon the resignation or removal of a
Trustee, or his otherwise ceasing to be a Trustee, he shall execute and
deliver such documents as the remaining Trustees shall require for the
purpose of conveying to the Trust or the remaining Trustees any Trust
Property held in the name of the resigning or removed Trustee. Upon the
incapacity or death of any Trustee, his legal representative shall execute
and deliver on his behalf such documents as the remaining Trustees shall
require as provided in the preceding sentence.
Section 2.4. Vacancies. The term of office of a Trustee shall terminate
and a vacancy shall occur in the event of the death, resignation, removal,
bankruptcy, adjudicated incompetence or other incapacity to perform the
duties of the office of a Trustee. No such vacancy shall operate to annul the
Declaration or to revoke any existing agency created pursuant to the terms of
the Declaration. In the case of an existing vacancy existing by reason of an
increase in the number of Trustees, subject to the provisions of Section
16(a) of the 1940 Act, the remaining Trustees shall fill such vacancy by the
appointment of such other person as they or he, in their or his discretion,
shall see fit, made by a written instrument signed by a majority of the
remaining Trustees. Any such appointment shall not become effective, however,
until the person named in the written instrument of appointment shall have
accepted in writing such appointment and agreed in writing to be bound by the
terms of the Declaration. An appointment of a Trustee may be made in
anticipation of a vacancy to occur at a later date by reason of retirement,
resignation or increase in the number of Trustees, provided that such
appointment shall not become effective prior to such retirement, resignation
or increase in the number of Trustees. Whenever a vacancy in the number of
Trustees shall occur, until such vacancy is filled as provided in this
Section 2.4, the Trustees in office, regardless of their number, shall have
all the powers granted to the Trustees and shall discharge all the duties
imposed upon the Trustees by the Declaration. A written instrument certifying
the existence of such vacancy signed by a majority of the Trustees shall be
conclusive evidence of the existence of such vacancy.
Section 2.5. Delegation of Power to Other Trustees. Any Trustee may, by
power of attorney, delegate his power for a period not exceeding six (6)
months at any one time to any other Trustee or Trustees; provided that in no
case shall less than two (2) Trustees personally exercise the powers granted
to the Trustees under the Declaration except as herein otherwise expressly
provided.
ARTICLE III
POWERS OF TRUSTEES
Section 3.1. General. The Trustees shall have exclusive and absolute
control over the Trust Property and over the business of the Trust to the
same extent as if the Trustees were the sole owners of the Trust Property and
business in their own right, but with such powers of delegation as may be
permitted by the Declaration. The Trustees shall have power to conduct the
business of the Trust and carry on its operations in any and all of its
branches and maintain offices both within and without the Commonwealth of
Massachusetts, in any and all states of the United States of America, in the
District of Columbia, and in any and all commonwealths, territories,
dependencies, colonies, possessions, agencies or instrumentalities
wheresoever in the world they may be located as they deem necessary, proper
or desirable in order to promote the interests of the Trust although such
things are not herein specifically mentioned. Any determination as to what is
in the interests of the Trust made by the Trustees in good faith shall be
conclusive. In construing the provisions of the Declaration, the presumption
shall be in favor of a grant of power to the Trustees.
4
The enumeration of any specific power herein shall not be construed as
limiting the aforesaid power. Such powers of the Trustees may be exercised
without order of or resort to any court.
Section 3.2. Investments. The Trustees shall have the power to:
(a) conduct, operate and carry on the business of an investment company;
(b) subscribe for, invest in, reinvest in, purchase or otherwise
acquire, hold, pledge, sell, assign, transfer, exchange, distribute, lend
or otherwise deal in or dispose of negotiable or nonnegotiable
instruments, obligations, evidences of indebtedness, certificates of
deposit or indebtedness, commercial paper, repurchase agreements, reverse
repurchase agreements, options, commodities, commodity futures contracts
and related options, currencies, currency futures and forward contracts,
and other securities, investment contracts and other instruments of any
kind, including, without limitation, those issued, guaranteed or
sponsored by any and all Persons including, without limitation, states,
territories and possessions of the United States, the District of
Columbia and any of the political subdivisions, agencies or
instrumentalities thereof, and by the United States Government or its
agencies or instrumentalities, foreign or international
instrumentalities, or by any bank or savings institution, or by any
corporation or organization organized under the laws of the United States
or of any state, territory or possession thereof, and of corporations or
organizations organized under foreign laws, or in "when issued" contracts
for any such securities, or retain Trust assets in cash and from time to
time change the investments of the assets of the Trust; and to exercise
any and all rights, powers and privileges of ownership or interest in
respect of any and all such investments of every kind and description,
including, without limitation, the right to consent and otherwise act
with respect thereto, with power to designate one or more persons, firms,
associations or corporations to exercise any of said rights, powers and
privileges in respect of any of said instruments; and the Trustees shall
be deemed to have the foregoing powers with respect to any additional
securities in which the Trust may invest should the Fundamental Policies
be amended.
(c) Notwithstanding any other provision of this Declaration to the
contrary, the Trustees shall have the power in their discretion without
any requirement of approval by Shareholders either to invest all or part
of the investable Trust Property, or sell all or part of the Trust
Property and invest all or part of the investable proceeds of such sale or
sales, in another investment company that is registered under the 1940
Act.
The Trustees shall not be limited to investing in obligations maturing before
the possible termination of the Trust, nor shall the Trustees be limited by
any law limiting the investments which may be made by fiduciaries.
Section 3.3. Legal Title. Legal title to all the Trust Property shall be
vested in the Trustees as joint tenants except that the Trustees shall have
power to cause legal title to any Trust Property to be held by or in the name
of one or more of the Trustees, or in the name of the Trust, or in the name
of any other Person as nominee, on such terms as the Trustees may determine,
provided that the interest of the Trust therein is appropriately protected.
The right, title and interest of the Trustees in the Trust Property shall
vest automatically in each Person who may hereafter become a Trustee. Upon
the resignation, removal or death of a Trustee he shall automatically cease
to have any right, title or interest in any of the Trust Property, and the
right, title and interest of such Trustee in the Trust Property shall vest
automatically in the remaining Trustees. Such vesting and cessation of title
shall be effective whether or not conveyancing documents have been executed
and delivered.
Section 3.4. Issuance and Repurchase of Securities. The Trustees shall
have the power to issue, sell, repurchase, redeem, retire, cancel, acquire,
hold, resell, reissue, dispose of, transfer, and otherwise
5
deal in Shares and, subject to the provisions set forth in Articles VII, VIII
and IX and Section 6.9 hereof, to apply to any such repurchase, redemption,
retirement, cancellation or acquisition of Shares any funds or property of
the Trust, whether capital or surplus or otherwise, to the full extent now or
hereafter permitted by the laws of the Commonwealth of Massachusetts
governing business corporations.
Section 3.5. Borrowing Money; Lending Trust Assets. Subject to the
Fundamental Policies, the Trustee shall have power to borrow money or
otherwise obtain credit and to secure the same by mortgaging, pledging or
otherwise subjecting as security the assets of the Trust, to endorse,
guarantee, or undertake the performance of any obligation, contract or
engagement of any other Person and to lend Trust assets.
Section 3.6. Delegation; Committees. The Trustees shall have power,
consistent with their continuing exclusive authority over the management of
the Trust and the Trust Property, to delegate from time to time to such of
their number or to officers, employees or agents of the Trust the doing of
such things and the execution of such instruments either in the name of the
Trust or the names of the Trustees or otherwise as the Trustees may deem
expedient.
Section 3.7. Collection and Payment. Subject to Section 6.9 hereof, the
Trustees shall have power to collect all property due to the Trust; to pay
all claims, including taxes, against the Trust Property; to prosecute,
defend, compromise or abandon any claims relating to the Trust Property; to
foreclose any security interest securing any obligations, by virtue of which
any property is owed to the Trust; and to enter into releases, agreements and
other instruments.
Section 3.8. Expenses. Subject to Section 6.9 hereof, the Trustees shall
have the power to incur and pay any expenses which in the opinion of the
Trustees are necessary or incidental to carry out any of the purposes of the
Declaration, and to pay reasonable compensation from the funds of the Trust
to themselves as Trustees. The Trustees shall fix the compensation of all
officers, employees and Trustees.
Section 3.9. Manner of Acting; By-Laws. Except as otherwise provided
herein or in the By-Laws or by any provision of law, any action to be taken
by the Trustees may be taken by a majority of the Trustees present at a
meeting of Trustees (a quorum being present), including any meeting held by
means of a conference telephone circuit or similar communications equipment
by means of which all persons participating in the meeting can hear each
other, or by written consents of all the Trustees. The Trustees may adopt
By-Laws not inconsistent with this Declaration to provide for the conduct of
the business of the Trust and may amend or repeal such By-Laws to the extent
such power is not reserved to the Shareholders.
Section 3.10. Miscellaneous Powers. The Trustees shall have the power to:
(a) employ or contract with such Persons as the Trustees may deem desirable
for the transaction of the business of the Trust or any Series thereof; (b)
enter into joint ventures, partnerships and any other combinations or
associations; (c) remove Trustees or fill vacancies in or add to their
number, elect and remove such officers and appoint and terminate such agents
or employees as they consider appropriate, and appoint from their own number,
and terminate, any one or more committees which may exercise some or all of
the power and authority of the Trustees as the Trustees may determine; (d)
purchase, and pay for out of Trust Property or the property of the
appropriate Series of the Trust, insurance policies insuring the
Shareholders, Trustees, officers, employees, agents, investment advisers,
distributors, selected dealers or independent contractors of the Trust
against all claims arising by reason of holding any such position or by
reason of any action taken or omitted to be taken by any such Person in such
capacity, whether or not constituting negligence, or whether or not the Trust
would have the power to indemnify such Person against such liability; (e)
establish pension, profit-sharing, Share purchase, and other retirement,
incentive and benefit
6
plans for any Trustees, officers, employees and agents of the Trust; (f) to
the extent permitted by law, indemnify any person with whom the Trust or any
Series thereof has dealings, including any Investment Adviser, Distributor,
Transfer Agent and selected dealers, to such extent as the Trustees shall
determine; (g) guarantee indebtedness or contractual obligations of others;
(h) determine and change the fiscal year of the Trust or any Series thereof
and the method by which its accounts shall be kept; and (i) adopt a seal for
the Trust but the absence of such seal shall not impair the validity of any
instrument executed on behalf of the Trust.
Section 3.11. Principal Transactions. Except in transactions permitted by
the 1940 Act or any rule or regulation thereunder, or any order of exemption
issued by the Commission, or effected to implement the provisions of any
agreement to which the Trust is a party, the Trustees shall not, on behalf of
the Trust, buy any securities (other than Shares) from or sell any securities
(other than Shares) to, or lend any assets of the Trust or any Series thereof
to, any Trustee or officer of the Trust or any firm of which any such Trustee
or officer is a member acting as principal, or have any such dealings with
any Investment Adviser, Distributor or Transfer Agent or with any Affiliated
Person of such Person; but the Trust or any Series thereof may employ any
such Person, or firm or company in which such Person is an Interested Person,
as broker, legal counsel, registrar, transfer agent, dividend disbursing
agent or custodian upon customary terms.
Section 3.12. Litigation. The Trustees shall have the power to engage in
and to prosecute, defend, compromise, abandon, or adjust, by arbitration, or
otherwise, any actions, suits, proceedings, disputes, claims, and demands
relating to the Trust, and out of the assets of the Trust or any Series
thereof to pay or to satisfy any debts, claims or expenses incurred in
connection therewith, including those of litigation, and such power shall
include without limitation the power of the Trustees or any appropriate
committee thereof, in the exercise of their or its good faith business
judgment, to dismiss any action, suit, proceeding, dispute, claim, or demand,
derivative or otherwise, brought by any person, including a Shareholder in
its own name or the name of the Trust, whether or not the Trust or any of the
Trustees may be named individually therein or the subject matter arises by
reason of business for or on behalf of the Trust.
ARTICLE IV
INVESTMENT ADVISER, DISTRIBUTOR, CUSTODIAN AND TRANSFER AGENT
Section 4.1. Investment Adviser and Manager. Subject to approval by a
Majority Shareholder Vote, the Trustees may in their discretion from time to
time enter into one or more investment advisory and management contracts or,
if the Trustees establish multiple Series, separate investment advisory and
management contracts with respect to one or more Series whereby the other
party or parties to any such contracts shall undertake to furnish the Trust
or such Series such management, investment advisory, administration,
accounting, legal, statistical and research facilities and services,
promotional or marketing activities, and such other facilities and services,
if any, as the Trustees shall from time to time consider desirable and all
upon such terms and conditions as the Trustees may in their discretion
determine. The vote of the initial shareholder(s) shall constitute "Majority
Shareholder Vote" if such agreements are entered into prior to a public
offering of Shares of the Trust. Notwithstanding any provisions of the
Declaration, the Trustees may authorize the Investment Advisers, or any of
them, under any such contracts (subject to such general or specific
instructions as the Trustees may from time to time adopt) to effect
purchases, sales, loans or exchanges of portfolio securities and other
investments of the Trust on behalf of the Trustees or may authorize any
officer, employee or Trustee to effect such purchases, sales, loans or
exchanges pursuant to recommendations of such Investment Advisers, or any of
them (and all without further action by the Trustees). Any such purchases,
sales, loans and exchanges shall be deemed
7
to have been authorized by all of the Trustees. The Trustees may, in their
sole discretion, call a meeting of Shareholders in order to submit to a vote
of Shareholders at such meeting the approval or continuance of any such
investment advisory or management contract. If the Shareholders of any one or
more of the Series of the Trust should fail to approve any such investment
advisory or management contract, the Investment Adviser may nonetheless serve
as Investment Adviser with respect to any Series whose Shareholders approve
such contract.
Section 4.2. Administrative Services. The Trustees may in their discretion
from time to time contract for administrative personnel and services whereby
the other party shall agree to provide the Trustees or the Trust
administrative personnel and services to operate the Trust on a daily or
other basis, on such terms and conditions as the Trustees may in their
discretion determine. Such services may be provided by one or more persons or
entities.
Section 4.3. Distributor. The Trustees may in their discretion from time
to time enter into one or more contracts, providing for the sale of Shares to
net the Trust or the applicable Series of the Trust not less than the net
asset value per Share (as described in Article VIII hereof) and pursuant to
which the Trust may either agree to sell the Shares to the other parties to
the contracts, or any of them, or appoint any such other party its sales
agent for such Shares. In either case, any such contract shall be on such
terms and conditions as the Trustees may in their discretion determine not
inconsistent with the provisions of this Article IV, including, without
limitation, the provision for the repurchase or sale of shares of the Trust
by such other party as principal or as agent of the Trust.
Section 4.4. Transfer Agent. The Trustees may in their discretion from
time to time enter into a transfer agency and shareholder service contract
whereby the other party to such contract shall undertake to furnish transfer
agency and shareholder services to the Trust. The contract shall have such
terms and conditions as the Trustees may in their discretion determine not
inconsistent with the Declaration. Such services may be provided by one or
more Persons.
Section 4.5. Custodian. The Trustees may appoint or otherwise engage one
or more banks or trust companies, each having an aggregate capital, surplus
and undivided profits (as shown in its last published report) of at least
five million dollars ($5,000,000) to serve as Custodian with authority as its
agent, but subject to such restrictions, limitations and other requirements,
if any, as may be contained in the By-Laws of the Trust.
Section 4.6. Parties to Contract. Any contract of the character described
in Sections 4.1, 4.2, 4.3, 4.4 or 4.5 of this Article IV and any other
contract may be entered into with any Person, although one or more of the
Trustees or officers of the Trust may be an officer, director, trustee,
shareholder, or member of such other party to the contract, and no such
contract shall be invalidated or rendered voidable by reason of the existence
of any such relationship; nor shall any Person holding such relationship be
liable merely by reason of such relationship for any loss or expense to the
Trust under or by reason of said contract or accountable for any profit
realized directly or indirectly therefrom, provided that the contract when
entered into was not inconsistent with the provisions of this Article IV. The
same Person may be the other party to any contracts entered into pursuant to
Sections 4.1, 4.2, 4.3, 4.4 or 4.5 above or otherwise, and any individual may
be financially interested or otherwise affiliated with Persons who are
parties to any or all of the contracts mentioned in this Section 4.6.
8
ARTICLE V
LIMITATIONS OF LIABILITY OF SHAREHOLDERS,
TRUSTEES AND OTHERS
Section 5.1. No Personal Liability of Shareholders, Trustees, etc. No
Shareholder shall be subject to any personal liability whatsoever to any
Person in connection with Trust Property or the acts, obligations or affairs
of the Trust. No Trustee, officer, employee or agent of the Trust shall be
subject to any personal liability whatsoever to any Person, other than the
Trust or its Shareholders, in connection with the Trust Property or the
affairs of the Trust, save only that arising from bad faith, willful
misfeasance, gross negligence or reckless disregard for his duty to such
Person; and all such Persons shall look solely to the Trust Property, or to
the Property of one or more specific Series of the Trust if the claim arises
from the conduct of such Trustee, officer, employee or agent with respect to
only such Series, for satisfaction of claims of any nature arising in
connection with the affairs of the Trust. If any Shareholder, Trustee,
officer, employee or agent, as such, of the Trust is made a party to any suit
or proceeding to enforce any such liability, he shall not, on account
thereof, be held to any personal liability. The Trust shall indemnify out of
the property of the Trust and hold each Shareholder harmless from and against
all claims and liabilities, to which such Shareholder may become subject by
reason of his being or having been a Shareholder, and shall reimburse such
Shareholder for all legal and other expenses reasonably incurred by him in
connection with any such claim or liability; provided that, in the event the
Trust shall consist of more than one Series, Shareholders of a particular
Series who are faced with claims or liabilities solely by reason of their
status as Shareholders of that Series shall be limited to the assets of that
Series for recovery of such loss and related expenses. The rights accruing to
a Shareholder under this Section 5.1 shall not exclude any other right to
which such Shareholder may be lawfully entitled, nor shall anything herein
contained restrict the right of the Trust to indemnify or reimburse a
Shareholder in any appropriate situation even though not specifically
provided herein.
Section 5.2. Non-Liability of Trustees, etc. No Trustee, officer, employee
or agent of the Trust shall be liable to the Trust, its Shareholders, or to
any Shareholder, Trustee, officer, employee, or agent thereof for any action
or failure to act (including without limitation the failure to compel in any
way any former or acting Trustee to redress any breach of trust) except for
his own bad faith, willful misfeasance, gross negligence or reckless
disregard of his duties.
Section 5.3. Indemnification. (a) The Trustees shall provide for
indemnification by the Trust, or by one or more Series thereof, if the claim
arises from his or her conduct with respect to only such Series, of any
person who is, or has been, a Trustee, officer, employee or agent of the
Trust against all liability and against all expenses reasonably incurred or
paid by him in connection with any claim, action, suit or proceeding in which
he becomes involved as a party or otherwise by virtue of his being or having
been a Trustee, officer, employee or agent and against amounts paid or
incurred by him in the settlement thereof, in such manner as the Trustees may
provide from time to time in the By-Laws.
(b) The words "claim," "action," "suit," or "proceeding" shall apply to
all claims, actions, suits or proceedings (civil, criminal, or other,
including appeals), actual or threatened; and the words "liability" and
"expenses" shall include, without limitation, attorneys' fees, costs,
judgments, amounts paid in settlement, fines, penalties and other
liabilities.
Section 5.4. No Bond Required of Trustees. No Trustee shall be obligated
to give any bond or other security for the performance of any of his duties
hereunder.
Section 5.5. No Duty of Investigation; Notice in Trust Instruments,
etc. No purchaser, lender, transfer agent or other Person dealing with the
Trustees or any officer, employee or agent of the Trust or
9
a Series thereof shall be bound to make any inquiry concerning the validity
of any transaction purporting to be made by the Trustees or by said officer,
employee or agent or be liable for the application of money or property paid,
loaned or delivered to or on the order of the Trustees or of said officer,
employee or agent. Every obligation, contract, instrument, certificate,
Share, other security of the Trust or a Series thereof or undertaking, and
every other act or thing whatsoever executed in connection with the Trust
shall be conclusively presumed to have been executed or done by the executors
thereof only in their capacity as officers, employees or agents of the Trust
or a Series thereof. Every written obligation, contract, instrument,
certificate, Share, other security of the Trust or undertaking made or issued
by the Trustees shall recite that the same is executed or made by them not
individually, but as Trustees under the Declaration, and that the obligations
of the Trust or a Series thereof under any such instrument are not binding
upon any of the Trustees or Shareholders, individually, but bind only the
Trust Estate (or, in the event the Trust shall consist of more than one
Series, in the case of any such obligation which relates to a specific
Series, only the Series which is a party thereto), and may contain any
further recital which they or he may deem appropriate, but the omission of
such recital shall not affect the validity of such obligation, contract
instrument, certificate, Share, security or undertaking and shall not operate
to bind the Trustees or Shareholders individually. The Trustees shall at all
times maintain insurance for the protection of the Trust Property, its
Shareholders, Trustees, officers, employees and agents in such amount as the
Trustees shall deem adequate to cover possible tort liability, and such other
insurance as the Trustees in their sole judgment shall deem advisable.
Section 5.6. Reliance on Experts, etc. Each Trustee and officer or
employee of the Trust shall, in the performance of his duties, be fully and
completely justified and protected with regard to any act or any failure to
act resulting from reliance in good faith upon the books of account or other
records of the Trust, upon an opinion of counsel, or upon reports made to the
Trust by any of its officers or employees or by any Investment Adviser,
Distributor, Transfer Agent, selected dealers, accountants, appraisers or
other experts or consultants selected with reasonable care by the Trustees,
officers or employees of the Trust, regardless of whether such counsel or
expert may also be a Trustee.
ARTICLE VI
SHARES OF BENEFICIAL INTEREST
Section 6.1. Beneficial Interest. The interest of the beneficiaries
hereunder shall be divided into transferable shares of beneficial interest of
$.01 par value. The number of such shares of beneficial interest authorized
hereunder is unlimited. The Trustees shall have the authority to establish
and designate one or more Series or classes of shares. Each share of any
Series shall represent an equal proportionate share in the assets of that
Series with each other Share in that Series. The Trustees may divide or
combine the shares of any Series into a greater or lesser number of shares in
that Series without thereby changing the proportionate interests in the
assets of that Series. Subject to the provisions of Section 6.9 hereof, the
Trustees may also authorize the creation of additional series of shares (the
proceeds of which may be invested in separate, independently managed
portfolios) and additional classes of shares within any series. All Shares
issued hereunder including, without limitation, Shares issued in connection
with a dividend in Shares or a split in Shares, shall be fully paid and
nonassessable.
Section 6.2. Rights of Shareholders. The ownership of the Trust Property
of every description and the right to conduct any business hereinbefore
described are vested exclusively in the Trustees, and the Shareholders shall
have no interest therein other than the beneficial interest conferred by
their Shares, and they shall have no right to call for any partition or
division of any property, profits, rights or interests of the Trust nor can
they be called upon to assume any losses of the Trust or suffer an assessment
of any
10
kind by virtue of their ownership of Shares. The Shares shall be personal
property giving only the rights in the Declaration specifically set forth.
The Shares shall not entitle the holder to preference, preemptive, appraisal,
conversion or exchange rights, except as the Trustees may determine with
respect to any series of Shares.
Section 6.3. Trust Only. It is the intention of the Trustees to create
only the relationship of Trustee and beneficiary between the Trustees and
each Shareholder from time to time. It is not the intention of the Trustees
to create a general partnership, limited partnership, joint stock
association, corporation, bailment or any form of legal relationship other
than a trust. Nothing in the Declaration shall be construed to make the
Shareholders, either by themselves or with the Trustees, partners or members
of a joint stock association.
Section 6.4. Issuance of Shares. The Trustees, in their discretion may,
from time to time without vote of the Shareholders, issue Shares of any
Series, in addition to the then issued and outstanding Shares and Shares held
in the treasury, to such party or parties and for such amount and type of
consideration, including cash or property, at such time or times and on such
terms as the Trustees may deem best, and may in such manner acquire other
assets (including the acquisition of assets subject to, and in connection
with the assumption of liabilities) and businesses. In connection with any
issuance of Shares, the Trustees may issue fractional Shares. The Trustees
may from time to time divide or combine the Shares of any Series into a
greater or lesser number without thereby changing the proportionate
beneficial interests in that Series. Contributions to the Trust may be
accepted for, and Shares shall be redeemed as, whole Shares and/or fractions
of a Share as described in the Prospectus.
Section 6.5. Register of Shares. A register shall be kept in respect of
each Series at the principal office of the Trust or at an office of the
Transfer Agent which shall contain the names and addresses of the
Shareholders and the number of Shares of each Series held by them
respectively and a record of all transfers thereof. Such register may be in
written form or any other form capable of being converted into written form
within a reasonable time for visual inspection. Such register shall be
conclusive as to who are the holders of the Shares and who shall be entitled
to receive dividends or distributions or otherwise to exercise or enjoy the
rights of Shareholders. No Shareholder shall be entitled to receive payment
of any dividend or distribution, nor to have notice given to him as herein or
in the By-Laws provided, until he has given his address to the Transfer Agent
or such other officer or agent of the Trustees as shall keep the said
register for entry thereon. It is not contemplated that certificates will be
issued for the Shares; however, the Trustees, in their discretion, may
authorize the issuance of Share certificates and promulgate appropriate rules
and regulations as to their use.
Section 6.6. Transfer of Shares. Shares shall be transferable on the
records of the Trust only by the record holder or by his agent thereunto duly
authorized in writing, upon delivery to the Trustees or the Transfer Agent of
a duly executed instrument of transfer, together with such evidence of the
genuineness of each such execution and authorization and of other matters as
may reasonably be required. Upon such delivery the transfer shall be recorded
on the register of the Trust. Until such record is made, the Shareholder of
record shall be deemed to be the holder of such Shares for all purposes
hereunder and neither the Trustees nor any Transfer Agent or registrar nor
any officer, employee or agent of the Trust shall be affected by any notice
of the proposed transfer.
Any person becoming entitled to any Shares in consequence of the death,
bankruptcy, or incompetence of any Shareholder, or otherwise by operation of
law, shall be recorded on the register of Shares as the holder of such Shares
upon production of the proper evidence thereof to the Trustees or the
Transfer Agent, but until such record is made, the Shareholder of record
shall be deemed to be the holder
11
of such Shares for all purposes hereunder and neither the Trustees nor any
Transfer Agent or registrar nor any officer or agent of the Trust shall be
affected by any notice of such death, bankruptcy or incompetence, or other
operation of law, except as may otherwise be provided by the laws of the
Commonwealth of Massachusetts.
Section 6.7. Notices. Any and all notices to which any Shareholder may be
entitled and any and all communications shall be deemed duly served or given
if mailed, postage prepaid, addressed to any Shareholder of record at his
last known address as recorded on the register of the Trust. Annual reports
and proxy statements need not be sent to a Shareholder if: (i) an annual
report and proxy statement for two consecutive annual meetings, or (ii) all,
and at least two, checks (if sent by first class mail) in payment of
dividends or interest and shares during a twelve month period have been
mailed to such Shareholder's address and have been returned undelivered.
However, delivery of such annual reports and proxy statements shall resume
once a Shareholder's current address is determined.
Section 6.8. Voting Powers. The Shareholders shall have power to vote only
(i) for the election of Trustees as provided in Section 2.2 hereof, (ii) for
the removal of Trustees as provided in Section 2.3 hereof, (iii) with respect
to any investment advisory or management contract as provided in Section 4.1,
(iv) with respect to termination of the Trust as provided in Section 9.2, (v)
with respect to any amendment of the Declaration to the extent and as
provided in Section 9.3, (vi) with respect to any merger, consolidation or
sale of assets as provided in Section 9.4, (vii) with respect to
incorporation of the Trust to the extent and as provided in Section 9.5,
(viii) to the same extent as the stockholders of a Massachusetts business
corporation as to whether or not a court action, proceeding or claim should
or should not be brought or maintained derivatively or as a class action on
behalf of the Trust or the Shareholders (provided that Shareholders of a
Series are not entitled to vote in connection with the bringing of a
derivative or class action with respect to any matter which only affects
another Series or its Shareholders), (ix) with respect to any plan adopted
pursuant to Rule 12b-1 (or any successor rule) under the 1940 Act and (x)
with respect to such additional matters relating to the Trust as may be
required by law, the Declaration, the By-Laws or any registration of the
Trust with the Commission (or any successor agency) or any state, or as and
when the Trustees may consider necessary or desirable. Each whole Share shall
be entitled to one vote as to any matter on which it is entitled to vote and
each fractional Share shall be entitled to a proportionate fractional vote,
except that Shares held in the treasury of the Trust as of the record date,
as determined in accordance with the By-Laws, shall not be voted. On any
matter submitted to a vote of Shareholders, all Shares shall be voted by
individual Series except (1) when required by the 1940 Act, Shares shall be
voted in the aggregate and not by individual Series; and (2) when the
Trustees have determined that the matter affects only the interests of one or
more Series, then only the Shareholders of such Series shall be entitled to
vote thereon. The Trustees may, in conjunction with the establishment of any
further Series or any classes of Shares, establish conditions under which the
several series or classes of Shares shall have separate voting rights or no
voting rights. There shall be no cumulative voting in the election of
Trustees. Until Shares are issued, the Trustees may exercise all rights of
Shareholders and may take any action required by law, the Declaration or the
By-Laws to be taken by Shareholders. The By-Laws may include further
provisions for Shareholders' votes and meetings and related matters.
Section 6.9. Series or Classes of Shares. The following provisions are
applicable regarding the Series of Shares of the Trust established in Section
6.1 hereof and shall be applicable if the Trustees shall establish additional
Series or shall divide the shares of any Series into two or more classes,
also as provided in Section 6.1 hereof, and all provisions relating to the
Trust shall apply equally to each Series thereof except as the context
requires:
12
(a) The number of authorized shares and the number of shares of each
Series or of each class that may be issued shall be unlimited. The
Trustees may classify or reclassify any unissued shares or any shares
previously issued and reacquired of any Series or class into one or more
Series or one or more classes that may be established and designated from
time to time. The Trustees may hold as treasury shares (of the same or
some other Series or class), reissue for such consideration and on such
terms as they may determine, or cancel any shares of any Series or any
class reacquired by the Trust at their discretion from time to time.
(b) The power of the Trustees to invest and reinvest the Trust Property
shall be governed by Section 3.2 of this Declaration with respect to any
one or more Series which represents the interests in the assets of the
Trust immediately prior to the establishment of any additional Series and
the power of the Trustees to invest and reinvest assets applicable to any
other Series shall be as set forth in the instrument of the Trustees
establishing such series which is hereinafter described.
(c) All consideration received by the Trust for the issue or sale of
shares of a particular Series or class together with all assets in which
such consideration is invested or reinvested, all income, earnings,
profits, and proceeds thereof, including any proceeds derived from the
sale, exchange or liquidation of such assets, and any funds or payments
derived from any reinvestment of such proceeds in whatever form the same
may be, shall irrevocably belong to that Series or class for all
purposes, subject only to the rights of creditors, and shall be so
recorded upon the books of account of the Trust. In the event that there
are any assets, income, earnings, profits, and proceeds thereof, funds,
or payments which are not readily identifiable as belonging to any
particular Series or class, the Trustees shall allocate them among any
one or more of the Series or classes established and designated from time
to time in such manner and on such basis as they, in their sole
discretion, deem fair and equitable. Each such allocation by the Trustees
shall be conclusive and binding upon the shareholders of all Series or
classes for all purposes. No holder of Shares of any Series shall have
any claim on or right to any assets allocated or belonging to any other
Series.
(d) The assets belonging to each particular Series shall be charged with
the liabilities of the Trust in respect of that Series and all expenses,
costs, charges and reserves attributable to that Series. All expenses and
liabilities incurred or arising in connection with a particular Series,
or in connection with the management thereof, shall be payable solely out
of the assets of that Series and creditors of a particular Series shall
be entitled to look solely to the property of such Series for
satisfaction of their claims. Any general liabilities, expenses, costs,
charges or reserves of the Trust which are not readily identifiable as
belonging to any particular Series shall be allocated and charged by the
Trustees to and among any one or more of the series established and
designated from time to time in such manner and on such basis as the
Trustees in their sole discretion deem fair and equitable. Each
allocation of liabilities, expenses, costs, charges and reserves by the
Trustees shall be conclusive and binding upon the holders of all Series
for all purposes. The Trustees shall have full discretion, to the extent
not inconsistent with the 1940 Act, to determine which items shall be
treated as income and which items as capital; and each such determination
and allocation shall be conclusive and binding upon the Shareholders.
(e) The power of the Trustees to pay dividends and make distributions
shall be governed by Section 8.2 of this Declaration with respect to any
one or more Series or classes which represents the interests in the
assets of the Trust immediately prior to the establishment of any
additional Series or classes. With respect to any other Series or class,
dividends and distributions on shares of a particular Series or class may
be paid with such frequency as the Trustees may determine, which may be
daily or otherwise, pursuant to a standing resolution or resolutions
adopted only once or with such
13
frequency as the Trustees may determine, to the holders of shares of that
Series or class, from such of the income and capital gains, accrued or
realized, from the assets belonging to that Series or class, as the
Trustees may determine, after providing for actual and accrued
liabilities belonging to that Series or class. All dividends and
distributions on shares of a particular Series or class shall be
distributed pro rata to the holders of that Series or class in proportion
to the number of shares of that Series or class held by such holders at
the date and time of record established for the payment of such dividends
or distributions.
(f) The Trustees shall have the power to determine the designations,
preferences, privileges, limitations and rights, including voting and
dividend rights, of each class and Series of Shares.
(g) Subject to compliance with the requirements of the 1940 Act, the
Trustees shall have the authority to provide that the holders of Shares
of any Series or class shall have the right to convert or exchange said
Shares into Shares of one or more Series of Shares in accordance with
such requirements and procedures as may be established by the Trustees.
(h) The establishment and designation of any Series or class of shares
in addition to those established in Section 6.1 hereof shall be effective
upon the execution by a majority of the then Trustees of an instrument
setting forth such establishment and designation and the relative rights,
preferences, voting powers, restrictions, limitations as to dividends,
qualifications, and terms and conditions of redemption of such Series or
class, or as otherwise provided in such instrument. At any time that
there are no shares outstanding of any particular Series or class
previously established and designated, the Trustees may by an instrument
executed by a majority of their number abolish that Series or class and
the establishment and designation thereof. Each instrument referred to in
this paragraph shall have the status of an amendment to this Declaration.
(i) Shareholders of a Series shall not be entitled to participate in a
derivative or class action with respect to any matter which only affects
another Series or its Shareholders.
(j) Each Share of a Series of the Trust shall represent a beneficial
interest in the net assets of such Series. Each holder of Shares of a
Series shall be entitled to receive his pro-rata share of distributions
of income and capital gains made with respect to such Series. In the
event of the liquidation of a particular Series, the Shareholders of that
Series which has been established and designated and which is being
liquidated shall be entitled to receive, when and as declared by the
Trustees, the excess of the assets belonging to that Series over the
liabilities belonging to that Series. The holders of Shares of any Series
shall not be entitled hereby to any distribution upon liquidation of any
other Series. The assets so distributable to the Shareholders of any
Series shall be distributed among such Shareholders in proportion to the
number of Shares of that Series held by them and recorded on the books of
the Trust. The liquidation of any particular Series in which there are
Shares then outstanding may be authorized by an instrument in writing,
without a meeting, signed by a majority of the Trustees then in office,
subject to the approval of a majority of the outstanding voting
securities of that Series, as that phrase is defined in the 1940 Act.
ARTICLE VII
REDEMPTIONS
Section 7.1. Redemptions. Each Shareholder of a particular Series shall
have the right at such times as may be permitted by the Trust to require the
Trust to redeem all or any part of his Shares of that Series, upon and
subject to the terms and conditions provided in this Article VII. The Trust
shall, upon application of any Shareholder or pursuant to authorization from
any Shareholder, redeem or repurchase
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from such Shareholder outstanding shares for an amount per share determined
by the Trustees in accordance with any applicable laws and regulations;
provided that (a) such amount per share shall not exceed the cash equivalent
of the proportionate interest of each share or of any class or Series of
shares in the assets of the Trust at the time of the redemption or repurchase
and (b) if so authorized by the Trustees, the Trust may, at any time and from
time to time charge fees for effecting such redemption or repurchase, at such
rates as the Trustees may establish, as and to the extent permitted under the
1940 Act and the rules and regulations promulgated thereunder, and may, at
any time and from time to time, pursuant to such Act and such rules and
regulations, suspend such right of redemption. The procedures for effecting
and suspending redemption shall be as set forth in the Prospectus from time
to time. Payment will be made in such manner as described in the Prospectus.
Section 7.2. Redemption at the Option of the Trust. Each Share of the
Trust or any Series of the Trust shall be subject to redemption at the option
of the Trust at the redemption price which would be applicable if such Share
were then being redeemed by the Shareholder pursuant to Section 7.1: (i) at
any time, if the Trustees determine in their sole discretion that failure to
so redeem may have materially adverse consequences to the holders of the
Shares of the Trust or of any Series, or (ii) upon such other conditions with
respect to maintenance of Shareholder accounts of a minimum amount as may
from time to time be determined by the Trustees and set forth in the then
current Prospectus of the Trust. Upon such redemption the holders of the
Shares so redeemed shall have no further right with respect thereto other
than to receive payment of such redemption price.
Section 7.3. Effect of Suspension of Determination of Net Asset Value. If,
pursuant to Section 7.4 hereof, the Trustees shall declare a suspension of
the determination of net asset value with respect to Shares of the Trust or
of any Series thereof, the rights of Shareholders (including those who shall
have applied for redemption pursuant to Section 7.1 hereof but who shall not
yet have received payment) to have Shares redeemed and paid for by the Trust
or a Series thereof shall be suspended until the termination of such
suspension is declared. Any record holder who shall have his redemption right
so suspended may, during the period of such suspension, by appropriate
written notice of revocation at the office or agency where application was
made, revoke any application for redemption not honored and withdraw any
certificates on deposit. The redemption price of Shares for which redemption
applications have not been revoked shall be the net asset value of such
Shares next determined as set forth in Section 8.1 after the termination of
such suspension, and payment shall be made within seven (7) days after the
date upon which the application was made plus the period after such
application during which the determination of net asset value was suspended.
Section 7.4. Suspension of Right of Redemption. The Trust may declare a
suspension of the right of redemption or postpone the date of payment or
redemption for the whole or any part of any period (i) during which the New
York Stock Exchange is closed other than for customary weekend and holiday
closings, (ii) during which trading on the New York Stock Exchange is
restricted, (iii) during which an emergency exists as a result of which
disposal by the Trust or a Series thereof of securities owned by it is not
reasonably practicable or it is not reasonably practicable for the Trust or a
Series thereof fairly to determine the value of its net assets, or (iv)
during any other period when the Commission may for the protection of
security holders of the Trust by order permit suspension of the rights of
redemption or postponement of the date of payment or redemption; provided
that applicable rules and regulations of the Commission shall govern as to
whether the conditions prescribed in (ii), (iii) or (iv) exist. Such
suspension shall take effect at such time as the Trust shall specify but not
later than the close of business on the business day next following the
declaration of suspension, and thereafter there shall be no right of
redemption or payment on redemption until the Trust shall declare the
suspension at an end, except that
15
the suspension shall terminate in any event on the first day on which said
stock exchange shall have reopened or the period specified in (ii) or (iii)
shall have expired (as to which in the absence of an official ruling by the
Commission, the determination of the Trust shall be conclusive). In the case
of a suspension of the right of redemption, a Shareholder may either withdraw
his request for redemption or receive payment based on the net asset value
existing after the termination of the suspension.
ARTICLE VIII
DETERMINATION OF NET ASSET VALUE,
NET INCOME AND DISTRIBUTIONS
Section 8.1. Net Asset Value. The net asset value of each outstanding
Share of each Series of the Trust shall be determined on such days and at
such time or times as the Trustees may determine. The method of determination
of net asset value shall be determined by the Trustees and shall be as set
forth in the Prospectus. The power and duty to make the daily calculations
may be delegated by the Trustees to any Investment Adviser, the Custodian,
the Transfer Agent or such other person as the Trustees by resolution may
determine. The Trustees may suspend the daily determination of net asset
value to the extent permitted by the 1940 Act.
Section 8.2. Distributions to Shareholders. The Trustees shall from time
to time distribute ratably among the Shareholders of the Trust or of any
Series such proportion of the net income, earnings, profits, gains, surplus
(including paid-in surplus), capital, or assets of the Trust or of such
Series held by the Trustees as they may deem proper. Such distribution may be
made in cash or property (including without limitation any type of
obligations of the Trust or of such Series or any assets thereof), and the
Trustees may distribute ratably among the Shareholders of the Trust or of
that Series additional Shares issuable hereunder in such manner, at such
times, and on such terms as the Trustees may deem proper. Such distributions
may be among the Shareholders of record (determined in accordance with the
Prospectus) of the Trust or of such Series at the time of declaring a
distribution or among the Shareholders of record of the Trust or of such
Series at such later date as the Trustees shall determine. The Trustees may
always retain from the net income, earnings, profits or gains of the Trust or
of such Series such amount as they may deem necessary to pay the debts or
expenses of the Trust or of such Series or to meet obligations of the Trust
or of such Series, or as they may deem desirable to use in the conduct of its
affairs or to retain for future requirements or extensions of the business.
The Trustees may adopt and offer to Shareholders of the Trust or of any
Series such dividend reinvestment plans, cash dividend payout plans or
related plans as the Trustees deem appropriate.
Inasmuch as the computation of net income and gains for Federal income tax
purposes may vary from the computation thereof on the books, the above
provisions shall be interpreted to give the Trustees the power in their
discretion to distribute for any fiscal year as ordinary dividends and as
capital gains distributions, respectively, additional amounts sufficient to
enable the Trust to avoid or reduce liability for taxes.
Section 8.3. Determination of Net Income. The Trustees shall have the
power to determine the net income of any Series of the Trust and from time to
time to distribute such net income ratably among the Shareholders as
dividends in cash or additional Shares of such Series issuable hereunder. The
determination of net income and the resultant declaration of dividends shall
be as set forth in the Prospectus. The Trustees shall have full discretion to
determine whether any cash or property received by any Series of the Trust
shall be treated as income or as principal and whether any item of expense
shall be charged to the income or the principal account, and their
determination made in good faith shall be conclusive upon the Shareholders.
In the case of stock dividends received, the Trustees shall have full
16
discretion to determine, in the light of the particular circumstances, how
much, if any, of the value thereof shall be treated as income, the balance,
if any, to be treated as principal.
Section 8.4. Power to Modify Foregoing Procedures. Notwithstanding any of
the foregoing provisions of this Article VIII, the Trustees may prescribe, in
their absolute discretion, such other bases and times for determining the per
Share net asset value of the Shares or net income, or the declaration and
payment of dividends and distributions, as they may deem necessary or
desirable to enable the Trust to comply with any provision of the 1940 Act,
or any rule or regulation thereunder, including any rule or regulation
adopted pursuant to Section 22 of the 1940 Act by the Commission or any
securities association registered under the Securities Exchange Act of 1934,
or any order of exemption issued by said Commission, all as in effect now or
hereafter amended or modified. Without limiting the generality of the
foregoing, the Trustees may establish classes or additional Series of Shares
in accordance with Section 6.9.
ARTICLE IX
DURATION; TERMINATION OF TRUST; AMENDMENT; MERGERS, ETC.
Section 9.1. Duration. The Trust shall continue without limitation of time
but subject to the provisions of this Article IX.
Section 9.2. Termination of Trust. (a) The Trust or any Series may be
terminated (i) by a Majority Shareholder Vote at any meeting of Shareholders
of the Trust or the appropriate Series thereof, (ii) by an instrument in
writing, without a meeting, signed by a majority of the Trustees and
consented to by a Majority Shareholder Vote of the Trust or the appropriate
Series thereof, or by such other vote as may be established by the Trustees
with respect to any class or Series of Shares, or (iii) with respect to a
Series as provided in Section 6.9(h). Upon the termination of the Trust or
the Series:
(i) The Trust or the Series shall carry on no business except for the
purpose of winding up its affairs.
(ii) The Trustees shall proceed to wind up the affairs of the Trust or
the Series and all of the powers of the Trustees under this Declaration
shall continue until the affairs of the Trust shall have been wound up,
including the power to fulfill or discharge the contracts of the Trust or
the Series, collect its assets, sell, convey, assign, exchange, transfer
or otherwise dispose of all or any part of the remaining Trust Property
or Trust Property allocated or belonging to such Series to one or more
persons at public or private sale for consideration which may consist in
whole or in part of cash, securities or other property of any kind,
discharge or pay its liabilities, and to do all other acts appropriate to
liquidate its business; provided that any sale, conveyance, assignment,
exchange, transfer or other disposition of all or substantially all the
Trust Property or Trust Property allocated or belonging to such Series
shall require Shareholder approval in accordance with Section 9.4 hereof.
(iii) After paying or adequately providing for the payment of all
liabilities, and upon receipt of such releases, indemnities and refunding
agreements, as they deem necessary for their protection, the Trustees may
distribute the remaining Trust Property or Trust Property allocated or
belonging to such Series, in cash or in kind or partly each, among the
Shareholders of the Trust according to their respective rights.
Section 9.3. Amendment Procedure. (a) This Declaration may be amended by a
Majority Shareholder Vote, at a meeting of Shareholders, or by written
consent without a meeting. The Trustees may also amend this Declaration
without the vote or consent of Shareholders (i) to change the name of
17
the Trust or any Series or classes of Shares, (ii) to supply any omission, or
cure, correct or supplement any ambiguous, defective or inconsistent
provision hereof, (iii) if they deem it necessary to conform this Declaration
to the requirements of applicable federal or state laws or regulations or the
requirements of the Internal Revenue Code, or to eliminate or reduce any
federal, state or local taxes which are or may be payable by the Trust or the
Shareholders, but the Trustees shall not be liable for failing to do so, or
(iv) for any other purpose which does not adversely affect the rights of any
Shareholder with respect to which the amendment is or purports to be
applicable.
(b) No amendment may be made under this Section 9.3 which would change any
rights with respect to any Shares of the Trust or of any Series of the Trust
by reducing the amount payable thereon upon liquidation of the Trust or of
such Series of the Trust or by diminishing or eliminating any voting rights
pertaining thereto, except with the vote or consent of the holders of
two-thirds of the Shares of the Trust or of such Series outstanding and
entitled to vote, or by such other vote as may be established by the Trustees
with respect to any Series or class of Shares. Nothing contained in this
Declaration shall permit the amendment of this Declaration to impair the
exemption from personal liability of the Shareholders, Trustees, officers,
employees and agents of the Trust or to permit assessments upon Shareholders.
(c) A certificate signed by a majority of the Trustees or by the Secretary
or any Assistant Secretary of the Trust, setting forth an amendment and
reciting that it was duly adopted by the Shareholders or by the Trustees as
aforesaid or a copy of the Declaration, as amended, and executed by a
majority of the Trustees or certified by the Secretary or any Assistant
Secretary of the Trust, shall be conclusive evidence of such amendment when
lodged among the records of the Trust. Unless such amendment or such
certificate sets forth some later time for the effectiveness of such
amendment, such amendment shall be effective when lodged among the records of
the Trust.
Notwithstanding any other provision hereof, until such time as a
Registration Statement under the Securities Act of 1933, as amended, covering
the first public offering of securities of the Trust shall have become
effective, this Declaration may be terminated or amended in any respect by
the affirmative vote of a majority of the Trustees or by an instrument signed
by a majority of the Trustees.
Section 9.4. Merger, Consolidation and Sale of Assets. The Trust or any
Series thereof may merge or consolidate with any other corporation,
association, trust or other organization or may sell, lease or exchange all
or substantially all of the Trust Property or Trust Property allocated or
belonging to such Series, including its good will, upon such terms and
conditions and for such consideration when and as authorized, at any meeting
of Shareholders called for the purpose, by the affirmative vote of the
holders of not less than two-thirds of the Shares of the Trust or such Series
outstanding and entitled to vote, or by an instrument or instruments in
writing without a meeting, consented to by the holders of not less than
two-thirds of such Shares, or by such other vote as may be established by the
Trustees with respect to any series or class of Shares; provided, however,
that, if such merger, consolidation, sale, lease or exchange is recommended
by the Trustees, a Majority Shareholder Vote shall be sufficient
authorization; and any such merger, consolidation, sale, lease or exchange
shall be deemed for all purposes to have been accomplished under and pursuant
to the laws of the Commonwealth of Massachusetts. Nothing contained herein
shall be construed as requiring approval of Shareholders for (a) any sale of
assets in the ordinary course of business for the Trust or any Series or
class of Shares or (b) any transaction described in Section 3.2(c) hereof.
Section 9.5. Incorporation. With approval of a Majority Shareholder Vote,
or by such other vote as may be established by the Trustees with respect to
any Series or class of Shares, the Trustees may cause to be organized or
assist in organizing a corporation or corporations under the laws of any
jurisdiction or
18
any other trust, partnership, association or other organization to take over
all of the Trust Property or the Trust Property allocated or belonging to
such Series or to carry on any business in which the Trust shall directly or
indirectly have any interest, and to sell, convey and transfer the Trust
Property or the Trust Property allocated or belonging to such Series to any
such corporation, trust, partnership, association or organization in exchange
for the shares or securities thereof or otherwise, and to lend money to,
subscribe for the shares or securities of, and enter into any contracts with
any such corporation, trust, partnership, association or organization in
which the Trust or such Series holds or is about to acquire shares or any
other interest. The Trustees may also cause a merger or consolidation between
the Trust or any successor thereto and any such corporation, trust,
partnership, association or other organization if and to the extent permitted
by law, as provided under the law then in effect. Nothing contained herein
shall be construed as requiring approval of Shareholders for (a) the Trustees
to organize or assist in organizing one or more corporations, trusts,
partnerships, associations or other organizations and selling, conveying or
transferring a portion of the Trust Property to such organization or entities
or (b) any transaction described in Section 3.2(c) hereof.
ARTICLE X
REPORTS TO SHAREHOLDERS
The Trustees shall at least semi-annually submit or cause the officers of
the Trust to submit to the Shareholders a written financial report of each
Series of the Trust, including financial statements which shall at least
annually be certified by independent public accountants.
ARTICLE XI
MISCELLANEOUS
Section 11.1. Filing. This Declaration and any amendment hereto shall be
filed in the office of the Secretary of the Commonwealth of Massachusetts and
in such other places as may be required under the laws of Massachusetts and
may also be filed or recorded in such other places as the Trustees deem
appropriate. Each amendment so filed shall be accompanied by a certificate
signed and acknowledged by a Trustee or by the Secretary or any Assistant
Secretary of the Trust stating that such action was duly taken in a manner
provided herein. A restated Declaration, integrating into a single instrument
all of the provisions of the Declaration which are then in effect and
operative, may be executed from time to time by a majority of the Trustees
and shall, upon filing with the Secretary of the Commonwealth of
Massachusetts, be conclusive evidence of all amendments contained therein and
may thereafter be referred to in lieu of the original Declaration and the
various amendments thereto.
Section 11.2. Resident Agent. The Prentice-Hall Corporation System, Inc.,
84 State Street, Boston, Massachusetts 02109 is the resident agent of the
Trust in the Commonwealth of Massachusetts.
Section 11.3. Governing Law. This Declaration is executed by the Trustees
and delivered in the Commonwealth of Massachusetts and with reference to the
laws thereof and the rights of all parties and the validity and construction
of every provision hereof shall be subject to and construed according to the
laws of said State.
Section 11.4. Counterparts. The Declaration may be simultaneously executed
in several counterparts, each of which shall be deemed to be an original, and
such counterparts, together, shall constitute one and the same instrument,
which shall be sufficiently evidenced by any such original counterpart.
Section 11.5. Reliance by Third Parties. Any certificate executed by an
individual who, according to the records of the Trust, appears to be a
Trustee hereunder, or Secretary or Assistant Secretary of the
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Trust, certifying to: (a) the number or identity of Trustees or Shareholders,
(b) the due authorization of the execution of any instrument or writing, (c)
the form of any vote passed at a meeting of Trustees or Shareholders, (d) the
fact that the number of Trustees or Shareholders present at any meeting or
executing any written instrument satisfies the requirements of this
Declaration, (e) the form of any By-Laws adopted by or the identity of any
officers elected by the Trustees, or (f) the existence of any fact or facts
which in any manner relate to the affairs of the Trust, shall be conclusive
evidence as to the matters so certified in favor of any Person dealing with
the Trustees and their successors.
Section 11.6. Provisions in Conflict with Law or Regulations. (a) The
provisions of the Declaration are severable, and if the Trustees shall
determine, with the advice of counsel, that any of such provisions is in
conflict with the 1940 Act, the regulated investment company provisions of
the Internal Revenue Code or with other applicable laws and regulations, the
conflicting provisions shall be deemed superseded by such law or regulation
to the extent necessary to eliminate such conflict; provided, however, that
such determination shall not affect any of the remaining provisions of the
Declaration or render invalid or improper any action taken or omitted prior
to such determination.
(b) If any provision of the Declaration shall be held invalid or
unenforceable in any jurisdiction, such invalidity or unenforceability shall
pertain only to such provision in such jurisdiction and shall not in any
manner affect such provision in any other jurisdiction or any other provision
of the Declaration in any jurisdiction.
Section 11.7. Use of the name "TCW/DW." Dean Witter, Discover & Co.
("DWDC") and the TCW Group Inc. and Trust Company of the West ("TCW") have
consented to the use by the Trust of the identifying name "TCW/DW," which is
a property right of DWDC and TCW. The Trust will only use the name "TCW/DW"
as a component of its name and for no other purpose, and will not purport to
grant to any third party the right to use the name "TCW/DW" for any purpose.
DWDC or TCW, or any corporate affiliate of the parent of either, may use or
grant to others the right to use the name "TCW/DW," or any combination or
abbreviation thereof, as all or a portion of a corporate or business name or
for any commercial purpose, including a grant of such right to any other
investment company. At the request of DWDC or TCW or their respective parents
or affiliates, the Trust will take such action as may be required to provide
its consent to the use by DWDC or TCW or their respective parents or
affiliates, or any corporate affiliate of such parents or affiliates, or by
any person to whom DWDC or TCW or their respective parents or affiliates,
shall have granted the right to the use of the name "TCW/DW," or any
combination or abbreviation thereof. Upon the termination of (i) any
management agreement into which DWDC and the Trust may enter, (ii) any
investment advisory agreement into which TCW and the Fund may enter, or (iii)
the alliance agreement between DWDC and TCW under which DWDC and TCW, or
affiliates of either, have agreed to provide their respective services
pursuant to contracts with the Trust, the Trust shall, upon request by DWDC
or TCW or their respective parents or affiliates, cease to use the name
"TCW/DW" as a component of its name, and shall not use the name, or any
combination or abbreviation thereof, as a part of its name or for any other
commercial purpose, and shall cause its officers, trustees and shareholders
to take any and all actions which DWDC or TCW or their respective parents or
affiliates, may request to effect the foregoing and to reconvey to DWDC or
TCW or their respective parents or affiliates, any and all rights to such
name.
Section 11.8. Principal Place of Business. The principal place of business
of the Trust shall be Two World Trade Center, New York, New York 10048, or
such other location as the Trustees may designate from time to time.
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IN WITNESS WHEREOF, the undersigned have executed this Declaration of
Trust this day of , 1997.
------------------------------ ------------------------------------
Charles A. Fiumefreddo, as Robert S. Giambrone, as
Trustee and not individually Trustee and not individually
Two World Trade Center Two World Trade Center
New York, New York 10048 New York, New York 10048
- -------------------------------
Barry Fink, as Trustee
and not individually
Two World Trade Center
New York, New York 10048
STATE OF NEW YORK
} ss.:
COUNTY OF NEW YORK
On this day of , 1997, ROBERT S. GIAMBRONE, CHARLES A.
FIUMEFREDDO and BARRY FINK, known to me and known to be the individuals
described in and who executed the foregoing instrument, personally appeared
before me and they severally acknowledged the foregoing instrument to be
their free act and deed.
---------------------------------
Notary Public
My commission expires: , 199
--------------
21
IN WITNESS WHEREOF, the undersigned has executed this instrument this
day of , 1997.
---------------------------------
Joseph F. Mazzella, at Trustee
and not individually
101 Federal Street
Boston, MA 02110
COMMONWEALTH OF MASSACHUSETTS
Suffolk, SS. Boston, MA
, 1997
Then personally appeared before me the above-named Joseph F. Mazzella who
acknowledged the foregoing instrument to be his free act and deed.
---------------------------------
Notary Public
My commission expires: , 1999
--------------
22
EXHIBIT B
FORM OF NEW INVESTMENT ADVISORY AGREEMENT
AGREEMENT made as of the day of , 1997, by and between TCW/DW
Emerging Markets Opportunities Trust, an unincorporated business trust
organized under the laws of the Commonwealth of Massachusetts (hereinafter
called the "Fund"), and TCW Funds Management Inc., a California corporation
(hereinafter called the "Investment Adviser"):
WHEREAS, The Fund is engaged in business as an open-end management
investment company and is registered as such under the Investment Company Act
of 1940, as amended (the "Act"); and
WHEREAS, The Investment Adviser is registered as an investment adviser
under the Investment Advisers Act of 1940 (the "Advisers Act"), and engages
in the business of acting as investment adviser; and
WHEREAS, The Fund desires to retain the Investment Adviser to render
investment advisory services in the manner and on the terms and conditions
hereinafter set forth; and
WHEREAS, The Investment Adviser desires to be retained to perform services
on said terms and conditions;
Now, Therefore, this Agreement
W I T N E S S E T H:
that in consideration of the premises and the mutual covenants hereinafter
contained, the Fund and the Investment Adviser agree as follows:
1. The Fund hereby retains the Investment Adviser to act as investment
adviser of the Fund and, subject to the supervision of the Trustees of the
Fund (the "Trustees"), to invest the Fund's assets as hereinafter set forth.
Without limiting the generality of the foregoing, the Investment Adviser
shall obtain and evaluate such information and advice relating to the
economy, securities and commodities markets and securities and commodities as
it deems necessary or useful to discharge its duties hereunder; shall
continuously invest the assets of the Fund in a manner consistent with the
investment objectives and policies of the Fund; shall determine the
securities and commodities to be purchased, sold or otherwise disposed of by
the Fund and the timing of such purchases, sales and dispositions; and shall
take such further action, including the placing of purchase and sale orders
on behalf of the Fund, as the Investment Adviser shall deem necessary or
appropriate. The Investment Adviser shall also furnish to or place at the
disposal of the Fund such of the information, evaluations, analyses and
opinions formulated or obtained by the Investment Adviser in the discharge of
its duties as the Fund may, from time to time, reasonably request.
2. The Investment Adviser may, at its own expense, enter into Sub-Advisory
Agreements with Sub-Advisors to make determinations as to the securities and
commodities to be purchased, sold or otherwise disposed of by the Fund and
the timing of such purchases, sales and dispositions and to take such further
action, including the placing of purchase and sale orders on behalf of the
Fund, as the Sub-Advisors, in consultation with the Investment Adviser, shall
deem necessary or appropriate; provided that the Investment Adviser shall be
responsible for monitoring compliance by such Sub-Advisors with the
investment policies and restrictions of the Fund and with such other
limitations or directions as the Trustees of the Fund may from time to time
prescribe.
1
3. The Investment Adviser shall, at its own expense, maintain such staff
and employ or retain such personnel and consult with such other persons as it
shall from time to time determine to be necessary or useful to the
performance of its obligations under this Agreement. Without limiting the
generality of the foregoing, the staff and personnel of the Investment
Adviser shall be deemed to include persons employed or otherwise retained by
the Investment Adviser to furnish statistical and other factual data, advice
regarding economic factors and trends, information with respect to technical
and scientific developments, and such other information, advice and
assistance as the Investment Adviser may desire. The Investment Adviser shall
provide the Fund's manager with such records and information as may
reasonably be required by the Fund's manager pursuant to its obligations
under its management agreement with the Fund to maintain the Fund's books and
records.
4. The Fund will, from time to time, furnish or otherwise make available
to the Investment Adviser such financial reports, proxy statements and other
information relating to the business and affairs of the Fund as the
Investment Adviser may reasonably require in order to discharge its duties
and obligations hereunder.
5. The Investment Adviser shall bear the cost of rendering the investment
advisory services to be performed by it under this Agreement, and shall, at
its own expense, pay the compensation of its directors, officers and
employees, if any, who are also Trustees or officers of the Fund.
6. The Fund assumes and shall pay or cause to be paid all other expenses
of the Fund (except expenses borne by the Fund's manager pursuant to a
management agreement with the Fund), including without limitation: fees
pursuant to any management agreement into which the Fund may enter; fee
pursuant to any plan of distribution that the Fund may adopt; the charges and
expenses of any registrar, any custodian or depository appointed by the Fund
for the safekeeping of its cash, portfolio securities or commodities and
other property, and any stock transfer or dividend agent or agents appointed
by the Fund; brokers' commissions chargeable to the Fund in connection with
portfolio transactions to which the Fund is a party; all taxes, including
securities or commodities issuance and transfer taxes, and fees payable by
the Fund to federal, state or other governmental agencies; the cost and
expense of engraving or printing of certificates representing shares of the
Fund; all costs and expenses in connection with the registration and
maintenance of registration of the Fund and its shares with the Securities
and Exchange Commission and various states and other jurisdictions (including
filing fees and legal fees and disbursements of counsel and the costs and
expenses of preparing, printing, including typesetting, and distributing
prospectuses and statements of additional information for such purposes); all
expenses of shareholders' and Trustees' meetings and of preparing, printing
and mailing proxy statements and reports to shareholders; fees and travel
expenses of Trustees or members of any advisory board or committee who are
not employees of the Investment Adviser or the Fund's manager or any
corporate affiliate of either of them; all expenses incident to the payment
of any dividend or distribution program; charges and expenses of any outside
service used for pricing of the Fund's shares; charges and expenses of legal
counsel, including counsel to the Trustees of the Fund who are not interested
persons (as defined in the Act) of the Fund or the Investment Adviser or the
Fund's manager, and of independent accountants, in connection with any matter
relating to the Fund; membership dues of industry associations; interest
payable on Fund borrowings; postage; insurance premiums on property or
personnel (including officers and Trustees) of the Fund which inure to its
benefit; extraordinary expenses (including, but not limited to, legal claims
and liabilities and litigation costs and any indemnification related
thereto); and all other charges and costs of the Fund's operation unless
otherwise explicitly provided herein.
7. For the services to be rendered by the Investment Adviser, the Fund
shall pay to the Investment Adviser monthly compensation, calculated from the
day following commencement of operations by the
2
Fund, determined by applying the annual rate of 0.50% to the Fund's average
daily net assets. Except as hereinafter set forth, compensation under this
Agreement shall be calculated and accrued daily and paid monthly by applying
1/365ths of the annual rates to the Fund's net assets each day determined as
of the close of business on that day or the last previous business day. If
this Agreement becomes effective subsequent to the first day of a month or
shall terminate before the last day of a month, compensation for that part of
the month this Agreement is in effect shall be prorated in a manner
consistent with the calculation of the fees as set forth above.
8. The Investment Adviser will use its best efforts in its investment of
the Fund's assets, but in the absence of willful misfeasance, bad faith,
gross negligence or reckless disregard of its obligations hereunder, the
Investment Adviser shall not be liable to the Fund or any of its investors
for any error of judgment or mistake of law or for any act or omission by the
Investment Adviser or for any losses sustained by the Fund or its investors.
The Adviser shall be indemnified by the Fund as an agent of the Fund in
accordance with the terms of Section 4.8 of the Fund's By-Laws.
9. Nothing contained in this Agreement shall prevent the Investment
Adviser or any affiliated person of the Investment Adviser from acting as
investment adviser or manager for any other person, firm or corporation
(including any other investment company), whether or not the investment
objectives or policies of any such other person, firm or corporation are
similar to those of the Fund, and shall not in any way bind or restrict the
Investment Adviser or any such affiliated person from buying, selling or
trading any securities or commodities for their own accounts or for the
account of others for whom the Investment Adviser or any such affiliated
person may be acting. Nothing in this Agreement shall limit or restrict the
right of any Trustee, officer or employee of the Investment Adviser to engage
in any other business or to devote his time and attention in part to the
management or other aspects of any other business whether of a similar or
dissimilar nature.
10. This Agreement shall remain in effect until April 30, 1999 and from
year to year thereafter provided such continuance is approved at least
annually by the vote of holders of a majority, as defined in the Act, of the
outstanding voting securities of the Fund or by the Board of Trustees of the
Fund; provided that in either event such continuance is also approved
annually by the vote of a majority of the Trustees of the Fund who are not
parties to this Agreement or "interested persons" (as defined in the Act) of
any such party, which vote must be cast in person at a meeting called for the
purpose of voting on such approval; provided, however, that (a) the Fund may,
at any time and without the payment of any penalty, terminate this Agreement
upon thirty days' written notice to the Investment Adviser, either by
majority vote of the Trustees of the Fund or by the vote of a majority of the
outstanding voting securities of the Fund; (b) this Agreement shall
immediately terminate in the event of its assignment (to the extent required
by the Act and the rules thereunder) unless such automatic terminations shall
be prevented by an exemptive order of the Securities and Exchange Commission;
and (c) the Investment Adviser may terminate this Agreement without payment
of penalty on thirty days' written notice to the Fund. Any notice under this
Agreement shall be given in writing, addressed and delivered, or mailed
post-paid, to the other party at the principal office of such party.
11. This Agreement may be amended by the parties without the vote or
consent of the shareholders of the Fund to supply any omission, to cure,
correct or supplement any ambiguous, defective or inconsistent provision
hereof, or if they deem it necessary to conform this Agreement to the
requirements of applicable federal laws or regulations, but neither the Fund
nor the Investment Adviser shall be liable for failing to do so.
12. This Agreement shall be construed in accordance with the laws of the
State of New York and the applicable provisions of the Act. To the extent the
applicable law of the State of New York, or any
3
of the provisions herein, conflict with the applicable provisions of the Act,
the Advisers Act or any rules, regulations or orders of the Securities and
Exchange Commission, the latter shall control.
13. The Fund acknowledges that Trust Company of the West, an affiliate of
the Investment Adviser, owns its own name, initials and logo. The Fund agrees
to change its name at the request of the Investment Adviser if this Agreement
is terminated for any reason.
14. The Amended and Restated Declaration of Trust of TCW/DW Emerging
Markets Opportunities Trust, dated , 1997, a copy of which, together
with all amendments thereto (the "Declaration"), is on file in the office of
the Secretary of the Commonwealth of Massachusetts, provides that the name
TCW/DW Emerging Markets Opportunities Trust refers to the Trustees under the
Declaration collectively as Trustees, but not as individuals or personally;
and no Trustee, shareholder, officer, employee or agent of TCW/DW Emerging
Markets Opportunities Trust shall be held to any personal liability, nor
shall resort be had to their private property for the satisfaction of any
obligation or claim or otherwise, in connection with the affairs of said
TCW/DW Emerging Markets Opportunities Trust, but the Trust Estate only shall
be liable.
4
IN WITNESS WHEREOF, the parties hereto have executed and delivered this
Agreement, as amended, on the day and year first above written in New York,
New York.
TCW/DW EMERGING MARKETS
OPPORTUNITIES TRUST
By .......................
Attest:
.....................................
TCW FUNDS MANAGEMENT, INC.
By .......................
By .......................
Attest:
......................................
5
EXHIBIT C
FORM OF SUB-ADVISORY AGREEMENT
AGREEMENT made as of the day of , 1997 by and between TCW Funds
Management, Inc., a California corporation ("FMI"), and TCW Asia Limited, a
Hong Kong corporation ("TCW Asia").
WHEREAS, FMI has entered into an Investment Advisory Agreement with TCW/DW
Emerging Markets Opportunities Trust (the "Fund") to provide investment
advisory services for the Fund;
WHEREAS, TCW Asia is registered as an investment adviser under the
Investment Advisers Act of 1940, and engages in the business of acting as an
investment adviser;
WHEREAS, FMI desires to retain the services of TCW Asia to render
investment advisory services for the Fund in the manner and on the terms and
conditions hereinafter set forth;
WHEREAS, TCW Asia desires to be retained by FMI to provide such investment
advisory services on said terms and conditions;
NOW, THEREFORE; in consideration of the foregoing recitals and the mutual
covenants and agreements contained herein, the parties agree as follows:
1. Subject to the supervision of FMI, and in accordance with the
investment objective, policies and restrictions set forth in the then current
Registration Statement, which is hereby incorporated by reference, relating
to the Fund which Registration Statement contains a recital of risk factors,
and such investment objective, policies and restrictions from time to time
prescribed by the Trustees of the Fund and communicated by FMI in writing to
TCW Asia, TCW Asia agrees to provide the Fund with investment advisory
services including, but not limited to, obtaining and evaluating such
information and advice relating to the economy, securities and commodities
markets and securities and commodities as it deems necessary or useful to
discharge its duties hereunder and shall manage the assets of the Fund in a
manner consistent with the investment objective and policies of the Fund and
shall determine the securities and commodities to be purchased, acquired,
sold or otherwise disposed of by the Fund and the timing of such purchases,
acquisitions, sales or dispositions. TCW Asia agrees to furnish to or place
at the disposal of FMI the information, evaluations, analyses and opinions
formulated or obtained by it in performing its advisory services under this
Agreement. FMI and TCW Asia agree to make their officers and employees
available to the other from time to time at reasonable times to review
investment policies of the Fund and to consult with each other. Nothing in
this Agreement shall require FMI to utilize the services of TCW Asia with
respect to any specific or minimum percentage of the assets of the Fund.
2. TCW Asia shall, at its own expense, maintain such staff and employ or
retain such personnel and consult with such other persons as it shall from
time to time determine to be necessary or useful to the performance of its
obligations under this Agreement. Without limiting the generality of the
foregoing, the staff and personnel of TCW Asia shall be deemed to include
persons employed or otherwise retained by TCW Asia to furnish statistical and
other factual data, advice regarding economic factors and trends,
information, advice and assistance as FMI may desire. TCW Asia shall maintain
whatever records as may be required to be maintained by it under the
Investment Company Act of 1940, as amended (the "Act"), or the Investment
Advisers Act of 1940. All such records so maintained shall be the property of
the Fund and shall be made available to FMI and the Fund, upon the request of
FMI or the Fund. TCW Asia shall provide all account statements and
performance or financial records as required by United States securities
laws. TCW Asia acknowledges that cash balances and other assets of the Fund
will be held by Custodian bank(s) designated by the Fund.
3. FMI will, from time to time, furnish or otherwise make available to TCW
Asia such financial reports, proxy statements and other information provided
it by the Fund, including investment policies and restrictions from time to
time prescribed by the Trustees of the Fund, relating to the business and
affairs of the Fund as TCW Asia may reasonably require in order to discharge
its duties and obligations hereunder or to comply with any applicable law and
regulations. All instructions given by FMI to TCW Asia shall be in writing
and sent to TCW Asia's principal office and shall take effect upon actual
receipt by TCW Asia.
1
4. For the services to be rendered, FMI, at its own expense, shall pay TCW
Asia monthly compensation, determined by applying the annual rate of 0.50% to
the Trust's average daily net assets for which TCW Asia renders sub-advisory
services. For the purpose of calculating such fee, the net asset value for a
month shall be the average of the daily net asset values for which TCW Asia
provides sub-advisory services as determined for each business day of the
month. If this Agreement becomes effective after the first day of a month, or
terminates before the last day of a month, the foregoing compensation shall
be prorated.
In the event that the aggregate compensation received by FMI from the
Trust for any month is less than that specified above, the compensation
payable by FMI to TCW Asia shall be equal to that received by FMI. The
compensation of TCW Asia is a responsibility of FMI and not a responsibility
of the Trust.
5. TCW Asia will use its best efforts in the performance of investment
activities on behalf of the Fund, but in the absence of willful misfeasance,
bad faith, gross negligence or reckless disregard of its obligations
hereunder, TCW Asia shall not be liable to InterCapital, FMI or the Fund or
any of its investors for any error of judgment or mistake of law or for any
act or omission by TCW Asia or for any losses sustained by the Fund or its
investors. TCW Asia shall be indemnified by the Fund as an agent of the Fund
in accordance with the terms of Section 4.8 of the Fund's By-Laws.
6. It is understood that any of the shareholders, Trustees, officers and
employees of the Fund may be a shareholder, director, officer or employee of,
or be otherwise interested in, TCW Asia and in any person controlled by or
under common control or affiliated with TCW Asia and that TCW Asia and any
person controlled by or under common control or affiliated with TCW Asia may
have an interest in the Fund. It is also understood that TCW Asia and any
affiliated persons thereof or any persons controlled by or under common
control with TCW Asia have and may have advisory, management service or other
contracts with other organizations and persons, and may have other interests
and businesses, and further may purchase, sell or trade any securities or
commodities for their own accounts or for the account of others for whom they
may be acting. Nothing contained in this Agreement shall limit or restrict
TCW Asia or any affiliated person thereof from so acting or engaging in any
other business.
7. This Agreement shall remain in effect until April 30, 1999 and from
year to year thereafter provided such continuance is approved at least
annually by the vote of holders of a majority, as defined in the Act, of the
outstanding voting securities of the Fund or by the Trustees of the Fund;
provided, that in either event such continuance is also approved annually by
the vote of a majority of the Trustees of the Fund who are not parties to
this Agreement or "interested persons" (as defined in the Act) of any such
party, which vote must be cast in person at a meeting called for the purpose
of voting on such approval; provided, however, that (a) the Fund may at any
time and without the payment of any penalty, terminate this Agreement upon
thirty days' written notice to FMI and TCW Asia, either by majority vote of
the Trustees of the Fund; (b) this Agreement shall immediately terminate in
the event of its assignment, as defined in the Act, unless automatic
termination shall be prevented by an exemptive order of the Securities and
Exchange Commission; (c) this Agreement shall immediately terminate in the
event of the termination of the Investment Advisory Agreement; (d) FMI may
terminate this Agreement without payment of penalty on thirty days' written
notice to TCW Asia and the Fund; and (e) TCW Asia may terminate this
Agreement without the payment of penalty on thirty days' written notice to
FMI and the Fund. Any notice under this Agreement shall be given in writing,
addressed and delivered, or mailed postage paid, to the other party at its
principal business office.
8. This Agreement may be amended by the parties without the vote or
consent of the shareholders of the Fund to supply any omission, to cure,
correct or supplement any ambiguous, defective or inconsistent provision
hereof, or if they deem it necessary to conform this Agreement to the
requirements of applicable federal laws or regulations, but neither the Fund,
FMI nor TCW Asia shall be liable for failing to do so.
9. This Agreement shall be construed in accordance with the law of the
State of California and the applicable provisions of the Act. To the extent
the applicable law of the State of California, or any of the provisions
herein, conflicts with the applicable provisions of the Act, the latter shall
control.
10. The effective date of this Agreement shall be the day and year first
written above.
2
IN WITNESS WHEREOF, the parties hereto have executed and delivered this
Agreement on the day and year first above written in Los Angeles, California.
Accepted and Agreed to as of the Day and Year First Above Written:
TCW/DW EMERGING
MARKETS OPPORTUNITIES TRUST
By:
- -----------------------------------
Name:
- -----------------------------------
Title:
- -----------------------------------
Attest:
- -----------------------------------
Name:
- -----------------------------------
Title:
- -----------------------------------
TCW FUNDS MANAGEMENT, INC.
By: /s/
- -----------------------------------
Name:
- -----------------------------------
Title:
- -----------------------------------
Attest:
- -----------------------------------
Name:
- -----------------------------------
Title:
- -----------------------------------
TCW ASIA LIMITED
By:
- -----------------------------------
Name:
- -----------------------------------
Title:
- -----------------------------------
Attest:
- -----------------------------------
Name:
- -----------------------------------
Title:
- -----------------------------------
3
EXHIBIT D
FORM OF SUB-ADVISORY AGREEMENT
AGREEMENT made as of the day of , 1997 by and between TCW Funds
Management, Inc., a California corporation ("FMI"), and TCW London
International, Limited, a California corporation ("TCW London").
Whereas, FMI has entered into an Investment Advisory Agreement with TCW/DW
Emerging Markets Opportunities Trust (the "Fund") to provide investment
advisory services for the Fund;
Whereas, TCW London is registered as an investment adviser under the
Investment Advisers Act of 1940, and engages in the business of acting as an
investment adviser;
Whereas, TCW London is a member of the Investment Management Regulatory
Organization Limited ("IMRO") and as such is regulated by IMRO in the conduct
of its investment business and nothing in this Agreement shall exclude any
liability of TCW London to the Fund under the Financial Services Act of 1986
or the IMRO Rules;
Whereas, FMI desires to retain the services of TCW London to render
investment advisory services for the Fund in the manner and on the terms and
conditions hereinafter set forth;
Whereas, TCW London desires to be retained by FMI to provide such investment
advisory services on said terms and conditions;
NOW, THEREFORE; in consideration of the foregoing recitals and the mutual
covenants and agreements contained herein, the parties agree as follows:
1. Subject to the supervision of FMI, and in accordance with the
investment objective, policies and restrictions set forth in the then current
Registration Statement, which is hereby incorporated by reference, relating
to the Fund which Registration Statement contains a recital of risk factors,
and such investment objective, policies and restrictions from time to time
prescribed by the Trustees of the Fund and communicated by FMI in writing to
TCW London, TCW London agrees to provide the Fund with investment advisory
services including, but not limited to, obtaining and evaluating such
information and advice relating to the economy, securities and commodities
markets and securities and commodities as it deems necessary or useful to
discharge its duties hereunder and shall manage the assets of the Fund in a
manner consistent with the investment objective and policies of the Fund and
shall determine the securities and commodities to be purchased, acquired,
sold or otherwise disposed of by the Fund and the timing of such purchases,
acquisitions, sales or dispositions. TCW London agrees to furnish to or place
at the disposal of FMI the information, evaluations, analyses and opinions
formulated or obtained by it in performing its advisory services under this
Agreement. FMI and TCW London agree to make their officers and employees
available to the other from time to time at reasonable times to review
investment policies of the Fund and to consult with each other. Nothing in
this Agreement shall require FMI to utilize the services of TCW London with
respect to any specific or minimum percentage of the assets of the Fund.
2. TCW London shall, at its own expense, maintain such staff and employ or
retain such personnel and consult with such other persons as it shall from
time to time determine to be necessary or useful to the performance of its
obligations under this Agreement. Without limiting the generality of the
foregoing, the staff and personnel of TCW London shall be deemed to include
persons employed or otherwise retained by TCW London to furnish statistical
and other factual data, advice regarding economic factors and trends,
information, advice and assistance as FMI may desire. TCW London shall
maintain whatever records as may be required to be maintained by it under the
Investment Company Act of 1940, as amended (the "Act"), or the Investment
Advisers Act of 1940. All such records so maintained shall be the property of
the Fund and shall be made available to FMI and the Fund, upon the request of
FMI or the Fund. TCW London shall provide all account statements and
performance or financial records as required by United States securities
laws. TCW London acknowledges that cash balances and other assets of the Fund
will be held by Custodian bank(s) designated by the Fund.
1
3. FMI will, from time to time, furnish or otherwise make available to TCW
London such financial reports, proxy statements and other information
provided it by the Fund, including investment policies and restrictions from
time to time prescribed by the Trustees of the Fund, relating to the business
and affairs of the Fund as TCW London may reasonably require in order to
discharge its duties and obligations hereunder or to comply with any
applicable law and regulations. All instructions given by FMI to TCW London
shall be in writing and sent to TCW London's principal office and shall take
effect upon actual receipt by TCW London.
4. For the services to be rendered, FMI, at its own expense, shall pay TCW
London monthly compensation, determined by applying the annual rate of 0.50%
to the Trust's average daily net assets for which TCW London renders
sub-advisory services. For the purpose of calculating such fee, the net asset
value for a month shall be the average of the daily net asset values for
which TCW London provides sub-advisory services as determined for each
business day of the month. If this Agreement becomes effective after the
first day of a month, or terminates before the last day of a month, the
foregoing compensation shall be prorated.
In the event that the aggregate compensation received by FMI from the
Trust for any month is less than that specified above, the compensation
payable by FMI to TCW London shall be equal to that received by FMI. The
compensation of TCW London is a responsibility of FMI and not a
responsibility of the Trust.
5. TCW London will use its best efforts in the performance of investment
activities on behalf of the Fund, but in the absence of willful misfeasance,
bad faith, gross negligence or reckless disregard of its obligations
hereunder, TCW London shall not be liable to InterCapital, FMI or the Fund or
any of its investors for any error of judgment or mistake of law or for any
act or omission by TCW London or for any losses sustained by the Fund or its
investors. TCW London shall be indemnified by the Fund as an agent of the
Fund in accordance with the terms of Section 4.8 of the Fund's By-Laws.
6. It is understood that any of the shareholders, Trustees, officers and
employees of the Fund may be a shareholder, director, officer or employee of,
or be otherwise interested in, TCW London and in any person controlled by or
under common control or affiliated with TCW London and that TCW London and
any person controlled by or under common control or affiliated with TCW
London may have an interest in the Fund. It is also understood that TCW
London and any affiliated persons thereof or any persons controlled by or
under common control with TCW London have and may have advisory, management
service or other contracts with other organizations and persons, and may have
other interests and businesses, and further may purchase, sell or trade any
securities or commodities for their own accounts or for the account of others
for whom they may be acting. Nothing contained in this Agreement shall limit
or restrict TCW London or any affiliated person thereof from so acting or
engaging in any other business.
7. This Agreement shall remain in effect until April 30, 1999 and from
year to year thereafter provided such continuance is approved at least
annually by the vote of holders of a majority, as defined in the Act, of the
outstanding voting securities of the Fund or by the Trustees of the Fund;
provided, that in either event such continuance is also approved annually by
the vote of a majority of the Trustees of the Fund who are not parties to
this Agreement or "interested persons" (as defined in the Act) of any such
party, which vote must be cast in person at a meeting called for the purpose
of voting on such approval; provided, however, that (a) the Fund may at any
time and without the payment of any penalty, terminate this Agreement upon
thirty days' written notice to FMI and TCW London, either by majority vote of
the Trustees of the Fund; (b) this Agreement shall immediately terminate in
the event of its assignment, as defined in the Act, unless automatic
termination shall be prevented by an exemptive order of the Securities and
Exchange Commission; (c) this Agreement shall immediately terminate in the
event of the termination of the Investment Advisory Agreement; (d) FMI may
terminate this Agreement without payment of penalty on thirty days' written
notice to TCW London and the Fund; and (e) TCW London may terminate this
Agreement without the payment of penalty on thirty days' written notice to
FMI and the Fund. Any notice under this Agreement shall be given in writing,
addressed and delivered, or mailed postage paid, to the other party at its
principal business office.
2
8. This Agreement may be amended by the parties without the vote or
consent of the shareholders of the Fund to supply any omission, to cure,
correct or supplement any ambiguous, defective or inconsistent provision
hereof, or if they deem it necessary to conform this Agreement to the
requirements of applicable federal laws or regulations, but neither the Fund,
FMI nor TCW London shall be liable for failing to do so.
9. All formal complaints should, in the first instance, be made in writing
to TCW London's compliance officer at TCW London's principal office. In
addition, the FMI and/or the Fund shall have a right to complain directly to
IMRO.
10. A statement is available from TCW London describing FMI's and/or the
Fund's rights to compensation, if any, in the event that TCW London is unable
to meet its liabilities.
11. FMI acknowledges that for purposes of the IMRO rules, it will be
treated as a non-private customer.
12. This Agreement shall be construed in accordance with the law of the
State of California and the applicable provisions of the Act. To the extent
the applicable law of the State of California, or any of the provisions
herein, conflicts with the applicable provisions of the Act, the latter shall
control.
13. The effective date of this Agreement shall be the day and year first
written above.
IN WITNESS WHEREOF, the parties hereto have executed and delivered this
Agreement on the day and year first above written in Los Angeles, California.
Accepted and Agreed to as of the Day and Year First Above Written:
TCW/DW EMERGING
MARKETS OPPORTUNITIES TRUST
By:
- --------------------------------------
Name:
- --------------------------------------
Title:
- --------------------------------------
Attest:
- --------------------------------------
Name:
- --------------------------------------
Title:
- --------------------------------------
TCW FUNDS MANAGEMENT, INC.
By:
- --------------------------------------
Name:
- --------------------------------------
Title:
- --------------------------------------
Attest:
- --------------------------------------
Name:
- --------------------------------------
Title:
- --------------------------------------
TCW LONDON INTERNATIONAL LIMITED
By:
- --------------------------------------
Name:
- --------------------------------------
Title:
- --------------------------------------
Attest:
- --------------------------------------
Name:
- --------------------------------------
Title:
- --------------------------------------
3
EXHIBIT E
PLAN OF DISTRIBUTION PURSUANT TO RULE 12B-1
OF
TCW/DW EMERGING MARKETS OPPORTUNITIES TRUST
WHEREAS, TCW/DW Emerging Markets Opportunities Trust (the "Fund") intends
to engage in business as an open-end management investment company and is
registered as such under the Investment Company Act of 1940, as amended (the
"Act"); and
WHEREAS, the Fund desires to adopt a Plan of Distribution pursuant to Rule
12b-1 under the Act, and the Trustees have determined that there is a
reasonable likelihood that adoption of the Plan of Distribution will benefit
the Fund and its shareholders; and
WHEREAS, the Fund and Dean Witter Distributors Inc. (the "Distributor")
have entered into a separate Distribution Agreement dated as of this date,
pursuant to which the Fund has employed the Distributor in such capacity
during the continuous offering of shares of the Fund.
NOW, THEREFORE, the Fund hereby adopts, and the Distributor hereby agrees
to the terms of, this Plan of Distribution (the "Plan") in accordance with
Rule 12b-1 under the Act on the following terms and conditions:
1. The Fund shall pay to the Distributor, as the distributor of
securities of which the Fund is the issuer, compensation for distribution of
its shares at the rate of 0.25% per annum of the Fund's average daily net
assets. Such compensation shall be calculated and accrued daily and paid
monthly or at such other intervals as the Trustees shall determine. The
Distributor may direct that all or any part of the amounts receivable by it
under this Plan be paid directly to Dean Witter Reynolds Inc. ("DWR"), its
affiliates or other broker-dealers who provide distribution and/or
shareholder services. All payments made hereunder pursuant to the Plan shall
be in accordance with the terms and limitations of the Rules of Conduct of
the National Association of Securities Dealers, Inc.
2. The amount set forth in paragraph 1 of this Plan shall be paid for
services of the Distributor, DWR, its affiliates and other broker-dealers it
may select in connection with the distribution of the Fund's shares,
including personal services to shareholders with respect to their holdings of
Fund shares, and may be spent by the Distributor, DWR, its affiliates and
such broker-dealers on any activities or expenses related to the distribution
of the Fund's shares or services to shareholders, including, but not limited
to: compensation to, and expenses of, account executives or other employees
of the Distributor, DWR, its affiliates or other broker-dealers; overhead and
other branch office distribution-related expenses and telephone expenses of
persons who engage in or support distribution of shares or who provide
personal services to shareholders; printing of prospectuses and reports for
other than existing shareholders; preparation, printing and distribution of
sales literature and advertising materials and opportunity costs in incurring
the foregoing expenses (which may be calculated as a carrying charge on the
excess of the distribution expenses incurred by the Distributor, DWR, its
affiliates or other broker-dealers over distribution revenues received by
them). The overhead and other branch office distribution-related expenses
referred to in this paragraph 2 may include: (a) the expenses of operating
the branch offices of the Distributor or other broker-dealers, including DWR,
in connection with the sale of Fund shares, including lease costs, the
salaries and employee benefits of operations and sales support personnel,
utility costs, communications costs and the costs of stationery and supplies;
(b) the costs of client sales seminars; (c) travel expenses of mutual fund
sales coordinators to promote the sale of Fund shares; and (d) other expenses
relating to branch promotion of Fund sales. Payments may also be made with
respect to distribution expenses incurred in connection with the distribution
of shares, including personal services to shareholders with respect to
holdings of such shares, of an investment company whose assets are acquired
by the Fund in a tax-free reorganization.
1
3. This Plan shall not take effect until it has been approved by a vote
of at least a majority of the outstanding voting securities of the Fund (as
defined in the Act).
4. This Plan shall not take effect until it has been approved, together
with any related agreements, by votes of a majority of the Board of Trustees
of the Fund and of the Trustees who are not "interested persons" of the Fund
(as defined in the Act) and have no direct or indirect financial interest in
the operation of this Plan or any agreements related to it (the "Rule 12b-1
Trustees"), cast in person at a meeting (or meetings) called for the purpose
of voting on this Plan and such related agreements.
5. This Plan shall continue in effect until April 30, 1998, and from year
to year thereafter, provided such continuance is specifically approved at
least annually in the manner provided for approval of this Plan in paragraph
4 hereof.
6. The Distributor shall provide to the Trustees of the Fund and the
Trustees shall review, at least quarterly, a written report of the amounts so
expended and the purposes for which such expenditures were made. In this
regard, the Trustees shall request the Distributor to specify such items of
expenses as the Trustees deem appropriate. The Trustees shall consider such
items as they deem relevant in making the determinations required by
paragraph 5 hereof.
7. This Plan may be terminated at any time by vote of a majority of the
Rule 12b-1 Trustees, or by vote of a majority of the outstanding voting
securities of the Fund. In the event of any such termination or in the event
of nonrenewal, the Fund shall have no obligation to pay expenses which have
been incurred by the Distributor, DWR, its affiliates or other broker-dealers
in excess of payments made by the Fund pursuant to this Plan. However, this
shall not preclude consideration by the Trustees of the manner in which such
excess expenses shall be treated.
8. This Plan may not be amended to increase materially the amount the
Fund may spend for distribution provided in paragraph 1 hereof unless such
amendment is approved by a vote of at least a majority (as defined in the
Act) of the outstanding voting securities of the Fund, and no material
amendment to the Plan shall be made unless approved in the manner provided
for approval in paragraph 4 hereof.
9. While this Plan is in effect, the selection and nomination of Trustees
who are not interested persons (as defined in the Act) of the Fund shall be
committed to the discretion of the Trustees who are not interested persons.
10. The Fund shall preserve copies of this Plan and any related agreements
and all reports made pursuant to paragraph 6 hereof, for a period of not less
than six years from the date of this Plan, any such agreement or any such
report, as the case may be, the first two years in an easily accessible
place.
11. The Amended and Restated Declaration of Trust of TCW/DW Emerging
Markets Opportunities Trust, dated , 1997, a copy of which, together
with all amendments thereto (the "Declaration"), is on file in the office of
the Secretary of the Commonwealth of Massachusetts, provides that the name
TCW/DW Emerging Markets Opportunities Trust refers to the Trustees under the
Declaration collectively as Trustees but not as individuals or personally;
and no Trustee, shareholder, officer, employee or agent of TCW/DW Emerging
Markets Opportunities Trust shall be held to any personal liability, nor
shall resort be had to their private property for the satisfaction of any
obligation or claim or otherwise, in connection with the affairs of said
TCW/DW Emerging Markets Opportunities Trust, but the Trust Estate only shall
be liable.
2
IN WITNESS WHEREOF, the Fund and the Distributor have executed this Plan
of Distribution as of the day and year set forth below in New York, New York.
Date: , 1977
TCW/DW EMERGING MARKETS
OPPORTUNITIES TRUST
By
Attest: .................................
..................................... DEAN WITTER DISTRIBUTORS INC.
By
Attest: .................................
.....................................
3
TCW/DW EMERGING MARKETS THIS PROXY IS SOLICITED ON BEHALF OF
OPPORTUNITIES TRUST THE BOARD OF TRUSTEES OF THE TRUST
The undersigned hereby appoints Robert M. Scanlan, Barry Fink and Joseph
J. McAlinden, or any of them, proxies, each with the power of substitution,
to vote on behalf of the undersigned at the Annual Meeting of Stockholders of
TCW/DW Emerging Markets Opportunities Trust on June 24, 1997 at 10:00 a.m.,
New York City time, and at any adjournments thereof, on the proposals set
forth in the Notice of Meeting dated May 5, 1997 as follows:
The shares represented by this proxy will be voted on the following
matters as specified on the reverse side by the undersigned. If no
specification is made, this proxy will be voted in favor of Proposals 1-3 and
5-10 and in abstention on Proposal 4. Note: This proxy must be returned in
order for your shares to be voted.
---------------------------------
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Please sign in box above exactly
as your name or names appear at
left.
Dated , 1997
--------------------
(OVER)
Please vote by filling in the appropriate boxes below, as shown, using blue
or black ink or dark pencil. Do not use red ink. [x]
1. Election of Trustees: FOR THE NOMINEES, WITHHOLD 1.
Richard M. Demartini, Thomas E. Larkin, Jr. EXCEPT THOSE AUTHORITY
TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL NOMINEE, WHOSE NAMES TO VOTE FOR ANY
WRITE THAT NOMINEE'S NAME ON THE LINE BELOW. ARE INSERTED ON OF THE NOMINEES
THE LINE AT LEFT:
[ ] [ ]
---------------------------------------------------------------
FOR AGAINST ABSTAIN
2. Approval of Investment Advisory Agreement [ ] [ ] [ ] 2.
3. Ratification of Appointment of Price Waterhouse Llp as [ ] [ ] [ ] 3.
Independent Accountants
4. Shareholder Proposal Recommending the Board of Trustees take [ ] [ ] [ ] 4.
action to open-end the Trust
5. If Proposal 4 is approved, approval of conversion to open-end [ ] [ ] [ ] 5.
the Trust
6. If Proposal 4 is approved, election of Trustees: FOR THE NOMINEES, WITHHOLD 6.
Richard M. Demartini, Thomas E. Larkin, Jr., John C. Argue, EXCEPT THOSE AUTHORITY
Charles A. Fiumefreddo, John R. Haire, Manuel H. Johnson, WHOSE NAMES TO VOTE FOR ANY
Michael E. Nugent, John L. Schroeder, Marc I. Stern ARE INSERTED ON OF THE NOMINEES
TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL NOMINEE, THE LINE AT LEFT:
WRITE THAT NOMINEE'S NAME ON THE LINE BELOW. [ ] [ ]
FOR AGAINST ABSTAIN
---------------------------------------------------------------
7. If Proposal 4 is approved, approval of New Investment Advisory [ ] [ ] [ ] 7.
Agreement
8. If Proposal 4 is approved, approval of New Sub-advisory [ ] [ ] [ ] 8.
Agreement with TCW London International Limited
9. If Proposal 4 is approved, approval of New Sub-advisory [ ] [ ] [ ] 9.
Agreement with TCW Asia Limited
10. If Proposal 4 is approved, approval of Plan of Distribution [ ] [ ] [ ] 10.
As to any other matter, or if any of the nominees named in the Proxy
Statement are not available for election, said attorneys shall vote in
accordance with their judgment.
PRX00020