SCHEDULE 14A
(RULE 14A-101)
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:
|_| Preliminary Proxy Statement
|_| Confidential, for Use of the Commission Only
(as permitted by Rule 14a-6(e)(2))
|X| Definitive Proxy Statement
|_| Definitive Additional Materials
|_| Soliciting Material Pursuant to Section 14a-11(c) or Section 14a-12
The India Fund, Inc.
----------------------------------------------------------------------------
(Name of Registrant as Specified in Its Charter)
Payment of Filing Fee (Check the appropriate box):
|X| No fee required.
|_| Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
(1) Title of each class of securities to which transaction applies:
--------------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
--------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which
the filing fee is calculated and state how it was determined):
--------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
--------------------------------------------------------------------------
(5) Total fee paid:
|_| Fee paid previously with preliminary materials.
|_| Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by the registration
statement number, or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
--------------------------------------------------------------------------
(2) Form, Schedule or Registration Statement No.:
--------------------------------------------------------------------------
(3) Filing Party:
--------------------------------------------------------------------------
(4) Date Filed:
--------------------------------------------------------------------------
The India Fund, Inc.
One World Financial Center
200 Liberty Street
New York, New York 10281
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
March 9, 2001
To the Stockholders:
The Annual Meeting of Stockholders of The India Fund, Inc. (the "Fund")
will be held at One World Financial Center, 200 Liberty Street, New York, New
York on the 40th floor, on Friday, April 20, 2001, at 1:00 p.m., for the
purposes of considering and voting upon:
1. The election of directors (Proposal 1).
2. The approval of a new country advisory agreement between
Advantage Advisers, Inc. and Advantage India, Inc. (Proposal
2).
3. Any other business that may properly come before the meeting.
The close of business on March 2, 2001 has been fixed as the record date
for the determination of stockholders entitled to notice of and to vote at the
meeting.
By Order of the Board of Directors,
/s/ Bryan McKigney
Bryan McKigney
President, Director and Secretary
--------------------------------------------------------------------------------
TO AVOID UNNECESSARY EXPENSE OF FURTHER SOLICITATION, WE URGE YOU to
indicate voting instructions on the enclosed proxy card, date and sign it
and return it promptly in the envelope provided, no matter how large or
small your holdings may be.
--------------------------------------------------------------------------------
Instructions for Signing Proxy Cards
The following general rules for signing proxy cards may be of assistance
to you and avoid the time and expense to the Fund involved in validating your
vote if you fail to sign your proxy card properly.
1. Individual Accounts: Sign your name exactly as it appears in the
registration on the proxy card.
2. Joint Accounts: Either party may sign, but the name of the party
signing should conform exactly to a name shown in the registration.
3. Other Accounts: The capacity of the individual signing the proxy card
should be indicated unless it is reflected in the form of registration. For
example:
REGISTRATION
Corporate Accounts Valid Signature
(1) ABC Corp. ........................... ABC Corp. (by John Doe,
Treasurer)
(2) ABC Corp. ........................... John Doe, Treasurer
(3) ABC Corp. c/o John Doe, Treasurer.... John Doe
(4) ABC Corp. Profit Sharing Plan ....... John Doe, Trustee
Trust Accounts
(1) ABC Trust............................ Jane B. Doe, Trustee
(2) Jane B. Doe, Trustee u/t/d 12/28/78.. Jane B. Doe
Custodial or Estate Accounts
(1) John B. Smith, Cust.
f/b/o John B. Smith, Jr. UGMA..... John B. Smith
(2) John B. Smith........................ John B. Smith, Jr., Executor
The India Fund, Inc.
One World Financial Center
200 Liberty Street
New York, New York 10281
---------------
PROXY STATEMENT
---------------
This proxy statement is furnished in connection with a solicitation by the
Board of Directors of The India Fund, Inc. (the "Fund") of proxies to be used at
the Annual Meeting of Stockholders of the Fund (the "Annual Meeting") to be held
at One World Financial Center, 200 Liberty Street, New York, New York on the
40th floor, on Friday, April 20, 2001, at 1:00 p.m. (and at any adjournment or
adjournments thereof) for the purposes set forth in the accompanying Notice of
Annual Meeting of Stockholders. This proxy statement and the accompanying form
of proxy are first being mailed to stockholders on or about March 9, 2001. Any
stockholder may also request an additional copy of the Fund's annual report,
free of charge, by contacting Advantage Advisers, Inc. at the address listed
below or by calling 1-800-421-4777. Stockholders who execute proxies retain the
right to revoke them in person at the Annual Meeting or by written notice
received by the Secretary of the Fund at any time before they are voted.
Unrevoked proxies will be voted in accordance with the specifications thereon
and, unless specified to the contrary, will be voted FOR the Election of
Directors and FOR the approval of a new country advisory agreement. The close of
business on March 2, 2001 has been fixed as the record date for the
determination of stockholders entitled to notice of and to vote at the Annual
Meeting. Each stockholder is entitled to one vote for each full share and an
appropriate fraction of a vote for each fractional share held. On the record
date there were 31,098,333 shares of the Fund's Common Stock outstanding.
In the event that a quorum is not present at the Annual Meeting, or in the
event that a quorum is present but sufficient votes to approve any of the
proposals are not received, the persons named as proxies may propose one or more
adjournments of the Annual Meeting to a date not more than 120 days after the
original record date to permit further solicitation of proxies. Any such
adjournment will require the affirmative vote of a majority of those shares
represented at the Annual Meeting in person or by proxy. The persons named as
proxies will vote those proxies which they are entitled to vote FOR or AGAINST
any such proposal at their discretion. A stockholder vote may be taken on one or
more of the proposals in this proxy statement prior to any such adjournment if
sufficient votes have been received for approval. Under the By-Laws of the Fund,
a quorum is constituted by the presence in person or by proxy of the holders of
record of a majority of the outstanding shares of Common Stock of the Fund
entitled to vote at the Annual Meeting.
Advantage Advisers, Inc. ("Advantage"), whose principal business address
is One World Financial Center, 200 Liberty Street, New York, New York 10281, is
the Fund's investment manager.
1
PROPOSAL 1: ELECTION OF DIRECTORS
In accordance with the Fund's Charter, the Fund's Board of Directors is
divided into three classes: Class I, Class II and Class III. At the Annual
Meeting, stockholders will be asked to elect one Class II and two Class III
Directors to hold office until the 2003 and 2004 Annual Meetings of
Stockholders, respectively, or thereafter when their respective successors are
elected and qualified. The term of office of the Class I Directors expires at
the Annual Meeting of Stockholders in 2002 or thereafter when their successors
are elected and qualified. The effect of these staggered terms is to limit the
ability of other entities or persons to acquire control of the Fund by delaying
the replacement of a majority of the Board of Directors.
The persons named in the accompanying form of proxy intend to vote at the
Annual Meeting (unless directed not to vote) FOR the election of the nominees
listed below. Each nominee has indicated that he will serve if elected, but if
either nominee should be unable to serve, the proxy will be voted for any other
person determined by the persons named in the proxy in accordance with their
judgment. Bryan McKigney and Howard M. Singer were elected to the Board of
Directors by the directors of the Fund effective July 11, 2000.
The following table provides information concerning the nominees for
election as directors:
Shares of Common Stock
Beneficially Owned,
Nominees and Principal Occupations Directly or Indirectly, on
During the Past Five Years Director Since Age March 2, 2001 (A)
---------------------------------------------------------------------------------------------------------
Nominee to serve until the year 2003
Annual Meeting of Stockholders
Howard M. Singer,* Chairman of the Board 2000 37 500
of Directors; Managing Director,
CIBC World Markets Corp.
Nominees to serve until the year 2004
Annual Meeting of Stockholders
Bryan McKigney,* President and Secretary of the 2000 42 1000
Fund; Managing Director (2000-Present) and
Executive Director (1993-2000), CIBC World
Markets Corp.; Vice President and Division
Executive, Head of Derivative Operations
(1986-1993) and Assistant Vice President,
Securities and Commodity Operations (1981-1985),
Chase Manhattan Bank
Sir Rene Maingard, C.B.E., Director, Rogers & Co., 1994 83 0
Ltd. (shipping, banking).
----------
* "Interested person" as defined in the Investment Company Act of 1940, as
amended (the "1940 Act"), because of a relationship with Advantage.
(A) The holdings of no director represented more than 1% of the outstanding
shares of the Fund. Each director has sole voting and investment power
with respect to the listed shares.
2
The following table provides information concerning the directors serving
until the Year 2002 and 2003 Annual Meetings of Stockholders:
Shares of Common Stock
Beneficially Owned,
Directors and Principal Occupations Directly or Indirectly, on
During the Past Five Years Director Since Age March 2, 2001 (A)
---------------------------------------------------------------------------------------------------------
Directors serving until the year 2002
Annual Meeting of Stockholders
Leslie H. Gelb, Member of Audit and Nominating 1994 64 100
Committees; President, The Council on Foreign
Relations (1993-Present); Columnist (1991-1993),
Deputy Editorial Page Editor (1986-1990) and
Editor, Op-Ed Page (1988-1990), The New York Times.
Luis Rubio, Member of Audit and Nominating 1999 45 40
Committees; President, Centro de Investigacion
para el Desarrollo, A.C. (Center of Research for
Development) (1981-Present), frequent contributor
of op-ed pieces to The Los Angeles Times and
The Wall Street Journal.
Gabriel Seeyave, Tax Advisor; formerly Partner, De 1994 69 0
Chazal Du Mee & Co. (chartered accountants);
Director, The United Basalt Products Limited.
Directors serving until the year 2003
Annual Meeting of Stockholders
Charles F. Barber, Chairman of Audit Committee; 1994 84 1,000
Member of Nominating Committee; Consultant;
formerly Chairman of the Board, ASARCO
Incorporated.
Jeswald W. Salacuse, Member of Audit Committee; 1994 63 403
Chairman of Nominating Committee; Henry J. Braker
Professor of Commercial Law, The Fletcher
School of Law & Diplomacy (1990-Present); Dean,
The Fletcher School of Law & Diplomacy,
Tufts University (1986-1994).
----------
(A) The holdings of no director represented more than 1% of the outstanding
shares of the Fund. Each director has sole voting and investment power
with respect to the listed shares.
Each of Messrs. Barber, Gelb, Rubio, Salacuse and Singer serves as a
director of certain other U.S. registered investment companies, as described
below. Mr. Barber is a director of one other registered investment company
advised by Advantage, four registered investment companies advised by CIBC
Oppenheimer Advisers, L.L.C. ("CIBC Advisers"), an affiliate of Advantage, six
registered investment companies co-advised by PIMCO Advisors L.P. ("PIMCO
Advisors") and Salomon Brothers Asset Management Inc ("SBAM") and seven other
registered investment companies advised by SBAM. Mr. Gelb is a director of one
other registered investment company advised by Advantage, six other registered
investment companies co-advised by PIMCO Advisors
3
and SBAM and one other registered investment company advised by CIBC Advisers
and TDA Capital Partners. Mr. Rubio is a director of one other registered
investment company advised by Advantage and five registered investment companies
advised by CIBC Advisers. Mr. Salacuse is a director of one other registered
investment company advised by Advantage, six other registered investment
companies co-advised by PIMCO Advisors and SBAM, four other registered
investment companies advised by SBAM, one other registered investment company
advised by PIMCO Advisors and one other registered investment company advised by
CIBC Advisers. Mr. Singer is a director of one other registered investment
company advised by Advantage and eight other registered investment companies
advised by CIBC Advisers.
At March 2, 2001, directors and officers of the Fund as a group owned
beneficially less than 1% of the outstanding shares of the Fund.
The following table sets forth the beneficial ownership of shares of the
Fund, at March 2, 2001 by each person known to the Fund to be deemed to be the
beneficial owner of more than 5% of the outstanding shares of the Fund.
Number of Shares
Name of Beneficial Owner Beneficially Owned Percent Ownership
--------------------------------------------------------------------------------
City of London Investment Group PLC(1) 2,589,450 8.18%
10 Eastcheap
London EC3M ILX
England
----------
(1) Based solely upon information presented in Schedule 13G, providing
information as of December 31, 2000, filed by City of London Investment
Group PLC ("City of London"), which reports sole voting and dispositive
power as to all such shares, as well as a Schedule 13G, providing
information as of December 31, 2000, filed by City of London Investment
Management Company Limited, which reports voting and dispositive power as
to 2,589,450 shares of the Fund. According to the Schedule 13G filed by
City of London, such shares were acquired by its subsidiaries, City of
London Investment Management Company Limited and City of London Unit Trust
Managers Limited. The Fund's understanding is that the aggregate
beneficial ownership of shares of the Fund by these affiliated entities is
reflected in the Schedule 13G filed by City of London. Pursuant to this
understanding, as of December 31, 2000, such ownership would be 2,589,450
shares, representing 8.18% of the outstanding shares of the Fund as of
such date.
In addition, at March 2, 2001, Cede & Co., a nominee for participants in
The Depository Trust Company, held of record 30,940,382 shares, equal to 99.49%
of the outstanding shares of the Fund.
The executive officers of the Fund are chosen each year at the first
meeting of the Board of Directors of the Fund following the Annual Meeting of
Stockholders, to hold office until the meeting of the Board following the next
Annual Meeting of Stockholders and until their successors are chosen and
qualified. In addition to Messrs. McKigney and Singer, the current executive
officer of the Fund is:
Name Office Age Officer Since
-----------------------------------------------------
Alan E. Kaye Treasurer 49 1999
Mr. Kaye is Executive Director of CIBC World Markets Corp. ("CIBC World
Markets") (1995-Present). Mr. Kaye previously served as Vice President of
Oppenheimer & Co., Inc. (1986-1994).
4
Messrs. Kaye, McKigney and Singer also serve as officers of various other
registered investment companies advised by Advantage or affiliates of CIBC World
Markets.
The Fund's Audit Committee is composed entirely of Directors who are not
"interested persons" of the Fund or of Advantage or its affiliates within the
meaning of the 1940 Act, and who are "independent" as defined in the New York
Stock Exchange listing standards. Currently, Messrs. Barber, Gelb, Rubio and
Salacuse are members of the Audit Committee. The Audit Committee convened twice
during the fiscal year ended December 31, 2000. The principal functions of the
Audit Committee are to recommend to the Board the appointment of the Fund's
independent accountants, to review with the independent accountants the scope,
performance and anticipated cost of their audit and to receive and consider a
report from the independent accountants concerning their conduct of the audit,
including the form of the opinion proposed to be rendered and any comments or
recommendations the independent accountants might want to make in that
connection. The Fund adopted an Audit Committee Charter in February 2000, which
was subsequently amended in May 2000. A copy of the Audit Committee Charter is
attached to this Proxy Statement as Exhibit A.
The Audit Committee has received written disclosures and the letter
required by Independence Standards Board Standard No. 1 from
PricewaterhouseCoopers LLP ("PwC"), the Fund's independent accountants, and has
discussed with PwC its independence. The Audit Committee has also reviewed and
discussed the audited financial statements with Fund management and PwC, and
discussed certain matters with PwC required to be discussed by Statements on
Auditing Standards No. 61. Based on the foregoing, the Audit Committee
recommended to the Board of Directors that the Fund's audited financial
statements be included in the Fund's Annual Report for the fiscal year ended
December 31, 2000.
The Fund's Nominating Committee, whose principal function is to recommend
nominees for election as directors of the Fund, is composed of Messrs. Barber,
Gelb, Rubio and Salacuse. This Committee held one meeting during the fiscal year
ended December 31, 2000. The Nominating Committee will accept nominations for
the office of director made by the stockholders in a written request addressed
to the Secretary of the Fund which includes biographical data and sets forth the
qualifications of the proposed nominee. The Fund has no compensation committee.
During the fiscal year ended December 31, 2000, the Board of Directors met
five times. Each director attended at least 75% of the meetings of the Board or
the committee of the Board on which he served.
Under the federal securities laws, the Fund is required to provide to
stockholders in connection with the Annual Meeting information regarding
compensation paid to directors by the Fund as well as by the various other U.S.
registered investment companies advised by Advantage, Infrastructure Leasing and
Financial Services Limited ("ILFS"), the Fund's country adviser, or affiliates
thereof during the Fund's prior fiscal year. The following table provides
information concerning the approximate compensation paid during the fiscal year
ended December 31, 2000 to each director of the Fund. No remuneration was paid
during the fiscal year ended December 31, 2000 by the Fund
5
to Messrs. McKigney and Singer who, as officers and employees of Advantage and
CIBC World Markets, are "interested persons" as defined under the 1940 Act.
Please note that the Fund does not provide any pension or retirement benefits to
directors.
Total Compensation
Aggregate from Other Funds Total Compensation
Compensation Advised by from Fund
Name of Director from Fund Advantage and Fund Complex
---------------- ------------- ------------------ ------------------
Directorships (A) Directorships (A)
Charles F. Barber $9,550 $8,000(1) $43,652(6)
Leslie H. Gelb $9,050 $5,850(1) $14,900(3)
Sir Rene Maingard $9,050 0 $ 9,050(1)
Luis Rubio $9,150 $8,800(2) $47,382(7)
Jeswald W. Salacuse $9,150 $7,900(1) $22,350(3)
Gabriel Seeyave $9,050 0 $ 9,050(1)
----------
(A) The numbers in parentheses indicate the applicable number of investment
company directorships held by that director.
Section 16(a) Beneficial Ownership Reporting Compliance
Section 16(a) of the Securities Exchange Act of 1934 and Section 30(h) of
the 1940 Act in combination require the Fund's directors and officers, persons
who own more than ten percent of the Fund's Common Stock, Advantage, ILFS, and
its directors and officers, to file reports of ownership and changes in
ownership of the Fund's securities with the Securities and Exchange Commission
and the New York Stock Exchange, Inc. The Fund believes that the Fund's
directors and officers, and Advantage and its directors and officers have
complied with applicable filing requirements during the fiscal year ended
December 31, 2000.
Required Vote
Directors are elected by a plurality of the votes cast by the holders of
shares of Common Stock of the Fund present in person or represented by proxy at
a meeting with a quorum present. For purposes of the election of directors,
abstentions and broker non-votes will not be considered votes cast, and do not
affect the plurality vote required for directors.
THE DIRECTORS, INCLUDING THE "NON-INTERESTED" DIRECTORS,
UNANIMOUSLY RECOMMEND THAT THE STOCKHOLDERS VOTE "FOR"
EACH OF THE NOMINEES FOR DIRECTOR.
PROPOSAL 2: APPROVAL OF A NEW COUNTRY ADVISORY AGREEMENT
Introduction
ILFS has served as country adviser to the Fund pursuant to a country
advisory agreement among Advantage, ILFS and the Fund since February 14, 1994,
as amended as of August 1, 1997 (the "ILFS Agreement"). The ILFS Agreement was
last renewed by vote of the Fund's stockholders on September 30, 1997. Due to
affiliations between ILFS and the Indian government, the Fund has been precluded
from participating in certain government privatizations and from purchasing
6
securities of certain financial institutions in India. As a result, the Board of
Directors of the Fund has determined that it would be in the best interests of
the Fund and its stockholders to explore alternatives to ILFS.
Therefore, the Board of Directors of the Fund is proposing that the Fund's
stockholders approve a new country advisory agreement between Advantage and
Advantage India, Inc. (the "New Agreement"). The New Agreement is substantially
similar to the ILFS Agreement and provides that all investment decisions will
continue to be made by Advantage. A description of the New Agreement, including
the services to be provided by Advantage India, Inc. thereunder, is set forth
below. The description is qualified in its entirety by reference to the form of
New Agreement attached to this Proxy Statement as Exhibit B.
Information concerning Advantage India, Inc.
Advantage India, Inc., a corporation organized on February 15, 2001 under
the laws of Delaware, commenced operations in 2001. Its principal business
address is One World Financial Center, 200 Liberty Street, New York, New York
10281 and it anticipates opening an office in India. It is a wholly-owned
subsidiary of CIBC World Markets. Advantage India, Inc. is in the process of
becoming registered as an investment adviser under the Investment Advisers Act
of 1940.
The names, titles and principal occupations of the current directors and
executive officers of Advantage India, Inc. are set forth in the following
table. The business address of each person listed below is One World Financial
Center, 200 Liberty Street, New York, New York 10281.
Name Title and Principal Occupation
---- ------------------------------
Howard Singer(A) President
Bruce Renihan Chief Financial Officer
Thomas Gallagher Managing Director
Mark Kaplan Managing Director
Seth Novatt Managing Director
Bryan McKigney(A) Managing Director
Punita Kumar-Sinha Managing Director
Joyce Burns Executive Director-Tax
Barbara Pires(B) Executive Director
Patricia Bourdon Secretary
Elliot Ganz Assistant Secretary
----------
(A) Indicates individual is also a director of the Fund.
(B) Indicates individual is also an officer of the Fund.
Description of the New Agreement
The New Agreement and the ILFS Agreement are substantially similar. The
following description of the New Agreement is qualified in its entirety by
reference to the form of the New Agreement attached hereto as Exhibit B.
7
Services to be Performed
Pursuant to the New Agreement, subject to the direction and control of the
directors of the Fund and in consultation with Advantage, Advantage India, Inc.
will: (i) provide or procure statistical and factual information and research
regarding economic and political factors and trends in India and its surrounding
region; (ii) provide or procure research and statistical data in relation to
investing and other opportunities in India and its surrounding region; and (iii)
provide assistance in the implementation and coordination of execution of
investment decisions as directed by Advantage. All investment decisions will
continue to be made by Advantage.
Expenses and Advisory Fees
The New Agreement provides that Advantage India, Inc. is responsible for
all of its expenses and liabilities, including expenses in connection with
providing office space, office facilities and personnel reasonably necessary for
performance of the services to be provided by it to Advantage.
The rate used to determine the fees payable by Advantage to Advantage
India, Inc. pursuant to the New Agreement will be agreed upon by Advantage and
Advantage India, Inc. from time to time and will not exceed 1.10% of the Fund's
average weekly net assets, which is the rate of fees payable by the Fund to
Advantage.
Duration and Termination
The New Agreement will have an initial term of two years, and thereafter
will continue in effect for successive annual periods provided such continuance
is specifically approved at least annually by (i) a majority of the members of
the Fund's Board of Directors who are not parties to the New Agreement, and who
are not "interested persons" (as defined in the 1940 Act) of any such party, and
(ii) a majority of the Fund's Board of Directors or the holders of a "majority
of the outstanding voting securities" (as defined in the 1940 Act) of the Fund.
The New Agreement may be terminated, without penalty, on 60 days' notice, by the
Fund's Board of Directors, by a vote of the holders of a "majority of the
outstanding voting securities" of the Fund, or by Advantage, and the New
Agreement will terminate automatically in the event of its "assignment" (as
defined in the 1940 Act).
Sub-Advisory Fee Information
Under the Fund's current ILFS Agreement, ILFS is paid by Advantage a
monthly fee at an annual rate of 0.20% of the Fund's average net weekly assets.
Under the New Agreement, Advantage India, Inc. will be paid by Advantage a
monthly fee to be agreed upon from time to time by both Advantage and Advantage
India, Inc. that will not exceed an annual rate of 1.10% of the Fund's average
net weekly assets, the fee paid by the Fund to Advantage. Since the fee is paid
by Advantage and not by the Fund, the Fund will not incur any additional
expenses or fees under the terms of or in connection with the New Agreement. The
aggregate amount of the fees paid by Advantage to ILFS for the Fund's fiscal
year ended December 31, 2000 under the ILFS Agreement was $1,353,439.
8
Evaluation by the Board of Directors
At meetings held on October 17, 2000 and February 13, 2001, the Board of
Directors of the Fund reviewed various proposals for alternatives to ILFS. At
the meeting on February 13, 2001, the Board, including a majority of the Board
members who are not "interested persons" (as defined in the 1940 Act) of the
Fund, Advantage, Advantage India, Inc., CIBC World Markets or ILFS, approved the
New Agreement and recommended that the stockholders of the Fund approve such
agreement.
In approving the New Agreement and determining to submit it to
stockholders for their approval, the Board of Directors of the Fund has
determined that it continues to believe having advisory personnel in India is
beneficial to the Fund but that it would be desirable to eliminate the
investment restrictions currently imposed as a result of the government
affiliations of ILFS. In addition, the relationships between CIBC World Markets,
Advantage and Advantage India, Inc. should help assure open and efficient
communications between the Fund's investment manager and the new country
adviser, which should result in better service for the Fund. Specifically,
because of the direct affiliation between Advantage and Advantage India, Inc.,
Advantage anticipates having a more direct presence in India, which should
result in greater access to information generally and more specifically on
potential investment opportunities for the Fund. Further, it is also anticipated
that the staff of Advantage India, Inc. would initially be dedicated solely to
supporting Advantage in its capacity as the Fund's investment manager, which
should also result in better service for the Fund. The Board also considered
that adoption of the New Agreement would not cause the Fund to incur any
additional fees or expenses.
In connection with its review of the New Agreement, the Board of Directors
of the Fund requested and reviewed, with the assistance of its own legal
counsel, materials and information furnished by CIBC World Markets and
Advantage. These materials included information regarding CIBC World Markets and
its personnel, operations and financial condition.
In approving the New Agreement, the Board of Directors of the Fund focused
primarily on the nature, quality and scope of the services provided to date by
ILFS to the Fund and to be performed by Advantage India, Inc., and the fact that
the ILFS Agreement and the New Agreement, including the terms relating to the
services to be performed thereunder by Advantage India, Inc., and the expenses
and fees payable to ILFS and Advantage India, Inc., are substantially similar.
In connection with these primary considerations, comparisons were made between
the New Agreement and similar arrangements by other investment companies,
particularly with regard to levels of fees, and the benefits to Advantage India,
Inc. because of its relationship with the Fund. In particular, the Fund's Board
of Directors considered the commitment of CIBC World Markets to provide capital,
personnel and various resources to Advantage India, Inc. to enable it to provide
high quality services to the Fund.
9
Based upon its review of the above factors, the Board of Directors of the
Fund concluded that the New Agreement is in the best interests of the Fund and
its stockholders. If approved, the New Agreement will take effect promptly
following the Annual Meeting and effectiveness of Advantage India, Inc.'s
registration as an investment adviser.
If the New Agreement is not approved or if Advantage India, Inc. is not
successful in obtaining registration as an investment adviser, the Board of
Directors will consider whether it should take any other action in connection
with seeking any other country adviser for the Fund.
Certain directors and officers of the Fund may have a substantial interest
in the approval of the New Agreement as a result of their interests in Advantage
or affiliates thereof, as described above under "Proposal 1: Election of
Directors."
Required Vote
As provided by the 1940 Act, approval of the New Agreement will require
the affirmative vote of a "majority of the outstanding voting securities" of the
Fund, which means the affirmative vote of the lesser of (a) 67% or more of the
outstanding shares present or represented at the Annual Meeting, if holders of
more than 50% of the outstanding shares of the Fund entitled to vote are present
or represented by proxy at the Annual Meeting, or (b) more than 50% of the
outstanding shares of the Fund entitled to vote.
THE BOARD OF DIRECTORS OF THE FUND, INCLUDING A MAJORITY OF THE DIRECTORS
WHO ARE NOT "INTERESTED PERSONS" (AS DEFINED IN 1940 ACT) OF THE FUND,
ADVANTAGE, ADVANTAGE INDIA, INC., CIBC WORLD MARKETS OR THEIR AFFILIATES,
RECOMMEND THAT THE STOCKHOLDERS OF THE FUND VOTE IN FAVOR OF THE NEW AGREEMENT.
ADDITIONAL INFORMATION
INVESTMENT MANAGEMENT
Advantage Advisers, Inc.
Advantage serves as the Fund's investment manager. The address of
Advantage is One World Financial Center, 200 Liberty Street, New York, New York
10281.
Infrastructure Leasing & Financial Services Limited
ILFS currently serves as the Fund's country adviser. The address of ILFS
is Mahindra Towers, 4th Floor, Dr. G.M. Bhosale Marg, Mumbai, India 400 021.
10
CIBC World Markets
CIBC World Markets serves as the Fund's administrator. The address of CIBC
World Markets is One World Financial Center, 200 Liberty Street, New York, New
York 10281. CIBC World Markets subcontracts certain of its responsibilities to
PFPC Inc. The address of PFPC Inc. is 400 Bellevue Parkway, Wilmington, Delaware
19809.
Multiconsult Ltd.
Multiconsult Ltd. serves as Mauritius administrator to the Fund.
Multiconsult Ltd.'s address is De Chazal Du Mee (DCDM) Building 10, Frere Felix
de Valois Street, Port Louis, Mauritius.
FEES PAID TO INDEPENDENT ACCOUNTANTS
Audit Fees. The aggregate fees paid to PwC in connection with the annual
audit of the Fund and the review of the Fund's financial statements for the
fiscal year ended December 31, 2000 was $117,500.
Financial Information Systems Design and Implementation Fees. There were
no fees billed for information technology services rendered by PwC to the Fund,
Advantage, CIBC World Markets and entities controlled by any of them that
provide services to the Fund for the fiscal year ended December 31, 2000.
All Other Fees. The aggregate fees billed for all other non-audit
services, including fees for tax-related services, rendered by PwC to the Fund,
Advantage, CIBC World Markets and entities controlled by any of them that
provide services to the Fund for the fiscal year ended December 31, 2000 was
$66,435. The Audit Committee has determined that the provision of non-audit
services is compatible with maintaining the independence of PwC.
BROKERAGE COMMISSIONS
For the fiscal year ended December 31, 2000, the Fund paid brokerage
commissions in the amount of $66,176 to ABM-Amro Asia Equities (India) Ltd.
("ABM-Amro"), the Fund's only affiliated broker. This amount represents 5.02% of
the Fund's aggregate brokerage commissions paid during the Fund's most recent
fiscal year. Under the 1940 Act, ABM-Amro is deemed an "affiliated broker" of
the Fund because it is affiliated with ILFS.
OTHER BUSINESS
The Board of Directors of the Fund does not know of any other matter which
may come before the Annual Meeting. If any other matter properly comes before
the Annual Meeting, it is the intention of the persons named in the proxy to
vote the proxies in accordance with their judgment on that matter.
11
PROPOSALS TO BE SUBMITTED BY STOCKHOLDERS
All proposals by stockholders of the Fund which are intended to be
presented at the Fund's next Annual Meeting of Stockholders, to be held in 2002,
must be received by the Fund (addressed to The India Fund, Inc., One World
Financial Center, 200 Liberty Street, New York, New York 10281) for inclusion in
the Fund's proxy statement and proxy relating to that meeting no later than
November 9, 2001. Any stockholder who desires to bring a proposal at the Fund's
2002 Annual Meeting of Stockholders without including such proposal in the
Fund's proxy statement must deliver written notice thereof to the Secretary or
Assistant Secretary of the Fund (addressed to The India Fund, Inc., One World
Financial Center, 200 Liberty Street, New York, New York 10281) during the
thirty-day period from December 21, 2001 to January 19, 2002.
EXPENSES OF PROXY SOLICITATION
The costs of preparing, assembling and mailing material in connection with
this solicitation of proxies will be borne by the Fund. Proxies may also be
solicited personally by officers of the Fund and by regular employees of
Advantage, CIBC World Markets and ILFS or their respective affiliates, or other
representatives of the Fund or by telephone or telegraph, in addition to the use
of mails. Brokerage houses, banks and other fiduciaries may be requested to
forward proxy solicitation material to their principals to obtain authorization
for the execution of proxies, and they will be reimbursed by the Fund for
out-of-pocket expenses incurred in this connection. Corporate Investor
Communications, Inc. ("CIC") has been retained to assist in the solicitation of
proxies at a fee to be paid by the Fund and estimated at approximately $10,000
plus disbursements. If the Annual Meeting is adjourned, an additional fee of
$2,750 for every 15 days that the Annual Meeting is adjourned will be payable to
CIC by the Fund.
March 9, 2001
12
Exhibit A
THE INDIA FUND, INC.
Audit Committee Charter
Statement of Policy
The Audit Committee shall oversee the Fund's accounting and financial
reporting policies and practices and its internal controls. The Audit Committee
shall oversee the quality and objectivity of the Fund's financial statements and
the independent audit of the financial statements. The Audit Committee shall
also act as a liaison between the Fund's independent accountants and the Board
of Directors.
The Audit Committee's role is limited to oversight. Fund management is
responsible for Fund accounting and internal control systems, and the
independent accountants are responsible for conducting a proper audit of the
Fund's financial statements. The independent accountants are ultimately
accountable to the Fund's Board of Directors and the Audit Committee.
Membership
The Audit Committee shall be comprised of as many directors as the Board
of Directors shall determine, but in any event no less than three. No member
shall be an "interested person" of the Fund, as defined in Section 2(a)(19) of
the Investment Company Act of 1940, as amended. In addition, each member of the
Audit Committee shall also meet the requirements of being "Independent," as
defined in the New York Stock Exchange Listed Company Manual ss. 303.01, and
shall be free of any relationship that, in the judgment of the Board of
Directors, may interfere with the exercise of his or her independent judgment.
Each member of the Audit Committee shall be financially literate, as such
qualification is interpreted by the Fund's Board of Directors in its business
judgment under the NYSE listing requirements.
At least one member of the Audit Committee must have accounting or related
financial management expertise, as the Board of Directors interprets such
qualification in its business judgment under the NYSE listing requirements.
Responsibilities and Duties
The Audit Committee policies and procedures shall remain flexible to
facilitate the Audit Committee's ability to react to changing conditions and to
generally discharge its functions. The following responsibilities describe areas
of attention in broad terms.
The Audit Committee shall:
1. Recommend the selection, retention or termination of the Fund's
independent accountants based on an evaluation of their independence and
the nature and performance of the audit and other services. The Audit
Committee and the Board of Directors have the ultimate authority
13
and responsibility to select, evaluate and, where appropriate, replace the
outside auditor (or to nominate the outside auditor to be proposed for
shareholder approval in any proxy statement).
2. Receive on a periodic basis formal written disclosures and letters from
the independent accountants as required by the Independence Standards
Board Standard No. 1.(1)
3. Engage in a dialogue with the independent accountants and the Board of
Directors concerning any relationships between the independent accountants
and the Fund or any other relationships that might adversely affect the
objectivity and independence of the independent accountants.
4. Review the fees charged by the independent accountants for audit and other
services.
5. Review with the independent accountants arrangements for and the scope of
the annual audit and any special audits including the form of any opinion
proposed to be rendered to the Board of Directors and stockholders.
6. Review with management and the independent accountants the annual
financial statements, including a discussion with the independent
accountants of matters required by Statement of Accounting Standards No.
61.(2)
7. Discuss with the independent accountants any matters of concern relating
to the Fund's financial statements.
8. Consider with the independent accountants their comments on the Fund's
accounting and financial reporting policies, practices and internal
controls and management's responses thereto, including the effect on the
Fund of any recommendation of changes in accounting principles or
practices by management or the independent accountants.
9. Investigate any improprieties or suspected improprieties in the Fund's
financial and accounting operations.
10. Provide a report in the Fund's proxy statement disclosing whether the
Audit Committee has fulfilled the duties set forth above in items #2, #3
and #6.
11. Provide a statement whether, based on its review of the Fund's audited
financial statements, the Audit Committee recommends to the Board of
Directors that the audited financial statements be included in the Fund's
Annual Report.
12. Report to the Board of Directors regularly on the Audit Committee's
activities and make any
----------
(1) ISB Standard No. 1 generally requires, among other things, that an auditor
(i) disclose to the Audit Committee, in writing, all relationships between
the auditor and its related entities and the company and its related
entities that in the auditor's professional judgment may reasonably be
thought to bear on independence; (ii) confirm in the letter that, in its
professional judgment, it is independent of the company within the meaning
of the Securities Act of 1933, as amended and the Securities Exchange Act
of 1934; and (iii) discuss the auditor's independence with the audit
committee.
(2) SAS No. 61 ("Communication with Audit Committees") requires independent
auditors to inform the audit committee of certain matters, including among
others, (i) methods used to account for significant unusual transactions,
(ii) the process used by management in formulating sensitive accounting
estimates on the basis of the auditors' conclusion as to the
reasonableness of those estimates and (iii) disagreements with management
over the application of accounting principles.
14
necessary recommendations as to the Fund's accounting and financial
reporting policies, practices and its internal controls.
13. Review and reassess the adequacy of this Charter at least annually and
recommend any changes to the Board of Directors.
14. Review with counsel legal and regulatory matters that have a material
impact on the Fund's financial and accounting reporting policies,
practices or its internal controls.
15. Perform such other functions consistent with this Charter, the Fund's
By-Laws and governing law, as the Audit Committee or the Board of
Directors deems necessary or appropriate.
Meetings
The Audit Committee shall meet at least once annually with the independent
accountants (outside the presence of Fund management) and at least once annually
with the representatives of Fund management responsible for the financial and
accounting operations of the Fund. The Audit Committee shall hold special
meetings when and if circumstances require.
Outside Resources and Assistance from Management
The appropriate officers of the Fund shall provide or arrange to provide
such information, data and services as the Audit Committee may request. The
Audit Committee shall have the authority to discharge its responsibility,
including the authority to retain counsel and other experts and consultants
whose expertise would be considered helpful to the Audit Committee at the
expense of the Fund.
Dated: May 2000
15
Exhibit B
COUNTRY ADVISORY AGREEMENT
Advantage Advisers, Inc.
One World Financial Center
200 Liberty Street
New York, New York 10281
[date], 2001
Advantage India, Inc.
One World Financial Center
200 Liberty Street
New York, New York 10281
Dear Sirs:
This will confirm the agreement among the undersigned (the "Investment
Manager") and you (the "Country Adviser") as follows:
1. The Investment Manager has been employed pursuant to a management
agreement dated as of November 3, 1997 between an investment company (the
"Company") registered under the Investment Company Act of 1940, as amended (the
"1940 Act") and the Investment Manager. The Company engages in the business of
investing and reinvesting its assets in the manner and in accordance with the
investment objective and limitations specified in the Company's Articles of
Incorporation, as amended from time to time in the Registration Statement on
Form N-2, as in effect from time to time, and in such manner and to such extent
as may from time to time be authorized by the Board of Directors of the Company.
Copies of the documents referred to in the preceding sentence have been
furnished to the Country Adviser. Any amendments to these documents shall be
furnished to the Country Adviser.
2. Subject to the approval by the Company, the Investment Manager engages
the Country Adviser on an independent contractor relationship basis, to (a)
provide and procure statistical and factual information and research regarding
economic and political factors and trends in India and its surrounding region,
(b) provide or procure research and statistical data in relation to investing
and other opportunities in India and its surrounding region and (c) provide
assistance in the implementation and coordination of execution of investment
decisions as directed by the Investment Manager. The Country Adviser will not
make any investment decisions with respect to the Company.
3. The Country Adviser shall, at its expense, provide office space, office
facilities and personnel reasonably necessary for performance by it of the
services to be provided by the Country Adviser pursuant to this Agreement.
4. The Country Adviser may contract on its own behalf with or consult with
such banks, other securities firms, brokers or other parties, without additional
expense to the Company, as it may deem appropriate regarding research and
statistical data or otherwise.
16
5. In consideration of the services to be rendered by the Country Adviser
under this agreement, the Investment Manager shall pay the Country Adviser a
monthly fee in United States dollars on the fifth business day of each month for
the previous month as agreed from time to time by the Investment Manager and the
Country Adviser but not to exceed the annual rate of 1.10% of the Fund's average
weekly net assets. If the fee payable to the Investment Adviser pursuant to this
paragraph 5 begins to accrue before the end of any month or if this agreement
terminates before the end of any month, the fee for the period from such date to
the end of such month or from the beginning of such month to the date of
termination, as the case may be, shall be prorated according to the proportion
which such period bears to the full month in which such effectiveness or
termination occurs.
6. The Country Adviser represents and warrants that it will be duly
registered and authorized as an investment adviser under the Investment Advisers
Act of 1940, as amended (the "Advisers Act"), and the Country Adviser agrees to
maintain effective all requisite registrations, authorizations and licenses, as
the case may be, until termination of this Agreement.
7. This agreement shall continue in effect until two years from the date
hereof and shall continue in effect thereafter for successive annual periods,
provided that such continuance is specifically approved at least annually (a) by
the vote of a majority of the Company's outstanding voting securities (as
defined in the 1940 Act) or by the Company's Board of Directors and (b) by the
vote, cast in person at a meeting called for the purpose, of a majority of the
Company's directors who are not parties to this agreement or "interested
persons" (as defined in the 1940 Act) of any such party. Notwithstanding the
above, this Agreement (a) may nevertheless be terminated at any time, without
penalty, by the Company's Board of Directors, by vote of holders of a majority
of the outstanding voting securities (as defined in the 1940 Act) of the Company
or by the Investment Manager, upon 60 days' written notice delivered to each
party hereto, and (b) shall automatically be terminated in the event of its
assignment (as defined in the 1940 Act). Any such notice shall be deemed given
when received by the addressee.
8. Nothing herein shall be deemed to limit or restrict the right of the
Country Adviser, or any affiliate of the Country Adviser, or any employee of the
Country Adviser, to engage in any other business or to devote time and attention
to the management or other aspects of any other business, whether of a similar
or dissimilar nature, or to render services of any kind to any other
corporation, firm, individual or association. Nothing herein shall be construed
as constituting the Country Adviser an agent of the Investment Manager or the
Company.
9. This Agreement shall be governed by the laws of the State of New York;
provided, however, that nothing herein shall be construed as being inconsistent
with the 1940 Act.
10. Notices. Any notice hereunder shall be in writing and shall be
delivered in person or by telex or facsimile (followed by delivery in person) to
the parties at the addresses set forth below.
If to the Country Adviser:
Advantage India, Inc.
One World Financial Center
200 Liberty Street
17
New York, New York 10281
Attn: Barbara Pires
Executive Director
If to the Investment Manager:
Advantage Advisers, Inc.
One World Financial Center
200 Liberty Street
New York, New York 10281
Attn: Bryan McKigney
President
or to such other address as to which the recipient shall have informed the other
party in writing.
Unless specifically provided elsewhere, notice given as provided above
shall be deemed to have been given, if by personal delivery, on the day of such
delivery, and, if by facsimile and mail, on the date on which such facsimile is
sent or mailed.
11. Counterparts. This agreement may be executed in two or more
counterparts, each of which shall be deemed to be an original, but all of which
together shall constitute one and the same instrument.
If the foregoing correctly sets forth the agreement between the Investment
Manager and the Country Adviser, please so indicate by signing and returning to
the Investment Manager the enclosed copy hereof.
Very truly yours,
ADVANTAGE ADVISERS, INC.
By:______________________________________
Name:
Title:
ACCEPTED:
ADVANTAGE INDIA, INC.
By:_________________________________
Name:
Title:
18
DETACH HERE
THE INDIA FUND, INC.
ANNUAL MEETING OF STOCKHOLDERS - APRIL 20, 2001
This Proxy is Solicited on Behalf of the Directors
The undersigned hereby appoints Bryan McKigney, Barbara Pires, Megan
Weilert, and each of them, attorneys and proxies for the undersigned, with full
power of substitution and revocation, to represent the undersigned at the Annual
Meeting of Stockholders of the Fund to be held at One World Financial Center,
New York, New York 10281 on Friday, April 20, 2001, at 1:00 p.m., and at any
adjournments thereof, upon the matters set forth in the Notice of Meeting and
Proxy Statement dated March 9, 2001 and upon all other matters properly coming
before said Meeting.
Please indicate your vote by an "X" in the appropriate box on the reverse
side. This proxy, if properly executed, will be voted in the manner directed by
the stockholder. If no direction is made, this proxy will be voted FOR Proposals
1 and 2 (which includes all nominees for Director). Please refer to the Proxy
Statement for a discussion of the Proposals.
HAS YOUR ADDRESS CHANGED? DO YOU HAVE ANY COMMENTS?
_______________________________________ ____________________________________
_______________________________________ ____________________________________
_______________________________________ ____________________________________
--------------- ---------------
SEE REVERSE (Continued, and to be signed and dated, SEE REVERSE
SIDE on the reverse side.) SIDE
--------------- ---------------
DETACH HERE
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" PROPOSALS 1 and 2
(including all nominees for Director)
1. Election of Directors: 2. The approval of a new country advisory
agreement between Advantage Advisers,
Inc. and Advantage India, Inc.
Nominee (Class II) to serve |_| |_| |_|
until the year 2003 Annual
Meeting: FOR AGAINST ABSTAIN
(01) Howard M. Singer
3. The persons named as proxies are
Nominees (Class III) to serve authorized to vote in their
until the year 2004 Annual discretion on any other business
Meeting: that may properly come before
(02) Bryan McKigney; the Meeting.
(03) Sir Rene Maingard
4. Please mark the box at right
if you plan to attend. |_|
|_| |_|
FOR WITHHOLD AUTHORITY Change of Address and/or Comments
The nominees to vote for the Mark Here |_|
listed above nominees listed
above
Note: Please sign exactly as your name
appears on this Proxy. If joint owners,
EITHER may sign this Proxy. When signing
as attorney, executor, administrator,
trustee, guardian or corporate officer,
please give your full title.
|_| _______________________________
(INSTRUCTION: To withhold authority Please Sign, Date and Return the Proxy
to vote for any individual nominee, Promptly Using the Enclosed Envelope.
write that nominee's name in the
space provided above.)
Signature:_____________ Date:_________ Signature:_______________ Date:_________