-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, NsNMl84gxISaZvjzClmG8OEP1hom5gJXqYZvD/le9HQ18J8/R6Nn0YT7AfgBbh40 sjpclYqJb2ToB80ZYFogrg== 0000927016-02-005845.txt : 20021206 0000927016-02-005845.hdr.sgml : 20021206 20021206155437 ACCESSION NUMBER: 0000927016-02-005845 CONFORMED SUBMISSION TYPE: SC 13D/A PUBLIC DOCUMENT COUNT: 3 FILED AS OF DATE: 20021206 SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: TEMPLETON DRAGON FUND INC CENTRAL INDEX KEY: 0000919893 IRS NUMBER: 650473580 STATE OF INCORPORATION: MD FISCAL YEAR END: 0930 FILING VALUES: FORM TYPE: SC 13D/A SEC ACT: 1934 Act SEC FILE NUMBER: 005-56559 FILM NUMBER: 02851113 BUSINESS ADDRESS: STREET 1: 700 CENTRAL AVE CITY: ST PETERSBURG STATE: FL ZIP: 33701 BUSINESS PHONE: 8138238712 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: PRESIDENT & FELLOWS OF HARVARD COLLEGE CENTRAL INDEX KEY: 0000315016 STANDARD INDUSTRIAL CLASSIFICATION: UNKNOWN SIC - 0000 [0000] IRS NUMBER: 042103580 STATE OF INCORPORATION: MA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D/A BUSINESS ADDRESS: STREET 1: C/O HARVARD MANAGEMENT COMPANY INC STREET 2: 600 ATLANTIC AVENUE CITY: BOSTON STATE: MA ZIP: 02210 BUSINESS PHONE: 6175234400 SC 13D/A 1 dsc13da.txt SCHEDULE 13D AMENDMENT #2 SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 SCHEDULE 13D (Rule 13d-1) INFORMATION TO BE INCLUDED IN STATEMENTS FILED PURSUANT TO RULE 13d-1(a) AND AMENDMENTS THERETO FILED PURSUANT TO RULE 13d-2(a) (Amendment No. 2) Templeton Dragon Fund, Inc. - -------------------------------------------------------------------------------- (Name of Issuer) Common Stock, $0.01 par value - -------------------------------------------------------------------------------- (Title of Class of Securities) 88018T101 - -------------------------------------------------------------------------------- (CUSIP Number) COPY TO: Michael Pradko Timothy W. Diggins, Esq. Harvard Management Company, Inc. Ropes & Gray 600 Atlantic Avenue One International Place Boston, MA 02210 Boston, MA 02110 (617) 523-4400 (617) 951-7389 (Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications) December 6, 2002 - -------------------------------------------------------------------------------- (Date of Event Which Requires Filing of This Statement) If the filing person has previously filed a statement on Schedule 13G to report the acquisition which is the subject of this Schedule 13D, and is filing this schedule because of Rule 13d-1(e), 13d-1(f) or 13d-1(g), check the following box: |X|. Page 1 of 8 Pages SCHEDULE 13D - ------------------- ----------------- CUSIP No. 88018T101 Page 2 of 8 Pages - ------------------- ----------------- - -------------------------------------------------------------------------------- 1. NAME OF REPORTING PERSON S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON President and Fellows of Harvard College - -------------------------------------------------------------------------------- (a) [_] 2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (b) [_] - -------------------------------------------------------------------------------- 3. SEC USE ONLY - -------------------------------------------------------------------------------- 4. SOURCE OF FUNDS* WC - -------------------------------------------------------------------------------- CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS 5. REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e) [_] - -------------------------------------------------------------------------------- 6. CITIZENSHIP OR PLACE OF ORGANIZATION Massachusetts - -------------------------------------------------------------------------------- 7. SOLE VOTING POWER NUMBER OF 6,216,250 SHARES BENEFICIALLY --------------------------------------------------- OWNED BY EACH 8. SHARED VOTING POWER REPORTING ---- PERSON WITH --------------------------------------------------- 9. SOLE DISPOSITIVE POWER 6,216,250 --------------------------------------------------- 10. SHARED DISPOSITIVE POWER ---- - -------------------------------------------------------------------------------- 11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 6,216,250 - -------------------------------------------------------------------------------- CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (9) EXCLUDES [_] 12. CERTAIN SHARES* - -------------------------------------------------------------------------------- 13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (9) 14.0% - -------------------------------------------------------------------------------- 14. TYPE OF REPORTING PERSON* EP - -------------------------------------------------------------------------------- *SEE INSTRUCTIONS BEFORE FILLING OUT! Page 2 of 8 Pages SCHEDULE 13D Templeton Dragon Fund, Inc. Item 1. Security and Issuer. This statement relates to the shares of common stock, $0.01 par value (the "Common Stock"), of Templeton Dragon Fund, Inc. (the "Fund" or "Issuer"), which has its principal executive offices at 700 Central Avenue, St. Petersburg, FL 33701. Item 2. Identity and Background. This statement is filed by President and Fellows of Harvard College ("Harvard"), a Massachusetts educational corporation. The principal executive offices of Harvard are located at c/o Harvard Management Company, 600 Atlantic Avenue, Boston, Massachusetts 02210. Harvard's investment activities are carried on from the offices of Harvard Management Company at 600 Atlantic Avenue, Boston, Massachusetts 02210. Information relating to each of the President, Fellows and executive officers of Harvard is contained in Exhibit A attached hereto and incorporated herein by reference. Each of the President, Fellows and executive officers of Harvard is a citizen of the United States of America. None of Harvard or, to the best of Harvard's knowledge or belief, any of the persons listed in Exhibit A has, during the past five years, been convicted in a criminal proceeding (excluding traffic violations and similar misdemeanors). Neither Harvard, nor to the best of Harvard's knowledge and belief, any of the persons listed in Exhibit A has, during the past five years, been a party to a civil proceeding of a judicial or administrative body of competent jurisdiction and as a result of such proceeding was or is subject to a judgment, decree or final order enjoining future violations of, or prohibiting or mandating activities subject to, federal or state securities laws or finding any violation with respect to such laws. Item 3. Source and Amount of Funds or Other Consideration. Beneficial ownership of the Common Stock of the Fund to which this statement relates was acquired by Harvard with Harvard's general funds. Item 4. Purpose of Transaction. Harvard intends to submit the stockholder proposal set forth in Exhibit B hereto for consideration by the Fund's stockholders at the 2003 annual meeting of stockholders and for inclusion in the Fund's proxy statement relating thereto. The proposal is to terminate the investment management agreement between the Fund and Templeton Asset Management Ltd. This Schedule 13D filing is occasioned by Harvard's intended submission of that stockholder proposal. The securities of the Fund acquired and held by Harvard were acquired in the ordinary course of business and were not acquired for the purpose of or, except as described herein, with the effect of changing or influencing the control of the Fund. Harvard has contacted management of the Fund on several occasions, including in discussions regarding similar matters affecting affiliated funds, to urge management to take substantial steps to enhance shareholder value. Except as described above, Harvard does not have any plans or proposals which relate to or would result in any of the actions set forth in parts (a) through (j) of Item 4. Harvard reserves the Page 3 of 8 Pages right to make any such plans or proposals in the future or to take any other steps to enhance the value of its investment, including without limitation the solicitation of proxies in opposition to management proposals to shareholders, the nomination of candidates to serve as Directors of the Fund, and any other steps Harvard might at the time believe may enhance shareholder value. Harvard would also likely support Board and management proposals that would have the effect of enhancing shareholder value if the Board of Directors and management were to show a commitment to adoption of the proposals. Item 5. Interest in Securities of the Fund. (a),(b) Harvard is the beneficial owner of 6,216,250 shares of Common Stock (approximately 14.0% of the shares of Common Stock). Harvard has sole power to vote and sole power to dispose of such shares to which this Statement relates. (c) Not applicable. (d) Not applicable. (e) Not applicable. Item 6. Contracts, Arrangements, Understandings or Relationships with Respect to the Securities of the Fund. Not applicable. Item 7. Material to be Filed as Exhibits. Exhibit A -- Information concerning the President, Fellows and executive officers of Harvard. Exhibit B -- Stockholder proposal. Page 4 of 8 Pages Signature After reasonable inquiry and to the best of its knowledge and belief, the undersigned certifies that the information set forth in this statement is true, complete and correct. Dated: December 6, 2002 PRESIDENT AND FELLOWS OF HARVARD COLLEGE By: /s/ Michael S. Pradko ----------------------------- Name: Michael S. Pradko Title: Authorized Signatory EXHIBIT INDEX Page Number In Exhibit Sequentially Number Description Numbered Copy - ------ ----------- ------------- A Information Concerning the President, 7 Fellows and executive officers of Harvard B Stockholder proposal 8 Page 6 of 8 Pages EX-99.(A) 3 dex99a.txt INFORMATION CONCERNING THE PRESIDENT EXHIBIT A Directors and Executive Officers The names of the President, Fellows and Executive Officers of Harvard and their business addresses and present principal occupation or employment are set forth below. If no business address is given, the business address of such director or executive officer is c/o Harvard Management Company, Inc., 600 Atlantic Avenue, Boston, Massachusetts 02210. President, Fellows and Executive Officers of Harvard College - ------------------------------------------------------------ Name Office/Position - ---- --------------- Lawrence H. Summers President D. Ronald Daniel Treasurer Mark Goodheart Secretary Hanna H. Gray Fellow Conrad K. Harper Fellow James R. Houghton Fellow Robert E. Rubin Fellow Robert D. Reischauer Fellow Page 7 of 8 Pages EX-99.(B) 4 dex99b.txt STOCKHOLDER PROPOSAL EXHIBIT B Stockholder Proposal "PROPOSAL: That the investment management agreement between the Fund and Templeton Asset Management Ltd. be and hereby is terminated immediately." Statement: President and Fellows of Harvard College is a significant shareholder in the Fund, having held shares continuously since 1998 and currently holding approximately 14.01% of the Fund's outstanding shares. The Fund's shares have long traded at a discount to net asset value. At December 5, 2002, the Fund's discount stood at 12.54%. The weekly average discount to net asset value over the four-year period 12/04/98 to 11/29/02 was 20.54%. We believe that the persistence of the discount is largely the fault of Templeton Asset Management Ltd., the Fund's investment adviser ("Templeton"). Because Templeton has not taken, or caused the Fund to take, aggressive steps to eliminate the discount, we are proposing that the investment management agreement between the Fund and Templeton be terminated. In June 2002, the Fund conducted a tender offer for up to 10% of its shares at a price of 90% of net asset value on the last day of the offer, and in May 2002 announced that it had approved another tender offer for an additional 10% of its shares on the same terms to commence prior to April 30, 2003. In the initial tender offer, 4,364,925.9071 shares were properly tendered, or approximately 9% of the Fund's shares. This response was poor and, we believe, indicative of shareholder sentiment that the offer was undesirable. We believe that the tender offers are too limited in size, and are priced too low, to provide a significant benefit to shareholders or to have any substantial lasting effect on the Fund's discount. Most recently, the Board of Directors of the Templeton China World Fund, Inc. (the "China Fund") which is virtually identical to the Fund's Board -- announced that it had unanimously determined to recommend to shareholders that they vote to open-end that fund, on the basis that open-ending was "in the best interests of [that] Fund and its shareholders" (Filing with Securities and Exchange Commission on Schedule 14A, November 13, 2002). The Board has failed to take similar action for the Templeton Dragon Fund, even though Mark Mobius, the president and portfolio manager of both funds, has described the China Fund as the Dragon Fund's "sister" fund and said the Dragon Fund is a "mirror" of the China Fund. (The Scott Letter: Closed-End Fund Report(C), January 2002 - Volume II, Issue 1, " Sir John Templeton & Dr. Mark Mobius on Emerging Markets" By: George Cole Scott). While it is not clear to Harvard that open-ending either fund is necessarily the optimal approach to enhancing shareholder value, Harvard believes the inconsistency is indicative of the Board's and management's unwillingness to take seriously the desire of shareholders that the Board take immediate, sunstantial steps to eliminate the discount and enhance shareholder value. For these reasons, we are proposing that the investment management agreement between the Fund and Templeton be terminated. Page 8 of 8 Pages -----END PRIVACY-ENHANCED MESSAGE-----