-----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, CR8+sYYDhJ2rbma2vRTsoWkTWEkBcjAU/WX2OZdGn7PNMnG3kRO3YK3ZTjodeKgz z9cuURYbwNeRJqMwgjDoHA== 0001047469-03-018926.txt : 20030515 0001047469-03-018926.hdr.sgml : 20030515 20030515171651 ACCESSION NUMBER: 0001047469-03-018926 CONFORMED SUBMISSION TYPE: PRE 14A PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 20030702 FILED AS OF DATE: 20030515 FILER: COMPANY DATA: COMPANY CONFORMED NAME: PRUDENTIAL US EMERGING GROWTH FUND INC CENTRAL INDEX KEY: 0001022624 STATE OF INCORPORATION: MD FISCAL YEAR END: 1031 FILING VALUES: FORM TYPE: PRE 14A SEC ACT: 1934 Act SEC FILE NUMBER: 811-07811 FILM NUMBER: 03706066 BUSINESS ADDRESS: STREET 1: 199 WATER STREET CITY: NEW YORK STATE: NY ZIP: 10292 BUSINESS PHONE: 2122141250 FORMER COMPANY: FORMER CONFORMED NAME: PRUDENTIAL EMERGING GROWTH FUND INC DATE OF NAME CHANGE: 19961029 FORMER COMPANY: FORMER CONFORMED NAME: PRUDENTIAL SELECTED GROWTH FUND INC DATE OF NAME CHANGE: 19960913 FORMER COMPANY: FORMER CONFORMED NAME: PRUDENTIAL SELECT GROWTH FUND INC DATE OF NAME CHANGE: 19960910 FILER: COMPANY DATA: COMPANY CONFORMED NAME: PRUDENTIAL SECTOR FUNDS INC CENTRAL INDEX KEY: 0000352665 IRS NUMBER: 133071974 STATE OF INCORPORATION: MD FISCAL YEAR END: 1130 FILING VALUES: FORM TYPE: PRE 14A SEC ACT: 1934 Act SEC FILE NUMBER: 811-03175 FILM NUMBER: 03706076 BUSINESS ADDRESS: STREET 1: 199 WATER ST CITY: NEW YORK STATE: NY ZIP: 10292 BUSINESS PHONE: 2122141250 MAIL ADDRESS: STREET 1: ONE SEAPORT PLZ STREET 2: 199 WATER ST CITY: NEW YORK STATE: NY ZIP: 10292 FORMER COMPANY: FORMER CONFORMED NAME: PRUDENTIAL UTILITY FUND INC DATE OF NAME CHANGE: 19950523 FORMER COMPANY: FORMER CONFORMED NAME: PRUDENTIAL BACHE UTILITY FUND INC DATE OF NAME CHANGE: 19920602 FORMER COMPANY: FORMER CONFORMED NAME: PRUDENTIAL BACHE TAX MANAGED UTILITY FUND INC DATE OF NAME CHANGE: 19840910 FILER: COMPANY DATA: COMPANY CONFORMED NAME: PRUDENTIAL INDEX SERIES FUND CENTRAL INDEX KEY: 0000887991 STATE OF INCORPORATION: DE FISCAL YEAR END: 0930 FILING VALUES: FORM TYPE: PRE 14A SEC ACT: 1934 Act SEC FILE NUMBER: 811-06677 FILM NUMBER: 03706079 BUSINESS ADDRESS: STREET 1: 100 MULBERRY ST STREET 2: 9TH FL CITY: NEWARK STATE: NJ ZIP: 07102 BUSINESS PHONE: 8008247513 MAIL ADDRESS: STREET 1: ONE SEAPORT PLZ STREET 2: ONE SEAPORT PLZ CITY: NEW YORK STATE: NY ZIP: 10292 FORMER COMPANY: FORMER CONFORMED NAME: PRUDENTIAL DRYDEN FUND DATE OF NAME CHANGE: 19970620 FORMER COMPANY: FORMER CONFORMED NAME: PRUDENTIAL INSTITUTIONAL FUND DATE OF NAME CHANGE: 19920929 FILER: COMPANY DATA: COMPANY CONFORMED NAME: PRUDENTIAL WORLD FUND INC CENTRAL INDEX KEY: 0000741350 IRS NUMBER: 133204887 STATE OF INCORPORATION: MD FISCAL YEAR END: 1031 FILING VALUES: FORM TYPE: PRE 14A SEC ACT: 1934 Act SEC FILE NUMBER: 811-03981 FILM NUMBER: 03706059 BUSINESS ADDRESS: STREET 1: 100 MULBERRY STREET STREET 2: GATEWAY CENTER 3 9TH FLOOR CITY: NEWARK STATE: NJ ZIP: 07102 BUSINESS PHONE: 9733677530 MAIL ADDRESS: STREET 1: ONE SEAPORT PLZ STREET 2: ONE SEAPORT PLZ CITY: NEW YORK STATE: NY ZIP: 10292 FORMER COMPANY: FORMER CONFORMED NAME: PRUDENTIAL GLOBAL FUND INC DATE OF NAME CHANGE: 19920703 FORMER COMPANY: FORMER CONFORMED NAME: PRUDENTIAL BACHE GLOBAL FUND INC DATE OF NAME CHANGE: 19911230 FILER: COMPANY DATA: COMPANY CONFORMED NAME: PRUDENTIAL TAX MANAGED SMALL CAP FUND INC CENTRAL INDEX KEY: 0001032903 STATE OF INCORPORATION: MD FISCAL YEAR END: 0331 FILING VALUES: FORM TYPE: PRE 14A SEC ACT: 1934 Act SEC FILE NUMBER: 811-08167 FILM NUMBER: 03706069 BUSINESS ADDRESS: STREET 1: GATEWAY CENTER 3 CITY: NEWARK STATE: NJ ZIP: 07102 BUSINESS PHONE: 2013677530 MAIL ADDRESS: STREET 1: GATEWAY CENTER 3 CITY: NEWARK STATE: NJ ZIP: 07102 FORMER COMPANY: FORMER CONFORMED NAME: PRUDENTIAL SMALL CAP QUANTITATIVE FUND INC DATE OF NAME CHANGE: 19970211 FILER: COMPANY DATA: COMPANY CONFORMED NAME: PRUDENTIAL SMALL CO FUND INC CENTRAL INDEX KEY: 0000318531 IRS NUMBER: 133040042 STATE OF INCORPORATION: MD FISCAL YEAR END: 0930 FILING VALUES: FORM TYPE: PRE 14A SEC ACT: 1934 Act SEC FILE NUMBER: 811-03084 FILM NUMBER: 03706074 BUSINESS ADDRESS: STREET 1: 100 MULBERRY ST CITY: NEWARK STATE: NJ ZIP: 07102 BUSINESS PHONE: 2122141250 MAIL ADDRESS: STREET 1: ONE SEAPORT PLZ STREET 2: 199 WATER ST CITY: NEW YORK STATE: NY ZIP: 10292 FORMER COMPANY: FORMER CONFORMED NAME: PRUDENTIAL SMALL CO VALUE FUND INC DATE OF NAME CHANGE: 19971202 FORMER COMPANY: FORMER CONFORMED NAME: PRUDENTIAL SMALL COMPANIES FUND INC DATE OF NAME CHANGE: 19961216 FORMER COMPANY: FORMER CONFORMED NAME: PRUDENTIAL GROWTH OPPORTUNITY FUND INC DATE OF NAME CHANGE: 19950523 FILER: COMPANY DATA: COMPANY CONFORMED NAME: PRUDENTIAL EQUITY FUND CENTRAL INDEX KEY: 0000356683 IRS NUMBER: 133104589 STATE OF INCORPORATION: MD FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: PRE 14A SEC ACT: 1934 Act SEC FILE NUMBER: 811-03336 FILM NUMBER: 03706080 BUSINESS ADDRESS: STREET 1: 100 MULBERRY STREET CITY: NEWARK STATE: NJ ZIP: 07102 BUSINESS PHONE: 9733677473 MAIL ADDRESS: STREET 1: 100 MULBERRY STREET CITY: NEWARK STATE: NJ ZIP: 07102 FORMER COMPANY: FORMER CONFORMED NAME: PRUDENTIAL BACHE EQUITY FUND INC DATE OF NAME CHANGE: 19920603 FORMER COMPANY: FORMER CONFORMED NAME: CHANCELLOR EQUITY FUND INC DATE OF NAME CHANGE: 19830509 FILER: COMPANY DATA: COMPANY CONFORMED NAME: PRUDENTIAL VALUE FUND CENTRAL INDEX KEY: 0000803191 IRS NUMBER: 133376646 STATE OF INCORPORATION: MA FISCAL YEAR END: 1031 FILING VALUES: FORM TYPE: PRE 14A SEC ACT: 1934 Act SEC FILE NUMBER: 811-04864 FILM NUMBER: 03706065 BUSINESS ADDRESS: STREET 1: 199 WATER ST CITY: NEW YORK STATE: NY ZIP: 10292 BUSINESS PHONE: 2122141250 MAIL ADDRESS: STREET 1: ONE SEAPORT PLZ STREET 2: 199 WATER ST CITY: NEW YORK STATE: NY ZIP: 10292 FORMER COMPANY: FORMER CONFORMED NAME: PRUDENTIAL EQUITY INCOME FUND DATE OF NAME CHANGE: 19920703 FORMER COMPANY: FORMER CONFORMED NAME: PRUDENTIAL BACHE EQUITY INCOME FUND DATE OF NAME CHANGE: 19920102 FILER: COMPANY DATA: COMPANY CONFORMED NAME: PRUDENTIAL NATURAL RESOURCES FUND INC CENTRAL INDEX KEY: 0000816753 IRS NUMBER: 133422833 STATE OF INCORPORATION: MD FISCAL YEAR END: 0531 FILING VALUES: FORM TYPE: PRE 14A SEC ACT: 1934 Act SEC FILE NUMBER: 811-05206 FILM NUMBER: 03706078 BUSINESS ADDRESS: STREET 1: 199 WATER ST CITY: NEW YORK STATE: NY ZIP: 10292 BUSINESS PHONE: 2122142188 MAIL ADDRESS: STREET 1: ONE SEAPORT PLZ STREET 2: ONE SEAPORT PLZ CITY: NEW YORK STATE: NY ZIP: 10292 FORMER COMPANY: FORMER CONFORMED NAME: PRUDENTIAL GLOBAL NATURAL RESOURCES FUND INC DATE OF NAME CHANGE: 19950523 FORMER COMPANY: FORMER CONFORMED NAME: PRUDENTIAL BACHE GLOBAL NATURAL RESOURCES FUND INC DATE OF NAME CHANGE: 19920602 FILER: COMPANY DATA: COMPANY CONFORMED NAME: PRUDENTIAL INVESTMENT PORTFOLIOS INC CENTRAL INDEX KEY: 0000949512 IRS NUMBER: 133851144 STATE OF INCORPORATION: MD FISCAL YEAR END: 0930 FILING VALUES: FORM TYPE: PRE 14A SEC ACT: 1934 Act SEC FILE NUMBER: 811-07343 FILM NUMBER: 03706063 BUSINESS ADDRESS: STREET 1: GC3 100 MULBERRY ST STREET 2: 9TH FL CITY: NEWARK STATE: NJ ZIP: 07102 BUSINESS PHONE: 2122141250 MAIL ADDRESS: STREET 1: ONE SEAPORT PLAZA CITY: NEW YORK STATE: NY ZIP: 10292 FORMER COMPANY: FORMER CONFORMED NAME: PRUDENTIAL JENNISON SERIES FUND INC DATE OF NAME CHANGE: 19960911 FORMER COMPANY: FORMER CONFORMED NAME: PRUDENTIAL JENNISON FUND INC DATE OF NAME CHANGE: 19950906 FILER: COMPANY DATA: COMPANY CONFORMED NAME: PRUDENTIAL REAL ESTATE SECURITIES FUND CENTRAL INDEX KEY: 0001051562 STATE OF INCORPORATION: DE FISCAL YEAR END: 0331 FILING VALUES: FORM TYPE: PRE 14A SEC ACT: 1934 Act SEC FILE NUMBER: 811-08565 FILM NUMBER: 03706062 BUSINESS ADDRESS: STREET 1: GATEWAY CENTER 3, 9TH FL STREET 2: 100 MULBERRY ST CITY: NEWARK STATE: NJ ZIP: 07102-4077 BUSINESS PHONE: 9733677525 MAIL ADDRESS: STREET 1: GATEWAY CENTER 3, 9TH FL STREET 2: 100 MULBERRY ST CITY: NEWARK STATE: NJ ZIP: 07102-4077 FORMER COMPANY: FORMER CONFORMED NAME: PRUDENTIAL REAL ESTATE FUND DATE OF NAME CHANGE: 19971217 FILER: COMPANY DATA: COMPANY CONFORMED NAME: PRUDENTIAL 20/20 FOCUS FUND CENTRAL INDEX KEY: 0001052118 STATE OF INCORPORATION: DE FISCAL YEAR END: 0131 FILING VALUES: FORM TYPE: PRE 14A SEC ACT: 1934 Act SEC FILE NUMBER: 811-08587 FILM NUMBER: 03706052 BUSINESS ADDRESS: STREET 1: GATEWAY CENTER 3, 9TH FLOOR STREET 2: 100 MULBERRY STREET CITY: NEWMAN STATE: NJ ZIP: 07102-4077 BUSINESS PHONE: 9733677525 MAIL ADDRESS: STREET 1: GATEWAY CENTER 3, 9TH FLOOR STREET 2: 100 MULBERRY ST CITY: NEWARK STATE: NJ ZIP: 07102-4077 FORMER COMPANY: FORMER CONFORMED NAME: PRUDENTIAL 20/20 FUND DATE OF NAME CHANGE: 19971230 FILER: COMPANY DATA: COMPANY CONFORMED NAME: PRUDENTIAL TAX MANAGED FUNDS CENTRAL INDEX KEY: 0001070287 STATE OF INCORPORATION: DE FISCAL YEAR END: 1031 FILING VALUES: FORM TYPE: PRE 14A SEC ACT: 1934 Act SEC FILE NUMBER: 811-09101 FILM NUMBER: 03706071 BUSINESS ADDRESS: STREET 1: GATEWAY CENTER 3 9TH FLOOR STREET 2: 100 MULBERRY ST CITY: NEWARK STATE: NJ ZIP: 07102-4077 BUSINESS PHONE: 9733677525 MAIL ADDRESS: STREET 1: GATEWAY CENTER 3 9TH FLOOR STREET 2: 100 MULBERRY ST CITY: NEWARK STATE: NJ ZIP: 07102-4077 FORMER COMPANY: FORMER CONFORMED NAME: PRUDENTIAL TAX MANAGED EQUITY FUND DATE OF NAME CHANGE: 19980911 PRE 14A 1 a2107712zpre14a.txt PRE 14A 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: /X/ Preliminary Proxy Statement / / Confidential, For Use of the Commission Only (as permitted by Rule 14a-6(e)(2)) / / Definitive Proxy Statement / / Definitive Additional Materials / / Soliciting Material Under Rule 14a-12
PRUDENTIAL 20/20 FOCUS FUND PRUDENTIAL EQUITY FUND, INC. PRUDENTIAL INDEX SERIES FUND PRUDENTIAL NATURAL RESOURCES FUND, INC. PRUDENTIAL SECTOR FUNDS, INC. PRUDENTIAL SMALL COMPANY FUND, INC. PRUDENTIAL TAX-MANAGED FUNDS PRUDENTIAL TAX-MANAGED SMALL-CAP FUND, INC. PRUDENTIAL U.S. EMERGING GROWTH FUND, INC. PRUDENTIAL VALUE FUND THE PRUDENTIAL INVESTMENT PORTFOLIOS, INC. PRUDENTIAL REAL ESTATE SECURITIES FUND PRUDENTIAL WORLD FUND, INC. - ---------------------------------------------------------------------------- (Name of Registrant as Specified in Its Charter) N/A - ---------------------------------------------------------------------------- (Name of Person(s)Filing Proxy Statement, if Other Than the Registrant) Payment of Filing Fee (Check the appropriate box): /X/ No fee required. / / Fee computed on table below per Exchange Act Rules 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 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: ------------------------------------------------------------
PRUDENTIAL 20/20 FOCUS FUND PRUDENTIAL EQUITY FUND, INC. PRUDENTIAL INDEX SERIES FUND PRUDENTIAL STOCK INDEX FUND PRUDENTIAL NATURAL RESOURCES FUND, INC. PRUDENTIAL SECTOR FUNDS, INC. PRUDENTIAL FINANCIAL SERVICES FUND PRUDENTIAL HEALTH SCIENCES FUND PRUDENTIAL TECHNOLOGY FUND PRUDENTIAL UTILITY FUND PRUDENTIAL SMALL COMPANY FUND, INC. PRUDENTIAL TAX-MANAGED FUNDS PRUDENTIAL TAX-MANAGED EQUITY FUND PRUDENTIAL TAX-MANAGED SMALL-CAP FUND, INC. PRUDENTIAL U.S. EMERGING GROWTH FUND, INC. PRUDENTIAL VALUE FUND THE PRUDENTIAL INVESTMENT PORTFOLIOS, INC. PRUDENTIAL ACTIVE BALANCED FUND PRUDENTIAL JENNISON EQUITY OPPORTUNITY FUND PRUDENTIAL JENNISON GROWTH FUND PRUDENTIAL REAL ESTATE SECURITIES FUND PRUDENTIAL WORLD FUND, INC. PRUDENTIAL GLOBAL GROWTH FUND PRUDENTIAL INTERNATIONAL VALUE FUND PRUDENTIAL JENNISON INTERNATIONAL GROWTH FUND GATEWAY CENTER THREE 100 MULBERRY STREET NEWARK, NEW JERSEY 07102-4077 ------------------------ IMPORTANT PROXY MATERIALS PLEASE VOTE NOW! [ ], 2003 ------------------------ Dear Shareholder: I am inviting you to vote on several proposals relating to the management and operation of your Fund. A shareholder meeting of each of the Funds identified above is scheduled for July 17, 2003. This package contains information about the proposals and includes materials you will need to vote. The Board of Directors/Trustees of each Fund has reviewed the proposals and has recommended that the proposals be presented to you for consideration. Although the Directors/Trustees have determined that the proposals are in your best interest, the final decision is yours. Shareholders of each Fund are being asked to approve many of the same proposals, so in order to save money for your Fund, one proxy statement has been prepared for all of the Funds listed above. To help you understand the proposals, we are including a section that answers commonly asked questions. The accompanying proxy statement includes a detailed description of each of the proposals relating to your Fund. Please read the enclosed materials carefully and cast your vote. Remember, your vote is extremely important, no matter how large or small your holdings. By voting now, you can help avoid additional costs that are incurred with follow-up letters and calls. TO VOTE, YOU MAY USE ANY OF THE FOLLOWING METHODS: - BY MAIL. Please complete, date and sign your proxy card before mailing it in the enclosed postage-paid envelope. - BY INTERNET. Have your proxy card available. Go to the web site: www.proxyvote.com. Enter your 12-digit control number from your proxy card. Follow the simple instructions found on the web site. - BY TELEPHONE. If your Fund shares are held in your own name, call 1-800-690-6903 toll free. If your Fund shares are held on your behalf in a brokerage account with Prudential Securities Incorporated or another broker, call 1-800-454-8683 toll free. Enter your 12-digit control number from your proxy card. Follow the simple instructions. If you have any questions before you vote, please call us at 1-866-665-7684. We're glad to help you understand the proposals and assist you in voting. Thank you for your participation. /s/ Judy A. Rice Judy A. Rice PRESIDENT IMPORTANT INFORMATION TO HELP YOU UNDERSTAND AND VOTE ON THE PROPOSALS Please read the enclosed proxy statement for a complete description of the proposals. However, as a quick reference, the following questions and answers provide a brief overview of the proposals. Q. WHAT PROPOSALS AM I BEING ASKED TO VOTE ON? A. The purpose of the proxy is to ask you to vote on two proposals: - to elect a new Board of Directors or Trustees, and - to approve amendments to the Articles of Incorporation or Declaration of Trust, as applicable, for your Fund. Q. WHY AM I RECEIVING PROXY INFORMATION FOR A FUND THAT I DO NOT OWN? A. Shareholders of all of the Funds are being asked to approve many of the same proposals, so most of the information that must be included in a proxy statement for your Fund needs to be included in a proxy statement for the other Funds as well. Therefore, in order to save money for your Fund, one proxy statement has been prepared. Q. WHY AM I RECEIVING MORE THAN ONE PROXY STATEMENT OR MAILING? A. You may receive a separate proxy statement for each Fund that you own. Also, if you hold shares in more than one account--for example, in an individual account and in an IRA--you may receive multiple proxy statements. Each proxy card should be voted and returned. Q. ARE YOU RECOMMENDING A NEW BOARD FOR THE FUNDS? A. Yes. The Board of each of the Funds has nominated for election Independent and Interested Directors or Trustees. Most of the nominees already serve as Directors or Trustees on some, but not all of the Funds in the Prudential mutual fund complex. Q. WILL THE PROPOSED CHANGES RESULT IN HIGHER DIRECTORS' OR TRUSTEES' FEES FOR A FUND? A. No. For most of the Funds, the number of Independent Directors or Trustees will decrease. For Prudential Real Estate Securities Fund and Prudential World Fund, Inc., the number of Independent Directors or Trustees of each Fund will increase; however, the aggregate amount of fees paid by each of these Funds will not increase because the same Independent Directors or Trustees have been elected to the American Skandia Funds, which will share in paying the fees. Q. HOW MANY VOTES DO YOU NEED TO APPROVE THESE PROPOSALS? A. We need a plurality (for Prudential 20/20 Focus Fund, Prudential Equity Fund, Inc., Prudential Index Series Fund, Prudential Natural Resources Fund, Inc., Prudential Sector Funds, Inc., Prudential Small Company Fund, Inc., Prudential Tax-Managed Funds, Prudential Tax-Managed Small-Cap Fund, Inc., Prudential U.S. Emerging Growth Fund, Inc., The Prudential Investment Portfolios, Inc., Prudential Real Estate Securities Fund and Prudential World Fund, Inc.), or a majority (for Prudential Value Fund), of votes cast to approve Proposal No. 1. For Proposal No. 2, we need the affirmative vote of a majority of voted shares for each of Prudential 20/20 Focus Fund, Prudential Index Series Fund, Prudential Real Estate Securities Fund and Prudential Tax Managed Funds. For Prudential Value Fund, we need the affirmative vote of two-thirds of the outstanding shares of the Fund. For each of Prudential Equity Fund, Inc., Prudential Natural Resources Fund, Inc., Prudential Sector Funds, Inc.--Prudential Technology Fund, Prudential Health Sciences Fund, Prudential Financial Services Fund, Prudential Utility Fund--Prudential Small Company Fund, Inc., Prudential Tax-Managed Small-Cap Fund, Inc., Prudential U.S. Emerging Growth Fund, Inc., Prudential World Fund, Inc.--Prudential Global Growth Fund, Prudential International Value Fund, Prudential Jennison International Growth Fund--and The Prudential Investment Portfolios, Inc.--Prudential Active Balanced Fund, Prudential Jennison Equity Opportunity Fund and Prudential Jennison Growth Fund, we need the affirmative vote of a majority of the outstanding securities entitled to vote thereon. Q. WHAT IF WE DO NOT HAVE ENOUGH VOTES TO MAKE THIS DECISION BY THE SCHEDULED SHAREHOLDER MEETING DATE? A. If we do not receive sufficient votes to hold the meeting, we or Georgeson Shareholder Communications Inc., a proxy solicitation firm, may contact you by mail or telephone to encourage you to vote. Shareholders should review the proxy materials and cast their vote to avoid additional mailings or telephone calls. If we do not have enough votes to approve the proposals by the time of the joint shareholder meeting at 9:30 a.m. on July 17, 2003, the meeting may be adjourned to permit further solicitation of proxy votes. Q. HAS EACH FUND'S BOARD APPROVED THE PROPOSALS? Yes. Your Fund's Board has approved the proposals and recommends that you vote to approve them. Q. HOW MANY VOTES AM I ENTITLED TO CAST? A. As a shareholder, you are entitled to one vote for each share you own of your Fund on the record date. The record date is May 16, 2003. Q. HOW DO I VOTE MY SHARES? A. You may vote in any of several different ways. You may vote by attending the Meeting scheduled for July 17, 2003, or you can vote your shares by completing and signing the enclosed proxy card, and mailing it in the enclosed postage paid envelope. If you need any assistance, or have any questions regarding a proposal or how to vote your shares, please call Prudential at 1-866-665-7684. You may also vote via the Internet. To do so, have your proxy card available and go to the web site: www.proxyvote.com. Enter your 12-digit control number from your proxy card and follow the instructions found on the web site. Finally, you can vote by telephone. If your Fund shares are held in your own name, call 1-800-690-6903 toll free. If your Fund shares are held on your behalf in a brokerage account with Prudential Securities Incorporated or another broker, call 1-800-454-8683 toll free. Enter your 12-digit control number from your proxy card and follow the simple instructions given. Q. HOW DO I SIGN THE PROXY CARD? A. INDIVIDUAL ACCOUNTS: Shareholders should sign exactly as their names appear on the account registration shown on the card. JOINT ACCOUNTS: Both owners must sign and the signatures should conform exactly to the names shown on the account registration. ALL OTHER ACCOUNTS: The person signing must indicate his or her capacity. For example, a trustee for a trust should include his or her title when he or she signs, such as "Jane Doe, Trustee"; or an authorized officer of a company should indicate his or her position with the company, such as "John Smith, President" underneath the name of the company. The attached proxy statement contains more detailed information about each of the proposals relating to your Fund. Please read it carefully. PRUDENTIAL 20/20 FOCUS FUND PRUDENTIAL EQUITY FUND, INC. PRUDENTIAL INDEX SERIES FUND PRUDENTIAL STOCK INDEX FUND PRUDENTIAL NATURAL RESOURCES FUND, INC. PRUDENTIAL SECTOR FUNDS, INC. PRUDENTIAL FINANCIAL SERVICES FUND PRUDENTIAL HEALTH SCIENCES FUND PRUDENTIAL TECHNOLOGY FUND PRUDENTIAL UTILITY FUND PRUDENTIAL SMALL COMPANY FUND, INC. PRUDENTIAL TAX-MANAGED FUNDS PRUDENTIAL TAX-MANAGED EQUITY FUND PRUDENTIAL TAX-MANAGED SMALL-CAP FUND, INC. PRUDENTIAL U.S. EMERGING GROWTH FUND, INC. PRUDENTIAL VALUE FUND THE PRUDENTIAL INVESTMENT PORTFOLIOS, INC. PRUDENTIAL ACTIVE BALANCED FUND PRUDENTIAL JENNISON EQUITY OPPORTUNITY FUND PRUDENTIAL JENNISON GROWTH FUND PRUDENTIAL REAL ESTATE SECURITIES FUND PRUDENTIAL WORLD FUND, INC. PRUDENTIAL GLOBAL GROWTH FUND PRUDENTIAL INTERNATIONAL VALUE FUND PRUDENTIAL JENNISON INTERNATIONAL GROWTH FUND GATEWAY CENTER THREE 100 MULBERRY STREET NEWARK, NEW JERSEY 07102 ------------------------ NOTICE OF JOINT SPECIAL MEETINGS OF SHAREHOLDERS TO BE HELD ON JULY 17, 2003 ------------------------ TO OUR SHAREHOLDERS: Joint meetings of the shareholders of each of the above-listed Funds (each, a Meeting) will be held at the offices of Prudential Investments LLC (PI), 100 Mulberry Street, Gateway Center Three, 14th Floor, Newark, New Jersey on July 17, 2003 at 9:30 a.m. Eastern Daylight Time. The purpose of the Meetings is to consider and act upon the following proposals: 1. To elect 10 Directors or Trustees. 2. To approve amendments to the Articles of Incorporation or Declaration of Trust, as applicable ("Charters"), for each Fund. The Meeting will be a Special Meeting for each Fund. You are entitled to vote at the Meeting, and at any adjournments thereof, of each Fund in which you owned shares at the close of business on May 16, 2003. If you attend a Meeting, you may vote your shares in person. IF YOU DO NOT EXPECT TO ATTEND THE MEETING, PLEASE COMPLETE, DATE, SIGN AND RETURN EACH ENCLOSED PROXY CARD IN THE ENCLOSED POSTAGE PAID ENVELOPE OR VOTE BY INTERNET OR TELEPHONE. By order of the Boards, /s/ Maria G. Master /s/ Jonathan D. Shain Maria G. Master Jonathan D. Shain SECRETARY FOR SECRETARY FOR PRUDENTIAL 20/20 FOCUS FUND PRUDENTIAL REAL ESTATE SECURITIES FUND PRUDENTIAL EQUITY FUND, INC. PRUDENTIAL WORLD FUND, INC. PRUDENTIAL INDEX SERIES FUND Prudential Global Growth Fund Prudential Stock Index Fund Prudential International Value Fund PRUDENTIAL NATURAL RESOURCES FUND, INC. Prudential Jennison International Growth Fund PRUDENTIAL SECTOR FUNDS, INC. Prudential Financial Services Fund Prudential Health Sciences Fund Prudential Technology Fund Prudential Utility Fund PRUDENTIAL SMALL COMPANY FUND, INC. PRUDENTIAL TAX-MANAGED FUNDS Prudential Tax-Managed Equity Fund PRUDENTIAL TAX-MANAGED SMALL-CAP FUND, INC. PRUDENTIAL U.S. EMERGING GROWTH FUND, INC. PRUDENTIAL VALUE FUND THE PRUDENTIAL INVESTMENT PORTFOLIOS, INC. Prudential Active Balanced Fund Prudential Jennison Equity Opportunity Fund Prudential Jennison Growth Fund
Dated: [ ], 2003. PROXY CARDS FOR YOUR FUND ARE ENCLOSED ALONG WITH THE PROXY STATEMENT. PLEASE VOTE YOUR SHARES TODAY BY SIGNING AND RETURNING THE ENCLOSED PROXY CARDS IN THE POSTAGE PREPAID ENVELOPE PROVIDED. YOU CAN ALSO VOTE YOUR SHARES THROUGH THE INTERNET OR BY TELEPHONE USING THE 12-DIGIT "CONTROL" NUMBER THAT APPEARS ON THE ENCLOSED PROXY CARDS AND FOLLOWING THE SIMPLE INSTRUCTIONS. THE BOARD OF YOUR FUND RECOMMENDS THAT YOU VOTE "FOR" THE NOMINEES AND "FOR" PROPOSAL NO. 2. PRUDENTIAL 20/20 FOCUS FUND PRUDENTIAL EQUITY FUND, INC. PRUDENTIAL INDEX SERIES FUND PRUDENTIAL STOCK INDEX FUND PRUDENTIAL NATURAL RESOURCES FUND, INC. PRUDENTIAL SECTOR FUNDS, INC. PRUDENTIAL FINANCIAL SERVICES FUND PRUDENTIAL HEALTH SCIENCES FUND PRUDENTIAL TECHNOLOGY FUND PRUDENTIAL UTILITY FUND PRUDENTIAL SMALL COMPANY FUND, INC. PRUDENTIAL TAX-MANAGED FUNDS PRUDENTIAL TAX-MANAGED EQUITY FUND PRUDENTIAL TAX-MANAGED SMALL-CAP FUND, INC. PRUDENTIAL U.S. EMERGING GROWTH FUND, INC. PRUDENTIAL VALUE FUND THE PRUDENTIAL INVESTMENT PORTFOLIOS, INC. PRUDENTIAL ACTIVE BALANCED FUND PRUDENTIAL JENNISON EQUITY OPPORTUNITY FUND PRUDENTIAL JENNISON GROWTH FUND PRUDENTIAL REAL ESTATE SECURITIES FUND PRUDENTIAL WORLD FUND, INC. PRUDENTIAL GLOBAL GROWTH FUND PRUDENTIAL INTERNATIONAL VALUE FUND PRUDENTIAL JENNISON INTERNATIONAL GROWTH FUND GATEWAY CENTER THREE 100 MULBERRY STREET NEWARK, NEW JERSEY 07102 ------------------------ PROXY STATEMENT JOINT SPECIAL MEETINGS OF SHAREHOLDERS TO BE HELD ON JULY 17, 2003 ------------------------ This proxy statement is being furnished to holders of shares of all of the above-listed investment companies (each, a Company) and their series (each, a Fund) in connection with the solicitation by their respective Boards of proxies to be used at joint meetings (Meetings) of shareholders to be held at Gateway Center Three, 100 Mulberry Street, 14th Floor, Newark, New Jersey 07102 on July 17, 2003, at 9:30 a.m., Eastern Daylight Time, or any adjournment or adjournments thereof. The Meeting will be a Special Meeting for each Fund. This proxy statement is being first mailed to shareholders on or about [ ], 2003. Each Company is an open-end, management investment company registered under the Investment Company Act of 1940, as amended (the 1940 Act). Each of Prudential Equity Fund, Inc., Prudential Natural Resources Fund, Inc., Prudential Sector Funds, Inc., Prudential Small Company Fund, Inc., Prudential Tax-Managed Small-Cap Fund, Inc., Prudential U.S. Emerging Growth Fund, Inc., The Prudential Investment Portfolios, Inc. and Prudential World Fund, Inc. is organized as a Maryland corporation. Prudential Value Fund is organized as a Massachusetts business trust. Each of Prudential 20/20 Focus Fund, Prudential Index Series Fund, Prudential Real Estate Securities Fund and Prudential Tax-Managed Funds is organized as a Delaware statutory trust. The shares of common stock of each of Prudential Equity Fund, Inc., Prudential Natural Resources Fund, Inc., Prudential Sector Funds, Inc., Prudential Small Company Fund, Inc., Prudential Tax-Managed Small-Cap Fund, Inc., Prudential U.S. Emerging Growth Fund, Inc., The Prudential Investment Portfolios, Inc. and Prudential World Fund, Inc. and the shares of beneficial interest of Prudential Value Fund, Prudential 20/20 Focus Fund, Prudential Index Series Fund, Prudential Real Estate Securities Fund and Prudential Tax-Managed Funds are referred to as "Shares," the holders of the Shares are "Shareholders," each Company's board of directors or trustees is referred to as a "Board" and the directors or trustees are "Board Members" or may be collectively referred to as "Directors". A listing of the formal name for each Company and Fund and the abbreviated name for each Company and Fund that is used in this proxy statement are set forth below.
ABBREVIATED COMPANY AND FUND NAME NAME - --------------------- --------------------------------- Prudential 20/20 Focus Fund.............................. 20/20 Prudential Equity Fund, Inc.............................. Equity Prudential Index Series Fund............................. Index Series Prudential Stock Index Fund.......................... INDEX SERIES Stock Index Prudential Natural Resources Fund, Inc................... Natural Resources Prudential Sector Funds, Inc............................. Sector Funds Prudential Financial Services Fund................... SECTOR FUNDS Financial Services Prudential Health Sciences Fund...................... SECTOR FUNDS Health Sciences Prudential Technology Fund........................... SECTOR FUNDS Technology Prudential Utility Fund.............................. SECTOR FUNDS Utility Prudential Small Company Fund, Inc....................... Small Company Prudential Tax-Managed Funds............................. Tax Managed Prudential Tax-Managed Equity Fund................... TAX MANAGED Tax Equity Prudential Tax-Managed Small-Cap Fund, Inc............... Small Cap Prudential U.S. Emerging Growth Fund, Inc................ Emerging Growth Prudential Value Fund.................................... Value The Prudential Investment Portfolios, Inc................ PIP Prudential Active Balanced Fund...................... PIP Active Balanced Prudential Jennison Equity Opportunity Fund.......... PIP Equity Opportunity Prudential Jennison Growth Fund...................... PIP Growth Prudential Real Estate Securities Fund................... Real Estate Prudential World Fund, Inc............................... World Prudential Global Growth Fund........................ WORLD Global Growth Prudential International Value Fund.................. WORLD International Value Prudential Jennison International Growth Fund........ WORLD International Growth
Prudential Investments LLC (PI or the Manager), Gateway Center Three, 100 Mulberry Street, Newark, New Jersey 07102, serves as the Funds' Manager under a management agreement with each Fund. Investment advisory services have been provided to the Funds by PI through its two affiliates, Jennison Associates LLC (Jennison) and Prudential Investment Management, Inc. (PIM). Jennison is located at 466 Lexington Avenue, New York, New York 10017. It serves as subadviser to 20/20, Equity, Natural Resources, Sector Funds, Small Company, Emerging Growth, PIP Equity Opportunity and PIP Growth and Value, WORLD Global Growth and WORLD International Growth. PIM is located at Gateway Center Two, 100 Mulberry Street, Newark, New Jersey 07102. PIM serves as subadviser to Index Series, Tax Managed, Small Cap, and PIP Active Balanced. Until June [ ], 2003, PIM also subadvised a portion of the assets of Sector Funds. In addition, Equity is also subadvised by GE Asset Management, Incorporated (GEAM) and Salomon Brothers Asset Management Inc. (SaBAM). GEAM is located at 3003 Summer Street, Stamford, Connecticut 06904. SaBAM is located at 399 Park Avenue, New York, New York 10022. Real Estate is subadvised by Wellington Management Company, LLP (Wellington). Its address is located at 75 State Street, Boston, Massachusetts 02109. WORLD International Value is 2 subadvised by Bank of Ireland Asset Management (U.S.) Limited (BIAM (U.S.) Limited). Its address is located at 75 Holly Hill Lane, Greenwich, Connecticut 06830. Each Fund has a Board of Directors or Trustees that, in addition to overseeing the actions of the Fund's Manager and Subadvisers, decides upon matters of general policy. VOTING INFORMATION In the case of all of the Companies, except for 20/20, Index Series, Tax Managed, Real Estate, Small Cap and Emerging Growth, the presence, in person or by proxy, of a majority of the Shares of a Company outstanding and entitled to vote will constitute a quorum for the transaction of business at the Meeting of that Company. In the case of 20/20, Index Series, Tax Managed and Real Estate, the presence, in person or by proxy, of forty percent (40%) of the Shares of each Company outstanding and entitled to vote will constitute a quorum for the transaction of business at the Meetings of each of these Companies. For each of Small Cap and Emerging Growth, the presence, in person or by proxy, of one-third of the Shares of each Company outstanding and entitled to vote will constitute a quorum for the transaction of business at the Meetings of each of these Companies. If a quorum is not present at a Meeting, or if a quorum is present at that Meeting 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 Meeting to permit further solicitation of proxies. Any adjournment will require the affirmative vote of a majority of those Shares present and entitled to vote at the Meeting in person or by proxy. When voting on a proposed adjournment, the persons named as proxies will vote FOR the proposed adjournment all shares other than those shares as to which they have been directed to vote against a Proposal, in which case, such shares will be voted AGAINST the proposed adjournment with respect to that Proposal. A shareholder 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 and it is otherwise appropriate. If a proxy that is properly executed and returned is accompanied by instructions to withhold authority to vote (an abstention) or represents a broker "non-vote" (that is, a proxy from a broker or nominee indicating that such person has not received instructions from the beneficial owner or other person entitled to vote Shares on a particular matter with respect to which the broker or nominee does not have discretionary power), the Shares represented thereby, with respect to matters to be determined by a majority or plurality of the votes cast on such matters, will be considered present for purposes of determining the existence of a quorum for the transaction of business, but, not being cast, will have no effect on the outcome of such matters. With respect to matters requiring the affirmative vote of a specified percentage of the total Shares outstanding, an abstention or broker non-vote will be considered present for purposes of determining a quorum but will have the effect of a vote against such matters. Accordingly, abstentions and broker non-votes will have no effect on Proposal No. 1 for which the required vote is a plurality, or majority, of the votes cast, but effectively will be a vote against adjournment and against Proposal No. 2, which requires approval of a majority of the outstanding voting securities. The individuals named as proxies on the enclosed proxy cards will vote in accordance with your direction as indicated thereon if your card is received properly executed by you or by your duly appointed agent or attorney-in-fact. If your card is properly executed and you give no voting instructions, your Shares will be voted FOR the nominees named herein for the Board of the Fund to which the proxy card relates and FOR the remaining Proposals described in this proxy statement and referenced on the proxy card. If any nominee for the Company Boards should withdraw or otherwise become unavailable for election, your Shares will be voted in favor of such other nominee or nominees as management may recommend. You may revoke any proxy card by giving another proxy or by letter or telegram revoking the initial proxy. To be effective your revocation must be received by the Company prior to the related Meeting and must indicate your name and account number. In addition, if you attend a Meeting in person you may, if you wish, vote by ballot at that Meeting, thereby canceling any proxy previously given. 3 The close of business on May 16, 2003 has been fixed as the record date for the determination of shareholders entitled to notice of, and to vote at, the Meetings. Information as to the number of outstanding Shares for each Fund as of the record date is set forth below:
FUND CLASS A CLASS B CLASS C CLASS Z TOTAL - ---- ----------- ----------- ----------- ----------- ----------- 20/20.......................... Equity......................... INDEX SERIES Stock Index....... Natural Resources.............. SECTOR FUNDS Financial Services..................... SECTOR FUNDS Health Sciences... SECTOR FUNDS Technology........ SECTOR FUNDS Utility........... Small Company.................. TAX MANAGED Tax Equity......... Small Cap...................... Emerging Growth................ Value.......................... PIP Active Balanced............ PIP Equity Opportunity......... PIP Growth..................... Real Estate.................... WORLD Global Growth............ WORLD International Value...... WORLD International Growth.....
None of the Proposals requires separate voting by class. Shareholders of each Company vote together on Proposal No. 1. Shareholders of each Fund of the Sector Funds, PIP and World vote separately on Proposal No. 2. Each Share of each class is entitled to one vote. To the knowledge of management, the executive officers and Board Members of each Fund, as a group, owned less than 1% of the outstanding Shares of each Fund as of May 16, 2003. A listing of persons who owned beneficially more than 5% of any class of the Shares of a Fund as of May 16, 2003 is contained in Exhibit A. COPIES OF EACH FUND'S MOST RECENT ANNUAL AND SEMI-ANNUAL REPORTS, INCLUDING FINANCIAL STATEMENTS, HAVE PREVIOUSLY BEEN DELIVERED TO SHAREHOLDERS. SHAREHOLDERS OF A FUND MAY OBTAIN WITHOUT CHARGE ADDITIONAL COPIES OF THE FUND'S ANNUAL AND SEMI-ANNUAL REPORTS BY WRITING THE FUND AT GATEWAY CENTER THREE, 100 MULBERRY STREET, 4TH FLOOR, NEWARK, NEW JERSEY 07102, OR BY CALLING 1-800-225-1852 (TOLL FREE). Each full Share of each Fund outstanding is entitled to one vote, and each fractional Share of each Fund outstanding is entitled to a proportionate share of one vote, with respect to each matter to be voted upon by the shareholders of that Fund. Information about the vote necessary with respect to each Proposal is discussed below in connection with each Proposal. Shareholders voting via the Internet should understand that there may be costs associated with electronic access, such as usage charges from Internet access providers and telephone companies that must be borne by the Shareholder. We have been advised that Internet voting procedures that have been made available to you are consistent with the requirements of law. 4 TO ELECT DIRECTORS OR TRUSTEES PROPOSAL NO. 1 DISCUSSION The Board of each Company has nominated the 10 individuals identified below for election to each Company's Board. Pertinent information about each nominee is set forth in the listing below. Each of the nominees has indicated a willingness to serve if elected. All but one of the nominees currently serve as Directors or Trustees on some, but not all, of the funds in the Prudential retail mutual fund complex. The remaining nominee (Mr. Carson) currently does not serve as a Director or Trustee for any of the funds in the Prudential retail mutual fund complex, but serves as a Director of the American Skandia Advisor Funds, Inc. Because many of the other funds within the Prudential retail mutual fund complex are also asking shareholders to elect the same individuals, if the Shareholders of each of these Companies elect each nominee, most of the Companies within the Prudential retail mutual fund complex will be overseen by a common Board. As part of the creation of a common Board, certain individuals currently serving as Directors or Trustees of each Company who have not been nominated for election have announced their intention to resign their positions if Shareholders elect the nominees. Each of the nominees have announced their intention to serve on the Board if elected by Shareholders. Each Company's current Directors or Trustees believes that creating a common Board is in the best interests of each Company. The principal reasons for adding these individuals are: - to bring additional experience and diversity of viewpoints to the Board; - to bring the benefit of experience derived from service on the boards of the other Prudential mutual funds; - to promote continuity on the Board; and - to achieve efficiencies and coordination in operation, supervision and oversight of the Funds which may be derived from having the same individuals serve on the Board of most of the Prudential retail mutual funds. If elected, all nominees will hold office until the earlier to occur of (a) the next meeting of shareholders at which Board Members are elected and until their successors are elected and qualified or (b) until their terms expire in accordance with each Company's retirement policy or (c) until they resign or are removed as permitted by law. Each Company's retirement policy generally calls for the retirement of Directors on December 31 of the year in which they reach the age of 75. Board Members who are not interested persons of a Company (as defined in the 1940 Act) are referred to as Independent Board Members or Independent Directors. Board Members who are interested persons of a Company are referred to as Interested Board Members or Interested Directors. Currently, each Independent Director who serves on the Board of a Company is paid annual fees as set forth below for his or her service on the Board of each Company. Directors' fees are allocated among all of the Funds in a "cluster" based on their proportionate net assets. In addition, an Independent Board Member who serves on the Executive Committee is paid by the Funds in the cluster an annual aggregate fee of $8,000 and an Independent Board Member who chairs the Audit or Nominating Committee is paid by those Funds an annual aggregate fee of $2,000 per Committee. Interested Directors will continue to receive no compensation from any Fund. Board Members will continue to be reimbursed for any expenses incurred in attending meetings and for other incidental expenses. Board fees are reviewed periodically by each Company's Board. 5 None of the nominees is related to another. None of each Company's Independent Directors nor persons nominated to become Independent Directors owns shares of Prudential Financial, Inc. or its affiliates. The business experience and address of each Independent Director nominee and each Interested Director nominee (each a "Nominee"), as well as information regarding their service on other mutual funds in the Prudential mutual fund complex, is as follows: PROPOSED INDEPENDENT DIRECTOR NOMINEES
NUMBER OF PORTFOLIOS IN TERM OF FUND COMPLEX POSITION(S) OFFICE AND OVERSEEN BY HELD WITH LENGTH OF PRINCIPAL OCCUPATION(S) NOMINEE FOR NAME, ADDRESS* AND AGE EACH FUND TIME SERVED DURING PAST 5 YEARS DIRECTOR - ---------------------- -------------------- ---------------- -------------------------- ---------------- David E. A. Carson None -- Director (January 2000 to None (68) May 2000), Chairman People's Bank (January 1999 to December 1 Financial Plaza 1999), Chairman and Chief Second Floor Executive Officer (January Hartford, CT 06103 1998 to December 1998) and President, Chairman and Chief Executive Officer (1983 to December 1997) of People's Bank. Robert E. La Blanc 20/20: None -- President (since 1981) of [77] (69) Equity: None -- Robert E. La Blanc Index Series: None -- Associates, Inc. Natural Resources: -- (telecommunications); None formerly General Partner Sector Funds: None -- at Salomon Brothers and Small Company: None -- Vice- Chairman of Tax Managed: None Continental Telecom. Small Cap: None -- Trustee of Manhattan Emerging Growth: College. None -- Value: None -- PIP: None -- -- Real Estate: Trustee since 2001 World: Director since 1984 OTHER DIRECTORSHIPS** HELD BY NOMINEE NAME, ADDRESS* AND AGE FOR DIRECTOR - ---------------------- -------------------------- David E. A. Carson Director of United (68) Illuminating and UIL People's Bank Holdings, a utility 1 Financial Plaza company, since May 1993. Second Floor Hartford, CT 06103 Robert E. La Blanc Director of Storage (69) Technology Corporation (technology) (since 1979), Chartered Semiconductor Manufacturing, Ltd. (Singapore) (since 1998), Titan Corporation (electronics, since 1995), Computer Associates International, Inc. (since 2002) (software company); Director (since 1999) of First Financial Fund, Inc. and Director (since April 1999) of The High Yield Plus Fund, Inc.
6
NUMBER OF PORTFOLIOS IN TERM OF FUND COMPLEX POSITION(S) OFFICE AND OVERSEEN BY HELD WITH LENGTH OF PRINCIPAL OCCUPATION(S) NOMINEE FOR NAME, ADDRESS* AND AGE EACH FUND TIME SERVED DURING PAST 5 YEARS DIRECTOR - ---------------------- -------------------- ---------------- -------------------------- ---------------- Douglas H. 20/20: Trustee since 1998 Chairman (since February [77] McCorkindale (63) Equity: Director since 1996 2001), Chief Executive Index Series: since 1996 Officer (since June 2000) Trustee and President (since Natural Resources: since 2000 September 1997) of Gannett Director Co. Inc. (publishing and Sector Funds: since 1996 media); formerly Vice Director Chairman (March 1984-May Small Company: since 1996 2000) of Gannett Co. Inc. Director Tax Managed: Trustee since 1998 Small Cap: Director Emerging Growth: since 1997 Director Value: Trustee since 1996 PIP: Director since 1987 Real Estate: None since 1996 World: None -- -- Stephen P. Munn (60) 20/20: Trustee since 1998 Chairman of the Board [72] Equity: Director since 1996 (since 1994) and formerly Index Series: since 1996 Chief Executive Officer Trustee (1988-2001) and President Natural Resources: since 2000 of Carlisle Companies Director Incorporated. Sector Funds: since 1996 Director Small Company: since 1991 Director Tax Managed: Trustee since 1998 Small Cap: Director since 1997 Emerging Growth: since 1996 Director Value: Trustee since 1996 PIP: Director since 1996 Real Estate: None -- World: None -- OTHER DIRECTORSHIPS** HELD BY NOMINEE NAME, ADDRESS* AND AGE FOR DIRECTOR - ---------------------- -------------------------- Douglas H. Director of Gannett McCorkindale (63) Co., Inc., Director of Continental Airlines, Inc. (since May 1993); Director of Lockheed Martin Corp. (aerospace and defense) (since May 2001); Director of The High Yield Plus Fund, Inc. (since 1996). Stephen P. Munn (60) Chairman of the Board (since January 1994) and Director (since 1988) of Carlisle Companies Incorporated (manufacturer of industrial products); Director of Gannett Co., Inc. (publishing and media).
7
NUMBER OF PORTFOLIOS IN TERM OF FUND COMPLEX POSITION(S) OFFICE AND OVERSEEN BY HELD WITH LENGTH OF PRINCIPAL OCCUPATION(S) NOMINEE FOR NAME, ADDRESS* AND AGE EACH FUND TIME SERVED DURING PAST 5 YEARS DIRECTOR - ---------------------- -------------------- ---------------- -------------------------- ---------------- Richard A. Redeker 20/20: Trustee since 1998 Formerly Management [72] (59) Equity: Director since 1993 Consultant of Investmart, Index Series: since 1996 Inc. (August 2001-October Trustee 2001); formerly employee Natural Resources: since 2000 of Prudential Investments Director (October 1996-December Sector Funds: since 1993 1998). Director Small Company: since 1995 Director Tax Managed: Trustee since 1998 Small Cap: Director Emerging Growth: since 1997 Director since 1996 Value: Trustee PIP: Director since 1993 Real Estate: None since 1995 World: None -- -- Robin B. Smith (63) 20/20: Trustee since 1998 Chairman of the Board [69] Equity: Director since 1996 (since January 2003) of Index Series: since 1996 Publishers Clearing House Trustee (direct marketing); Natural Resources: since 1996 formerly Chairman and Director Chief Executive Officer Sector Funds: since 1996 (August 1996-January 2003) Director of Publishers Clearing Small Company: since 1996 House. Director Tax Managed: Trustee since 1998 Small Cap: Director Emerging Growth: since 1997 Director since 1996 Value: Director PIP: Director since 1996 Real Estate: Trustee since 1995 World: Director since 1997 since 1996 OTHER DIRECTORSHIPS** HELD BY NOMINEE NAME, ADDRESS* AND AGE FOR DIRECTOR - ---------------------- -------------------------- Richard A. Redeker (59) Robin B. Smith (63) Director of BellSouth Corporation (since 1992) and formerly Director of Kmart Corporation (retail) (1996-2003).
8
NUMBER OF PORTFOLIOS IN TERM OF FUND COMPLEX POSITION(S) OFFICE AND OVERSEEN BY HELD WITH LENGTH OF PRINCIPAL OCCUPATION(S) NOMINEE FOR NAME, ADDRESS* AND AGE EACH FUND TIME SERVED DURING PAST 5 YEARS DIRECTOR - ---------------------- -------------------- ---------------- -------------------------- ---------------- Stephen Stoneburn (59) 20/20: None -- President and Chief [75] Equity: None -- Executive Officer (since Index Series: None -- June 1996) of Quadrant Natural Resources: -- Media Corp. (a publishing None company); formerly Sector Funds: None -- President (June 1995-June Small Company: None -- 1996) of Argus Integrated Tax Managed: None -- Media, Inc.; Senior Vice Small Cap: None -- President and Managing Emerging Growth: -- Director (January None 1993-1995) of Cowles Value: None -- Business Media and Senior PIP: None -- Vice President of Real Estate: Trustee since 2001 Fairchild Publications, World: Director Inc (1975-1989). since 1996 Clay T. Whitehead (64) 20/20: Trustee since 1998 President (since 1983) of [94] Equity: Director since 1996 National Exchange Inc. Index Series: since 1996 (new business development Trustee firm). Natural Resources: since 1999 Director Sector Funds: since 1996 Director Small Company: since 1996 Director Tax Managed: Trustee since 1998 Small Cap: Director Emerging Growth: since 1997 Director since 1996 Value: Trustee PIP: Director since 1996 Real Estate: Trustee since 1996 World: Director since 1997 since 1984 OTHER DIRECTORSHIPS** HELD BY NOMINEE NAME, ADDRESS* AND AGE FOR DIRECTOR - ---------------------- -------------------------- Stephen Stoneburn (59) None Clay T. Whitehead (64) Director (since 2000) of First Financial Fund, Inc. and Director (since 2000) of The High Yield Plus Fund, Inc.
9 PROPOSED INTERESTED DIRECTOR NOMINEES
NUMBER OF PORTFOLIOS IN TERM OF FUND COMPLEX POSITION(S) OFFICE AND OVERSEEN BY NAME, ADDRESS* AND HELD WITH LENGTH OF PRINCIPAL OCCUPATION(S) NOMINEE FOR AGE EACH FUND TIME SERVED DURING PAST 5 YEARS DIRECTOR - -------------------- ------------- ------------- ------------------------------------ ------------- Judy A. Rice (55) President and Director or President, Chief Executive Officer, [98] Director or Trustee for Chief Operating Officer and Officer- Trustee all Funds, In-Charge (since 2003) of PI; since 2000; formerly various positions to Senior President of Vice President (1992-1999) of all Funds Prudential Securities Incorporated since 2003 (PSI); and various positions to Managing Director (1975-1992) of Salomon Smith Barney; Member of Board of Governors of the Money Management Institute. Robert F. Gunia (56) Vice 20/20: since Executive Vice President and Chief [116] President and 1998 Administrative Officer (since June Director or Equity: since 1999) of PI; Executive Vice Trustee 1996 President and Treasurer (since Index Series: January 1996) of PI; President since 1996 (since April 1999) of Prudential Natural Investment Management Services LLC Resources: (PIMS); Corporate Vice President since 1996 (since September 1997) of The Sector Funds: Prudential Insurance Company of since 1996 America (Prudential); formerly Small Senior Vice President (March Company: 1987-May 1999) of PSI; formerly since 1996 Chief Administrative Officer (July Tax Managed: 1989-September 1996), Director since 1998 (January 1989-September 1996), and Small Cap: Executive Vice President, Treasurer since 1997 and Chief Financial Officer (June Emerging 1987-December 1996) of Prudential Growth: since Mutual Fund Management, Inc. (PMF) 1996 Value: since 1996 PIP: since 1996 Real Estate: since 1997 World: since 1996 OTHER DIRECTORSHIPS** NAME, ADDRESS* AND HELD BY NOMINEE AGE FOR DIRECTOR - -------------------- ------------------------------------ Judy A. Rice (55) None Robert F. Gunia (56) Director (since May 1989) and Treasurer (since 1999) of The Asia Pacific Fund, Inc.
- ------------------------ * Unless otherwise noted, the address of each Nominee is c/o Prudential Investments LLC, Gateway Center Three, 100 Mulberry Street, Newark, NJ 07102. ** This column includes only directorships of companies required to register, or file reports with the Securities and Exchange Commission (the "SEC") under the Securities Exchange Act of 1934 (that is, "public companies") or other investment companies registered under the 1940 Act. 10 The following tables set forth the dollar range of Fund securities held by each Nominee as of December 31, 2002. The tables also include the aggregate dollar range of securities held by each Nominee in all funds in the Fund Complex overseen by that Nominee as of December 31, 2002. SHARE OWNERSHIP TABLE -- INDEPENDENT DIRECTOR NOMINEES
AGGREGATE DOLLAR RANGE OF SECURITIES IN ALL REGISTERED INVESTMENT COMPANIES OVERSEEN BY DOLLAR RANGE OF NOMINEE IN FAMILY NAME OF NOMINEE SECURITIES IN EACH FUND OF INVESTMENT COMPANIES - --------------- ----------------------------------- ----------------------- David E. A. Carson................ None None Robert E. La Blanc................ WORLD Global Growth: Over $100,000 $10,001-$50,000 (Class A) WORLD International Value: $1-$10,000 (Class A) Real Estate: $10,001-$50,000 All other Funds: None Douglas H. McCorkindale........... 20/20: $10,001-$50,000 Over $100,000 Equity: $10,001-$50,000 Natural Resources: $50,001-$100,000 SECTOR FUNDS Utility: $10,001-$50,000 Small Company: $10,001-$50,000 Emerging Growth: $10,001-$50,000 Value: $1-$10,000 PIP Equity Opportunity: $10,001-$50,000 PIP Growth: $10,001-$50,000 All other Funds: None Stephen P. Munn................... 20/20: $10,001-$50,000 Over $100,000 Equity: $10,001-$50,000 INDEX SERIES Stock Index: $1-$10,000 Natural Resources: $10,001-$50,000 SECTOR FUNDS Financial Services: $10,001-$50,000 SECTOR FUNDS Health Sciences: $1-$10,000 SECTOR FUNDS Technology: $1-$10,000 SECTOR FUNDS Utility: $10,001-$50,000 Small Company: $10,001-$50,000 TAX MANAGED Tax Equity: $1-$10,000 Emerging Growth: $10,001-$50,000 Value: $1-$10,000 PIP Active Balanced: $10,001-$50,000 PIP Equity Opportunity: $10,001-$50,000 PIP Growth: $1-$10,000 All other Funds: None
11
AGGREGATE DOLLAR RANGE OF SECURITIES IN ALL REGISTERED INVESTMENT COMPANIES OVERSEEN BY DOLLAR RANGE OF NOMINEE IN FAMILY NAME OF NOMINEE SECURITIES IN EACH FUND OF INVESTMENT COMPANIES - --------------- ----------------------------------- ----------------------- Richard A. Redeker................ Emerging Growth: $50,001-$100,000 Over $100,000 Value: $1-$10,000 PIP Growth: over $100,000 All other Funds: None Robin B. Smith.................... 20/20: $1-$10,000 Over $100,000 Equity: $10,001-$50,000 INDEX SERIES Stock Index: $10,001-$50,000 Natural Resources: $10,001-$50,000 SECTOR FUNDS Financial Services: $1-$10,000 SECTOR FUNDS Health Sciences: $1-$10,000 SECTOR FUNDS Technology: $1-$10,000 SECTOR FUNDS Utility: over $100,000 Small Company: $10,001-$50,000 TAX MANAGED Tax Equity: $1-$10,000 Small Cap: $1-$10,000 Emerging Growth: $1-$10,000 Value: $10,001-$50,000 PIP Active Balanced: $10,001-$50,000 PIP Equity Opportunity: $10,001-$50,000 PIP Growth: $50,001-$100,000 Real Estate: $1-$10,000 WORLD Global Growth: $1-$10,000 WORLD International Value: $10,001-$50,000 WORLD International Growth: $1-$10,000 All other Funds: None Stephen Stoneburn................. WORLD Global Growth: Over $100,000 $10,001-$50,000 All other Funds: None Clay T. Whitehead................. 20/20: $10,001-$50,000 Over $100,000 INDEX SERIES Stock Index: $10,001-$50,000 SECTOR FUNDS Technology: $1-$10,000 PIP Growth: $10,001-$50,000 WORLD International Growth: $1-$10,000 All other Funds: None
12 SHARE OWNERSHIP TABLE -- INTERESTED DIRECTOR NOMINEES
AGGREGATE DOLLAR RANGE OF SECURITIES IN ALL REGISTERED INVESTMENT COMPANIES OVERSEEN BY DOLLAR RANGE OF NOMINEE IN FAMILY OF NAME OF NOMINEE SECURITIES IN EACH FUND INVESTMENT COMPANIES - --------------- ----------------------------------- ---------------------- Robert F. Gunia................... 20/20: $10,001-$50,000 Over $100,000 Equity: $10,001-$50,000 INDEX SERIES Stock Index: $10,001-$50,000 (Class I and Z) SECTOR FUNDS Utility: $1-$10,000 (Class A) $10,001-$50,000 (Class Z) PIP Active Balanced: $1-$10,000 PIP Growth: $1-$10,000 (Class A) $10,001-$50,000 (Class Z) WORLD Global Growth: $1-$10,000 (Class A) $10,001-$50,000 (Class Z) WORLD International Value: $10,001-$50,000 (Class Z) All other Funds: None Judy A. Rice...................... 20/20: $10,001-$50,000 Over $100,000 Equity: $50,001-$100,000 SECTOR FUNDS Utility: over $100,000 Small Company: $10,001-$50,000 PIP Active Balanced: $10,001-$50,000 PIP Growth: over $100,000 WORLD International Value: $1-$10,000 (Class Z) All other Funds: None
None of the Independent Director Nominees, or any member of his/her immediate family, owned beneficially or of record any securities in an investment adviser or principal underwriter of a Fund or a person (other than a registered investment company) directly or indirectly controlling, controlled by, or under common control with an investment adviser or principal underwriter of a Fund as of December 31, 2002. The following table sets forth information describing the aggregate compensation paid by each Fund for each Fund's most recently completed fiscal year and by the Fund Complex for the calendar year ended December 31, 2002 to each of the Nominees for his/her services: COMPENSATION PAID TO INDEPENDENT DIRECTOR NOMINEES
PENSION OR RETIREMENT BENEFITS ESTIMATED NAME OF INDEPENDENT DIRECTOR AGGREGATE COMPENSATION ACCRUED AS PART OF ANNUAL BENEFITS NOMINEE, POSITION(1) FROM EACH FUND FUND EXPENSES UPON RETIREMENT - -------------------- --------------------------------- ------------------- ---------------- David E. A. Carson None None None Robert E. La Blanc -- Director Real Estate: $1,200 None None World: $4,475 TOTAL 2002 COMPENSATION FROM FUND AND NAME OF INDEPENDENT DIRECTOR FUND COMPLEX PAID NOMINEE, POSITION(1) TO NOMINEES - -------------------- ------------------- David E. A. Carson None Robert E. La Blanc -- Director $137,250 (20/77)(3)
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PENSION OR RETIREMENT BENEFITS ESTIMATED NAME OF INDEPENDENT DIRECTOR AGGREGATE COMPENSATION ACCRUED AS PART OF ANNUAL BENEFITS NOMINEE, POSITION(1) FROM EACH FUND FUND EXPENSES UPON RETIREMENT - -------------------- --------------------------------- ------------------- ---------------- Douglas H. McCorkindale(2) -- 20/20: $1,725 None None Director Equity: $2,875 Index Series: $2,525 Natural Resources: $600 Sector Funds: $7,350 Small Company: $1,475 Tax Managed: $1,400 Small Cap: $1,200 Emerging Growth: $1,513 Value: $1,900 PIP: $7,050 Stephen P. Munn -- Director 20/20: $1,725 None None Equity: $2,875 Index Series: $2,633 Natural Resources: $600 Sector Funds: $7,350 Small Company: $1,518 Tax Managed: $1,406 Small Cap: $1,200 Emerging Growth: $1,521 Value: $1,917 PIP: $7,150 Richard A. Redeker -- Director 20/20: $1,725 None None Equity: $2,875 Index Series: $2,903 Natural Resources: $600 Sector Funds: $7,350 Small Company: $1,475 Tax Managed: $1,400 Small Cap: $1,200 Emerging Growth: $1,513 Value: $1,900 PIP: $7,050 Robin B. Smith(2) -- Director 20/20: $1,813 None None Equity: $3,137 Index Series: $2,831 Natural Resources: $1,250 Sector Funds: $7,726 Small Company: $1,479 Tax Managed: $1,416 Small Cap: $1,200 Emerging Growth: $1,579 Value: $1,983 PIP: $7,600 Real Estate: $1,200 World: $4,491 Stephen Stoneburn -- Director Real Estate: $1,200 None None World: $4,609 TOTAL 2002 COMPENSATION FROM FUND AND NAME OF INDEPENDENT DIRECTOR FUND COMPLEX PAID NOMINEE, POSITION(1) TO NOMINEES - -------------------- ------------------- Douglas H. McCorkindale(2) -- $115,000 (18/77)(3) Director Stephen P. Munn -- Director $118,000 (23/72)(3) Richard A. Redeker -- Director $120,500 (23/72)(3) Robin B. Smith(2) -- Director $120,500 (26/69)(3) Stephen Stoneburn -- Director $120,250 (18/75)(3)
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PENSION OR RETIREMENT BENEFITS ESTIMATED NAME OF INDEPENDENT DIRECTOR AGGREGATE COMPENSATION ACCRUED AS PART OF ANNUAL BENEFITS NOMINEE, POSITION(1) FROM EACH FUND FUND EXPENSES UPON RETIREMENT - -------------------- --------------------------------- ------------------- ---------------- Clay T. Whitehead -- Director 20/20: $1,725 None None Equity: $3,475 Index Series: $3,182 Natural Resources: $1,250 Sector Funds: $8,275 Small Company: $1,575 Tax Managed: $1,500 Small Cap: $1,200 Emerging Growth: $1,613 Value: $2,100 PIP: $8,300 Real Estate: $1,200 World: $4,475 TOTAL 2002 COMPENSATION FROM FUND AND NAME OF INDEPENDENT DIRECTOR FUND COMPLEX PAID NOMINEE, POSITION(1) TO NOMINEES - -------------------- ------------------- Clay T. Whitehead -- Director $196,750 (32/94)(3)
- ------------------------ (1) Interested Directors do not receive any compensation from the Companies or the Fund Complex. (2) Although the last column shows the total amount paid to Directors from the Fund Complex during the calendar year ended December 31, 2002, such compensation was deferred at the election of the Directors, in total or in part, under the Company's deferred fee agreements. Including accrued interest and the selected Prudential Fund's rate of return on amounts deferred through December 31, 2002, the total amount of compensation for the year amounted to $58,669 and $67,374 for Mr. McCorkindale and Ms. Smith, respectively. (3) Indicates number of funds/portfolios in Fund Complex (including Funds) to which aggregate compensation relates. The Fund Complex consists of [45] funds and [117] portfolios. If elected, the Directors will hold office generally without limit except that (a) any Director may resign; (b) any Director may be removed by the holders of not less than a majority of the Company's outstanding Shares entitled to vote on the election of Directors or Trustees (or, with respect to 20/20, Index Series, Tax Managed and Real Estate, by the holders of not less than two-thirds of the Company's outstanding Shares entitled to vote on the election of Trustees); and (c) each Company's retirement policy generally calls for the retirement of Directors on December 31 of the year in which they reach the age of 75. In the event of a vacancy on the Board, the remaining Directors will fill such vacancy by appointing another Director, so long as immediately, after such appointment, at least two-thirds of the Directors have been elected by shareholders. The Board of each Company, with the exception of Real Estate and World, is currently composed of three Interested Directors and ten Independent Directors, and met four times during the twelve months ended December 31, 2002. The Board of Real Estate and World is currently composed of three Interested Directors and six Independent Directors and met four times during the twelve months ended December 31, 2002. Each incumbent Director attended each of these meetings, with the exception of Ms. Smith, who attended three meetings. It is expected that the Directors will meet at least four times a year at regularly scheduled meetings. Each Company has an Audit Committee, which is composed entirely of Independent Directors, and normally meets four times a year, or as required, in conjunction with the meetings of the Board of Directors. Among other things, each Fund's Audit Committee has the following responsibilities: - Recommending to the Board of Directors of each Company the selection, retention or termination, as appropriate, of the independent accountants of a Fund. - Reviewing the independent accountants' compensation, the proposed terms of their engagement, and their independence. 15 - Reviewing audited annual financial statements, including any adjustments to those statements recommended by the independent accountants, and any significant issues that arose in connection with the preparation of those financial statements. - Reviewing changes in accounting policies or practices that had or are expected to have a significant impact on the preparation of financial statements. - Generally acting as a liaison between the independent accountants and the Board of Directors. For each Company except Real Estate and World, the members of each Company's Audit and Nominating Committees are Saul K. Fenster, Delayne Dedrick Gold, Douglas H. McCorkindale, W. Scott McDonald, Jr., Thomas T. Mooney, Stephen P. Munn, Richard A. Redeker, Robin B. Smith, Louis A. Weil, III, and Clay T. Whitehead. For Real Estate and World, the members of each Company's Audit and Nominating Committees are Delayne Dedrick Gold, Robert E. La Blanc, Robin B. Smith, Stephen Stoneburn and Clay T. Whitehead. During the twelve months ended December 31, 2002, the Audit Committee of each Company met four times. The firm of PricewaterhouseCoopers LLP (PwC), 1177 Avenue of the Americas, New York, New York 10036, is the independent accountant for each Fund. Each Company's Audit Committee recommended, and the Board of each Company (including a majority of the Independent Directors) approved, the selection of PwC as the Fund's independent accountant for the Fund's current fiscal year. Representatives of PwC are not expected to be present at the Meetings, however, they will have the opportunity to make a statement if they so desire but will not be available during the meeting to respond to appropriate questions. [The Audit Committee intends to review the provision of services rendered for non-audit services as disclosed under "Financial Information Systems Design and Implementation Fees" and "All Other Fees" below to ensure that the services are compatible with maintaining the independence of PwC in its audit of each Fund]. In accordance with Independence Standards Board No. 1, PwC, each Fund's independent accountant for the Fund's most recently completed fiscal year, as indicated above, has confirmed to the Audit Committee that they are independent with respect to each Fund. PwC has confirmed the following information: - AUDIT FEES: The following aggregate fees were billed by PwC for professional services rendered for the audit of each Fund's annual financial statements for their most recently completed fiscal years as indicated below.
FUND FISCAL YEAR END AUDIT FEES - ---- --------------- ---------- 20/20....................................................... 1/31/03 $29,000 Equity...................................................... 12/31/02 $32,500 INDEX SERIES Stock Index.................................... 9/30/02 $29,500 Natural Resources........................................... 5/31/02 $35,000 SECTOR FUNDS Financial Services............................. 11/30/02 $28,000 SECTOR FUNDS Health Sciences................................ 11/30/02 $28,000 SECTOR FUNDS Technology..................................... 11/30/02 $28,000 SECTOR FUNDS Utility........................................ 11/30/02 $34,500 Small Company............................................... 9/30/02 $27,000 TAX MANANGED Tax Equity..................................... 10/31/02 $28,000 Small Cap................................................... 10/31/02 $27,000 Emerging Growth............................................. 10/31/02 $28,000 Value....................................................... 10/31/02 $28,000 PIP Active Balanced......................................... 9/30/02 $28,000 PIP Equity Opportunity...................................... 9/30/02 $28,000 PIP Growth.................................................. 9/30/02 $28,000 Real Estate................................................. 3/31/03 $27,000 WORLD Global Growth......................................... 10/31/02 $39,000 WORLD International Value................................... 10/31/02 $39,000 WORLD International Growth.................................. 10/31/02 $39,000
16 - FINANCIAL INFORMATION SYSTEMS DESIGN AND IMPLEMENTATION FEES: PwC billed no fees for professional services rendered to the Funds for information technology services relating to financial information systems design and implementation for each Fund's most recently completed fiscal year, as indicated above. Similarly, PwC billed no fees for professional services rendered to the Funds' manager, and any entities controlling, controlled by or under common control with the Funds' manager that provide services to the Funds, for information technology services relating to financial information systems design and implementation for each Fund's most recently completed fiscal years, as indicated above. - ALL OTHER FEES: The aggregate fees billed by PwC for services rendered to each Fund, the Fund's Manager and any entity controlling, controlled by or under common control with the Funds' Manager that provides services to the Funds, amounted to approximately $1,485,000 for the calendar year ended December 31, 2002. Nominating Committee members confer periodically and hold meetings as required. The responsibilities of the Nominating Committee include, but are not limited to, recommending to the Board the individuals to be nominated to become Independent Directors. During the twelve months ended December 31, 2002, no Company's Nominating Committees met. The Companies do not have compensation committees. Each Company's Nominating Committee generally will not consider nominees recommended by Shareholders. Information about the number of Board and Committee meetings held during the most recent fiscal year for each Company is included in Exhibit B. Information concerning Company officers is set forth in Exhibit C. REQUIRED VOTE The nominees receiving the affirmative vote of a plurality of the votes cast will be elected, provided a quorum is present. EACH BOARD, INCLUDING ITS INDEPENDENT BOARD MEMBERS, RECOMMENDS THAT YOU VOTE "FOR" EACH OF THE NOMINEES UNDER PROPOSAL NO. 1. 17 TO APPROVE AMENDMENTS TO THE ARTICLES OF INCORPORATION OR DECLARATION OF TRUST FOR EACH COMPANY PROPOSAL NO. 2 THIS PROPOSAL APPLIES TO EACH COMPANY AS DESCRIBED BELOW. BACKGROUND The Board of each Company has approved, submitted for shareholder approval, and recommends that shareholders approve, amendments (collectively, the "Charter Amendments") to each Company's governing documents, which are either a declaration of trust or articles of incorporation, as applicable (either, a "Charter"). Each of the Companies is organized and operates under a state Charter (either Maryland, Massachusetts or Delaware). The chart below identifies the applicable state Charter for each Company.
NAME OF COMPANY JURISDICTION - --------------- ------------ 20/20....................................................... Delaware Equity...................................................... Maryland Index Series................................................ Delaware Natural Resources........................................... Maryland Sector Funds................................................ Maryland Small Company............................................... Maryland Tax Managed................................................. Delaware Small Cap................................................... Maryland Emerging Growth............................................. Maryland Value....................................................... Massachusetts PIP......................................................... Maryland Real Estate................................................. Delaware World....................................................... Maryland
The Charter Amendments are intended to reflect changes to state laws that have occurred over the years, to eliminate unnecessary or unduly burdensome provisions that do not optimally protect the interests of shareholders, to eliminate potential uncertainty regarding the application of certain state laws and to achieve consistent Charter provisions for the Companies in each jurisdiction and, where possible, across jurisdictions. The Board of each Company believes that approval of the Charter Amendments is in the best interests of the Company and its Shareholders, and recommends that shareholders approve the Charter Amendments for their respective Companies. There are certain material differences between the proposed Charter Amendments for each Company and each Company's current Charter. These are summarized in the tables appearing at the end of this Proposal. The text of the proposed Charter Amendments is also included in the tables appearing at the end of this Proposal. Set forth below is a detailed analysis of the proposed Charter Amendments: 1. Charter Amendments. Each Charter would be amended to remove any provisions that could be interpreted to require Shareholder approval for Charter amendments other than for those amendments for which Shareholder vote is specifically required by the 1940 Act or other law, if any, and to give the Board of Directors or Trustees the right to amend the Charter without Shareholder action to the fullest extent permitted by law. THIS AMENDMENT IS INTENDED TO GIVE EACH COMPANY MAXIMUM FLEXIBILITY TO PERMIT AMENDMENT OF ITS CHARTER BY THE BOARD TO ADDRESS ANY FUTURE CIRCUMSTANCES WITHOUT THE NECESSITY OF THE TIME AND EXPENSE OF OBTAINING A SHAREHOLDER VOTE UNLESS SUCH VOTE IS REQUIRED BY THE 1940 ACT OR OTHER LAW. In addition, each Maryland Company Charter would be amended to specifically reserve the Company's right to alter the "contract rights" of outstanding Shares, in order to clarify that the 18 Company is exempt from certain Maryland appraisal rights statutes. UNDER MARYLAND LAW, A SHAREHOLDER MAY BE ENTITLED TO REQUIRE A CORPORATION TO PAY "FAIR VALUE" FOR HER SHARES IF A CHARTER AMENDMENT SUBSTANTIALLY ADVERSELY AFFECTS HER RIGHTS AS A SHAREHOLDER. WE DO NOT BELIEVE ANY OF THE MARYLAND COMPANIES ARE CURRENTLY SUBJECT TO SUCH STATUTES, BECAUSE MARYLAND LAW GENERALLY DENIES APPRAISAL RIGHTS TO SHAREHOLDERS OF PUBLIC COMPANIES AND OF OPEN-END INVESTMENT COMPANIES. HOWEVER, THE BOARD OF DIRECTORS OF EACH MARYLAND COMPANY HAS DETERMINED THAT IT IS IN THE BEST INTEREST OF THE MARYLAND COMPANY AND ITS SHAREHOLDERS TO REDUCE, TO THE EXTENT POSSIBLE, ANY UNCERTAINTY REGARDING THE POTENTIAL APPLICATION OF THE APPRAISAL STATUTES TO THE MARYLAND COMPANIES. Finally, each Maryland Company Charter would be amended to clarify that the Board of Directors, without Shareholder action, can increase or decrease the aggregate number of Shares that the Company has authority to issue. ALTHOUGH WE BELIEVE THAT THE MARYLAND COMPANIES HAVE THIS POWER UNDER MARYLAND LAW, THE BOARD OF DIRECTORS OF EACH MARYLAND COMPANY BELIEVES IT IS IN THE BEST INTEREST OF THE MARYLAND COMPANY TO ELIMINATE ANY POTENTIAL UNCERTAINTY REGARDING THIS AUTHORITY. 2. Redemption Provisions. The Value Charter and the Charter for Index Series would be amended, if necessary, to give the Board of Trustees the authority to redeem Shares for any reason under terms set by the Board of Trustees, including the failure by a Shareholder to provide required information or maintain a minimum required investment. Any such required redemption would be effected at the redemption price, and in accordance with the redemption procedures for voluntary redemptions. The Maryland Company Charters already provide for redemption rights; as permitted by state law, these Company Charters would be amended to allow the redemption consideration to be set at net asset value less any redemption fee or other charge as may be fixed by resolution of the Board. The Delaware Company Charters other than Index Series already provide for redemption of Shares by the Board of Trustees for any reason and will not require amendment. THIS AMENDMENT IS INTENDED TO ALLOW EACH FUND TO BE OPERATED MORE EFFICIENTLY BY PERMITTING REDEMPTION AT THE DISCRETION OF THE BOARD OF TRUSTEES, AND ALLOCATING REDEMPTION COSTS ONLY TO THE AFFECTED SHARES. In addition, each Maryland Company Charter would be amended to clarify that a redemption by such Company, even if it is of all of the outstanding Shares of a fund or class, will not constitute a "liquidation" under Maryland law that would require a Shareholder vote. ALTHOUGH WE BELIEVE THAT THE MARYLAND COMPANIES HAVE AUTHORITY UNDER MARYLAND LAW TO REDEEM ALL SHARES IN A CLASS OR SERIES WITHOUT A SHAREHOLDER VOTE, THE BOARD OF DIRECTORS OF EACH MARYLAND COMPANY BELIEVES IT IS IN THE BEST INTEREST OF THE COMPANY TO ELIMINATE ANY POTENTIAL UNCERTAINTY REGARDING THIS AUTHORITY. 3. Quorum; Action by Shareholders. Each Charter would be amended to provide that a quorum would be one-third of the outstanding Shares of a Company entitled to be cast at a meeting. In addition, the amendment would clearly provide that one-third of all votes entitled to be cast on a specific matter would be sufficient to constitute a quorum for that matter, even if only some of the outstanding classes or Funds are entitled to vote on that matter. In addition, the Value Company Charter would be amended to require a plurality vote in the election of Trustees and would be amended to require that other matters can be approved by a majority of votes cast at a meeting at which a quorum is present, subject in all cases to any higher vote requirements under the 1940 Act or applicable state law. THIS AMENDMENT IS INTENDED TO INCREASE THE LIKELIHOOD THAT A QUORUM WILL BE PRESENT AT ALL SHAREHOLDER MEETINGS TO AVOID THE TIME AND EXPENSE OF CONTINUED SOLICITATION. 4. Number of Trustees. Each Delaware Company Charter and the Value Charter would be amended to provide that the number of Trustees would be as determined pursuant to a written instrument or the By-laws, which generally allow the Trustees to establish the number, without setting any maximum. However, if a maximum is required by applicable law, it would be set at 20 Trustees. THIS AMENDMENT IS INTENDED TO GIVE EACH COMPANY MAXIMUM FLEXIBILITY WITH RESPECT TO THE NUMBER OF TRUSTEES. 19 5. Board Authority to Classify and Reclassify Shares. The Value Charter would specifically authorize the Board of Trustees to classify and reclassify its Shares, to increase the number of Shares available for issuance. THIS AMENDMENT IS INTENDED TO GIVE THIS COMPANY MAXIMUM FLEXIBILITY WITH RESPECT TO THE CLASSIFICATION AND ISSUANCE OF SHARES. 6. Adjournments. The Charter of each Massachusetts Company and the By-Laws of each Delaware Company would be amended to clarify that a meeting of Shareholders may be adjourned by Shareholders holding a majority of the outstanding Shares present and entitled to vote on a proposal to adjourn whether or not a quorum is present. THIS AMENDMENT IS INTENDED TO CLARIFY THE PROCEDURE AND REQUISITE VOTE FOR ADJOURNING SHAREHOLDER MEETINGS AND TO AVOID HAVING TO RE-NOTICE THE MEETING WITH ITS ATTENDANT TIME AND EXPENSE TO THE COMPANY. 7. Derivative Actions. The Value Charter and Index Series Charter would be amended to set forth the requirements for the bringing of a derivative action on behalf of the Company by a Shareholder. Such requirements would include the making of pre-suit demand upon the Trustees by Shareholders who collectively hold at least 10% of the outstanding Shares and the consideration of any Shareholders' pre-suit demand by Independent Trustees. THIS AMENDMENT IS INTENDED TO ALLOW THE VALUE AND INDEX SERIES TO LIMIT LITIGATION ON BEHALF OF THE COMPANY TO THOSE SITUATIONS WHERE IT IS SUPPORTED BY SHAREHOLDERS WITH A MATERIAL STAKE IN THE COMPANY AND TO ADDRESS THE NEED FOR THE EVALUATION OF THE MERITS OF A POTENTIAL LAWSUIT BY INDEPENDENT TRUSTEES. 8. Master/Feeder Transactions; Reorganization. Each Maryland Company Charter and the Value and the Index Series Charters would be amended to permit the Directors or Trustees to invest the property of the Company or any fund thereof in cash or securities of other investment companies. The Value Company Charter would be amended to permit the Trustees to merge, consolidate or sell substantially all of the assets of the Company or a Fund without a shareholder vote. THIS AMENDMENT IS INTENDED TO GIVE EACH COMPANY MAXIMUM FLEXIBILITY REGARDING IMPLEMENTING A MASTER/FEEDER STRUCTURE, AND TO ALLOW THE BOARD OF TRUSTEES TO REORGANIZE THE VALUE COMPANY. 9. Shareholder Voting. The Charters for the Value and Index Series would be amended to permit dollar based voting by the Shareholders. The provision would provide that with respect to each matter submitted to a Shareholder vote, the Trustees could determine whether the Shareholder vote would be done on a per Share basis or net asset value basis. Maryland Company Charters that consist of funds would be amended to require dollar based voting by the Shareholders. The general effect of the dollar-based voting is that it allocates Shareholder voting power in proportion to the value of each Shareholder's investment, rather than the number of Shares held. This will result in a fairer allocation of voting power by increasing the voting power of investors holding Shares with higher net asset values so as to match the level of their investment. In addition, the Value Company and each Delaware Company Charter would be amended to limit the requirement of a Shareholder vote to the election and removal of Directors or Trustees and to additional matters as to which Shareholder approval is required under the 1940 Act. THIS AMENDMENT IS INTENDED TO GIVE THE VALUE AND INDEX SERIES MAXIMUM FLEXIBILITY REGARDING THE APPLICABILITY OF SHAREHOLDER VOTING, TO MORE FAIRLY ALLOCATE VOTING POWER FOR MARYLAND COMPANIES WITH FUNDS, AND TO REDUCE THE NEED TO CALL SHAREHOLDERS' MEETINGS AND THE ATTENDANT EXPENSE TO THE COMPANIES. 10. Termination of Company, Fund or Class. The Value and each Delaware Company Charter would be amended to provide that the Trustees would have the authority to dissolve the Company or any Fund or class without Shareholder approval. The Value Fund Charter would also be amended to reduce 20 the required Shareholder vote for a termination of this Company or any Fund when that termination is recommended by the Trustees from a vote of two-thirds of the Shares to a majority of the Shares. THIS AMENDMENT IS INTENDED TO ALLOW THE TRUSTEES TO LIQUIDATE THE COMPANY OR ANY SERIES AND TO DISTRIBUTE ANY NET ASSETS TO SHAREHOLDERS WITHOUT FIRST OBTAINING A SHAREHOLDER VOTE. 11. Election of Trustees. The Value and each Delaware Company Charter would be amended to provide that the calling of a Shareholders' meeting for the election of Trustees when less than a majority of Trustees holding office had been elected by the Shareholders would only be required to the extent that the calling of such a meeting was required under the 1940 Act. THIS AMENDMENT IS INTENDED TO REDUCE THE NEED TO CALL SHAREHOLDERS' MEETINGS FOR THE ELECTION OF TRUSTEES AND THE ATTENDANT EXPENSE TO THE COMPANIES. 12. Indemnification and Limited Liability. The Maryland Company Charters would be amended to provide for uniform indemnification (including advancement of expenses) of each Company's current and former Directors and officers to the full extent required or permitted by law, and for other employees and agents to the extent authorized by the Board of Directors or the Company's By-laws and as permitted by law, and also to provide uniform limitation on the liability of Directors and officers for monetary damages. The Charter for each of Natural Resources and World would also be amended to provide that Directors and officers will not be liable to the Company or its shareholders for monetary damages for breach of fiduciary duty, to the extent permitted by law. Pursuant to Maryland law, this provision specifically does NOT protect a Director or officer from liability for (a) receipt of an improper benefit or profit or (b) active and deliberate dishonesty. THIS AMENDMENT IS INTENDED TO ENSURE THAT THE MARYLAND COMPANY CHARTERS ARE CONSISTENT WITH EACH OTHER AND RELEVANT MARYLAND LAW. IN ADDITION, WE BELIEVE THESE PROVISIONS WILL ENABLE THE MARYLAND COMPANIES TO ATTRACT AND RETAIN THE MOST HIGHLY QUALIFIED PERSONNEL. DELAWARE SUMMARY AND TEXT OF CHARTER AMENDMENTS
DECLARATION OF TRUST AMENDMENTS QUORUM ---------------------------------------------- ---------------------------------------------- COMPANY EXISTING PROVISION PROPOSED AMENDMENT EXISTING PROVISION PROPOSED AMENDMENT - ------- ---------------------- ---------------------- ---------------------- ---------------------- 20/20 A vote of shareholders The Trustees would The quorum requirement The quorum requirement is required for have authority to is 40% of the shares would be one-third of amendments that approve all amendments entitled to vote at a the shares entitled to (i) affect the voting for routine and non- meeting, except when a vote at a meeting, rights of routine matters other larger quorum is except when a larger shareholders, than those matters required by applicable quorum is required by (ii) amend the that are required to law, the Declaration the 1940 Act, the amendment provision of be approved by or the By- Laws. Declaration or the the Declaration, shareholders under the By-Laws. (iii) are required to 1940 Act. be approved by shareholders under applicable law, and (iv) are submitted to the shareholders by the Trustees.
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REDEMPTION NUMBER OF TRUSTEES ---------------------------------------------- ---------------------------------------------- COMPANY EXISTING PROVISION PROPOSED AMENDMENT EXISTING PROVISION PROPOSED AMENDMENT - ------- ---------------------- ---------------------- ---------------------- ---------------------- 20/20 None. The number of Trustees The number of Trustees shall at all times be would be such number at least one and no as is determined by more than 15, as the Trustees from time determined by the to time but at least Trustees from time to one. time.
ADJOURNMENTS DERIVATIVE ACTIONS ---------------------------------------------- ---------------------------------------------- COMPANY EXISTING PROVISION PROPOSED AMENDMENT EXISTING PROVISION PROPOSED AMENDMENT - ------- ---------------------- ---------------------- ---------------------- ---------------------- 20/20 The existing By-Laws Shareholders holding a None. do not contain an majority of the express provision outstanding shares regarding the present and entitled requirements for to vote on adjournment adjournment of a of a meeting would shareholders' meeting. have authority to adjourn a shareholders meeting whether or not a quorum is present at the meeting.
MASTER/FEEDER TRANSACTIONS SHAREHOLDER VOTING ---------------------------------------------- ---------------------------------------------- COMPANY EXISTING PROVISION PROPOSED AMENDMENT EXISTING PROVISION PROPOSED AMENDMENT - ------- ---------------------- ---------------------- ---------------------- ---------------------- 20/20 None. Shareholders have the Shareholders would power to vote for the have the power to vote election and removal for the election and of Trustees and such removal of Trustees additional Company and such additional matters as may be Company matters as may required by applicable be required by the law. 1940 Act.
TERMINATION OF COMPANY, FUND OR CLASS ELECTION OF TRUSTEES ---------------------------------------------- ---------------------------------------------- COMPANY EXISTING PROVISION PROPOSED AMENDMENT EXISTING PROVISION PROPOSED AMENDMENT - ------- ---------------------- ---------------------- ---------------------- ---------------------- 20/20 The Company and any The Company and any If less than the If less than the Fund or Class of Fund or Class of majority of Trustees majority of Trustees shares may be shares may be holding office have holding office have dissolved at any time dissolved at any time been elected by been elected by by vote of a majority by the Trustees shareholders, a shareholders, a of the shares of each without shareholder shareholders' meeting shareholders' meeting Fund entitled to vote, approval. for the election must for the election of voting separately by be called for the Trustees would be Fund, or by the election of Trustees. called to the extent Trustees by written it is required by the notice to the 1940 Act. shareholders.
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DECLARATION OF TRUST AMENDMENTS QUORUM ---------------------------------------------- ---------------------------------------------- COMPANY EXISTING PROVISION PROPOSED AMENDMENT EXISTING PROVISION PROPOSED AMENDMENT - ------- ---------------------- ---------------------- ---------------------- ---------------------- Index Series A vote of shareholders The Trustees would The quorum requirement The quorum requirement is required for have authority to is 40% of the shares would be one-third of amendments that approve all amendments entitled to vote at a the shares entitled to (i) affect the voting for routine and non- meeting, except when a vote at a meeting rights of routine matters other larger quorum is except when a larger shareholders, than those matters required by applicable quorum is required by (ii) amend the that are required to law, the Declaration the 1940 Act, the amendment provision of be approved by or the By- Laws. Declaration or the the Declaration, shareholders under the By-Laws. (iii) are required to 1940 Act. be approved by shareholders under applicable law, and (iv) are submitted to the shareholders by the Trustees.
REDEMPTION NUMBER OF TRUSTEES ---------------------------------------------- ---------------------------------------------- COMPANY EXISTING PROVISION PROPOSED AMENDMENT EXISTING PROVISION PROPOSED AMENDMENT - ------- ---------------------- ---------------------- ---------------------- ---------------------- Index Series The Trustees have the The Trustees would The number of Trustees The number of Trustees authority to redeem have the authority to shall at all times be would be such number shares of any person redeem the shares of at least two and no as is determined by at net asset value to any Shareholder or more than 15, as the Trustees from time the extent that the group of Shareholders determined by the to time but at least direct or indirect (including some or all Trustees from time to one. ownership of shares of the shareholders of time. has or may become any Fund or Class) for concentrated in such any reason at net person to an extent asset value, less any that would disqualify redemption fees, and any Fund of shares as upon such other terms an investment company. set by the Trustees.
ADJOURNMENTS DERIVATIVE ACTIONS ---------------------------------------------- ---------------------------------------------- COMPANY EXISTING PROVISION PROPOSED AMENDMENT EXISTING PROVISION PROPOSED AMENDMENT - ------- ---------------------- ---------------------- ---------------------- ---------------------- Index Series The existing By-Laws Shareholders holding a The existing Shareholders would be do not contain an majority of the Declaration does not permitted to bring a express provision outstanding shares contain an express derivative action on regarding the present and entitled provision regarding behalf of the Company requirements for to vote on adjournment derivative actions. if certain adjournment of a of a meeting would requirements are shareholders' meeting. have authority to satisfied, including adjourn a shareholders the making of a meeting whether or not pre-suit demand upon a quorum is present at the Trustees by the meeting. shareholders who collectively hold at least 10% of the outstanding shares of the Company and the consideration of any such pre-suit demand by independent Trustees.
23
MASTER/FEEDER TRANSACTIONS SHAREHOLDER VOTING ---------------------------------------------- ---------------------------------------------- COMPANY EXISTING PROVISION PROPOSED AMENDMENT EXISTING PROVISION PROPOSED AMENDMENT - ------- ---------------------- ---------------------- ---------------------- ---------------------- Index Series The existing The Trustees would be Shareholders have the Shareholders would Declaration does not permitted to invest power to vote for the have the power to vote contain an express the property of the election and removal for the election and provision regarding Company or any Fund of Trustees and such removal of Trustees the Trustees' thereof in other additional Company and such additional authority with respect investment companies matters as may be Company matters as may to master/feeder without shareholder required by applicable be required by the transactions. approval unless such law. Shareholders are 1940 Act. Shareholders approval is required entitled to vote on a would be entitled to by the 1940 Act. per share basis as vote on a per share determined by the basis or net asset Trustees. value basis.
TERMINATION OF COMPANY, FUND OR CLASS ELECTION OF TRUSTEES ---------------------------------------------- ---------------------------------------------- COMPANY EXISTING PROVISION PROPOSED AMENDMENT EXISTING PROVISION PROPOSED AMENDMENT - ------- ---------------------- ---------------------- ---------------------- ---------------------- Index Series The Company and any The Company and any If less than the If less than the Fund or Class of Fund or Class of majority of Trustees majority of Trustees shares may be shares may be holding office have holding office have dissolved at any time dissolved at any time been elected by been elected by by vote of a majority by the Trustees shareholders, a shareholders, a of the shares of each without shareholder shareholders' meeting shareholders' meeting Fund entitled to vote, approval. for the election must for the election of voting separately by be called for the Trustees would be Fund, or by the election of Trustees. called to the extent Trustees by written it is required by the notice to the 1940 Act. shareholders.
DECLARATION OF TRUST AMENDMENTS QUORUM ---------------------------------------------- ---------------------------------------------- COMPANY EXISTING PROVISION PROPOSED AMENDMENT EXISTING PROVISION PROPOSED AMENDMENT - ------- ---------------------- ---------------------- ---------------------- ---------------------- Tax-Managed A vote of shareholders The Trustees would The quorum requirement The quorum requirement is required for have authority to is 40% of the shares would be one-third of amendments that approve all amendments entitled to vote at a the shares entitled to (i) affect the voting for routine and non- meeting, except when a vote at a meeting, rights of routine matters other larger quorum is except when a larger shareholders, than those matters required by applicable quorum is required by (ii) amend the that are required to law, the Declaration the 1940 Act, the amendment provision of be approved by or the By- Laws. Declaration or the the Declaration, shareholders under the By-Laws. (iii) are required to 1940 Act. be approved by shareholders under applicable law, and (iv) are submitted to the shareholders by the Trustees.
REDEMPTION NUMBER OF TRUSTEES ---------------------------------------------- ---------------------------------------------- COMPANY EXISTING PROVISION PROPOSED AMENDMENT EXISTING PROVISION PROPOSED AMENDMENT - ------- ---------------------- ---------------------- ---------------------- ---------------------- Tax-Managed None. The number of Trustees The number of Trustees shall at all times be would be such number at least one and no as is determined by more than 15, as the Trustees from time determined by the to time but at least Trustees from time to one. time.
24
ADJOURNMENTS DERIVATIVE ACTIONS ---------------------------------------------- ---------------------------------------------- COMPANY EXISTING PROVISION PROPOSED AMENDMENT EXISTING PROVISION PROPOSED AMENDMENT - ------- ---------------------- ---------------------- ---------------------- ---------------------- Tax-Managed The existing By-Laws Shareholders holding a None. do not contain an majority of the express provision outstanding shares regarding the present and entitled requirements for to vote on adjournment adjournment of a of a meeting would shareholders' meeting. have authority to adjourn a shareholders meeting whether or not a quorum is present at the meeting.
MASTER/FEEDER TRANSACTIONS SHAREHOLDER VOTING ---------------------------------------------- ---------------------------------------------- COMPANY EXISTING PROVISION PROPOSED AMENDMENT EXISTING PROVISION PROPOSED AMENDMENT - ------- ---------------------- ---------------------- ---------------------- ---------------------- Tax-Managed None. Shareholders have the Shareholders would power to vote for the have the power to vote election and removal for the election and of Trustees and such removal of Trustees additional Company and such additional matters as may be Company matters as may required by applicable be required by the law. 1940 Act.
TERMINATION OF COMPANY, FUND OR CLASS ELECTION OF TRUSTEES ---------------------------------------------- ---------------------------------------------- COMPANY EXISTING PROVISION PROPOSED AMENDMENT EXISTING PROVISION PROPOSED AMENDMENT - ------- ---------------------- ---------------------- ---------------------- ---------------------- Tax-Managed The Company and any The Company and any If less than the If less than the Fund or Class of Fund or Class of majority of Trustees majority of Trustees shares may be shares may be holding office have holding office have dissolved at any time dissolved at any time been elected by been elected by by vote of a majority by the Trustees shareholders, a shareholders, a of the shares of each without shareholder shareholders' meeting shareholders' meeting Fund entitled to vote, approval. for the election must for the election of voting separately by be called for the Trustees would be Fund, or by the election of Trustees. called to the extent Trustees by written it is required by the notice to the 1940 Act. shareholders.
DECLARATION OF TRUST AMENDMENTS QUORUM ---------------------------------------------- ---------------------------------------------- COMPANY EXISTING PROVISION PROPOSED AMENDMENT EXISTING PROVISION PROPOSED AMENDMENT - ------- ---------------------- ---------------------- ---------------------- ---------------------- Real Estate A vote of shareholders The Trustees would The quorum requirement The quorum requirement is required for have authority to is 40% of the shares would be one-third of amendments that approve all amendments entitled to vote at a the shares entitled to (i) affect the voting for routine and non- meeting, except when a vote at a meeting, rights of routine matters other larger quorum is except when a larger shareholders, than those matters required by applicable quorum is required by (ii) amend the that are required to law, the Declaration the 1940 Act, the amendment provision of be approved by or the By- Laws. Declaration or the the Declaration, shareholders under the By-Laws. (iii) are required to 1940 Act. be approved by shareholders under applicable law, and (iv) are submitted to the shareholders by the Trustees.
25
REDEMPTION NUMBER OF TRUSTEES ---------------------------------------------- ---------------------------------------------- COMPANY EXISTING PROVISION PROPOSED AMENDMENT EXISTING PROVISION PROPOSED AMENDMENT - ------- ---------------------- ---------------------- ---------------------- ---------------------- Real Estate None. The number of Trustees The number of Trustees shall at all times be would be such number at least one and no as is determined by more than 15, as the Trustees from time determined by the to time but at least Trustees from time to one. time.
ADJOURNMENTS DERIVATIVE ACTIONS ---------------------------------------------- ---------------------------------------------- COMPANY EXISTING PROVISION PROPOSED AMENDMENT EXISTING PROVISION PROPOSED AMENDMENT - ------- ---------------------- ---------------------- ---------------------- ---------------------- Real Estate The existing By-Laws Shareholders holding a None. do not contain an majority of the express provision outstanding shares regarding the present and entitled requirements for to vote on adjournment adjournment of a of a meeting would shareholders' meeting. have authority to adjourn a shareholders meeting whether or not a quorum is present at the meeting.
MASTER/FEEDER TRANSACTIONS SHAREHOLDER VOTING ---------------------------------------------- ---------------------------------------------- COMPANY EXISTING PROVISION PROPOSED AMENDMENT EXISTING PROVISION PROPOSED AMENDMENT - ------- ---------------------- ---------------------- ---------------------- ---------------------- Real Estate None. Shareholders have the Shareholders would power to vote for the have the power to vote election and removal for the election and of Trustees and such removal of Trustees additional Company and such additional matters as may be Company matters as may required by applicable be required by the law. 1940 Act.
TERMINATION OF COMPANY, FUND OR CLASS ELECTION OF TRUSTEES ---------------------------------------------- ---------------------------------------------- COMPANY EXISTING PROVISION PROPOSED AMENDMENT EXISTING PROVISION PROPOSED AMENDMENT - ------- ---------------------- ---------------------- ---------------------- ---------------------- Real Estate The Company and any The Company and any If less than the If less than the Fund or Class of Fund or Class of majority of Trustees majority of Trustees shares may be shares may be holding office have holding office have dissolved at any time dissolved at any time been elected by been elected by by vote of a majority by the Trustees shareholders, a shareholders, a of the shares of each without shareholder shareholders' meeting shareholders' meeting Fund entitled to vote, approval. for the election must for the election of voting separately by be called for the Trustees would be Fund, or by the election of Trustees. called to the extent Trustees by written it is required by the notice to the 1940 Act. shareholders.
Set out below is the text of the proposed Charter Amendments to all Delaware Companies summarized in the preceding table: - Amend Section 2 of Article I of the Declaration to add the following definition: "Prior Declaration of Trust" means the original declaration of trust of the Trust as in effect from time to time up to the effectiveness of this Declaration of Trust; 26 - Amend Section 1 of Article IV of the Declaration to delete the first two sentences thereof in their entirety and replace them with one sentence to read as follows: The number of Trustees shall be the number established under or pursuant to the Prior Declaration of Trust or such number as is determined, from time to time, by the Trustees pursuant to Section 3 of this Article IV but shall at all times be at least one. - Amend the fourth sentence of Section 1 of Article IV of the Declaration in its entirety to read as follows: In the event that less than the majority of Trustees holding office have been elected by the Shareholders, to the extent required by the 1940 Act, but only to such extent, the Trustees then in office shall call a Shareholders' meeting for the election of Trustees. - Amend the first sentence of Section 1 of Article V of the Declaration in its entirety to read as follows: The Shareholders shall have power to vote only (i) for the election or removal of Trustees as and to the extent provided in Article IV, Section 1, and (ii) with respect to such additional matters relating to the Trust as may be required by the 1940 Act, this Declaration of Trust, the By-Laws or any registration of the Trust with the Commission (or any successor agency) or any state, or as the Trustees may consider necessary or desirable. - Amend the first and second sentences of Section 2 of Article V of the Declaration in their entirety to read as follows: Except when a larger quorum is required by federal law, including the 1940 Act, by the By-Laws or by this Declaration of Trust, one-third of the Shares entitled to vote shall constitute a quorum at a Shareholders' meeting. When any one or more Series (or Classes) is to vote as a single class separate from any other Shares, one-third of the Shares of all such Series (or Classes) entitled to vote shall constitute a quorum at a Shareholders' meeting of such Series (or Classes). - Amend Section 2 of Article VIII of the Declaration in its entirety to read as follows: Section 2. TERMINATION OF THE TRUST OR ANY SERIES OR CLASS. (a) Unless terminated as provided herein, the Trust shall continue without limitation of time. The Trust may be dissolved at any time by the Trustees by written notice to the Shareholders. Any Series of Shares may be dissolved at any time by the Trustees by written notice to the Shareholders of such Series. Any Class of any Series of Shares may be terminated at any time by the Trustees by written notice to the Shareholders of such Class. Any action to dissolve the Trust shall be deemed to also be an action to dissolve each Series and each Class thereof. (b) Upon the requisite action by the Trustees to dissolve the Trust or any one or more Series of Shares, after paying or otherwise providing for all charges, taxes, expenses and liabilities, whether due or accrued or anticipated, of the Trust or of the particular Series as may be determined by the Trustees, the Trust shall in accordance with such procedures as the Trustees consider appropriate reduce the remaining assets of the Trust or of the affected Series to distributable form in cash or Shares (if any Series remain) or other securities, or any combination thereof, and distribute the proceeds to the Shareholders of the Trust or Series involved, ratably according to the number of Shares of the Trust or such Series held by the several Shareholders of such Series on the date of distribution. Thereupon, any affected Series or Class shall terminate and the Trustees and the Trust shall be discharged of any and all further liabilities and duties relating thereto or arising therefrom, and the right, title and interest of all parties with respect to such Series shall be canceled and discharged. Upon the requisite action by the Trustees to terminate any Class of any Series of Shares, the Trustees may, to the extent they deem it appropriate, follow the procedures set forth in this Section 2(b) with respect to such Class that are specified in connection with the dissolution and 27 winding up of the Trust or any Series of Shares. Alternatively, in connection with the termination of any Class of any Series of Shares, the Trustees may treat such termination as a redemption of the Shareholders of such Class effected pursuant to Section 2(c) of Article VI of this Declaration of Trust provided that the costs relating to the termination of such Class shall be included in the determination of the net asset value of the Shares of such Class for purposes of determining the redemption price to be paid to the Shareholders of such Class (to the extent not otherwise included in such determination). (c) Following completion of winding up of the Trust's business, the Trustees shall cause a certificate of cancellation of the Trust's Certificate of Trust to be filed in accordance with the Delaware Act, which certificate of cancellation may be signed by any one Trustee. Upon termination of the Trust, the Trustees shall be discharged of any and all further liabilities and duties relating thereto or arising therefrom, and the right, title and interest of all parties with respect to the Trust shall be canceled and discharged. - Amend Section 4 of Article VIII of the Declaration in its entirety to read as follows: Section 4. AMENDMENTS. Except as specifically provided in this Section 4, the Trustees may, without Shareholder vote, restate, amend or otherwise supplement this Declaration of Trust. Shareholders shall have the right to vote (i) on any amendment that is required to be approved by Shareholders pursuant to the 1940 Act and (ii) on any amendment submitted to the Shareholders by the Trustees at their discretion. Any amendment required or permitted to be submitted to the Shareholders that, as the Trustees determine, shall only affect the Shareholders of one or more Series or one or more Classes shall be authorized by a vote of only the Shareholders of each Series or Class affected and no vote of Shareholders of a Series or Class not affected shall be required. Notwithstanding anything else herein, no amendment hereof shall limit the rights to insurance provided by Article VII, Section 4 of this Declaration of Trust with respect to any acts or omissions of Persons covered thereby prior to such amendment nor shall any such amendment limit the rights to indemnification referenced in Article VII, Section 2 of this Declaration of Trust or as provided in the By-Laws with respect to any actions or omissions of Persons covered thereby prior to such amendment. The Trustees may, without Shareholder vote, restate, amend, or otherwise supplement the Certificate of Trust as the Trustees deem necessary or desirable. - Amend Section 1 of Article III of the By-Laws to add a sentence at the end thereof to read as follows: Any meeting of Shareholders may be adjourned one or more times from time to time to another time or place by Shareholders holding a majority of the outstanding Shares present and entitled to vote on a proposal to adjourn at such meeting, whether or not a quorum is present. Set out below is the text of the additional proposed Charter Amendments with respect to Index Series: - Amend Section 1 of Article V of the Declaration to delete the second sentence thereof in its entirety and replace it with two sentences to read as follows: As determined by the Trustees without the vote or consent of Shareholders (except as required by the 1940 Act), on any matter submitted to a vote of Shareholders, either (i) 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 or (ii) each dollar of Net Asset Value (number of Shares owned times Net Asset Value per share of such Series or Class, as applicable) shall be entitled to one vote on any matter on which such Shares are entitled to vote and each fractional dollar amount shall be entitled to a proportionate fractional vote. Without limiting the power of the Trustees in any way to designate otherwise in accordance with the preceding sentence, the Trustees hereby establish that 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. 28 - Amend Section 2(c) of Article VI of the Declaration in its entirety to read as follows: (c) The Trustees may require any Shareholder or group of Shareholders (including some or all of the Shareholders of any Series or Class) to redeem Shares for any reason under terms set by the Trustees, including (i) the determination of the Trustees that direct or indirect ownership of Shares of any Series has or may become concentrated in such Shareholder to an extent that would disqualify any Series as a regulated investment company under the Internal Revenue Code of 1986, as amended (or any successor statute thereto), (ii) the failure of a Shareholder to supply a tax identification number if required to do so, or to have the minimum investment required (which may vary by Series), or (iii) the failure of a Shareholder to pay when due for the purchase of Shares issued to him. Any such redemption shall be effected at the redemption price and in the manner provided in this Article VI. - Amend Section 3(c) of Article VIII of the Declaration in its entirety to read as follows: (c) Notwithstanding anything else herein, the Trustees may, without Shareholder approval unless such approval is required by the 1940 Act, invest all or a portion of the Trust Property of any Series, or dispose of all or a portion of the Trust Property of any Series, and invest the proceeds of such disposition in interests issued by one or more other investment companies registered under the 1940 Act. Any such other investment company may (but need not) be a trust (formed under the laws of the State of Delaware or any other state or jurisdiction) (or subtrust thereof) which is classified as a partnership for federal income tax purposes. Notwithstanding anything else herein, the Trustees may, without Shareholder approval unless such approval is required by the 1940 Act, cause a Series that is organized in the master/feeder fund structure to withdraw or redeem its Trust Property from the master fund and cause such Series to invest its Trust Property directly in securities and other financial instruments or in another master fund. - Amend Article VIII of the Declaration to add a new Section 9 to read as follows: Section 9. DERIVATIVE ACTIONS. IN ADDITION TO THE REQUIREMENTS SET FORTH IN SECTION 3816 OF THE DELAWARE ACT, A SHAREHOLDER MAY BRING A DERIVATIVE ACTION ON BEHALF OF THE TRUST ONLY IF THE FOLLOWING CONDITIONS ARE MET: (a) The Shareholder or Shareholders must make a pre-suit demand upon the Trustees to bring the subject action unless an effort to cause the Trustees to bring such an action is not likely to succeed. For purposes of this Section 9(a), a demand on the Trustees shall only be deemed not likely to succeed and therefore excused if a majority of the Board of Trustees, or a majority of any committee established to consider the merits of such action, is composed of Trustees who are not "independent trustees" (as that term is defined in the Delaware Act). (b) Unless a demand is not required under paragraph (a) of this Section 9, Shareholders eligible to bring such derivative action under the Delaware Act who collectively hold at least 10% of the outstanding Shares of the Trust, or who collectively hold at least 10% of the outstanding Shares of the Series or Class to which such action relates, shall join in the request for the Trustees to commence such action; and (c) Unless a demand is not required under paragraph (a) of this Section 9, the Trustees must be afforded a reasonable amount of time to consider such Shareholder request and to investigate the basis of such claim. The Trustees shall be entitled to retain counsel or other advisors in considering the merits of the request and shall require an undertaking by the Shareholders making such request to reimburse the Trust for the expense of any such advisors in the event that the Trustees determine not to bring such action. (d) For purposes of this Section 9, the Board of Trustees may designate a committee of one Trustee to consider a Shareholder demand if necessary to create a committee with a majority of Trustees who do not have a personal financial interest in the transaction at issue. The Trustees shall be entitled to retain counsel or other advisors in considering the merits of the request and may require an 29 undertaking by the Shareholders making such request to reimburse the Trust for the expense of any such advisors in the event that the Trustees determine not to bring such action. MARYLAND SUMMARY AND TEXT OF CHARTER AMENDMENTS
COMPANY CHARTER QUORUM LIMITATION ON AMENDMENTS LIABILITY Equity EXISTING REQUIREMENT: EXISTING REQUIREMENT: EXISTING PROVISION: Most Charter amendments The presence, in person or The Charter provides that, require the approval of a by proxy, of a majority of to the extent permitted by majority of the shares of all votes entitled to be law, a director or officer common stock outstanding cast at the meeting. of the Company shall not and entitled to vote. It be liable to the Company appears that minor PROPOSED AMENDMENT: or its shareholders for amendments may be approved THE PRESENCE, IN PERSON OR monetary damages for without shareholder BY PROXY, OF ONE-THIRD OF breach of fiduciary duty. action. ALL VOTES ENTITLED TO BE CAST AT THE MEETING OR ON PROPOSED AMENDMENT: PROPOSED AMENDMENT: A MATTER WOULD CONSTITUTE NO CHANGE PROPOSED. THE CHARTER WOULD CLARIFY A QUORUM FOR SUCH MEETING THAT THE COMPANY CAN OR MATTER. (SEE EFFECT CERTAIN CHARTER (2) BELOW). AMENDMENTS WITHOUT SHAREHOLDER APPROVAL. THE CHARTER WOULD ALSO INCLUDE SPECIFIC LANGUAGE RESERVING THE RIGHT OF THE COMPANY TO CHANGE THE "CONTRACT RIGHTS" OF OUTSTANDING SHARES. IN ADDITION, THE CHARTER WOULD CLARIFY THAT THE BOARD OF DIRECTORS, WITHOUT SHAREHOLDER ACTION, CAN INCREASE OR DECREASE THE AGGREGATE NUMBER OF SHARES THAT THE COMPANY HAS AUTHORITY TO ISSUE. (SEE (1) BELOW). COMPANY INDEMNIFICATION MASTER/FEEDER SHAREHOLDER VOTING REDEMPTION TRANSACTIONS FEES AND VOTE Equity EXISTING PROVISION: EXISTING PROVISION: EXISTING REQUIREMENT: EXISTING PROVISION: The Company's By-Laws None. One vote for each share None. provide that the Company held. shall indemnify present PROPOSED AMENDMENT: PROPOSED AMENDMENT: and former directors, THE COMPANY WOULD HAVE PROPOSED AMENDMENT: THE COMPANY WOULD HAVE officers, employees and EXPLICIT AUTHORITY TO NO CHANGE PROPOSED. EXPLICIT AUTHORITY TO agents against judgments, INVEST ASSETS IN CASH OR SUBTRACT REDEMPTION FEES fines, settlements and IN INTERESTS ISSUED BY AND OTHER CHARGES, AS expenses to the extent OTHER INVESTMENT DETERMINED BY THE BOARD OF permitted by law, COMPANIES. (SEE DIRECTORS, FROM THE AMOUNT including by advance of (6) BELOW). PAYABLE TO SHAREHOLDERS IN expenses. The Charter does CONNECTION WITH A not include any REDEMPTION BY SHAREHOLDERS corresponding provisions. OR BY THE COMPANY. THE CHARTER WOULD ALSO CLARIFY PROPOSED AMENDMENT: THAT THE COMPANY CAN THE CHARTER WOULD INCLUDE REDEEM ALL OUTSTANDING A PROVISION (SEE SHARES IN A FUND OR CLASS (5) BELOW) PROVIDING THAT WITHOUT A SHAREHOLDER THE COMPANY SHALL VOTE. (SEE (7) BELOW). INDEMNIFY (a) CURRENT AND FORMER DIRECTORS AND OFFICERS, TO THE EXTENT PERMITTED BY LAW, INCLUDING BY ADVANCE OF EXPENSES AND (b) OTHER EMPLOYEES AND AGENTS TO THE EXTENT APPROVED BY THE BOARD OF DIRECTORS AND PERMITTED BY LAW. AFTER ADOPTION OF THIS PROVISION, NO SUBSEQUENT AMENDMENT OR REPEAL COULD LIMIT THE INDEMNIFICATION PROTECTION WITH RESPECT TO ACTS OR OMISSIONS OCCURRING PRIOR TO SUCH AMENDMENT OR REPEAL.
30
COMPANY CHARTER QUORUM LIMITATION ON AMENDMENTS LIABILITY Natural EXISTING REQUIREMENT: EXISTING REQUIREMENT: EXISTING PROVISION: Resources The Charter reserves the The presence, in person or None. Company's right to adopt by proxy, of a majority of Charter amendments to the all votes entitled to be PROPOSED AMENDMENT: extent permitted by law. cast at the meeting. THE CHARTER WOULD PROVIDE For minor matters such as THAT, TO THE EXTENT name changes, and changes PROPOSED AMENDMENT: PERMITTED BY LAW, A in the par value of THE PRESENCE, IN PERSON OR DIRECTOR OR OFFICER OF THE shares, the Company can BY PROXY, OF ONE-THIRD OF COMPANY WOULD NOT BE amend the Charter without ALL VOTES ENTITLED TO BE LIABLE TO THE COMPANY OR shareholder approval. CAST AT THE MEETING OR ON ITS SHAREHOLDERS FOR A MATTER WOULD CONSTITUTE MONETARY DAMAGES FOR PROPOSED AMENDMENT: A QUORUM FOR SUCH MEETING BREACH OF FIDUCIARY DUTY. THE EXISTING CHARTER OR MATTER. (SEE NO SUBSEQUENT MODIFICATION PROVISION WOULD BE REVISED (2) BELOW). OR REPEAL OF THIS TO MATCH THE LANGUAGE IN PROVISION COULD REVOKE THE OTHER MARYLAND COMPANY THIS PROTECTION FOR EVENTS CHARTERS (SEE (1) BELOW) BETWEEN ADOPTION OF THE AND TO SPECIFICALLY PROVISION AND SUCH INDICATE THAT THE COMPANY MODIFICATION OR REPEAL. RESERVES THE RIGHT TO (SEE (4) BELOW). CHANGE THE "CONTRACT RIGHTS" OF OUTSTANDING SHARES. IN ADDITION, THE CHARTER WOULD CLARIFY THAT THE BOARD OF DIRECTORS, WITHOUT SHAREHOLDER ACTION, CAN INCREASE OR DECREASE THE AGGREGATE NUMBER OF SHARES THAT THE COMPANY HAS AUTHORITY TO ISSUE. COMPANY INDEMNIFICATION MASTER/FEEDER SHAREHOLDER VOTING REDEMPTION TRANSACTIONS FEES AND VOTE Natural EXISTING PROVISION: EXISTING PROVISION: EXISTING REQUIREMENT: EXISTING PROVISION: Resources The Company's By-Laws None. One vote for each share None. provide that the Company held. shall indemnify present PROPOSED AMENDMENT: PROPOSED AMENDMENT: and former directors, THE COMPANY WOULD HAVE PROPOSED AMENDMENT: THE COMPANY WOULD HAVE officers, employees and EXPLICIT AUTHORITY TO NO CHANGE PROPOSED. EXPLICIT AUTHORITY TO agents against judgments, INVEST ASSETS IN CASH OR SUBTRACT REDEMPTION FEES fines, settlements and IN INTERESTS ISSUED BY AND OTHER CHARGES, AS expenses to the extent OTHER INVESTMENT DETERMINED BY THE BOARD OF permitted by law, COMPANIES. (SEE DIRECTORS, FROM THE AMOUNT including by advance of (6) BELOW). PAYABLE TO SHAREHOLDERS IN expenses. The Charter does CONNECTION WITH A not include any REDEMPTION BY SHAREHOLDERS corresponding provisions. OR BY THE COMPANY. THE CHARTER WOULD ALSO CLARIFY PROPOSED AMENDMENT: THAT THE COMPANY CAN THE CHARTER WOULD INCLUDE REDEEM ALL OUTSTANDING A PROVISION (SEE SHARES IN A FUND OR CLASS (5) BELOW) PROVIDING THAT WITHOUT A SHAREHOLDER THE COMPANY SHALL VOTE. (SEE (7) BELOW). INDEMNIFY (a) CURRENT AND FORMER DIRECTORS AND OFFICERS, TO THE EXTENT PERMITTED BY LAW, INCLUDING BY ADVANCE OF EXPENSES; AND (b) OTHER EMPLOYEES AND AGENTS TO THE EXTENT APPROVED BY THE BOARD OF DIRECTORS AND PERMITTED BY LAW. AFTER ADOPTION OF THIS PROVISION, NO SUBSEQUENT AMENDMENT OR REPEAL COULD LIMIT THE INDEMNIFICATION PROTECTION WITH RESPECT TO ACTS OR OMISSIONS OCCURRING PRIOR TO SUCH AMENDMENT OR REPEAL.
31
COMPANY CHARTER QUORUM LIMITATION ON AMENDMENTS LIABILITY Sector Funds EXISTING REQUIREMENT: EXISTING REQUIREMENT: EXISTING PROVISION: Most Charter amendments The presence, in person or The Charter provides that, require the approval of a by proxy, of a majority of to the extent permitted by majority of the shares of all votes entitled to be law, a director or officer common stock outstanding cast at the meeting. of the Company shall not and entitled to vote. It be liable to the Company appears that minor PROPOSED AMENDMENT: or its shareholders for amendments may be approved THE PRESENCE, IN PERSON OR monetary damages for without shareholder BY PROXY, OF ONE-THIRD OF breach of fiduciary duty. action. ALL VOTES ENTITLED TO BE CAST AT THE MEETING OR ON PROPOSED AMENDMENT: PROPOSED AMENDMENT: A MATTER WOULD CONSTITUTE NO CHANGE PROPOSED. THE CHARTER WOULD CLARIFY A QUORUM FOR SUCH MEETING THAT THE COMPANY CAN OR MATTER. (SEE EFFECT CERTAIN CHARTER (2) BELOW). AMENDMENTS WITHOUT SHAREHOLDER APPROVAL. THE CHARTER WOULD ALSO INCLUDE SPECIFIC LANGUAGE RESERVING THE RIGHT OF THE COMPANY TO CHANGE THE "CONTRACT RIGHTS" OF OUTSTANDING SHARES. IN ADDITION, THE CHARTER WOULD CLARIFY THAT THE BOARD OF DIRECTORS, WITHOUT SHAREHOLDER ACTION, CAN INCREASE OR DECREASE THE AGGREGATE NUMBER OF SHARES THAT THE COMPANY HAS AUTHORITY TO ISSUE. (SEE (1) BELOW). COMPANY INDEMNIFICATION MASTER/FEEDER SHAREHOLDER VOTING REDEMPTION TRANSACTIONS FEES AND VOTE Sector Funds EXISTING PROVISION: EXISTING PROVISION: EXISTING REQUIREMENT: EXISTING PROVISION: The Company's By-Laws None. One vote for each share None. provide that the Company held. shall indemnify present PROPOSED AMENDMENT: PROPOSED AMENDMENT: and former directors, THE COMPANY WOULD HAVE PROPOSED AMENDMENT: THE COMPANY WOULD HAVE officers, employees and EXPLICIT AUTHORITY TO ONE VOTE FOR EACH DOLLAR EXPLICIT AUTHORITY TO agents against judgments, INVEST ASSETS IN CASH OR OF NET ASSET VALUE SUBTRACT REDEMPTION FEES fines, settlements and IN INTERESTS ISSUED BY REPRESENTED BY SHARES AND OTHER CHARGES, AS expenses to the extent OTHER INVESTMENT HELD. (SEE (3) BELOW). DETERMINED BY THE BOARD OF permitted by law, COMPANIES. (SEE DIRECTORS, FROM THE AMOUNT including by advance of (6) BELOW). PAYABLE TO SHAREHOLDERS IN expenses. The Charter does CONNECTION WITH A not include any REDEMPTION BY SHAREHOLDERS corresponding provisions. OR BY THE COMPANY. THE CHARTER WOULD ALSO CLARIFY PROPOSED AMENDMENT: THAT THE COMPANY CAN THE CHARTER WOULD INCLUDE REDEEM ALL OUTSTANDING A PROVISION (SEE SHARES IN A FUND OR CLASS (5) BELOW) PROVIDING THAT WITHOUT A SHAREHOLDER THE COMPANY SHALL VOTE. (SEE (7) BELOW). INDEMNIFY (a) CURRENT AND FORMER DIRECTORS AND OFFICERS, TO THE EXTENT PERMITTED BY LAW, INCLUDING BY ADVANCE OF EXPENSES; AND (b) OTHER EMPLOYEES AND AGENTS TO THE EXTENT APPROVED BY THE BOARD OF DIRECTORS AND PERMITTED BY LAW. AFTER ADOPTION OF THIS PROVISION, NO SUBSEQUENT AMENDMENT OR REPEAL COULD LIMIT THE INDEMNIFICATION PROTECTION WITH RESPECT TO ACTS OR OMISSIONS OCCURRING PRIOR TO SUCH AMENDMENT OR REPEAL.
32
COMPANY CHARTER QUORUM LIMITATION ON AMENDMENTS LIABILITY Small Company EXISTING REQUIREMENT: EXISTING REQUIREMENT: EXISTING PROVISION: Most Charter amendments The presence, in person or The Charter provides that, require the approval of a by proxy, of a majority of to the extent permitted by majority of the shares of all votes entitled to be law, a director or officer common stock outstanding cast at the meeting. of the Company shall not and entitled to vote. It be liable to the Company appears that minor PROPOSED AMENDMENT: or its shareholders for amendments may be approved THE PRESENCE, IN PERSON OR monetary damages for without shareholder BY PROXY, OF ONE-THIRD OF breach of fiduciary duty. action. ALL VOTES ENTITLED TO BE CAST AT THE MEETING OR ON PROPOSED AMENDMENT: PROPOSED AMENDMENT: A MATTER WOULD CONSTITUTE NO CHANGE PROPOSED. THE CHARTER WOULD CLARIFY A QUORUM FOR SUCH MEETING THAT THE COMPANY CAN OR MATTER. (SEE EFFECT CERTAIN CHARTER (2) BELOW). AMENDMENTS WITHOUT SHAREHOLDER APPROVAL. THE CHARTER WOULD ALSO INCLUDE SPECIFIC LANGUAGE RESERVING THE RIGHT OF THE COMPANY TO CHANGE THE "CONTRACT RIGHTS" OF OUTSTANDING SHARES. IN ADDITION, THE CHARTER WOULD CLARIFY THAT THE BOARD OF DIRECTORS, WITHOUT SHAREHOLDER ACTION, CAN INCREASE OR DECREASE THE AGGREGATE NUMBER OF SHARES THAT THE COMPANY HAS AUTHORITY TO ISSUE. (SEE (1) BELOW). COMPANY INDEMNIFICATION MASTER/FEEDER SHAREHOLDER VOTING REDEMPTION TRANSACTIONS FEES AND VOTE Small Company EXISTING PROVISION: EXISTING PROVISION: EXISTING REQUIREMENT: EXISTING PROVISION: The Company's By-Laws None. One vote for each share None. provide that the Company held. shall indemnify present PROPOSED AMENDMENT: PROPOSED AMENDMENT: and former directors, THE COMPANY WOULD HAVE PROPOSED AMENDMENT: THE COMPANY WOULD HAVE officers, employees and EXPLICIT AUTHORITY TO NO CHANGE PROPOSED. EXPLICIT AUTHORITY TO agents against judgments, INVEST ASSETS IN CASH OR SUBTRACT REDEMPTION FEES fines, settlements and IN INTERESTS ISSUED BY AND OTHER CHARGES, AS expenses to the extent OTHER INVESTMENT DETERMINED BY THE BOARD OF permitted by law, COMPANIES. (SEE DIRECTORS, FROM THE AMOUNT including by advance of (6) BELOW). PAYABLE TO SHAREHOLDERS IN expenses. The Charter does CONNECTION WITH A not include any REDEMPTION BY SHAREHOLDERS corresponding provisions. OR BY THE COMPANY. THE CHARTER WOULD ALSO CLARIFY PROPOSED AMENDMENT: THAT THE COMPANY CAN THE CHARTER WOULD INCLUDE REDEEM ALL OUTSTANDING A PROVISION (SEE SHARES IN A FUND OR CLASS (5) BELOW) PROVIDING THAT WITHOUT A SHAREHOLDER THE COMPANY SHALL VOTE. (SEE (7) BELOW). INDEMNIFY (a) CURRENT AND FORMER DIRECTORS AND OFFICERS, TO THE EXTENT PERMITTED BY LAW, INCLUDING BY ADVANCE OF EXPENSES; AND (b) OTHER EMPLOYEES AND AGENTS TO THE EXTENT APPROVED BY THE BOARD OF DIRECTORS AND PERMITTED BY LAW. AFTER ADOPTION OF THIS PROVISION, NO SUBSEQUENT AMENDMENT OR REPEAL COULD LIMIT THE INDEMNIFICATION PROTECTION WITH RESPECT TO ACTS OR OMISSIONS OCCURRING PRIOR TO SUCH AMENDMENT OR REPEAL.
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COMPANY CHARTER QUORUM LIMITATION ON AMENDMENTS LIABILITY Small Cap EXISTING REQUIREMENT: EXISTING REQUIREMENT: EXISTING PROVISION: The Charter reserves the The presence, in person or The Charter provides that, Company's right to adopt by proxy, of one- third of to the extent permitted by Charter amendments to the all votes entitled to be law, no director or extent permitted by law. cast at the meeting. officer of the Company For minor matters such as shall be personally liable name changes and changes PROPOSED AMENDMENT: to the Company or its in the par value of THE EXISTING CHARTER shareholders for monetary shares, the Company can PROVISION WOULD BE REVISED damages. amend the Charter without TO MATCH THE LANGUAGE IN shareholder approval. THE OTHER MARYLAND COMPANY PROPOSED AMENDMENT: CHARTERS (SEE (2) BELOW) THE EXISTING CHARTER PROPOSED AMENDMENT: AND TO CLARIFY THAT THE PROVISION WOULD BE REVISED THE EXISTING CHARTER PRESENCE, IN PERSON OR BY TO MATCH THE LANGUAGE IN PROVISION WOULD BE REVISED PROXY, OF ONE- THIRD OF THE OTHER MARYLAND COMPANY TO MATCH THE LANGUAGE IN THE VOTES ENTITLED TO BE CHARTERS (SEE (4) BELOW). THE OTHER MARYLAND COMPANY CAST ON A MATTER WOULD CHARTERS (SEE (1) BELOW) CONSTITUTE A QUORUM FOR AND TO SPECIFICALLY THAT MATTER, EVEN IF FEWER INDICATE THAT THE COMPANY THAN ALL CLASSES OR FUNDS RESERVES THE RIGHT TO ARE ENTITLED TO VOTE. CHANGE THE "CONTRACT RIGHTS" OF OUTSTANDING SHARES. IN ADDITION, THE CHARTER WOULD CLARIFY THAT THE BOARD OF DIRECTORS, WITHOUT SHAREHOLDER ACTION, CAN INCREASE OR DECREASE THE AGGREGATE NUMBER OF SHARES THAT THE COMPANY HAS AUTHORITY TO ISSUE. COMPANY INDEMNIFICATION MASTER/FEEDER SHAREHOLDER VOTING REDEMPTION TRANSACTIONS FEES AND VOTE Small Cap EXISTING PROVISION: EXISTING PROVISION: EXISTING REQUIREMENT: EXISTING PROVISION: The Charter provides that None. One vote for each share None. the Company shall held. indemnify present and PROPOSED AMENDMENT: PROPOSED AMENDMENT: former directors and THE COMPANY WOULD HAVE PROPOSED AMENDMENT: THE COMPANY WOULD HAVE officers to the extent EXPLICIT AUTHORITY TO NO CHANGE PROPOSED. EXPLICIT AUTHORITY TO permitted by law, INVEST ASSETS IN CASH OR SUBTRACT REDEMPTION FEES including by advance of IN INTERESTS ISSUED BY AND OTHER CHARGES, AS expenses, and the OTHER INVESTMENT DETERMINED BY THE BOARD OF Company's By-Laws provide COMPANIES. (SEE DIRECTORS, FROM THE AMOUNT that the Company shall (6) BELOW). PAYABLE TO SHAREHOLDERS IN indemnify present and CONNECTION WITH A former directors, REDEMPTION BY SHAREHOLDERS officers, employees and OR BY THE COMPANY. THE agents against judgments, CHARTER WOULD ALSO CLARIFY fines, settlements and THAT THE COMPANY CAN expenses to the extent REDEEM ALL OUTSTANDING permitted by law, SHARES IN A FUND OR CLASS including by advance of WITHOUT A SHAREHOLDER expenses. VOTE. (SEE (7) BELOW). PROPOSED AMENDMENT: THE EXISTING CHARTER PROVISION WOULD BE REVISED TO MATCH THE LANGUAGE IN THE OTHER MARYLAND COMPANY CHARTERS (SEE (5) BELOW) AND TO INCLUDE AUTHORITY FOR THE COMPANY TO INDEMNIFY EMPLOYEES AND AGENTS OTHER THAN DIRECTORS AND OFFICERS TO THE EXTENT APPROVED BY THE BOARD OF DIRECTORS AND PERMITTED BY LAW. INDEMNIFICATION OF PERSONS OTHER THAN OFFICERS AND DIRECTORS CURRENTLY APPEARS ONLY IN THE COMPANY'S BY-LAWS.
34
COMPANY CHARTER QUORUM LIMITATION ON AMENDMENTS LIABILITY Emerging EXISTING REQUIREMENT: EXISTING REQUIREMENT: EXISTING PROVISION: Growth The Charter reserves the The presence, in person or The Charter provides that, Company's right to adopt by proxy, of one- third of to the extent permitted by Charter amendments to the all votes entitled to be law, no director or extent permitted by law. cast at the meeting. officer of the Company For minor matters such as shall be personally liable name changes and changes PROPOSED AMENDMENT: to the Company or its in the par value of THE EXISTING CHARTER shareholders for monetary shares, the Company can PROVISION WOULD BE REVISED damages. amend the Charter without TO MATCH THE LANGUAGE IN shareholder approval. THE OTHER MARYLAND COMPANY PROPOSED AMENDMENT: CHARTERS (SEE (2) BELOW) THE EXISTING CHARTER PROPOSED AMENDMENT: AND TO CLARIFY THAT THE PROVISION WOULD BE REVISED THE EXISTING CHARTER PRESENCE, IN PERSON OR BY TO MATCH THE LANGUAGE IN PROVISION WOULD BE REVISED PROXY, OF ONE- THIRD OF THE OTHER MARYLAND COMPANY TO MATCH THE LANGUAGE IN THE VOTES ENTITLED TO BE CHARTERS (SEE (4) BELOW). THE OTHER MARYLAND COMPANY CAST ON A MATTER WOULD CHARTERS (SEE (1) BELOW) CONSTITUTE A QUORUM FOR AND TO SPECIFICALLY THAT MATTER, EVEN IF FEWER INDICATE THAT THE COMPANY THAN ALL CLASSES OR FUNDS RESERVES THE RIGHT TO ARE ENTITLED TO VOTE. CHANGE THE "CONTRACT RIGHTS" OF OUTSTANDING SHARES. IN ADDITION, THE CHARTER WOULD CLARIFY THAT THE BOARD OF DIRECTORS, WITHOUT SHAREHOLDER ACTION, CAN INCREASE OR DECREASE THE AGGREGATE NUMBER OF SHARES THAT THE COMPANY HAS AUTHORITY TO ISSUE. COMPANY INDEMNIFICATION MASTER/FEEDER SHAREHOLDER VOTING REDEMPTION TRANSACTIONS FEES AND VOTE Emerging EXISTING PROVISION: EXISTING PROVISION: EXISTING REQUIREMENT: EXISTING PROVISION: Growth The Charter provides that None. One vote for each share None. the Company shall held. indemnify present and PROPOSED AMENDMENT: PROPOSED AMENDMENT: former directors and THE COMPANY WOULD HAVE PROPOSED AMENDMENT: THE COMPANY WOULD HAVE officers to the extent EXPLICIT AUTHORITY TO NO CHANGE PROPOSED. EXPLICIT AUTHORITY TO permitted by law, INVEST ASSETS IN CASH OR SUBTRACT REDEMPTION FEES including by advance of IN INTERESTS ISSUED BY AND OTHER CHARGES, AS expenses, and the OTHER INVESTMENT DETERMINED BY THE BOARD OF Company's By-Laws provide COMPANIES. (SEE DIRECTORS, FROM THE AMOUNT that the Company shall (6) BELOW). PAYABLE TO SHAREHOLDERS IN indemnify present and CONNECTION WITH A former directors, REDEMPTION BY SHAREHOLDERS officers, employees and OR BY THE COMPANY. THE agents against judgments, CHARTER WOULD ALSO CLARIFY fines, settlements and THAT THE COMPANY CAN expenses to the extent REDEEM ALL OUTSTANDING permitted by law, SHARES IN A FUND OR CLASS including by advance of WITHOUT A SHAREHOLDER expenses. VOTE. (SEE (7) BELOW). PROPOSED AMENDMENT: THE EXISTING CHARTER PROVISION WOULD BE REVISED TO MATCH THE LANGUAGE IN THE OTHER MARYLAND COMPANY CHARTERS (SEE (5) BELOW) AND TO INCLUDE AUTHORITY FOR THE COMPANY TO INDEMNIFY EMPLOYEES AND AGENTS OTHER THAN DIRECTORS AND OFFICERS TO THE EXTENT APPROVED BY THE BOARD OF DIRECTORS AND PERMITTED BY LAW. INDEMNIFICATION OF PERSONS OTHER THAN OFFICERS AND DIRECTORS CURRENTLY APPEARS ONLY IN THE COMPANY'S BY-LAWS.
35
COMPANY CHARTER QUORUM LIMITATION ON AMENDMENTS LIABILITY PIP EXISTING REQUIREMENT: EXISTING REQUIREMENT: EXISTING PROVISION: The Charter reserves the The presence, in person or The Charter provides that, Company's right to adopt by proxy, of a majority of to the extent permitted by Charter amendments to the all votes entitled to be law, no director or extent permitted by law. cast at the meeting. officer of the Company For minor matters such as shall be personally liable name changes and changes PROPOSED AMENDMENT: to the Company or its in the par value of THE PRESENCE, IN PERSON OR shareholders for monetary shares, the Company can BY PROXY, OF ONE-THIRD OF damages. amend the Charter without ALL VOTES ENTITLED TO BE shareholder approval. CAST AT THE MEETING OR ON PROPOSED AMENDMENT: A MATTER WOULD CONSTITUTE THE EXISTING CHARTER PROPOSED AMENDMENT: A QUORUM FOR SUCH MEETING PROVISION WOULD BE REVISED THE EXISTING CHARTER OR MATTER. (SEE TO MATCH THE LANGUAGE IN PROVISION WOULD BE REVISED (2) BELOW). THE OTHER MARYLAND COMPANY TO MATCH THE LANGUAGE IN CHARTERS (SEE (4) BELOW). THE OTHER MARYLAND COMPANY CHARTERS (SEE (1) BELOW) AND TO SPECIFICALLY INDICATE THAT THE COMPANY RESERVES THE RIGHT TO CHANGE THE "CONTRACT RIGHTS" OF OUTSTANDING SHARES. IN ADDITION, THE CHARTER WOULD CLARIFY THAT THE BOARD OF DIRECTORS, WITHOUT SHAREHOLDER ACTION, CAN INCREASE OR DECREASE THE AGGREGATE NUMBER OF SHARES THAT THE COMPANY HAS AUTHORITY TO ISSUE. COMPANY INDEMNIFICATION MASTER/FEEDER SHAREHOLDER VOTING REDEMPTION TRANSACTIONS FEES AND VOTE PIP EXISTING PROVISION: EXISTING PROVISION: EXISTING REQUIREMENT: EXISTING PROVISION: The Charter provides that None. One vote for each share None. the Company shall held. indemnify present and PROPOSED AMENDMENT: PROPOSED AMENDMENT: former directors and THE COMPANY WOULD HAVE PROPOSED AMENDMENT: THE COMPANY WOULD HAVE officers to the extent EXPLICIT AUTHORITY TO ONE VOTE FOR EACH DOLLAR EXPLICIT AUTHORITY TO permitted by law, INVEST ASSETS IN CASH OR OF NET ASSET VALUE SUBTRACT REDEMPTION FEES including by advance of IN INTERESTS ISSUED BY REPRESENTED BY SHARES AND OTHER CHARGES, AS expenses, and the OTHER INVESTMENT HELD. (SEE (3) BELOW). DETERMINED BY THE BOARD OF Company's By-Laws provide COMPANIES. (SEE DIRECTORS, FROM THE AMOUNT that the Company shall (6) BELOW). PAYABLE TO SHAREHOLDERS IN indemnify present and CONNECTION WITH A former directors, REDEMPTION BY SHAREHOLDERS officers, employees and OR BY THE COMPANY. THE agents against judgments, CHARTER WOULD ALSO CLARIFY fines, settlements and THAT THE COMPANY CAN expenses to the extent REDEEM ALL OUTSTANDING permitted by law, SHARES IN A FUND OR CLASS including by advance of WITHOUT A SHAREHOLDER expenses. VOTE. (SEE (7) BELOW). PROPOSED AMENDMENT: THE EXISTING CHARTER PROVISION WOULD BE REVISED TO MATCH THE LANGUAGE IN THE OTHER MARYLAND COMPANY CHARTERS (SEE (5) BELOW) AND TO INCLUDE AUTHORITY FOR THE COMPANY TO INDEMNIFY EMPLOYEES AND AGENTS OTHER THAN DIRECTORS AND OFFICERS TO THE EXTENT APPROVED BY THE BOARD OF DIRECTORS AND PERMITTED BY LAW. INDEMNIFICATION OF PERSONS OTHER THAN OFFICERS AND DIRECTORS CURRENTLY APPEARS ONLY IN THE COMPANY'S BY-LAWS.
36
COMPANY CHARTER QUORUM LIMITATION ON AMENDMENTS LIABILITY World EXISTING REQUIREMENT: EXISTING REQUIREMENT: EXISTING PROVISION: The Charter reserves the The presence, in person or None. Company's right to adopt by proxy, of a majority of Charter amendments to the all votes entitled to be PROPOSED AMENDMENT: extent permitted by law. cast at the meeting. THE CHARTER WOULD PROVIDE For minor matters such as THAT, TO THE EXTENT name changes and changes PROPOSED AMENDMENT: PERMITTED BY LAW, A in the par value of THE PRESENCE, IN PERSON OR DIRECTOR OR OFFICER OF THE shares, the Company can BY PROXY, OF ONE-THIRD OF COMPANY WOULD NOT BE amend the Charter without ALL VOTES ENTITLED TO BE LIABLE TO THE COMPANY OR shareholder approval. CAST AT THE MEETING OR ON ITS SHAREHOLDERS FOR A MATTER WOULD CONSTITUTE MONETARY DAMAGES FOR PROPOSED AMENDMENT: A QUORUM FOR SUCH MEETING BREACH OF FIDUCIARY DUTY. THE EXISTING CHARTER OR MATTER. (SEE NO SUBSEQUENT MODIFICATION PROVISION WOULD BE REVISED (2) BELOW). OR REPEAL OF THIS TO MATCH THE LANGUAGE IN PROVISION COULD REVOKE THE OTHER MARYLAND COMPANY THIS PROTECTION FOR EVENTS CHARTERS (SEE (1) BELOW) BETWEEN ADOPTION OF THE AND TO SPECIFICALLY PROVISION AND SUCH INDICATE THAT THE COMPANY MODIFICATION OR REPEAL. RESERVES THE RIGHT TO (SEE (4) BELOW). CHANGE THE "CONTRACT RIGHTS" OF OUTSTANDING SHARES. IN ADDITION, THE CHARTER WOULD CLARIFY THAT THE BOARD OF DIRECTORS, WITHOUT SHAREHOLDER ACTION, CAN INCREASE OR DECREASE THE AGGREGATE NUMBER OF SHARES THAT THE COMPANY HAS AUTHORITY TO ISSUE. COMPANY INDEMNIFICATION MASTER/FEEDER SHAREHOLDER VOTING REDEMPTION TRANSACTIONS FEES AND VOTE World EXISTING PROVISION: EXISTING PROVISION: EXISTING REQUIREMENT: EXISTING PROVISION: The Company's By-Laws None. One vote for each share None. provide that the Company held. shall indemnify directors, PROPOSED AMENDMENT: PROPOSED AMENDMENT: officers, employees and THE COMPANY WOULD HAVE PROPOSED AMENDMENT: THE COMPANY WOULD HAVE agents against judgments, EXPLICIT AUTHORITY TO ONE VOTE FOR EACH DOLLAR EXPLICIT AUTHORITY TO fines, settlements and INVEST ASSETS IN CASH OR OF NET ASSET VALUE SUBTRACT REDEMPTION FEES expenses to the extent IN INTERESTS ISSUED BY REPRESENTED BY SHARES AND OTHER CHARGES, AS permitted by law. The OTHER INVESTMENT HELD. (SEE (3) BELOW). DETERMINED BY THE BOARD OF Charter does not include COMPANIES. (SEE DIRECTORS, FROM THE AMOUNT any corresponding (6) BELOW). PAYABLE TO SHAREHOLDERS IN provisions. CONNECTION WITH A REDEMPTION BY SHAREHOLDERS PROPOSED AMENDMENT: OR BY THE COMPANY. THE THE CHARTER WOULD INCLUDE CHARTER WOULD ALSO CLARIFY A PROVISION (SEE THAT THE COMPANY CAN (5) BELOW) PROVIDING THAT REDEEM ALL OUTSTANDING THE COMPANY SHALL SHARES IN A FUND OR CLASS INDEMNIFY (a) CURRENT AND WITHOUT A SHAREHOLDER FORMER DIRECTORS AND VOTE. (SEE (7) BELOW). OFFICERS, TO THE EXTENT PERMITTED BY LAW, INCLUDING BY ADVANCE OF EXPENSES AND (b) OTHER EMPLOYEES AND AGENTS TO THE EXTENT APPROVED BY THE BOARD OF DIRECTORS AND PERMITTED BY LAW. AFTER ADOPTION OF THIS PROVISION, NO SUBSEQUENT AMENDMENT OR REPEAL COULD LIMIT THE INDEMNIFICATION PROTECTION WITH RESPECT TO ACTS OR OMISSIONS OCCURRING PRIOR TO SUCH AMENDMENT OR REPEAL.
The text of the proposed Charter Amendments summarized in the preceding table is set forth below: (1) The Corporation reserves the right from time to time to make any amendments to the charter of the Corporation which may now or hereafter be authorized by law, including any amendment altering the terms or contract rights, as expressly set forth in the charter of the Corporation, of any shares of its outstanding stock by classification, reclassification, or otherwise. In clarification and not limitation of the foregoing, a majority of the entire Board of Directors, without action by the stockholders, may amend the charter of the Corporation to increase or decrease the aggregate number of shares of stock or the number of shares of stock of any class or series that the Corporation has authority to issue. (All Maryland Companies) (2) At a meeting of stockholders the presence in person or by proxy of stockholders entitled to cast one-third of all the votes entitled to be cast at the meeting constitutes a quorum. At a meeting of 37 stockholders the presence in person or by proxy of stockholders entitled to cast one-third of all the votes entitled to be cast on any matter shall constitute a quorum for action on that matter (including matters on which fewer than all classes or series are entitled to vote). (All Maryland Companies) (3) Unless otherwise expressly provided in the charter of the Corporation, on each matter submitted to a vote of the stockholders, each holder of shares shall be entitled to one vote for each dollar of net asset value represented by each share standing in his name on the books of the Corporation, irrespective of the series or class thereof, and the exclusive voting power for all purposes shall be vested in the holders of Common Stock. (Sector Funds, PIP, and World) (4) A director or officer of the Corporation shall not be liable to the Corporation or its stockholders for monetary damages for breach of fiduciary duty as a director or officer, except to the extent such exemption from liability or limitation thereof is not permitted by law (including the Investment Company Act of 1940) as currently in effect or as the same may hereafter be amended. No amendment, modification or repeal of this Article shall adversely affect any right or protection of a director or officer that exists at the time of such amendment, modification or repeal. (Natural Resources, Small Cap, Emerging Growth, PIP, and World) (5) The Corporation shall indemnify (A) its current and former directors and officers, whether serving or having served the Corporation or at its request any other entity, to the full extent required or permitted by the General Laws of the State of Maryland now or hereafter in force (as limited by the Investment Company Act of 1940), including the advance of expenses under the procedures and to the full extent permitted by law, and (B) other employees and agents to such extent as shall be authorized by the Board of Directors or the Corporation's By-Laws and be permitted by law. The foregoing rights of indemnification shall not be exclusive of any other rights to which those seeking indemnification may be entitled. The Board of Directors may take such action as is necessary to carry out these indemnification provisions and is expressly empowered to adopt, approve and amend from time to time such by-laws, resolutions or contracts implementing such provisions or such further indemnification arrangements as may be permitted by law. No amendment of the charter of the Corporation or repeal of any of its provisions shall limit or eliminate the right to indemnification provided hereunder with respect to acts or omissions occurring prior to such amendment or repeal. (All Maryland Companies) (6) The Board of Directors is explicitly authorized to, without action by stockholders (unless such approval is required by the Investment Company Act of 1940), invest all or a portion of the assets of any series or class, or dispose of all or a portion of the assets of any series or class and invest the proceeds of such disposition, in cash or in interests issued by one or more other investment companies registered under the Investment Company Act of 1940. The Board of Directors is explicitly authorized to, without action by stockholders, cause a series or class that is organized in the master/feeder fund structure to withdraw or redeem its assets from the master fund and cause such series or class to invest its assets directly in cash or in securities and other financial instruments or in another master fund. (All Maryland Companies) (7) The appropriate sections of all Maryland Company Charters shall be modified as necessary to reflect the following provisions: All redemptions, whether by a stockholder or by the Corporation, shall be at a redemption price equal to the current net asset value per share as determined by the Board of Directors from time to time in accordance with the provisions of the charter and applicable law, less such redemption fee or other charge, if any, as may be fixed by resolution of the Board of Directors. A redemption by the Corporation in accordance with the charter of the Corporation, even if it is for all the shares of a series or class, shall not be considered a liquidation requiring a vote of stockholders. 38 MASSACHUSETTS SUMMARY AND TEXT OF CHARTER AMENDMENTS
SHAREHOLDERS MEETINGS IF LESS THAN A MAJORITY OF TRUSTEES ELECTED BY NUMBER OF TRUSTEES SHAREHOLDERS -------------------------------------- -------------------------------------- PROPOSED NAME EXISTING PROPOSED EXISTING PROPOSED COMPANY CHANGE REQUIREMENT AMENDMENT REQUIREMENT AMENDMENT - ------- ------------------ ------------------ ------------------ ------------------ ------------------ Value Number fixed by Number would be No applicable In the event less Trustees, not less fixed by Trustees, provision. than a majority of than 3 or more no upper or lower Trustees have been than 15. limit on number. elected by the Shareholders, to the extent required by the 1940 Act, but only to such extent, the Trustees then in office would be required to call a Shareholders' meeting for the election of Trustees.
DOLLAR VOTING SHARE CLASSIFICATION OR -------------------------------- RECLASSIFICATION QUORUM, ADJOURNMENT, PLURALITY EFFECT OF -------------------------------- -------------------------------- EXISTING PROPOSED EXISTING PROPOSED EXISTING PROPOSED COMPANY REQUIREMENT AMENDMENT REQUIREMENT AMENDMENT REQUIREMENT AMENDMENT - ------- --------------- --------------- --------------- --------------- --------------- --------------- Value No applicable Trustees, Trustees may, Trustees would By-Laws provide Holders of one- provision. without the in their have power, in that holders of third of the vote of the discretion, their a majority of Shares entitled Shareholders, divide the discretion, to outstanding to vote on a would determine Shares of any classify or shares of the matter would be on any vote put Fund into reclassify any Company or Fund a quorum. to the classes. unissued Shares of the Company Shares that Shareholders of a Fund or present in abstain or for whether voting class, or any person or by which the will be per Shares of any proxy and broker or Share voting or Fund or class entitled to nominee cannot dollar voting previously vote vote on all (net asset issued and constitutes a matters would value times thereafter quorum. count for the number of reacquired by purpose of shares owned). the Trust, into determining a one or more quorum. Funds or classes that may be established and designated from time to time.
39
SHAREHOLDER DERIVATIVE ACTIONS MANDATORY REDEMPTION ---------------------------------------------- ---------------------------------------------- COMPANY EXISTING REQUIREMENT PROPOSED AMENDMENT EXISTING REQUIREMENT PROPOSED AMENDMENT - ------- ---------------------- ---------------------- ---------------------- ---------------------- Value No applicable In order to bring a Only for excessively Any time (a) if the provision. derivative action, large or small Trustees determine in unless all the accounts. their sole discretion Trustees have a that redemption is in financial interest in the best interests of the suit, Shareholders the Shareholders or must (a) make a the holders of the pre-suit demand on the Shares of a Fund, or Trustees who do not (b) for account have a financial maintenance purposes. interest in the suit, (b) obtain holders of at least 10% of outstanding Shares to join such request and (c) afford the Trustees a reasonable amount of time to respond.
PROCEDURE FOR TERMINATION OF PROCEDURE FOR CHARTER COMPANY AMENDMENTS REORGANIZATION -------------------------------- -------------------------------- -------------------------------- EXISTING PROPOSED EXISTING PROPOSED EXISTING PROPOSED COMPANY REQUIREMENT AMENDMENT REQUIREMENT AMENDMENT REQUIREMENT AMENDMENT - ------- --------------- --------------- --------------- --------------- --------------- --------------- Value Company can be Company or any All charter Trustees, Vote of 2/3 of Reorganization terminated by Fund can be amendments, without outstanding would require (a) vote of terminated by other than Shareholder Shares of either holders of 2/3 (a) vote of clean-up action, would Company (a) vote of of Shares of holders of 2/3 matters such as be authorized required, or 2/3 of Shares each Fund at a of Shares of name changes, to amend majority of of Company (or meeting, each Fund or require the charter so long outstanding Fund being (b) majority of 2/3 vote of approval of a as such shares of the reorganized) Trustees, plus Fund being majority of the amendment does Company if (b) majority of vote of holders terminated, Shares not adversely recommended by outstanding of 2/3 of (b) if outstanding and affect the Trustees. shares of the Shares of each recommended by entitled to rights of any Company (or Fund without a the Trustees, vote. Shareholder. Fund being meeting, or the vote of reorganized) if (3) Trustees by holders of a recommended by written notice majority of Trustees or to the Shares of each (c) vote of a Shareholders. Fund or majority of the Funds can be majority vote Trustees. terminated by of Fund being Shareholders vote of 2/3 of terminated, or would not have Shares in such (3) Trustees by appraisal Fund. written notice rights in a to the reorganization. Shareholders. Trustees would have the power, without a vote of the Shareholders, to invest the property of the Trust or any Fund in one or more other investment companies.
40 - Section 2.1 of the Declaration shall be amended to read as follows: 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. - Section 2.4 of the Declaration shall be amended to add the following sentence at the end of the Section: In the event that less than the majority of Trustees holding office have been elected by the Shareholders, to the extent required by the 1940 Act, but only to such extent, the Trustees then in office shall call a Shareholders' meeting for the election of Trustees. - Section 6.8 of the Declaration shall be amended to add the following sentences at the end of the Section: As determined by the Trustees without the vote or consent of Shareholders (except as required by the 1940 Act), on any matter submitted to a vote of Shareholders, either (i) 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 or (ii) each dollar of net asset value (number of Shares owned times net asset value per share of such series or class, as applicable) shall be entitled to one vote on any matter on which such Shares are entitled to vote and each fractional dollar amount shall be entitled to a proportionate fractional vote. Unless the Trustees designate otherwise in accordance with the preceding sentence, 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. - The first sentence of the second paragraph of Section 6.9 of the Declaration shall be amended to read as follows: The Trustees, in their discretion, without a vote of Shareholders, may classify or reclassify any unissued Shares of a series or class, or any Shares of any series or class previously issued and thereafter reacquired by the Trust, into Shares of one or more other series or classes that may be established and designated from time to time. - A new Section 6.10 of the Declaration shall be added, reading as follows: QUORUM AND REQUIRED VOTE. One-third of the Shares entitled to vote on a matter shall be a quorum for the transaction of business with respect to such matter at a Shareholders' meeting. Shares that abstain or do not vote with respect to one or more proposals presented for Shareholder approval at any Shareholders' meeting and Shares held in "street name" as to which the broker or nominee with respect thereto indicates on the proxy that it does not have discretionary authority to vote with respect to a particular proposal, will be counted for purposes of determining whether a quorum is present at a meeting, but will not be counted as Shares voted with respect to any such proposal. A majority of the shares present at a meeting (regardless of whether they are authorized to vote on all the matters to be presented to the meeting) shall be sufficient to approve adjournments. Any adjourned session or sessions may be held within a reasonable time after the date set for the original meeting without the necessity of further notice. A Majority Shareholder Vote at a meeting of which a quorum is present shall decide any question, except (1) a plurality vote in the case of the election of Trustees, or (2) when a different vote is required or permitted by any provision of the 1940 Act or other applicable law or by this Declaration or the By-Laws, or when the Trustees shall in their discretion require a larger vote or the vote of a majority or larger fraction of the Shares of one or more particular series or classes. 41 - A new Section 6.11 of the Declaration shall be added, reading as follows: A Shareholder may bring a derivative action on behalf of the Trust only if the following conditions are met: (a) The Shareholder or Shareholders must make a pre-suit demand upon the Trustees to bring the subject action unless an effort to cause the Trustees to bring such an action is not likely to succeed. For purposes of this Section 6.11(a), a demand on the Trustees shall only be deemed not likely to succeed and therefore excused if a majority of the Board of Trustees, or a majority of any committee established to consider the merits of such action, is composed of Trustees who have a personal financial interest in the transaction at issue; (b) Unless a demand is not required under paragraph (a) of this Section 6.11, Shareholders eligible to bring such derivative action who collectively hold at least 10% of the outstanding Shares of the Trust, or who collectively hold at least 10% of the outstanding Shares of the Series or Class to which such action relates, shall join in the request for the Trustees to commence such action; and (c) Unless a demand is not required under paragraph (a) of this Section 6.11, the Trustees must be afforded a reasonable amount of time to consider such Shareholder request and to investigate the basis of such claim. The Trustees shall be entitled to retain counsel or other advisors in considering the merits of the request and shall require an undertaking by the Shareholders making such request to reimburse the Trust for the expense of any such advisors in the event that the Trustees determine not to bring such action. (d) For purposes of this Section 6.11, the Board of Trustees may designate a committee of one Trustee to consider a Shareholder demand if necessary to create a committee with a majority of Trustees who do not have a personal financial interest in the transaction at issue. - Section 7.3 of the Declaration shall be amended in its entirety to read as follows: REDEMPTION AT THE OPTION OF THE TRUST. Each Share of any series shall be subject to redemption at the option of the Trust: (i) at any time, if the Trustees determine in their sole discretion that such redemption is in the best interests of 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. Upon such redemption the holders of the Shares so redeemed shall have no further right with respect thereto other than to receive payment of the redemption price for such shares. - The first sentence of Section 9.2(a) of the Declaration shall be amended in its entirety to read as follows: The Trust or any series may be terminated by (1) the affirmative vote of the holders of not less than two-thirds of the Shares of each series of the Trust in case of a termination of the Trust or the affirmative vote of the holders of not less than two-thirds of the series being terminated in the case of a termination of a series, (2) if the termination is recommended by a majority of the Trustees, a Majority Shareholder Vote or a Majority Shareholder Vote of the series being terminated in the case of a termination of a series, or (3) by the Trustees by written notice to the Shareholders of the Trust or the series being terminated. - Sections 9.3(a) and (b) of the Declaration shall be amended in their entirety to read as follows: (a) The provisions of this Declaration (whether or not related to the rights of Shareholders) may be amended at any time, so long as such amendment does not adversely affect the rights of any Shareholder with respect to which such amendment is or purports to be applicable and so long as such amendment is not in contravention of applicable law, including the 1940 Act, by an instrument in writing signed by a majority of the Trustees (or by an officer of the Trust pursuant 42 to the vote of a majority of the Trustees). Any amendment to this Declaration that adversely affects the rights of all Shareholders may be adopted at any time by an instrument in writing signed by a majority of the Trustees (or by an officer of the Trust pursuant to a vote of a majority of the Trustees) when authorized to do so by the vote in accordance with SECTION 6.8 hereof of Shareholders holding a majority of all the Shares outstanding and entitled to vote, without regard to series, or if said amendment adversely affects the rights of the Shareholders of less than all of the series, or of less than all of the classes of any series having classes, by the vote of the holders of a majority of all the Shares entitled to vote of each series or class, as the case may be, so affected. (b) 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 a series or to permit assessments upon Shareholders. - Section 9.4 of the Declaration shall be amended in its entirety to read as follows: The Trustees may sell, convey and transfer all or substantially all of the assets of the Trust, or the assets of any one or more series of the Trust, to another trust, partnership, association or corporation organized under the laws of any state of the United States, or may transfer the assets of one series of the Trust to another series of the Trust, in exchange for cash, shares of the transferee or other securities, or to the extent permitted by law then in effect may merge or consolidate the Trust or any series with any other trust or any corporation, partnership, or association organized under the laws of any state of the United States, all upon such terms and conditions and for such consideration when and as authorized by (a) the affirmative vote of not less than two-thirds of the outstanding Shares of each series of the Trust in the case of the reorganization of the Trust, or by the affirmative vote of not less than two-thirds of the outstanding Shares of a particular series in the case of the reorganization of a particular series, provided, however, that if such merger, consolidation or sale is recommended by the Trustees, a Majority Shareholder Vote, or a vote of the majority of the outstanding Shares in such series, shall be sufficient, or (b) a vote or written consent of a majority of the Trustees. Shareholders shall not have appraisal rights in connection with any such transaction. Following such transfer, the Trustees shall distribute the cash, shares or other securities or other consideration received in such transaction (giving due effect to the assets belonging to and indebtedness of, and any other differences among, the various series whose assets have so been transferred) among the Shareholders of such series; and if all of the assets of the Trust have been so transferred, the Trust shall be terminated. Notwithstanding anything else herein, the Trustees may, without Shareholder approval unless such approval is required by the 1940 Act, invest all or a portion of the Trust Property of any series, or dispose of all or a portion of the Trust Property of any series, and invest the proceeds of such disposition in interests issued by one or more other investment companies registered under the 1940 Act. Any such other investment company may (but need not) be a trust (formed under the laws of the Commonwealth of Massachusetts or any other state or jurisdiction) (or subtrust thereof) which is classified as a partnership for federal income tax purposes. Notwithstanding anything else herein, the Trustees may, without Shareholder approval unless such approval is required by the 1940 Act, cause a series that is organized in the master/ feeder fund structure to withdraw or redeem its Trust Property from the master fund and cause such series to invest its Trust Property directly in securities and other financial instruments or in another master fund. REQUIRED VOTE Approval of this proposal as to each Delaware Company requires an affirmative vote of a majority of each Company's voted shares. Approval of this Proposal for Value requires the affirmative vote of two-thirds of the Fund's outstanding shares. Approval of this proposal as to each Maryland Company requires an affirmative vote of a majority of each such Company's outstanding voting securities entitled to vote thereon and in the case of PIP, Sector Funds and World, of the outstanding voting securities of each Fund. EACH BOARD, INCLUDING THE INDEPENDENT BOARD MEMBERS, RECOMMENDS THAT YOU VOTE "FOR" PROPOSAL NO. 2. 43 ADDITIONAL INFORMATION The solicitation of proxies, the cost of which will be borne by the Funds, will be made primarily by mail but also may include telephone or oral communications by regular employees of Prudential Securities or PI, who will not receive any compensation therefore from the Funds, or by Georgeson Shareholder Communications Inc., a proxy solicitation firm retained by the Funds, who will be paid the approximate fees and expenses for soliciting services set forth below. Proxies may be recorded pursuant to (i) electronically transmitted instructions or (ii) telephone instructions obtained through procedures reasonably designed to verify that the instructions have been authorized. Soliciting fees and expenses payable to Georgeson Shareholder Communications Inc. by a particular Fund are a function of the number of shareholders in that Fund. All of the cost of the Meetings will be borne by the Funds.
ESTIMATED SOLICITATION FUND FEES AND EXPENSES - ---- ---------------------- 20/20.................................................. $ 194,000 Equity................................................. $ 591,400 INDEX SERIES Stock Index............................... $ 393,300 Natural Resources...................................... $ 32,000 SECTOR FUNDS Financial Services........................ $ 60,000 SECTOR FUNDS Health Sciences........................... $ 109,200 SECTOR FUNDS Technology................................ $ 138,600 SECTOR FUNDS Utility................................... $ 517,000 Small Company.......................................... $ 185,450 TAX MANAGED Tax Equity................................. $ 41,200 Small Cap.............................................. $ 29,200 Emerging Growth........................................ $ 243,900 Value.................................................. $ 267,600 PIP Active Balanced.................................... $ 186,900 PIP Equity Opportunity................................. $ 271,000 PIP Growth............................................. $1,369,100 Real Estate............................................ $ 15,500 WORLD Global Growth.................................... $ 188,800 WORLD International Value.............................. $ 174,900 WORLD International Growth............................. $ 55,300
SHAREHOLDER PROPOSALS The Companies will not be required to hold annual meetings of shareholders if the election of Board Members is not required under the 1940 Act. It is the present intention of the Board of each Company not to hold annual meetings of shareholders unless such shareholder action is required. Any shareholder who wishes to submit a proposal to be considered at a Company's next meeting of shareholders should send the proposal to that Fund at Gateway Center Three, 100 Mulberry Street, 4th Floor, Newark, New Jersey 07102, so as to be received within a reasonable time before the Board makes the solicitation relating to such meeting, in order to be included in the proxy statement and form of proxy relating to such meeting or be brought before such meeting without being included in the proxy statement. Shareholder proposals that are submitted in a timely manner will not necessarily be included in the Company's proxy materials. Inclusion of such proposals is subject to limitations under the federal securities laws. 44 OTHER BUSINESS Management knows of no business to be presented at the Meetings other than the matters set forth in this proxy statement, but should any other matter requiring a vote of shareholders arise, the proxies will vote according to their best judgment in the interest of each Fund, respectively. /s/ Maria G. Master /s/ Jonathan D. Shain Maria G. Master Jonathan D. Shain SECRETARY SECRETARY PRUDENTIAL 20/20 FOCUS FUND PRUDENTIAL REAL ESTATE SECURITIES FUND PRUDENTIAL EQUITY FUND, INC. PRUDENTIAL WORLD FUND, INC. PRUDENTIAL INDEX SERIES FUND Prudential Global Growth Fund Prudential Stock Index Fund Prudential International Value Fund PRUDENTIAL NATURAL RESOURCES FUND, INC. Prudential Jennison International Growth Fund PRUDENTIAL SECTOR FUNDS, INC. Prudential Financial Services Fund Prudential Health Sciences Fund Prudential Technology Fund Prudential Utility Fund PRUDENTIAL SMALL COMPANY FUND, INC. PRUDENTIAL TAX-MANAGED FUNDS Prudential Tax-Managed Equity Fund PRUDENTIAL TAX-MANAGED SMALL-CAP FUND, INC. PRUDENTIAL U.S. EMERGING GROWTH FUND, INC. PRUDENTIAL VALUE FUND THE PRUDENTIAL INVESTMENT PORTFOLIOS, INC. Prudential Active Balanced Fund Prudential Jennison Equity Opportunity Fund Prudential Jennison Growth Fund
[ ], 2003 It is important that you execute and return ALL of your proxies promptly. 45 INDEX TO EXHIBITS TO PROXY STATEMENT Exhibit A Five Percent Shareholder Report Exhibit B Board and Committee Information Exhibit C Officer Information
46 EXHIBIT A FIVE PERCENT SHAREHOLDER REPORT As of May 16, 2003, the beneficial owners, directly or indirectly, of more than 5% of any class of the outstanding shares of the Funds are listed below.
FUND NAME REGISTRATION SHARES/CLASS PERCENT - --------- --------------------------------------- ------------ -------- 20/20..................................... Equity.................................... INDEX SERIES Stock Index.................. Natural Resources......................... SECTOR FUNDS Financial Services........... SECTOR FUNDS Health Sciences.............. SECTOR FUNDS Technology................... SECTOR FUNDS Utility...................... Small Company............................. TAX MANAGED Tax Equity.................... Small Cap................................. Emerging Growth........................... Value..................................... PIP Active Balanced....................... PIP Equity Opportunity.................... PIP Growth................................ Real Estate............................... WORLD Global Growth....................... WORLD International Value................. WORLD International Growth................
A-1 EXHIBIT B BOARD AND COMMITTEE INFORMATION(1)
INDEX NATURAL SECTOR SMALL TAX SMALL EMERGING ANNUAL FEE(2) 20/20 EQUITY SERIES RESOURCES FUNDS COMPANY MANAGED CAP GROWTH - ------------- -------- -------- -------- --------- --------- --------- --------- -------- --------- Fee for Attendance at Board Meetings(2).............. N/A N/A N/A N/A N/A N/A N/A N/A N/A Fee for Attendance at Committee Meetings(2).... N/A N/A N/A N/A N/A N/A N/A N/A N/A Number of Board Meetings during the Last Fiscal Year..................... 4 4 4 4 4 4 4 4 4 Number of Audit Committee Meetings during the Last Fiscal Year*............. 4 4 4 4 4 4 4 4 4 Number of Nominating Committee Meetings during the Last Fiscal Year*.... -- -- -- -- -- -- -- -- -- Size of Current Board...... 13 13 13 13 13 13 13 13 13 REAL ANNUAL FEE(2) VALUE PIP ESTATE WORLD - ------------- -------- -------- -------- -------- Fee for Attendance at Board Meetings(2).............. N/A N/A N/A N/A Fee for Attendance at Committee Meetings(2).... N/A N/A N/A N/A Number of Board Meetings during the Last Fiscal Year..................... 4 4 4 4 Number of Audit Committee Meetings during the Last Fiscal Year*............. 4 4 4 4 Number of Nominating Committee Meetings during the Last Fiscal Year*.... -- -- -- -- Size of Current Board...... 13 13 9 9
* Only the Independent Directors/Trustees serve on a Company's Audit and Nominating Committees. (1) No fund within the Fund Complex has a bonus, pension, profit sharing or retirement plan. (2) While Board and Committee members do not receive attendance fees, they do receive compensation for Board and certain Committee membership. See page 13-15 of this proxy statement. No incumbent Director/Trustee attended fewer than 75% of the total number of Board and Committee meetings during the last fiscal year of each Company. B-1 EXHIBIT C(i) OFFICER INFORMATION
NAME, AGE, PRINCIPAL OFFICER SINCE BUSINESS OCCUPATION FOR THE ----------------------------------------- PAST FIVE YEARS OFFICE 20F* EQF* PISF* NRF* PSF* SCF* TXM* - --------------------------- ------------- ----- ----- ----- ----- ----- ----- ----- Judy A. Rice (55) President 2000 2000 2000 2000 2000 2000 2000 President, Chief Executive Officer, Chief Operating Officer and Officer-In-Charge (since 2003) of PI; formerly various positions to Senior Vice President (1992-1999) of PSI; and various positions to Managing Director (1975-1992) of Salomon Smith Barney; Member of Board of Governors of the Money Management Institute. Robert F. Gunia (56) Vice 1997 1987 1992 1987 1987 1987 1998 Executive Vice President and Chief President Administrative Officer (since June 1999) of PI; Executive Vice President and Treasurer (since January 1996) of PI; President (since April 1999) of PIMS; Corporate Vice President (since September 1997) of The Prudential Insurance Company of America (Prudential); formerly Senior Vice President (March 1987-May 1999) of Prudential Securities Incorporated (Prudential Securities); formerly Chief Administrative Officer (July 1989-September 1996), Director (January 1989-September 1996), and Executive Vice President, Treasurer and Chief Financial Officer (June 1987-December 1996) of Prudential Mutual Fund Management, Inc. (PMF); Vice President and Director (since May 1989) and Treasurer (since 1999) of The Asia Pacific Fund, Inc. Grace C. Torres (43) Treasurer & 1997 1998 1997 1997 1998 1998 1998 Senior Vice President (since Principal January 2000) of PI; formerly Financial and First Vice President (December Accounting 1996-January 2000) of PI and First Officer Vice President (March 1993-1999) of PSI. Maria G. Master (32) Secretary 2002 2002 2002 2002 2002 2002 2002 Vice President and Corporate Counsel (since August 2001) of Prudential; formerly Financial/Economic Analyst with the Federal Reserve Bank of New York (April 1999-July 2001), Associate Attorney of Swidler Berlin Shereff Friedman LLP (March 1997-April 1999) and Associate Attorney of Riker, Danzig, Scherer, Hyland & Perretti LLP (August 1995-March 1997). Jonathan D. Shain (44) Secretary N/A N/A N/A N/A N/A N/A N/A Vice President and Corporate Counsel (since August 1998) of Prudential; formerly Attorney with Fleet Bank, N.A. (January 1997-July 1998) and Associate Counsel (August 1994-January 1997) of New York Life Insurance Company. Marguerite E.H. Morrison (47) Assistant 2002 2002 2002 2002 2002 2002 2002 Vice President and Chief Legal Secretary Officer-Mutual Funds and Unit Investment Trusts (since August 2000) of Prudential; Senior Vice President and Assistant Secretary (since February 2001) of PI; Vice President and Assistant Secretary of PIMS (since October 2001), previously Vice President and Associate General Counsel (December 1996-February 2001) of PI and Vice President and Associate General Counsel (September 1987-September 1996) of PSI. Maryanne Ryan (38) Anti-Money 2002 2002 2002 2002 2002 2002 2002 Vice President, Prudential (since Laundering November 1998), First Vice Compliance President of PSI (March 1997-May Officer 1998).
- ---------------------------------- * 20F=20/20; EQF=Equity; PSIF=Index Series; NRF=Natural Resources; PSF=Sector Funds; SCF=Small Company; TXM=Tax Managed C-1 EXHIBIT C(ii)
NAME, AGE, PRINCIPAL OFFICER SINCE BUSINESS OCCUPATION FOR THE ------------------------------------ PAST FIVE YEARS OFFICE SCQ** EMF** PVF** PIP** RESF** WLD** - --------------------------- ------------- ----- ----- ----- ----- ------ ----- Judy A. Rice (55) President 2000 2000 2000 2000 2000 2000 President, Chief Executive Officer, Chief Operating Officer and Officer-In-Charge (since 2003) of PI; formerly various positions to Senior Vice President (1992-1999) of PSI; and various positions to Managing Director (1975-1992) of Salomon Smith Barney; Member of Board of Governors of the Money Management Institute. Robert F. Gunia (56) Vice 1998 1996 1987 1995 1997 1996 Executive Vice President and Chief President Administrative Officer (since June 1999) of PI; Executive Vice President and Treasurer (since January 1996) of PI; President (since April 1999) of PIMS; Corporate Vice President (since September 1997) of The Prudential Insurance Company of America (Prudential); formerly Senior Vice President (March 1987-May 1999) of Prudential Securities Incorporated (Prudential Securities); formerly Chief Administrative Officer (July 1989-September 1996), Director (January 1989-September 1996), and Executive Vice President, Treasurer and Chief Financial Officer (June 1987-December 1996) of Prudential Mutual Fund Management, Inc. (PMF); Vice President and Director (since May 1989) and Treasurer (since 1999) of The Asia Pacific Fund, Inc. Grace C. Torres (43) Treasurer & 1997 1996 1997 1998 1997 1995 Senior Vice President (since Principal January 2000) of PI; formerly Financial and First Vice President (December Accounting 1996-January 2000) of PI and First Officer Vice President (March 1993-1999) of Prudential Securities. Maria G. Master (32) Secretary 2002 2002 2002 2002 N/A N/A Vice President and Corporate Counsel (since August 2001) of Prudential; formerly Financial/Economic Analyst with the Federal Reserve Bank of New York (April 1999-July 2001), Associate Attorney of Swidler Berlin Shereff Friedman LLP (March 1997-April 1999) and Associate Attorney of Riker, Danzig, Scherer, Hyland & Perretti LLP (August 1995-March 1997). Jonathan D. Shain (44) Secretary N/A N/A N/A N/A 2001 2001 Vice President and Corporate Counsel (since August 1998) of Prudential; formerly Attorney with Fleet Bank, N.A. (January 1997-July 1998) and Associate Counsel (August 1994-January 1997) of New York Life Insurance Company. Marguerite E.H. Morrison (46) Assistant 2002 2002 2002 2002 2002 2002 Vice President and Chief Legal Secretary Officer-Mutual Funds and Unit Investment Trusts (since August 2000) of Prudential; Senior Vice President and Assistant Secretary (since February 2001) of PI; Vice President and Assistant Secretary of PIMS (since October 2001), previously Vice President and Associate General Counsel (December 1996-February 2001) of PI and Vice President and Associate General Counsel (September 1987-September 1996) of PSI. Maryanne Ryan (38) Anti-Money 2002 2002 2002 2002 2002 2002 Vice President, Prudential (since Laundering November 1998), First Vice Compliance President of PSI (March 1997-May Officer 1998).
- ---------------------------------- ** SCQ=Small Cap; EMF=Emerging Growth; PVF=Value; RESF=Real Estate; WLD=World C-2 - -------------------------------------------------------------------------------- PRUDENTIAL [ ] FUND GATEWAY CENTER THREE NEWARK, NJ 07102 PROXY JOINT SPECIAL MEETINGS OF SHAREHOLDERS JULY 17, 2003, 9:30 A.M. THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS (OR TRUSTEES). The undersigned hereby appoints Grace C. Torres, Marguerite E.H. Morrison and Maria G. Master as Proxies, each with full power of substitution, and hereby authorizes each of them to represent and to vote, as designated on the reverse side, all the shares of Common Stock of the Fund held of record by the undersigned on May 16, 2003 at the Meeting to be held on July 17, 2003 or any adjournment thereof. THE SHARES REPRESENTED BY THE PROXY, WHEN THIS PROXY IS PROPERLY EXECUTED, WILL BE VOTED IN THE MANNER DIRECTED HEREIN BY THE UNDERSIGNED SHAREHOLDER. THE PROXY WILL BE VOTED FOR THE NOMINEES AND FOR PROPOSAL 2, IF YOU DO NOT SPECIFY OTHERWISE, PLEASE REFER TO THE PROXY STATEMENT DATED MAY 15 FOR DISCUSSION OF THE PROPOSAL. IF VOTING BY MAIL, PLEASE MARK, SIGN AND DATE THIS PROXY CARD WHERE INDICATED AND RETURN IT PROMPTLY USING THE ENCLOSED ENVELOPE WHICH REQUIRES NO POSTAGE IF MAILED IN THE UNITED STATES. In their discretion, the Proxies are authorized to vote upon such other business as may properly come before the Meeting or any adjournment thereof. PRUDENTIAL INVESTMENTS GATEWAY CENTER THREE 100 MULBERRY STREET NEWARK, NJ 07102-4077 TO VOTE BY TELEPHONE 1) Read the Proxy Statement and have the proxy card below at hand. 2) Call 1-800-690-6903 3) Enter the 12-digit control number set forth on the proxy card and follow the simple instructions. TO VOTE BY INTERNET 1) Read the Proxy Statement and have the proxy card below at hand. 2) Go to Website www.proxyvote.com 3) Enter the 12-digit control number set forth on the proxy card and follow the simple instructions. TO VOTE BY MAIL 1) Read the Proxy Statement. 2) Check the appropriate boxes on the proxy card below. 3) Sign and date the proxy card. 4) Return the proxy card in the envelope provided. TO VOTE, MARK BLOCKS IN BLUE OR BLACK INK AS FOLLOWS: KEEP THIS PORTION FOR YOUR RECORDS - -------------------------------------------------------------------------------- DETACH AND RETURN THIS PORTION ONLY THIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED. _______________ Fund THE BOARD OF DIRECTORS (OR TRUSTEES) RECOMMENDS A VOTE FOR ALL OF THE NOMINEES AND THE PROPOSAL. VOTE ON DIRECTORS (OR TRUSTEES). 1) To elect ten Directors (or Trustees). Nominees: 01) David E. A. Carson, 02) Robert E. La Blanc, 03) Douglas H. McCorkindale, 04) Stephen P. Munn, 05) Richard A. Redeker, 06) Robin B. Smith, 07) Stephen Stoneburn, 08) Clay T. Whitehead, 09) Judy A. Rice, 10) Robert F. Gunia FOR WITHHOLD FOR ALL TO WITHHOLD AUTHORITY TO VOTE FOR ONE OR MORE ALL ALL EXCEPT NOMINEES, MARK "FOR ALL EXCEPT" AND WRITE THE NUMBER(S) OF SUCH NOMINEE(S) ON THE LINE BELOW. / / / / / / ______________________________________________ FOR AGAINST ABSTAIN VOTE ON PROPOSAL 2) To Approve Amendments to Each Fund's / / / / / / Articles of Incorporation or Declaration of Trust. NOTE: Please sign exactly as name appears hereon. Joint owners should each sign. When signing as attorney, executor, administrator, trustee or guardian, please give full title as such. If a corporation, please sign in full corporate name by president or other authorized officer. If a partnership, please sign in partnership name by authorized person. _________________________________ __________ SIGNATURE (PLEASE SIGN WITHIN BOX) DATE _________________________________ __________ SIGNATURE (JOINT OWNERS) DATE -----END PRIVACY-ENHANCED MESSAGE-----