UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
SCHEDULE 14A
(Rule 14a-101)
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934 (Amendment No. )
Filed by the Registrant
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Filed by a Party other than the Registrant
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Check the appropriate box:
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Preliminary Proxy Statement
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Confidential, For Use of the Commission Only (as permitted by
Rule 14a-6(e)(2))
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Definitive Proxy Statement
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Definitive Additional Materials
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Soliciting Material Under Rule 14a-12
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PIMCO MUNICIPAL ADVANTAGE FUND INC.
1345 Avenue of the Americas
New York, New York 10105
(Name of Registrant as Specified In Its Charter)
(Name of Person(s) Filing Proxy Statement, if Other Than the Registrant)
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Payment
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of Filing Fee (Check the appropriate box):
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No fee required.
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Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
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1)
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Title of each class of securities to which transaction applies:
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Aggregate number of securities to which transaction applies:
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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):
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4)
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Proposed maximum aggregate value of transaction:
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5)
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Total fee paid:
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Fee paid previously with preliminary materials:
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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.
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1)
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Amount previously paid:
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2)
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Form, Schedule or Registration Statement No.:
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Filing Party:
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4)
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Date Filed:
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PROXY
STATEMENT
PIMCO MUNICIPAL ADVANTAGE FUND INC.
Questions &
Answers
Relating
to the Proposed Liquidation and Dissolution
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Q.
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WHAT IS THIS DOCUMENT AND WHY DID WE SEND IT TO YOU?
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A.
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This booklet contains the Notice of Annual Meeting of
Stockholders (the Notice) of PIMCO Municipal
Advantage Fund Inc. (MAF or the
Fund) and Proxy Statement, which provide you with
information you should review before voting on the proposals to
elect Directors of the Fund and to liquidate and dissolve the
Fund (the Liquidation) that will be presented at the
Annual Meeting of Stockholders (the Meeting).
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On December 22, 2008, the Directors of the Fund approved
and declared advisable the Liquidation and directed that the
Liquidation pursuant to a Plan of Liquidation and Dissolution
(the Plan) be submitted to stockholders for approval
at the Meeting. You are receiving this proxy material because
you own shares of the Fund. The Liquidation will not occur
unless it is approved by the Funds Stockholders as
described in the Proxy Statement.
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WHO IS ELIGIBLE TO VOTE?
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A.
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Stockholders of record at the close of business on
December 29, 2008 (the Record Date) are
entitled to vote at the Meeting or any adjournment or
postponement of the Meeting. If you owned shares on the Record
Date, you have the right to vote even if you later sold the
shares.
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Approval of Proposal I (the election of Directors) will
require the affirmative vote of a plurality of the votes cast of
the Common Stockholders and Preferred Stockholders, voting as a
single class. Approval of Proposal II (the
Liquidation) will require the affirmative vote of at
least a majority of the votes entitled to be cast by holders of
Common Shares and Preferred Shares of the Fund, voting together
as a single class. Shares represented by properly executed
proxies, unless revoked before or at the Meeting, will be voted
according to Stockholders instructions. If you sign and
return a proxy card but do not fill in a vote for
Proposal I or Proposal II, your shares will be voted
FOR all of the Director nominees and FOR
the Liquidation. If any other business properly comes before the
Meeting, your shares will be voted at the discretion of the
persons named as proxies.
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WHY IS THE LIQUIDATION BEING PROPOSED?
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A.
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As discussed in the Proxy Statement, in February 2008, the Board
adopted a discount control policy, intended to reduce the
discount to net asset value (NAV) at which the
Funds Common Shares trade. While the discount has
narrowed, the Funds Common Shares have continued to trade
at a discount to NAV for most of 2008. The Board and Fund
management have been monitoring the trading discount and
considering the appropriate steps to be taken under the discount
policy. After reviewing with the Board various options for the
Fund, at a special meeting of the Board of Directors held on
December 22, 2008, management recommended to the Board that
liquidation is the most viable option for implementing the
discount policy and allowing Common Stockholders to realize NAV
for their shares. Following review and discussions with
management, the Board of Directors, including all of the
Directors who are not interested persons of the Fund
(as that term is defined in the Investment Company Act of 1940,
as amended (the 1940 Act)), with the advice and
assistance of independent counsel, determined that the proposed
Liquidation is in the best interests of the Fund and its
Stockholders, approved the Liquidation and the Plan, and
directed that the proposed Liquidation and Plan be submitted for
the vote of the Funds Stockholders.
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WHEN WILL THE LIQUIDATION AND DISTRIBUTIONS TO STOCKHOLDERS
OCCUR?
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If the Common and Preferred Stockholders approve the Plan,
management, under the oversight of the Directors and officers of
the Fund will proceed to wind up the Funds affairs as soon
as reasonably practicable thereafter in a timeframe that allows
for an orderly liquidation of portfolio holdings under
then-current market conditions. The Fund cannot predict at this
time how long it will take to accomplish an orderly liquidation.
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WHAT WILL I RECEIVE IN THE EVENT THE PLAN OF LIQUIDATION IS
APPROVED?
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If you are a Preferred Stockholder, you will receive the amount
of $50,000 per each share of preferred stock that you own, plus
an amount equal to all accumulated but unpaid dividends thereon
(whether or not earned or declared) to but not including the
date of such liquidating distribution, in
same-day
funds. In the event the assets of the Fund available for
distribution upon liquidation to the Preferred Stockholders are
insufficient to make full payments to which such holders are
entitled in accordance with the Bylaws of the Fund, payment
shall be made pro rata among all such Preferred Stockholders. If
you are a Common Stockholder, you will receive your pro rata
share of what is left for each share of common stock of the Fund
that you own, net of expenses associated with the Liquidation.
The actual amount to be received by Common Stockholders is
subject to significant uncertainties and is not possible to
predict at this time.
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WHAT WILL HAPPEN IF THE PLAN OF LIQUIDATION IS NOT APPROVED BY
THE FUNDS STOCKHOLDERS?
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If the proposed Liquidation and Plan is not approved by the
Funds Stockholders, the Fund will continue to operate as
an investment company, with the same investment objectives as in
the past, while the Funds Directors consider whether
another course of action would benefit the Fund and its
Stockholders.
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DO I NEED TO VOTE MY SHARES WITH RESPECT TO THE
PROPOSAL TO ELECT DIRECTORS IF I VOTE TO APPROVE THE PLAN
OF LIQUIDATION?
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Yes. You should vote your shares with respect to all the
proposals set forth in the accompanying proxy statement.
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WHY IS THE BOARD REQUESTING MY VOTE?
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A.
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Maryland law and the Funds Charter require the Fund to
obtain stockholder approval prior to the liquidation and
dissolution of the Fund. Consequently the Board is seeking your
vote on the Liquidation.
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HOW DOES THE BOARD RECOMMEND YOU VOTE?
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The Board recommends that you vote FOR all of the
Director nominees and FOR the Liquidation.
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Q.
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HOW CAN I VOTE MY SHARES?
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A.
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Please follow the instructions included on the enclosed proxy
card.
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Q.
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WHAT IF I WANT TO REVOKE MY PROXY?
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A.
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You can revoke your proxy at any time prior to its exercise by
(i) giving written notice to the Secretary of the Fund at
1345 Avenue of the Americas, New York, New York 10105,
(ii) by authorizing a later-dated proxy (either by signing
and mailing another proxy card, or by calling Broadridge
Financial Solutions, Inc. (the Proxy Solicitor) at
1-866-450-8469) or (iii) by attending the Meeting,
requesting return of any previously delivered proxy and voting
in person.
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Q.
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WHOM DO I CALL IF I HAVE QUESTIONS REGARDING THE PROXY?
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A.
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You can call the Proxy Solicitor at 1-866-450-8469.
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PIMCO MUNICIPAL ADVANTAGE
FUND INC.
c/o Allianz
Global Investors Fund Management LLC
1345 Avenue of the Americas
New York, New York 10105
NOTICE OF ANNUAL MEETING OF
STOCKHOLDERS
TO BE HELD ON FEBRUARY 26, 2009
To the Stockholders of PIMCO Municipal Advantage Fund Inc.
(MAF or the Fund):
Notice is hereby given that the Annual Meeting of Stockholders
(the Meeting) of the Fund will be held at the
offices of Allianz Global Investors Fund Management LLC
(AGIFM or the Manager), at 1345 Avenue
of the Americas, between West 54th and West 55th Streets,
49th Floor, New York, New York 10105, on Thursday,
February 26, 2009 at 9:30 A.M., Eastern Time, for the
following purposes, all of which are more fully described in the
accompanying Proxy Statement dated February 4, 2009:
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I.
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To elect Directors of the Fund, each to hold office for the term
indicated and until his or her successor shall have been elected
and qualified;
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II.
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To approve a proposal to liquidate and dissolve the Fund, as set
forth in the Plan of Liquidation and Dissolution adopted by the
Board of Directors of the Fund; and
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III.
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To transact such other business as may properly come before the
Meeting or any adjournments or postponements thereof.
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The Board of Directors of the Fund has fixed the close of
business on December 29, 2008 as the record date for the
determination of stockholders entitled to notice of, and to vote
at, the Meeting or any adjournment or postponement thereof (the
Record Date). The enclosed proxy is being solicited
on behalf of the Board of Directors of the Fund.
The Board of Directors of the Fund recommends a vote
FOR Proposals I and II.
By order of the Board of Directors of the Fund
Thomas J. Fuccillo
Secretary
New York, New York
February 4, 2009
It is important that your shares be represented at the
Meeting in person or by proxy, no matter how many shares you
own. If you do not expect to attend the Meeting, please
complete, date, sign and return the applicable enclosed proxy or
proxies in the accompanying envelope, which requires no postage
if mailed in the United States. Please mark and mail your proxy
or proxies promptly in order to save the Fund any additional
costs of further proxy solicitations and in order for the
Meeting to be held as scheduled. Alternatively, you may vote
your shares by telephone, the internet or by mail. Instructions
regarding all three methods of voting accompany your proxy
card.
TABLE OF CONTENTS
PIMCO
MUNICIPAL ADVANTAGE FUND INC.
c/o Allianz
Global Investors Fund Management LLC
1345 Avenue of the Americas
New York, New York 10105
IMPORTANT
NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS
FOR THE SHAREHOLDER MEETING TO BE HELD ON FEBRUARY 26,
2009
The 2009 Proxy Statement and the Annual Report to Shareholders
for the fiscal year ended October 31, 2008 are also
available at www.allianzinvestors.com.
FOR THE ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON FEBRUARY 26, 2009
INTRODUCTION
This Proxy Statement is furnished in connection with the
solicitation by the Board of Directors (the Board)
of PIMCO Municipal Advantage Fund Inc. (MAF or
the Fund) of proxies to be voted at the Annual
Meeting of Stockholders of the Fund and any adjournment or
postponement thereof (the Meeting). The Meeting will
be held at the offices of Allianz Global Investors
Fund Management LLC (AGIFM or the
Manager), at 1345 Avenue of the Americas, between
West 54th and West 55th Streets, 49th Floor, New York, New
York 10105, on Thursday, February 26, 2009 at
9:30 A.M., Eastern Time.
The Notice of Annual Meeting of Stockholders (the
Notice), this Proxy Statement and the enclosed proxy
cards are first being sent to Stockholders on or about
February 4, 2009.
The Board of the Fund has fixed the close of business on
December 29, 2008 as the record date (the Record
Date) for the determination of Stockholders of the Fund
entitled to notice of, and to vote at, the Meeting, and any
adjournment or postponement thereof. Stockholders of the Fund on
the Record Date will be entitled to one vote per share on each
matter to which they are entitled to vote and that is to be
voted on by Stockholders of the Fund, and a fractional vote with
respect to fractional shares, with no cumulative voting rights
in the election of Directors, with respect to each matter on
which they are entitled to vote. The following table sets forth
the number of shares of common stock (Common Shares)
and shares of preferred stock (Preferred Shares and,
together with the Common Shares, the Shares) issued
and outstanding of the Fund at the close of business on the
Record Date:
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Outstanding
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Outstanding Common Shares
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Preferred Shares
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7,258,006
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1,100
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The classes of Shares listed in the table above are the only
classes of Shares currently authorized by the Fund.
At the Meeting, Preferred Stockholders will have equal voting
rights (
i.e.
, one vote per Share) with the Funds
Common Stockholders on both Proposals. As shown in the below
table, the Preferred Stockholders will vote together with Common
Stockholders as a single class on both the re-election of R.
Peter Sullivan III and the election of Diana L. Taylor as
Directors, as described under Proposal I in this
Proxy Statement and on the proposed Liquidation, as described
under Proposal II in this proxy statement. As described in
this Proxy Statement, the Board has determined that the
liquidation and dissolution of the Fund is in the best interests
of the Fund and its Stockholders.
Summary
of Proposals
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Common
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Preferred
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Proposal
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Stockholders
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Stockholders
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Proposal I. Election of Directors
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Independent Directors/ Nominees
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Re-election of R. Peter Sullivan III
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Election of Diana L. Taylor
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Proposal II. Liquidation and Dissolution of the Fund
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*
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Independent Directors or Independent
Nominees are those Directors or nominees who are not
interested persons, as defined in the Investment
Company Act of 1940, as amended (the 1940 Act), of
the Fund.
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You may vote by mailing the enclosed proxy card. Alternatively,
you may vote your shares by telephone, the internet or by mail.
Instructions regarding all three methods of voting accompany
your proxy card. Shares represented by duly executed and timely
delivered proxies will be voted as instructed on the proxy. If
your proxy card is properly executed and no choice is indicated
for the Proposals listed in the attached Notice, your proxy will
be voted in favor of the election of all nominees named in
Proposal I and in favor of the liquidation and dissolution
of the Fund described in Proposal II. At any time before it
has been voted, your proxy may be revoked in one of the
following ways: (i) by delivering a signed, written letter
of revocation to the Secretary of the appropriate Fund at 1345
Avenue of the Americas, New York, New York 10105, (ii) by
properly executing and delivering a later-dated proxy, or
(iii) by attending the Meeting, requesting return of any
previously delivered proxy and voting in person. If any
proposals other than the Proposals set forth herein properly
come before the Meeting, Shares represented by the proxies will
be voted on all such proposals in the discretion of the person,
or persons, voting the proxies.
The principal executive offices of the Fund are located at 1345
Avenue of the Americas, New York, New York 10105. AGIFM serves
as the investment manager of the Fund and has retained its
affiliate, Pacific Investment Management Company LLC
(PIMCO or the
Sub-Adviser),
to serve as the Funds
sub-adviser.
Additional information regarding the Manager and PIMCO may be
found under Additional Information Investment
Manager and
Sub-Adviser
below.
The solicitation will be primarily by mail and the cost of
soliciting proxies will be borne by the Fund. Certain officers
of the Fund and certain officers and employees of the Manager or
its affiliates (none of whom will receive additional
compensation therefor) may solicit proxies by telephone, mail,
e-mail
and
personal interviews. The Board has approved hiring Broadridge
Financial Solutions, Inc. to aid in the solicitation of
instructions for registered and nominee accounts. The
anticipated expenses of processing, mailing and solicitation of
proxies are expected to be approximately $8,500. Any out-of
pocket expenses incurred in connection with the solicitation
will be borne by the Fund.
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PROPOSAL I:
ELECTION OF DIRECTORS
In accordance with the Funds Articles and Restatement (the
Charter), the Directors have been divided into the
following three classes (each a Class):
Class I, the term of which will expire at the Funds
2010 annual meeting of stockholders; Class II, the term of
which will expire at the Funds 2011 annual meeting of
stockholders; and Class III, the term of which will expire
at the Meeting. At each annual meeting of stockholders,
successors to the Class of Directors whose term expires at that
annual meeting shall be elected for a three-year term.
Accordingly, at the upcoming Meeting, Stockholders will vote to
elect Class III Directors, whose terms expire at the
Meeting, for an approximate three-year term expiring at the 2012
annual meeting. Currently, R. Peter Sullivan is the
Class III Director on the Funds Board.
In May 2008, the Funds Board approved an increase in the
size of the Board from seven to eight members, and Diana L.
Taylor was appointed to fill a Class II vacancy created by
such action, such appointment effective June 2008. In September
2008, an additional vacancy arose resulting from the death of
John J. Dalessandro II, who formally served as a Class III
Director. Accordingly, Stockholders will be asked to approve the
election of Ms. Taylor as a Class II Director at the
upcoming Meeting.
The Nominating Committee has recommended to the Funds
Board that Mr. Sullivan be nominated for re-election as a
Class III Director and Ms. Taylor be nominated for
election as a Class II Director at the Meeting, in each
case, to be voted on by the Common Stockholders and Preferred
Stockholders, voting together as a single class. Consistent with
the Funds Charter, if elected, the nominees shall hold
office for terms coinciding with the Classes of Directors to
which they have been designated. Therefore, if elected at the
Meeting, Mr. Sullivan will serve a term consistent with the
Class III Directors, which will expire at the Funds
2012 annual meeting. If elected at the Meeting, Ms. Taylor
will serve a term consistent with the Class II Directors,
which will expire at the Funds 2011 annual meeting.
At any annual meeting of Stockholders, any Director elected to
fill a vacancy that has arisen since the preceding annual
meeting of stockholders (whether or not such vacancy has been
filled by election of a new Director by the Board) shall hold
office for a term that coincides with the remaining term of the
Class of Directors to which such office was previously assigned,
if such vacancy arose other than by an increase in the number of
Directors, and until his or her successor shall be elected and
shall qualify. In the event such vacancy arose due to an
increase in the number of Directors, any Director so elected to
fill such vacancy at an annual meeting shall hold office for a
term which coincides with that of the Class of Director to which
such office has been apportioned and until his or her successor
shall be elected and shall qualify.
The following table summarizes the nominees who will stand for
election at the Meeting, the respective Classes of Directors to
which they have been designated and the expiration of their
respective terms if elected:
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Director/Nominee
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Class
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Expiration of Term if Elected*
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R. Peter Sullivan III
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Class III
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2012 Annual Meeting
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Diana L. Taylor
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Class II
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2011 Annual Meeting
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*
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A Director elected at an annual meeting shall hold office until
the annual meeting for the year in which his or her term expires
and until his or her successor shall be elected and shall
qualify, subject, however, to prior death, resignation,
retirement, disqualification or removal from office.
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Under this classified Board structure, generally only those
Directors in a single Class may be replaced in any one year, and
it would require a minimum of two years to change a majority of
the Board under normal circumstances. This structure, which may
be regarded as an anti-takeover provision, may make
it more difficult for the Funds Stockholders to change the
majority of Directors of the Fund and, thus, promotes the
continuity of management.
3
Unless authority is withheld, it is the intention of the persons
named in the enclosed proxy for the Fund to vote each proxy for
the persons listed above. Each of the nominees has indicated he
or she will serve if elected, but if he or she should be unable
to serve, the proxy holders may vote in favor of such substitute
nominee as the Board may designate (or, alternatively, the Board
may determine to leave a vacancy).
Information
Regarding Directors and Nominees.
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Number of
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Portfolios in
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Fund
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Other
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Complex
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Directorships
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Position(s)
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Term of Office
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Overseen by
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Held by
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Name, Address*
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Held with
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and Length of
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Principal Occupation(s)
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Director/
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Director/
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and Date of Birth
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the Fund
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Time Served
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During the Past 5 Years
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Nominee
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Nominee
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Independent Directors/Nominees
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Paul Belica
09/27/1921
Class II
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Director
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Since 2003
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Retired. Formerly Director, Student Loan Finance Corp.,
Education Loans, Inc., Goal Funding, Inc., Goal Funding II, Inc.
and Surety Loan Fund, Inc. Formerly, Manager of Stratigos Fund
LLC, Whistler Fund LLC, Xanthus Fund LLC & Wynstone Fund
LLC.
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47
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None
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Robert E. Connor
09/17/1934
Class I
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Director
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Since 2000
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Retired. Formerly, Senior Vice President, Corporate Office,
Smith Barney Inc.
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47
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None
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Hans W. Kertess
07/12/1939
Class I
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Director,
Chairman of
the Board
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Since February 2006,
Chairman since
December 2006
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President, H. Kertess & Co., a financial advisory company.
Formerly, Managing Director, Royal Bank of Canada Capital
Markets.
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47
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None
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William B. Ogden, IV
01/11/1945
Class I
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Director
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Since
September 2006
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Asset Management Industry Consultant. Formerly, Managing
Director, Investment Banking Division of Citigroup Global
Markets Inc.
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47
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None
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R. Peter Sullivan III
09/04/1941
Class III
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Nominee,
Director
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Since
February 2006
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Retired. Formerly, Managing Partner, Bear Wagner Specialists
LLC, specialist firm on the New York Stock Exchange.
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47
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None
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4
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Number of
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Portfolios in
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Fund
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Other
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Complex
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Directorships
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Position(s)
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Term of Office
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Overseen by
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Held by
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Name, Address*
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|
Held with
|
|
and Length of
|
|
Principal Occupation(s)
|
|
Director/
|
|
|
Director/
|
and Date of Birth
|
|
the Fund
|
|
Time Served
|
|
During the Past 5 Years
|
|
Nominee
|
|
|
Nominee
|
|
Diana L. Taylor
02/16/1955
Class II
|
|
Nominee,
Director
|
|
Since June 2008
|
|
Managing Director, Wolfensohn & Co, 2007-present. Formerly,
Superintendent of Banks, State of New York, 2003-2007.
|
|
|
43
|
|
|
Brookfield
Properties
Corporation
and Sothebys
|
Interested Director
|
John C. Maney**
08/03/1959
Class II
|
|
Director
|
|
Since December
2006
|
|
Management Board of Allianz Global Investors Fund Management
LLC; Management Board and Managing Director of Allianz Global
Investors of America L.P. since January 2005 and also Chief
Operating Officer of Allianz Global Investors of America L.P.
since November 2006. Formerly, Executive Vice President and
Chief Financial Officer of Apria Healthcare Group, Inc.
(1998-2001).
|
|
|
68
|
|
|
None
|
|
|
|
*
|
|
Unless otherwise indicated, the business address of the persons
listed above is
c/o Allianz
Global Investors Fund Management LLC, 1345 Avenue of the
Americas, New York, New York 10105.
|
|
|
|
**
|
|
Mr. Maney is an interested person of the Fund
due to his affiliation with Allianz Global Investors of America
L.P. In addition to Mr. Maneys positions set forth in
the table above, he holds the following positions with
affiliated persons: Management Board, Managing Director and
Chief Operating Officer of Allianz Global Investors of America
L.P., Allianz Global Investors of America LLC and Allianz-Pac
Life Partners LLC; Member Board of Directors and
Chief Operating Officer of Allianz Global Investors of America
Holdings Inc. and Oppenheimer Group, Inc.; Managing Director and
Chief Operating Officer of Allianz Global Investors NY Holdings
LLC; Management Board and Managing Director of Allianz Global
Investors U.S. Holding LLC; Managing Director and Chief
Financial Officer of Allianz Hedge Fund Partners Holding L.P.;
Managing Director and Chief Operating Officer of Allianz Global
Investors U.S. Retail LLC; Member Board of Directors
and Managing Director of Allianz Global Investors Advertising
Agency Inc.; Compensation Committee of NFJ Investment Group LLC;
Management Board of Allianz Global Investors
Fund Management LLC, Allianz Global Investors Management
Partners LLC, Nicholas-Applegate Holdings LLC and OpCap Advisors
LLC; Member Board of Directors of PIMCO Global
Advisors (Resources) Limited; and Executive Vice President of
PIMCO Japan Ltd.
|
5
The following table states the dollar range of equity securities
beneficially owned as of December 29, 2008 by each Director
and nominee of the Fund and, on an aggregate basis, of any
registered investment companies overseen by the Director or
nominee in the family of investment companies,
including the Fund.
|
|
|
|
|
|
|
|
|
|
|
|
Aggregate Dollar Range of Equity Securities in all
|
|
|
|
|
|
Registered Investment Companies Overseen by
|
|
|
Dollar Range of Equity
|
|
|
Director/Nominee in the Family of Investment
|
Name of Director/Nominee
|
|
Securities in the Fund*
|
|
|
Companies*
|
|
Independent Directors/Nominees
|
|
|
|
|
|
|
Paul Belica
|
|
|
None.
|
|
|
None.
|
Robert E. Connor
|
|
|
None.
|
|
|
None.
|
Hans W. Kertess
|
|
|
None.
|
|
|
None.
|
William B. Ogden, IV
|
|
|
None.
|
|
|
None.
|
R. Peter Sullivan III
|
|
|
None.
|
|
|
$10,001 - $50,000
|
Diana L. Taylor
|
|
|
None.
|
|
|
None.
|
Interested Director
|
|
|
|
|
|
|
John C. Maney
|
|
|
None.
|
|
|
Over $100,000
|
|
|
|
*
|
|
Securities are valued as of December 29, 2008.
|
As of December 29, 2008, the Directors and nominees and the
officers of the Fund as a group and individually beneficially
owned less than one percent (1%) of the Funds outstanding
Shares.
To the knowledge of the Fund, as of December 29, 2008,
Directors and nominees who are Independent Directors or
Independent Nominees and their immediate family members did not
own securities of an investment adviser or principal underwriter
of the 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 the Fund.
According to Schedule 13D filings made with the Securities
and Exchange Commission, the following investor owns 5% or more
of the Funds outstanding Common Shares as of
January 23, 2009:
Karpus
Management, Inc. d/b/a Karpus Investment
Management 15.59%
Compensation
Each of the Independent Trustees also serves as a trustee of
PIMCO Municipal Income Fund, PIMCO California Municipal Income
Fund, PIMCO New York Municipal Income Fund, PIMCO Municipal
Income Fund II, PIMCO California Municipal Income
Fund II, PIMCO New York Municipal Income Fund II,
PIMCO Municipal Income Fund III, PIMCO California Municipal
Income Fund III, PIMCO New York Municipal Income
Fund III, Nicholas-Applegate Convertible & Income
Fund, Nicholas-Applegate Convertible & Income
Fund II, PIMCO Corporate Opportunity Fund, PIMCO High
Income Fund, PIMCO Corporate Income Fund, PIMCO Floating Rate
Income Fund, PIMCO Floating Rate Strategy Fund, NFJ Dividend,
Interest & Premium Strategy Fund, Nicholas Applegate
International and Premium Strategy Fund, Nicholas-Applegate
Equity & Convertible Income Fund, Nicholas-Applegate
Global Equity & Convertible Income Fund, PIMCO Global
StocksPLUS & Income Fund, PIMCO Income Opportunity
Fund, PCM Fund, Inc. and PIMCO Strategic Global Government Fund,
Inc., each a closed-end fund for which the Manager serves as
investment manager and affiliates of the Manager serve as
sub-adviser (together, the Allianz Closed-End Funds)
and certain other open-end investment companies for which the
Manager serves as investment manager and administrator and
affiliates of the Manager serve as investment sub-advisers
(together with the Allianz Closed-End Funds, the
6
Allianz Managed Funds). As indicated below, certain
of the officers of the Fund are affiliated with the Manager.
Each of the Allianz Managed Funds are expected to hold joint
meetings of their Boards of Trustees whenever possible. Each
Trustee, other than any Trustee who is a director, officer,
partner or employee of the Manager, PIMCO or any entity
controlling, controlled by or under common control with the
Manager or PIMCO receives annual compensation of $250,000, which
is payable quarterly. The Independent Chairman of the Boards
receives an additional $75,000 per year, payable quarterly. An
Audit Oversight Committee Chairman annually receives an
additional $50,000 annually, payable quarterly. Trustees will
also be reimbursed for meeting-related expenses.
Each Trustees compensation and other costs of joint
meetings will be allocated pro rata among the Allianz Managed
Funds for which such Trustee serves as Trustee based on the
complexity of issues relating to each such Fund and relative
time spent by the Trustees in addressing them, and secondarily,
on each such Funds relative net assets (including assets
attributable to any outstanding preferred shares issued by an
Allianz Closed-End Fund).
Trustees do not currently receive any pension or retirement
benefits from the Fund or the Fund Complex.
The following table provides information concerning the
compensation paid to the Directors and nominees for the fiscal
year ended October 31, 2008. For the calendar year ended
December 31, 2008, the Directors received the compensation
set forth in the table below for serving as trustees/directors
of the Fund and other funds in the same
Fund Complex as the Fund. Each officer and each
Director who is a director, officer, partner, member or employee
of the Manager or the Sub-Adviser, or of any entity controlling,
controlled by or under common control with the Manager or the
Sub-Adviser, including any Interested Director, serves without
any compensation from the Fund.
Compensation
Table
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Compensation from
|
|
|
|
|
|
|
the Fund and Fund
|
|
|
|
Aggregate
|
|
|
Complex Paid to
|
|
|
|
Compensation from the
|
|
|
Directors for
|
|
|
|
Fund for the Fiscal Year
|
|
|
the Calendar Year
|
|
|
|
Ended October 31,
|
|
|
Ended December 31,
|
|
Name of Director/Nominees
|
|
2008
|
|
|
2008*
|
|
|
Independent Directors/Nominees
|
|
|
|
|
|
|
|
|
Paul Belica
|
|
$
|
3,195
|
|
|
$
|
267,132.00
|
|
Robert E. Connor
|
|
$
|
2,675
|
|
|
$
|
252,637.00
|
|
John J. Dalessandro II
|
|
$
|
2,675
|
|
|
$
|
182,427.00
|
|
Hans W. Kertess
|
|
$
|
5,195
|
|
|
$
|
318,927.00
|
|
William B. Ogden, IV
|
|
$
|
2,695
|
|
|
$
|
246,666.00
|
|
R. Peter Sullivan III
|
|
$
|
2,695
|
|
|
$
|
251,049.00
|
|
Diana L. Taylor
|
|
$
|
840
|
**
|
|
$
|
185,871.00
|
|
Interested Director
|
|
|
|
|
|
|
|
|
John C. Maney
|
|
$
|
0
|
|
|
$
|
0
|
|
|
|
|
*
|
|
In addition to the Fund and other AGIFM Closed-End Funds, during
the Funds most recently completed fiscal year, all of the
Directors served as Directors of two open-end investment
companies (each consisting of separate investment portfolios)
advised by the Manager, except for Diana L. Taylor who served as
|
7
|
|
|
|
|
a Director to one such open-end company. The other AGIFM
closed-end and these open-end investment companies are
considered to be in the same Fund Complex as
the Fund.
|
|
|
|
**
|
|
Ms. Taylors appointment as a Director of the Fund was
not effective until June 10, 2008.
|
The Fund has no employees. The Funds officers and
Mr. Maney are compensated by the Manager, the Sub-Adviser
or one of their affiliates.
Board
Committees and Meetings.
Audit Oversight Committee.
The Board of the
Fund has established an Audit Oversight Committee in accordance
with Section 3(a)(58)(A) of the Securities Exchange Act of
1934, as amended (the Exchange Act). The Funds
Audit Oversight Committee currently consists of
Messrs. Belica, Connor, Kertess, Ogden and Sullivan and
Ms. Taylor, each of whom is an Independent Director.
Mr. Belica is the Chairman of the Funds Audit
Oversight Committee. The Funds Audit Oversight Committee
provides oversight with respect to the internal and external
accounting and auditing procedures of the Fund and, among other
things, determines the selection of the independent registered
public accounting firm for the Fund and considers the scope of
the audit, approves all audit and permitted non-audit services
proposed to be performed by those auditors on behalf of the
Fund, and approves services to be performed by the auditors for
certain affiliates, including the Manager, the Sub-Adviser and
entities in a control relationship with the Manager or the
Sub-Adviser that provide services to the Fund where the
engagement relates directly to the operations and financial
reporting of the Fund. The Committee considers the possible
effect of those services on the independence of the Funds
independent registered public accounting firm.
Each member of the Funds Audit Oversight Committee is
independent, as independence for audit committee
members is defined in the currently applicable listing standards
of the New York Stock Exchange, on which the Common Shares of
the Fund are listed.
The Board of the Fund has adopted a written charter for its
Audit Oversight Committee. A copy of the written charter for the
Fund, as amended through June 10, 2008 is attached to this
Proxy Statement as
Exhibit A
. A report of the Audit
Oversight Committee of the Fund, dated December 22, 2008,
is attached to this Proxy Statement as
Exhibit B
.
Nominating Committee.
The Board of the Fund
has a Nominating Committee composed solely of Independent
Directors, currently consisting of Messrs. Belica, Connor,
Kertess, Ogden, and Sullivan and Ms. Taylor. The Nominating
Committee is responsible for reviewing and recommending
qualified candidates to the Board in the event that a position
is vacated or created or when Directors are to be nominated for
election by Stockholders. The Nominating Committee of the Fund
has adopted a charter, which is posted on the following website:
http://www.allianzinvestors.com/closedendfunds/literature
.
Each member of the Nominating Committee is
independent, as independence for nominating
committee members is defined in the currently applicable listing
standards of the New York Stock Exchange, on which the Common
Shares of the Fund are listed.
Qualifications, Evaluation and Identification of Director
Nominees.
The Nominating Committee of the Fund
requires that Director candidates have a college degree or
equivalent business experience. When evaluating candidates, the
Funds Nominating Committee may take into account a wide
variety of factors including, but not limited to:
(i) availability and commitment of a candidate to attend
meetings and perform his or her responsibilities on the Board,
(ii) relevant industry and related experience,
(iii) educational background, (iv) financial
expertise, (v) an assessment of the candidates
ability, judgment and expertise and (vi) overall Board
composition. The process of identifying nominees involves the
consideration of candidates recommended by one or more of the
following sources: (i) the Funds current Directors,
(ii) the Funds
8
officers, (iii) the Funds Stockholders and
(iv) any other source the Committee deems to be
appropriate. The Nominating Committee of the Fund may, but is
not required to, retain a third party search firm at the
Funds expense to identify potential candidates.
Consideration of Candidates Recommended by
Stockholders.
The Nominating Committee of the
Fund will review and consider nominees recommended by
Stockholders to serve as Directors, provided that the
recommending Stockholder follows the Procedures for
Stockholders to Submit Nominee Candidates for the Allianz Global
Investors Fund Management Sponsored Closed-End Funds,
which are set forth as Appendix B to the Funds
Nominating Committee Charter. Among other requirements, these
procedures provide that the recommending Stockholder must submit
any recommendation in writing to the Fund, to the attention of
the Funds Secretary, at the address of the principal
executive offices of the Fund and that such submission must be
received at such offices not less than 45 days nor more
than 75 days prior to the date of the Board or stockholder
meeting at which the nominee would be elected. Any
recommendation must include certain biographical and other
information regarding the candidate and the recommending
Stockholder, and must include a written and signed consent of
the candidate to be named as a nominee and to serve as a
Director if elected. The foregoing description of the
requirements is only a summary. Please refer to Appendix B
to the Nominating Committee Charter, which is available at
http://www.allianzinvestors.com/closedendfunds/literature
,
for details.
The Nominating Committee has full discretion to reject nominees
recommended by Stockholders, and there is no assurance that any
such person properly recommended and considered by the Committee
will be nominated for election to the Board of the Fund.
Valuation Committee.
The Board has a Valuation
Committee currently consisting of Messrs. Belica, Connor,
Kertess, Ogden, Sullivan and Ms. Taylor. The Board has
delegated to the Committee the responsibility to determine or
cause to be determined the fair value of the Funds
portfolio securities and other assets when market quotations are
not readily available. The Valuation Committee reviews and
approves procedures for the fair valuation of the Funds
portfolio securities and periodically reviews information from
the Manager and the Sub-Adviser regarding fair value and
liquidity determinations made pursuant to Board-approved
procedures, and makes related recommendations to the full Board
and assists the full Board in resolving particular fair
valuation and other valuation matters.
Compensation Committee.
The Board of the Fund
has a Compensation Committee currently consisting of
Messrs. Belica, Connor, Kertess, Ogden and Sullivan and
Ms. Taylor. The Compensation Committee meets as the Board
deems necessary to review and make recommendations regarding
compensation payable to the Directors of the Fund who are not
directors, officers, partners or employees of the Manager, the
Sub-Adviser or any entity controlling, controlled by or under
common control with the Manager or the Sub-Adviser.
Meetings.
With respect to the Fund, during the
fiscal year ended October 31, 2008, the Board of Directors
held four regular meetings and seven special meetings. The Audit
Oversight Committee and the Nominating Committees each met in
separate session twice, and the Valuation Committee and the
Compensation Committee did not meet in separate sessions. Each
of the current Directors attended at least 75% of the regular
meetings of the Board and meetings of the committees on which
such Director served that were held during the fiscal year ended
October 31, 2008, except Ms. Taylor who was not
appointed to the Board until June 10, 2008.
Stockholder Communications with the Board of
Directors.
The Board of Directors of the Fund has
adopted procedures by which Fund Stockholders may send
communications to the Board. Stockholders may mail written
communications to the Board to the attention of the Board of
Directors, PIMCO Municipal Advantage Fund Inc.,
c/o Thomas
J. Fuccillo, Chief Legal Officer (CLO), Allianz
Global Investors Fund Management LLC, 1345 Avenue of the
Americas, New York, New York 10105. Stockholder communications
must (i) be in writing and be signed by the Stockholder and
(ii) identify the class and number of
9
Shares held by the Stockholder. The CLO or his designee is
responsible for reviewing properly submitted stockholder
communications. The CLO shall either (i) provide a copy of
each properly submitted stockholder communication to the Board
at its next regularly scheduled Board meeting or (ii) if
the CLO determines that the communication requires more
immediate attention, forward the communication to the Directors
promptly after receipt. The CLO may, in good faith, determine
that a stockholder communication should not be provided to the
Board because it does not reasonably relate to the Fund or its
operations, management, activities, policies, service providers,
Board, officers, stockholders or other matters relating to an
investment in the Fund or is otherwise routine or ministerial in
nature. These procedures do not apply to (i) any
communication from an officer or Director of the Fund,
(ii) any communication from an employee or agent of the
Fund, unless such communication is made solely in such
employees or agents capacity as a stockholder, or
(iii) any stockholder proposal submitted pursuant to
Rule 14a-8
under the Exchange Act or any communication made in connection
with such a proposal. The Funds Directors are not required
to attend the Funds annual stockholder meetings or to
otherwise make themselves available to stockholders for
communications, other than by the aforementioned procedures.
Section 16(a) Beneficial Ownership Reporting
Compliance.
The Funds Directors and certain
officers, investment advisers, certain affiliated persons of the
investment advisers and persons who own more than 10% of any
class of outstanding securities of the Fund (
i.e
., the
Funds Common Shares or Preferred Shares) are required to
file forms reporting their affiliation with the Fund and reports
of ownership and changes in ownership of the Funds
securities with the Securities and Exchange Commission (the
SEC) and the New York Stock Exchange (the
NYSE). These persons and entities are required by
SEC regulation to furnish the Fund with copies of all such forms
they file. Based solely on a review of these forms furnished to
the Fund, the Fund believes that each of the Directors and
relevant officers, investment advisers and relevant affiliated
persons of the investment advisers has complied with all
applicable filing requirements during the Funds fiscal
year ended October 31, 2008, except that due to
administrative oversight, late Form 3 filings were made for
certain employees who are affiliated persons of the Fund:
William C. Powers, Steven Ludwig, Scott Whisten, Richard J.
Cochran, Barbara R. Claussen and Hans W. Kertess in December
2008. In addition, Andrew Meyers (who is no longer a reporting
person), failed to file a Form 3. In December 2008 and
January 2009, 18 amended Form 3s were filed solely for the
purpose of attaching omitted Powers of Attorney for various
reporting persons.
Required Vote.
The re-election of
Mr. Sullivan and the election of Ms. Taylor to the
Board of Directors of the Fund will require the affirmative vote
of a plurality of the votes cast of the Common Stockholders and
Preferred Stockholders, voting as a single class, at the
Meeting, in person or by proxy.
THE
BOARD OF DIRECTORS OF THE FUND UNANIMOUSLY RECOMMENDS THAT
YOU VOTE FOR PROPOSAL I.
PROPOSAL II:
APPROVAL OF THE LIQUIDATION
AND DISSOLUTION OF THE FUND
At a special meeting of the Board of Directors of the Fund held
on December 22, 2008, the Directors approved a proposal to
liquidate and dissolve the Fund (such proposal, the
Liquidation) pursuant to a Plan of Liquidation and
Dissolution (the Plan), a form of which is attached
as
Exhibit C
. Under Maryland law and the Funds
Charter, the Liquidation requires the affirmative vote of a
majority of the votes entitled to be cast of the Common
Stockholders and Preferred Stockholders, voting together as a
single class. At your upcoming Meeting, you will be asked to
approve the Liquidation and Plan, which is described in more
detail in this Proxy Statement. The Directors unanimously
recommend that you vote FOR this Proposal II for the
reasons discussed below.
10
Background
The Fund commenced operations on April 30, 1993, and is
organized as a corporation under the laws of Maryland. The
Funds investment objective is to seek to provide current
income exempt from regular federal income tax while preserving
capital. As of November 30, 2008, the Fund had assets
totaling $122.9 million, with approximately
$67.9 million held in Common Shares and approximately
$55 million held in Preferred Shares. Over the past several
months and often prior thereto, Common Shares of the Fund have
traded at a discount to their net asset value (NAV).
Both in response to the persistent trading discount and as part
of its general oversight responsibilities, the Board of
Directors has continually discussed and reviewed with Fund
management various possible measures to address the discount and
enhance Stockholder value.
In 2007, two major Common Stockholders submitted for inclusion
in the Funds 2008 annual meeting proxy statement various
proposals designed to address the Common Shares trading at
a discount to NAV. Following discussions, management and these
stockholders reached an agreement pursuant to which management
recommended that the Board adopt a policy to address the trading
discount and the stockholders agreed to withdraw their proposals
in connection with the 2008 annual meeting.
Specifically, at the recommendation of management, in February
2008, the Board adopted a discount control policy intended to
reduce the discount to NAV at which the Funds Common
Shares trade (the Discount Control Policy). Under
the terms of the Discount Control Policy, at the end of each
calendar quarter, commencing with the quarter ended
September 30, 2008, if the Funds Common Shares are
determined to have traded at an average discount to NAV in
excess of 0% over the quarter, the Board, subject to its
fiduciary obligations, shall promptly take steps necessary to
enable Common Stockholders to realize NAV for their shares.
For the quarter ended September 30, 2008, the Funds
Common Shares traded at an average discount to NAV of
approximately -2.45%. In October 2008, the Board met to consider
possible actions under the Discount Control Policy. At such
time, the Board determined to defer action under the Discount
Control Policy in light of unprecedented and highly volatile
market conditions, and managements recommendation that
such market conditions created uncertainty as to whether it was
advisable at that time to pursue various actions that might
provide liquidity to Common Stockholders at NAV. The Board and
management then continued to monitor market conditions and the
Funds holdings and to seek viable options for implementing
the Discount Control Policy that would be in the best interests
of the Fund and its Stockholders.
At the Boards December quarterly board meeting, it was
noted that for the period from September 30, 2008 through
December 9, 2008, the Funds Common Shares traded at
an average discount to NAV of approximately -5.98%.
Board
Considerations in Approving the Proposed Liquidation
On December 22, 2008, the Board held a special meeting for
the purpose of reviewing the Funds trading discount and
discussing appropriate steps to be taken under the Discount
Control Policy. At the special meeting, Fund management reviewed
with the Board various options for the Fund and recommended that
the Board approve the Liquidation and the Plan, and submit the
proposal for approval by Stockholders.
In discussing various alternatives with the Board at the special
meeting, management noted that, for some time, it has evaluated
options for the Fund to implement the Discount Control Policy.
In particular, management discussed with the Board the
possibility of merging the Fund with another closed-end
investment company or with an open-end investment company. After
careful consideration, management determined not to recommend
these options, taking into account, among other factors, the
costs and other challenges raised by a possible merger, and
anticipated challenges in obtaining the required stockholder
approval for a merger. In
11
addition, management did not view conversion of the Fund to an
open-end fund as an advisable approach, particularly in view of
significant redemptions that would likely occur following
open-ending, which would likely reduce the Funds asset
size and increase its operating expenses significantly.
Management noted that other options for the Fund, such as
limited tender offers or open-market purchases, would not likely
fully achieve the purpose of the Discount Control Policy, which
is to allow Common Stockholders to realize NAV for their Shares.
Accordingly, management determined and recommended to the Board
of Directors that liquidation was the most viable option for
implementing the Discount Control Policy and allowing Common
Stockholders to realize NAV for their shares.
At the December 22, 2008 special meeting, the Board of
Directors also considered, among other things:
|
|
|
|
|
the current asset levels of the Fund;
|
|
|
|
the history of the Funds performance, both at net asset
value and at market prices;
|
|
|
|
|
|
the Funds current dividend to Common Stockholders of $0.06;
|
|
|
|
|
|
the Funds tax loss carryforwards and assumptions regarding
the Funds ability to use some or all of such carryforwards
or the loss of such a benefit under the various alternatives
considered;
|
|
|
|
the fact that two of the Funds common stockholders, which
together own approximately 24% of the Funds outstanding
Common Shares, have advocated for certain actions intended to
eliminate or reduce the discount at which the Funds Common
Shares are trading;
|
|
|
|
the form of the Plan and the terms and conditions of the
Liquidation (described below);
|
|
|
|
the costs of the Liquidation (largely those for legal, printing,
audit, and proxy solicitation expenses), as discussed under
Distribution Amounts; Expenses of Liquidation,
below, are estimated to be approximately in the range of $60,000
to $85,000, which will be borne by the Fund;
|
|
|
|
the anticipated transaction costs associated with liquidating
the Funds portfolio securities, as discussed under
Distribution Amounts; Expenses of Liquidation,
below, which will be borne by the Fund; and
|
|
|
|
managements view on an orderly liquidation of the
Funds portfolio under current market conditions and the
time that might be involved in accomplishing such a liquidation.
|
Following discussions with management, the Board of Directors,
including all of the Directors who are not interested
persons of the Fund (as that term is defined in the 1940
Act), with the advice and assistance of independent counsel,
determined that the proposed Liquidation is in the best interest
of the Fund and its Stockholders, approved the Liquidation and
the Plan, and directed that the Plan be submitted for the vote
of the Funds Stockholders.
If the Liquidation is approved by Stockholders, management,
under the oversight of the Directors and officers of the Fund,
will proceed to wind up the Funds affairs as soon as
reasonably practicable thereafter in a timeframe that allows for
an orderly liquidation of portfolio holdings under then-current
market conditions. The Fund cannot predict at this time how long
it will take to accomplish an orderly liquidation. See
Additional Considerations below. If the Liquidation
is not approved by Stockholders, the Directors will consider
whether another course of action would benefit the Fund and its
Stockholders.
Summary
of the Plan
The following is only a summary and is not complete.
Stockholders are urged to read the Plan, a copy of which is
attached as Exhibit C, in its entirety for more information.
12
Effective Date and Cessation of
Business.
Pending the requisite approval by the
Funds Stockholders, the Plan shall become effective at the
close of business on or about February 26, 2009 (the
Effective Date
) or in the event the Meeting
is postponed or adjourned, the Effective Date of the Plan shall
be the date that Proposal II meets the required vote for
approval. At the Effective Date, the Fund shall cease its
operations and thereafter shall not engage in any business
activities except for the purposes of liquidating the Fund.
Following the Effective Date (taking into account market
conditions and other relevant factors), the Directors and
officers of the Fund shall proceed to wind up the affairs of the
Fund; to pay or make provision for the payment of the
Funds debts and liabilities; to reduce the remaining
assets of the Fund to distributable form in cash, and to
distribute the proceeds to or for the account of the
Stockholders of the Fund, as described under Liquidating
Distributions below.
As noted above, in connection with the cessation of the
Funds business, the Fund will liquidate its portfolio
holdings. See Distribution Amounts; Expenses of
Liquidation below regarding the costs incurred by the Fund
in this regard. The Fund is unable to predict when the complete
liquidation of its portfolio holdings will be accomplished.
Fixing of Interests and Closing of Books.
For
purposes of determining the Stockholders of the Fund entitled to
receive payment of all Liquidating Distributions (as defined
below), the proportionate interests of Stockholders in the
assets of the Fund shall be fixed on the basis of their
respective shareholdings at the close of business on the
Effective Date, or on such later date as may be determined by
the Board (the
Determination Date
). On the
Determination Date, the books of the Fund shall be closed.
Thereafter, unless the books are reopened because the Plan
cannot be carried into effect under the laws of the State of
Maryland or otherwise, the Common Stockholders respective
interests in the Funds assets shall not be transferable by
the negotiation of share certificates and the Funds Common
Shares will cease to be traded on the NYSE.
Termination of the Fund.
The Fund shall be
terminated as soon as reasonably practicable after the Effective
Date and the completion of the implementation of the Plan, which
date of termination of the Fund shall be determined by the
President of the Fund or other authorized officer (the
Termination Date
).
Payment of Liabilities and Expenses.
Within a
reasonable period after the Effective Date, the Fund shall
determine, and there shall be paid or otherwise provided for,
all charges, taxes, expenses, liabilities and reserves, whether
due or accrued or anticipated, of the Fund (collectively,
Debts
).
Liquidating Distributions.
As soon as
reasonably practicable after the Determination Date and
following the payment or other provision for Debts of the Fund,
the remaining assets of the Fund shall be distributed to or for
the account of the Stockholders of the Fund, at any one or more
times, and shall proceed in the order of priority provided below
(each a Liquidating Distribution): First, to the
Preferred Stockholders, the amount of $50,000 per Preferred
Share, plus an amount equal to all accumulated but unpaid
dividends thereon (whether or not earned or declared) to but not
including the date of such Liquidating Distribution, in
same-day
funds; and second, after determination of any dividend to be
paid pursuant to the Plan, all remaining amounts to the Common
Stockholders, ratably according to the number of Shares of the
Fund held by such Common Stockholders on the Determination Date.
In the event the assets of the Fund available for distribution
upon liquidation to the Preferred Stockholders are insufficient
to make full payments to which such holders are entitled in
accordance with the Bylaws of the Fund, payment shall be made
pro rata among all such Preferred Stockholders. It is intended
that any and all amounts of a Liquidating Distribution to
Preferred Stockholders comprising a dividend shall be
characterized in a manner consistent with Revenue
Ruling 89-81,
1989-1
C.B.
226.
The Liquidating Distribution to the Common Stockholders will
include, if necessary, a dividend equal to the sum of
(i) the amount, if any, required to avoid the imposition of
tax under section 852 of the Internal Revenue Code of 1986,
as amended (the Code) on investment company taxable
income and net capital gain for each of the Funds
(a) most recently completed taxable year, and (b) the
subsequent taxable period ending
13
on the Liquidation Date and (ii) the additional amount, if
any, required to avoid the imposition of tax under
section 4982 of the Code on ordinary income and capital
gain net income. The Board of Directors of the Fund hereby
declares that the dividend so paid shall be deemed for all
purposes to have been conclusively declared on the date of this
Plan. It is intended that any and all amounts of a Liquidating
Distribution to Common Stockholders comprising such a dividend
shall be characterized in a manner consistent with Revenue
Ruling
89-81,
1989-1
C.B.
226.
Deregistration under the 1940 Act.
As soon as
practicable after the Termination Date, the Fund shall take
action to become deregistered as an investment company under the
1940 Act, and the officers of the Fund shall take such other
actions as may be deemed necessary or advisable to carry out the
provisions and purposes of the Plan.
Amendment of Plan.
A majority of the Board of
Directors shall have the power to authorize such variations from
or amendments of the provisions of the Plan as may be necessary
or appropriate to effect the complete liquidation and
dissolution of the Fund, and the distribution of assets to
Common Stockholders in accordance with the purposes to be
accomplished by the Plan.
U.S.
Federal Income Tax Consequences
The following is only a general summary of the United States
federal income tax consequences of the Plan. Stockholders should
consult with their own tax advisors for advice regarding the
application of current United States federal tax law to their
particular situation and with respect to potential state, local
or other tax consequences of the Plan.
The Liquidating Distributions received by a Stockholder will be
treated for U.S. federal income tax purposes as full
payment for the Stockholders shares. Thus, a Stockholder
who is subject to U.S. federal income tax will recognize a
gain or loss for tax purposes on the receipt of the Liquidating
Distribution. The Stockholders gain or loss will be a
capital gain or capital loss if such Shares are held as capital
assets.
The Fund is generally required to withhold and remit to the
U.S. Treasury a percentage of the taxable liquidation
proceeds paid to any Stockholder who fails to provide the Fund
with a correct taxpayer identification number, who has
underreported dividend or interest income, or who fails to
certify to the Fund that he, she or it is not subject to backup
withholding.
Impact of
the Plan on the Funds Status under the 1940 Act
If approved by Stockholders, on the Effective Date or
Determination Date, as applicable, the Fund will cease doing
business as a registered investment company and, as soon as
reasonably practicable, will apply for deregistration under the
1940 Act. It is expected that the SEC will issue an order
approving the deregistration of the Fund if the Fund is no
longer doing business as an investment company. Accordingly, the
Plan provides for the eventual cessation of the Funds
activities as an investment company and the Funds
deregistration under the 1940 Act, and a vote in favor of the
Plan will constitute a vote in favor of such a course of action.
Until the Funds withdrawal as an investment company
becomes effective, the Fund will continue to be subject to and
will comply with the 1940 Act.
Procedure
for Dissolution under Maryland Law
Pursuant to the Maryland General Corporation Law and the
Funds Articles of Restatement and Bylaws, if Stockholders
approve the Plan, Articles of Dissolution stating that the
dissolution has been authorized will in due course be executed,
acknowledged and filed with the State Department of Assessments
and Taxation of Maryland, and will become effective in
accordance with such law. Upon the effective date of such
Articles of
14
Dissolution, the Fund will be legally dissolved, but thereafter
the Fund will continue to exist for the purpose of paying,
satisfying, and discharging any existing debts or obligations,
collecting and distributing the Funds assets, and doing
all other acts required to liquidate and wind up the Funds
business and affairs, but not for the purpose of continuing the
business for which the Fund was organized. The Funds Board
of Directors shall be the trustees of its assets for purposes of
liquidation after the acceptance of the Articles of Dissolution,
unless and until a court appoints a receiver. The
Director-trustees will be vested in their capacity as trustees
with full title to all the assets of the Fund.
Distribution
Amounts; Expenses of Liquidation
The Funds total net assets on January 14, 2009 were
$125.1 million. At such date, the Fund had
7,259,106 Shares outstanding, consisting of 7,258,006
Common Shares and 1,100 Preferred Shares. Accordingly, on
January 14, 2009, the net asset value per Common Shares of
the Fund was $9.66. The amount to be distributed to Common
Stockholders will be reduced by the remaining expenses of the
Fund, including the expenses associated with this proxy
solicitation and those associated with the liquidation and
portfolio transaction costs, as well as costs incurred in
resolving any claims that may arise against the Fund. The Fund
will bear all expenses incurred by the Fund in carrying out the
Plan. These expenses are estimated to be approximately in the
range of $60,000 to $85,000. Out-of pocket costs related to
actual liquidation expenses and portfolio transaction costs may
vary from these estimates. These costs and expenses do not
include the potential market impact of liquidation of portfolio
securities (including the liquidation of potentially large
blocks of portfolio securities) under current and developing
market conditions. Any increase in liquidation expenses and
portfolio transaction costs will be funded from the cash assets
of the Fund and will reduce the amount available for
distribution to Stockholders.
Additional
Considerations
In addition to the other information contained in this Proxy
Statement, you should consider the following factors in
determining whether or not to vote in favor of the Liquidation.
The Fund is not able to Estimate Net Proceeds to be Received
by Common Stockholders.
The actual amount to be
received as a Liquidating Distribution(s) by Common Stockholders
is subject to significant uncertainties and not possible to
predict at this time. The amount available for distribution to
Common Stockholders will be based, in part, on the value of the
Funds assets at the time of liquidation and then-current
market conditions; the amount of the Funds actual costs,
expenses and liabilities to be paid in the future; the potential
market impact of liquidation of portfolio securities (including
the liquidation of potentially large blocks of portfolio
securities) under current and developing market conditions;
general business and economic conditions; and the time required
to liquidate the Funds assets, all of which can not be
predicted with any certainty at this time.
The Fund is Not Able to Predict at this Time the Length of
Time it Would Take to Complete the
Liquidation.
If Stockholders approve the Plan,
the Fund will be authorized to commence the sale and liquidation
of its assets and the Fund will cease investment activity other
than managing the sale of securities and the Funds cash
levels. The Fund is unable to predict when it will complete the
sale of its assets or when it will make Liquidating
Distribution(s) to Stockholders under the Plan. In effecting the
Liquidation, the Funds Sub-Adviser expects to invest the
cash proceeds from the sale of portfolio securities in
tax-exempt money market funds, short-term tax-exempt instruments
and/or
short-term taxable instruments. However, the Fund will not be
managed during the liquidation period in a manner designed to
produce investment returns analogous to that which it attempted
to achieve during its investment operations. Further, the market
value of the Funds portfolio securities may decline during
the liquidation period resulting in a reduction in the amounts
15
available for ultimate liquidation distribution, and the length
of the liquidation period can not be predicted at this time as
described above.
The Liquidity and Market Price of Fund Common Shares
Could Decrease.
As the Fund sells its assets and
distributes Liquidating Distribution(s) to Stockholders, the
Funds market capitalization and float may
diminish. Market interest in Fund Shares may also diminish.
This could reduce the market demand for and liquidity of
Fund Common Shares, which may adversely affect the
Fund Shares market price. The Fund currently intends
to maintain its listing on the NYSE until such time as the
Common Shares are no longer eligible for listing and trading.
This would further decrease the market demand for and liquidity
and price of the Funds Common Shares.
Appraisal
Rights
Stockholders will not be entitled to appraisal rights under
Maryland law in connection with the Plan.
Required Vote.
In accordance with the
Funds Charter and applicable law, approval of
Proposal II will require the affirmative vote of at least a
majority of the votes entitled to be cast by holders of Common
Shares and Preferred Shares of the Fund, voting together as a
single class.
Your Board of Directors Unanimously Recommends that You Vote
For the Proposed Plan of Liquidation and
Dissolution
. Unless a contrary specification is made, the
accompanying proxy will be voted FOR approval of the Plan.
ADDITIONAL
INFORMATION
Executive and Other Officers of the Fund.
The
table below provides certain information concerning the
executive officers of the Fund and certain other officers who
perform similar duties. Officers hold office at the pleasure of
the Board and until their successors are chosen and qualified,
or in each case until he or she sooner dies, resigns, is removed
with or without cause or becomes disqualified. Officers and
employees of the Fund who are principals, officers, members or
employees of the Manager or the Sub-Adviser are not compensated
by the Fund.
|
|
|
|
|
|
|
Name, Address*
|
|
Position(s) Held
|
|
Term of Office and Length
|
|
Principal Occupation(s) During
|
and Date of Birth
|
|
with Fund
|
|
of Time Served
|
|
the Past 5 Years
|
|
Brian S. Shlissel
11/14/1964
|
|
President & Chief Executive Officer
|
|
Since September 2002
|
|
Executive Vice President, Director of Fund Administration,
Allianz Global Investors Fund Management LLC; Director of 6
funds in the Fund Complex; President and Chief Executive Officer
of 35 funds in the Fund Complex; Treasurer, Principal Financial
and Accounting Officer of 44 funds in the Fund Complex and The
Korea Fund, Inc.
|
16
|
|
|
|
|
|
|
Name, Address*
|
|
Position(s) Held
|
|
Term of Office and Length
|
|
Principal Occupation(s) During
|
and Date of Birth
|
|
with Fund
|
|
of Time Served
|
|
the Past 5 Years
|
|
Lawrence G. Altadonna
03/10/1966
|
|
Treasurer, Principal Financial and Accounting Officer
|
|
Since September 2002
|
|
Senior Vice President, Allianz Global Investors Fund Management
LLC; Treasurer, Principal Financial and Accounting Officer of
35 funds in the Fund Complex; Assistant Treasurer of 44
funds in the Fund Complex and The Korea Fund, Inc.
|
Thomas J. Fuccillo
03/22/1968
|
|
Vice President, Secretary and Chief Legal Officer
|
|
Since December 2004
|
|
Executive Vice President, Senior Counsel, Allianz Global
Investors of America L.P.; Executive Vice President and Chief
Legal Officer, Allianz Global Investors Fund Management LLC and
Allianz Global Investors Solutions LLC; Vice President,
Secretary and Chief Legal Officer of 79 funds in the Fund
Complex; Secretary and Chief Legal Officer of The Korea Fund,
Inc.; Formerly, Vice President and Associate General Counsel,
Neuberger Berman, LLC (1991-2004).
|
Youse Guia
680 Newport Center Drive Suite 250
Newport Beach,
CA 92660
09/03/1972
|
|
Chief Compliance Officer
|
|
Since October 2004
|
|
Senior Vice President, Group Compliance Manager, Allianz Global
Investors of America L.P.; Chief Compliance Officer of 79 funds
in the Fund Complex and The Korea Fund, Inc.; Formerly, Vice
President, Group Compliance Manager, Allianz Global Investors of
America L.P. (2002-2004).
|
Scott Whisten
03/13/1971
|
|
Assistant Treasurer
|
|
Since January 2007
|
|
Vice President, Allianz Global Investors Fund Management LLC;
Assistant Treasurer of 79 funds in the Fund Complex; formerly,
Accounting Manager, Prudential Investments
(2000-2005).
|
Richard J. Cochran
01/23/1961
|
|
Assistant Treasurer
|
|
Since May 2008
|
|
Vice President, Allianz Global Investors Fund Management LLC;
Assistant Treasurer of 79 funds in the Fund Complex; formerly,
Tax manager, Teachers Insurance Annuity Association/College
Retirement Equity Fund (TIAA-CREF) (2002-2008).
|
17
|
|
|
|
|
|
|
Name, Address*
|
|
Position(s) Held
|
|
Term of Office and Length
|
|
Principal Occupation(s) During
|
and Date of Birth
|
|
with Fund
|
|
of Time Served
|
|
the Past 5 Years
|
|
William V. Healey
07/28/1953
|
|
Assistant Secretary
|
|
Since December 2006
|
|
Executive Vice President, Chief Legal Officer-U.S.
|
|
|
|
|
|
|
Retail, Allianz Global Investors of America L.P.; Executive Vice
President, Chief Legal Officer and Secretary, Allianz Global
Investors Advertising Agency Inc., Allianz Global Investors
Managed Accounts LLC and Allianz Global Investors Distributors
LLC; Assistant Secretary of 79 funds in the Fund Complex.
Formerly, Vice President and Associate General Counsel,
Prudential Insurance Company of America; Executive Vice
President and Chief Legal Officer, The Prudential Investments
(1998-2005).
|
Richard H. Kirk
04/06/1961
|
|
Assistant Secretary
|
|
Since December 2006
|
|
Senior Vice President, Allianz Global Investors of America L.P.
(since 2004). Senior Vice President, Associate General Counsel,
Allianz Global Investors Distributors LLC. Assistant Secretary
of 79 funds in the Fund Complex; formerly, Vice President,
Counsel, The Prudential Insurance Company of America/American
Skandia (2002-2004).
|
Kathleen A. Chapman
11/11/1954
|
|
Assistant Secretary
|
|
Since December 2006
|
|
Assistant Secretary of 79 funds in the Fund Complex;
Manager IIG Advisory Law, Morgan Stanley
(2004-2005); Paralegal, The Prudential Insurance Company of
America; and Assistant Corporate Secretary of affiliated
American Skandia companies (1996-2004).
|
Lagan Srivastava
09/20/1977
|
|
Assistant Secretary
|
|
Since December 2006
|
|
Assistant Secretary of 79 funds in the Fund Complex and The
Korea Fund, Inc.; formerly, Research Assistant, Dechert LLP
(2004-2005); Research Assistant, Swidler Berlin Shereff Friedman
LLP
(2002-2004).
|
|
|
|
*
|
|
Unless otherwise noted, the address of the Funds officers
is Allianz Global Investors Fund Management LLC, 1345 Avenue of
the Americas,
4
th
Floor, New York, New York 10105.
|
18
Investment Manager and Sub-Adviser.
The
Manager, located at 1345 Avenue of the Americas, New York, New
York 10105, serves as the investment manager of the Fund. The
Manager retains its affiliate, PIMCO, as Sub-Adviser to manage
the Funds investments. PIMCO is located at 800 Newport
Center Drive, Newport Beach, CA 92660. The Manager and the
Sub-Adviser are each majority-owned indirect subsidiaries of
Allianz SE, a publicly traded European insurance and financial
services company.
Legal Proceedings.
In June and September 2004,
the Manager and certain of its affiliates (including PEA Capital
LLC (PEA), Allianz Global Investors Distributors LLC
and Allianz Global Investors of America, L.P.) agreed to settle,
without admitting or denying the allegations, claims brought by
the SEC and the New Jersey Attorney General alleging violations
of federal and state securities laws with respect to certain
open-end funds for which the Manager serves as investment
adviser. The settlements related to an alleged market
timing arrangement in certain open-end funds formerly
sub-advised by PEA. The Manager and its affiliates agreed to pay
a total of $68 million to settle the claims. In addition to
monetary payments, the settling parties agreed to undertake
certain corporate governance, compliance and disclosure reforms
related to market timing, and consented to cease and desist
orders and censures. Subsequent to these events, PEA
deregistered as an investment adviser and dissolved. None of the
settlements alleged that any inappropriate activity took place
with respect to the Fund.
Since February 2004, the Manager, and certain of its affiliates
and their employees have been named as defendants in a number of
pending lawsuits concerning market timing, which
allege the same or similar conduct underlying the regulatory
settlements discussed above. The market timing lawsuits have
been consolidated in a multi-district litigation proceeding in
the United States District Court for the District of Maryland.
Any potential resolution of these matters may include, but not
be limited to, judgments or settlements for damages against the
Manager, or its affiliates or related injunctions.
The Manager and the Sub-Adviser believe that these matters are
not likely to have a material adverse effect on the Fund or on
their ability to perform their respective investment advisory
activities relating to the Fund.
The foregoing speaks only as of the date of this proxy statement.
Independent Registered Public Accounting
Firm.
The Audit Oversight Committee of the
Funds Board unanimously selected PricewaterhouseCoopers
LLP (PwC) as the independent registered public
accounting firm for the fiscal year ending October 31,
2009. PwC served as the independent registered public accounting
firm of the Fund for the last fiscal year and also serves as the
independent registered public accounting firm of various other
investment companies for which the Manager and the Sub-Adviser
serve as investment adviser or sub-adviser. PwC is located at
300 Madison Avenue, New York, New York 10017. The Fund does not
know of any direct financial or material indirect financial
interest of PwC in the Fund.
A representative of PwC, if requested by any Stockholder, will
be present at the Meeting via telephone to respond to
appropriate questions from Stockholders and will have an
opportunity to make a statement if he or she chooses to do so.
Pre-approval Policies and Procedures.
The
Funds Audit Oversight Committee has adopted written
policies relating to the pre-approval of audit and permitted
non-audit services to be performed by the Funds
independent registered public accounting firm. Under the
policies, on an annual basis, the Funds Audit Oversight
Committee reviews and pre-approves proposed audit and permitted
non-audit services to be performed by the independent registered
public accounting firm on behalf of the Fund. The President of
the Fund also pre-approves any permitted non-audit services to
be provided to the Fund.
In addition, the Funds Audit Oversight Committee
pre-approves annually any permitted non-audit services
(including audit-related services) to be provided by the
independent registered public accounting firm to the Manager,
the Sub-Adviser and any entity controlling, controlled by, or
under common control with the
19
Manager that provides ongoing services to the Fund (together,
the Accounting Affiliates), provided, in each case,
that the engagement relates directly to the operations and
financial reporting of the Fund.
Although the Audit Oversight Committee does not pre-approve all
services provided by the independent registered public
accounting firm to Accounting Affiliates (for instance, if the
engagement does not relate directly to the operations and
financial reporting of the Fund), the Committee receives an
annual report from the independent registered public accounting
firm showing the aggregate fees paid by Accounting Affiliates
for such services.
The Funds Audit Oversight Committee may also from time to
time pre-approve individual non-audit services to be provided to
the Fund or an Accounting Affiliate that were not pre-approved
as part of the annual process described above. The Chairman of
the Funds Audit Oversight Committee (or any other member
of the Committee to whom this responsibility has been delegated)
may also pre-approve these individual non-audit services,
provided that the fee for such services does not exceed certain
pre-determined dollar thresholds. Any such pre-approval by the
Chairman (or by a delegate) is reported to the full Audit
Oversight Committee at its next regularly scheduled meeting.
The pre-approval policies provide for waivers of the requirement
that the Audit Oversight Committee pre-approve permitted
non-audit services provided to the Fund or its Accounting
Affiliates pursuant to de minimis exceptions described in
Section 10A of the Exchange Act and applicable regulations
(referred to herein as the de minimis exception).
Audit Fees.
Audit Fees are fees related to the
audit and review of the financial statements included in annual
reports and registration statements, and other services that are
normally provided in connection with statutory and regulatory
filings or engagements. For the Funds last two fiscal
years, the Audit Fees billed by PwC are shown in the table below:
|
|
|
|
|
Fiscal Year Ended
|
|
Audit Fees
|
|
|
October 31, 2008
|
|
$
|
39,000
|
|
October 31, 2007
|
|
$
|
36,000
|
|
Audit-Related Fees.
Audit-Related Fees are
fees related to assurance and related services that are
reasonably related to the performance of the audit or review of
financial statements, but not reported under Audit
Fees above, and that include accounting consultations,
agreed-upon
procedure reports (inclusive of annual review of basic
maintenance testing associated with the Preferred Shares),
attestation reports and comfort letters. The table below shows,
for the Funds last two fiscal years, the Audit-Related
Fees billed by PwC to the Fund.
|
|
|
|
|
Fiscal Year Ended
|
|
Audit-Related Fees
|
|
|
October 31, 2008
|
|
$
|
8,000
|
|
October 31, 2007
|
|
$
|
8,000
|
|
Tax Fees.
Tax Fees are fees associated with
tax compliance, tax advice and tax planning, including services
relating to the filing or amendment of federal, state or local
income tax returns, regulated investment company qualification
reviews, and tax distribution and analysis reviews. The table
below shows, for the Funds last two fiscal years, the
aggregate Tax Fees billed by PwC to the Fund. During those
fiscal years, there were no Tax Fees billed by PwC to the
Funds Accounting Affiliates for audit-related services
related directly to the operation and financial reporting of the
Fund.
|
|
|
|
|
Fiscal Year Ended
|
|
Tax Fees
|
|
|
October 31, 2008
|
|
$
|
6,700
|
|
October 31, 2007
|
|
$
|
6,500
|
|
20
All Other Fees.
All Other Fees are fees
related to services other than those reported above under
Audit Fees, Audit-Related Fees and
Tax Fees. For the Funds last two fiscal years,
no such fees were billed by PwC to the Fund or the Funds
Accounting Affiliates. During the periods indicated in the
tables above, no services described under Audit-Related
Fees, Tax Fees or All Other Fees
were approved pursuant to the de minimis exception.
Aggregate Non-Audit Fees.
The aggregate
non-audit fees billed by PwC, during the Funds last two
fiscal years, for services rendered to the Fund and the
Funds Accounting Affiliates are shown in the table below:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Aggregate Non-
|
|
|
Non-Audit Fees for
|
|
|
|
|
|
|
Audit Fees
|
|
|
Accounting
|
|
|
Aggregate
|
|
Fiscal Year Ended
|
|
for Fund
|
|
|
Affiliates
|
|
|
Non-Audit Fees
|
|
|
October 31, 2008
|
|
$
|
14,700
|
|
|
$
|
3,894,972
|
|
|
$
|
3,909,672
|
|
October 31, 2007
|
|
$
|
14,500
|
|
|
$
|
2,769,324
|
|
|
$
|
2,783,824
|
|
The Funds Audit Oversight Committee has determined that
the provision by PwC of non-audit services to the Funds
Accounting Affiliates that were not pre-approved by the
Committee were compatible with maintaining the independence of
PwC as the Funds principal auditors.
Other Business.
As of the date of this Proxy
Statement, the Funds officers and the Manager know of no
business to come before the Meeting other than as set forth in
the Notice. If any other business is properly brought before the
Meeting, including any adjournment thereof, the persons named as
proxies on the enclosed proxy cards will vote in their sole
discretion.
Quorum, Adjournments and Methods of
Tabulation.
A quorum for the Fund at the Meeting
will consist of the presence in person or by proxy of
Stockholders of the Fund entitled to cast at least a majority
(greater than 50%) of the votes entitled to be cast. In the
absence of a quorum at the Meeting or, even if a quorum is
present, in the event that sufficient votes in favor of the
Proposals set forth in the Notice are not received by the time
scheduled for the Meeting, the persons named as proxies may
propose one or more adjournments of the Meeting after the date
set for the original Meeting within 120 days after the
Record Date, with no other notice than announcement at the
Meeting, to permit further solicitation of proxies with respect
to the Proposals. In addition, if, in the judgment of the
persons named as proxies, it is advisable to defer action on a
Proposal, the persons named as proxies may propose one or more
adjournments of the Meeting with respect to the Proposal for a
reasonable time. The persons named as proxies will vote in favor
of such adjournment those proxies which they are entitled to
vote in favor of the Proposal. They will vote against any such
adjournment those proxies required to be voted against the
Proposal. The costs of any additional solicitation and of any
adjourned session will be borne by the Fund. Any proposals
properly before the Meeting for which sufficient favorable votes
have been received by the time of the Meeting will be acted upon
and such action will be final regardless of whether the Meeting
is adjourned to permit additional solicitation with respect to
any other proposal
Votes cast by proxy or in person at the Meeting will be counted
by persons appointed by the Fund as inspectors of election (the
Inspectors) for the Meeting. For purposes of
determining the presence of a quorum for the Fund, the
Inspectors will count the total number of votes cast
for or against approval of the Proposal
for the Fund, as well as Shares represented by proxies that
reflect abstentions and broker non-votes
(
i.e.
, shares held by brokers or nominees as to which
instructions have not been received from the beneficial owners
or the persons entitled to vote and the broker or nominee does
not have the discretionary voting power on a particular matter).
With respect to the election of Directors (Proposal I),
abstentions will not be counted as votes cast and will have no
effect on the result of the vote with respect to
Proposal I, although they will be considered present for
the purpose of determining the presence of a quorum. With
respect to the vote on the proposed
21
Liquidation (Proposal II), abstentions and broker non-votes
will have the same effect as votes against Proposal II,
although they will be considered present for the purpose of
determining the presence of a quorum.
Reports to Stockholders.
The 2008 Annual
Report to Stockholders for the Fund was mailed to Stockholders
on or about December 29, 2008.
Additional copies of the
Annual Report may be obtained without charge from the Fund by
calling 1-877-819-2224 or by writing to the Fund at 1345 Avenue
of the Americas, New York, NY 10105.
Stockholder Proposals for 2010 Annual
Meeting.
If Proposal II is approved, the
Fund does not expect to hold another annual meeting of
Stockholders. If Proposal II is not approved, or if the
Liquidation of the Fund is not completed prior to such time, it
is currently anticipated that the Funds next annual
meeting of Stockholders after the Meeting addressed in this
Proxy Statement will be held in February 2010. Proposals of
Stockholders intended to be presented at that annual meeting of
the Fund must be received by the Fund no later than
October 7, 2009 for inclusion in the Funds proxy
statement and proxy cards relating to that meeting. The
submission by a Stockholder of a proposal for inclusion in the
proxy materials does not guarantee that it will be included.
Stockholder proposals are subject to certain requirements under
the federal securities laws and must be submitted in accordance
with the Funds Bylaws. Stockholders submitting any other
proposals for the Fund intended to be presented at the 2010
annual meeting (
i.e
., other than those to be included in
the Funds proxy materials) must ensure that such proposals
are received by the Fund, in good order and complying with all
applicable legal requirements and requirements set forth in the
Funds Bylaws, no earlier than December 7, 2009 and no
later than December 22, 2009. If a Stockholder who wishes
to present a proposal fails to notify the Fund within these
dates, the proxies solicited for the meeting will have
discretionary authority to vote on the Stockholders
proposal if it is properly brought before the meeting. If a
Stockholder makes a timely notification, the proxies may still
exercise discretionary voting authority under circumstances
consistent with the SECs proxy rules. Stockholder
proposals should be addressed to the attention of the Secretary
of the applicable Fund, at the address of the principal
executive offices of the Fund, with a copy to David C. Sullivan,
Ropes & Gray LLP, One International Place, Boston,
Massachusetts
02110-2624.
Stockholders
Sharing an Address
The Fund is permitted to mail only one copy of this proxy
statement to a household, even if more than one person in a
household is a Fund stockholder of record, unless the Fund has
received contrary instructions from one or more of the
stockholders. If you need additional copies of this proxy
statement and you are a holder of record of your shares, please
call
1-800-331-1710.
If your shares are held in broker street name please contact
your financial service firm to obtain additional copies of this
proxy statement. If in the future you do not want the mailing of
proxy statements and information statements to be combined with
those of other members of your household, or if you have
received multiple copies of this proxy statement and want future
mailings to be combined with those of other members of your
household, please contact the Manager in writing at Allianz
Global Investors Fund Management LLC,
c/o PFPC,
PO Box 43027, Providence, RI 02940, or by telephone at
1-800-331-1710,
or contact your financial service firm.
PLEASE EXECUTE AND RETURN THE ENCLOSED PROXY CARDS PROMPTLY
TO ENSURE THAT A QUORUM IS PRESENT AT THE ANNUAL MEETING. A
SELF-ADDRESSED, POSTAGE-PAID ENVELOPE IS ENCLOSED FOR YOUR
CONVENIENCE.
February 4, 2009
22
Exhibit A
to Proxy Statement
Allianz
Global Investors Fund Management Sponsored Closed-End
Funds
Audit Oversight Committee Charter
(Adopted as
of January 14, 2004,
as amended through
June 10, 2008)
The Board of Trustees (each a Board) of each of the
registered investment companies listed in
Appendix A
hereto (each a Fund and, collectively, the
Funds), as the same may be periodically updated, has
adopted this Charter to govern the activities of the Audit
Oversight Committee (the Committee) of the
particular Board with respect to its oversight of the Fund. This
Charter applies separately to each Fund and its particular Board
and Committee, and shall be interpreted accordingly. This
Charter supersedes and replaces any audit committee charter
previously adopted by the Board or a committee of the Board.
Statement
of Purpose and Functions
The Committees general purpose is to oversee the
Funds accounting and financial reporting policies and
practices and its internal controls, including by assisting with
the Boards oversight of the integrity of the Funds
financial statements, the Funds compliance with legal and
regulatory requirements, the qualifications and independence of
the Funds independent auditors, and the performance of the
Funds internal control systems and independent auditors.
The Committees purpose is also to prepare reports required
by Securities and Exchange Commission rules to be included in
the Funds annual proxy statements, if any.
The Committees function is oversight. While the Committee
has the responsibilities set forth in this Charter, it is not
the responsibility of the Committee to plan or conduct audits,
to prepare or determine that the Funds financial
statements are complete and accurate and are in accordance with
generally accepted accounting principles, or to assure
compliance with laws, regulations or any internal rules or
policies of the Fund. Fund management is responsible for Fund
accounting and the implementation and maintenance of the
Funds internal control systems, and the independent
auditors are responsible for conducting a proper audit of the
Funds financial statements. Members of the Committee are
not employees of the Funds and, in serving on this Committee,
are not, and do not hold themselves out to be, acting as
accountants or auditors. As such, it is not the duty or
responsibility of the Committee or its members to conduct
field work or other types of auditing or accounting
reviews or procedures. Each member of the Committee shall be
entitled to rely on (i) the integrity of those persons and
organizations within management and outside the Fund from which
the Committee receives information and (ii) the accuracy of
financial and other information provided to the Committee by
such persons or organizations absent actual knowledge to the
contrary.
Membership
The Committee shall be comprised of as many trustees as the
Board shall determine, but in any event not less than three
(3) Trustees. Each member of the Committee must be a member
of the Board. The Board may remove or replace any member of the
Committee at any time in its sole discretion. One or more
members of the Committee may be designated by the Board as the
Committees chairman or co-chairman, as the case may be.
Each member of the Committee may not be an interested
person of the Fund, as defined in Section 2(a)(19) of
the Investment Company Act of 1940, as amended (the
Investment Company Act), and must otherwise satisfy
the standards for independence of an audit committee member of
an investment
A-1
company issuer as set forth in
Rule 10A-3(b)
(taking into account any exceptions to those requirements set
for in such rule) under the Securities Exchange Act of 1934, as
amended, and under applicable listing standards of the New York
Stock Exchange (the NYSE). Each member of the
Committee must be financially literate (or must
become so within a reasonable time after his or her appointment
to the Committee) and at least one member of the Committee must
have accounting or related financial management
expertise, in each case as the Board interprets such
qualification in its business judgment under NYSE listing
standards.
Responsibilities
and Duties
The Committees policies and procedures shall remain
flexible to facilitate the Committees ability to react to
changing conditions and to generally discharge its functions.
The following describe areas of attention in broad terms. The
Committee shall:
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1.
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Determine the selection, retention or termination of the
Funds independent auditors based on an evaluation of their
independence and the nature and performance of the audit and any
permitted non-audit services. Decisions by the Committee
concerning the selection, retention or termination of the
independent auditors shall be submitted to the Board for
ratification in accordance with the requirements of
Section 32(a) of the Investment Company Act. The
Funds independent auditors must report directly to the
Committee, which shall be responsible for resolution of
disagreements between management and the independent auditors
relating to financial reporting.
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2.
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To consider the independence of the Funds independent
auditors at least annually, and in connection therewith receive
on a periodic basis formal written disclosures and letters from
the independent auditors as required by the Independence
Standards Board Standard (ISB) No. 1.
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3.
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To the extent required by applicable regulations, pre-approve
(i) all audit and permitted non-audit services rendered by
the independent auditors to the Fund and (ii) all non-audit
services rendered by the independent auditors to the Funds
investment advisers (including sub-advisers) and to certain of
the investment advisers affiliates. The Committee may
implement policies and procedures by which such services are
approved other than by the full Committee.
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4.
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Review the fees charged by the independent auditors to the Fund,
the investment advisers and certain affiliates of the investment
advisers for audit, audit-related and permitted non-audit
services.
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5.
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If and to the extent that the Fund intends to have employees,
set clear policies for the hiring by the Fund of employees or
former employees of the Funds independent auditors.
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6.
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Obtain and review at least annually a report from the
independent auditors describing (i) the accounting
firms internal quality-control procedures and
(ii) any material issues raised (a) by the accounting
firms most recent internal quality-control review or peer
review or (b) by any governmental or other professional
inquiry or investigation performed within the preceding five
years respecting one or more independent audits carried out by
the firm, and any steps taken to address any such issues.
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7.
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Review with the Funds independent auditors arrangements
for and the scope of the annual audit and any special audits,
including the form of any opinion proposed to be rendered to the
Board and shareholders of the Fund.
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8.
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Meet with management and the independent auditors to review and
discuss the Funds annual audited financial statements,
including a review of any specific disclosures of
managements discussion of the Funds investment
performance; and, with respect to the Funds audited
financial
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A-2
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statements, discuss with the independent auditors matters
required by Statement of Accounting Standards (SAS)
No. 61 and any other matters required to be reported to the
Committee under applicable law; and provide a statement whether,
based on its review of the Funds audited financial
statements, the Committee recommends to the Board that the
audited financial statements be included in the Funds
Annual Report.
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Meet with management to review and discuss the Funds
unaudited financial statements included in the semi-annual
report, including, if any, a review of any specific disclosure
of managements discussion of the Funds investment
performance.
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9.
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Discuss with management and the independent auditors the
Funds unaudited financial statements.
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10.
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Review with the independent auditors any audit problems or
difficulties encountered in the course of their audit work and
managements responses thereto.
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11.
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Review with management and, as applicable, with the independent
auditors the Funds accounting and financial reporting
policies, practices and internal controls, managements
guidelines and policies with respect to risk assessment and risk
management, including the effect on the Fund of any
recommendation of changes in accounting principles or practices
by management or the independent auditors.
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12.
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Discuss with management any press releases discussing the
Funds investment performance and other financial
information about the Fund, as well as any financial information
provided by management to analysts or rating agencies. The
Committee may discharge this responsibility by discussing the
general types of information to be disclosed by the Fund and the
form of presentation (
i.e.
, a
case-by-case
review is not required) and need not discuss in advance each
such release of information.
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13.
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Establish procedures for (i) the receipt, retention, and
treatment of complaints received by the Fund regarding
accounting, internal accounting controls, or auditing matters;
and (ii) the confidential, anonymous submission by
employees of the Fund, the Funds investment advisers,
administrator, principal underwriter (if any) or any other
provider of accounting-related services for the investment
advisers of concerns regarding accounting or auditing matters.
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14.
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Investigate or initiate the investigation of any improprieties
or suspected improprieties in the Funds accounting
operations or financial reporting.
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15.
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Review with counsel legal and regulatory matters that have a
material impact on the Funds financial and accounting
reporting policies and practices or its internal controls.
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16.
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Report to the Board on a regular basis (at least annually) on
the Committees activities.
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17.
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Perform such other functions consistent with this Charter, the
Agreement and Declaration of Trust and Bylaws applicable to the
Fund, and applicable law or regulation, as the Committee or the
Board deems necessary or appropriate.
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The Committee may delegate any portion of its authority and
responsibilities as set forth in this Charter to a subcommittee
of one or more members of the Committee.
A-3
Meetings
At least annually, the Committee shall meet separately with the
independent auditors and separately with the representatives of
Fund management responsible for the financial and accounting
operations of the Fund. The Committee shall hold other regular
or special meetings as and when it deems necessary or
appropriate.
Outside
Resources and Assistance from Management
The appropriate officers of the Fund shall provide or arrange to
provide such information, data and services as the Committee may
request. The Committee shall have the authority to engage at the
Funds expense independent counsel and other experts and
consultants whose expertise the Committee considers necessary to
carry out its responsibilities. The Fund shall provide for
appropriate funding, as determined by the Committee, for the
payment of: (i) compensation of the Funds independent
auditors for the issuance of an audit report relating to the
Funds financial statements or the performance of other
audit, review or attest services for the Fund;
(ii) compensation of independent legal counsel or other
advisers retained by the Committee; and (iii) ordinary
administrative expenses of the Committee that are necessary or
appropriate in fulfilling its purposes or carrying out its
responsibilities under this Charter.
Annual
Evaluations
The Committee shall review and reassess the adequacy of this
Charter at least annually and recommend any changes to the
Board. In addition, the performance of the Committee shall be
reviewed at least annually by the Board.
Adoption
and Amendments
The Board shall adopt and approve this Charter and may amend the
Charter at any time on the Boards own motion.
A-4
Appendix A
Funds
Subject to this Charter
(As of
June 10, 2008)
ALLIANZ
FUNDS MULTI STRATEGY TRUST
(MST)
FIXED INCOME SHARES
(FISH)
NFJ DIVIDEND, INTEREST & PREMIUM STRATEGY FUND
(NFJ)
NICHOLAS-APPLEGATE CONVERTIBLE & INCOME FUND
(NCV)
NICHOLAS-APPLEGATE CONVERTIBLE & INCOME
FUND II
(NCZ)
NICHOLAS-APPLEGATE EQUITY & CONVERTIBLE INCOME FUND
(NIE)
NICHOLAS-APPLEGATE GLOBAL EQUITY & CONVERTIBLE
INCOME FUND
(NGZ)
NICHOLAS-APPLEGATE INTERNATIONAL & PREMIUM STRATEGY
FUND
(NAI)
PCM FUND, INC.
(PCM)
PIMCO CALIFORNIA MUNICIPAL INCOME FUND
(PCQ)
PIMCO CALIFORNIA MUNICIPAL INCOME FUND II
(PCK)
PIMCO CALIFORNIA MUNICIPAL INCOME FUND III
(PZC)
PIMCO CORPORATE INCOME FUND
(PCN)
PIMCO CORPORATE OPPORTUNITY FUND
(PTY)
PIMCO FLOATING RATE INCOME FUND
(PFL)
PIMCO FLOATING RATE STRATEGY FUND
(PFN)
PIMCO GLOBAL STOCKSPLUS & INCOME FUND
(PGP)
PIMCO HIGH INCOME FUND
(PHK)
PIMCO INCOME OPPORTUNITY FUND
(PKO)
PIMCO MUNICIPAL ADVANTAGE FUND INC.
(MAF)
PIMCO MUNICIPAL INCOME FUND
(PMF)
PIMCO MUNICIPAL INCOME FUND II
(PML)
PIMCO MUNICIPAL INCOME FUND III
(PMX)
PIMCO NEW YORK MUNICIPAL INCOME FUND
(PNF)
PIMCO NEW YORK MUNICIPAL INCOME FUND II
(PNI)
PIMCO NEW YORK MUNICIPAL INCOME FUND III
(PYN)
PIMCO STRATEGIC GLOBAL GOVERNMENT FUND INC.
(RCS)
Exhibit B
to Proxy Statement
Report of
Audit Oversight Committee
of the Board of Directors of
PIMCO Municipal Advantage Fund Inc. (the
Fund)
Dated December 22, 2008
The Audit Oversight Committee (the Committee)
oversees the Funds financial reporting process on behalf
of the Board of Directors of the Fund (the Board)
and operates under a written Charter adopted by the Board. The
Committee meets with the Funds management
(Management) and independent registered public
accounting firm and reports the results of its activities to the
Board. Management has the primary responsibility for the
financial statements and the reporting process, including the
system of internal controls. In connection with the
Committees and independent accountants
responsibilities, Management has advised that the Funds
financial statements for the fiscal year ended October 31,
2008 were prepared in conformity with the generally accepted
accounting principles.
The Committee has reviewed and discussed with Management and
PricewaterhouseCoopers LLP (PwC), the Funds
independent registered public accounting firm, the audited
financial statements for the fiscal year ended October 31,
2008. The Committee has discussed with PwC the matters required
to be discussed by Statements on Auditing Standard No. 61
(SAS 61). SAS 61 requires independent registered public
accounting firms to communicate to the Committee matters
including, if applicable: 1) methods used to account for
significant unusual transactions; 2) the effect of
significant accounting policies in controversial or emerging
areas for which there is a lack of authoritative guidance or
consensus; 3) the process used by management in formulating
particularly sensitive accounting estimates and the basis for
the auditors conclusions regarding the reasonableness of
those estimates; and 4) disagreements with Management over
the application of accounting principles and certain other
matters.
With respect to the Fund, the Committee has received the written
disclosure and the letter from PwC required by Independence
Standards Board Standard No. 1 (requiring auditors to make
written disclosure to and discuss with the Committee various
matters relating to the auditors independence), and has
discussed with PwC their independence. The Committee has also
reviewed the aggregate fees billed by PwC for professional
services rendered to the Fund and for non-audit services
provided to Allianz Global Investors Fund Management LLC
(AGIFM), the Funds investment manager, Pacific
Investment Management Company LLC (PIMCO), the
Funds investment adviser and any entity controlling,
controlled by or under common control with AGIFM or PIMCO that
provided services to the Fund. As part of this review, the
Committee considered, in addition to other practices and
requirements relating to selection of the Funds
independent registered public accounting firm, whether the
provision of such non-audit services was compatible with
maintaining the independence of PwC.
Based on the foregoing review and discussions, the Committee
presents this Report to the Board and recommends that
(1) the audited financial statements for the fiscal year
ended October 31, 2008 be included in the Funds Annual
Report to shareholders for such fiscal year, (2) such
Annual Report be filed with the Securities and Exchange
Commission and the New York Stock Exchange, and (3) PwC be
reappointed as the Funds independent registered public
accounting firm for the fiscal year ending October 31, 2009.
Submitted by the Audit Committee of the Board of Directors:
Paul Belica
Robert E. Connor
Hans W. Kertess
William B. Ogden, IV
R. Peter Sullivan III
Diana L. Taylor
B-1
Exhibit C
to Proxy Statement
PLAN OF
LIQUIDATION AND DISSOLUTION
OF
PIMCO MUNICIPAL ADVANTAGE FUND, INC.
This Plan of Liquidation and Dissolution (the
Plan
) for PIMCO Municipal Advantage Fund,
Inc. (the
Fund
), a corporation organized and
existing under the laws of Maryland and registered as a
closed-end management investment company under the Investment
Company Act of 1940, as amended (the
Investment Company
Act
), is intended to accomplish the complete
liquidation of the Funds assets and dissolution of the
Fund in conformity with the provisions of the Funds
Articles of Restatement (the
Articles
) and
By-Laws and Maryland law.
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1.
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Approval of Plan and Effective Date. The Plan will be submitted
to the Funds Board of Directors on December 22, 2008
for approval by the Funds Board of Directors, including a
majority of the directors who are not interested
persons (as defined in the Investment Company Act) of the
Fund, that the proposed liquidation and dissolution of the Fund
is in accordance with the Plan and that the Plan is advisable
and in the best interests of the Funds stockholders. Under
Maryland law and the Funds Articles of Restatement and
Bylaws, the Fund must also obtain stockholder approval to
liquidate and dissolve the Fund. Pending approval by the
Funds stockholders by an affirmative vote of a majority of
the votes entitled to be cast by the common and preferred
stockholders of the Fund, voting as a single class, the Plan
shall become effective at the close of business on or
about ,
2009 (the
Effective Date
).
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2.
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Cessation of Business. At the Effective Date, the Fund shall
cease its operations and thereafter shall not engage in any
business activities except for the purposes of managing the sale
of securities and the Funds cash levels. Within a
reasonable period after the Effective Date (taking into account
market conditions and other relevant factors), the directors and
officers of the Fund shall proceed to wind up the affairs of the
Fund; to pay or make provision for the payment of the
Funds debts and liabilities; to reduce the remaining
assets of the Fund to distributable form in cash and to
distribute the proceeds to or for the account of the
stockholders of the Fund.
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3.
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Fixing of Interests and Closing of Books. For purposes of
determining the stockholders of the Fund entitled to receive
payment of all Liquidating Distributions (as defined below), the
proportionate interests of stockholders in the assets of the
Fund shall be fixed on the basis of their respective
shareholdings at the close of business on the Effective Date, or
on such later date as may be determined by the Board (the
Determination Date
). On the Determination
Date, the books of the Fund shall be closed. Thereafter, unless
the books are reopened because the Plan cannot be carried into
effect under the laws of the State of Maryland or otherwise, the
Stockholders respective interests in the Funds
assets shall not be transferable by the negotiation of share
certificates and the Funds common shares will cease to be
traded on the New York Stock Exchange, Inc. (the
NYSE
).
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4.
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Termination of the Fund. The Fund shall be terminated as soon as
reasonably practicable after the Effective Date and the
completion of the implementation of this Plan, which date of
termination of the Fund shall be determined by the President of
the Fund or other authorized officer (the
Termination
Date
).
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5.
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Notice of Liquidation of the Fund. As soon as practicable after
the Effective Date, the Fund shall mail notice to its known
creditors, if any, at their addresses as shown on the
Funds records, that
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this Plan has been approved by the Board of Directors and the
stockholders and that the Fund will be liquidating its assets,
to the extent that such notice is required under the Maryland
General Corporation Law (the MGCL).
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6.
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Payment of Liabilities and Expenses. Within a reasonable period
after the Effective Date, the Fund shall determine, and there
shall be paid or otherwise provided for, all charges, taxes,
expenses, liabilities and reserves, whether due or accrued or
anticipated, of the Fund (collectively,
Debts
).
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7.
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Liquidating Distributions. As soon as reasonably practicable
after the Determination Date and following the payment or other
provision for Debts of the Fund, the remaining assets of the
Fund shall be distributed to or for the account of the
stockholders of the Fund, at any one or more times, and shall
proceed in the order of priority provided below (each a
Liquidating Distribution
):
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1.
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First, to the preferred stockholders, the amount of $50,000 per
preferred share, plus an amount equal to all accumulated but
unpaid dividends thereon (whether or not earned or declared) to
but not including the date of such Liquidating Distribution, in
same-day
funds; and
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2.
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Second, after determination of any dividend to be paid pursuant
to paragraph 7.a. of this Plan, all remaining amounts to
the common stockholders, ratably according to the number of
shares of the Fund held by such common stockholders on the
Determination Date. In the event the assets of the Fund
available for distribution upon liquidation to the preferred
stockholders are insufficient to make full payments to which
such holders are entitled in accordance with the By-Laws of the
Fund, payment shall be made pro rata among all such preferred
stockholders. It is intended that any and all amounts of a
Liquidating Distribution to preferred stockholders comprising a
dividend shall be characterized in a manner consistent with
Revenue Ruling
89-81,
1989-1
C.B.
226.
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The Liquidating Distribution to common stockholders will
include, if necessary, a dividend equal to the sum of
(i) the amount, if any, required to avoid the imposition of
tax under section 852 of the Internal Revenue Code of 1986,
as amended (the
Code
) on investment company
taxable income and net capital gain for each of the Funds
(a) most recently completed taxable year, and (b) the
subsequent taxable period ending on the Liquidation Date and
(ii) the additional amount, if any, required to avoid the
imposition of tax under section 4982 of the Code on
ordinary income and capital gain net income. The Board of
Directors of the Fund hereby declares that the dividend so paid
shall be deemed for all purposes to have been conclusively
declared on the date of this Plan. It is intended that any and
all amounts of a Liquidating Distribution to common stockholders
comprising such a dividend shall be characterized in a manner
consistent with Revenue Ruling
89-81,
1989-1
C.B.
226.
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8.
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Deregistration under the Investment Company Act. As soon as
practicable after the Termination Date, the Fund shall take
action to become deregistered as an investment company under the
Investment Company Act, and the officers of the Fund shall take
such other actions as may be deemed necessary or advisable to
carry out the provisions and purposes of this Plan.
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9.
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Dissolution under Maryland Law.
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1.
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Within the time frame set forth above, the Fund shall cause to
be filed Articles of Dissolution with the State Department of
Assessments and Taxation of Maryland, pursuant to
Sections 3-406
and 3-407 of the MGCL.
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2.
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Not less than twenty (20) days prior to filing the Articles
of Dissolution with the State Department of Assessments and
Taxation of Maryland, as set forth above, the Fund shall mail
notice that the dissolution of the Fund has been approved to all
of its known creditors, if any,
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C-2
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and to its remaining employees, if any, pursuant to
Section 3-404
of the MGCL. It is anticipated that the Fund shall have no known
creditors or employees at such time.
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3.
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The officers of the Fund shall, prior to filing of the formal
documents necessary to terminate the legal existence of the
Fund, apply for and obtain from the State Department of
Assessments and Taxation of Maryland a list of all municipal and
county tax collectors (the
Collectors
) to
whom personal property taxes assessed by the Department against
the Fund are payable, and shall obtain certificates from the
Comptroller of the Treasury of the State of Maryland and from
each of the Collectors to the effect that all such taxes, except
those barred by limitations, have been paid, including taxes
billed for the year in which the termination of existence is to
be effective.
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10.
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Additional Tax Matters.
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1.
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This
Plan
is intended to, and shall, constitute a plan of
liquidation constituting the complete liquidation of the Fund,
as described in Section 331, or 332, as the case may be,
and Section 562(b) of the Code.
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2.
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Within thirty (30) days after the date of the adoption of
this Plan by the Funds stockholders, the officers of the
Fund shall file a return on Form 966 with the Internal
Revenue Service, as required by Section 6043(a) of the
Code, for and on behalf of the Fund.
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11.
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Authority of Officers. The officers of the Fund shall have
authority to do or authorize any or all acts and things as
provided for in this Plan and any and all such further acts and
things as they may consider necessary or advisable to carry out
the purposes of this Plan, including preparing and executing
documents, information returns, tax returns, forms, and other
papers which may be necessary or appropriate to implement this
Plan or which may be required by the provisions of the
Investment Company Act or any other applicable laws. Without
limiting the generality of the foregoing, the officers and
directors are authorized and empowered:
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1.
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To sell any and all property of the Fund at private or public
sales (and if at public sales, then upon such public notices as
may be determined to be necessary and appropriate), for such
consideration and upon such terms as they may deem proper, and
to collect the accounts receivable or to compromise, settle or
otherwise convert the same into cash;
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2.
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To declare to or for the accounts of the stockholders a
liquidating distribution or liquidating distributions in kind or
in cash;
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3.
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To execute for or on behalf of the Fund, in its corporate name
and under its corporate seal, such contracts of sale, deeds,
assignments, bills of sale and other papers as may be necessary,
desirable or convenient in connection with the carrying out of
this Plan; and
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4.
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To pay all costs and expenses, including debts, salaries and
bonuses to directors, officers and employees, taxes and other
liabilities incurred by the Fund or by such directors or
officers in connection with the carrying out of this Plan.
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12.
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Amendment of Plan. A majority of the Board of Directors shall
have the power to authorize such variations from or amendments
of the provisions of this Plan as may be necessary or
appropriate to effect the complete liquidation and dissolution
of the Fund, and the distribution of assets to stockholders in
accordance with the purposes to be accomplished by this Plan.
Except as provided in the foregoing sentence, this Plan shall be
irrevocable.
|
C-3
PROXY
PIMCO MUNICIPAL ADVANTAGE FUND INC.
COMMON SHARES
PROXY IN CONNECTION WITH THE ANNUAL MEETING OF
STOCKHOLDERS TO BE HELD ON FEBRUARY 26, 2009
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF THE FUND
The undersigned holder of common shares of Municipal Advantage Fund Inc., a Maryland corporation
(the Fund), hereby appoints Lawrence G. Altadonna, Thomas J. Fuccillo and Brian S. Shlissel, or
any of them, as proxies for the undersigned, with full power of substitution in each of them, to
attend the Annual Meeting of Stockholders of the Fund (the Annual Meeting) to be held at 9:30
a.m., Eastern Time, February 26, 2009 at the offices of Allianz Global Investors Fund Management
LLC, 1345 Avenue of the Americas, between West 54th and West 55th streets, 49th Floor, New York,
New York 10105, and any postponement or adjournment thereof, to cast on behalf of the undersigned
all votes that the undersigned is entitled to cast at the Annual Meeting and otherwise to represent
the undersigned with all powers possessed by the undersigned as if personally present at such Annual
Meeting. The undersigned hereby acknowledges receipt of the Notice of Meeting and accompanying
Proxy Statement and revokes any proxy heretofore given with respect to the Annual Meeting.
IF THIS
PROXY IS PROPERLY EXECUTED, THE VOTES ENTITLED TO BE CAST BY THE
UNDERSIGNED WILL BE CAST IN THE MANNER DIRECTED ON THE REVERSE SIDE HEREOF, AND WILL BE VOTED IN
THE DISCRETION OF THE PROXY HOLDER(S) ON ANY OTHER MATTERS THAT MAY PROPERLY COME BEFORE THE ANNUAL
MEETING OR ANY ADJOURNMENT OR POSTPONEMENT THEREOF. IF THIS PROXY IS PROPERLY EXECUTED BUT NO
DIRECTION IS MADE REGARDING THE PROPOSALS FOR THE ELECTION OF DIRECTORS OR THE LIQUIDATION AND DISSOLUTION OF THE FUND INCLUDED IN THE PROXY STATEMENT, SUCH VOTES
ENTITLED TO BE CAST BY THE UNDERSIGNED WILL BE CAST FOR EACH PROPOSAL.
Please refer to the Proxy Statement for a discussion of the Election of Directors and the proposed Liquidation and Dissolution of the Fund.
PLEASE VOTE, DATE AND SIGN ON THE REVERSE SIDE HEREOF
AND RETURN THE SIGNED PROXY PROMPTLY IN THE ENCLOSED ENVELOPE.
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HAS YOUR ADDRESS CHANGED?
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DO YOU HAVE ANY COMMENTS?
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Using a black ink pen, mark your votes with an X as shown in this example. Please do not write
outside the designated areas.
þ
ANNUAL MEETING PROXY CARD
I. Election of Directors
The Board of Directors recommends that you vote FOR the election of
the Nominees.
Nominees
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(01) R. Peter Sullivan III (Class III)
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For
o
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Withhold
o
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(02) Diana L. Taylor (Class II)
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For
o
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Withhold
o
|
II. Approval of Liquidation and Dissolution
The Board of Directors recommends that you vote
FOR the proposal to liquidate and dissolve the Fund, as set forth in the Plan of Liquidation and
Dissolution adopted by the Board of Directors of the Fund:
For the Proposal
o
Against the Proposal
o
Withhold from the Proposal
o
PIMCO MUNICIPAL ADVANTAGE FUND INC.
COMMON SHARES
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Please check box at right if an address change or comment
has been made on the reverse side of this card.
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o
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Please be sure to sign and date this Proxy.
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Shareholder
signature:
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Date:
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Joint Owner
(if any) signature:
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Date:
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NOTE:
Please sign this proxy exactly as your name(s) appear(s) on the books of the Fund. Joint
owners should each sign personally. Trustees and other fiduciaries should indicate the capacity in
which they sign, and where more than one name appears, a majority must sign. If a corporation,
partnership or other entity, the signature should be that of an authorized officer who should state
his or her title.
HOW TO VOTE
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Vote In Person
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o
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Vote By Internet
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o
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Vote By Telephone
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o
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PROXY
PIMCO MUNICIPAL ADVANTAGE FUND INC.
PREFERRED SHARES
PROXY IN CONNECTION WITH THE ANNUAL MEETING OF
STOCKHOLDERS TO BE HELD ON FEBRUARY 26, 2009
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF THE FUND
The undersigned holder of preferred shares of Municipal Advantage Fund Inc., a Maryland corporation
(the Fund), hereby appoints Lawrence G. Altadonna, Thomas J. Fuccillo and Brian S. Shlissel, or
any of them, as proxies for the undersigned, with full power of substitution in each of them, to
attend the Annual Meeting of Stockholders of the Fund (the Annual Meeting) to be held at 9:30
a.m., Eastern Time, February 26, 2009 at the offices of Allianz Global Investors Fund Management
LLC, 1345 Avenue of the Americas, between West 54th and West 55th streets, 49th Floor, New York,
New York 10105, and any postponement or adjournment thereof, to cast on behalf of the undersigned
all votes that the undersigned is entitled to cast at the Annual Meeting and otherwise to represent
the undersigned with all powers possessed by the undersigned as if personally present at such Annual
Meeting. The undersigned hereby acknowledges receipt of the Notice of Meeting and accompanying
Proxy Statement and revokes any proxy heretofore given with respect to the Annual Meeting.
IF THIS PROXY IS PROPERLY EXECUTED, THE VOTES ENTITLED TO BE CAST BY THE
UNDERSIGNED WILL BE CAST IN THE MANNER DIRECTED ON THE REVERSE SIDE HEREOF, AND
WILL BE VOTED IN THE DISCRETION OF THE PROXY HOLDER(S) ON ANY OTHER MATTERS THAT
MAY PROPERLY COME BEFORE THE ANNUAL MEETING OR ANY ADJOURNMENT OR POSTPONEMENT
THEREOF. IF THIS PROXY IS PROPERLY EXECUTED BUT NO DIRECTION IS MADE
REGARDING THE PROPOSALS FOR THE ELECTION OF
DIRECTORS OR THE LIQUIDATION AND DISSOLUTION OF THE FUND INCLUDED IN THE PROXY STATEMENT, SUCH VOTES ENTITLED TO BE CAST BY THE UNDERSIGNED WILL
BE CAST FOR EACH PROPOSAL.
Please refer to the Proxy Statement for a
discussion of the Election of Directors and the proposed Liquidation
and Dissolution of the Fund.
PLEASE VOTE, DATE AND SIGN ON THE REVERSE SIDE HEREOF
AND RETURN THE SIGNED PROXY PROMPTLY IN THE ENCLOSED ENVELOPE.
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HAS YOUR ADDRESS CHANGED?
|
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DO YOU HAVE ANY COMMENTS?
|
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Using a black ink pen, mark your votes with an X as shown in this example. Please do not write
outside the designated areas.
þ
ANNUAL MEETING PROXY CARD
I. Election of Directors
The Board of Directors recommends that you vote FOR the election of
the Nominees.
Nominees
|
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|
|
|
(01) R. Peter Sullivan III (Class III)
|
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For
o
|
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Withhold
o
|
(02) Diana L. Taylor (Class II)
|
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For
o
|
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Withhold
o
|
II. Approval of Liquidation and Dissolution
The Board of Directors recommends that you vote
FOR the proposal to liquidate and dissolve the Fund, as set forth in the Plan of Liquidation and
Dissolution adopted by the Board of Directors of the Fund:
For the Proposal
o
Against the Proposal
o
Withhold from the Proposal
o
PIMCO MUNICIPAL ADVANTAGE FUND INC.
PREFERRED SHARES
|
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|
Please check box at right if an address change or comment
has been made on the reverse side of this card.
|
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o
|
Please be sure to sign and date this Proxy.
|
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Shareholder
signature:
|
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Date:
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Joint Owner
(if any) signature:
|
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Date:
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NOTE:
Please sign this proxy exactly as your name(s) appear(s) on the books of the Fund. Joint
owners should each sign personally. Trustees and other fiduciaries should indicate the capacity in
which they sign, and where more than one name appears, a majority must sign. If a corporation,
partnership or other entity, the signature should be that of an authorized officer who should state
his or her title.
HOW TO VOTE
|
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Vote In Person
|
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|
o
|
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Vote By Internet
|
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|
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|
o
|
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Vote By Telephone
|
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o
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