SCHEDULE 14A
(RULE 14A-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(A) of the Securities
Exchange Act of 1934 (Amendment No.__ )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement [ ] Confidential, for Use of the Commission Only
(as permitted by Rule 14a-6(e)(2))
[X ] Definitive Proxy Statement
[ ] Definitive additional materials
[ ] Soliciting material pursuant to Rule 14a-11(c) or Rule 14a-12
THE BRAZIL FUND, INC.
(Name of Registrant as Specified in Its Charter)
(Name of Person(s) Filing Proxy Statement,
if other than the Registrant)
Payment of filing fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
(2) Aggregate number of securities to which transaction applies:
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):
(4) Proposed maximum aggregate value of transaction:
(5) Total fee paid:
[ ] Fee paid previously with preliminary materials:
[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identity the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the form or schedule and the date of its filing.
(1) Amount previously paid:
(2) Form, Schedule or Registration Statement no.:
(3) Filing Party:
(4) Date Filed:
[LOGO OMITTED]
345 Park Avenue (at 51st Street)
New York, New York 10154
(800) 349-4281
The Brazil Fund, Inc. May 25, 2004
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To the Stockholders:
The Annual Meeting of Stockholders of The Brazil Fund, Inc. (the "Fund") is to
be held at 10:45 a.m., Eastern time, on Wednesday, July 7, 2004 at the offices
of Deutsche Investment Management Americas Inc., part of Deutsche Asset
Management, 29th Floor, East Side, 280 Park Avenue (at 48th-49th Streets), New
York, New York 10017. Stockholders who are unable to attend this meeting are
strongly encouraged to vote by proxy, which is customary in corporate meetings
of this kind. A Proxy Statement regarding the meeting, a proxy card for your
vote at the meeting and an envelope -- postage prepaid -- in which to return
your proxy are enclosed.
At the Annual Meeting the stockholders will elect three Directors. In addition,
the stockholders present will hear a report on the Fund. There will be an
opportunity to discuss matters of interest to you as a stockholder. All of our
independent directors plan to attend this meeting and look forward to meeting
interested stockholders.
Your Fund's Directors recommend that you vote in favor of the three nominees for
Directors.
Respectfully,
/s/Robert J. Callander
Robert J. Callander
Chairman of the Board
on behalf of the full Board
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STOCKHOLDERS ARE URGED TO SIGN THE PROXY CARD AND MAIL IT IN THE ENCLOSED
POSTAGE-PREPAID ENVELOPE SO AS TO ENSURE A QUORUM AT THE MEETING. THIS IS
IMPORTANT WHETHER YOU OWN FEW OR MANY SHARES.
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THE BRAZIL FUND, INC.
Notice of Annual Meeting of Stockholders
To the Stockholders of
The Brazil Fund, Inc.:
Please take notice that the Annual Meeting of Stockholders of The Brazil Fund,
Inc. (the "Fund") has been called to be held at the offices of Deutsche
Investment Management Americas Inc., part of Deutsche Asset Management, 29th
Floor, East Side, 280 Park Avenue (at 48th-49th Streets), New York, New York
10017, on Wednesday, July 7, 2004 at 10:45 a.m., Eastern time, for the following
purpose:
To elect three Directors of the Fund to hold office for a term of three
years and until their successors shall have been duly elected and
qualified.
The appointed proxies will vote on any other business as may properly come
before the meeting or any adjournments or postponements thereof.
Holders of record of the shares of common stock of the Fund at the close of
business on April 8, 2004 are entitled to vote at the meeting and any
adjournments or postponements thereof.
By order of the Board of Directors,
/s/John Millette
John Millette, Secretary
May 25, 2004
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IMPORTANT -- We urge you to sign and date the enclosed proxy card and return it
in the enclosed addressed envelope which requires no postage and is intended for
your convenience. Your prompt return of the enclosed proxy card may save the
Fund the necessity and expense of further solicitations to ensure a quorum at
the Annual Meeting. If you can attend the meeting and wish to vote your shares
in person at that time, you will be able to do so.
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PROXY STATEMENT
General
This Proxy Statement is furnished in connection with the solicitation of proxies
by the Board of Directors of The Brazil Fund, Inc., a Maryland corporation, (the
"Fund"), for use at the Annual Meeting of Stockholders, to be held at the
offices of Deutsche Investment Management Americas Inc., ("DeIM" or the
"Investment Manager"), part of Deutsche Asset Management, 29th Floor, East Side,
280 Park Avenue (at 48th-49th Streets), New York, New York 10017, on Wednesday,
July 7, 2004 at 10:45 a.m., Eastern time, and at any adjournments or
postponements thereof (collectively, the "Meeting").
This Proxy Statement, the Notice of Annual Meeting and the proxy card are first
being mailed to stockholders on or about May 25, 2004, or as soon as practicable
thereafter. Any stockholder giving a proxy has the power to revoke it prior to
the time the proxy is exercised by attending the Meeting and casting his or her
votes in person or by mail, by executing a superseding proxy or by submitting a
notice of revocation to the Fund (addressed to the Secretary at the principal
executive office of the Fund, 345 Park Avenue, New York, New York 10154). All
properly executed proxies received in time for the Meeting will be voted as
specified in the proxy or, if no specification is made, for each of the nominees
for director named in the Proxy Statement and in the discretion of the proxy
holders on any other matter that may properly come before the Meeting.
The presence at any stockholders' meeting, in person or by proxy, of
stockholders entitled to cast a majority of the votes entitled to be cast at the
Meeting shall be necessary and sufficient to constitute a quorum for the
transaction of business. For purposes of determining the presence of a quorum
for transacting business at the Meeting, abstentions and broker "non-votes" will
be treated as shares that are present but which have not been voted. Broker
non-votes are proxies received by the Fund from brokers or nominees when the
broker or nominee has neither received instructions from the beneficial owner or
other persons entitled to vote nor has discretionary power to vote on a
particular matter. Accordingly, stockholders are urged to forward their voting
instructions promptly.
With respect to the election of director nominees, abstentions and
broker-non-votes will have the same effect as a vote not to elect the nominees,
because election of a nominee requires the affirmative vote of a majority of the
shares present in person or by proxy and entitled to vote. See "Proposal:
Election of Directors -- Required Vote."
Holders of record of the common stock of the Fund at the close of business on
April 8, 2004 (the "Record Date") will be entitled to one vote per share on all
business of the Meeting and any adjournments or postponements. There were
16,241,288 shares of common stock outstanding on the Record Date.
The Fund provides periodic reports to all stockholders which include relevant
information, including investment results and a review of portfolio changes. You
may receive an additional copy of the annual report for the fiscal year ended
June 30, 2003 and a copy of the semiannual report for the six-month period ended
December 31, 2003, without charge, by calling 800-349-4281 or 800-294-4366 or
writing the Fund at 345 Park Avenue, New York, New York 10154.
1
PROPOSAL: ELECTION OF DIRECTORS
Persons named on the accompanying proxy card intend, in the absence of contrary
instructions, to vote all proxies for the election of the three nominees listed
below as Directors of the Fund to serve for a term of three years and until
their respective successors are duly elected and qualify. The nominees have
consented to stand for election and to serve if elected. If any such nominee
should be unable to serve, an event not now anticipated, the proxies will be
voted for such person, if any, as shall be designated by the Board of Directors
to replace any such nominee. For election of Directors at the Meeting, the Board
of Directors has approved the nomination of the individuals listed below.
Information Concerning Nominees
The following table sets forth certain information concerning each of the three
nominees as a Director of the Fund. Each of the nominees is now a Director of
the Fund. Unless otherwise noted, each of the nominees has engaged in the
principal occupation listed in the following table for more than five years, but
not necessarily in the same capacity.
Class III -- Nominees to serve until 2007 Annual Meeting of Stockholders:
Aggregate Dollar Range of
Equity Securities in All
Present Office with the Registered Investment
Fund, if any; Principal Dollar Range of Companies Overseen by
Name (Age) Occupation or Employment Year First Equity Securities Director in Family of
Address and Directorships Became a in the Fund as of Investment Companies as
Interested Director in Publicly Held Companies Director April 30, 2004^1 of April 30, 2004^1
-------------------------------------------------------------------------------------------------------------------
[GRAPHIC OMITTED] Vice Chairman (since 2004 None None
2004) of the Board of
Vincent J. Esposito the Fund; Managing
(47)* Director, DeAM (since
c/o Deutsche Investment 2003). Vice President
Management of Central European
Americas Inc. Equity Fund, Inc.
345 Park Avenue (since 2003); Vice
New York, NY 10154 President of The
Germany Fund, Inc.
(since 2003); Vice
President of The New
Germany Fund, Inc.
(since 2003)
(registered investment
companies). Mr.
Esposito serves on the
boards of three other
funds managed by DeIM.
Managing Director,
Putnam Investments
(1991-2002).
-------------------------------------------------------------------------------------------------------------------
2
Class III -- Nominees to serve until 2007 Annual Meeting of Stockholders:
Aggregate Dollar Range of
Equity Securities in All
Present Office with the Registered Investment
Fund, if any; Principal Dollar Range of Companies Overseen by
Name (Age) Occupation or Employment Year First Equity Securities Director in Family of
Address and Directorships Became a in the Fund as of Investment Companies as
Independent Directors** in Publicly Held Companies Director April 30, 2004^1 of April 30, 2004^1
-------------------------------------------------------------------------------------------------------------------
[GRAPHIC OMITTED] Director and Chief 1987 $50,001- Over $100,000
Executive Officer, IMF $100,000
Ronaldo A. da Frota Editora Ltd. (financial
Nogueira (65) publisher); Chairman of
c/o Deutsche the Certification
Investment Management Committee and Director,
Americas Inc. APIMEC Nacional
345 Park Avenue (Brazilian Association
New York, NY 10154 of Investment
Professionals and
Analysts); Member,
Board of Association of
Certified International
Investment Analysts
(ACIIA). Mr. Nogueira
serves on the boards of
three other funds
managed by DeIM.
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3
Aggregate Dollar Range of
Equity Securities in All
Present Office with the Registered Investment
Fund, if any; Principal Dollar Range of Companies Overseen by
Name (Age) Occupation or Employment Year First Equity Securities Director in Family of
Address and Directorships Became a in the Fund as of Investment Companies as
Independent Directors** in Publicly Held Companies Director April 30, 2004^1 of April 30, 2004^1
-------------------------------------------------------------------------------------------------------------------
[GRAPHIC OMITTED] Non-Profit 2001 $1-$10,000 $10,001-$50,000
Organizations: Vice
Susan Kaufman President, Council of
Purcell (61) the Americas; Vice
c/o Deutsche Investment President, Americas
Management Society; For-Profit
Americas Inc. Corporate Boards:
345 Park Avenue Director, Valero Energy
New York, NY 10154 Corporation; Non-Profit
Directorships: Freedom
House, Foundation for
Management Education in
Central America (FMECA),
National Endowment for
Democracy (until 1999)
and Women's Foreign
Policy Group (1999-Jan.
2004); Member, Advisory
Board, The
Inter-American
Foundation; Member,
Council on Foreign
Relations; and Member,
The Economic Club of New
York (private club).
Previously Member,
Policy Planning Staff,
US Department of State
and Associate Professor
of Political Science,
University of
California, Los Angeles
(UCLA). Dr. Purcell
serves on the boards of
three other funds
managed by DeIM.
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4
Information Concerning Continuing Directors
The Board of Directors is divided into three classes, with each Director serving
for a term of three years. The terms of the Class I and II Directors do not
expire this year. The following table sets forth certain information regarding
the Directors in such classes. Unless otherwise noted, each Director has engaged
in the principal occupation listed in the following table for more than five
years, but not necessarily in the same capacity. It is currently anticipated
that Messrs. Callander and Luers will resign from the Board on or about April
30, 2005 in accordance with the Board's retirement policy.
Class I -- Directors to serve until 2005 Annual Meeting of Stockholders:
Aggregate Dollar Range of
Equity Securities in All
Present Office with the Registered Investment
Fund, if any; Principal Dollar Range of Companies Overseen by
Name (Age) Occupation or Employment Year First Equity Securities Director in Family of
Address and Directorships Became a in the Fund as of Investment Companies as
Independent Directors** in Publicly Held Companies Director April 30, 2004^1 of April 30, 2004^1
-------------------------------------------------------------------------------------------------------------------
[GRAPHIC OMITTED] Professor (formerly 2001 None None
Dean, 1999-2001),
Kesop Yun (58) College of Business
c/o Deutsche Investment Administration, Seoul
Management National University,
Americas Inc. Seoul, Korea; Director,
345 Park Avenue The Korea
New York, NY 10154 Liberalisation Fund,
Inc. (U.K.)
(1996-1999); Visiting
Professor of London
Business School
(1997-1998); President,
Korea Securities &
Economy Institute
(1994-1995); President,
Korea Tax Association
(1994-1995). Mr. Yun
serves on the boards of
three other funds
managed by DeIM.
-------------------------------------------------------------------------------------------------------------------
5
Class I -- Directors to serve until 2005 Annual Meeting of Stockholders:
Aggregate Dollar Range of
Equity Securities in All
Present Office with the Registered Investment
Fund, if any; Principal Dollar Range of Companies Overseen by
Name (Age) Occupation or Employment Year First Equity Securities Director in Family of
Address and Directorships Became a in the Fund as of Investment Companies as
Independent Directors** in Publicly Held Companies Director April 30, 2004^1 of April 30, 2004^1
-------------------------------------------------------------------------------------------------------------------
[GRAPHIC OMITTED] President and Chief Executive 1997 $1-$10,000 $10,001-$50,000
Officer, United Nations
William H. Luers (75) Associates of U.S.A.; Director,
c/o Deutsche Investment Wickes Lumber Company (building
Management materials), America Online Latin
Americas Inc. America, and Rubin Art Museum
345 Park Avenue (Asian art museum)
New York, NY 10154 (2003-present); Member: Advisory
Board, The Trust for Mutual
Understanding and Christie's
Inc. (art auction house)
(2003-present); Trustee:
Rockefeller Brothers Fund,
Trustee Advisory Council --
Appeal of Conscience Foundation;
formerly, President,
Metropolitan Museum of Art
(1986-1999) (retired), Director,
StoryFirst Communications, Inc.
(owns television and radio
stations in Russia and Ukraine)
(1996-1999), The Eurasia
Foundation (2000-2002), IDEX
Corporation (liquid handling
equipment manufacturer)
(1991-2003); Member, Executive
Committee and Board of
Directors, East-West Institute
(1988-2002). Mr. Luers serves on
the boards of three other funds
managed by DeIM.
-------------------------------------------------------------------------------------------------------------------
6
Class II-- Directors to serve until 2006 Annual Meeting of Stockholders:
Aggregate Dollar Range of
Equity Securities in All
Present Office with the Registered Investment
Fund, if any; Principal Dollar Range of Companies Overseen by
Name (Age) Occupation or Employment Year First Equity Securities Director in Family of
Address and Directorships Became a in the Fund as of Investment Companies as
Independent Directors** in Publicly Held Companies Director April 30, 2004^1 of April 30, 2004^1
-------------------------------------------------------------------------------------------------------------------
[GRAPHIC OMITTED] Chairman (since 2004) 2000 $10,001- $50,001-$100,000
of the Board of the $50,000
Robert J. Callander Fund; Retired Vice
(73) Chairman, Chemical
c/o Deutsche Investment Banking Corporation;
Management Directorships: ARAMARK
Americas Inc. Corporation (food
345 Park Avenue service); Member,
New York, NY 10154 Council on Foreign
Relations; Previously
Visiting
Professor/Executive-in-Residence,
Columbia University
Business School;
Formerly, Director,
Barnes Group, Inc.
(manufacturing) (until
April 2001) and
Metropolitan Opera
Association (retired).
Mr. Callander serves on
the boards of three
other funds managed by
DeIM.
[GRAPHIC OMITTED] Clinical Professor of 1997 $10,001- $50,001-$100,000
Finance, NYU Stern $50,000
Kenneth C. Froewiss School of Business;
(58) (1997-present) Member,
c/o Deutsche Investment Finance Committee,
Management Association for Asian
Americas Inc. Studies; (2002-present);
345 Park Avenue Managing Director, J.P.
New York, NY 10154 Morgan (investment
banking firm)
(1984-1996). Mr.
Froewiss serves on the
boards of three other
funds managed by DeIM.
-------------------------------------------------------------------------------------------------------------------
All Directors and Officers as a group 6,488 Shares Less than 1/4 of 1% of
Shares of the Fund
-------------------------------------------------------------------------------------------------------------------
* Director considered by the Fund and its counsel to be an "interested
person" (which as used in this proxy statement is as defined in the
Investment Company Act of 1940, as amended) of the Fund or of the Fund's
investment manager, DeIM. Mr. Esposito is deemed to be an interested person
because of his affiliation with the Fund's investment manager, DeIM, or
because he is an Officer of the Fund or both.
** Director considered by the Fund and its counsel not to be "interested
persons" of the Fund or of the Fund's investment manager, DeIM.
^1 The information as to beneficial ownership is based on statements furnished
to the Fund by the Directors and nominees. Unless otherwise noted,
beneficial ownership is based on sole voting and investment power.
7
Section 16(a) Beneficial Ownership Reporting Compliance
Section 16(a) of the Securities Exchange Act of 1934 (the "Exchange Act") and
Section 30(h) of the Investment Company Act of 1940, as amended (the "1940
Act"), as applied to a closed-end management investment company, require the
Fund's Officers and Directors, investment manager, investment advisor,
affiliates of the Fund's investment manager and investment advisor, and persons
who beneficially own more than ten percent of a registered class of the Fund's
outstanding securities ("Reporting Persons"), to file reports of ownership of
the Fund's securities and changes in such ownership with the Securities and
Exchange Commission (the "SEC"). Such persons are required by SEC regulations to
furnish the Fund with copies of all such filings.
Based on a review of reports filed by the Fund's directors and executive
officers, the Investment Manager, officers and directors of the Investment
Manager, affiliated persons of the Investment Manager and beneficial holders of
10% or more of the Fund's outstanding stock, and written representations by the
Reporting Persons that no year-end reports were required for such persons, all
filings required by Section 16(a) of the Exchange Act for the fiscal year ended
June 30, 2003 were timely. As a convenience to the directors, the Investment
Manager assists the directors in making their Section 16 filings.
According to filings made with the SEC in February 2004, February 2004 and April
2004, respectively, the following owned beneficially more than 5% of the Fund's
outstanding stock:
Schedule 13G/A, President & Fellows of Harvard College, c/o Harvard Management
Company Inc., 600 Atlantic Avenue, Boston, MA 02110, reported beneficial
ownership as of December 31, 2003 of 4,046,600 shares, or 24.8% of the Fund's
shares.
Schedule 13G/A, Lazard Asset Management LLC, 30 Rockefeller Plaza, New York, NY
10112, reported beneficial ownership as of December 31, 2003 of 1,302,000
shares, or 7.9% of the Fund's shares.
Schedule 13D, The Carrousel Fund Ltd., The Carrousel Fund II Limited, Carrousel
Capital Ltd. and Bruno Sangle-Ferriere, c/o Bruno Sangle-Ferriere, Carrousel
Capital Ltd., 203-205 Brompton Road, London SW3 1LA, reported beneficial
ownership of 979,185 shares, or 5.07% of the Fund's shares.
Except as noted above, to the best of the Fund's knowledge, as of April 30,
2004, no other person owned beneficially more than 5% of the Fund's outstanding
stock.
Honorary Director
Mr. Roberto Teixeira da Costa serves as an Honorary Director of the Fund.
Honorary Directors are invited to attend all Board meetings and to participate
in Board discussions, but are not entitled to vote on any matter presented to
the Board. Mr. da Costa became a Director of the Fund in 1993 and retired from
the Board in 2001.
Committees of the Board -- Board Meetings
The Board of Directors of the Fund met seven times during the fiscal year ended
June 30, 2003. Each Director attended at least 75% of the total number of
meetings of the Board of Directors and of all committees of the Board on which
he or she served as regular members, except Nicholas Bratt, a former Director,
who attended 43% of the meetings.
The Board of Directors seeks to have at least a majority of its members present
at annual stockholder meetings. At the Fund's last annual stockholder meeting on
July 9, 2003, all Directors were in attendance.
8
The Board of Directors, in addition to an Executive Committee, has an Audit
Committee, a Valuation Committee and a Committee on Independent Directors.
Audit Committee
The Board has an Audit Committee, consisting of those Directors who are not
interested persons of the Fund or of the Investment Manager ("Independent
Directors") as defined in the 1940 Act, which met three times during the fiscal
year ended June 30, 2003. The members of the Audit Committee are independent, as
independence is defined in the listing standards of the New York Stock Exchange.
The Audit Committee reviews with management and the independent accountants for
the Fund, among other things, the scope of the audit and the controls of the
Fund and its agents, reviews and discusses with management the Fund's annual
audited financial statements, reviews the auditor's required communications
regarding the scope and results of the audit that may assist the Audit Committee
in overseeing management's financial reporting and disclosure process, reviews
and approves in advance the type of services to be rendered by independent
accountants, approves and recommends to the Board for its approval the selection
of independent accountants for the Fund, reviews matters related to the
independence of the Fund's independent accountants and in general considers and
reports to the Board on matters regarding the Fund's accounting and bookkeeping
practices.
Audit Committee's Pre-Approval Policies and Procedures. The Audit Committee must
approve the engagement of the independent accountants to provide audit or
non-audit services to the Fund and non-audit services to DeIM or its control
affiliates that relate directly to the Fund's operations and financial reporting
prior to the commencement of any such engagement. In addition, the independent
accountants must notify the Fund's Audit Committee not later than the Audit
Committee's next meeting if the independent accountants enter into an engagement
to provide audit or non-audit-related services to DeIM or its control affiliates
that are not for services to the Fund or services that relate directly to the
Fund's operations and financial reporting whose projected fees are in excess of
$25,000. Such notification must include a general description of the services
awarded, the entity that is to be the recipient of such services, the timing of
the engagement, the entity's reason for selecting the independent accountants,
and the projected fees.
The Board of Directors has adopted a written charter for the Audit Committee,
which is attached to this Proxy Statement as Appendix A.
At a meeting held on April 7, 2004, the Board of Directors of the Fund,
including a majority of the Independent Directors, selected
PricewaterhouseCoopers LLP to act as independent accountants for the Fund for
the fiscal year ending June 30, 2005. The Fund's financial statements for the
fiscal years ended June 30, 2003 and June 30, 2002 and for the six-month periods
ended December 31, 2002 and December 31, 2001 were audited by
PricewaterhouseCoopers LLP. The following table sets forth the aggregate fees
billed for professional services rendered by PricewaterhouseCoopers LLP:
Audit-Related Fees All Other Fees
-------------------------------------------------------------------------------------------------------------
Fiscal Year Ended Audit Fees^1 Tax Fees Fund DeIM-Related Fund DeIM-Related
-------------------------------------------------------------------------------------------------------------
June 30, 2002 $91,300 $15,700 $1,400 $904,176 $0 $20,596,772
-------------------------------------------------------------------------------------------------------------
June 30, 2003 $95,700 $20,400 $400 $616,500 $0 $12,158,000
-------------------------------------------------------------------------------------------------------------
^1 The aggregate audit fees billed by PricewaterhouseCoopers LLP to all funds
managed by DeIM-related entities for each of the Fund's last two fiscal
years were $7,209,923 for the fiscal year ended June 30, 2002 and
$7,385,499 for the fiscal year ended June 30, 2003.
9
The fees disclosed in the table above under the caption "Audit Fees" are the
aggregate fees billed for each of the last two fiscal years for professional
services rendered for the audits of the Fund's annual and semi-annual financial
statements and review of financial statements included in the registrant's N-CSR
for services that are normally provided by the accountant in connection with
statutory and regulatory filings or engagements for those fiscal years. The fees
disclosed under the caption "Audit-Related Fees" are the aggregate fees billed
in each of the last two fiscal years for assurance and related services that are
reasonably related to the performance of the audit or review of the Fund's
financial statements and are not reported under "Audit Fees." "Tax Fees" are the
aggregate fees billed in each of the last two fiscal years for professional
services rendered for tax compliance and tax return preparation. "All Other
Fees" are the aggregate fees billed in each of the last two fiscal years for
products and services provided, other than the services described above. "All
Other Fees" were billed for services in connection with risk management, tax
services and process improvement/integration initiatives for DeIM and other
related entities that provide support for the operations of the Fund.
DeIM-Related Fees include fees billed for services, if any, in each of the last
two fiscal years to DeIM and all entities controlling, controlled by, or under
common control with DeIM that provide services to the Fund. For engagements
entered into on or after May 6, 2003, the Audit Committee pre-approved all
non-audit services that PricewaterhouseCoopers LLP provided to DeIM and
DeIM-related entities that related directly to the Fund's operations and
financial reporting.
The aggregate non-audit fees billed by PricewaterhouseCoopers LLP to the Fund,
DeIM and entities controlling, controlled by or under common control with DeIM
that provide services to the Fund for each of the Fund's last two fiscal years
were $21,518,048 for the fiscal year ended June 30, 2002 and $12,795,300 for the
fiscal year ended June 30, 2003. The Fund's Audit Committee gave careful
consideration to the non-audit related services provided by
PricewaterhouseCoopers LLP to the Fund, DeIM and entities controlling,
controlled by or under common control with DeIM that provide services to the
Fund, and, based in part on certain representations and information provided by
PricewaterhouseCoopers LLP, determined that the provision of these services was
compatible with maintaining PricewaterhouseCoopers LLP's independence.
Representatives of PricewaterhouseCoopers LLP are not expected to be present at
the Meeting, but will be available by telephone to respond to appropriate
questions and to make a statement if they wish to do so.
Audit Committee Report
In connection with the audited financial statements as of and for the fiscal
year ended June 30, 2003 included in the Fund's Annual Report for the fiscal
year ended June 30, 2003 (the "Annual Report"), at a meeting held on August 20,
2003, the Audit Committee reviewed and discussed the annual audited financial
statements with management and the independent accountants, and discussed the
audit of such financial statements with the independent accountants.
The Audit Committee also discussed with the independent accountants the matters
required to be discussed by Statement On Auditing Standards No. 61
(Communications with Audit Committees). The independent accountants provided to
the committee the written disclosure and the letter required by Independence
Standards Board Standard No. 1 (Independence Discussions with Audit Committees),
and the Audit Committee discussed with representatives of the independent
accountants their firm's independence.
10
The members of the Audit Committee are not professionally engaged in the
practice of auditing or accounting and are not employed by the Fund for
accounting, financial management or internal control. Moreover, the Audit
Committee relies on and makes no independent verification of the facts presented
to it or representations made by management or the independent accountants.
Accordingly, the Audit Committee's oversight does not provide an independent
basis to determine that management has maintained appropriate accounting and
financial reporting principles or policies, or internal controls and procedures,
designed to assure compliance with accounting standards and applicable laws and
regulations. Furthermore, the Audit Committee's considerations and discussions
referred to above do not provide assurance that the audit of the Fund's
financial statements has been carried out in accordance with auditing standards
generally accepted in the United States of America or that the financial
statements are presented in accordance with accounting principles generally
accepted in the United States of America.
Based on its consideration of the audited financial statements and the
discussions referred to above with management and the independent accountants
and subject to the limitation on the responsibilities and role of the Audit
Committee set forth in the Audit Committee's Charter and those discussed above,
the Audit Committee of the Fund recommended to the Board of Directors of the
Fund that the audited financial statements be included in the Fund's Annual
Report.
The Audit Committee currently consists of Messrs. Froewiss (Chairman),
Callander, Luers, Nogueira and Yun and Dr. Purcell.
Committee on Independent Directors
The Board has a Committee on Independent Directors consisting of the Independent
Directors. The Committee met once during the fiscal year ended June 30, 2003.
The primary purposes and responsibilities of the Committee are (i) to identify
individuals qualified to become members of the Board in the event that a
position is vacated or created; (ii) to recommend for the Board's selection the
Director nominees for the next annual meeting of stockholders; (iii) to set any
necessary standards or qualifications for service on the Board; (iv) to review
and evaluate the compensation practices of the Independent Directors and to
recommend any changes thereto to the Board; (v) to determine the policies
governing retirement of all Independent Directors; (vi) to perform periodic
evaluations of the effectiveness of the Independent Directors; and (vii) to
consider such other matters of special relevance to the Independent Directors.
The Committee met on April 7, 2004 to recommend the nominees for Independent
Directors presented in this proxy statement.
The Committee on May 10, 2004 met to recommend successors to fill vacancies that
would be created when Richard Hale, in connection with his forthcoming
retirement from the Investment Manager, submitted his resignation as a Class III
Director and Chairman of the Board of the Fund. To fill these vacancies the
Committee recommended, and the Board appointed, Mr. Esposito as a director in
Class III and as Vice Chairman of the Board. In addition, the Board elected Mr.
Callander, the Chairman of the Committee on Independent Directors, as Chairman
of the Board. The Board believes that its appointment of an Independent Director
as Chairman reaffirms the Board's longstanding commitment to strong, independent
oversight of the Fund's operations, and to progressive governance practices that
seek to protect and serve the interests of all Fund stockholders.
11
The Committee requires that Director candidates have a college degree or
equivalent business experience. The Committee may take into account a wide
variety of factors in considering Director candidates, 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 candidate's ability, judgment and expertise and (vi)
overall diversity of the Board's composition.
The Board of Directors has adopted a written charter for the Committee on
Independent Directors, which is attached to this Proxy Statement as Appendix B.
The Committee will consider and evaluate nominee candidates properly submitted
by stockholders on the same basis as it considers and evaluates candidates
recommended by other sources. Appendix A to the charter, as it may be amended
from time to time by the Committee, sets forth procedures that must be followed
by stockholders to properly submit a nominee candidate to the Committee.
Recommendations not properly submitted in accordance with Appendix A will not be
considered by the Committee. In order to be considered by the Committee for the
2005 annual meeting, submission should be made by January 25, 2005.
Executive Committee
The Executive Committee is empowered, and the Directors have delegated to such
Committee, all of the powers of the Directors that are not otherwise delegated
and that may lawfully be exercised by an executive committee. The Executive
Committee is authorized to act when the full Board of Directors is not in
session. Messrs. Callander and Esposito are the members of the Executive
Committee of the Fund. The Executive Committee did not meet during the fiscal
year ended June 30, 2003.
Valuation Committee
The Valuation Committee monitors the valuation of portfolio securities and other
investments and, as required by the Fund's valuation policies when the full
Board is not in session, determines the fair value of illiquid and other
portfolio holdings after consideration of all relevant factors, which
determinations are reported to the full Board. Messrs. Froewiss and Esposito are
the members of the Valuation Committee, with Messrs. Callander and Luers as
alternates. The Valuation Committee met once during the fiscal year ended June
30, 2003.
Stockholder Communications with Directors
The Fund has established procedures for stockholders to send communications to
the Board of Directors. Communications should be sent in writing to the Board of
Directors of The Brazil Fund, Inc., c/o John Millette, Secretary to the Fund,
345 Park Avenue, New York, New York 10154. The Secretary of the Fund then will
promptly forward copies of all written correspondence to the Directors.
12
Executive Officers
The following persons are Executive Officers of the Fund:
Present Office with the Fund; Year First Became
Name (Age) Principal Occupation or Employment^1 an Officer^2
----------------------------------------------------------------------------------------------------------------------
Julian F. Sluyters (43) President and Chief Executive Officer; Managing Director, 2004
Deutsche Asset Management (since May 2004); President and
Chief Executive Officer of The Korea Fund, Inc., Scudder
Global High Income Fund, Inc. and Scudder New Asia Fund,
Inc. (since May 2004); President and Chief Executive
Officer, UBS Fund Services (2001-2003); Chief
Administrative Officer (1998-2001) and Senior Vice
President and Director of Mutual Fund Operations
(1991-1998) UBS Global Asset Management.
Kate Sullivan D'Eramo (47) Assistant Treasurer; Director of Deutsche Asset Management. 2003
Tara C. Kenney (43) Vice President; Director of Deutsche Asset Management. 2000
John Millette (41) Vice President and Secretary; Director of Deutsche Asset 1999
Management.
Caroline Pearson (42) Assistant Secretary; Managing Director of Deutsche Asset 1998
Management.
Charles A. Rizzo (46) Treasurer and Chief Financial Officer; Managing Director 2002
(since 2004) and Director of Deutsche Asset Management
(2000-2004); prior thereto, Vice President and Department
Head, BT Alex. Brown Incorporated (now Deutsche Bank
Securities Inc.) (1998-1999); Senior Manager, Coopers &
Lybrand L.L.P. (now PricewaterhouseCoopers LLP) (1993-1998).
Paul H. Rogers (48) Vice President; Director of Deutsche Asset Management. 1998
Bruce Rosenblum (43) Vice President and Assistant Secretary; Director (since 2002
2002) and Vice President (2000-2002) of Deutsche Asset
Management; and partner with the law firm of
Freedman, Levy, Kroll & Simonds.
Salvatore Schiavone (38) Assistant Treasurer; Director of Deutsche Asset Management. 2003
Lucinda H. Stebbins (58) Assistant Treasurer; Director of Deutsche Asset Management. 2003
----------------------------------------------------------------------------------------------------------------------
^1 Unless otherwise stated, all Executive Officers have been associated with
DeIM, Deutsche Asset Management, or predecessor organizations for more than
five years, although not necessarily in the same capacity. Messrs. Rizzo,
Rogers, Schiavone and Esposito and Mses. D'Eramo, Kenney, Pearson and
Stebbins own securities of Deutsche Bank A.G.
^2 The President, Treasurer and Secretary each hold office until the next
annual meeting of the Board of Directors and until his successor has been
duly elected and qualifies, and all other officers hold office in
accordance with the bylaws of the Fund.
13
Transactions with and Remuneration of Directors and Officers
The aggregate direct remuneration incurred by the Fund for payment to
Independent Directors was $116,772, including expenses, for the fiscal year
ended June 30, 2003. Each such Independent Director currently receives fees,
paid by the Fund, of $750 per Directors' meeting attended and an annual
Director's fee of $6,000, except for Mr. Nogueira who as a Resident Brazilian
Director receives an annual fee of $12,000. Effective January 1, 2003, the Lead
Director of the Independent Directors (currently Mr. Callander) and the Chairman
of the Audit Committee (currently Mr. Froewiss) each receives an additional
$2,500 annual fee for serving in that capacity. Each Director also receives $250
per committee meeting attended (other than audit committee meetings and meetings
held for the purpose of considering arrangements between the Fund and the
Investment Manager or an affiliate of the Investment Manager, for which such
Director receives a fee of $750). DeIM supervises the Fund's investments, pays
the compensation and certain expenses of its personnel who serve as Directors
and Officers of the Fund, and receives a management fee for its services.
Several of the Fund's Officers and Directors are also officers, directors or
employees of DeIM and participate in the fees paid to that firm (see "Investment
Manager"), although the Fund makes no direct payments to them.
The following Compensation Table provides, in tabular form, the following data:
Column (1) All Directors who receive compensation from the Fund.
Column (2) Aggregate compensation received by a Director from the Fund.
Columns (3) and (4) Pension or retirement benefits accrued or proposed to be
paid by the Fund. The Fund does not pay such benefits to its Directors.
Column (5) Total compensation received by a Director from the Fund, plus
compensation received from all funds managed by DeIM for which a Director
serves. The total number of funds from which a Director receives such
compensation is also provided in column (5). Generally, compensation received by
a Director for serving on the Board of a closed-end fund is greater than the
compensation received by a Director for serving on the Board of an open-end
fund.
14
Compensation Table for the year ended December 31, 2003
------------------------------------------------------------------------------------------------------------
(1) (2) (3) (4) (5)
Name of Person, Aggregate Aggregate Compensation
Position Compensation Pension or Estimated Annual as a Director/Trustee
from the Fund Retirement Benefits Benefits Upon of the Fund and Other
Accrued as Part of Retirement Scudder Funds
Fund Expenses
Paid by Paid by
Funds DeIM*
------------------------------------------------------------------------------------------------------------
Robert J. Callander, $14,750 N/A N/A $64,250 $3,000
Director (4 funds)
Kenneth C. Froewiss, $15,500 N/A N/A $65,750 $3,000
Director (4 funds)
William H. Luers, $13,000 N/A N/A $55,750 $3,000
Director (4 funds)
Ronaldo A. da Frota $19,000 N/A N/A $61,750 $3,000
Nogueira, Director (4 funds)
Susan Kaufman Purcell, $12,250 N/A N/A $53,500 $3,000
Director (4 funds)
Kesop Yun, $13,000 N/A N/A $54,250 $3,000
Director (4 funds)
------------------------------------------------------------------------------------------------------------
* DeIM paid the fees of Independent Directors for attendance at a meeting to
discuss and approve the delegation of certain fund accounting and related
services to State Street Bank and Trust Company.
Required Vote
Election of each of the listed nominees for Director requires the affirmative
vote of the holders of a majority of the shares present in person or by proxy
and entitled to vote thereon. If a nominee does not receive the required vote,
the director holding over shall continue as a director until his or her
successor is elected and qualifies. in favor of Your Fund's Directors recommend
that stockholders vote FOR each of the listed nominees.
The Investment Manager
On April 5, 2002, Zurich Scudder Investments, Inc. ("Scudder"), the investment
manager of the Fund, was acquired by Deutsche Bank AG. Upon the closing of this
transaction, Scudder became part of Deutsche Asset Management and changed its
name to Deutsche Investment Management Americas Inc. ("DeIM" or the "Investment
Manager").
Under the supervision of the Board of Directors of the Fund, DeIM, with
headquarters at 345 Park Avenue, New York, New York, makes the Fund's investment
decisions, buys and sells securities for the Fund and conducts research that
leads to these purchase and sales decisions. DeIM and its predecessors have more
than 80 years of experience managing mutual funds. DeIM provides a full range of
investment advisory services to institutional and retail clients. The Investment
Manager is also responsible for selecting brokers and dealers and for
negotiating brokerage commissions and dealer charges.
15
Deutsche Asset Management is the marketing name in the US for the asset
management activities of Deutsche Bank AG, DeIM, Deutsche Asset Management Inc.,
Deutsche Asset Management Investment Services Ltd., Deutsche Bank Trust Company
Americas and Scudder Trust Company. Deutsche Asset Management is a global asset
management organization that offers a wide range of investing expertise and
resources, including hundreds of portfolio managers and analysts and an office
network that reaches the world's major investment centers. This well-resourced
global investment platform brings together a wide variety of experience and
investment insight, across industries, regions, asset classes and investing
styles. DeIM is an indirect wholly owned subsidiary of Deutsche Bank AG.
Deutsche Bank AG is a major global banking institution that is engaged in a wide
range of financial services, including investment management, mutual funds,
retail, private and commercial banking, investment banking and insurance.
The Investment Manager, the predecessor of which is Scudder, Stevens & Clark,
Inc., is one of the most experienced investment counseling firms in the US. It
was established as a partnership in 1919 and pioneered the practice of providing
investment counsel to individual clients on a fee basis. In 1928 it introduced
the first no-load mutual fund to the public. In 1953 Scudder introduced Scudder
International Fund, Inc., the first mutual fund available in the US investing
internationally in securities of issuers in several foreign countries. The
predecessor firm reorganized from a partnership to a corporation on June 28,
1985. On December 31, 1997, Zurich Insurance Company ("Zurich") acquired a
majority interest in Scudder, and Zurich Kemper Investments, Inc., a Zurich
subsidiary, became part of Scudder. Scudder's name changed to Scudder Kemper
Investments, Inc. On January 1, 2001, the Investment Manager changed its name
from Scudder Kemper Investments, Inc. to Zurich Scudder Investments, Inc. On
April 5, 2002, 100% of the Investment Manager was acquired by Deutsche Bank AG.
DeIM is a Delaware corporation. Evelyn Tressit1 is a Director and Chief
Operating Officer, William N. Shiebler^1 is a Director, President and Chief
Executive Officer; Jeffrey S. Wallace^1 is a Director, Chief Financial Officer
and Treasurer; William G. Butterly, II^2 is Secretary, Chief Legal Officer and
General Counsel; Stephen R. Burke^3, Thomas F. Eggers^3, Leo P. Grohowski^4, and
Gloria S. Nelund^5 each is an Executive Vice President; and Phillip W. Gallo^2
is the Chief Compliance Officer.
Other Matters
The Board of Directors does not know of any matters to be brought before the
Meeting other than that mentioned in this Proxy Statement. The appointed proxies
will vote on any other business that may come before the Meeting or any
adjournment or postponement thereof in their discretion.
----------------------------------
^1 280 Park Avenue, New York, NY 10017
^2 1251 Avenue of the Americas, New York, NY 10020
^3 1325 Avenue of the Americas, New York, NY 10019
^4 345 Park Avenue, New York, NY 10154
^5 300 South Grand Avenue, Los Angeles, CA 90071
16
Miscellaneous
Proxies will be solicited by mail and may be solicited in person or by telephone
by Officers of the Fund or personnel of DeIM. The Fund has retained Georgeson
Shareholder Communications Inc. ("Georgeson"), 17 State Street, New York, New
York 10004 to assist in the proxy solicitation. The cost of Georgeson's services
is estimated at $9,500 plus expenses and also a $20,000 consulting fee for
services in relation to a potential Carrousel Fund I solicitation. The costs and
expenses connected with the solicitation of the proxies and with any further
proxies which may be solicited by the Fund's Officers or Georgeson, in person or
by telephone, will be borne by the Fund. The Fund will reimburse banks, brokers,
and other persons holding the Fund's shares registered in their names or in the
names of their nominees, for their expenses incurred in sending proxy material
to and obtaining proxies from the beneficial owners of such shares.
Certain information about the employees of the Investment Manager who will be
soliciting proxies on the Fund's behalf is set forth in Appendix D. Appendix E
sets forth certain other information relating to the Directors and executive
officers of the Fund and these employees (collectively, the "Participants").
Solicitation of proxies is being made primarily by the mailing of this Proxy
Statement with its enclosures on or about May 25, 2004. As mentioned above,
Georgeson will assist in the solicitation of proxies. As the meeting date
approaches, certain stockholders may receive a telephone call from a
representative of Georgeson if their proxies have not been received.
Authorization to permit Georgeson to execute proxies may be obtained by
telephonic or electronically transmitted instructions from stockholders of the
Fund. If proxies are obtained telephonically, they will be recorded in
accordance with procedures that are consistent with applicable law and that the
Fund believes are reasonably designed to ensure that both the identity of the
stockholder casting the vote and the voting instructions of the stockholder are
accurately determined.
If a stockholder wishes to participate in the Meeting, but does not wish to give
a proxy by telephone or electronically, the stockholder may still submit the
proxy card originally sent with this proxy statement. Should stockholders
require additional information regarding the proxy or a replacement proxy card,
they may contact Georgeson toll-free at 800-366-2167. Any proxy given by a
stockholder is revocable until voted at the Meeting.
See "Proxy Statement -- General."
In the event that sufficient votes in favor of the proposal set forth in the
Notice of this Meeting are not received by July 7, 2004, the persons named as
appointed proxies on the enclosed proxy card may propose one or more
adjournments of the Meeting to permit further solicitation of proxies. Any such
adjournment will require the affirmative vote of a majority of the votes cast on
the matter at the session of the meeting to be adjourned. The persons named as
appointed proxies on the enclosed proxy card will vote in favor of such
adjournment those proxies which they are entitled to vote in favor of the
proposal for which further solicitation of proxies is to be made. They will vote
against any such adjournment those proxies required to be voted against such
proposal. The costs of any such additional solicitation and of any adjourned
session will be borne by the Fund.
17
Stockholder Proposals
Stockholders wishing to submit proposals for inclusion in the Fund's proxy
statement for the 2005 meeting of stockholders of the Fund should send their
written proposals to John Millette, Secretary of the Fund, c/o Deutsche
Investment Management Americas Inc. at 345 Park Avenue, New York, New York
10154, by January 25, 2005. The timely submission of a proposal does not
guarantee its inclusion.
For nominations of candidates for election as Directors (other than nominations
made by or at the recommendation of the Directors) or other business to be
properly brought before the annual meeting by a stockholder, the stockholder
must comply with the Fund's bylaws, which, among other things, require that the
stockholder must give timely notice in writing to the Secretary of the Fund, the
stockholder must be a stockholder of record and the notice must contain the
information about the nomination or other business that is required by the
Fund's bylaws. To be timely, any such notice must be delivered to or mailed by
certified mail, return receipt requested, and received at the principal
executive offices of the Fund not later than 90 days nor more than 120 days
prior to the date of the meeting; provided, however, that if less than 100 days'
notice or prior public disclosure is given or made to stockholders, any such
notice by a stockholder to be timely must be so received not later than the
close of business on the 10th day following the earlier of the day on which such
notice of the date of the annual or special meeting was given or such public
disclosure was made.
The Fund may exercise discretionary voting authority with respect to stockholder
proposals for the 2005 meeting of stockholders which are not included in the
proxy statement and form of proxy, if notice of such proposals is not received
by the Fund at the above address within the timeframe indicated above. Even if
timely notice is received, the Fund may exercise discretionary voting authority
in certain other circumstances. Discretionary voting authority is the power to
vote proxies that stockholders have executed and returned to the Fund on matters
not specifically reflected on the form of proxy.
By order of the Board of Directors,
/s/John Millette
John Millette
Secretary
345 Park Avenue
New York, New York 10154
May 25, 2004
18
APPENDIX A
The Brazil Fund, Inc.
AUDIT COMMITTEE CHARTER
ADOPTED APRIL 7, 2004
This document constitutes the Charter of the Audit Committee (the "Committee")
of the Board of Directors of The Brazil Fund, Inc. (the "Fund"). The Board of
Directors of the Fund (the "Board") established the Committee to provide
oversight with respect to the Fund's accounting and financial reporting policies
and practices.
(1) Organization. The Committee shall be composed of three or more members of
the Board who are not "interested persons" (as defined in the Investment
Company Act of 1940) of the Fund, who do not directly or indirectly receive
consulting, advisory or other compensatory fees from the Fund or from the
Fund's investment adviser or its affiliates, except fees from the Fund for
services as a Director, and who satisfy any independence or expertise
requirements of the exchange(s) on which the Fund's shares are traded.
(2) Meetings. The Committee shall meet on a regular basis as necessary or
appropriate, and is empowered to hold special meetings as circumstances
warrant.
(3) Committee Purposes. The purposes of the Committee are as follows:
(a) To oversee the Fund's accounting and financial reporting policies and
practices, the Fund's internal controls (including disclosure controls
and procedures) and, as appropriate, the internal controls of certain
Fund service providers;
(b) To oversee the quality and objectivity of the Fund's financial
statements and the independent audit thereof;
(c) To exercise direct responsibility for the appointment, compensation,
retention and oversight of the work performed by the Fund's
independent auditors for the purpose of preparing or issuing an audit
report or performing other audit, review or attest services for the
Fund;
(d) To act as a liaison between the Fund's independent auditors and the
Board;
(e) To oversee the Fund's compliance with legal and regulatory
requirements; and
(f) To prepare an audit committee report as required by Item 306 of
Regulation S-K to be included in the Fund's annual proxy statement
relating to the election of directors, or, if the Fund does not file a
proxy statement, in the Fund's annual report filed with the Securities
and Exchange Commission.
The function of the Audit Committee is oversight; it is management's
responsibility to maintain or arrange for the maintenance of appropriate systems
for accounting and internal controls (including disclosure controls and
procedures), and the auditor's responsibility to plan and carry out a proper
audit.
19
(4) Duties and Powers. To carry out the purposes specified in Paragraph 3
above, the Committee shall have the following duties and powers:
(a) To approve the selection, retention, compensation and termination of
the Fund's independent auditors, and, in connection therewith, to
evaluate and determine the terms of any engagement of the auditors
(including fees) by or on behalf of the Fund, as well as to set clear
hiring policies relating to the hiring by entities within the Fund's
investment complex^1 of employees or former employees of the
independent auditors;
(b) To consider whether the provision of non-audit services rendered by
the independent auditors to the Fund and the Fund's investment adviser
and its affiliates, or any other circumstances which may arise, impair
the independence of independent auditors;
(c) To: (i) at least annually, obtain and review a report by the
independent auditor describing: the firm's internal quality-control
procedures; any material issues raised by the most recent internal
quality-control review, or peer review, of the firm, or by any inquiry
or investigation by governmental or professional authorities, within
the preceding five years, respecting one or more independent audits
carried out by the firm, and any steps taken to deal with any such
issues; and (to assess the auditor's independence) all relationships
between the independent auditor and the Funds; (ii) discuss the annual
audited financial statements and any interim financial statements with
management and the independent auditor, including the Fund's
disclosures under "Portfolio Management Review"; and (iii) discuss
policies with respect to risk assessment and risk management;
(d) To meet with the Fund's independent auditors, including private
meetings as necessary or appropriate: (i) to review the arrangements
for and scope of the Fund's annual audit and any special audits; (ii)
to discuss any matters of concern relating to the Fund's financial
statements, including any adjustments to such statements recommended
by the auditors, regulatory and tax compliance matters considered in
the preparation of the financial statements, or other results of said
audit(s); (iii) to consider the auditors' comments with respect to the
Fund's financial policies and procedures, internal accounting controls
and disclosure controls and procedures, and management's responses
thereto; (iv) to review the form of the opinion the auditors propose
to render to the Board and Fund stockholders; and (v) to review any
other reports, representations or communications from the auditors
regarding matters within the Committee's scope of responsibilities
under this Charter;
----------------------------------
^1 "Investment company complex" includes:
-- the Fund and its investment adviser or sponsor;
-- any entity controlling, controlled by or under common control with the
investment adviser or sponsor, if the entity (i) is an investment adviser
or sponsor or (ii) is engaged in the business of providing administrative,
custodian, underwriting or transfer agent services to any investment
company, investment adviser or sponsor; and
-- any investment company, hedge fund or unregistered fund that has an
investment adviser included in the definition set forth in either of the
sections above.
20
(e) To meet regularly with the Fund's chief financial and accounting
officers, the Fund's Treasurer and the Fund's investment adviser's
internal auditors, in each case to discuss any matters the Committee
or such parties believe necessary or appropriate to raise, and to
review and consider any reports or communications from any such
parties relating to the operations of the Fund;
(f) To review such other matters or information that the Committee
believes may be relevant to the auditors, the audit engagement, or the
Fund's financial policies and procedures, internal accounting controls
or disclosure controls and procedures;
(g) To establish procedures for the receipt, retention and treatment of
complaints that the Fund receives regarding Fund accounting, internal
accounting controls or auditing matters, and for the confidential,
anonymous submissions by Fund officers or employees of Fund service
providers of concerns regarding suspected fraud of any type related to
the Fund, including without limitation questionable accounting or
auditing matters;
(h) To establish procedures for the prospective approval of the engagement
of the independent auditors to provide: (i) audit or permissible
non-audit services to the Fund, and (ii) non-audit services to the
Fund's investment advisers (or any entity controlling, controlled by
or under common control with a Fund investment adviser that provides
ongoing services to the Fund) that relate directly to the Fund's
operations and financial reporting;
(i) To establish guidelines pursuant to which the independent auditors are
required to keep the Committee apprised of any proposed new
relationships between the independent auditors and the Fund's
investment advisers (and their affiliates); and
(j) To report its activities to the Board on a regular basis and to make
such recommendations with respect to the above and other matters as
the Committee may deem necessary or appropriate.
(5) Role of Independent Auditors. The Fund's independent auditors are
ultimately accountable to the Committee, and must report directly to the
Committee.
(6) Resources and Authority. The Committee shall have the resources and
authority necessary or appropriate for purposes of discharging its
responsibilities under this Charter, including the authority to consult
with counsel and/or to retain, at the Fund's expense, such other experts or
consultants as the Committee deems necessary or appropriate to fulfill its
responsibilities.
(7) Periodic Review of C harter. The Committee shall review this Charter at
least annually and recommend any changes to the Board.
21
APPENDIX B
The Brazil Fund, Inc.
COMMITTEE ON INDEPENDENT DIRECTORS
CHARTER
ADOPTED APRIL 7, 2004
This document constitutes the Charter of the Committee on Independent
Directors (the "Committee") of the Board of Directors of The Brazil Fund, Inc.
(the "Fund"). The Board of Directors of the Fund (the "Board") has adopted this
Charter to govern the activities of the Committee.
(1) Statement of Purposes and Responsibilities. The primary purposes and
responsibilities of the Committee are: (i) to identify individuals
qualified to become members of the Board in the event that a position is
vacated or created; (ii) to recommend for the Board's selection the
Director nominees for the next annual meeting of stockholders; (iii) to set
any necessary standards or qualifications for service on the Board; (iv) to
review and evaluate the compensation practices of the Directors who are not
"interested persons" of the Fund, as defined in Section 2(a)(19) of the
Investment Company Act of 1940, as amended ("Independent Directors"), and
to recommend any changes thereto to the Board; (v) to determine the
policies governing retirement of all Independent Directors; (vi) to perform
periodic evaluations of the effectiveness of the Independent Directors; and
(vii) to consider such other matters of special relevance to Independent
Directors.
(2) Organization and Governance. The Committee shall be comprised of all of the
Independent Directors and shall not include any members who are not
Independent Directors.
A member of the Committee may be designated by the Board as the Committee's
chair (the "Lead Independent Director"). The Committee may delegate any portion
of its authority or responsibilities to a sub-committee of one or more members.
The Committee will not have regularly scheduled meetings. Committee meetings
shall be held as and when the Committee or the Board determines necessary or
appropriate in accordance with the Fund's By-Laws. The Chair of the Board, the
Lead Independent Director or a majority of the members of the Committee are
authorized to call a meeting of the Committee and send notice thereof.
A majority of the members of the Committee shall constitute a quorum for the
transaction of business at any meeting of the Committee. The action of a
majority of the members of the Committee present at a meeting at which a quorum
is present shall be the action of the Committee. The Committee may also take
action by written consent of a majority of the Committee members. The Committee
may meet by means of a telephone conference circuit or similar communications
equipment by means of which all persons participating in the meeting can hear
each other.
22
(3) Qualifications for Director Nominees. The Committee requires that Director
candidates have a college degree or equivalent business experience. The
Committee may take into account a wide variety of factors in considering
Director candidates, 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 candidate's ability, judgment and expertise and (v)
overall diversity of the Board's composition.
(4) Identification of Nominees. In identifying potential nominees for the
Board, the Committee may consider candidates recommended by one or more of
the following sources: (i) the Fund's current Directors, (ii) the Fund's
officers, (ii) the Fund's investment adviser(s), (iv) the Fund's
stockholders (see below) and (v) any other source the Committee deems to be
appropriate. The Committee may, but is not required to, retain a third
party search firm at the Fund's expense to identify potential candidates.
(5) Consideration of Candidates Recommended By Stockholders. The Committee will
consider and evaluate nominee candidates properly submitted by stockholders
on the same basis as it considers and evaluates candidates recommended by
other sources. Appendix A to this Charter, as it may be amended from time
to time by the Committee, sets forth procedures that must be followed by
stockholders to properly submit a nominee candidate to the Committee
(recommendations not properly submitted in accordance with Appendix A will
not be considered by the Committee).
23
Appendix A to Committee on Independent Directors Charter
Procedures for Stockholders to Submit Nominee Candidates
Adopted April 7, 2004
A Fund stockholder must follow the following procedures in order to properly
submit a nominee recommendation for the Committee's consideration.
(1) The stockholder must submit any such recommendation (a "Stockholder
Recommendation") in writing to the relevant Fund, to the attention of the
Secretary, at the address of the principal executive offices of the Fund.
(2) Stockholder Recommendations must be delivered to, or mailed by certified
mail, return receipt requested to and received at, the principal executive
offices of the Fund at least 120 calendar days before the anniversary of
the date that the Fund's proxy statement was released to stockholders in
connection with the previous year's annual meeting.
(3) The Stockholder Recommendation must include:
(a) a statement in writing setting forth (i) the name, age, date of birth,
business address, residence address, principal occupation or
employment, and nationality of the person recommended by the
stockholder (the "candidate"); (ii) the class or series and number of
all shares of the Fund owned of record or beneficially by the
candidate, as reported to such stockholder by the candidate; (iii) any
other information regarding the candidate called for with respect to
director nominees by paragraphs (a), (d), (e) and (f) of Item 401 of
Regulation S-K or paragraph (b) of Item 22 of Rule 14a-101 (Schedule
14A) under the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), adopted by the Securities and Exchange Commission (or
the corresponding provisions of any regulation or rule subsequently
adopted by the Securities and Exchange Commission or any successor
agency applicable to the Fund); (iv) any other information regarding
the candidate that would be required to be disclosed if the candidate
were a nominee in a proxy statement or other filing required to be
made in connection with solicitation of proxies for election of
directors pursuant to Section 14 of the Exchange Act and the rules and
regulations promulgated thereunder; and (v) whether the recommending
stockholder believes that the candidate is or will be an "interested
person" of the Fund (as defined in the Investment Company Act of 1940,
as amended) and, if not an "interested person," information regarding
the candidate that will be sufficient for the Fund to make such
determination;
(b) the written and signed consent of the candidate to be named as a
nominee and to serve as a Director if elected;
(c) the recommending stockholder's name and address as they appear on the
Fund's books;
(d) the class or series and number of all shares of the Fund owned
beneficially and of record by the recommending stockholder; and
(e) a description of all arrangements or understandings between the
recommending stockholder and the candidate and any other person or
persons (including their names) pursuant to which the recommendation
is being made by the recommending stockholder. In addition, the
Committee may require the candidate to furnish such other information
as it may reasonably require or deem necessary to determine the
eligibility of such candidate to serve on the Board.
24
Please fold and detach card at perforation before mailing.
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PROXY THE BRAZIL FUND, INC. PROXY
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
Annual Meeting of Stockholders -- July 7, 2004
The undersigned hereby appoints Bruce Rosenblum, John Millette and Caroline
Pearson, and each of them, the proxies of the undersigned, with full power of
substitution in each of them, to represent the undersigned and to vote all
shares of The Brazil Fund, Inc. which the undersigned is entitled to vote at the
Annual Meeting of Stockholders of The Brazil Fund, Inc. to be held at the
offices of Deutsche Investment Management Americas Inc., part of Deutsche Asset
Management, 29th Floor, East Side, 280 Park Avenue (at 48th - 49th Streets), New
York, New York 10017, on Wednesday, July 7, 2004 at 10:45 a.m., Eastern time,
and at any adjournment or postponement thereof. The undersigned acknowledges
receipt of the Notice of Annual Meeting of Stockholders and accompanying Proxy
Statement and revokes any proxy previously given with respect to the meeting.
(continued on other side)
Instructions for Voting Your Proxy
The Brazil Fund offers stockholders of record three alternative ways of
authorizing proxies to vote their shares:
o By Telephone
o Through the Internet (using a browser)
o By Mail (traditional method)
Your telephone or Internet instructions authorize the named proxies to vote your
shares in the same manner as if you had mailed your proxy card. We encourage you
to use these cost effective and convenient ways of voting.
---------
TELEPHONE Available only until 4:00 p.m. Eastern time on July 6, 2004.
---------
o Call TOLL-FREE: 1-800-732-6583 on any touch-tone telephone to authorize
voting of your shares. You may call 24 hours a day, 7 days a week. You will
be prompted to follow simple instructions.
o Your voting instructions will be confirmed and shares voted as you
directed.
--------
INTERNET Available only until 4:00 p.m. Eastern time on July 6, 2004.
--------
o Visit the Internet voting Website at http://proxy.georgeson.com
o Enter the COMPANY NUMBER AND CONTROL NUMBER shown below and follow the
instructions on your screen.
o Your voting instructions will be confirmed and shares voted as you
directed.
o You will incur only your usual Internet charges.
-------
BY MAIL
-------
o Simply sign and date your proxy card and return it in the postage-paid
envelope.
-------------- --------------
COMPANY NUMBER CONTROL NUMBER
-------------- --------------
Please fold and detach card at perforation before mailing.
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To vote, mark blocks below in
blue or black ink as follows: X
Unless otherwise specified in the squares provided, the
undersigned's vote will be cast FOR the item listed
FOR all nominees listed WITHHOLD AUTHORITY
The election of three Directors: at left (except as marked to vote for all nominees
to the contrary at left) listed at left
Nominees: Class III: Vincent J. Esposito,
Ronaldo A. da Frota Nogueira and Susan Kaufman Purcell /_____/ /_____/
(INSTRUCTION: To withhold authority to vote for any
individual nominee, write that nominee's name on the
space provided below.)
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The Proxies are authorized to vote in their discretion Please sign exactly as your name or names appear. When
on any other business which may properly come before the signing as attorney, executor, administrator, trustee
meeting and any adjournments or postponements thereof. or guardian, please give your full title as such.
-----------------------------------------------
(Signature of Stockholder)
-----------------------------------------------
(Signature of joint owner, if any)
Date ___________________________________ , 2004
PLEASE SIGN AND RETURN PROMPTLY IN ENCLOSED
ENVELOPE. NO POSTAGE IS REQUIRED.