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<SEC-DOCUMENT>0000950137-05-010956.txt : 20050901
<SEC-HEADER>0000950137-05-010956.hdr.sgml : 20050901
<ACCEPTANCE-DATETIME>20050901152842
ACCESSION NUMBER:		0000950137-05-010956
CONFORMED SUBMISSION TYPE:	N-2
PUBLIC DOCUMENT COUNT:		2
FILED AS OF DATE:		20050901
DATE AS OF CHANGE:		20050901

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			MEXICO EQUITY & INCOME FUND INC
		CENTRAL INDEX KEY:			0000863900
		IRS NUMBER:				133576061
		STATE OF INCORPORATION:			MD
		FISCAL YEAR END:			0731

	FILING VALUES:
		FORM TYPE:		N-2
		SEC ACT:		1933 Act
		SEC FILE NUMBER:	333-128040
		FILM NUMBER:		051064738

	BUSINESS ADDRESS:	
		STREET 1:		U.S. BANCORP FUND SERVICES, LLC
		STREET 2:		615 EAST MICHIGAN STREET, LC-2
		CITY:			MILWAUKEE
		STATE:			WI
		ZIP:			53202
		BUSINESS PHONE:		4147654499

	MAIL ADDRESS:	
		STREET 1:		U.S. BANCORP FUND SERVICES, LLC
		STREET 2:		615 EAST MICHIGAN STREET, LC-2
		CITY:			MILWAUKEE
		STATE:			WI
		ZIP:			53202

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	MEXICO CONVERTIBLE ADVANTAGE FUND INC
		DATE OF NAME CHANGE:	19900807

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	MEXICO ADVANTAGE FUND INC
		DATE OF NAME CHANGE:	19900805
</SEC-HEADER>
<DOCUMENT>
<TYPE>N-2
<SEQUENCE>1
<FILENAME>c98194nv2.htm
<DESCRIPTION>REGISTRATION STATEMENT
<TEXT>
<HTML>
<HEAD>
<TITLE>nv2</TITLE>
</HEAD>
<BODY bgcolor="#FFFFFF">
<!-- PAGEBREAK -->
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">



<DIV align="right" style="font-size: 10pt; margin-top: 12pt"><B>As filed with the Securities and Exchange Commission on September&nbsp;1, 2005<BR>
1933 Act File No.&nbsp;333-_______</B>
</DIV>


<DIV style="width: 100%; border-bottom: 2pt solid black; font-size: 1pt">&nbsp;</DIV>
<DIV style="width: 100%; border-bottom: 1pt solid black; font-size: 1pt">&nbsp;</DIV>






<DIV align="center" style="font-size: 14pt; margin-top: 12pt"><B>U.S. SECURITIES AND EXCHANGE COMMISSION</B>
</DIV>

<DIV align="center" style="font-size: 12pt"><B>WASHINGTON, D.C. 20549</B>
</DIV>

<DIV align="center" style="font-size: 10pt"><DIV align="center"><DIV style="font-size: 3pt; margin-top: 16pt; width: 26%; border-top: 1px solid #000000">&nbsp;</DIV></DIV></DIV>


<DIV align="center" style="font-size: 18pt; margin-top: 12pt"><B>FORM N-2</B>
</DIV>


<DIV align="center" style="font-size: 12pt; margin-top: 18pt"><FONT face="Wingdings">&#254;</FONT> REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933<BR>
<FONT face="Wingdings">&#111;</FONT> PRE-EFFECTIVE AMENDMENT NO. <U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U><BR>
<FONT face="Wingdings">&#111;</FONT> POST-EFFECTIVE AMENDMENT NO. <U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U>
</DIV>

<DIV align="center" style="font-size: 24pt; margin-top: 12pt"><B>THE MEXICO EQUITY &#038; INCOME FUND, INC.</B>
</DIV>

<DIV align="center" style="font-size: 10pt">(Exact Name of Registrant as Specified in Charter)</DIV>


<DIV align="center" style="font-size: 10pt">615 East Michigan St., 2<SUP style="font-size: 85%; vertical-align: text-top">nd</SUP> Floor</DIV>


<DIV align="center" style="font-size: 10pt">Milwaukee, WI 53202</DIV>


<DIV align="center" style="font-size: 10pt">(Address of Principal Executive Offices)</DIV>


<DIV align="center" style="font-size: 10pt">Registrant&#146;s Telephone Number, including Area Code: (888)&nbsp;294-8217</DIV>



<DIV align="center" style="font-size: 10pt; margin-top: 18pt">The Mexico Equity &#038; Income Fund, Inc.<BR>
615 East Michigan St., 2<SUP style="font-size: 85%; vertical-align: text-top">nd</SUP> Floor<BR>
Milwaukee, WI 53202<BR>
(Name and Address of Agent for Service)<BR>
Copies of information to:
</DIV>


<DIV align="center" style="font-size: 10pt; margin-top: 18pt">Thomas R. Westle, Esq.<BR>
Rustin I. Paul, Esq.<BR>
Blank Rome LLP<BR>
405 Lexington Avenue<BR>
New York, NY 10174<BR>
(212)&nbsp;885-5239
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><B>Approximate Date of Proposed Public Offering: </B>As soon as practicable after the effective date of
this Registration Statement.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">If any securities being registered on this form will be offered on a delayed or continuous basis in
reliance on Rule&nbsp;415 under the Securities Act of 1933, other than securities offered in connection
with a dividend reinvestment plan, check the following box. <FONT face="Wingdings">&#111;</FONT>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">It is proposed that this filing will become effective (check appropriate box):
</DIV>

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="96%">&nbsp;</TD>
</TR>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px"><FONT face="Wingdings">&#254;</FONT>
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">when declared effective pursuant to section 8(c).</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">If appropriate, check the following box:
</DIV>

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="96%">&nbsp;</TD>
</TR>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px"><FONT face="Wingdings">&#111;</FONT>
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">This post-effective amendment designates a new effective date for a previously filed
post-effective amendment registration statement.</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px"><FONT face="Wingdings">&#111;</FONT>
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">This form is filed to register additional securities for an offering pursuant to Rule&nbsp;462(b)
under the Securities Act and the Securities Act registration statement number of the earlier
effective registration statement for the same offering is <U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U>.</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>CALCULATION OF REGISTRATION FEE UNDER THE SECURITIES ACT OF 1933</B>
</DIV>

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="1%">&nbsp;</TD>
    <TD width="54%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD><!-- VRule -->
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD><!-- VRule -->
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD><!-- VRule -->
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD><!-- VRule -->
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>

    <TD width="1%">&nbsp;</TD>
</TR><TR style="font-size: 1px" valign="bottom">
    <TD nowrap align="left" colspan="23" style="border-bottom: 3px solid #000000">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">    <TD width="1%">&nbsp;</TD>

    <TD>&nbsp;</TD>
    <TD style="border-right: 2px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD style="border-right: 2px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD style="border-right: 2px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">Proposed</TD>
    <TD>&nbsp;</TD>
    <TD style="border-right: 2px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">    <TD width="1%">&nbsp;</TD>

    <TD>&nbsp;</TD>
    <TD style="border-right: 2px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">Amount of</TD>
    <TD>&nbsp;</TD>
    <TD style="border-right: 2px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">Proposed</TD>
    <TD>&nbsp;</TD>
    <TD style="border-right: 2px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">Maximum</TD>
    <TD>&nbsp;</TD>
    <TD style="border-right: 2px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">    <TD width="1%">&nbsp;</TD>

    <TD>&nbsp;</TD>
    <TD style="border-right: 2px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">Rights/Shares</TD>
    <TD>&nbsp;</TD>
    <TD style="border-right: 2px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">Maximum</TD>
    <TD>&nbsp;</TD>
    <TD style="border-right: 2px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">Aggregate</TD>
    <TD>&nbsp;</TD>
    <TD style="border-right: 2px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">Amount of</TD>
    <TD>&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">    <TD width="1%">&nbsp;</TD>

    <TD>&nbsp;</TD>
    <TD style="border-right: 2px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">Being</TD>
    <TD>&nbsp;</TD>
    <TD style="border-right: 2px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">Offering Price</TD>
    <TD>&nbsp;</TD>
    <TD style="border-right: 2px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">Offering</TD>
    <TD>&nbsp;</TD>
    <TD style="border-right: 2px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">Registration</TD>
    <TD>&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">    <TD width="1%">&nbsp;</TD>

    <TD nowrap align="center">Title of Securities Being Registered</TD>
    <TD style="border-right: 2px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">Registered</TD>
    <TD>&nbsp;</TD>
    <TD style="border-right: 2px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">Per Share (3)</TD>
    <TD>&nbsp;</TD>
    <TD style="border-right: 2px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">Price (3)</TD>
    <TD>&nbsp;</TD>
    <TD style="border-right: 2px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">Fee (4)</TD>
    <TD>&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD width="1%" style="border-top: 2px solid #000000">&nbsp;</TD>
                    <TD style="border-top: 2px solid #000000"><DIV style="margin-left:15px; text-indent:-15px">Rights to Purchase Preference
Common Stock (1)</DIV></TD>
    <TD style="border-right: 2px solid #000000; border-top: 2px solid #000000">&nbsp;</TD>
    <TD style="border-top: 2px solid #000000">&nbsp;</TD>
    <TD nowrap align="left" style="border-top: 2px solid #000000">&nbsp;</TD>
    <TD align="right" style="border-top: 2px solid #000000">1,855,128</TD>
    <TD nowrap style="border-top: 2px solid #000000">(2)</TD>
    <TD style="border-right: 2px solid #000000; border-top: 2px solid #000000">&nbsp;</TD>
    <TD style="border-top: 2px solid #000000">&nbsp;</TD>
    <TD style="border-top: 2px solid #000000">&nbsp;</TD>
    <TD colspan="2" align="right" style="border-top: 2px solid #000000; border-top: 2px solid #000000">0.00</TD>

    <TD style="border-right: 2px solid #000000; border-top: 2px solid #000000">&nbsp;</TD>
    <TD style="border-top: 2px solid #000000">&nbsp;</TD>
    <TD style="border-top: 2px solid #000000">&nbsp;</TD>

<TD colspan="2" align="right" style="border-top: 2px solid #000000; border-top: 2px solid #000000">0.00&nbsp;</TD>
    <TD style="border-right: 2px solid #000000; border-top: 2px solid #000000">&nbsp;</TD>
    <TD style="border-top: 2px solid #000000">&nbsp;</TD>
    <TD style="border-top: 2px solid #000000">&nbsp;</TD>

<TD colspan="2" align="right" style="border-top: 2px solid #000000; border-top: 2px solid #000000">0.00&nbsp;</TD>

    <TD width="1%" style="border-top: 2px solid #000000">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD width="1%" style="border-top: 2px solid #000000">&nbsp;</TD>
    <TD style="border-top: 2px solid #000000"><DIV style="margin-left:15px; text-indent:-15px">Preference Common Stock</DIV></TD>
    <TD style="border-right: 2px solid #000000; border-top: 2px solid #000000">&nbsp;</TD>
    <TD style="border-top: 2px solid #000000">&nbsp;</TD>
    <TD style="border-top: 2px solid #000000">&nbsp;</TD>
    <TD align="right" style="border-top: 2px solid #000000">1,855,128</TD>
    <TD style="border-top: 2px solid #000000">&nbsp;</TD>
    <TD style="border-right: 2px solid #000000; border-top: 2px solid #000000">&nbsp;</TD>
    <TD style="border-top: 2px solid #000000">&nbsp;</TD>
    <TD style="border-top: 2px solid #000000">&nbsp;</TD>
    <TD colspan="2" align="right" style="border-top: 2px solid #000000">&#091;$17.94&#093;</TD>

    <TD style="border-right: 2px solid #000000; border-top: 2px solid #000000">&nbsp;</TD>
    <TD style="border-top: 2px solid #000000">&nbsp;</TD>
    <TD style="border-top: 2px solid #000000">&nbsp;</TD>
    <TD colspan="2" align="right" style="border-top: 2px solid #000000">&#091;$33,280,996.32&#093;</TD>

    <TD style="border-right: 2px solid #000000; border-top: 2px solid #000000">&nbsp;</TD>
    <TD style="border-top: 2px solid #000000">&nbsp;</TD>
    <TD style="border-top: 2px solid #000000">&nbsp;</TD>
    <TD colspan="2" align="right" style="border-top: 2px solid #000000">&#091;$3,917.17&#093;</TD>

    <TD width="1%" style="border-top: 2px solid #000000">&nbsp;</TD>
</TR>
<TR style="font-size: 1px" valign="bottom">
    <TD nowrap align="left" colspan="23" style="border-top: 3px solid #000000">&nbsp;</TD>
</TR>

<!-- End Table Body -->
</TABLE>
</DIV>


<DIV align="left">
<DIV style="font-size: 3pt; margin-top: 16pt; width: 18%; border-top: 1px solid #000000">&nbsp;</DIV>
</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">
<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96"></TD>
</TR>

<TR valign="top">
    <TD nowrap align="left">(1)</TD>
    <TD>&nbsp;</TD>
    <TD>Evidencing the rights to subscribe for shares of Preference Common Stock of the
Registrant being registered herewith. Pursuant to Rule 457(g) of the Securities Act of
1933, no separate registration fee is required for the rights because the rights are being
registered in the same registration statement as the Preference Common Stock of the
Registrant underlying the rights.</TD>
</TR>

<TR style="font-size: 3pt"><TD>&nbsp;</TD></TR>

<TR valign="top">
    <TD nowrap align="left">(2)</TD>
    <TD>&nbsp;</TD>
    <TD>Represents 0.75 Subscription Rights for each share of common stock of Registrant
outstanding as of the Record Date.</TD>
</TR>

<TR style="font-size: 3pt"><TD>&nbsp;</TD></TR>

<TR valign="top">
    <TD nowrap align="left">(3)</TD>
    <TD>&nbsp;</TD>
    <TD>Estimated solely for the purpose of calculating the registration fee. Based on the
average high and low prices reported on the New York Stock Exchange on August&nbsp;30, 2005
(i.e., a specified date within 5 business days prior to the date of filing of this
registration statement).</TD>
</TR>

<TR style="font-size: 3pt"><TD>&nbsp;</TD></TR>

<TR valign="top">
    <TD nowrap align="left">(4)</TD>
    <TD>&nbsp;</TD>
    <TD>Calculated in accordance with Rule 457(c) of the Securities Act of 1933, as amended,
based on the estimated maximum aggregate offering price of the common stock of the
Registrant.</TD>
</TR>

</TABLE>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">WE HEREBY AMEND THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES AS MAY BE NECESSARY TO DELAY ITS
EFFECTIVE DATE UNTIL WE SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS
REGISTRATION STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF THE
SECURITIES ACT OF 1933, AS AMENDED, OR UNTIL THIS REGISTRATION STATEMENT SHALL BECOME EFFECTIVE ON
SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SECTION 8(a), MAY DETERMINE.
</DIV>


<DIV style="width: 100%; border-bottom: 1pt solid black; margin-top: 10pt; font-size: 1pt">&nbsp;</DIV>
<DIV style="width: 100%; border-bottom: 2pt solid black; font-size: 1pt">&nbsp;</DIV>





<P align="center" style="font-size: 10pt">&nbsp;
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">








<DIV align="center" style="font-size: 10pt; margin-top: 18pt">The Mexico Equity &#038; Income Fund, Inc.
</DIV>


<DIV align="center" style="font-size: 10pt; margin-top: 6pt">Cross Reference Sheet
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt">PART A &#151; INFORMATION REQUIRED IN A PROSPECTUS
</DIV>

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="5%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="40%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="40%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD nowrap align="center" style="border-bottom: 1px solid #000000">No.</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" style="border-bottom: 1px solid #000000">Description</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" style="border-bottom: 1px solid #000000">Location</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Item&nbsp;1.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Outside Front Cover
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Outside Front Cover</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Item&nbsp;2.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Cover Pages; Other Offering Information
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Inside Front and Outside Back Cover</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Item&nbsp;3.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Fee Table and Synopsis
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Fees and Expenses</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Item&nbsp;4.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Financial Highlights
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Financial Highlights</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Item&nbsp;5.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Plan of Distribution
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Outside Front Cover; Prospectus
Summary</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Item&nbsp;6.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Selling Stockholders
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Not Applicable</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Item&nbsp;7.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Use of Proceeds
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Use of Proceeds</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Item&nbsp;8.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">General Description of the Registrant
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Outside Front Cover Page;
Prospectus Summary; Risk Factors;
Business of the Fund</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Item&nbsp;9.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Management
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Management</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Item&nbsp;10.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Capital Stock, Long-Term Debt and Other Securities
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Description of our Capital Stock</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Item&nbsp;11.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Defaults and Arrears on Senior Securities
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Not Applicable</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Item&nbsp;12.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Legal Proceedings
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Legal Proceedings</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Item&nbsp;13.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Table of Contents of the Statement of Additional
Information
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Not Applicable</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt">PART B &#151; INFORMATION REQUIRED IN A STATEMENT OF ADDITIONAL INFORMATION<SUP style="font-size: 85%; vertical-align: text-top"> *</SUP>
</DIV>

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="5%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="40%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="40%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD nowrap align="center" style="border-bottom: 1px solid #000000">No.</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" style="border-bottom: 1px solid #000000">Description</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" style="border-bottom: 1px solid #000000">Location</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Item&nbsp;14.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Cover Page
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Outside Front Cover</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Item&nbsp;15.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Table of Contents
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Table of Contents</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Item&nbsp;16.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">General Information and History
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Prospectus Summary;
Business of the
Fund</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Item&nbsp;17.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Investment Objective and Policies
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Prospectus Summary;
Investment
Objective and
Policies; Risk
Factors; Business
of the Fund</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Item&nbsp;18.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Management
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Management</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Item&nbsp;19.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Control Persons and Principal Holders of Securities
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Control Persons and
Principal
Stockholders</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Item&nbsp;20.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Investment Advisory and Other Services
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Prospectus Summary;
Business of the
Fund; Investment
Advisory Agreement</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Item&nbsp;21.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Portfolio Managers
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Prospectus Summary;
Business of the
Fund; Investment
Advisory Agreement</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Item&nbsp;22.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Brokerage Allocation and Other Practices
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Fees and Expenses;
Prospectus Summary;
Brokerage
Allocation and
Other Practices</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Item&nbsp;23.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Tax Status
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Distributions;
Material United
States Federal
Income Tax
Consequences</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Item&nbsp;24.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Financial Statements
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Financial Statements</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt">PART C &#151; OTHER INFORMATION
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">Information required to be included in Part&nbsp;C is set forth under the appropriate item, so numbered,
in Part&nbsp;C of this Registration Statement.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt; margin-left:10px; text-indent:-10px">* PURSUANT TO THE GENERAL INSTRUCTIONS TO FORM N-2, ALL INFORMATION REQUIRED TO BE SET FORTH IN
PART B &#147;STATEMENT OF ADDITIONAL INFORMATION&#148; HAS BEEN INCLUDED IN THE PROSPECTUS AND, ACCORDINGLY,
NO STATEMENT OF ADDITIONAL INFORMATION HAS BEEN FILED AS PART OF THIS REGISTRATION STATEMENT.<BR>
</DIV>


<P align="center" style="font-size: 10pt">2
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">



<DIV align="left" style="font-size: 10pt; margin-top: 6pt">THE INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED. WE MAY NOT ISSUE THESE
SECURITIES UNTIL THE REGISTRATION STATEMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION IS
EFFECTIVE. THIS PROSPECTUS IS NOT AN OFFER TO SELL OR ISSUE THESE SECURITIES AND IS NOT SOLICITING
AN OFFER TO PURCHASE OR ACCEPT THESE SECURITIES IN ANY STATE WHERE THE OFFER OR SALE IS NOT
PERMITTED.
</DIV>
<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;</DIV>

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="30%"></TD>
    <TD width="5%"></TD>
    <TD width="30%"></TD>
    <TD width="5%"></TD>
    <TD width="30%"></TD>
</TR>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD align="left" valign="top">PRELIMINARY PROSPECTUS
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">SUBJECT TO COMPLETION
</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">September&nbsp;1, 2005</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>1,855,128 Shares Issuable Upon Exercise of Rights to Purchase Preference Common Stock</B>
</DIV>


<DIV align="left" style="font-size: 12pt; margin-top: 6pt"><B>The Mexico Equity &#038; Income Fund, Inc.</B>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">Each of our stockholders as of &#091;&#95;&#95;&#95;, 2005&#093; (the &#147;Record Date&#148;) shall receive, at no
cost, 0.75 nontransferable rights (each whole right, a &#147;Subscription Right&#148;) to purchase one share
of Preference Common Stock (&#147;Preference Stock&#148;) for each share of our common stock such stockholder
owns as of the Record Date (the &#147;Primary Right&#148;). We will not issue fractional shares upon the
exercise of your Primary Right or Over-Subscription Privilege (as defined below). We intend to
offer shares of Preference Stock to these stockholders for a price equal to the greater of (a)&nbsp;90%
of the Fund&#146;s net asset value per share (&#147;NAV&#148;) as determined on the Expiration Date (as defined
below) or (b)&nbsp;the average closing price of our common stock over the four consecutive trading days
ending on the Expiration Date. The offer to purchase Preference Stock will expire at 5:00 p.m., New
York City time, on &#091;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#093;, 2005, unless we decide to extend it to some later date (the
&#147;Expiration Date&#148;).
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">If you elect to purchase the maximum amount of our Preference Stock that you are entitled to
pursuant to your Primary Right, you will also be entitled to subscribe, subject to allotment, to
purchase additional shares of our Preference Stock, if any, that are not purchased by our other
stockholders pursuant to their Primary Right as of the Expiration Date (the &#147;Over-Subscription
Privilege&#148;). If you do not fully subscribe for your Primary Right, your ownership may be diluted.
See &#147;Risk Factors &#150; Dilution of Ownership.&#148;
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">We intend to file an application to list our Preference Stock on the New York Stock Exchange, Inc.
under the symbol &#147;&#091; &#093;,&#148; but we cannot assure you that the Preference Stock will be listed for
trading or that a liquid market for our Preference Stock will develop. Since August&nbsp;21, 1990, our
common stock has traded on the NYSE under the symbol &#147;MXE.&#148;
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><B>An
investment in the Fund involves risks. See &#147;Risk Factors&#148; beginning on page&nbsp;9.</B>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">We will conduct a special tender offer for Preference Stock only (a &#147;Tender Offer&#148;) on a
semi-annual basis, on dates to be determined by the Board of Directors but beginning no earlier
than March&nbsp;2006, in which 25% of the issued and outstanding Preference Stock as of the date the
Preference Stock is issued may be tendered to the Fund and repurchased in kind for the Fund&#146;s
portfolio securities. Each stockholder participating in a Tender Offer may have his or her tendered
shares of Preference Stock repurchased by the Fund in kind for portfolio securities having a value
equal to 99% of NAV as determined on the date of each Tender Offer.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><B>Neither the SEC nor any state securities commission has approved or disapproved of these securities
or determined if this Prospectus is truthful or complete. Any representation to the contrary is a
criminal offense.</B>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">The Mexico Equity &#038; Income Fund, Inc. is registered under the Investment Company Act of 1940, as
amended, as a closed-end, non-diversified management investment company. Our investment objective
is high total return through capital appreciation and current income by investing at least 80% of
the Fund&#146;s assets in equity and convertible securities issued by Mexican companies and debt
securities of Mexican issuers.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">This Prospectus sets forth concisely the information about the Fund that a prospective investor
ought to know before investing. Additional information about the Fund has been filed with the SEC
and is available upon written or oral request and without charge by calling our administrator at
(888)&nbsp;294-8217. Our SEC filings, including annual and semi-annual reports to stockholders, are also
available to the public on the SEC&#146;s Internet website at http://www.sec.gov and can be inspected at
the offices of the NYSE, 20 Broad Street, New York, NY 10005. We do not have a website. This
Prospectus should be retained for future reference.
</DIV>


<P align="center" style="font-size: 10pt">&nbsp;
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>

<DIV style="font-family: 'Times New Roman',Times,serif">




<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;You should rely only on the information contained in this Prospectus. We have not authorized
any other person to provide you with different information. If anyone provides you with different
or inconsistent information, you should not rely on it. This Prospectus is not an offer to sell or
issue, or a solicitation of an offer to buy or accept, any securities in any jurisdiction where it
is unlawful to make such an offer or solicitation.
</DIV>

<DIV align="left">
<!-- TOC -->
</DIV>
<DIV align="left">
<A name="tocpage"></A>
</DIV>


<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>TABLE OF CONTENTS</B>
</DIV>

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="88%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px"><A href="#101">Prospectus Summary</A></DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px"><A href="#102">The Offering</A></DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">3</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px"><A href="#103">Fees and Expenses</A></DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">6</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px"><A href="#104">Financial Highlights</A></DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">7</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px"><A href="#105">Risk Factors</A></DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">9</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px"><A href="#106">Preference Common Stock Rights Offering</A></DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">12</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px"><A href="#107">Material United States Federal Income Tax Consequences</A></DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">18</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px"><A href="#108">Use of Proceeds</A></DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">22</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px"><A href="#109">Price Range of Common Stock</A></DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">22</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px"><A href="#110">Distributions</A></DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">22</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px"><A href="#111">Business of the Fund</A></DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">23</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px"><A href="#112">Management</A></DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">24</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px"><A href="#113">Compensation of Directors</A></DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">27</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px"><A href="#114">Investment Advisory Agreement</A></DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">27</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px"><A href="#115">Administration Agreement</A></DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">29</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px"><A href="#116">Control Persons and Principal Stockholders</A></DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">29</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px"><A href="#117">Determination of Net Asset Value</A></DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">30</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px"><A href="#118">Description of our Capital Stock</A></DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">30</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px"><A href="#119">Limitation on Liability of Directors and Officers; Indemnification and Advancement of Expenses</A></DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">31</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px"><A href="#120">Provisions of the Maryland General Corporation Law and our Charter and Bylaws</A></DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">32</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px"><A href="#121">Regulation</A></DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">32</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px"><A href="#122">Share Repurchases</A></DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">37</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px"><A href="#123">Custodian, Transfer and Dividend Paying Agent and Registrar</A></DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">39</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px"><A href="#124">Brokerage Allocation and Other Practices</A></DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">39</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px"><A href="#125">Privacy Policy</A></DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">39</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px"><A href="#126">Legal Matters</A></DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">40</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">

<TD><DIV style="margin-left:15px; text-indent:-15px"><A href="#127">Experts</A></DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">40</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px"><A href="#128">Available Information</A></DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">41</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px"><A href="#129">Forward-Looking Statements</A></DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">41</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px"><A href="#130">Financial Statements</A></DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">41</TD>
    <TD>&nbsp;</TD>
</TR>
<!-- End Table Body -->
<TR><TD colspan="9"><FONT size="2">&nbsp;<A HREF="c98194exv2wn.htm">Consent of Tait, Weller & Baker LLP</A></FONT></TD></TR>
</TABLE>
</DIV>
<DIV align="left">
<!-- /TOC -->
</DIV>


<P align="center" style="font-size: 10pt">ii
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<P>
<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV style="width: 100%; border: 1px solid black; padding: 11px;">


<DIV align="left">
<A name="101"></A>
</DIV>

<DIV align="center" style="font-size: 12pt; margin-top: 18pt"><B>Prospectus Summary</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<I>This summary highlights some of the information in this Prospectus. It may not contain
all of the information that you may want to consider. You should read carefully the more detailed
information set forth under &#147;Risk Factors&#148; and the other information included in this Prospectus.
The terms &#147;we,&#148; &#147;us,&#148; the &#147;Fund&#148; and &#147;our&#148; refer to The Mexico Equity &#038; Income Fund, Inc. &#147;PAM&#148; or
the &#147;investment adviser&#148; refers to Pichardo Asset Management, S.A. de C.V.</I>
</DIV>

<DIV align="left" style="font-size: 12pt; margin-top: 12pt"><B>The Company</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><B>General</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We were incorporated in Maryland on May&nbsp;24, 1990 and commenced investment operations on August
21, 1990. We are registered under the Investment Company Act of 1940, as amended ( the &#147;1940
Act&#148;), as a closed&#150;end, non-diversified management investment company. Our common stock is listed
and trades on the NYSE under the trading symbol &#147;MXE.&#148;
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>Our Investment Objective</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our investment objective is high total return through capital appreciation and current income.
We seek to achieve our investment objective by investing at least 80% of our assets in equity and
convertible securities issued by Mexican companies and debt securities of Mexican issuers.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>Our Adviser</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our investment adviser is Pichardo Asset Management, S.A. de C.V., a corporation organized
under the laws of Mexico. PAM is an investment adviser registered under the Investment Advisers
Act of 1940, as amended (the &#147;Advisers Act&#148;). Maria Eugenia Pichardo, who owns 99% of PAM, has
acted as the Fund&#146;s portfolio manager since the inception of the Fund in 1990. Under our
Investment Advisory Agreement, we pay PAM a monthly fee at an annual rate of 0.80% of the value of
our average daily net assets. See &#147;Investment Advisory Agreement.&#148;
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>Rights Offering of Preference Common Stock</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Each of our stockholders as of the Record Date shall receive, at no cost, 0.75 nontransferable
rights (each whole right, a &#147;Subscription Right&#148;) to purchase one share of Preference Common Stock
(&#147;Preference Stock&#148;) for each share of our common stock such stockholder owns as of the Record Date
(the &#147;Primary Right&#148;). We will not issue fractional shares of our common stock upon the exercise
of any Rights (as defined below). The number of Rights issued to Record Date stockholders will be
rounded down to the nearest whole number of Rights. We intend to offer shares of Preference Stock
to these stockholders for a price (the &#147;Subscription Price&#148;) equal to the greater of (a)&nbsp;90% of the
Fund&#146;s net asset value per share (&#147;NAV&#148;) as determined on the Expiration Date (as defined herein)
or (b)&nbsp;the average closing price of our common stock as of the Expiration Date. The &#147;average
closing price&#148; of our common stock shall be calculated as an average of the last reported sale
prices of a share of our common stock on the NYSE over the four consecutive trading days ending on
the Expiration Date. The offer to purchase Preference Stock will expire at 5:00 p.m., New York City
time, on &#091;&#095;&#095;&#095;&#095;&#095;&#095;&#095;&#095;&#093;, 2005, unless we decide to extend it to some later date (the &#147;Expiration
Date&#148;).
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If you elect to purchase the maximum amount of our Preference Stock that you are entitled to
purchase pursuant to your Primary Right, you will also be entitled to subscribe, subject to
allotment, to purchase additional shares of our Preference Stock, if any, that are not purchased by
our other stockholders pursuant to their Primary Right as of the Expiration Date (the
&#147;Over-Subscription Privilege&#148;). See &#147;Preference Common Stock Rights Offering &#150; Over-Subscription
Privilege.&#148; If you do not fully subscribe for your Primary Right, your ownership is likely to be
diluted. See &#147;Risk Factors &#150; Dilution of Ownership.&#148; The Subscription Rights and the
Over-Subscription Privilege shall be collectively referred to below as the &#147;Rights.&#148;
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Fund will conduct a series of tender offers for Preference Stock only (a &#147;Tender Offer&#148;)
on a semi-annual basis (each semi-annual period, a &#147;Tender Period&#148;), on dates to be determined by
the Board of Directors and beginning within the 6&nbsp;month period between January&nbsp;31, 2006 and July
31, 2006, in which 25% of the issued and outstanding Preference Stock on the date the Preference
Stock is issued may be tendered to the Fund and
</DIV>

<P align="center" style="font-size: 10pt">1
</DIV>

</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">
</DIV>


<P>
<DIV style="width: 100%; border: 1px solid black; padding: 11px;">


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">repurchased in kind for the Fund&#146;s portfolio securities. The consideration for the Preference
Stock to be repurchased by the Fund shall be that value of portfolio securities equal to 99% of NAV
as determined, with respect to each Tender Offer, on a date designated by the Board. The Fund may
pay cash for fractional shares; or round off (up or down) fractional shares so as to eliminate them
prior to distribution. See &#147;Preference Common Stock Rights Offering &#150; Semi Annual Tender Offer.&#148;
</DIV>


<DIV align="left" style="font-size: 12pt; margin-top: 12pt"><B>How to Obtain Subscription Information</B>
</DIV>


<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><FONT face="Wingdings">&#216;</FONT></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Contact your broker-dealer, trust company, bank or other nominee, or</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><FONT face="Wingdings">&#216;</FONT></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Contact the Subscribing Agent named below toll-free at (800)
245-7630.</TD>
</TR>

</TABLE>
</DIV>

<DIV align="left" style="font-size: 12pt; margin-top: 12pt"><B>How to Subscribe</B>
</DIV>


<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><FONT face="Wingdings">&#216;</FONT></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Deliver a completed &#147;Preference Common Stock Purchase
Form&#148; (enclosed)&nbsp;and payment to the Subscribing Agent
at the address below (Attn: &#95;&#95;&#95;Dept.) so that it
is received by the Expiration Date (we recommend using
an insured courier), or</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><FONT face="Wingdings">&#216;</FONT></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>If you hold shares of our common stock through a broker, dealer,
trustee or other nominee, then that nominee is called the &#147;record
holder&#148; of your shares. We will ask your record holder to notify
you of this offering. If you wish to elect to purchase the
Preference Stock, you will need to have the record holder act for
you. To indicate your decision about your rights, you should
complete and return to the record holder, with the proper payment,
a &#147;Beneficial Owner Election Form.&#148; You should receive this form
from the record holder with the other offering materials.</TD>
</TR>

</TABLE>
</DIV>

<DIV align="left" style="font-size: 12pt; margin-top: 12pt"><B>Subscribing Agent</B>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">Computershare Trust Company of New York, 88 Pine Street &#151; 19th Floor, New York NY 10005 (the
&#147;Subscribing Agent&#148;).
</DIV>


<DIV align="left" style="font-size: 12pt; margin-top: 12pt"><B>Important Dates to Remember</B>
</DIV>

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="64%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Record Date</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#091;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#093;, 2005</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD nowrap><DIV style="margin-left:15px; text-indent:-15px">Subscription Period</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&#091;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;&nbsp;&#093;,&nbsp;2005-&#091;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD nowrap align="right">&#093;, 2005</TD>
    <TD nowrap>*</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Expiration Date/ Deadline to Purchase Preference Stock&#134;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#091;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">&#093;, 2005</TD>
    <TD nowrap>*</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Confirmation Mailed to Participating Holders</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#091;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#093;, 2005</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>



<DIV align="left">
<DIV style="font-size: 3pt; margin-top: 16pt; width: 18%; border-top: 1px solid #000000">&nbsp;</DIV>
</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">
<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96"></TD>
</TR>

<TR valign="top">
    <TD nowrap align="left">*</TD>
    <TD>&nbsp;</TD>
    <TD>Unless the offer is extended.</TD>
</TR>

<TR style="font-size: 3pt"><TD>&nbsp;</TD></TR>

<TR valign="top">
    <TD nowrap align="left">&#134;</TD>
    <TD>&nbsp;</TD>
    <TD>A person purchasing Preference Stock pursuant to his
or her Rights must deliver a Preference Common Stock
Purchase Form and payment for the Preference Stock to
the Subscribing Agent so that it is received by the
Expiration Date, unless the offer is extended.</TD>
</TR>

</TABLE>



<P align="center" style="font-size: 10pt">2
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">
</DIV>


<P>
<DIV style="width: 100%; border: 1px solid black; padding: 11px;">


<DIV align="left">
<A name="102"></A>
</DIV>

<DIV align="left" style="font-size: 12pt; margin-top: 12pt"><B>The Offering</B>
</DIV>

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="35%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="65%">&nbsp;</TD>
</TR>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Preference Stock to be issued by Us
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">1,855,128 shares of Preference Stock</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Description of Preference Stock
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Shares of the Preference Stock will
have identical rights, voting
powers, restrictions, and
qualifications of the common stock
of the Fund except for the
repurchase and conversion
preference features described in
&#147;Repurchase&#148; and &#147;Automatic
Conversion&#148; below.</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Purpose of the Offering/Use of Proceeds
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">As of July&nbsp;31, 2005, portfolio
sales have resulted in the
probability that we will be
required, under Subchapter M of the
Code, to distribute the capital
gains realized on such sales to our
stockholders. We are required to
distribute at least 98% of the our
realized capital gains, if any, for
the one-year period ending on
October&nbsp;31 of each calendar year.
If we do not distribute any
realized capital gains by January
31, 2006, we will not be able to
meet the Subchapter M requirements
with respect to calendar year 2005.
We are making this offering to
raise cash to permit us to meet our
distribution requirements of
capital gains realized, if any, in
an effort (i)&nbsp;to avoid an excise
tax and to meet our Subchapter M
requirements and (ii)&nbsp;to avoid
having to sell portfolio securities
which would further decrease the
Fund&#146;s assets to invest and would
result in additional realized
capital gains. See &#147;Preference
Common Stock Rights Offering &#150;
Purpose of the Offering/Use of
Proceeds.&#148; Any remaining proceeds,
after meeting our current
distribution requirements, will be
invested in accordance with the
Fund&#146;s investment objectives and
policies as stated herein. See
&#147;Business of the Fund.&#148;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Subscription Rights
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Each of our stockholders as of the
Record Date shall receive, at no
cost, 0.75 nontransferable rights
(each whole right, a &#147;Subscription
Right&#148;) to purchase one share of
Preference Stock for each share of
our common stock such stockholder
owns as of the Record Date (the
&#147;Primary Right&#148;). We will not
issue fractional shares of our
common stock upon the exercise of
Rights. The number of Rights issued
to Record Date stockholders will be
rounded down to the nearest whole
number of Rights. We intend to
offer shares of Preference Stock to
these stockholders for a price (the
&#147;Subscription Price&#148;) equal to the
greater of (a)&nbsp;90% of the Fund&#146;s
net asset value (&#147;NAV&#148;) as
determined on the Expiration Date
or (b)&nbsp;the average closing price of
our common stock over the four
consecutive trading days ending on
the Expiration Date.</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Over-Subscription Privilege
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">If you elect to purchase the
maximum amount of our Preference
Stock that you are entitled to
purchase pursuant to your Primary
Right, you will also be entitled to
subscribe, subject to allotment, to
purchase additional shares of our
Preference Stock, if any, that are
not purchased by our other
stockholders pursuant to their
Primary Right as of the Expiration
Date (the &#147;Over-Subscription
Privilege&#148;). See &#147;Preference Common
Stock Rights Offering &#150;
Over-Subscription Privilege.&#148; If
you do not fully subscribe for your
Primary Right, your ownership is
likely to be diluted. See &#147;Risk
Factors &#150; Dilution of Ownership.&#148;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Expiration Date
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">5:00 p.m., New York City time, on
&#091;&nbsp;&nbsp;&nbsp;&nbsp;&#093;, 2005, unless we
decide to extend it to some later
date.</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Repurchase
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">The Fund will conduct a series of
tender offers for the Preference
Stock only (a &#147;Tender Offer&#148;) on a
semi-annual basis (each semi-annual
period, a &#147;Tender Period&#148;), on
dates to be determined by the Board
of Directors and beginning within
the 6&nbsp;month period between January
31, 2006 and July&nbsp;31, 2006, in
which 25% of the issued and
outstanding Preference Stock on</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<P align="center" style="font-size: 10pt">3
</DIV>

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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">
</DIV>


<P>
<DIV style="width: 100%; border: 1px solid black; padding: 11px;">


<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="35%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="65%">&nbsp;</TD>
</TR>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">the
date the Preference Stock is issued
may be tendered to the Fund and
repurchased in kind for the Fund&#146;s
portfolio securities. The
consideration for the Preference
Stock to be repurchased by the Fund
shall be that value of portfolio
securities equal to 99% of NAV as
determined, with respect to each
Tender Offer, on a date designated
by the Board.</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">The Fund may pay cash for
fractional shares; or round off (up
or down) fractional shares so as to
eliminate them prior to
distribution. See &#147;Preference
Common Stock Rights Offering &#150; Semi
Annual Tender Offer.&#148;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Automatic Conversion
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">In the event the Put Warrant
Program (as defined herein) is
approved by the SEC and upon the
anticipated issuance of put
warrants by the Fund, all issued
and outstanding shares of
Preference Stock will automatically
convert to our common stock on a
one-to-one basis., and, shortly
thereafter, stockholders will
receive put warrants. See
&#147;Preference Common Stock Rights
Offering-Put Warrant Program.&#148;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Risk Factors
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">See &#147;Risk Factors&#148; beginning on
page&nbsp;9 and the other information
included in this Prospectus for a
discussion of risks that you should
carefully consider about us and
about this offering.</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Non-Transferability of the Rights
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Your Rights are non-transferable.
If you do not exercise them, you
give up any right to the underlying
shares of Preference Stock.</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Termination of the Offering
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">The Board of Directors may decide
to terminate this offering at any
time, on or before the Expiration
Date. If we terminate the
offering, our only obligation to
you will be to return any payment,
without interest.</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Distribution Arrangements
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">We do not intend to engage a dealer
manager for the offer. Our officers
and directors may solicit the
exercise of Rights by our
stockholders. The offer is not
contingent on any number of Rights
being exercised. We will pay all
expenses incurred in connection
with the offer.</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Listing
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">It is the Fund&#146;s intention to list
the Preference Stock for trading on
the NYSE under the symbol &#147;&#091;&nbsp;&nbsp;&nbsp;&nbsp;
&#093;&#148; prior to the issuance of the
Preference Stock.</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Trading
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">We cannot assure you that the
Preference Stock will develop any
liquidity in the secondary market.
In addition, we cannot predict how
the issuance of the Preference
Stock will affect the market value
of our common stock.</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Material United States Federal Income
Tax Consequences
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">The receipt and election to
purchase Preference Stock are
intended to be nontaxable events.
If you sell the Preference Stock
after purchasing them, you will
recognize gain or loss. You should
obtain specific tax advice from
your personal tax advisor. See
&#147;Material United States Federal
Income Tax Consequences &#151;Taxation
of Stockholders&#148; below.</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Available Information
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">We are subject to the reporting
requirements of the 1940 Act and
are required to file reports, proxy
statements and other information
with the SEC. This information
will be available at the SEC&#146;s
public reference room at 100 F St.
NE, Washington, D.C. 20549. You may
call the SEC at 1-800-SEC-0330 for
information on the operation of the
Public Reference Room. Our SEC
filings are also available to the
public on the SEC&#146;s Internet
website at <U>http://www.sec.gov</U> and
can be inspected at the offices of
the NYSE, 20 Broad Street, New
York, NY 10005.</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Management Arrangements
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Pichardo Asset Management, S.A. de
C.V. (&#147;PAM&#148;) serves as our
investment adviser. U.S. Bancorp
Fund Services, LLC
(&#147;Administrator&#148;)</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<P align="center" style="font-size: 10pt">4
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">
</DIV>


<P>
<DIV style="width: 100%; border: 1px solid black; padding: 11px;">


<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="35%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="65%">&nbsp;</TD>
</TR>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">serves as our
administrator. For a description
of PAM or the Administrator and our
contractual arrangements with these
companies, see &#147;Investment Advisory
Agreement&#148; and &#147;Administration
Agreement.&#148;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Subscribing Agent
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Computershare Trust Company of New
York, 88 Pine Street &#151; 19th Floor,
New York NY 10005 (800)&nbsp;245-7630.</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">

<TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Dilution
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">As a result of the terms of this
offer, stockholders who do not
fully exercise their Rights will
own, upon completion of this offer,
a smaller proportional interest in
us than they owned prior to the
offer. In addition, because the
Subscription Price may be less than
NAV per share, the offer may result
in an immediate dilution of NAV.
See &#147;Risk Factors &#150; Dilution of
Ownership.&#148;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<P align="center" style="font-size: 10pt">5
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">
</DIV>


<P>
<DIV style="width: 100%; border: 1px solid black; padding: 11px;">


<DIV align="left">
<A name="103"></A>
</DIV>

<DIV align="left" style="font-size: 12pt; margin-top: 12pt"><B>Fees and Expenses</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The following table is intended to assist prospective investors in understanding the
costs and expenses associated with this offering and an investment in the Fund.
</DIV>
<DIV align="center">
<TABLE style="font-size: pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="35%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="65%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD nowrap align="left" style="border-bottom: 1px solid #000000"><B>Stockholder transaction expenses(1):</B></TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<!-- End Table Body -->
</TABLE>

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom" style="font-size: 1pt">
    <TD width="88%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Total stockholder transaction expenses</DIV></TD>
    <TD align="right">$</TD>
    <TD>&nbsp;</TD>

    <TD align="right">0</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px"><B>Annual expenses </B>(as a percentage of net assets of the Fund), as of July&nbsp;31, 2005:</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Management fees</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">0.80</TD>
    <TD nowrap>%</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Interest payments on borrowed funds</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD nowrap>(2)</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Other expenses</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">0.97</TD>
    <TD nowrap>%</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Total annual expenses</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">1.77</TD>
    <TD nowrap>%</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>



<DIV align="left">
<DIV style="font-size: 3pt; margin-top: 16pt; width: 18%; border-top: 1px solid #000000">&nbsp;</DIV>
</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">
<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96"></TD>
</TR>

<TR valign="top">
    <TD nowrap align="left">(1)</TD>
    <TD>&nbsp;</TD>
    <TD><I>We will pay all transactions expenses incurred in connection with this offering.</I></TD>
</TR>

<TR style="font-size: 3pt"><TD>&nbsp;</TD></TR>

<TR valign="top">
    <TD nowrap align="left">(2)</TD>
    <TD>&nbsp;</TD>
    <TD><I>We do not plan to incur any indebtedness, or to pay interest in respect thereof, during the
term after this offering.</I></TD>
</TR>

</TABLE>



<DIV align="left" style="font-size: 12pt; margin-top: 12pt"><B>Example</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The following example demonstrates the projected dollar amount of total cumulative expenses
that would be incurred over various periods with respect to a hypothetical investment in the Fund.
These amounts are based upon payment by an investor of a $1,000 as an investment in the Fund and
our payment of annual operating expenses at the levels set forth in the table above which, as
indicated above, does not include leverage or related expenses.
</DIV>
<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="52%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>1 year</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>3 years</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>5 years</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2"><B>10 years</B></TD>
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="15" nowrap align="left" style="border-top: 1px solid #000000">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">You would pay the following
expenses on a $1,000
investment,
assuming a 5% annual return</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">18</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">56</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">96</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">208</TD>
    <TD>&nbsp;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">This example and the expenses in the table above should not be considered a representation of our
future expenses, and actual expenses may be greater or less than those shown. Moreover, while the
example assumes, as required by the SEC, a 5% annual return, our performance will vary and may
result in a return greater or less than 5%.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We will not pay any broker or dealer, commercial bank, trust company or other person any
solicitation fee for any Preference Stock purchased pursuant to this offering. No such broker,
dealer, commercial bank, trust company or other person has been authorized to act as our agent for
purposes of this offering.
</DIV>
</DIV>




<P align="center" style="font-size: 10pt">6
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">



<P>
<DIV style="width: 100%; border: 1px solid black; padding: 11px;">


<DIV align="left">
<A name="104"></A>
</DIV>

<DIV align="left" style="font-size: 12pt; margin-top: 12pt"><B>Financial Highlights</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><B>For a Share Outstanding Throughout Each Year</B>
</DIV>

<DIV align="center">
<TABLE style="font-size: 8pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="20%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<TR style="font-size: 7pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">For the Year</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">For the Year</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">For the Year</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">For the Year</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">For the Year</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">For the Year</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">For the Year</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">For the Year</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 7pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">Ended</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">For the Year Ended</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">For the Year Ended</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">Ended</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">Ended</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">Ended</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">Ended</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">Ended</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">Ended</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">Ended</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 7pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">July 31,</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">July 31,</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">July 31,</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">July 31,</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">July 31,</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">July 31,</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">July 31,</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">July 31,</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">July 31,</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">July 31,</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 7pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000">2005</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000">2004</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000">2003</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000">2002</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000">2001</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000">2000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000">1999</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000">1998</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000">1997</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000">1996</TD>
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Per Share Operating
Performance
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
      <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">
Net asset value,
beginning of period</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">13.66</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">10.15</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">8.74</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">10.19</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">11.36</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">8.64</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">10.16</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">16.83</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">11.96</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">11.31</TD>
    <TD>&nbsp;</TD>
</TR>

<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Net investment income
(loss)</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(0.01</TD>
    <TD nowrap>)(1)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(0.02</TD>
    <TD nowrap>)(1)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">0.00</TD>
    <TD nowrap>(2)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(0.03</TD>
    <TD nowrap>)(1)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(0.02</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">0.03</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">0.22</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">0.23</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">0.43</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">0.81</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Net realized and
unrealized gains (losses)
on investments and
foreign currency
transactions</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">7.60</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">3.55</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1.41</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(1.42</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(0.64</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2.62</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(0.87</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(3.34</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">5.55</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">0.67</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Net increase (decrease)
from
investment operations</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">7.61</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">3.53</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1.41</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(1.45</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(0.66</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2.65</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(0.65</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(3.11</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">5.98</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1.48</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Less: Distributions
Dividends from net
investment income</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(0.02</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(0.01</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(0.12</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(0.19</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(0.44</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Distributions from net
realized gains</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(0.60</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(0.93</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(3.37</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(0.67</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(0.09</TD>
    <TD nowrap>)</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Return of capital</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(0.01</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Total dividends and
distributions</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(0.02</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(0.62</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(0.12</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(0.93</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(3.56</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(1.11</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(0.09</TD>
    <TD nowrap>)</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Capital share transactions
Anti-dilutive effect of
Tender Offer</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">0.09</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">0.04</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Anti-dilutive effect of
dividend reinvestment</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Dilutive effect of rights
offering</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(0.74</TD>
    <TD nowrap>)</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR><TD>&nbsp;</TD></TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Anti-dilutive effect of
Share
Repurchase Program</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">0.02</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">0.19</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">0.02</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Total capital share
transactions</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">0.11</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">0.19</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">0.06</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(0.74</TD>
    <TD nowrap>)</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Net asset value, end of
period</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">21.27</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">13.66</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">10.15</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">8.74</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">10.19</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">11.36</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">8.64</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">10.16</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">16.83</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">11.96</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px double #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px double #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px double #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px double #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px double #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px double #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px double #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px double #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px double #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="2" align="right" style="border-top: 3px double #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Per share market value,
end of period</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">18.82</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">11.73</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">9.10</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">7.95</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">9.11</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">10.69</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">7.06</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">7.75</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">14.125</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">9.625</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Total Investment Return
Based on Market Value,
end of period*</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">60.44</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">29.10</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">14.47</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(12.73</TD>
    <TD nowrap>)%</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(8.64</TD>
    <TD nowrap>)%</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">53.36</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">7.24</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(26.23</TD>
    <TD nowrap>)%</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">62.52</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(8.26</TD>
    <TD nowrap>)%</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>
<P align="center" style="font-size: 10pt">7
</DIV>



</DIV>




<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>
<DIV style="font-family: 'Times New Roman',Times,serif">


<P>
<DIV style="width: 100%; border: 1px solid black; padding: 11px;">



<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><B>Financial Highlights (concluded)<BR>
For a Share Outstanding Throughout Each Year</B>

</DIV>
<DIV align="center">
<TABLE style="font-size: 7pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="20%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">For the</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">For the Year</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">For the Year</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">Year</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>

<TD nowrap align="center" colspan="2">Ended</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">Ended</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">Ended</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">For the Year</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">For the Year</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">For the Year</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">For the Year</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">For the Year</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">For the Year</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">For the Year</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">July 31,</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">July 31,</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">July 31,</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">Ended</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">Ended</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">Ended</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">Ended</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">Ended</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">Ended</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">Ended</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>


<TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000">2005</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000">2004</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000">2003</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000">July 31, 2002</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000">July 31, 2001</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000">July 31, 2000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000">July 31, 1999</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000">July 31, 1998</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000">July 31, 1997</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000">July 31, 1996</TD>
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->

<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px"><B>Ratios/Supplemental
Data</B></DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Net assets, end of
period (in 000s)</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">52,621</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">33,779</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">25,104</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">21,629</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">87,620</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">114,112</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">97,150</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">120,148</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">199,066</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">141,448</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Ratios of expenses
to average net
assets:</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Before expense
reimbursement</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">1.77</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">2.09</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">2.64</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">1.81</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">1.90</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">2.03</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">1.88</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">1.46</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">1.49</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">1.56</TD>
    <TD nowrap>%</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:30px; text-indent:-15px">After expense
reimbursement</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">1.77</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">2.08</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">2.62</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">1.81</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">1.90</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">2.03</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">1.88</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">1.46</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">1.49</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">1/56</TD>
    <TD nowrap>%</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Ratios of net
investment income
(loss)&nbsp;to
average net assets:</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:30px; text-indent:-15px">Before expense
reimbursement</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">0.03</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(0.15</TD>
    <TD nowrap>)%</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">0.02</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(0.14</TD>
    <TD nowrap>)%</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(0.16</TD>
    <TD nowrap>)%</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">0.27</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">2.72</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">1.65</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">3.29</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">7.32</TD>
    <TD nowrap>%</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-15px">After expense
reimbursement</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">0.03</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(0.14</TD>
    <TD nowrap>)%</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">0.04</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(0.14</TD>
    <TD nowrap>)%</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">(0.16</TD>
    <TD nowrap>)%</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">0.27</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">2.72</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">1.65</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">3.29</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">7.32</TD>
    <TD nowrap>%</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Portfolio turnover</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">258.85</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">234.42</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">180.67</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">189.05</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">220.85</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">249.28</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">163.23</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">88.85</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">127.44</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">&nbsp;</TD>
    <TD align="right">42.59</TD>
    <TD nowrap>%</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>



<DIV align="left">
<DIV style="font-size: 3pt; margin-top: 16pt; width: 18%; border-top: 1px solid #000000">&nbsp;</DIV>
</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">
<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96"></TD>
</TR>

<TR valign="top">
    <TD nowrap align="left">*</TD>
    <TD>&nbsp;</TD>
    <TD>Total investment return is calculated assuming a purchase of common stock at the current
market price on the first day and a sale at the current market price on the last day of each
period reported. Dividends and distributions, if any, are assumed for purposes of this
calculation to be reinvested at prices obtained under the Fund&#146;s dividend reinvestment plan.
Total investment return does not reflect brokerage commissions.</TD>
</TR>

<TR style="font-size: 3pt"><TD>&nbsp;</TD></TR>

<TR valign="top">
    <TD nowrap align="left">(1)</TD>
    <TD>&nbsp;</TD>
    <TD>Net investment income per share is calculated using ending balances prior to consideration of
adjustments for permanent financial reporting and tax differences.</TD>
</TR>

<TR style="font-size: 3pt"><TD>&nbsp;</TD></TR>

<TR valign="top">
    <TD nowrap align="left">(2)</TD>
    <TD>&nbsp;</TD>
    <TD>The amount listed is less than $0.005 per share.</TD>
</TR>

</TABLE>


<P align="center" style="font-size: 10pt">8
</DIV>
</DIV>
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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">




<P>
<DIV style="width: 100%; border: 1px solid black; padding: 11px;">


<DIV align="left">
<A name="105"></A>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>Risk Factors</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<I>An investment in the Fund involves risks. You should carefully consider these risk
factors, together with all of the other information included in this Prospectus. If any of the
following adverse events and circumstances described in the risk factors occur, our business,
financial condition and results of operations could be materially adversely affected, and our NAV
and the trading price of our common stock and the Preference Stock could decline.</I>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>RISKS RELATED TO THIS OFFERING</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B><I>Decline in Preference Stock Trading Price: </I></B>The public trading price for our Preference Stock
cannot yet be determined as there is currently no market for the Preference Stock. After you
purchase Preference Stock, and once a market is established for the Preference Stock, the public
trading price of our Preference Stock may decline. If our trading price declines below the
Subscription Price, you will suffer an immediate unrealized loss.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B><I>Absence of Existing Public Market; Market Prices: </I></B>There is no existing market for the
Preference Stock. There can be no assurance that an active and liquid trading market for the
Preference Stock will develop or that quotation of the Preference Stock will be available on the
NYSE. Future trading prices of the Preference Stock will depend on many factors including, among
other things, prevailing interest rates, the operating results and financial condition of the Fund,
and the market for similar securities.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B><I>No Revocation: </I></B>Once you elect to purchase Preference Stock, you may not revoke the election,
even if you later learn information about us that you consider to be unfavorable.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B><I>Value versus Subscription Price: </I></B>The Subscription Price was not determined based on
established criteria for valuation, such as expected future operations, cash flows or financial
condition. You should not rely on the Subscription Price to bear a relationship to those criteria
or to be a guaranty of the value of the Fund or of our Preference Stock.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B><I>Termination of Offering: </I></B>Our Board of Directors may terminate the offering at any time. If
we decide to terminate the offering, we have no obligation to you except to return, without
interest, your subscription payments.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B><I>Discount to Net Asset Value: </I></B>The Fund&#146;s shares of common stock have historically traded on the
NYSE at a discount to the Fund&#146;s NAV per share, and the discount has at times exceeded 20%. There
is no assurance that this offering of Preference Stock or any subsequent Tender Offer will have any
effect on the persistent discount to NAV experienced by the Fund.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B><I>Dilution of Ownership: </I></B>As a result of the terms of this offer, stockholders who do not fully
exercise their Rights will own, upon completion of this offer, a smaller proportional interest in
our voting stock than they owned prior to the offer. In addition, because the Subscription Price
may be less than NAV per share, the offer may result in an immediate dilution of NAV per share for
all of our stockholders. Such dilution is not currently determinable because it is not known how
many shares of Preference Stock will be subscribed for, what the market price of our Preference
Stock will be on the Expiration Date or what the Subscription Price will be. Such dilution will
disproportionately affect non-exercising stockholders.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B><I>Unwillingness of Brokers to Hold Foreign Securities: </I></B>As more fully stated in &#147;Preference
Common Stock Rights Offering &#150; Semi Annual Tender Offer,&#148; stockholders participating in the Tender
Offers will receive the Fund&#146;s portfolio securities in exchange for tendering their Preference
Stock to the Fund for repurchase. The majority of such portfolio securities will be securities of
Mexican issuers. Your broker may be unwilling to hold such foreign securities for you.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>RISKS RELATED TO THE FUND&#146;S INVESTMENTS</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B><I>Investments in Foreign Securities Risks: </I></B>We invest a majority of our assets in foreign
securities of Mexican issuers. Investing in the Mexican financial market presents political,
regulatory and economic risks which are significant and which may differ in kind and degree from
the risks presented by investing in the U.S. financial
</DIV>
</DIV>



<P align="center" style="font-size: 10pt">9
</DIV>

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<DIV style="font-family: 'Times New Roman',Times,serif">
<P>
<DIV style="width: 100%; border: 1px solid black; padding: 11px;">


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">markets. Some of these risks may include changes in foreign currency exchange rates or
controls, greater price volatility, differences in accounting standards and policies, and in the
type and nature of disclosures required to be provided by Mexican issuers, substantially less
liquidity, controls on foreign investment, and limitations on repatriation of invested capital. Our
exposure to developing country financial markets may involve greater risk than a portfolio that
invests only in developed country financial markets. Some of these risks are detailed below:
</DIV>



<DIV align="left" style="font-size: 10pt; margin-top: 6pt; margin-left: 3%">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<I>Market Illiquidity, Volatility. </I>Although one of the largest in Latin America by
market capitalization, the Bolsa Mexicana de Valores, S.A. de C.V. (the &#147;Mexican Stock
Exchange&#148; or &#147;Bolsa&#148;) is substantially smaller, less liquid and more volatile than the major
securities markets in the United States. In addition, trading on the Mexican Stock Exchange
is concentrated. Approximately 80% of the total traded volume of the Mexican Stock Exchange
in 2004 was produced by fourteen issuers as of December&nbsp;31, 2004. At such date, the stock of
<I>Tel&#233;fonos de Mexico, S.A. de C.V. </I>(&#147;Telmex&#148;) and its affiliates accounted for approximately
23.225% of the aggregate market capitalization of the Mexican Stock Exchange, while no
single stock issue accounted for more than 2.6% of the aggregate market capitalization of
the NASDAQ and the NYSE. Thus, the performance of the Mexican Stock Exchange, as further
described below, is highly dependent on the performance of a few issuers. Additionally,
prices of equity securities traded on the Mexican Stock Exchange are generally more volatile
than prices of equity securities traded on the NYSE. The combination of price volatility and
the relatively limited liquidity of the Mexican Stock Exchange may have an adverse impact on
the investment performance of the Fund.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt; margin-left: 3%">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<I>Market Corrections. </I>Although less so in recent times, the Mexican securities market has
been subject to periodic severe market corrections. In the two months following the general
destabilization of the Mexican economy in December&nbsp;1994, the Bolsa&#146;s Index declined 36.3% in
nominal peso terms and 58.0% in dollar terms from December&nbsp;20, 1994 to February&nbsp;27, 1995
before beginning to recover. Due to the high concentration of investors, issuers and
intermediaries in the Mexican securities market and the general high volatility of the
Mexican economy, the Mexican securities market may be subject to severe market corrections
than more broadly based markets. As is the case with investing in any securities market,
there can be no assurance that market corrections will not occur again.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt; margin-left: 3%">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<I>The Mexican Economy. </I>The Mexican economy is currently stable as a result of initiatives
implemented in the last few years, successful free trade agreements with other countries,
economic and fiscal discipline and stable political and social conditions. Nevertheless, in
the past the Mexican economy has experienced peso devaluations, significant rises in
inflation and domestic interest rates and other economic instability and there can be no
assurance that the economy will remain stable. In addition, although Mexico has exhibited in
recent times positive market indicators in terms of GDP growth, long-term interest rates,
current account deficits, exports, and foreign investment, there is no assurance that these
trends will continue. Overt unemployment continues to exist at levels of over three percent
and more than one million new jobs will be required annually according to economic
estimates. The economy has recently witnessed significant increases in energy,
transportation and telecommunications costs and there is significant pressure to increase
wage and energy productivity.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B><I>Smaller Capitalization Risks: </I></B>We may invest in securities without regard to market
capitalization. Investments in securities of smaller companies may be subject to more abrupt or
erratic market movements then larger, more established companies, because these securities
typically are traded in lower volume and issuers are more typically subject to changes in earnings
and future earnings prospects.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B><I>Borrowing Risks: </I></B>Because we may borrow money from banks or other financial institutions to
purchase securities, commonly referred to as &#147;leveraging,&#148; our exposure to fluctuations in the
prices of these securities is increased in relation to our capital. Our borrowing activities will
exaggerate any increase or decrease in our net asset value. In addition, the interest which we must
pay on borrowed money, together with any additional fees to maintain a line of credit or any
minimum average balances required to be maintained, are additional costs which will reduce or
eliminate any net investment profits. Unless profits on assets acquired with borrowed funds exceed
the costs of borrowing, the use of borrowing will diminish our investment performance compared with
what it would have been without borrowing.
</DIV>
</DIV>


<P align="center" style="font-size: 10pt">10
</DIV>
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<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">
<P>
<DIV style="width: 100%; border: 1px solid black; padding: 11px;">



<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B><I>High Portfolio Turnover Rate Risk: </I></B>Our portfolio management may result in high turnover rates
which may increase our short-term capital appreciation and increase brokerage commission costs. If
we have a higher portfolio turnover rate, then our performance could be negatively impacted due to
the increased expenses incurred as a result of the higher brokerage commissions. Rapid portfolio
turnover also exposes stockholders to a higher current realization of capital gains and this could
cause you to pay higher taxes.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B><I>Credit Risk: </I></B>Debt obligations are generally subject to the risk that the issuer may be unable
to make principal and interest payments when they are due. There is also the risk that the
securities could lose value because of a loss of confidence in the ability of the borrower to pay
back debt. Non-investment grade debt &#151; also known as &#147;high-yield bonds&#148; and &#147;junk bonds&#148; &#151; have a
higher risk of default and tend to be less liquid than higher-rated securities.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B><I>Interest Rate Risk: </I></B>Fixed income securities are subject to the risk that the securities could
lose value because of interest rate changes. For example, bonds tend to decrease in value if
interest rates rise. Debt obligations with longer maturities sometimes offer higher yields, but are
subject to greater price shifts as a result of interest rate changes than debt obligations with
shorter maturities.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B><I>Initial Public Offerings Risks: </I></B>We may purchase securities of companies in initial public
offerings. Special risks associated with these securities may include a limited number of shares
available for trading, unseasoned trading, lack of investor knowledge of the company and limited
operating history. These factors may contribute to substantial price volatility for the shares of
these companies. The limited number of shares available for trading in some initial public
offerings may make it more difficult for the us to buy or sell significant amounts of shares
without unfavorable impact on prevailing market prices. Some companies in initial public offerings
are involved in relatively new industries or lines of business, which may not be widely understood
by investors. Some of these companies may be undercapitalized or regarded as developmental stage
companies without revenues or operating income, or the near-term prospects of achieving them.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B><I>Restricted Securities Risks: </I></B>We may invest in securities that are subject to restrictions on
resale, such as Rule&nbsp;144A securities. Rule&nbsp;144A securities are securities that have been privately
placed but are eligible for purchase and sale by certain qualified institutional buyers under Rule
144A under the Securities Act of 1933. Under the supervision of the Board of Directors, we will
determine whether securities purchased under Rule&nbsp;144A are illiquid. Our ability to invest in
illiquid securities is limited to 15% of our total assets. If it is determined that qualified
institutional buyers are unwilling to purchase these securities, the percent of our assets invested
in illiquid securities would increase.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B><I>Shares of Other Investment Companies: </I></B>We may invest in shares of other investment companies as
a means to pursue our investment objective. As a result of this policy, your cost of investing
will generally be higher than the cost of investing directly in the underlying investment company
shares. You will indirectly bear fees and expenses charged by the underlying investment companies
in addition to our direct fees and expenses. Furthermore, the use of this strategy could affect
the timing, amount and character of distributions to you and therefore may increase the amount of
taxes payable by you.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B><I>Discount Risk: </I></B>Historically, our shares, as well as those of other closed-end investment
companies, have frequently traded at a discount to their NAV, which discount often fluctuates over
time. See &#147;Financial Highlights&#148;.
</DIV>
</DIV>




<P align="center" style="font-size: 10pt">11
</DIV>

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<DIV style="font-family: 'Times New Roman',Times,serif">



<DIV align="left">
<A name="106"></A>
</DIV>

<DIV align="left" style="font-size: 12pt; margin-top: 12pt"><B>Preference Common Stock Rights Offering</B>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><B>Purpose of Offering/Use of Proceeds</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As of July&nbsp;31, 2005, portfolio sales have resulted in the probability that we will be
required, under Subchapter M of the Code, to distribute the capital gains realized on such sales to
our stockholders. We are required to distribute at least 98% of the our realized capital gains, if
any, for the one-year period ending on October&nbsp;31 of each calendar year. If we do not distribute
any realized capital gains by January&nbsp;31, 2006, we will not be able to meet the Subchapter M
requirements with respect to calendar year 2005. We are making this offering to raise cash to
permit us to meet our distribution requirements of capital gains realized, if any, in an effort (i)
to avoid an excise tax and to meet our Subchapter M requirements and (ii)&nbsp;to avoid having to sell
portfolio securities which would further decrease the Fund&#146;s assets to invest and would result in
additional realized capital gains.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Any remaining proceeds, after meeting our current distribution requirements, will be invested
in accordance with the Fund&#146;s investment objectives and policies as stated herein. It is
anticipated that such remaining proceeds will be invested in equity and convertible securities
issued by Mexican companies and securities of Mexican issuers.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>General</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Each of our stockholders as of the Record Date shall receive, at no cost, 0.75 nontransferable
rights ( each whole right, a &#147;Subscription Right&#148;) to purchase one share of Preference Stock for
each share of our common stock such stockholder owns as of the Record Date (the &#147;Primary Right&#148;).
We will not issue fractional shares of our common stock upon the exercise of Rights. The number of
Rights issued to Record Date stockholders will be rounded down to the nearest whole number of
Rights. We intend to offer shares of Preference Stock to these stockholders for a price (the
&#147;Subscription Price&#148;) equal to the greater of (a)&nbsp;90% of the Fund&#146;s net asset value per share
(&#147;NAV&#148;) as determined on the Expiration Date or (b)&nbsp;the average closing price of our common stock
as of the Expiration Date. The &#147;average closing price&#148; of our common stock shall be calculated as
an average of the last reported sale prices of a share of our common stock on the NYSE over the
four consecutive trading days ending on the Expiration Date. The offer to purchase Preference Stock
will expire at 5:00 p.m., New York City time, on &#091;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#093;, 2005, unless we decide to extend
it to some later date (the &#147;Expiration Date&#148;).
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Fund announced the offer after the close of trading on the NYSE on &#091;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#093;,
2005. The NAV per share of our common stock at the close of business on &#091;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#093;, 2005
(the last trading date on which the Fund publicly reported its NAV prior to the announcement) and
on &#091;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#093;, 2005 (the last trading date on which the Fund publicly reported its NAV
prior to the date of this Prospectus) was $&#091;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#093; and $&#091;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#093;, respectively, and the
last reported sales price of a share of our common stock on the NYSE on those dates was $&#091;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&#093; and $&#091;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#093;, respectively.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Because we will not determine the actual Subscription Price until the Expiration Date,
stockholders who wish to purchase Preference Stock pursuant to their Rights will not know the
Subscription Price per share at the time they elect to purchase the Preference Stock. As a result,
we are requiring that stockholders deliver an estimated Subscription Price of &#091;$&#95;&#95;&#95;&#093; per share. If
the actual Subscription Price is lower, excess payments will be refunded without interest, and if
the actual Subscription Price is higher, stockholders purchasing Preference Stock must make an
additional payment with 5 business days of the Expiration Date to get the full number of shares.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The purpose of setting the determination of the Subscription Price upon the expiration of the
offer is to attract the maximum participation of stockholders in the offer, with minimum dilution
to nonparticipating stockholders.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;All questions as to the validity, form, eligibility (including time of receipt), payment and
acceptance for payment of any Preference Stock will be determined by us, in our sole discretion,
which determination shall be final and binding. We reserve the absolute right to reject any and
all requests for participation in this offering and to issue a lower number of shares of Preference
Stock, with our only obligation being to return any excess payment without
</DIV>

<P align="center" style="font-size: 10pt">12
</DIV>

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<DIV style="font-family: 'Times New Roman',Times,serif">
<DIV align="left" style="font-size: 10pt; margin-top: 6pt">interest. We shall be under no duty to give notification of any defects or irregularities in
any request for participation in this offering, nor shall we incur any liability for failure to
give any such notification.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>Description of Preference Stock</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Preference Stock is a new class of our common stock designated by the Board specifically
for issuance pursuant to this offering. The Preference Stock has <U><B>identical</B></U> rights, voting
powers and qualifications of our common stock and is <U><B>indistinguishable</B></U> from our common
stock, except as set forth in paragraphs (a)&nbsp;and (b)&nbsp;below (See &#147;Description of our Capital
Stock&#148;):
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt; margin-left: 3%">(a) <U>Repurchase</U>. On a semi-annual basis, on dates to be determined by the Board of
Directors and beginning within the 6&nbsp;month period between January&nbsp;31, 2006 and July&nbsp;31,
2006, the Fund will conduct special Tender Offers for Preference Stock as further described
in &#147;Semi-Annual Tender Offer&#148; below.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt; margin-left: 3%">(b) <U>Automatic Conversion</U>. If the Put Warrant Program (as described below) is
approved by the SEC, the Preference Stock will automatically convert into common stock on a
one-to-one basis upon the anticipated issuance of put warrants by the Fund, and, shortly
thereafter, stockholders will receive put warrants. Holders of the Preference Stock will
have no other conversion rights. See &#147;Put Warrant Program&#148; below.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>Over-Subscription Privilege</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If you elect to purchase the maximum amount of our Preference Stock that you are entitled to
purchase pursuant to your Primary Right, you will also be entitled to subscribe, subject to
allotment, to purchase additional shares of our Preference Stock, if any, that are not purchased by
our other stockholders pursuant to their Primary Right as of the Expiration Date (the
&#147;Over-Subscription Privilege&#148;). If the number of shares of our Preference Stock available for sale
pursuant to the Over-Subscription Privilege is not sufficient to satisfy in full all subscriptions
submitted for additional shares, we will allocate any available shares pro rata among stockholders
who exercise their Over-Subscription Privilege in proportion to the number of shares each
stockholder subscribing for additional shares was entitled to and elected to purchase under his or
her Primary Right; up to the number of additional shares that the stockholder subscribed for
pursuant to the exercise of his or her Over-Subscription Privilege, rounded down to the nearest
whole share.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Banks, brokers, trustees and other nominee holders of Rights will be required to certify to
the Subscribing Agent, before any Over-Subscription Privilege may be exercised with respect to any
particular beneficial owner, as to the aggregate number of Subscription Rights exercised and the
number of Preference Stock subscribed for pursuant to the Over-Subscription Privilege by such
beneficial owner and that such beneficial owner&#146;s Primary Right was exercised in full. &#147;Nominee
Holder Over-Subscription Forms&#148; and &#147;Beneficial Owner Election Forms&#148; will be distributed to banks,
brokers, trustees and other nominee holders with the &#147;Preference Common Stock Purchase Forms.&#148;
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We have been advised that the directors who own shares of our common stock intend to exercise
all of the Rights initially issued to them. If additional shares of Preference Stock remain after
all over-subscriptions exercised by stockholders other than the directors are honored in full, the
directors may, on the Expiration Date, purchase all or any of the remaining shares of Preference
Stock on the same terms offered to all stockholders.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>Semi-Annual Tender Offer</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Fund will conduct a series of tender offers for the Preference Stock only (a &#147;Tender
Offer&#148;) on a semi-annual basis (each semi-annual period, a &#147;Tender Period&#148;), on dates to be
determined by the Board of Directors and beginning within the 6&nbsp;month period between January&nbsp;31,
2006 and July&nbsp;31, 2006, in which 25% of the issued and outstanding Preference Stock as of the date
the Preference Stock is issued may be tendered to the Fund and repurchased for the Fund&#146;s portfolio
securities. Each stockholder participating in a Tender Offer may have his or her tendered shares of
Preference Stock repurchased by the Fund in kind for portfolio securities having a value equal to
99% of NAV as determined, with respect to each Tender Offer, on a date designated by the Board.
</DIV>

<P align="center" style="font-size: 10pt">13
</DIV>

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<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Fund may pay cash for fractional shares of securities; or round off (up or down)
fractional shares so as to eliminate them prior to distribution.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We intend to file an exemptive application with the Division of Investment Management of the
SEC seeking the ability of stockholders who are &#147;affiliated persons&#148; of the Fund solely by reason
of owning, controlling or holding with the power to vote 5% or more of our common stock to have
their Preference Stock repurchased by the Fund for portfolio securities pursuant to the Tender
Offers. We cannot assure you that the SEC will grant our request for exemptive relief. If the SEC
does not grant relief pursuant to the exemptive application, we will pay such 5% holders cash for
their Preference Stock tendered.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Although the intention of the Board is to conduct a semi-annual Tender Offer in which 25% of
the issued and outstanding Preference Stock may be tendered to the Fund and repurchased for the
Fund&#146;s portfolio securities, the Board may, in its sole discretion, direct the Fund to conduct a
Tender Offer for less than 25% of the issued and outstanding Preference Stock. For example, if the
SEC does not grant our request for exemptive relief as explained above, the Fund will be required
to pay the 5% holders cash for their Preference Stock. In such a case, the Fund may not have enough
cash to pay such holders if the Tender Offer is conducted for 25% of the issued and outstanding
Preference Stock. In order to avoid this dilemma, the Fund may reduce the Tender Offer to as little
as 5% of the issued and outstanding Preference Stock. In no event, except in the event of a Tender
Termination Event (as defined below), shall any Tender Offer be conducted in which less than 5% of
the issued and outstanding Preference Stock may be tendered to the Fund.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Each Tender Offer shall be governed by substantially the same terms and conditions that
governed the Fund&#146;s previous tender offer which commenced on February&nbsp;19, 2002 and expired on March
20, 2002. See &#147;Share Repurchases.&#148;
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In the event that the average trade weighted discount to the last published NAV per Fund share
is less than 5% for any five consecutive trading days during any Tender Period (a &#147;Tender
Termination Event&#148;), the Fund will not conduct a Tender Offer during that Tender Period. In the
event of a Tender Termination Event, a Tender Offer will be conducted during the next Tender Period
(unless a Tender Termination Event exists during such next Tender Period).
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We normally publish our NAV on the last business day of each week (generally Friday) at the
close of regular trading on the NYSE. The NAV per Fund share is available daily through the
Administrator by calling toll free 888-294-8217. As an example, the NAV per Fund share on &#091;<U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U> <U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U>, 2005 was $<U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U>&#093;.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>Put Warrant Program</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In 2001, the Fund&#146;s Board of Directors approved the creation and registration of a put warrant
program (the &#147;Put Warrant Program&#148;) whereby the Fund would issue without charge one put warrant for
each whole share of common stock issued by the Fund held by each stockholder of record as of a date
selected by our Board. As envisioned, each put warrant would allow our stockholders to &#147;put&#148;
(sell)&nbsp;on a quarterly basis one share of our common stock to us for an amount of cash equal to our
NAV per share. Our Board believes that the Put Warrant Program would give a holder the ability to
realize NAV without us incurring the substantial expenses associated with conducting a traditional
tender offer pursuant to the requirements contained in the Securities Exchange Act of 1934, as
amended (the &#147;Exchange Act&#148;).
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In March&nbsp;2004, we filed a No-Action Request Letter with the SEC&#146;s Division of Corporate
Finance, and, in May&nbsp;2004, we filed an exemptive application with the Division of Investment
Management seeking the ability to issue and register the put warrants. To date, we have received
no definitive answer on whether the Fund may administer the Put Warrant Program from either
Division of the SEC, and there is no guarantee that the SEC will decide to grant exemptive relief.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In the event the Put Warrant Program is approved by the SEC, and upon the anticipated issuance
of put warrants by the Fund, all issued and outstanding shares of Preference Stock will
automatically convert to common stock on a one-to-one basis, and, shortly thereafter, stockholders
will receive put warrants.
</DIV>

<P align="center" style="font-size: 10pt">14
</DIV>

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<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>Asset Coverage</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Immediately following the issuance of the Preference Stock to purchasing stockholders and in
accordance with the rules promulgated under the 1940 Act, the Fund shall have an asset coverage of
at least 200&nbsp;percent.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>No Fractional Shares</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We will not issue fractional shares of our common stock upon the exercise of Rights. The
number of Rights issued to Record Date stockholders will be rounded down to the nearest whole
number of Rights.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>Non-Transferability of Rights</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Rights granted in this offer are non-transferable. If you do not exercise them, you give
up any right to the underlying shares of Preference Stock.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>Expiration Date of the Offering</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;You may elect to purchase Preference Stock pursuant to your Primary Right and/or
Over-Subscription Privilege at any time before 5:00 p.m., New York City time, on &#091;<u>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</u>&#093;,
2005 (the &#147;Expiration Date&#148;). The Board reserves the right to extend the date upon which the
Rights expire. If you do not elect to purchase Preference Stock pursuant to your Rights before the
time they expire, then your Rights will be null and void. We will not be obligated to honor your
election to purchase Preference Stock if we receive the documents relating to your purchase of
Preference Stock or collect your payment after the time they expire, regardless of when you
transmitted the documents. See &#147;Receipt of Payment&#148; below.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Any extension of the offer will be followed as promptly as practicable by announcement
thereof, and in no event later than 9:00 a.m., New York City time, on the next business day
following the previously scheduled Expiration Date. Without limiting the manner in which the Fund
may choose to make such announcement, the Fund will not, unless otherwise required by law, have any
obligation to publish, advertise or otherwise communicate any such announcement other than by
making a release to the Dow Jones News Service or such other means of announcement as the Fund
deems appropriate.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Although we have no present intention to do so, we may, in the future and in our discretion,
choose to make additional offerings from time to time for a number of shares and on terms which may
or may not be similar to this offer. Any such future offering will be made in accordance with the
1940 Act.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>Distribution Arrangements</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We do not intend to engage a dealer manager for the offer. Our officers and directors may
solicit the exercise of Rights by our stockholders. The offer is not contingent on any number of
Rights being exercised, and we will pay all expenses incurred in connection with the offer.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>Election to Purchase Preference Stock</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;You may elect to purchase Preference Stock by delivering the following to the Subscribing
Agent at or before the Expiration Date:
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>your properly completed and signed Preference Common Stock Purchase Form, with
any required signature guarantees, evidencing those rights with any other supplemental
documentation; and</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>your payment in full of the Subscription Price for each share of our Preference
Stock that you choose to subscribe for under your Subscription Rights and your
Over-Subscription Privilege.</TD>
</TR>

</TABLE>
</DIV>
<P align="center" style="font-size: 10pt">15
</DIV>

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<DIV style="font-family: 'Times New Roman',Times,serif">


<DIV style="margin-top: 6pt"><TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">



</TABLE>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>Method of Payment</B>
</DIV>


<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Your payment of the Subscription Price must be made by either:</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>check or bank draft drawn upon a U.S. bank or postal, telegraphic, or express
money order payable to: &#091;&#147;The Mexico Equity and Income Fund, Inc.&#148;&#093;; or</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>wire transfer of immediately available funds to the account maintained by the
&#091;Subscribing Agent&#093; for such purpose at: &#091; &nbsp;&nbsp;&#093;.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>If you hold our common stock through a nominee holder, you will need to have
your broker, custodian bank or other nominee act for you. To indicate your decision with
respect to your rights, you should complete and return to your broker, custodian bank or
other nominee the &#147;Beneficial Owner Election Form&#148; with proper payment.</TD>
</TR>

</TABLE>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>Receipt of Payment</B>
</DIV>


<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Your payment of the Subscription Price will be deemed to have been received by us only upon:</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>clearance of any uncertified check;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>receipt by us of any certified check or bank draft drawn upon a U.S. bank or
any postal, telegraphic or express money order; or</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>receipt of collected funds in our account designated above.</TD>
</TR>

</TABLE>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>Clearance of Uncertified Checks</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;You should note that funds paid by uncertified personal checks may take 5 business days or
more to clear. If you wish to pay the Subscription Price by an uncertified personal check, we
recommend that you make payment at least 10&nbsp;days in advance of the Expiration Date to ensure that
your payment is received and clears by that time<B>. If your check does not clear before the
Expiration Date, you will not receive any shares of Preference Stock, and our only obligation will
be to return your subscription payment, without interest. It is safer to use a certified or
cashier&#146;s check, money order or wire transfer of funds to avoid missing the opportunity to purchase
Preference Stock.</B>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>Delivery of Subscription Materials and Payment</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;You should deliver the &#147;Preference Common Stock Purchase Form&#148; and payment of the Subscription
Price, as well as any other subscription documentation as follows:
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>If by Mail, Hand Delivery or Overnight Delivery, to:</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">Computershare Trust Company of New York<BR>
88 Pine Street &#151; 19th Floor<BR>
New York NY 10005<BR>
Attn: <U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U>Dept.

</DIV>
<DIV align="left" style="font-size: 10pt; margin-top: 6pt">For additional information, you may call the Subscribing Agent at (800)&nbsp;245-7630.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>Calculation of Preference Stock Purchased</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If you do not indicate the number of shares of Preference Stock being subscribed for, or do
not forward full payment of the aggregate Subscription Price for the number of shares of Preference
Stock that you indicate are
</DIV>

<P align="center" style="font-size: 10pt">16
</DIV>

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<DIV style="font-family: 'Times New Roman',Times,serif">
<DIV align="left" style="font-size: 10pt; margin-top: 6pt">subscribed for, then you will be deemed to have purchased the maximum number of shares of the
Preference Stock that may be purchased for the payment that you delivered to our Subscribing Agent.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>Funds Will Be Held by our Subscribing Agent until Shares of Preference Stock Are Issued</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our Subscribing Agent will hold your payment in a segregated account with other payments
received from stockholders until we issue to you your shares of our Preference Stock.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>Notice to Nominee Holders</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If you are a broker, a trustee or a depositary for securities who holds shares of our common
stock for the account of others as of the Record Date, you should notify the respective beneficial
owners of the shares about the rights offering as soon as possible to find out their intentions.
You should obtain instructions from the beneficial owner with respect to the rights by using the
&#147;Beneficial Owner Election Form&#148; and instructions that we have provided to you for your
distribution to beneficial owners. If the beneficial owner so instructs, you should complete the
appropriate &#147;Preference Common Stock Purchase Form&#148; and, in the case of the Over-Subscription
Privilege, the related &#147;Nominee Holder Over-Subscription Form,&#148; and submit them to our Subscribing
Agent with the proper payment.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>Notice to Beneficial Owners Whose Shares are Held by a Broker or Nominee</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If you are a beneficial owner of shares of our common stock or rights that you hold through a
nominee holder, we will ask your broker, custodian bank or other nominee to notify you of this
offering. If you wish to purchase Preference Stock, you will need to have your broker, custodian
bank or other nominee act for you. To indicate your decision with respect to your rights, you
should complete and return to your broker, custodian bank or other nominee the &#147;Beneficial Owner
Election Form&#148;. You should receive this form from your broker, custodian bank or other nominee
with the other rights offering materials. We suggest that you contact your broker or other nominee
to be sure that they are sending you the election form without delay. <B>If you are giving
instructions to your nominee, you should act promptly to allow a sufficient amount of time to
ensure that the nominee can act to follow your instructions in time.</B>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>Notice of NAV Decline</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Fund, as required by the SEC&#146;s registration form, will suspend the offer until it
amends this Prospectus if, subsequent to the date of this Prospectus, the Fund&#146;s NAV declines more
than 10% from its NAV as of that date. Accordingly, the Expiration Date would be extended and the
Fund would notify Record Date stockholders of the decline and permit stockholders to cancel their
exercise of Rights.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>Determinations Regarding the Election to Purchase Preference Stock</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We will decide all questions concerning the timeliness, validity, form and eligibility of your
election to purchase Preference Stock. Our decisions will be final and binding. We, in our sole
discretion, may waive any defect or irregularity, or permit a defect or irregularity to be
corrected within such time as we may determine. We may reject the election to purchase Preference
Stock because of any defect or irregularity. Your election will not be deemed to have been
received or accepted until all irregularities have been waived by us or cured by you within such
time as we decide, in our sole discretion.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Neither we nor our Subscribing Agent will be under any duty to notify you of a defect or
irregularity. We will not be liable for failing to give you any such notice. We reserve the right
to reject your election to purchase Preference Stock if your election is not in accordance with the
terms of the offering or in proper form. We will also not accept your election to purchase
Preference Stock if our issuance of shares of our Preference Stock upon your election could be
deemed unlawful or materially burdensome.
</DIV>

<P align="center" style="font-size: 10pt">17
</DIV>

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<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>Questions About Subscribing for Preference Stock</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;You may direct any questions or requests for assistance concerning the method of subscribing
for Preference Stock, the instructions, the purchase form or other documentation referred to
herein, and requests for additional copies of this Prospectus to the Subscribing Agent at the
following telephone number and address:
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">Computershare Trust Company of New York<BR>
88 Pine Street &#151; 19th Floor<BR>
New York NY 10005<BR>
Toll Free (800)&nbsp;245-7630

</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>Termination</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We may terminate this offering at any time prior to the Expiration Date. If we terminate the
offering, our only obligation to you will be to return your subscription payment to you, without
interest.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>Effects of this Offer on the Fund Adviser</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our investment adviser will benefit from this offer because a portion of the investment
management fee we pay to the investment adviser is based on our gross assets. See &#147;Investment
Advisory Agreement.&#148; It is not possible to state precisely the amount of additional compensation
the investment adviser will receive as a result of this offer because it is not known how many
shares of Preference Stock will be subscribed for. However, assuming (i)&nbsp;all Rights are exercised,
(ii)&nbsp;the average value of our gross assets remains between $&#091;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#093; million and $&#091;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#093; million,
and (iii)&nbsp;the Subscription Price is $&#091;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#093; per share, and after giving effect to expenses
related to this offer, the investment adviser would receive additional annualized advisory fees of
$&#091;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#093; and the amount of the administrative fee received would be an additional fee of $&#091;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#093;. Maria Eugenia Pichardo, President of the Fund, is also an officer and owner of our investment
adviser. None of our directors who approved this offer are affiliated with the investment adviser.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>No Recommendations to Holders</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;WE MAKE NO RECOMMENDATION TO ANY PERSON TO PARTICIPATE IN THIS OFFERING, AND WE HAVE NOT
AUTHORIZED ANY PERSON TO MAKE ANY SUCH RECOMMENDATION. POTENTIAL HOLDERS ARE URGED TO EVALUATE
CAREFULLY ALL INFORMATION IN THE REGISTRATION STATEMENT, CONSULT THEIR OWN INVESTMENT AND TAX
ADVISORS AND MAKE THEIR OWN DECISIONS WHETHER OR NOT TO PARTICIPATE IN THIS OFFERING.
</DIV>
<DIV align="left">
<A name="107"></A>
</DIV>

<DIV align="left" style="font-size: 12pt; margin-top: 12pt"><B>Material United States Federal Income Tax Consequences</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The following discussion is a summary of certain material U.S. federal income tax
consequences to a typical &#147;U.S. holder&#148; (defined below) that Receives rights pursuant to this
offering and that either (i)&nbsp;exercises such Rights, (ii)&nbsp;allows such Rights to expire, or (iii)
sells, exchanges, redeems or otherwise disposes of such Rights.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;This discussion is based on current provisions of the Internal Revenue Code of 1986, as
amended, which we refer to as the &#147;Code,&#148; applicable current, temporary and proposed Treasury
regulations promulgated thereunder, which we refer to as the &#147;Treasury Regulations,&#148; the
legislative history of the Code and publicly available administrative and judicial interpretations
thereof, all as in effect of the date of this prospectus and all of which are subject to change,
possibly with retroactive effect, or to different interpretations. In addition, the administrative
interpretations and practices of the Internal Revenue Service include its practices and policies as
expressed in private letter rulings which are not binding on the Internal Revenue Service, except
with respect to the particular taxpayers who requested and received these rulings. This discussion
is included for general information purposes only and does not purport to be a complete technical
analysis or listing of all potential tax considerations that may be relevant to U.S. holders in
light of their particular circumstances. This discussion does not address any state, local or
foreign
</DIV>

<P align="center" style="font-size: 10pt">18
</DIV>

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<DIV style="font-family: 'Times New Roman',Times,serif">
<DIV align="left" style="font-size: 10pt; margin-top: 6pt">tax consequences or any non-income tax consequences (such as estate or gift tax consequences).
This discussion applies only to U.S. holders that hold shares of our common stock as capital
assets and that will hold the Rights distributed pursuant to this offering as capital assets (and,
in the event such rights are exercised, will hold newly acquired shares of our common stock as
capital assets), in each case, within the meaning of Section&nbsp;1221 of the Code. This discussion
also does not address the United States federal income tax consequences to a U.S. holder that is
one of our affiliates or that is subject to special rules under the Code, including but not limited
to:
</DIV>


<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>A financial institution, insurance company, or regulated investment company;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Persons who are subject to alternative minimum tax;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>A tax-exempt organization, retirement plan, or mutual fund;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>A dealer, broker, or trader in securities;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Non-U.S. holders (as defined below);</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>An entity treated as a partnership for U.S. federal income tax purposes;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>A stockholder that owns its shares of our common stock indirectly through an entity
treated as a partnership for United States federal income tax purposes, or a trust or
estate;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Persons deemed to sell their shares of common stock under the constructive sale
provisions of the Code;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>A stockholder that holds its shares of our common stock as part of a hedge,
appreciated financial position, straddle or conversion transaction; or</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>A stockholder that acquired our common stock pursuant to the exercise of
compensatory stock options or otherwise as compensation.</TD>
</TR>

</TABLE>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We will not seek a ruling from the Internal Revenue Service, or the &#147;IRS,&#148; with respect to the
rights offering. The IRS could take positions concerning the tax consequences of this offering that
are different from those described in this discussion, and, if litigated, a court could sustain any
such positions taken by the IRS.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;For purposes of this discussion, the term &#147;U.S. holder&#148; means a holder of shares of our common
stock that, for U.S. federal income tax purposes, is:
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>A citizen or resident of the U.S.;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>A corporation or other entity treated as a corporation for U.S. federal income tax
purposes created or organized in the U.S. or under U.S. laws or the laws of any state
or political subdivision thereof;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>An estate the income of which is subject to U.S. federal income taxation regardless
of its source; or</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>A trust (i)&nbsp;if, in general, a court within the U.S. is able to exercise primary
jurisdiction over its administration and one or more U.S. persons have authority to
control all of its substantial decisions or (ii)&nbsp;that has a valid election in effect
under applicable Treasury Regulations to be treated as a U.S. person.</TD>
</TR>

</TABLE>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A &#147;non-U.S. holder&#148; is a holder other than a U.S. holder. If a holder of our common stock is
a non-U.S. holder, the tax consequences of the rights offering to such holder will depend upon a
variety of factors, including
</DIV>

<P align="center" style="font-size: 10pt">19
</DIV>

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<DIV style="font-family: 'Times New Roman',Times,serif">
<DIV align="left" style="font-size: 10pt; margin-top: 6pt">whether such person conducts a trade or business in the U.S. Non-U.S. holders are urged to
consult their own tax advisors regarding the tax consequences associated with the rights offering.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><B>Holders of our common stock are urged to consult their own tax advisors regarding the specific tax
consequences associated with the rights offering, including the applicability and effect of any
state, local, foreign, or other tax laws as well as changes in applicable tax laws.</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>Distribution of Rights</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We believe that pursuant to Section&nbsp;305 of the Code and the Treasury Regulations issued
thereunder, a U.S. holder that receives Rights pursuant to this offering should not be required to
recognize taxable income for U.S. federal income tax purposes upon the receipt of such Rights.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We intend to report this offering accordingly. However, if our intended treatment of the
Rights were challenged by the IRS and if such challenge were ultimately upheld, the U.S. federal
income tax consequences to a U.S. holder that receives Rights pursuant to this offering may differ
from the consequences described herein, and it is possible that a U.S. holder&#146;s receipt of Rights
or a portion thereof pursuant to this offering may be taxable.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>Basis and Holding Period of Rights</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If, in accordance with Section&nbsp;307 of the Code, if the fair market value of the Rights which
we distribute to U.S. holder is less than 15% of the fair market value of such U.S. holder&#146;s shares
of our common stock with respect to which such Rights were distributed, such U.S. holder&#146;s basis in
the Rights distributed generally will be zero. A U.S. holder may elect, however, to allocate its
basis in our common stock between such common stock and the Rights received in proportion to the
fair market value of such common stock and such Rights. This election may be made pursuant to
Section&nbsp;307 of the Code and the Treasury Regulations thereunder and will be irrevocable once made.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If the fair market value of the Rights which we distribute to a U.S. holder is 15% or more of
the fair market value of such U.S. holder&#146;s shares of our common stock with respect to which such
Rights were distributed, such U.S. holder will be required to allocate its basis between such
commons tock and such Rights in proportion to their relative fair market values.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In either case, a U.S. holder&#146;s holding period for the Rights that we distribute will include
the holding period of such U.S. holder&#146;s shares of our common stock with respect to which such
Rights were distributed.
</DIV>
<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><B>Exercise of Rights; Basis and Holding Period of Acquired Shares; Sale, Exchange, Redemption or
Other Disposition of Acquired Shares</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A U.S. holder will not recognize gain or loss upon the exercise of the Rights. A U.S.
holder&#146;s basis in our Preference Stock acquired through exercise of the Rights generally will equal
the sum of (i)&nbsp;the Subscription price paid by such U.S. holder to acquire such stock and (ii)&nbsp;such
U.S. holder&#146;s basis, if any, in the Rights exercised. A U.S. holder&#146;s holding period in shares of
our Preference Stock acquired through the exercise of Rights will begin on the day such U.S. holder
exercises the Rights.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Upon the sale, exchange, redemption or other disposition of the Preference Stock acquired upon
the exercise of Rights, a U.S. holder generally will recognize gain or loss equal to the difference
between the amount realized and such U.S. holder&#146;s basis in such Preference Stock. Such gain or
loss will be capital gain or loss and will be long-term capital gain or loss if a U.S. holder&#146;s
holding period exceeds one year at the time of the sale, exchange or other disposition. The
deductibility of capital losses is subject to limitations.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>Expiration of Rights</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If a U.S. holder receives Rights pursuant to this offerings, and such U.S. holder&#146;s basis in
our common stock is not allocated between such common stock and the Rights received and such U.S.
holder&#146;s Rights expire
</DIV>

<P align="center" style="font-size: 10pt">20
</DIV>

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<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">
<DIV align="left" style="font-size: 10pt; margin-top: 6pt">unexercised, then such U.S. holder will not recognize taxable loss upon expiration of the
Rights. In addition, such U.S. holder&#146;s basis in its shares of our common stock will not be
affected by this offering and such U.S. holder&#146;s decision to allow its Rights to expire and will
remain the same as before this offering.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If a U.S. holder receives Rights pursuant to this offering, and such U.S. holder&#146;s basis in
our common stock is allocated between such a common stock and the Rights received and such U.S.
holder&#146;s Rights expire unexercised, then such U.S. holder will recognize a taxable loss upon the
expiration of the Rights equal to the basis that was allocated to the Rights. Such loss will be a
capital loss.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>Backup Withholding</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A U.S. holder that sells, exchanges, redeems or otherwise disposes shares of our Preference
Stock acquired upon the exercise of Rights or that sells, exchanges or otherwise disposes of Rights
may be subject to backup withholding on the proceeds received, unless such U.S. holder:
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Is a corporation or other exempt recipient and, when required, establishes this
exemption; or</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Provides a correct taxpayer identification number, certifies that it is not
currently subject to backup withholding, and otherwise complies with the applicable
requirements of the backup withholding rules.</TD>
</TR>

</TABLE>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Backup withholding is not an additional tax. Any amount withheld under the backup withholding
rules will generally be creditable against the United States federal income tax liability of a U.S.
holder if appropriate information is provided to the IRS. If a U.S. holder does not provide the
appropriate party with the correct taxpayer identification number or any other proper document or
certification required by the IRS (generally a Form W-9 in the case of a U.S. holder), such U.S.
holder may be subject to penalties imposed by the IRS.
</DIV>
<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><B>THE FOREGOING DOES NOT PURPORT TO BE A COMPLETE ANALYSIS OF THE POTENTIAL TAX CONSIDERATIONS
RELATING TO THIS OFFERING AND IS NOT TAX ADVICE. THEREFORE, HOLDERS OF OUR COMMON STOCK ARE URGED
TO CONSULT THEIR TAX ADVISORS AS TO THE SPECIFIC TAX CONSEQUENCES TO THEM OF THIS OFFERING,
INCLUDING THE APPLICABILITY OF FEDERAL, STATE, LOCAL, FOREIGN AND OTHER TAX LAWS.</B>
</DIV>


<P align="center" style="font-size: 10pt">21
</DIV>

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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">



<DIV align="left">
<A name="108"></A>
</DIV>

<DIV align="left" style="font-size: 12pt; margin-top: 12pt"><B>Use of Proceeds</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We intend to use the proceeds of this offering to make required distributions of capital
gains realized on 2005 portfolio sales to our stockholders. We are required to distribute at least
98% of the our realized capital gains, if any, for the one-year period ending on October&nbsp;31 of each
calendar year. See &#147;Preference Common Stock Rights Offering &#151; Purpose of Offering/Use of Proceeds.&#148;
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Any remaining proceeds, after meeting our current distribution requirements, will be invested
in accordance with the Fund&#146;s investment objectives and policies as stated herein. It is
anticipated that such remaining proceeds will be invested in equity and convertible securities
issued by Mexican companies and debt securities of Mexican issuers.
</DIV>
<DIV align="left">
<A name="109"></A>
</DIV>

<DIV align="left" style="font-size: 12pt; margin-top: 12pt"><B>Price Range of Common Stock</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our common stock is traded on the NYSE under the symbol &#147;MXE.&#148; The following table
lists the high and low closing sales prices for our common stock, and the closing sales price as a
percentage of NAV:
</DIV>
<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="28%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="7"><B>Closing Sales</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="7" style="border-bottom: 1px solid #000000"><B>Price</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>Premium/Discount</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>Premium/Discount</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>of High Sales</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>of Low Sales</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>Declared</B></TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3" style="border-bottom: 1px solid #000000"><B>NAV</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3" style="border-bottom: 1px solid #000000"><B>High</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3" style="border-bottom: 1px solid #000000"><B>Low</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3" style="border-bottom: 1px solid #000000"><B>Price to NAV</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3" style="border-bottom: 1px solid #000000"><B>Price to NAV</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3" style="border-bottom: 1px solid #000000"><B>Dividends</B></TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px"><B><I>Year ended July&nbsp;31, 2004</I></B></DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:45px; text-indent:-15px">First Quarter</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">11.17</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">9.90</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">9.79</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(11.37) </TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(12.35</TD>
    <TD nowrap>)%</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:45px; text-indent:-15px">Second Quarter</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">12.96</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">11.60</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">11.43</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(10.49</TD>
    <TD nowrap>)%</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(11.81</TD>
    <TD nowrap>)%</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">.02</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:45px; text-indent:-15px">Third Quarter</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">13.29</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">12.15</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">11.90</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(8.58</TD>
    <TD nowrap>)%</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(10.46</TD>
    <TD nowrap>)%</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:45px; text-indent:-15px">Fourth Quarter</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">13.66</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">11.73</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">11.73</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(14.13</TD>
    <TD nowrap>)%</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(14.13</TD>
    <TD nowrap>)%</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px"><B><I>Year ended July&nbsp;31, 2005</I></B></DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:45px; text-indent:-15px">First Quarter</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">15.78</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">13.60</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">13.50</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(13.81</TD>
    <TD nowrap>)%</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(14.45</TD>
    <TD nowrap>)%</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:45px; text-indent:-15px">Second Quarter</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">18.45</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">16.33</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">15.98</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(11.49</TD>
    <TD nowrap>)%</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(13.39</TD>
    <TD nowrap>)%</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:45px; text-indent:-15px">Third Quarter</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">17.76</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">15.24</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">15.10</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(14.19</TD>
    <TD nowrap>)%</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(14.98</TD>
    <TD nowrap>)%</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:45px; text-indent:-15px">Fourth Quarter</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">21.27</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">18.82</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">18.54</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(11.52</TD>
    <TD nowrap>)%</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(12.83</TD>
    <TD nowrap>)%</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px"><B><I>Year ending July&nbsp;31, 2006</I></B></DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:45px; text-indent:-15px">First Quarter
(through _____, 2005)</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>

    <TD align="right">%</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>

    <TD align="right">%</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>

<DIV align="left">
<A name="110"></A>
</DIV>

<DIV align="left" style="font-size: 12pt; margin-top: 12pt"><B>Distributions</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We make annual distributions to our stockholders of at least 90% of our ordinary income
and short-term capital gains. Holders of shares of Preference Stock shall have the same
distribution rights as holders of shares of common stock. We will distribute during each calendar
year an amount equal to the sum of (1)&nbsp;at least 98% of our ordinary income for the calendar year,
(2)&nbsp;at least 98% of the Fund&#146;s capital gains in excess of capital losses for the one-year period
ending on October&nbsp;31 of the calendar year and (3)&nbsp;any ordinary income and net capital gains for the
preceding year that were not distributed during such year, in order to avoid excise taxes imposed
on registered investment companies that do not make these distributions. In addition, although we
currently intend to distribute net realized long-term capital gains at least annually, we may in
the future decide to retain such capital gains for investment in accordance with our investment
objective. In such event, the consequences of our retention of net realized long-term capital
gains could be &#091;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#093;, as described in more detail under &#147;Material United States
Federal Income Tax Consequences.&#148; This number could change based on portfolio and economic
conditions. No stockholder should assume that there will be a distribution.
</DIV>


<P align="center" style="font-size: 10pt">22
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>
<DIV style="font-family: 'Times New Roman',Times,serif">


<DIV align="left">
<A name="111"></A>
</DIV>

<DIV align="left" style="font-size: 12pt; margin-top: 12pt"><B>Business of the Fund</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our investment objective is a high total return through capital appreciation and current
income by investing at least 80% of our assets in equity and convertible securities issued by
Mexican companies and debt securities of Mexican issuers.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our investment activities are managed by Pichardo Asset Management, S.A. de C.V. (&#147;PAM&#148;). PAM
is registered as an investment adviser under the Advisers Act. Under PAM&#146;s investment advisory
agreement with us, we have agreed to pay PAM a monthly fee at an annual rate of 0.80% of the value
of our average daily net assets.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;U.S. Bancorp Fund Services, LLC (&#147;Administrator&#148;) serves as our administrator pursuant to an
administrative agreement with the Fund. Administrator is located at 615 East Michigan Avenue,
Milwaukee, WI 53202.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>Fundamental Investment Policies</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Fund has adopted certain fundamental investment restrictions that may not be changed
without the prior approval of the holders of a majority of the Fund&#146;s outstanding voting
securities. For purposes of the restrictions listed below, all percentage limitations apply
immediately after a purchase or initial investment, and any subsequent change in any applicable
percentage resulting from market fluctuations does not require elimination of any security from the
Fund&#146;s portfolio. Fund policies which are not fundamental may be modified by the Directors if, in
the reasonable exercise of the Directors&#146; business judgment, modification is determined to be
necessary or appropriate to carry out the Fund&#146;s objectives. Under its fundamental restrictions,
the Fund may not:
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.&nbsp;invest 25% or more of the total value of its assets in a particular industry; this
restriction does not apply to investments in U.S. Government securities but does apply to
investments in Mexican Government securities;
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.&nbsp;issue senior securities, borrow or pledge its assets, except that the Fund may borrow from
a bank to make distributions required for the Fund to maintain its qualification as a regulated
investment company under U.S. tax law, for temporary or emergency purposes or for the clearance of
transactions in amounts not exceeding 10% (taken at the lower of cost or current value) of its
total assets (not including the amount borrowed) and may also pledge its assets to secure such
borrowings. Additional investments will not be made when borrowings exceed 5% of the Fund&#146;s assets;
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.&nbsp;lend money to other persons except through the purchase of debt obligations and the
entering into of repurchase agreements in the United States or Mexico consistent with the Fund&#146;s
investment objective and policies;
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.&nbsp;make short sales of securities or maintain a short position in any security except for
short sales against the box as a form of hedging;
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.&nbsp;purchase securities on margin, except such short-term credit as may be necessary or routine
for the clearance or settlement of transactions and the maintenance of margin with respect to
forward contracts or other hedging transactions;
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.&nbsp;underwrite securities of other issuers, except insofar as the Fund may be deemed an
underwriter under the Securities Act, in selling portfolio securities;
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.&nbsp;purchase or sell commodities or real estate, except that the Fund may invest in securities
secured by real estate or interests in real estate or in securities issued by companies, including
real estate investment trusts, that invest in real estate or interests in real estate, and may
purchase and sell forward contracts on foreign currencies to the extent permitted under applicable
law; or
</DIV>

<P align="center" style="font-size: 10pt">23
</DIV>

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<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.&nbsp;make investments for the purpose of exercising control over, or management of, the issuers
of any securities.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>Employees</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Gerald Hellerman, our Chief Financial Officer and Chief Compliance Officer, is our only
employee. The officers of the Fund, except for Mr.&nbsp;Hellerman, are employees of our investment
adviser. Our day-to-day investment operations are managed by our investment adviser.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>Legal Proceedings</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Although we may, from time to time, be involved in litigation arising out of our
operations in the normal course of business, we are not currently a party to any pending material
legal proceedings.
</DIV>
<DIV align="left">
<A name="112"></A>
</DIV>

<DIV align="left" style="font-size: 12pt; margin-top: 12pt"><B>Management</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our business and affairs are managed under the direction of our Board. The Board
currently consists of five members, four of whom are not &#147;interested persons&#148; as that term is
defined in Section&nbsp;2(a)(19) of the 1940 Act. We refer to these individuals as our independent
directors. Our Board elects our officers, who serve at the discretion of the Board. The officers
of the Fund, except for Mr.&nbsp;Hellerman, are employees of our investment adviser.
</DIV>

<P align="center" style="font-size: 10pt">24
</DIV>

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<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>Directors and Executive Officers</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our directors and executive officers, their positions, year born and principal occupation
are set forth below. The address for each director and executive officer is c/o U.S. Bancorp Fund
Services, LLC, 615 East Michigan Street, Milwaukee, WI 53202.
</DIV>

<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>INDEPENDENT DIRECTORS</B>
</DIV>

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="27%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="16%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="22%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="20%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center"><B>Other</B></TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center"><B>Position(s)</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center"><B>Principal Occupation(s)</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center"><B>Directorships</B></TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD nowrap align="center"><B>Name and</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center"><B>Held with the</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>Held Office</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center"><B>During</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center"><B>Held by</B></TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD nowrap align="center" style="border-bottom: 1px solid #000000"><B>Age</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" style="border-bottom: 1px solid #000000"><B>Fund</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3" style="border-bottom: 1px solid #000000"><B>Since</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" style="border-bottom: 1px solid #000000"><B>Past 5 Years</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" style="border-bottom: 1px solid #000000"><B>Director</B></TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Glenn Goodstein (1963)
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Class&nbsp;I Director
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">2001</TD>
    <TD nowrap valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Registered investment
adviser; Managing
Member of the General
Partner of Mercury
Partners LP. (an
investment
partnership)
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">None</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Phillip Goldstein (1945)
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Class&nbsp;I Director
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">2000</TD>
    <TD nowrap valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">President, Kimball &#038;
Winthrop, Inc. (an
investment advisory
firm); and general
partner of Opportunity
Partners L.P. (an
investment
partnership)
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Director of
Brantley Capital
Corporation (a
business
development
company); The
Emerging Markets
Telecommunications
Fund (a registered
closed-end
investment company)
and First Israel
Funds (a registered
closed-end
investment Company)</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Rajeev Das (1968)
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Class&nbsp;II Director
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">2001</TD>
    <TD nowrap valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Senior Analyst,
Kimball &#038; Winthrop,
Inc. (an investment
advisory firm)
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">None</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Andrew Dakos (1966)
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Class&nbsp;II Director
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">2001</TD>
    <TD nowrap valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">President and CEO of
Uvitec Printing Ink,
Inc. (an ink and
coating manufacturing
company); Managing
Member of the general
partner of Full Value
Partners L.P. (an
investment
partnership);
President of Elmhurst
Capital, Inc. (an
investment advisory
firm).
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">None</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>INTERESTED DIRECTOR</B>
</DIV>

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="27%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="12%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="21%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="19%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center"><B>Other</B></TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center"><B>Position(s)</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center"><B>Principal Occupation(s)</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center"><B>Directorships</B></TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD nowrap align="center"><B>Name and</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center"><B>Held with the</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>Held Office</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center"><B>During</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center"><B>Held by</B></TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD nowrap align="center" style="border-bottom: 1px solid #000000"><B>Age</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" style="border-bottom: 1px solid #000000"><B>Fund</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3" style="border-bottom: 1px solid #000000"><B>Since</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" style="border-bottom: 1px solid #000000"><B>Past 5 Years</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" style="border-bottom: 1px solid #000000"><B>Director</B></TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Gerald Hellerman (1937)*
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">Class&nbsp;III Director,
Chief Financial
Officer and Chief
Compliance Officer
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">2001</TD>
    <TD nowrap valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Managing Director,
Hellerman Associates
(a financial and
corporate consulting
firm)
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Director, Brantley
Capital Corporation
(a business
development
company); and MVC
Capital, Inc. (a
business
development
company); and
AirNet Systems,
Inc. (a specialty
air courier)</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>



<DIV align="left">
<DIV style="font-size: 3pt; margin-top: 16pt; width: 18%; border-top: 1px solid #000000">&nbsp;</DIV>
</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">
<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96"></TD>
</TR>

<TR valign="top">
    <TD nowrap align="left">*</TD>
    <TD>&nbsp;</TD>
    <TD>Mr.&nbsp;Hellerman is only deemed an interested director because he is an executive officer.</TD>
</TR>

</TABLE>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">Our Board is divided into three classes with each class serving a staggered three year term ending
on the date of our annual meeting as follows: Class&nbsp;I directors&#146; terms expire in the year 2005;
Class&nbsp;II directors&#146; terms expire in 2006; and Class&nbsp;III directors&#146; terms expire in 2007.
</DIV>


<P align="center" style="font-size: 10pt">25
</DIV>

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<DIV style="font-family: 'Times New Roman',Times,serif">




<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>OFFICERS</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In addition to Mr.&nbsp;Hellerman, our only other current executive officer is:
</DIV>
<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="33%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="11%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="30%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center"><B>Directorships</B></TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD nowrap align="center"><B>Name and</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center"><B>Position(s) Held</B></TD>
    <TD nowrap align="center"><B>&nbsp;</B></TD>
    <TD nowrap align="center" colspan="3"><B>Held Office</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center"><B>Principal Occupation(s)</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center"><B>Held by</B></TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD nowrap align="center" style="border-bottom: 1px solid #000000"><B>Age</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" style="border-bottom: 1px solid #000000"><B>with the Fund</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3" style="border-bottom: 1px solid #000000"><B>Since</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" style="border-bottom: 1px solid #000000"><B>During Past 5 Years</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" style="border-bottom: 1px solid #000000"><B>Officer</B></TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">

<TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Maria Eugenia Pichardo (1950)
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">President
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">2004</TD>
    <TD nowrap valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Portfolio manager of
the Fund since the
Fund&#146;s inception in
1990; President and
General Partner of
Pichardo Asset
Management, S.A. de
C.V., the Fund&#146;s
registered investment
adviser.
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">None</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Francisco Lopez (1971)
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Secretary
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">2005</TD>
    <TD nowrap valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">For the period May
1997 through December
2002, acted as
portfolio manager
assistant to the Fund
at Acciones y Valores
de Mexico, S.A. de
C.V., a wholly owned
subsidiary of
Acciworldwide, S.A. de
C.V., the Fund&#146;s
registered investment
adviser prior to 2002;
Portfolio manager at
Pichardo Asset
Management, S.A. de
C.V., the Fund&#146;s
registered investment
adviser.
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">None</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">Each officer&#146;s term of office is one year and until their respective successors are chosen and
qualified. The officers of the Fund serve without compensation, except that Mr.&nbsp;Hellerman received
an annual fee of $25,000 for the fiscal year ended July&nbsp;31, 2005 for serving as Chief Compliance
Officer.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>Board of Directors</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Under our Certificate of Incorporation, our directors are divided into three classes: Class&nbsp;I,
Class&nbsp;II and Class&nbsp;III, each class having a term of three years. Each year the term of office of
one Class expires. The effect of these staggered terms is to limit the ability of other entities
or persons to acquire control of us by delaying the replacement of a majority of the Board.
Messrs.&nbsp;Goodstein and Goldstein&#146;s term will expire in 2005, the terms of Messrs.&nbsp;Das and Dakos will
expire in 2006, and Mr.&nbsp;Hellerman&#146;s term will expire in 2007. At each annual meeting of our
stockholders, the successors to the class of directors whose terms expire at such meeting will be
elected to hold office for a term expiring at the annual meeting of stockholders held in the third
year following the year of their election.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>Committees of the Board Of Directors</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<I>Audit Committee</I>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The members of the Audit Committee are Messrs.&nbsp;Das, Dakos and Goldstein, each of whom is an
independent director. The Audit Committee is responsible for approving our independent auditors,
reviewing with our independent auditors the plans and results of the audit engagement, approving
professional services provided by our independent auditors, reviewing the independence of our
independent auditors and reviewing the adequacy of our internal accounting controls. In addition,
the Audit Committee members have been designated the Qualified Legal Compliance Committee for
attorney and employee reporting purposes. During the last fiscal year, the Audit Committee
conducted one meeting.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<I>Nominating Committee</I>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Nominating Committee is comprised of all of the directors who are non-interested, namely,
Messrs.&nbsp;Goodstein, Goldstein, Dakos and Das. The Nominating Committee is responsible for seeking
and reviewing
</DIV>

<P align="center" style="font-size: 10pt">26
</DIV>

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<DIV style="font-family: 'Times New Roman',Times,serif">
<DIV align="left" style="font-size: 10pt; margin-top: 6pt">candidates for consideration as nominees for directors as is from time to time considered
necessary or appropriate. During the last fiscal year, the Nominating Committee conducted no
meetings.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;It is the policy of the Nominating Committee to consider nominees recommended by stockholders
of the Fund so long as the stockholders properly submit their recommendations in accordance with
the following: A stockholder wishing to recommend to the Nominating Committee a candidate for
election as director must submit the recommendation in writing, addressed to the Committee care of
our Secretary c/o U.S. Bancorp Fund Services, LLC, 615 Michigan St., 2<SUP style="font-size: 85%; vertical-align: text-top">nd</SUP> Floor,
Milwaukee, Wisconsin 53202. Submissions recommending candidates for election at an annual meeting
of stockholders must be received no later than 120 calendar days prior to the first anniversary of
the date of the proxy statement for the prior annual meeting of stockholders. In the event that the
date of the next annual meeting of stockholders is more than 30&nbsp;days following or preceding the
first anniversary date of the annual meeting of stockholders for the prior year, the submission
must be made a reasonable time in advance of the mailing of our next annual proxy statement. The
written recommendation should include information concerning the stockholder or group of
stockholders making the recommendation, the proposed nominee, relationships between the
recommending stockholder and the proposed nominee and the qualifications of the proposed nominee to
serve as director, describing the contributions that the nominee would be expected to make to the
Board. The recommendation must also be accompanied by the consent of the proposed nominee to serve
if nominated and the agreement of the nominee to be interviewed by the Nominating Committee, if the
Nominating Committee decides in its discretion to do so.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<I>Valuation Committee</I>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The members of the Valuation Committee are all of the directors who are non-interested,
namely, Messrs.&nbsp;Goodstein, Goldstein, Dakos and Das. The Valuation Committee is responsible for
reviewing and approving the fair value determinations provided by the adviser with respect to any
securities for which market quotations are not readily available. During the last fiscal year, the
Valuation Committee conducted no meetings.
</DIV>
<DIV align="left">
<A name="113"></A>
</DIV>

<DIV align="left" style="font-size: 12pt; margin-top: 12pt"><B>Compensation of Directors</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The following table shows information regarding the compensation expected to be received
by the directors for the fiscal year ending July&nbsp;31, 2005.
</DIV>
<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="88%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">Total Compensation</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2">from Fund Paid during the</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD nowrap align="center" style="border-bottom: 1px solid #000000">Name of Director</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="2" style="border-bottom: 1px solid #000000">Period Ended July 31, 2005</TD>
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Glenn Goodstein</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">7,900</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Phillip Goldstein</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">8,600</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Andrew Dakos</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">8,600</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Gerald Hellerman</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">27,500</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Rajeev Das</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">8,600</TD>
    <TD>&nbsp;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>

 <DIV align="left">
<DIV style="font-size: 3pt; margin-top: 12pt; width: 18%; border-top: 1px solid #000000">&nbsp;</DIV>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 0pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The directors will receive an annual fee of $5,000 plus $700 for each Board Meeting attended
in person and $100 for each special telephonic meeting attended. We pay the members of the Audit
Committee $100 per meeting attended. Of the compensation paid to Mr.&nbsp;Hellerman during the fiscal
year ended July&nbsp;31, 2005, $24,000 was in consideration for his services as Chief Compliance
Officer.
</DIV>
<DIV align="left">
<A name="114"></A>
</DIV>

<DIV align="left" style="font-size: 12pt; margin-top: 12pt"><B>Investment Advisory Agreement</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><B>Management Services/Portfolio Manager</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;PAM serves as our investment adviser. PAM is a registered investment adviser under the
Advisers Act. Subject to the overall supervision of our Board of Directors, PAM manages our
day-to-day operations and provides us with investment advisory services. Under the terms of an
Investment Advisory Agreement, PAM will conduct all
</DIV>

<P align="center" style="font-size: 10pt">27
</DIV>

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<DIV style="font-family: 'Times New Roman',Times,serif">
<DIV align="left" style="font-size: 10pt; margin-top: 6pt">investment research and supervision and is responsible for the purchase and sale of our
investment portfolio securities, subject to the supervision and direction of the Board. PAM also
provides us with advice, supervises our management and investment programs and provides investment
advisory facilities and executive and supervisory personnel for managing the investments and
effectuating portfolio transactions. PAM also furnishes, at its own expense, all necessary
administrative services, office space, equipment and clerical personnel for servicing our
investments. In addition, PAM will pay the salaries and fees of all of our officers who are
affiliated with PAM.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;PAM&#146;s services under the Investment Advisory Agreement are not exclusive, and it is free to
furnish similar services to other entities so long as its services to us are not impaired.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>Management Fees</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We pay PAM a monthly fee at an annual rate of 0.80% of the value of our average daily net
assets for the investment management and research services provided. In addition, PAM has
voluntarily agreed to reimburse us for certain fees and expenses on an annual basis. These expense
reimbursements may be terminated at any time.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>Payment of Expenses</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Investment Advisory Agreement provides that we will be responsible for all of our expenses
and liabilities, except that PAM is responsible for the expense in connection with maintaining a
staff within its organization to furnish the above services to us.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>Duration and Termination</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Investment Advisory Agreement was approved by our Board on June&nbsp;18, 2003, and by our
stockholders on November&nbsp;19, 2003. Unless terminated earlier as described below, it will continue
in effect for a period of two years from its effective date. It will remain in effect from year to
year thereafter if approved annually by our Board or by the affirmative vote of the holders of a
majority of our outstanding voting securities, including, in either case, approval by a majority of
our Directors who are not interested persons. The Investment Advisory Agreement will automatically
terminate in the event of its assignment. The Investment Advisory Agreement may be terminated by
either party without penalty upon not more than 60&nbsp;days&#146; written notice to the other.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>Organization of the Investment Adviser</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;PAM is organized as a corporation under the laws of Mexico and is registered as an investment
adviser under the Advisers Act. PAM&#146;s principal office is located at Teopanzolco Avenue #408,
3<SUP style="font-size: 85%; vertical-align: text-top">rd</SUP> Floor, Cuernavaca 62260, Morelos, Mexico. Maria Eugenia Pichardo is the President
and Chief Executive Officer of PAM. Ms.&nbsp;Pichardo owns 99% of the total outstanding shares of
common stock of PAM and has acted as the Fund&#146;s portfolio manager since the Fund&#146;s inception.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>Factors in Approving the Investment Advisory Agreement</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Fund&#146;s Board of Directors, including the directors who are not interested persons of any
party to the Investment Advisory Agreement or its affiliates, approved the Investment Advisory
Agreement at a meeting of the Board of Directors held on June&nbsp;29, 2004, with legal counsel in
attendance. In approving the Investment Advisory Agreement, the Board of Directors considered the
best interests of the stockholders and took into account factors they deemed relevant, as described
below.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;PAM provided the Board with written materials concerning: (a)&nbsp;information on the investment
performance of the investment adviser; (b)&nbsp;the economic outlook and the general investment outlook
in the markets in which the Fund invests; (c)&nbsp;the procedures employed to determine the value of
Fund assets; (d)&nbsp;the investment adviser&#146;s management of the relationships with the Fund&#146;s
administrator and custodian; (e)&nbsp;the resources devoted to compliance with the Fund&#146;s investment
policies and restrictions and with policies on personal securities transactions; and (f)&nbsp;the
nature, cost and character of non-investment management services provided by the investment
adviser.
</DIV>

<P align="center" style="font-size: 10pt">28
</DIV>

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<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The factors considered by the independent directors, who met in executive session, included
the nature, quality and scope of the operations and services to provided by PAM, while focusing on
the prior experience of PAM&#146;s principals with respect to: (i)&nbsp;the structure of closed-end
investment companies in general; (ii)&nbsp;management of portfolios of foreign equity securities; (iii)
the fact that the Fund&#146;s current portfolio manager, Maria Eugenia Pichardo, would continue to act
as the Fund&#146;s portfolio manager at PAM; and (iv)&nbsp;implementing policies to cut costs and expenses of
closed-end investment companies. Furthermore, the Board considered the opportunity to obtain
investment management and research services at costs that it deemed appropriate and reasonable and
at such fees which fall within the range of the standard industry fees for comparable investment
companies.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;During the Board&#146;s deliberations, it was noted that they did not identify any single piece of
information that was all-important or controlling with respect to the Investment Advisory
Agreement. Based on the Board&#146;s deliberations and its evaluation of the information described
above, the Board, including all of the independent directors, unanimously concluded that: (a)&nbsp;the
terms of the Investment Advisory Agreement are fair and reasonable; (b)&nbsp;the investment adviser&#146;s
fees are reasonable in light of the services that it provides to the Fund; (c)&nbsp;the Investment
Advisory Agreement was in the best interests of the Fund and its stockholders; and (d)&nbsp;agreed to
approve the Investment Advisory Agreement for term of one year.
</DIV>
<DIV align="left">
<A name="115"></A>
</DIV>

<DIV align="left" style="font-size: 12pt; margin-top: 12pt"><B>Administration Agreement</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;U.S. Bancorp Fund Services LLC serves as our administrator pursuant to an Administration
Agreement dated July&nbsp;21, 2001. Pursuant to the Administration Agreement, Administrator provides us
with, but is not limited to the following types of services, general fund management, compliance
oversight, financial reporting oversight and tax reporting. For the fiscal year ended July&nbsp;31,
2005, the Fund paid Administrator $50,459. In addition, we reimbursed Administrator for certain
expenses and fees incurred on our behalf.
</DIV>
<DIV align="left">
<A name="116"></A>
</DIV>

<DIV align="left" style="font-size: 12pt; margin-top: 12pt"><B>Control Persons and Principal Stockholders</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The following table sets forth certain ownership information with respect to our common
stock for those persons who directly or indirectly own, control or hold with the power to vote, 5%
or more of our outstanding common stock and all officers and directors, as a group.
</DIV>
<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="45%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="13%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="14%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="7"><B>Immediately</B></TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="7"><B>prior to this</B></TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="7" style="border-bottom: 0px solid #000000"><B>offering</B></TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>Type of</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD nowrap align="left"><B>Name and address</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>ownership</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>Shares owned</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>Percentage</B></TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR style="font-size: 1px">
    <TD colspan="13" align="left" style="border-top: 1px solid #000000">&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Deutsche Bank AG(1)<BR>
Taunusanlage 12, D-60325<BR>
Frankfurt am Main<BR>
Federal Republic of Germany</DIV></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center">Record and beneficial</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">287,154</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">11.61</TD>
    <TD nowrap>%</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Richard J. Shaker, d/b/a<BR>
Shaker Financial Services<BR>
1094 Mogothy Circle<BR>
Annapolis, MD 21401</DIV></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center">Record and beneficial</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">159,200</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">6.40</TD>
    <TD nowrap>%</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD><DIV style="margin-left:15px; text-indent:-15px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">All officers and directors as a<BR>
group (7 persons)(1)(2)</DIV></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center">Record and beneficial</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center">&#091;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;     &#093;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">*</TD>
    <TD>&nbsp;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>



<DIV align="left">
<DIV style="font-size: 3pt; margin-top: 16pt; width: 18%; border-top: 1px solid #000000">&nbsp;</DIV>
</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">
<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96"></TD>
</TR>

<TR valign="top">
    <TD nowrap align="left">*</TD>
    <TD>&nbsp;</TD>
    <TD>All of the officers and directors as a group hold less than 1% of the Fund&#146;s shares of
common stock.</TD>
</TR>

<TR style="font-size: 3pt"><TD>&nbsp;</TD></TR>

<TR valign="top">
    <TD nowrap align="left">(1)</TD>
    <TD>&nbsp;</TD>
    <TD>Based solely upon information presented in a <U>Schedule&nbsp;13G/A</U>, dated February&nbsp;10, 2005
filed by Deutsche Bank AG.</TD>
</TR>

<TR style="font-size: 3pt"><TD>&nbsp;</TD></TR>

<TR valign="top">
    <TD nowrap align="left">(2)</TD>
    <TD>&nbsp;</TD>
    <TD>Based solely upon information presented in a <U>Schedule&nbsp;13G/A</U>, dated June&nbsp;30, 2004
filed by Richard J. Shaker, d/b/a Shaker Financial Services.</TD>
</TR>

<TR style="font-size: 3pt"><TD>&nbsp;</TD></TR>

<TR valign="top">
    <TD nowrap align="left">(3)</TD>
    <TD>&nbsp;</TD>
    <TD>The address for all officers and directors is c/o US Bancorp Fund Services, LLC, 615 East
Michigan Street, 2<SUP style="font-size: 85%; vertical-align: text-top">nd</SUP> Floor, Milwaukee, WI 53202.</TD>
</TR>

</TABLE>


<P align="center" style="font-size: 10pt">29
</DIV>

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<DIV style="font-family: 'Times New Roman',Times,serif">






<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>Outstanding Securities</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The following table sets forth certain information regarding our authorized shares and shares
outstanding as of January&nbsp;31, 2005.
</DIV>
<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="30%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="30%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="30%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center"><B>(3)</B></TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD nowrap align="center"><B>(1)</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center"><B>(2)</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center"><B>Amount Issued and</B></TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD nowrap align="center" style="border-bottom: 1px solid #000000"><B>Title of Class</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" style="border-bottom: 1px solid #000000"><B>Amount Authorized</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" style="border-bottom: 1px solid #000000"><B>Outstanding</B></TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:15px; text-indent:-15px">Common Stock
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">100,000,000
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">2,473,504</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>

<DIV align="left">
<A name="117"></A>
</DIV>

<DIV align="left" style="font-size: 12pt; margin-top: 12pt"><B>Determination of Net Asset Value</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The NAV per share of our outstanding shares of common stock is determined daily, by
dividing the value of total assets minus liabilities by the total number of shares outstanding at
the date as of which such determination is made.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;All securities for which market quotations are readily available are valued at the last sales
price prior to the time of determination of net asset value, or , if no sales price is available at
that time, at the closing price last quoted for the securities (but if bid and asked quotations are
available, at the mean between the current bid and asked prices, rather than the quoted closing
price). Securities that are traded over-the-counter are valued (if bid and asked quotations are
available) at the mean between the current bid and asked prices. Investments in short-term debt
securities having a maturity of 60&nbsp;days or less are valued at amortized cost if their term to
maturity from the date of purchase was less than 60&nbsp;days, or by amortizing their value on the
61<SUP style="font-size: 85%; vertical-align: text-top">st</SUP> day prior to maturity if their term to maturity from the date of purchase when
acquired by us was more than 60&nbsp;days. Securities for which market values are not readily
ascertainable are carried at fair value as determined in good faith by, or under the supervision
of, the Board. It is possible that the estimated value may differ significantly from the amount
that might ultimately be realized in the near term, and the difference could be material.
</DIV>
<DIV align="left">
<A name="118"></A>
</DIV>

<DIV align="left" style="font-size: 12pt; margin-top: 12pt"><B>Description of our Capital Stock</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>Capital Stock</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our authorized capital stock consists of 100,000,000 shares of common stock, par value
$0.001 per share, of which 1,855,128 shares are designated as Preference Common Stock. Our common
stock trades on the NYSE under the symbol &#147;MXE.&#148; No stock has been authorized for issuance under
any equity compensation plans. Under Maryland law, our stockholders generally are not personally
liable for our debts or obligations.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As permitted by the Maryland General Corporation Law, our charter provides that the Board of
Directors, without any action by our stockholders, may amend the charter from time to time to
increase or decrease the aggregate number of shares of stock or the number of shares of stock of
any class or series that the Fund have authority to issue. In addition, our charter provides that
the Board, by majority vote, may reclassify any unissued shares of our capital stock into one or
more additional or other classes or series of stock with such designations, preferences, conversion
or other rights, voting powers, restrictions, limitations as to dividends and qualifications as
determined by the Board. As discussed below, our Board has designated a new class of common stock
created specifically for issuance pursuant to this offering.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>Common Stock</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;All shares of our common stock have equal rights as to earnings, assets, dividends and voting
privileges and, when they are issued, will be duly authorized, validly issued, fully paid and
nonassessable. Distributions may be paid to the holders of our common stock if, as and when
authorized by our Board of Directors and declared by us
</DIV>

<P align="center" style="font-size: 10pt">30
</DIV>

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<DIV style="font-family: 'Times New Roman',Times,serif">
<DIV align="left" style="font-size: 10pt; margin-top: 6pt">out of funds legally available for such distributions. Shares of our common stock have no
preemptive, conversion or redemption rights and are freely transferable, except where their
transfer is restricted by federal and state securities laws or by contract. In the event of our
liquidation, dissolution or winding up, each share would be entitled to share ratably in all of our
assets that are legally available for distribution after we pay all debts and other liabilities.
Each of our shares of common stock is entitled to one vote on all matters submitted to a vote of
stockholders, including the election of directors. Except as provided with respect to any other
class or series of stock, the holders of the Fund&#146;s common stock will possess exclusive voting
power. There is no cumulative voting in the election of directors, which means that holders of a
majority of the outstanding shares of common stock will elect all of our directors, and holders of
less than a majority of such shares will be unable to elect any director.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>Preference Common Stock</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Preference Stock is a new class of our common stock designated by the Board specifically
for issuance pursuant to this offering. See &#147;Description of our Capital Stock.&#148; The Preference
Stock has <U><B>identical</B></U> rights, voting powers and qualifications of our common stock and is
<U><B>indistinguishable</B></U> from our common stock, except as set forth in paragraphs (a)&nbsp;and (b)
below:
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt; margin-left: 3%">(a) <U>Repurchase</U>. On a semi-annual basis, on dates to be determined by the Board of
Directors and beginning within the 6&nbsp;month period between January&nbsp;31, 2006 and July&nbsp;31,
2006, the Fund intends to conduct special Tender Offers for Preference Stock as further
described in &#147;Preference Common Stock Rights Offering &#150; Semi-Annual Tender Offer&#148;.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt; margin-left: 3%">(b) <U>Automatic Conversion</U>. If the Put Warrant Program is approved by the SEC, the
Preference Stock will automatically convert into common stock on a one-to-one basis upon the
anticipated issuance of put warrants by the Fund, and, shortly thereafter, stockholders will
receive put warrants. Holders of the Preference Stock will have no other conversion rights.
See &#147;Preference Common Stock Rights Offering &#150; Put Warrant Program&#148; above.
</DIV>
<DIV align="left">
<A name="119"></A>
</DIV>

<DIV align="left" style="font-size: 12pt; margin-top: 12pt"><B>Limitation on Liability of Directors and Officers; Indemnification and Advancement of
Expenses</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Maryland law permits a Maryland corporation to include in its charter a provision
limiting the liability of its directors and officers to the corporation and its stockholders for
money damages except for liability resulting from (a)&nbsp;actual receipt of an improper benefit or
profit in money, property or services or (b)&nbsp;active and deliberate dishonesty established by a
final judgment and which is material to the cause of action. Our charter contains such a provision
which eliminates directors&#146; and officers&#146; liability to the maximum extent permitted by Maryland
law, subject to the requirements of the 1940 Act.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our bylaws obligate us, to the maximum extent permitted by Maryland law and subject to the
requirements of the 1940 Act, to indemnify any director, officer, employees or agents of the Fund
against any judgments, fines, settlements or expenses.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Maryland law requires a corporation (unless its charter provides otherwise, which our charter
does not) to indemnify a director or officer who has been successful in the defense of any
proceeding to which he or she is made a party by reason of his or her service in that capacity.
Maryland law permits a corporation to indemnify its present and former directors and officers,
among others, against judgments, penalties, fines, settlements and reasonable expenses actually
incurred by them in connection with any proceeding to which they may be made a party by reason of
their service in those or other capacities unless it is established that (a)&nbsp;the act or omission of
the director or officer was material to the matter giving rise to the proceeding and (1)&nbsp;was
committed in bad faith or (2)&nbsp;was the result of active and deliberate dishonesty, (b)&nbsp;the director
or officer actually received an improper personal benefit in money, property or services or (c)&nbsp;in
the case of any criminal proceeding, the director or officer had reasonable cause to believe that
the act or omission was unlawful. However, under Maryland law, a Maryland corporation may not
indemnify for an adverse judgment in a suit by or in the right of the corporation or for a judgment
of liability on the basis that a personal benefit was improperly received, unless in either case a
court orders indemnification, and then only for expenses. In addition, Maryland law permits a
corporation to advance reasonable expenses to a
</DIV>

<P align="center" style="font-size: 10pt">31
</DIV>

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<DIV style="font-family: 'Times New Roman',Times,serif">
<DIV align="left" style="font-size: 10pt; margin-top: 6pt">director or officer upon the corporation&#146;s receipt of (a)&nbsp;a written affirmation by the
director or officer of his or her good faith belief that he or she has met the standard of conduct
necessary for indemnification by the corporation and (b)&nbsp;a written undertaking by him or her or on
his or her behalf to repay the amount paid or reimbursed by the corporation if it is ultimately
determined that the standard of conduct was not met.
</DIV>

<DIV align="left">
<A name="120"></A>
</DIV>

<DIV align="left" style="font-size: 12pt; margin-top: 12pt"><B>Provisions of the Maryland General Corporation Law and our Charter and Bylaws</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Maryland General Corporation Law and our charter and bylaws contain provisions that
could make it more difficult for a potential acquiror to acquire us by means of a tender offer,
proxy contest or otherwise. These provisions are expected to discourage certain coercive takeover
practices and inadequate takeover bids and to encourage persons seeking to acquire control of us to
negotiate first with our Board. We believe that the benefits of these provisions outweigh the
potential disadvantages of discouraging any such acquisition proposals because, among other things,
the negotiation of such proposals may improve their terms.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>Classified Board of Directors</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our Board is divided into three classes of directors serving staggered three-year terms. A
classified board may render a change in control of us or removal of our incumbent management more
difficult. We believe, however, that the longer time required to elect a majority of a classified
board of directors will help to ensure the continuity and stability of our management and policies.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>Action by Stockholders</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Maryland General Corporation Law provides that stockholder action can be taken only at an
annual or special meeting of stockholders or by unanimous written consent in lieu of a meeting.
These provisions, combined with the requirements of our bylaws regarding the calling of a
stockholder-requested special meeting of stockholders discussed below, may have the effect of
delaying consideration of a stockholder proposal until the next annual meeting.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>Ability of Stockholders to call a Special Meeting of Stockholders</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our bylaws only allow our stockholders to call a Special Meeting of Stockholders if such
request is made to the Secretary of the Fund in writing signed by stockholders having at least 50%
of the issued and outstanding shares of common stock.
</DIV>
<DIV align="left">
<A name="121"></A>
</DIV>

<DIV align="left" style="font-size: 12pt; margin-top: 12pt"><B>Regulation</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We intend to continue to be regulated as a registered management investment company under
the 1940 Act and as a registered investment company under Subchapter M of the Internal Revenue
Code. The 1940 Act contains prohibitions and restrictions relating to transactions between
registered investment companies and their affiliates (including any investment advisers or
sub-advisers), principal underwriters and affiliates of those affiliates or underwriters and
requires that a majority of the directors be persons other than &#147;interested persons,&#148; as that term
is defined in the 1940 Act.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>Temporary Investments</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We may take temporary defensive positions in cash or in high quality, short-term debt
securities or other money market instruments in response to adverse market, economic, political or
other conditions.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>Code of Ethics</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Fund and PAM have each adopted a code of ethics pursuant to Rule&nbsp;17j-1 under the 1940 Act
that establishes procedures for personal investments and restricts certain personal securities
transactions. Personnel
</DIV>

<P align="center" style="font-size: 10pt">32
</DIV>

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<DIV style="font-family: 'Times New Roman',Times,serif">
<DIV align="left" style="font-size: 10pt; margin-top: 6pt">subject to each code may invest in securities for their personal investment accounts,
including securities that may be purchased or held by us, so long as such investments are made
pursuant to the code&#146;s requirements. For information on how to obtain a copy of each code of
ethics, see &#147;Available Information.&#148;
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>Proxy Voting Policies and Procedures</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Proxy Voting Policies and Guidelines contained in this document summarize our positions on
various issues of concern to our stockholders. These Guidelines give general indication as to how
our investment adviser will vote our portfolio securities on each issue listed. However, this
listing does not address all potential voting issues or the intricacies that may surround
individual proxy votes. For that reason there may be instances in which votes may vary from the
guidelines presented here. We endeavor to vote our shares in accordance with our investment
objectives and strategies.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Fund will vote NO on any proposals that would limit or restrict a stockholders rights.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>I. CORPORATE GOVERNANCE</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><B>A. Board and Governance Issues</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>1. Board of Director/Trustee Composition</B>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">The Board of Directors is responsible for the overall governance of the corporation.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">The Fund adviser will <U><B>oppose</B></U> slates without at least a majority of independent directors
(1/3 of directors who are outsiders to the corporation).
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">The Fund adviser will vote <U><B>for</B></U> shareholder proposals that request that the board audit,
compensation and/or nominating committees include independent directors exclusively.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>2. Increase Authorized Common Stock</B>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">The Fund adviser will generally <U><B>support</B></U> the authorization of additional common stock
necessary to facilitate a stock split.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">The Fund adviser will generally <U><B>support</B></U> the authorization of additional common stock, if
the company already has a large amount of stock authorized but not issued or reserved for its stock
option plans. In this latter instance, there is a concern that the authorized but unissued shares
will be used as a poison pill or other takeover defense, which will be <U><B>opposed</B></U>. In
addition, the Fund will require the company to provide a specific purpose for any request to
increase shares by more than 100&nbsp;percent of the current authorization.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>3. Blank Check Preferred Stock</B>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">Blank check preferred is stock with a fixed dividend and a preferential claim on company assets
relative to common shares. The terms of the stock (voting dividend and conversion rights) are set
by the Board at a future date without further shareholder action. While such an issue can in
theory have legitimate corporate purposes, most often it has been used as a takeover defense since
the stock has terms that make the entire company less attractive.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">The Fund adviser will generally <U><B>oppose</B></U> the creation of blank check preferred stock.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>4. Classified or &#147;Staggered&#148; Board</B>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">On a classified (or staggered) board, directors are divided into separate classes (usually three)
with directors in each class elected to overlapping three-year terms. Companies argue that such
Boards offer continuity in direction which promotes long-term planning. However, in some instances
they may serve to deter unwanted takeovers since a potential buyer would have to wait at least two
years to gain a majority of Board seats.
</DIV>



<P align="center" style="font-size: 10pt">33
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<DIV style="font-family: 'Times New Roman',Times,serif">


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">The Fund adviser will vote no on proposals involving classified boards.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>5. Supermajority Vote Requirements</B>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">Supermajority vote requirements in a company&#146;s charter or bylaws require a level of voting approval
in excess of a simple majority. Generally, supermajority provisions require at least 2/3
affirmative vote for passage of issues.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">The Fund adviser will vote no on proposals involving supermajority voting.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>6. Restrictions on Stockholders to Act by Written Consent</B>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">Written consent allows stockholders to initiate and carry out a shareholder action without waiting
until the annual meeting or by calling a special meeting. It permits action to be taken by the
written consent of the same percentage of outstanding shares that would be required to effect the
proposed action at a shareholder meeting.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">The Fund adviser will vote no on proposals to limit or eliminate the right of stockholders to act
by written consent.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>7. Restrictions on Stockholders to Call Meetings</B>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">The Fund adviser will generally <U><B>oppose</B></U> such a restriction as it limits the right of the
stockholder.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>8. Limitations, Director Liability and Indemnification</B>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">Because of increased litigation brought against directors of corporations and the increased costs
of director&#146;s liability insurance, many states have passed laws limiting director liability for
those acting in good faith. Stockholders however must opt into such statutes. In addition, many
companies are seeking to add indemnification of directors to corporate bylaws.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">The Fund adviser will generally <U><B>support</B></U> director liability and indemnification resolutions
because it is important for companies to be able to attract the most qualified individuals to their
Boards. Note: Those directors acting fraudulently would remain liable for their actions
irrespective of this resolution.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>9. Reincorporation</B>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">Corporations are in general bound by the laws of the state in which they are incorporated.
Companies reincorporate for a variety of reasons including shifting incorporation to a state where
the company has its most active operations or corporate headquarters, or shifting incorporation to
take advantage of state corporate takeover laws.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">While each reincorporation proposal will be evaluated based on its own merits, the Fund adviser
will generally <U><B>support</B></U> reincorporation resolutions for valid business reasons (such as
reincorporating in the same state as the corporate headquarters).
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>10. Cumulative Voting</B>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">Cumulative voting allows stockholders to &#147;stack&#148; their votes behind one or a few director nominees
running for the Board, thereby helping a minority of stockholders to win board representation.
Cumulative voting gives minority stockholders a voice in corporate affairs proportionate to their
actual strength in voting shares.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">The Fund adviser will generally <U><B>support</B></U> proposals calling for cumulative voting in the
election of directors.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>11. Dual Classes of Stock</B>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">In order to maintain corporate control in the hands of a certain group of stockholders, companies
may seek to create multiple classes of stock with differing rights pertaining to voting and
dividends.
</DIV>


<P align="center" style="font-size: 10pt">34
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<DIV style="font-family: 'Times New Roman',Times,serif">



<DIV align="left" style="font-size: 10pt; margin-top: 6pt">The Fund adviser will generally <U><B>oppose</B></U> dual classes of stock. However, the advisor will
<U><B>support</B></U> classes of stock offering different dividend rights (such as one class which pays
cash dividends and a second which pays stock dividends) depending on the circumstances.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>12. Limit Directors&#146; Tenure</B>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">In general corporate directors may stand for re-election indefinitely. Opponents of this practice
suggest that limited tenure would inject new perspectives into the boardroom as well as possibly
creating room for directors from diverse backgrounds; however, continuity is important to corporate
leadership and in some instances alternative means may be explored for injecting new ideas or
members from diverse backgrounds into corporate boardrooms.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">Accordingly, the Fund adviser will vote on a case-by-case basis attempts to limit director tenure.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>13. Minimum Director Stock Ownership</B>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">The director share ownership proposal requires that all corporate directors own a minimum number of
shares in the corporation. The purpose of this resolution is to encourage directors to have the
same interest as other stockholders.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">The Fund adviser will <U><B>support</B></U> resolutions that require corporate directors to own shares in
the company.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>14. Selection of Auditor</B>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">Annual election of the outside accountants is standard practice. While it is recognized that the
company is in the best position to evaluate the competence of the outside accountants, we believe
that outside accountants must ultimately be accountable to stockholders. Furthermore, audit
committees have been the subject of a report released by the Blue Ribbon Commission on Improving
the Effectiveness of Corporate Audit Committees in conjunction with the NYSE and the National
Association of Securities Dealers. The Blue Ribbon Commission concluded that audit committees must
improve their current level of oversight of independent accountants. Given the rash of accounting
irregularities that were not detected by audit panels or auditors, shareholder ratification is an
essential step in restoring investor confidence.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">The Fund adviser will <U><B>oppose</B></U> the resolutions seeking ratification of the auditor when fees
for financial systems design and implementation exceed audit and all other fees, as this can
compromise the independence of the auditor.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">The Fund adviser will <U><B>oppose</B></U> the election of the audit committee chair if the audit
committee recommends an auditors whose fees for financial systems design and implementation exceed
audit and all other fees, as this can compromise the independence of the auditor.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>B. Executive Compensation</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><B>1. Disclosure of President, Executive Officers, Board and Management Compensation</B>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">On a case-by-case basis, the Fund adviser will <U><B>support</B></U> shareholder resolutions requesting
companies to disclose the salaries of top management and the Board of Directors.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>2. Compensation for President, Executive Officers, Board and Management</B>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">The Fund adviser will <U><B>oppose</B></U> an executive compensation proposal if we believe the
compensation does not reflect the economic and social circumstances of the company (i.e. at times
of layoffs, downsizing, employee wage freezes, etc.).
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>3. Formation and Independence of Compensation Review Committee</B>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">The Fund adviser will <U><B>support</B></U> stockholder resolutions requesting the formation of a
committee of independent directors to review and examine executive compensation.
</DIV>


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</DIV>

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<DIV style="font-family: 'Times New Roman',Times,serif">




<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>4. Stock Options for Board and Executives</B>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">The Fund adviser will generally <U><B>oppose</B></U> stock option plans that in total offer greater than
15% of shares outstanding because of voting and earnings dilution.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">The Fund adviser will generally <U><B>oppose</B></U> option programs that allow the repricing of
underwater options. (Repricing divides stockholder and employee interests. Stockholders cannot
&#147;reprice&#148; their stock and, therefore, optionees should not be treated differently).</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">The Fund adviser will generally <U><B>oppose</B></U> stock option plans that have option exercise prices
below the marketplace on the day of the grant.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">The Fund adviser will generally <U><B>support</B></U> options programs for outside directors subject to
the same constraints previously described.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>5. Employee Stock Ownership Plan (ESOPs)</B>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">The Fund adviser will <U><B>support</B></U> ESOPs created to promote active employee ownership. However,
they will <U><B>oppose</B></U> any ESOP whose purpose is to prevent a corporate takeover.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>6. Pay Equity</B>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">The Fund adviser will <U><B>support</B></U> stockholder resolutions that request that management provide
a race and/or gender pay equity report.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>7. Changes to Charter or ByLaws</B>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">The Fund adviser will conduct a case-by-case review of the proposed changes with the voting
decision resting on whether the proposed changes are in stockholder&#146;s best interests.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>8. Confidential Voting</B>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">Typically, proxy voting differs from voting in political elections in that the company is made
aware of shareholder votes as they are cast. This enables management to contact dissenting
stockholders in an attempt to get them to change their votes.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">The Fund adviser will <U><B>support</B></U> confidential voting because the voting process should be free
of coercion.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>9. Equal Access to Proxy</B>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">Equal access proposals ask companies to give stockholders access to proxy materials to state their
views on contested issues, including director nominations. In some cases, they would actually
allow stockholders to nominate directors. Companies suggest that such proposals would make an
increasingly complex process even more burdensome.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">In general, the Fund adviser will <U><B>oppose</B></U> resolutions for equal access proposals.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>10. Golden Parachutes</B>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">Golden parachutes are severance payments to top executives who are terminated or demoted pursuant
to a takeover. Companies argue that such provisions are necessary to keep executives from &#147;jumping
ship&#148; during potential takeover attempts.
</DIV>


<P align="center" style="font-size: 10pt">36
</DIV>

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<DIV style="font-family: 'Times New Roman',Times,serif">



<DIV align="left" style="font-size: 10pt; margin-top: 6pt">The Fund adviser will <U><B>support</B></U> the right of stockholders to vote on golden parachutes
because they go above and beyond ordinary compensation practices. In evaluating a particular
golden parachute, we will examine total management compensation, the employees covered by the plan,
and the quality of management.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><B>C. Mergers and Acquisitions</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>1. Considering the Non-Financial Effects of a Merger Proposal</B>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">Such a proposal allows or requires the Board to consider the impact of merger decisions on various
&#147;stakeholders,&#148; such as employees, communities, customers and business partners. This proposal
gives the Board the right to reject a tender offer on the grounds that it would adversely affect
the Fund&#146;s stakeholders.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">The Fund adviser will <U><B>support</B></U> stockholder resolutions that consider non-financial impacts
of mergers.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>2. Mergers, Restructuring and Spin-offs</B>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">A merger, restructuring, or spin-off in some way affects a change in control of the Fund&#146;s assets.
In evaluating the merit of each issue, we will consider the terms of each proposal. This will
include an analysis of the potential long-term value of the investment.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">The Fund adviser will <U><B>support</B></U> management proposals for merger or restructuring if the
transaction appears to offer fair value and other proxy voting policies stated are not violated.
For example, the adviser may oppose restructuring resolution which include in it significant
takeover defenses and may again oppose the merger of a non-nuclear and a nuclear utility if it
poses potential liabilities.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>3. Poison Pills</B>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">Poison pills (or stockholder rights plans) are triggered by an unwanted takeover attempt and cause
a variety of events to occur which may make the company financially less attractive to the suitor.
Typically, directors have enacted these plans without stockholder approval. Most poison pill
resolutions deal with putting poison pills up for a vote or repealing them altogether.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">The Fund adviser will <U><B>support</B></U> proposals to put rights plans up for a stockholder vote. In
general, poison pills will be <U><B>opposed</B></U> unless management is able to present a convincing
case fur such a plan.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>4. Opt-Out of State Anti-Takeover Law</B>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">A strategy for dealing with anti-takeover issues has been a stockholder resolution asking for a
company to opt-out of a particular state&#146;s anti-takeover laws.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">The Fund adviser will generally <U><B>support</B></U> bylaws changes requiring a company to opt-out of
state anti-takeover laws. However, resolutions requiring companies to opt-into state anti-takeover
statutes will be <U><B>opposed</B></U>.
</DIV>

<DIV align="left">
<A name="122"></A>
</DIV>

<DIV align="left" style="font-size: 12pt; margin-top: 12pt"><B>Share Repurchases</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Stockholders of a closed-end management investment company generally do not have the
right to cause it to repurchase its shares. Generally, a closed-end management company may
repurchase its shares under the 1940 Act: (1)&nbsp;on a securities exchange or such other open market
as may be designated by the SEC (provided that it has, in any such case, informed holders of the
class of stock involved within the preceding six months of its intention to repurchase such stock),
(2)&nbsp;by a tender offer open to all holders of the class of shares involved or (3)&nbsp;as otherwise
permitted by the SEC. If the Fund intends to repurchase its shares other than on a securities
exchange, in the open market or by making a tender offer, a rule adopted by the SEC under the 1940
Act provides that the closed-end fund must meet certain conditions regarding the distribution of
our net income, the identity of the seller, the price paid, any brokerage commissions, prior notice
to holders of the class of shares involved of an intention to purchase such
</DIV>

<P align="center" style="font-size: 10pt">37
</DIV>

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<DIV style="font-family: 'Times New Roman',Times,serif">
<DIV align="left" style="font-size: 10pt; margin-top: 6pt">shares and that the purchase is not being made in a manner or on a basis which discriminates
unfairly against the other holders of such class.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;While we are not required to repurchase our shares, we have done so in the past and may
continue to do so if the Board believes that such repurchase is in our best interests and of our
stockholders.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;At a Meeting of the Board held on December&nbsp;13, 2001, the Board approved a tender offer (the
&#147;Tender&#148;). The Tender allowed us to purchase up to 100% of each stockholder&#146;s shares of common
stock, not to exceed 80% of the total outstanding shares of our common stock, for cash at a price
equal to 100% of our net asset value per share as of the closing date. The Tender commenced on
February&nbsp;19, 2002 and expired on March&nbsp;20, 2002. In connection with the Tender, the Fund purchased
6,122,069 shares of capital stock at a total cost of $68,444,728. There were no gains or losses to
the Fund because the repurchase of tendered shares was executed at 100% of the Fund&#146;s NAV as
calculated on the Expiration Date.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;At a Special Meeting of the Board of Directors held on October&nbsp;11, 1999, the Board approved a
share repurchase program. Pursuant to the share repurchase program, we were authorized to commence
a two phase share repurchase program for up to 2,800,000 shares, or approximately 25% of our then
outstanding shares of common stock, through a combination of share purchases and tender offers.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;During the years ended July&nbsp;31, 2002, 2003, 2004 and 2005, we made no repurchases pursuant to
the program. Pursuant to the share repurchase program, during the year ended July&nbsp;31, 2001, we
purchased 174,000 share of capital stock in the open market at a total cost of $1,703,552. The
weighted average discount of these purchases comparing the purchase price to the net asset value at
the time of purchase was 9.01%. During the fiscal year ended July&nbsp;31, 2000, we purchased 1,199,700
shares of capital stock in the open market at a total cost of $10,573,159. The weighted average
discount of these purchases comparing the purchase prices to the net asset value at the time of
purchase was 16.40%.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As discussed under &#147;Preference Common Stock Rights Offering &#150; Semi-Annual Tender Offer&#148;
herein, the Fund will conduct a series of tender offers for Preference Stock only (a &#147;Tender
Offer&#148;) on a semi-annual basis (each semi-annual period, a &#147;Tender Period&#148;), on dates to be
determined by the Board of Directors and beginning within the 6&nbsp;month period between January&nbsp;31,
2006 and July&nbsp;31, 2006, in which 25% of the issued and outstanding Preference Stock on the date the
Preference Stock is issued may be tendered to the Fund and repurchased for the Fund&#146;s portfolio
securities. Each stockholder participating in a Tender Offer may have his or her tendered shares of
Preference Stock repurchased by the Fund in kind for portfolio securities having a value equal to
99% of NAV as determined, with respect to each Tender Offer, on a date designated by the Board. In
the event that the average trade weighted discount to the last published NAV for the Fund is less
than 5% for any five consecutive trading days during any Tender Period (a &#147;Tender Termination
Event&#148;), the Fund will not conduct a Tender Offer during that Tender Period. In the event of a
Tender Termination Event, a Tender Offer will be conducted during the next Tender Period (unless a
Tender Termination Event exists during such next Tender Period).
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In order to ensure that the Fund conducts such a Tender Offer, the Fund has adopted, at a
Special Meeting of the Board of Directors held on
&#091;&nbsp;&nbsp;&nbsp; &#093;, 2005, the following Fundamental
Periodic Repurchase Offer Policy:
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>Fundamental Preference Common Stock Periodic Repurchase Offer Policy</B>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">(a)&nbsp;The Fund will make offers to repurchase its Preference Stock semi-annually;
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">(b)&nbsp;Repurchase request deadlines shall be disclosed in the notification provided to stockholders of
a repurchase offer and repurchase request deadlines shall be determined by the Board consistent
with the 1940 Act, applicable SEC regulations and the terms of any exemptive order issued to the
Fund by the SEC; and
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">(c)&nbsp;The date on which the repurchase price for shares of Preference Stock is to be determined shall
occur no later than the fourteenth day after a repurchase request deadline, or the next business
day if such day is not a business day.
</DIV>


<P align="center" style="font-size: 10pt">38
</DIV>

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<DIV style="font-family: 'Times New Roman',Times,serif">



<DIV align="left" style="font-size: 10pt; margin-top: 6pt">For each repurchase offer, the Fund will offer to repurchase 25% of the Fund&#146;s outstanding
shares of Preference Stock. Participating stockholders generally will receive a pro-rata
distribution or &#147;slice&#148; of the Fund&#146;s portfolio securities in return for their repurchase shares of
Preference Stock except for (a)&nbsp;securities which, if distributed, would be required to register
under the Securities Act of 1933; (b)&nbsp;securities issued by entities in countries which restrict or
prohibit the holding of securities by non-nationals other than through qualified investment
vehicles; and (c)&nbsp;certain portfolio assets (such as forward currency exchange contracts, futures
and options contracts, and repurchase agreements) that, although they may be liquid and marketable,
include the assumption of contractual obligations, require special trading facilities or can only
be traded with the counterparty to the transaction in order to effect a change in beneficial
ownership. Additionally, the Fund may pay cash for fractional shares and/or odd lots of securities
and/or amounts attributable to any cash positions (including short-term non-equity securities);
distribute odd lots, fractional shares and any cash position to stockholders; round down fractional
shares so as to eliminate them prior to distribution; or pay a higher pro-rata percentage of equity
securities to represent those items.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">The Fund anticipates that it will conduct its Tender Offers semi-annually, beginning within the 6
month period between January&nbsp;31, 2006 and July&nbsp;31, 2006, for 25% of the issued and outstanding
shares of Preference Stock. See &#147;Preference Common Stock Rights Offering &#150; Semi-Annual Tender
Offer.&#148;
</DIV>

<DIV align="left">
<A name="123"></A>
</DIV>

<DIV align="left" style="font-size: 12pt; margin-top: 12pt"><B>Custodian, Transfer and Dividend Paying Agent and Registrar</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our portfolio securities are held under a custody agreement by U.S. Bank, N.A. The
address of the custodian is: 425 Walnut Street, Cincinnati, OH 45202. Our assets are held under
bank custodianship in compliance with the 1940 Act. Computershare Trust Company of New York acts
as our transfer agent, dividend paying agent and registrar. The principal business address of the
transfer agent is 2 North La Salle Street, Chicago, IL 60602.
</DIV>
<DIV align="left">
<A name="124"></A>
</DIV>

<DIV align="left" style="font-size: 12pt; margin-top: 12pt"><B>Brokerage Allocation and Other Practices</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Subject to the supervision of the directors, decisions to buy and sell securities for the
Fund are made by the adviser. The adviser is authorized by the directors to allocate the orders
placed by them on behalf of the Fund to brokers and dealers who may, but need not, provide research
or statistical material or other services to the Fund or the adviser for the Fund&#146;s use. Such
allocation is to be in such amounts and proportions as the adviser may determine.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In selecting a broker or dealer to execute each particular transaction, the adviser will take
the following into consideration: (i)&nbsp;best net price available; (ii)&nbsp;the reliability, integrity and
financial condition of the broker or dealer; (iii)&nbsp;the size of and difficulty in executing the
order; and (iv)&nbsp;the value of the expected contribution of the broker or dealer to the investment
performance of the Fund on a continuing basis.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Brokers or dealers executing a portfolio transaction on behalf of the Fund may receive a
commission in excess of the amount of commission another broker or dealer would have charged for
executing the transaction if the adviser determines in good faith that such commission is
reasonable in relation to the value of brokerage, research and other services provided to the Fund.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In allocating portfolio brokerage, the adviser may select brokers or dealers who also provide
brokerage, research and other services to other accounts over which the adviser exercise investment
discretion. Some of the services received as the result of the Fund&#146;s transactions may primarily
benefit accounts other than the Fund&#146;s, while services received as the result of portfolio
transactions effected on behalf of those other accounts may primarily benefit the Fund.
</DIV>
<DIV align="left">
<A name="125"></A>
</DIV>

<DIV align="left" style="font-size: 12pt; margin-top: 12pt"><B>Privacy Policy</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We have adopted the following privacy policy in order to safeguard the personal
information of its consumers and customers in accordance with SEC Regulation&nbsp;S-P, 17 CFR 284.30:
</DIV>

<P align="center" style="font-size: 10pt">39
</DIV>

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<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Commitment to Consumer Privacy. </B>The Fund recognizes and respects the privacy expectations of
each of our customers and believes that the confidentiality and protection of consumer information
is one of our fundamental responsibilities. The Fund is committed to maintaining the
confidentiality, integrity and security of the customers&#146; personal information and will handle
personal consumer and customer information only in accordance with Regulation&nbsp;S-P and any other
applicable laws, rules and regulations. The Fund will ensure: (a)&nbsp;the security and confidentiality
of customer records and information; (b)&nbsp;that customer records and information are protected from
any anticipated threats and hazards; and (c)&nbsp;that unauthorized access to, or use of, customer
records or information is protected against.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Collection and Disclosure of Shareholder Information. </B>Consumer information collected by, or
on behalf of, the Fund, generally consists of the following:
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Information received from consumers or customers on or in
applications or other forms, correspondence, or conversations,
including, but not limited to, their name, address, phone number,
social security number, assets, income and date of birth; and</TD>
</TR>

</TABLE>
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Information about transactions with us, our affiliates, or others,
including, but not limited to, shareholder account numbers and
balance, payments history, parties to transactions, cost basis
information, and other financial information.</TD>
</TR>

</TABLE>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Fund does not disclose any nonpublic personal information about our current or former
consumers or customers to nonaffiliated third parties, except as permitted by law. For example, as
the Fund has no employees, it conducts its business affairs through third parties that provide
services pursuant to agreements with the Fund (as well as through its officers and directors).
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Security of Consumer and Customer Information. </B>The Fund will determine whether the policies
and procedures of its affiliates and service providers and reasonably designed to safeguard
customer information and require only appropriate and authorized access to, and use of, customer
information through the application of appropriate administrative, technical, physical, and
procedural safeguards that comply with applicable federal standards and regulations. The Fund
directs each of its service providers to adhere to the Fund&#146;s privacy policy and to their
respective privacy policies with respect to all customer information of the Fund and to take all
actions reasonably necessary so that the Fund is in compliance with the provisions of 17 CFR
248.30, including, as applicable, the&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;development and delivery of initial and annual
privacy notices and maintenance of appropriate and adequate records. The Fund will require its
service providers to confirm to the Fund, in writing, that they are restricting access to nonpublic
personal information about customers to those employees who need to know that information to
provide products or services to customers.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Fund requires its service providers to provide periodic reports, no less frequently than
annually, to the Board of Directors outlining their privacy policies and implementation and
promptly report to the Fund any material changes to their privacy policy before, or promptly after,
their adoption.
</DIV>
<DIV align="left">
<A name="126"></A>
</DIV>

<DIV align="left" style="font-size: 12pt; margin-top: 12pt"><B>Legal Matters</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Legal matters regarding the securities offered by this Prospectus and of the Fund in
general will be passed upon for the Fund by Blank Rome LLP, New York, New York.
</DIV>
<DIV align="left">
<A name="127"></A>
</DIV>

<DIV align="left" style="font-size: 12pt; margin-top: 12pt"><B>Experts</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The financial statements included in this Prospectus and in the Registration Statement
have been audited by Tait, Weller &#038; Baker LLP, an independent registered public accounting firm, to
the extent and for the periods set forth in their report appearing elsewhere herein and in the
Registration Statement, and are included in reliance upon such report given upon the authority of
said firm as experts in auditing and accounting.
</DIV>

<P align="center" style="font-size: 10pt">40
</DIV>

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<DIV style="font-family: 'Times New Roman',Times,serif">
<DIV align="left">
<A name="128"></A>
</DIV>

<DIV align="left" style="font-size: 12pt; margin-top: 12pt"><B>Available Information</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We will file with or submit to the SEC reports, proxy statements and other information
meeting the informational requirements of the 1940 Act and the Exchange Act. You may inspect and
copy these reports, proxy statements and other information at the Public Reference Room of the SEC
at 100 F St. NE, Washington, D.C. 20549. You may call the SEC at 1-800-SEC-0330 for information on
the operation of the Public Reference Room. Our SEC filings are also available to the public on the
SEC&#146;s Internet website at <U>http://www.sec.gov</U> and can be inspected at the offices of the NYSE, 20
Broad Street, New York, NY 10005. Copies of these reports, proxy and information statements and
other information may be obtained, after paying a duplicating fee, by electronic request at the
following E-mail address: publicinfo@sec.gov, or by writing the SEC&#146;s Public Reference Section,
100 F St. NE, Washington, D.C. 20549-0102.
</DIV>
<DIV align="left">
<A name="129"></A>
</DIV>

<DIV align="left" style="font-size: 12pt; margin-top: 12pt"><B>Forward-Looking Statements</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;This Prospectus contains forward-looking statements, within the meaning of the Securities
Act, that involve risks and uncertainties. We use words such as &#147;anticipates,&#148; &#147;believes,&#148;
&#147;expects,&#148; &#147;objectives,&#148; &#147;future,&#148; &#147;intends,&#148; &#147;will,&#148; &#147;may,&#148; &#147;should,&#148; and similar expressions to
identify forward-looking statements. Our actual results could differ materially from those
projected in the forward-looking statements because of various risks and uncertainties, including
the factors set forth in &#147;Risk Factors&#148; and elsewhere in this Prospectus.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We have based the forward-looking statements included in this Prospectus on information
available to us on the date of this Prospectus, and we assume no obligation to update any such
forward-looking statements. Although we undertake no obligation to revise or update any
forward-looking statements, whether as a result of new information, future events or otherwise, you
are advised to consult any additional disclosures that we may make directly to you or through
reports, if any, that we in the future may file with the SEC, including an annual or semi-annual
report on Form N-CSR.
</DIV>
<DIV align="left">
<A name="130"></A>
</DIV>

<DIV align="left" style="font-size: 12pt; margin-top: 12pt"><B>Financial Statements</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Fund hereby incorporates its Annual Report to Stockholders dated July&nbsp;31, 2005 which
will be filed with the Securities and Exchange Commission no later than September&nbsp;29, 2005, and the
Semi-Annual Report to Stockholders dated January&nbsp;31, 2005 which was filed with the Securities and
Exchange Commission.
</DIV>

<P align="center" style="font-size: 10pt">41
</DIV>

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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV align="center" style="font-size: 14pt; margin-top: 18pt"><B>The Mexico Equity &#038; Income Fund, Inc.</B>
</DIV>


<DIV align="center" style="font-size: 10pt; margin-top: 6pt"><B>1,855,128 Shares Issuable Upon Exercise of Rights to Purchase Preference Common<BR>
Stock, $.001 par Value</B>
</DIV>


<P align="center" style="font-size: 10pt">&nbsp;
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">




<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>PART C<BR>
OTHER INFORMATION</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>ITEM 25. FINANCIAL STATEMENTS AND EXHIBITS</B>
</DIV>


<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" nowrap align="left">1.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Financial Statements.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="1%" nowrap align="left">2.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Exhibits</TD>
</TR>

</TABLE>
</DIV>
<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="4%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="94%">&nbsp;</TD>
</TR>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD align="right" valign="top"><DIV style="margin-left:0px; text-indent:-0px">a.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">1) Articles of Incorporation (Incorporated by reference to the Registrant&#146;s
Registration Statement on Form&nbsp;N-2 (File No.&nbsp;33-35089)</TD>
</TR>
<TR valign="bottom">
    <TD align="right" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="right" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">2) Articles of Amendment to the Articles of Incorporation (Incorporated by reference to
Exhibit&nbsp;1(b) to Pre-Effective Amendment Nos. 2 and 3 to the Registrant&#146;s Registration
Statement on Form&nbsp;N-2 (File No.&nbsp;33-35089)</TD>
</TR>
<TR valign="bottom">
    <TD align="right" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="right" valign="top"><DIV style="margin-left:0px; text-indent:-0px">b.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Amended and Restated Bylaws (Incorporated by reference to Exhibit&nbsp;2(b) to Pre-Effective
Amendment No.&nbsp;2 to the Registrant&#146;s Registration Statement on Form&nbsp;N-2 (File No.&nbsp;33-35089)</TD>
</TR>
<TR valign="bottom">
    <TD align="right" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="right" valign="top"><DIV style="margin-left:0px; text-indent:-0px">c.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Not Applicable</TD>
</TR>
<TR valign="bottom">
    <TD align="right" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="right" valign="top"><DIV style="margin-left:0px; text-indent:-0px">d.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">1) Form of Preference Common Stock Certificate**</TD>
</TR>
<TR valign="bottom">
    <TD align="right" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="right" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">2) Form of Preference Common Stock Purchase Form**</TD>
</TR>
<TR valign="bottom">
    <TD align="right" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="right" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">3) Form of Beneficial Owner Election Form**</TD>
</TR>
<TR valign="bottom">
    <TD align="right" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="right" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">4) Form of Nominee Holder Over-Subscription Form**</TD>
</TR>
<TR valign="bottom">
    <TD align="right" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="right" valign="top"><DIV style="margin-left:0px; text-indent:-0px">e.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Not Applicable</TD>
</TR>
<TR valign="bottom">
    <TD align="right" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="right" valign="top"><DIV style="margin-left:0px; text-indent:-0px">f.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Not Applicable</TD>
</TR>
<TR valign="bottom">
    <TD align="right" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="right" valign="top"><DIV style="margin-left:0px; text-indent:-0px">g.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Investment Advisory Agreement between Registrant and Pichardo Asset Management, S.A. de
C.V.**</TD>
</TR>
<TR valign="bottom">
    <TD align="right" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="right" valign="top"><DIV style="margin-left:0px; text-indent:-0px">h.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Not Applicable</TD>
</TR>
<TR valign="bottom">
    <TD align="right" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="right" valign="top"><DIV style="margin-left:0px; text-indent:-0px">i.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Not Applicable</TD>
</TR>
<TR valign="bottom">
    <TD align="right" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="right" valign="top"><DIV style="margin-left:0px; text-indent:-0px">j.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Custodian Agreement between Registrant and U.S. Bank, N.A.**</TD>
</TR>
<TR valign="bottom">
    <TD align="right" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="right" valign="top"><DIV style="margin-left:0px; text-indent:-0px">k.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">1) Administration Agreement between Registrant and U.S. Bancorp Fund Services, LLC**</TD>
</TR>
<TR valign="bottom">
    <TD align="right" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="right" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">2) Transfer Agency and Service Agreement between Registrant and Computershare Investors
Services, LLC**</TD>
</TR>
<TR valign="bottom">
    <TD align="right" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">

<TD align="right" valign="top"><DIV style="margin-left:0px; text-indent:-0px">l.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Opinion and Consent of Blank Rome LLP, counsel for Registrant**<BR></TD>
</TR>
<TR valign="bottom">
    <TD align="right" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="right" valign="top"><DIV style="margin-left:0px; text-indent:-0px">m.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Not Applicable</TD>
</TR>
<TR valign="bottom">
    <TD align="right" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="right" valign="top"><DIV style="margin-left:0px; text-indent:-0px">n.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Consent of Tait, Weller &#038; Baker LLP, the independent registered public accounting firm
for Registrant</TD>
</TR>
<TR valign="bottom">
    <TD align="right" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="right" valign="top"><DIV style="margin-left:0px; text-indent:-0px">o.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Not Applicable</TD>
</TR>
<TR valign="bottom">
    <TD align="right" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="right" valign="top"><DIV style="margin-left:0px; text-indent:-0px">p.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Not Applicable</TD>
</TR>
<TR valign="bottom">
    <TD align="right" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="right" valign="top"><DIV style="margin-left:0px; text-indent:-0px">q.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Not Applicable</TD>
</TR>
<TR valign="bottom">
    <TD align="right" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="right" valign="top"><DIV style="margin-left:0px; text-indent:-0px">r.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Codes of Ethics of Registrant**</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>



<DIV align="left">
<DIV style="font-size: 3pt; margin-top: 16pt; width: 18%; border-top: 1px solid #000000">&nbsp;</DIV>
</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">
<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96"></TD>
</TR>

<TR valign="top">
    <TD nowrap align="left">*</TD>
    <TD>&nbsp;</TD>
    <TD>Previously filed.</TD>
</TR>

<TR style="font-size: 3pt"><TD>&nbsp;</TD></TR>

<TR valign="top">
    <TD nowrap align="left">**</TD>
    <TD>&nbsp;</TD>
    <TD>To be filed by amendment.</TD>
</TR>

</TABLE>



<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>ITEM 26. MARKETING ARRANGEMENTS</B>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">Not Applicable
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>ITEM 27. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION</B>
</DIV>

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="88%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Commission registration fee</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">______</TD>
    <TD nowrap>*</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Accounting fees and expenses</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">______</TD>
    <TD nowrap>*</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Legal fees and expenses</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">______</TD>
    <TD nowrap>*</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">NYSE Listing fee</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left">$</TD>
    <TD align="right">&#091;27,363&#093;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Subscribing Agent fees and expenses</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">______</TD>
    <TD nowrap>*</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Printing and engraving</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">______</TD>
    <TD nowrap>*</TD>
</TR>
<TR valign="bottom" style="background: #cceeff">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Miscellaneous fees and expenses</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">______</TD>
    <TD nowrap>*</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Total</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left">$</TD>
    <TD align="right">______</TD>
    <TD nowrap>*</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>



<DIV align="left">
<DIV style="font-size: 3pt; margin-top: 16pt; width: 18%; border-top: 1px solid #000000">&nbsp;</DIV>
</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">
<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96"></TD>
</TR>

<TR valign="top">
    <TD nowrap align="left">*</TD>
    <TD>&nbsp;</TD>
    <TD>To be provided by amendment.</TD>
</TR>

<TR style="font-size: 6pt"><TD>&nbsp;</TD></TR>

<TR valign="top">
    <TD nowrap align="left">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>All of the expenses set forth above shall be borne by the Fund.</TD>
</TR>

</TABLE>


<P align="center" style="font-size: 10pt">&nbsp;
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">






<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>ITEM 28. PERSONS CONTROLLED BY OR UNDER COMMON CONTROL</B>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">Not Applicable
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>ITEM 29. NUMBER OF HOLDERS OF SECURITIES</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The following table sets forth the approximate number of record holders of the Fund&#146;s common
stock, $0.001 par value per share, at July&nbsp;31, 2005.
</DIV>
<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="67%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="13%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="14%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD nowrap align="left" style="border-bottom: 1px solid #000000">Title of Class</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left" colspan="3" style="border-bottom: 1px solid #000000">Number of Record Holders</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD><DIV style="margin-left:15px; text-indent:-15px">Common</DIV></TD>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left">572</TD>
    <TD>&nbsp;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>ITEM 30. INDEMNIFICATION</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Reference is made to Section&nbsp;2-418 of the Maryland General Corporation Law, Article&nbsp;XI of the
Company&#146;s Articles of Incorporation, Article&nbsp;VII of the Company&#146;s bylaws, the Investment Advisory
Agreement and Administration Agreement.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Maryland law permits a Maryland corporation to include in its charter a provision limiting the
liability of its directors and officers to the corporation and its stockholders for money damages
except for liability resulting from (a)&nbsp;actual receipt of an improper benefit or profit in money,
property or services or (b)&nbsp;active and deliberate dishonesty established by a final judgment and
which is material to the cause of action. The Registrant&#146;s charter contains such a provision which
eliminates directors&#146; and officers&#146; liability to the maximum extent permitted by Maryland law,
subject to the requirements of the 1940 Act.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our charter authorizes us, to the fullest extent permitted by Maryland law and subject to the
requirements of the 1940 Act, to indemnify any present or former director or officer or any
individual from and against any claim or liability to which that person may become subject or which
that person may incur by reason of his or her status as a present or former director or officer and
to pay or reimburse their reasonable expenses in advance of final disposition of a proceeding. Our
bylaws obligate us, to the maximum extent permitted by Maryland law and subject to the requirements
of the 1940 Act, to indemnify any present or former director or officer or any individual who is
made a party to the proceeding by reason of his service in that capacity from and against any claim
or liability to which that person may become subject or which that person may incur by reason of
his or her status as a present or former director or officer and to pay or reimburse their
reasonable expenses in advance of final disposition of a proceeding. The charter and bylaws also
permit us to indemnify and advance expenses to any person who served a predecessor of us in any of
the capacities described above and any of our employees or agents or any employees or agents of our
predecessor.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Maryland law requires a corporation (unless its charter provides otherwise, which our charter
does not) to indemnify a director or officer who has been successful in the defense of any
proceeding to which he or she is made a party by reason of his or her service in that capacity.
Maryland law permits a corporation to indemnify its present and former directors and officers,
among others, against judgments, penalties, fines, settlements and reasonable expenses actually
incurred by them in connection with any proceeding to which they may be made a party by reason of
their service in those or other capacities unless it is established that (a)&nbsp;the act or omission of
the director or officer was material to the matter giving rise to the proceeding and (1)&nbsp;was
committed in bad faith or (2)&nbsp;was the result of active and deliberate dishonesty, (b)&nbsp;the director
or officer actually received an improper personal benefit in money, property or services or (c)&nbsp;in
the case of any criminal proceeding, the director or officer had reasonable cause to believe that
the act or omission was unlawful. However, under Maryland law, a Maryland corporation may not
indemnify for an adverse judgment in a suit by or in the right of the corporation or for a judgment
of liability on
</DIV>

<P align="center" style="font-size: 10pt">&nbsp;
</DIV>

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<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">
<DIV align="left" style="font-size: 10pt; margin-top: 6pt">the basis that a personal benefit was improperly received, unless in either case a court
orders indemnification, and then only for expenses. In addition, Maryland law permits a corporation
to advance reasonable expenses to a director or officer upon the corporation&#146;s receipt of (a)&nbsp;a
written affirmation by the director or officer of his or her good faith belief that he or she has
met the standard of conduct necessary for indemnification by the corporation and (b)&nbsp;a written
undertaking by him or her or on his or her behalf to repay the amount paid or reimbursed by the
corporation if it is ultimately determined that the standard of conduct was not met.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Investment Advisory Agreement provides that, absent willful misfeasance, bad faith or
gross negligence in the performance of its duties or by reason of the reckless disregard of its
duties and obligations, our investment adviser and its officers, managers, agents, employees,
controlling persons, members and any other person or entity affiliated with it are entitled to
indemnification from the Fund for any damages, liabilities, costs and expenses (including
reasonable attorneys&#146; fees and amounts reasonably paid in settlement) arising from the rendering of
the adviser&#146;s services under the Investment Advisory Agreement or otherwise as an investment
adviser of the Fund.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Administration Agreement provides that, absent willful misfeasance, bad faith or gross
negligence in the performance of its duties or by reason of the reckless disregard of its duties
and obligations, the Administrator and its officers, manager, agents, employees, controlling
persons, members and any other person or entity affiliated with it are entitled to indemnification
from the Fund for any damages, liabilities, costs and expenses (including reasonable attorneys&#146;
fees and amounts reasonably paid in settlement) arising from the rendering of the Administrator&#146;s
services under the Administration Agreement or otherwise as administrator for the Fund.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The law also provides for comparable indemnification for corporate officers and agents.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>ITEM 31. BUSINESS AND OTHER CONNECTIONS OF INVESTMENT ADVISER</B>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">Not Applicable
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>ITEM 32. LOCATION OF ACCOUNTS AND RECORDS</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;All accounts, books and other documents required to be maintained by Section 31(a) of the 1940
Act, and the rules thereunder are maintained at the offices of:
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1)&nbsp;the Registrant, 615 East Michigan St., 2<SUP style="font-size: 85%; vertical-align: text-top">nd</SUP> Floor, Milwaukee, WI 53202;
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2)&nbsp;the transfer agent, Computershare Investor Services, LLC, 2 North LaSalle Street,
Chicago, IL 60602;
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3)&nbsp;the Custodian, U.S. Bank, N.A., 425 Walnut Street, Cincinnati, OH 45202; and
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(4)&nbsp;the investment adviser, Pichardo Asset Management, S.A. de C.V., Teopanzolco Avenue #408,
3<SUP style="font-size: 85%; vertical-align: text-top">rd</SUP> Floor, Cuernavaca 62260, Morelos, Mexico.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>ITEM 33. MANAGEMENT SERVICES</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">Not Applicable.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>ITEM 34. UNDERTAKINGS</B>
</DIV>


<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">1.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>The Registrant undertakes to suspend the issuance of Preference Stock until the
Prospectus is amended if (1)&nbsp;subsequent to the effective date of its registration
statement, the net asset value declines more than ten percent from its net asset value
as of the effective date of the registration statement; or (2)&nbsp;the net asset value
increases to an amount greater than the net proceeds as stated in the Prospectus.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">2.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>The Registrant undertakes that:</TD>
</TR>

</TABLE>
</DIV>
<P align="center" style="font-size: 10pt">&nbsp;
</DIV>

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<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">


<DIV style="margin-top: 6pt"><TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">



</TABLE>
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(a)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>For the purpose of determining any liability under the
Securities Act of 1933, the information omitted from the form of Prospectus
filed as part of this registration statement in reliance upon Rule&nbsp;430A and
contained in a form of Prospectus filed by the Registrant pursuant to Rule
497(h) under the Securities Act of 1933 shall be deemed to be part of this
registration statement as of the time it was declared effective.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">(b)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>For the purpose of determining any liability under the
Securities Act of 1933, each post-effective amendment that contains a form of
Prospectus shall be deemed to be a new registration statement relating to the
securities offered therein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof.</TD>
</TR>


</TABLE>
</DIV>
<P align="center" style="font-size: 10pt">&nbsp;
</DIV>

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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">


<DIV style="margin-top: 6pt"><TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">



</TABLE>
</DIV>

<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>SIGNATURES</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As required by the Securities Act of 1933, this registration statement has been signed on
behalf of the registrant, in the City of New York and the State of New York, on the 1st day of
September, 2005.
</DIV>
<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="25%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="35%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="40%">&nbsp;</TD>
</TR>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" valign="top" align="left"><B>MEXICO EQUITY &#038; INCOME FUND, INC.</B></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">By:
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">/s/ Maria Eugenia Pichardo</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Name:
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Maria Eugenia Pichardo</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Title:
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">President</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Each
person whose signature to this Registration Statement appears below hereby appoints Maria
Eugenia Pichardo and Gerald Hellerman and each of them acting singly, as his attorney-in-fact, to
sign on his behalf individually and in the capacity stated below (i)&nbsp;any and all amendments
(including post-effective amendments), supplements and additions to this registration statement,
and (ii)&nbsp;any and all registration statements filed pursuant to Rule&nbsp;462 under the Securities Act,
of Registrant common stock and any and all amendments (including post-effective amendments),
supplements and additions thereto, and to file each of the same, with all exhibits thereto, and all
other documents in connection therewith, with the Securities and Exchange Commission, and hereby
grants to such attorneys-in-fact and agents full power and authority to do and perform each and
every act and thing necessary or advisable to be done in and about the foregoing, as fully to all
intents and purposes as he might or could do in person, hereby ratifying and confirming all that
said attorneys-in-fact and agents or each of them or their substitute or substitutes may lawfully
do or cause to be done by virtue hereof.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As required by the Securities Act of 1933, this registration statement has been signed by the
following persons in the capacities and on the dates indicated:
</DIV>
<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="42%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="26%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="22%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD nowrap align="center"><B>Name</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center"><B>Title</B></TD>
    <TD>&nbsp;</TD>

<TD nowrap align="left">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Date</B></TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px"><B>/s/ Maria Eugenia Pichardo</B>
<DIV style="font-size: 1pt; border-top: 1px solid #000000">&nbsp;</DIV>
<B>Maria Eugenia Pichardo</B>
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">President
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">September&nbsp;1, 2005</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px"><B>/s/ Gerald Hellerman</B>
<DIV style="font-size: 1pt; border-top: 1px solid #000000">&nbsp;</DIV>
<B>Gerald Hellerman</B>
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Director,
Chief Financial
Officer and Chief
Compliance Officer
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">September&nbsp;1, 2005</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px"><B>/s/ Phillip Goldstein</B>
<DIV style="font-size: 1pt; border-top: 1px solid #000000">&nbsp;</DIV>
<B>Phillip Goldstein</B>
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Director
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">September&nbsp;1, 2005</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px"><B>/s/ Rajeev Das</B>
<DIV style="font-size: 1pt; border-top: 1px solid #000000">&nbsp;</DIV>
<B>Rajeev Das</B>
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Director
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">September&nbsp;1, 2005</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px"><B>/s/ Andrew Dakos</B>
<DIV style="font-size: 1pt; border-top: 1px solid #000000">&nbsp;</DIV>
<B>Andrew Dakos</B>
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Director
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">September&nbsp;1, 2005</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px"><B>/s/ Glenn Goodstein</B>
<DIV style="font-size: 1pt; border-top: 1px solid #000000">&nbsp;</DIV>
<B>Glenn Goodstein</B>
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Director
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">September&nbsp;1, 2005</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<P align="center" style="font-size: 10pt">&nbsp;
</DIV>

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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">


<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>Exhibit&nbsp;Index</B>
</DIV>

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="8%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="89%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD nowrap align="left"><B>Exhibit</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD nowrap align="left"><B>Number</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center"><B>Description</B></TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Ex-2.D.1
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Form of Preference Common Stock Certificate**</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Ex-2.D.2
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Form of Preference Common Stock Purchase Form**</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Ex-2.D.3
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Form of Beneficial Owners Election Form**</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Ex-2.D.4
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Form of Nominee Holder Over-Subscription Form**</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Ex-2.G
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Investment Advisory Agreement between Registrant and Pichardo Asset Management,
S.A. de C.V.**</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Ex-2.J
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Custodian Agreement between Registrant and U.S. Bank, N.A.**</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Ex-2.K.1
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Administration Agreement between Registrant and U.S. Bancorp Fund Services, LLC**</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Ex-2.K.2
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Transfer Agency and Service Agreement between Registrant and Computershare
Investors Services, LLC**</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Ex-2.L
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Opinion and Consent of Blank Rome LLP, counsel for Registrant**</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Ex-2.N
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Consent of Tait, Weller &#038; Baker LLP, the independent registered public
accounting firm for Registrant</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Ex-2.R
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    <TD align="left" valign="top">Codes of Ethics of Registrant**</TD>
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    <TD>To be filed by amendment.</TD>
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<TYPE>EX-2.N
<SEQUENCE>2
<FILENAME>c98194exv2wn.htm
<DESCRIPTION>CONSENT OF TAIT, WELLER & BAKER LLP
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<DIV align="right" style="font-size: 10pt; margin-top: 12pt">EXHIBIT 2.N
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<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><U><B>CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM</B></U>
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<DIV align="left" style="font-size: 10pt; margin-top: 6pt">We consent to the references to our firm in this Registration Statement (Form N-2) of the
Mexico Equity &#038; Income Fund, Inc. and to the use of our report dated September&nbsp;17, 2004 on the
financial statements and financial highlights of the Mexico Equity &#038; Income Fund, Inc. Such
financial statements and financial highlights appear in the 2004 Annual Report to Shareholders
which is incorporated by reference in the Registration Statement.
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<DIV align="left" style="font-size: 10pt; margin-top: 6pt">/s/ Tait, Weller &#038; Baker LLP

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<DIV align="left" style="font-size: 10pt; margin-top: 6pt">Philadelphia, PA<BR>
September&nbsp;1, 2005

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