SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934
Filed by Registrant [ X ]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted by
Rule 14a-6(e)(2))
[ X ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Sec. 240.14a-12
BOULDER GROWTH & INCOME FUND, INC.
(Name of Registrant as Specified In Its Charter)
Stephen C. Miller
2344 Spruce Street, Suite A
Boulder, Colorado 80302
(303) 442-2156
(Name of Person(s) Filing Proxy Statement)
Payment of Filing Fee (Check the appropriate box):
[ X ] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
1) Title of each class of securities to which transactions applies:
2) Aggregate number of securities to which transaction applies:
3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which
the filing fee is calculated and state how it was determined):
4) Proposed maximum aggregate value of transaction:
5) Total fee paid:
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange
Act Rule 0-11(a)(2) and identity the filing for which the offsetting
fee was paid previously. Identify the previous filing by registration
statement number, or the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
2) Form, Schedule or Registration Statement No.:
3) Filing Party:
4) Date Filed:
[GRAPHIC OMITTED] BOULDER GROWTH & INCOME FUND, INC.
2344 SPRUCE STREET, SUITE A
BOULDER, COLORADO 80302
March 8, 2007
Dear Fellow Stockholder,
You are cordially invited to attend the 2007 Annual Meeting of Stockholders
of Boulder Growth & Income Fund, Inc., which will be held on April 27, 2007 at
9:00 a.m. Mountain Standard Time (local time), at the Scottsdale Plaza Resort,
7200 North Scottsdale Road, Scottsdale, Arizona. Details of the business to be
presented at the meeting can be found in the accompanying Notice of Annual
Meeting and Proxy Statement.
There are two proposals contained in this Proxy. The first, Proposal 1, is
for the annual election of Directors.
There is also one non-routine proposal contained in this Proxy, Proposal 2,
which changes the Fund's current industry concentration policy and clarifies and
expands the scope of real estate companies that can be included in determining
the threshold under the Fund's investment restriction regarding industry
concentration.
Under its present investment restriction, the Fund cannot invest more than
25% of its assets in the same industry except with respect to real estate
investment trusts ("REITs") and related companies in the same industry as REITS
(the "Industry Restriction"). In addition, the Fund has adopted a policy to
concentrate in REITs and related companies pursuant to which it must, under
normal market conditions, invest more than 25% of its assets in REITs and
related companies. Proposal 2 amends the Industry Restriction so that the Fund
is permitted to include a broader range of real estate related companies in
determining compliance with the Industry Restriction rather than solely REITs
and related companies. Proposal 2 designates "real estate related companies"
rather than REITs as the "industry" with respect to which the Fund can exceed
the 25% limitation. "Real estate related companies" would include REITs, but
would also include a much broader range of equity and/or debt securities of
companies in or primarily servicing the real estate industry or deriving a
substantial portion of their revenue from, or having a substantial portion of
their assets invested in, real estate. Proposal 2 is a change to a fundamental
investment policy of the Fund and thus its adoption requires the affirmative
vote of a majority of the Fund's stockholders. See Vote Required on page 9.
As Chairman of the Board, I encourage you to support each of the proposals.
After careful review by those Directors who are not "interested persons" as
defined in the Investment Company Act of 1940 (the "Independent Directors"), the
Board of Directors unanimously approved and has recommended to stockholders that
they approve each of the proposals.
We hope you plan to attend the meeting. Your vote is important. Whether or
not you are able to attend, it is important that your shares be represented at
the Meeting. At your earliest convenience, we ask that you please complete,
sign, date and return the enclosed Proxy Card or authorize proxies via telephone
or the Internet to cast your vote at the meeting.
On behalf of the Board of Directors and the management of Boulder Growth &
Income Fund, Inc., I extend our appreciation for your continued support.
Sincerely,
/s/ Joel W. Looney
Joel W. Looney
Chairman of the Board
[GRAPHIC OMITTED] BOULDER GROWTH & INCOME FUND, INC.
2344 SPRUCE STREET, SUITE A
BOULDER, COLORADO 80302
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
To Be Held on April 27, 2007
To the Stockholders:
Notice is hereby given that the Annual Meeting of Stockholders of Boulder
Growth & Income Fund, Inc. (the "Fund"), a Maryland corporation, will be held at
the Scottsdale Plaza Resort, 7200 North Scottsdale Road, Scottsdale, Arizona at
9:00 a.m. Mountain Standard Time (local time), on April 27, 2007 to consider and
vote on the following Proposals, all of which are more fully described in the
accompanying Proxy Statement:
1. The election of Directors of the Fund (Proposal 1).
2. An amendment to the Fund's fundamental investment restriction
regarding industry concentration (Proposal 2).
3. To transact such other business as may properly come before the
Meeting or any adjournments and postponements thereof.
The Board of Directors of the Fund has fixed the close of business on
February 28, 2007 as the record date for the determination of stockholders of
the Fund entitled to notice of and to vote at the Annual Meeting and any
postponements or adjournments thereof. This Proxy Statement, Notice of Annual
Meeting and proxy card are first being mailed to stockholders on or about
March 9, 2007.
By Order of the Board of Directors,
/s/ Stephanie Kelley
STEPHANIE KELLEY
Secretary
March 8, 2007
--------------------------------------------------------------------------------
STOCKHOLDERS ARE REQUESTED TO COMPLETE, SIGN AND DATE THE ENCLOSED PROXY CARD OR
AUTHORIZED PROXIES VIA TELEPHONE OR THE INTERNET. THE PROXY CARD SHOULD BE
RETURNED IN THE ENCLOSED ENVELOPE, WHICH NEEDS NO POSTAGE IF MAILED IN THE
UNITED STATES. INSTRUCTIONS FOR THE PROPER EXECUTION OF PROXIES ARE SET FORTH ON
THE INSIDE COVER.
--------------------------------------------------------------------------------
INSTRUCTIONS FOR SIGNING PROXY CARDS
The following general rules for signing proxy cards may be of assistance to
you and may avoid the time and expense to the Fund involved in validating your
vote if you fail to sign your proxy card properly.
1. Individual Accounts: Sign your name exactly as it appears in the
registration on the proxy card.
2. Joint Accounts: Either party may sign, but the name of the party signing
should conform exactly to a name shown in the registration.
3. All Other Accounts: The capacity of the individual signing the proxy
card should be indicated unless it is reflected in the form of registration. For
example:
Registration Valid Signature
Corporate Accounts
(1) ABC Corp. ABC Corp.
(2) ABC Corp. John Doe, Treasurer
(3) ABC Corp., c/o John Doe Treasurer John Doe
(4) ABC Corp. Profit Sharing Plan John Doe, Trustee
Trust Accounts
(1) ABC Trust Jane B. Doe, Trustee
(2) Jane B. Doe, Trustee, u/t/d 12/28/78 Jane B. Doe
Custodian or Estate Accounts
(1) John B. Smith, Cust., John B. Smith
f/b/o John B. Smith, Jr. UGMA
(2) John B. Smith John B. Smith, Jr., Executor
[GRAPHIC OMITTED] BOULDER GROWTH & INCOME FUND, INC.
2344 SPRUCE STREET, SUITE A
BOULDER, COLORADO 80302
QUESTIONS & ANSWERS REGARDING THE MEETING AND PROPOSALS
Question 1: What is the purpose of the Annual Meeting?
Answer: At the Meeting, stockholders will be asked to vote on the election of
directors and to approve or disapprove amendments to the Fund's fundamental
investment restriction regarding industry concentration.
Question 2: Who is being nominated for election at the Meeting?
Answer: The Board has nominated the following five Directors, each to serve a
one-year term until the annual meeting in 2008 and until their successors are
duly elected and qualify: Richard I. Barr, Joel W. Looney, Dr. Dean L. Jacobson,
John S. Horejsi, and Susan L. Ciciora. The holders of Common Stock will elect
three of the five directors standing for election and the holders of the AMPS
will elect the remaining two directors. Mr. Barr and Mr. Horejsi are being
nominated to represent the interests of the holders of the AMPS.
Question 3: What is the purpose of Proposal 2 regarding an amendment to the
Fund's fundamental investment restriction regarding industry concentration?
Answer: At the April 22, 2003 annual meeting of stockholders, the stockholders
approved an amendment to the Fund's fundamental investment restriction regarding
industry concentration (the "Industry Restriction") to permit the Fund to invest
more than 25% of its assets in real estate investment trusts ("REITs") and
related companies in the same industry classification as REITs. In connection
with adopting the Industry Restriction, the Fund also adopted a policy pursuant
to which it would be required, under normal market conditions, to invest more
than 25% of its assets in REITs and related companies. Although the current
language of the Industry Restriction permits the Fund to invest in real estate
companies other than REITs and count such companies in its determination of
compliance with the Industry Restriction, management of the Fund would like
clarify and broaden the types of investments that may be made by the Fund and
included in such determination.
Proposal 2 asks stockholders to approve an amendment to the Industry Restriction
which would permit the Fund to invest greater than 25% of its assets in "real
estate related companies" rather than solely REITs and related companies. Under
the Proposal, "real estate related companies" would be defined as (i) companies
in or primarily servicing the real estate industry or (ii) companies deriving at
least 50% of their revenue from, or having at least 50% of their assets invested
in, real estate (as determined in good faith by the Fund's advisers based on
current financial statements of each issuer) (collectively, "Real Estate Related
Companies"). Real Estate Related Companies would include, but not be limited to:
REITs and other closed-end registered investment companies that invest primarily
in REITs; home builders; real estate developers; property management companies;
real estate brokerage companies; commercial and industrial construction
companies; financial companies who make or service real estate mortgages and/or
construction loans; title, homeowners and builders risk insurance companies;
manufacturers, distributors and retailers of construction materials and/or
building supplies; lumber, paper, forest products, and other companies with
significant real estate holdings; holding companies of any of these companies;
and any other companies that the Fund's advisers reasonably determine are Real
Estate Related Companies. If Proposal 2 is approved, the Fund will be required,
under normal market conditions, to invest more than 25% of its assets in Real
Estate Related Companies.
Proposal 2 is a change to a fundamental investment policy of the Fund and thus
its adoption requires the affirmative vote of a majority of the Fund's
stockholders. See Vote Required on page 9.
Question 4: How does the Board recommend that stockholders vote on the
proposals?
Answer: The Board, including all of the non-interested Directors, has
unanimously recommended that stockholders vote FOR both of the Proposals. If no
instructions are indicated on your proxy, the representatives holding proxies
will vote in accordance with the recommendations of the Board.
Question 5: Who is entitled to vote?
Answer: Stockholders of record at the close of business on February 28, 2007
(the "Record Date") are entitled to notice of and to vote at the Meeting and any
postponements or adjournments thereof. Each of the shares outstanding on the
Record Date is entitled to one vote on each of the Proposals.
Question 6: What is the required quorum for the Meeting?
Answer: The holders of at least a majority of the outstanding shares of stock
(without regard to class) of the Fund must be represented at the Meeting, either
in person or by proxy, in order to constitute a quorum permitting business to be
conducted at the Meeting. If you have completed, executed and returned valid
proxies (in writing, by phone or by Internet) or attend the Meeting and vote in
person, your shares will be counted for purposes of determining whether there is
a quorum, even if you abstain from voting on any or all matters introduced at
the Meeting.
Question 7: How do I vote?
Answer: Your vote is very important. Stockholders can vote in person at the
Meeting or authorize proxies to cast their votes ("proxy voting") by proxy. Most
stockholders will have a choice of proxy voting over the Internet at
http://www.proxyvote.com, by using a toll-free telephone number or by completing
and signing a Proxy Card and mailing it in the postage-paid envelope provided.
Please refer to your Proxy Card or the information forwarded by your bank,
broker or other nominee to see which options are available to you. If you proxy
vote by Internet or telephone, you do NOT need to return your Proxy Card. If you
vote by proxy, the individuals named on the Proxy Card as proxy holders will
vote your shares in accordance with your instructions. You may specify whether
your shares should be voted for all, some or none of the nominees for director
and whether your shares should be voted for or against the other proposals. If
you execute an otherwise valid proxy but do not provide voting instructions, the
persons named as proxies or their substitutes will cast your votes FOR all of
the Proposals.
Question 8: Can I revoke or change my proxy?
Answer: Yes. You may change or revoke your proxy at any time before the Meeting
by timely delivery of a properly executed, later-dated proxy (including an
Internet or phone proxy), by sending a written revocation to the Secretary of
the Fund at the Fund's address listed on the accompanying Notice of Meeting, or
by attending and voting in person at the Meeting. The powers of the proxy
holders will be suspended with respect to your shares if you attend the meeting
in person and revoke your proxy, but attendance at the Meeting will not by
itself revoke a previously granted proxy.
[GRAPHIC OMITTED] BOULDER GROWTH & INCOME FUND, INC.
2344 SPRUCE STREET, SUITE A
BOULDER, COLORADO 80302
ANNUAL MEETING OF STOCKHOLDERS
April 27, 2007
PROXY STATEMENT
This proxy statement ("Proxy Statement") for Boulder Growth & Income Fund,
Inc., a Maryland corporation ("BIF" or the "Fund"), is furnished in connection
with the solicitation of proxies by the Fund's Board of Directors (collectively,
the "Board" and individually, the "Directors") for use at the Annual Meeting of
Stockholders of the Fund to be held on Friday, April 27, 2007, at 9:00 a.m.
Mountain Standard Time (local time), at the Scottsdale Plaza Resort, 7200 N.
Scottsdale Drive, Scottsdale, Arizona, and at any adjournments and postponements
thereof (the "Meeting"). A Notice of Annual Meeting of Stockholders and proxy
card accompany this Proxy Statement. Proxy solicitations will be made, beginning
on or about March 9, 2007, primarily by mail, but proxy solicitations may also
be made by telephone, by Internet on the Fund's website, or telegraph or
personal interviews conducted by officers of the Fund, Morrow & Co., Inc., the
proxy solicitor for the Fund, and PFPC Inc., the transfer agent of the Fund. The
costs of proxy solicitation and expenses incurred in connection with the
preparation of this Proxy Statement and its enclosures are expected to be
approximately $15,000 and will be paid by the Fund. The Fund also will reimburse
brokerage firms and others for their expenses in forwarding solicitation
material to the beneficial owners of its shares. The Board has fixed the close
of business on February 28, 2007 as the record date (the "Record Date") for the
determination of stockholders entitled to notice of and to vote at the Meeting
and any postponements or adjournments thereof.
The Annual Report of the Fund, including audited financial statements for
the fiscal year ended November 30, 2006, has been mailed to stockholders.
Additional copies are available upon request, without charge, by calling
1-800-331-1710. The report is also viewable online at the Fund's website at
www.boulderfunds.net. The report is not to be regarded as proxy solicitation
material.
Boulder Investment Advisers, L.L.C. ("BIA"), 2344 Spruce Street, Suite A,
Boulder, Colorado 80302 and Stewart Investment Advisers ("SIA"), Bellerive,
Queen Street, St. Peter, Barbados, currently serve as co-investment advisers to
the Fund. BIA and SIA are collectively referred to herein as the "Advisers".
Fund Administrative Services, L.L.C., serves as co-administrator to the Fund and
is located at 2344 Spruce Street, Suite A, Boulder, Colorado 80302. Investors
Bank & Trust Company ("IBT") acts as the co-administrator to the Fund and is
located at 200 Clarendon Street, Boston, Massachusetts 02116. PFPC Inc. ("PFPC")
acts as the transfer agent to the Fund and is located at 4400 Computer Drive,
Westborough, Massachusetts 01581.
If the enclosed proxy is properly executed and returned by April 27, 2007
in time to be voted at the Meeting, the Shares (as defined below) represented
thereby will be voted in accordance with the instructions marked thereon. Unless
instructions to the contrary are marked thereon, a proxy will be voted FOR the
election of the nominees for Directors, FOR each of the other Proposals and, in
the discretion of the proxy holders, on any other matters that may properly come
before the Meeting. Any stockholder who has given a proxy has the right to
revoke it at any time prior to its exercise either by attending the Meeting and
casting his or her votes in person or by submitting a letter of revocation or a
later-dated proxy to the Fund's Secretary at the above address prior to the date
of the Meeting.
A quorum of the Fund's stockholders is required for the conduct of business
at the Meeting. Under the Bylaws of the Fund, a quorum is constituted by the
presence in person or by proxy of the holders of a majority of the outstanding
shares (without regard to class) of the Fund as of the Record Date. In the event
that a quorum is not present at the Meeting, or in the event that a quorum is
present but sufficient votes to approve one or more proposals are not received,
the persons named as proxies may propose and vote for one or more adjournments
of the Meeting to permit further solicitation of proxies with respect to any
proposal that did not receive the votes necessary for its passage. With respect
to those proposals for which there is represented a sufficient number of votes
in favor, actions taken at the Meeting will be approved and implemented
irrespective of any adjournments with respect to any other proposals. Any such
adjournment will require the affirmative vote of a majority of votes cast on the
matter at the Meeting. If a quorum is present, the persons named as proxies will
vote those proxies which they are entitled to vote FOR any proposal in favor of
such an adjournment and will vote those proxies required to be voted AGAINST any
proposal against any such adjournment.
The Fund has two classes of stock: common stock, par value $0.01 per share (the
"Common Stock") and preferred stock, par value $0.01 per share (the "Preferred
Stock".), 1,000 shares of which have been designated as Auction Market Preferred
Stock (the "AMPS") (the Common Stock and AMPS are collectively referred to
herein as the "Shares"). On the Record Date, the following number of Shares of
the Fund were issued and outstanding:
Common Stock AMPs
Outstanding Outstanding
11,372,025 1,000
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS. The following table sets
forth certain information regarding the beneficial ownership of the Shares as of
the Record Date by each person who may be deemed by the Fund to beneficially own
5% or more of the Common Stock.
Name of Owner* Number of Shares Number of Shares Percentage
Directly Owned Beneficially Owned Beneficially Owned
------------------------------------- ------------------ ---------------------- -----------------------
Ernest Horejsi Trust No. 1B 2,375,911 2,375,911 20.89%
Badlands Trust Company --- ---** 20.89%
Stewart R. Horejsi Trust No. 2 --- ---** 20.89%
Aggregate Shares Owned by Horejsi 2,375,911 2,375,911 20.89%
Affiliates (defined below)**
------------------------------------- ------------------ ---------------------- -----------------------
Phillip Goldstein and Andrew 655,000 655,000 5.76%
Dakos***
------------------------------------- ------------------ ---------------------- -----------------------
* The address of each listed Trust is c/o Badlands Trust Company, LLC, 3301 C
Street, Suite 100, Anchorage, AK 99503.
** Excludes shares owned by the Ernest Horejsi Trust No. 1B (the "EH Trust").
Badlands Trust Company, LLC ("Badlands") is one of three trustees of the EH
Trust. Badlands is a trust company organized under the laws of Alaska and
is wholly owned by the Stewart R. Horejsi Trust No. 2, an irrevocable trust
organized by Stewart R. Horejsi for the benefit of his issue. The Managers
of Badlands are Larry Dunlap, Stephen C. Miller, Laura Tatooles, Laura
Rhodenbaugh and Ron Kukes. Badlands and its managers disclaim beneficial
ownership of shares owned by the EH Trust. Together with Larry Dunlap and
Badlands, Ms. Ciciora is a trustee of the EH Trust and also one of the
beneficiaries of the EH Trust. Mr. Miller is an officer and President of
Badlands. Because two of the Trust's trustees are required in order for the
Trust to vote or exercise dispositive authority with respect to shares
owned by the Trust, Ms. Ciciora and Mr. Miller each disclaim beneficial
ownership of such shares.
*** As stated in Schedule 13D Amendment No. 8 filed with the Securities and
Exchange Commission on December 4, 2006.
----------------------------
The EH Trust, Badlands and the Stewart R. Horejsi Trust No. 2, as well as
other Horejsi affiliated trusts and entities are collectively referred to herein
as the "Horejsi Affiliates". Information as to beneficial ownership in the
previous paragraph has been obtained from a representative of the beneficial
owners; all other information as to beneficial ownership is based on reports
filed with the Securities and Exchange Commission (the "SEC") by such beneficial
owners.
As of the Record Date, Cede & Co., a nominee partnership of the Depository
Trust Company, held of record, but not beneficially, 10,621,351 shares or 93.40%
of Common Stock outstanding of the Fund.
As of the Record Date, the executive officers and directors of the Fund, as
a group, owned 2,410,425 shares of Common Stock (this amount includes the
aggregate shares of Common Stock owned by the Horejsi Affiliates set forth
above) and 0 shares of AMPS, representing 21.20% of Common Stock outstanding and
0% of AMPS.
In order that your Shares may be represented at the Meeting, you are
requested to vote on the following matters:
PROPOSAL 1
ELECTION OF DIRECTORS OF THE FUND
The Charter provides that all of the Directors stand for election each
year. The Board has nominated the following five Director nominees to stand for
election, each for a one-year term and until their successors are duly elected
and qualify: Richard I. Barr, Joel W. Looney, Dr. Dean L. Jacobson., John S.
Horejsi, and Susan L. Ciciora. Only the Common Stock holders are entitled to
vote for the election of Messrs. Looney and Jacobson and Ms. Ciciora, and only
the AMPS holders are entitled to vote on the election of Messrs. Barr and
Horejsi. On October 13, 2006, Dennis Causier submitted his resignation as a
Director of the Fund. The remaining Directors of the Fund accepted Mr. Causier's
resignation and, at the subsequent regularly scheduled Board meeting held on
October 23, 2006, nominated Susan L. Ciciora as Mr. Causier's replacement. Ms.
Ciciora is the daughter of Stewart Horejsi, an agent and beneficiary of the
Fund's largest stockholder (the EH Trust defined above), and will be an
interested Director of the Fund. The above nominees have consented to serve as
Directors if elected at the Meeting for the one-year term. If the designated
nominees decline or otherwise become unavailable for election, however, the
proxy confers discretionary power on the persons named therein to vote in favor
of a substitute nominee or nominees for the Board.
INFORMATION ABOUT DIRECTORS AND OFFICERS. Set forth in the following table
is information about the nominees for election to the Board of Directors:
------------------------------ ------------------------ ---------------------------------------------- ------------------
Name, Address*, Age Position, Length of Principal Occupation(s) and Other Number of Funds
Term Served, and Term Directorships Held During the Past Five Years in Fund Complex+
of Office Overseen by
Director
------------------------------ ------------------------ ---------------------------------------------- ------------------
Independent Directors
Joel W. Looney, Director of the Fund Partner, Financial Management Group, LLC 3
Chairman since 2002. Chairman (investment adviser), since July 1999; CFO,
Age: 44 of the Board of the Bethany College,1995-1999; Director, Boulder
Fund since 2004. Total Return Fund, Inc., since 2001;
Current Nominee for a Director and Chairman of the Board, First
term to expire at the Financial Fund, Inc., since 2003.
2008 annual meeting.
Dr. Dean L. Jacobson Director of the Fund Founder and President of Forensic 3
Age: 68 since 2006. Current Engineering, Inc. (engineering
Nominee for a term to investigations); Professor Emeritus at
expire at the 2008 Arizona State University, since 1997;
annual meeting. Professor of Engineering at Arizona State
University, prior to 1997; Director, Boulder
Total Return Fund, Inc., since 2004;
Director, First Financial Fund, Inc., since
2003.
Richard I. Barr Director of the Fund Retired. Manager, Advantage Sales and 3
Age: 69 since 2002. Current Marketing, Inc. (food brokerage), 1963-2001;
Nominee for a term to Director, Boulder Total Return Fund, Inc.,
expire at the 2008 since 1999 and Chairman of the Board since
annual meeting. 2003; Director, First Financial Fund, Inc.,
since 2001.
------------------------------ ------------------------ ---------------------------------------------- ------------------
Interested Directors**
------------------------------ ------------------------ ---------------------------------------------- ------------------
John S. Horejsi Director of the Fund Director, Horejsi Charitable Foundation 3
Age: 39 since 2004. Current (private charitable foundation), since 1997;
nominee for a term to Director, Boulder Total Return Fund, Inc.
expire at the 2008 and First Financial Fund, Inc., since 2006.
annual meeting.
Susan L. Ciciora Director of the Fund Trustee of the Lola Brown Trust No. 1B and 3
Age: 42 since 2006. Current the Ernest Horejsi Trust No. 1B; Director,
nominee for a term to Horejsi Charitable Foundation, Inc. (private
expire at the 2008 charitable foundation), since 1997;
annual meeting. Director, Boulder Total Return Fund, Inc.,
since 2001; Director, First Financial Fund,
Inc., since 2003
* Unless otherwise specified, the Directors' respective addresses are c/o
Boulder Growth & Income Fund, Inc., 2344 Spruce Street, Suite A, Boulder,
Colorado 80302.
** Mr. Horejsi and Ms. Ciciora are each "interested persons" as a result of
the extent of their beneficial ownership of Fund shares and by virtue of
their indirect beneficial ownership of BIA and FAS.
+ Includes the Fund, Boulder Total Return Fund, Inc. and First Financial
Fund, Inc.
----------------------------
From the late 1980's until January, 2001, Mr. Looney served, without
compensation, as one of three trustees of the Mildred Horejsi Trust, an
affiliate of the EH Trust.
The names of the executive officers of the Fund are listed in the table
below. Each officer was elected to office by the Board at a meeting held on
April 24, 2006. This table also shows certain additional information. Officers
are elected annually and each officer will hold such office until a successor
has been elected by the Board.
------------------------------ -------------------------- ----------------------------------------------------------
Position, Length of
Name, Address, Age Term Served, and Term of Principal Occupation(s) and Other Directorships held
Office During the Past Five Years
------------------------------ -------------------------- ----------------------------------------------------------
Stephen C. Miller President of the Fund President of and General Counsel for BIA, since 1999;
2344 Spruce Street, since 2002 and Director Manager, Fund Administrative Services, LLC ("FAS"),
Suite A from 2002 through since 1999; Vice President of SIA, since 1999; Director
Boulder, CO 80302 October 2004. Appointed and President of Boulder Total Return Fund, Inc., since
Age: 54 annually. 1999 (resigned as Director in 2004); Director and
President of First Financial Fund, Inc., since 2003 (resigned
as Director and Chairman in 2004); President and General
Counsel, Horejsi, Inc. (liquidated in 1999); General Counsel,
Brown Welding Supply, LLC (sold in 1999); officer of various
other Horejsi Affiliates; Of Counsel, Krassa & Miller, LLC,
since 1991.
Carl D. Johns Chief Financial Officer, Vice President and Treasurer of BIA and Assistant
2344 Spruce Street, Chief Accounting Manager of FAS, since 1999; Vice President, Chief
Suite A Officer, Vice President Financial Officer and Chief Accounting Officer, Boulder
Boulder, CO 80302 and Treasurer since Total Return Fund, Inc., since 1999 and First Financial
Age: 44 2002. Appointed Fund, Inc., since 2003.
annually.
Stephanie J. Kelley Secretary since 2002. Secretary, Boulder Total Return Fund, Inc., since 2000
2344 Spruce Street, Appointed annually. and First Financial Fund, Inc., since 2003; Assistant
Suite A Secretary and Assistant Treasurer of various other
Boulder, CO 80302 entities affiliated with the Horejsi family; employee of
Age: 50 FAS, since 1999.
Nicole L. Murphey Assistant Secretary Assistant Secretary, Boulder Total Return Fund, Inc.
2344 Spruce Street, since 2002. Appointed since 2000 and First Financial Fund, Inc. since 2003;
Suite A annually. employee of FAS, since 1999.
Boulder, CO 80302
Age: 30
Set forth in the following table are the nominees for election to the Board
together with the dollar range of equity securities beneficially owned by each
Director as of the Record Date, as well as the aggregate dollar range of the
Fund's equity securities in all funds overseen in a family of investment
companies (i.e., other funds managed by BIA and SIA (collectively, the
"Advisers")).
OWNERSHIP OF THE FUND BY DIRECTORS
-------------------------------------- -------------------------------- ---------------------------------
Independent Directors and Nominees Dollar Range of Equity Aggregate Dollar Range of
Securities in the Fund Equity Securities in All Funds
in the Family of Investment
Companies
-------------------------------------- -------------------------------- ---------------------------------
Richard I. Barr $10,001 to $50,000 Over $100,000
Joel W. Looney $50,001 to $100,000 Over $100,000
Dean L. Jacobson $10,001 to $50,000 $50,001 to $100,000
---------------------------------------------------------------------------------------------------------
Interested Directors and Nominees
-------------------------------------- -------------------------------- ---------------------------------
John S. Horejsi Over $100,000+ Over $100,000
Susan L. Ciciora Over $100,000+ Over $100,000
+ 2,375,911 Shares of the Fund are held by the EH Trust. Ms. Ciciora is a
trustee and beneficiary under the EH Trust and John Horejsi is a
beneficiary under the EH Trust. Accordingly, Ms. Ciciora and Mr. Horejsi
may be deemed to have indirect beneficial ownership of the Shares held by
the EH Trust. Ms. Ciciora and Mr. Horejsi disclaim all such beneficial
ownership. Ms. Ciciora directly owns 9,000 shares of the Fund. Mr. Horejsi
does not directly own any shares of the Fund.
---------------------------
None of the independent Directors or their family members owned
beneficially or of record any securities of the Advisers or any person directly
or indirectly controlling, controlled by, or under common control with the
Advisers.
DIRECTOR AND OFFICER COMPENSATION. The following table sets forth certain
information regarding the compensation of the Fund's Directors for the fiscal
year ended November 30, 2006. No persons (other than the non-interested
Directors, as set forth below) currently receive compensation from the Fund for
acting as a Director or officer. Directors and executive officers of the Fund do
not receive pension or retirement benefits from the Fund. Non-interested
Directors receive reimbursement for travel and other out of pocket expenses
incurred in connection with Board meetings.
Aggregate
Compensation
Name of Person and Position with the from the Fund Total Compensation from
Fund Paid to the Fund and Fund Complex
Directors Paid to Directors
----------------------------------------- ------------------- ----------------------------
Richard I. Barr, Director $24,000 $84,000
(3 funds)
Dr. Dean Jacobson, Director $15,826 $71,826
(3 funds)
Joel W. Looney, Director and Chairman $31,000 $97,000
of the Board (3 funds)
Susan L. Ciciora, Director $0 $0
John S. Horejsi, Director $0 $0
Each Director of the Fund who was not a Director, officer or employee of
one of the Advisers, or any of their affiliates, receives a fee of $8,000 per
annum plus $3,000 for each in person meeting, $500 for each Audit Committee
meeting and $500 for each telephonic meeting of the Board. In addition, the
Chairman of the Board and the Chairman of the Audit Committee receives $1,000
per meeting. Each non-interested Director of the Fund is reimbursed for travel
and out-of-pocket expenses associated with attending Board and Committee
meetings. The Board held nine meetings (five of which were held by telephone
conference call) during the fiscal year ended November 30, 2006. Each Director
currently serving in such capacity for the entire fiscal year attended at least
75% of the meetings of Directors and any Committee of which he is a member. The
aggregate remuneration paid to the Directors of the Fund for acting as such
during the fiscal year ended November 30, 2006 amounted to $89,749.17.
COMMITTEES OF THE BOARD OF DIRECTORS
AUDIT COMMITTEE; REPORT OF AUDIT COMMITTEE. The purpose of the Audit
Committee is to assist Board oversight of the integrity of the Fund's financial
statements, the Fund's compliance with legal and regulatory requirements, the
independent auditor's qualifications and independence and the performance of the
Fund's independent auditors. The Audit Committee reviews the scope and results
of the Fund's annual audit with the Fund's independent accountants and
recommends the engagement of such accountants. Management, however, is
responsible for the preparation, presentation and integrity of the Fund's
financial statements, and the independent accountants are responsible for
planning and carrying out proper audits and reviews. The Board of Directors
adopted a written charter for the Audit Committee on January 23, 2002 and most
recently amended the Charter on January 23, 2004. A copy of the Audit Committee
Charter is attached as Exhibit A.
The Audit Committee is composed entirely of the Fund's independent
Directors, consisting of Messrs. Jacobson, Barr, and Looney. The Board of
Directors has determined that Joel Looney qualifies as an "audit committee
financial expert," as defined under the Securities and Exchange Commission's
Regulation S-K, Item 401(h). The Audit Committee is in compliance with
applicable rules of the listing requirements for closed-end fund audit
committees; including the requirement that all members of the audit committee be
"financially literate" and that at least one member of the audit committee have
"accounting or related financial management expertise," as determined by the
Board. The Audit Committee is required to conduct its operations in accordance
with applicable requirements of the Sarbanes-Oxley Act and the Public Company
Accounting Oversight Board, and the members of the Audit Committee are subject
to the fiduciary duty to exercise reasonable care in carrying out their duties.
Each member of the Audit Committee is independent, as that term is defined by
the NYSE Listing Standards. The Audit Committee met three times during the
fiscal year ended November 30, 2006.
In connection with the audited financial statements as of and for the
period ended November 30, 2006 included in the Fund's Annual Report for the
period ended November 30, 2006 (the "Annual Report"), at meetings held on
January 17, 2006 and January 26, 2007, the Audit Committee considered and
discussed the audited financial statements with management and the independent
accountants, and discussed the audit of such financial statements with the
independent accountants.
The Audit Committee has received the written disclosures and letter from
the independent accountants required by Independence Standards Board Standard
No. 1 (Independence Discussions with Audit Committees) and has discussed with
independent accountants their independence. The Audit Committee discussed with
the independent accountants the accounting principles applied by the Fund and
such other matters brought to the attention of the Audit Committee by the
independent accountants required by Statement of Auditing Standards No. 61,
Communications With Audit Committees, as currently modified or supplemented.
The members of the Audit Committee are not professionally engaged in the
practice of auditing or accounting and are not employed by the Fund in any
accounting, financial management or internal control capacity. Moreover, the
Audit Committee relies on and makes no independent verification of the facts
presented to it or representations made by management or the independent
accountants. Accordingly, the Audit Committee's oversight does not provide an
independent basis to determine that management has maintained appropriate
accounting and financial reporting principles and policies, or internal controls
and procedures, designed to assure compliance with accounting standards and
applicable laws and regulations. Furthermore, the Audit Committee's
considerations and discussions referred to above do not provide assurance that
the audit of the Fund's financial statements has been carried out in accordance
with generally accepted accounting standards or that the financial statements
are presented in accordance with generally accepted accounting principles.
Based on its consideration of the audited financial statements and the
discussions referred to above with management and the independent accountants
and subject to the limitation on the responsibilities and role of the Audit
Committee set forth in the charter and those discussed above, the Audit
Committee of the Fund recommended to the Board that the audited financial
statements be included in the Fund's Annual Report and be mailed to stockholders
and filed with the SEC.
Submitted by the Audit Committee of the Fund's Board of Directors:
Richard I. Barr
Dean L. Jacobson
Joel W. Looney
NOMINATING COMMITTEE. The Board of Directors has a nominating committee
(the "Nominating Committee") consisting of Messrs. Looney, Jacobson and Barr,
which is responsible for considering candidates for election to the Board in the
event a position is vacated or created. Each member of the Nominating Committee
is independent, as that term is defined by the NYSE Listing Standards. The
Nominating Committee met once during the fiscal year ended November 30, 2006. On
October 13, 2006, Dennis Causier of Mallorca, Spain, submitted his resignation
as a director of the Fund. The remaining Directors accepted Mr. Causier's
resignation and, at the subsequent regularly scheduled Board meeting held on
October 23, 2006, nominated Susan L. Ciciora as Mr. Causier's replacement. The
Nominating Committee noted that Ms. Ciciora was the daughter of Stewart Horejsi,
the Fund's portfolio manager and an agent and beneficiary of the Fund's largest
stockholder (the EH Trust defined above). The Nominating Committee also noted
that Ms. Ciciora was a trustee and beneficiary of the EH Trust. Accordingly, Ms.
Ciciora would be considered an interested Director of the Fund. At this meeting,
the Nominating Committee considered the qualifications and determined the
suitability of Susan L. Ciciora to be Director and resolved to recommend Ms.
Ciciora to stockholders for election at the 2007 Annual Meeting. The Board of
Directors has adopted a charter for the Nominating Committee that is available
on the Fund's website, www.boulderfunds.net.
The Nominating Committee does not have a formal process for identifying
candidates. The Nominating Committee takes into consideration such factors as it
deems appropriate when nominating candidates. These factors may include
judgment, skill, diversity, experience with investment companies and other
organizations of comparable purpose, complexity, size and subject to similar
legal restrictions and oversight, the interplay of the candidate's experience
with the experience of other Board members, and the extent to which the
candidate would be a desirable addition to the Board and any committees thereof.
The Nominating Committee will consider all qualified candidates in the same
manner. The Nominating Committee may modify its policies and procedures for
director nominees and recommendations in response to changes in the Fund's
circumstances, and as applicable legal or listing standards change.
The Nominating Committee would consider director candidates recommended by
stockholders (if a vacancy were to exist) and submitted in accordance with
applicable law and procedures as described in this Proxy Statement (see
"Submission of Stockholder Proposals" below). Such recommendations should be
forwarded to the Secretary of the Fund.
The Fund does not have a compensation committee.
OTHER BOARD-RELATED MATTERS
Stockholders who wish to send communications to the Board should send them
to the address of the Fund and to the attention of the Board. All such
communications will be directed to the Board's attention.
The Fund does not have a formal policy regarding Board member attendance at
the Annual Meeting of Stockholders; however, all of the Directors of the Fund,
who were Directors at the time, attended the April 24, 2006 Annual Meeting of
Stockholders.
Vote Required. The election of Messrs. Looney and Jacobson and Ms. Ciciora
as Directors of the Fund will require the affirmative vote of a plurality of the
votes cast by holders of the Common Stock at the Meeting in person or by proxy
on Proposal 1; and the election of Messrs. Barr and Horejsi as Directors of the
Fund will require the affirmative vote of a plurality of the votes cast by the
holders of the AMPS at the Meeting in person or by proxy on Proposal 1.
THE BOARD OF DIRECTORS, INCLUDING ALL OF THE INDEPENDENT DIRECTORS, UNANIMOUSLY
RECOMMENDS THAT THE STOCKHOLDERS VOTE "FOR" THE ELECTION OF ALL THE NOMINEES.
PROPOSAL 2
APPROVAL OR DISAPPROVAL OF AN AMENDMENT TO THE FUND'S FUNDAMENTAL
INVESTMENT RESTRICTION REGARDING INDUSTRY CONCENTRATION
The Board unanimously recommends that stockholders approve an amendment to
the Fund's fundamental investment restriction regarding industry concentration
(the "Industry Restriction"). Presently, the Industry Restriction states that
the Fund may not:
Invest in the securities of companies conducting their principal
business actively in the same industry if, immediately after such
investment, the value of its investments in such industry would exceed
25% of the value of its total assets; provided that this limitation
will not apply to real estate investment trusts (REITs) or related
companies in the same industry as REITs.
As amended, the Industry Restriction would state that the Fund may not:
Invest in the securities of companies conducting their principal
business actively in the same industry if, immediately after such
investment, the value of its investments in such industry would exceed
25% of the value of its total assets; provided that this limitation
will not apply to Real Estate Related Companies. "Real Estate Related
Companies" shall mean (i) companies in or primarily servicing the real
estate industry or (ii) companies deriving at least 50% of their
revenue from, or having at least 50% of their assets invested in, real
estate (as determined in good faith by the Advisers based on current
financial statements of the issuers) (collectively, "Real Estate
Related Companies"). Real Estate Related Companies would include, but
not be limited to: REITs and other closed-end registered investment
companies that invest primarily in REITs; home builders; real estate
developers; property management companies; real estate brokerage
companies; commercial and industrial construction companies; financial
companies who make or service real estate mortgages and/or
construction loans; title, homeowners and builders risk insurance
companies; manufacturers, distributors and retailers of construction
materials and/or building supplies; lumber, paper, forest products,
and other companies with significant real estate holdings; holding
companies of any of the foregoing companies; and any other companies
that the Advisers reasonably determine are Real Estate Related
Companies.
Proposal 2 would amend the Industry Restriction to clarify and significantly
broaden the types of investments that may be made by the Fund and included in
determining the Fund's compliance with the Industry Restriction. Although the
Fund would generally invest in Real Estate Related Companies based in the United
States, such companies may invest directly or indirectly in non-U.S. properties
or real estate related businesses and the Fund may make direct investments in
foreign Real Estate Related Companies. The Fund has no restrictions on its
ability to invest in foreign securities.
If Proposal 2 is approved, the Fund will be required, under normal market
conditions, to invest more than 25% of its assets in Real Estate Related
Companies. Proposal 2 is a change to a fundamental investment policy of the Fund
and thus its adoption requires the affirmative vote of a majority of the Fund's
stockholders. See Vote Required below.
Background of the Investment Restriction Regarding Industry Concentration.
In its March 25, 2003 proxy statement, the Fund asked stockholders to approve
the present Industry Restriction whereby the Fund would be permitted to invest
more than 25% of its assets in REITs or related companies in the same industry
classification as REITs. At the same time, the Fund indicated that if the
Industry Restriction was approved it would adopt a concentration policy whereby
the Fund, under normal market conditions, would be required to invest more than
25% of its assets in REITs and related companies in accordance with the Industry
Restriction. REITs are companies (typically trusts) dedicated to owning, and
usually operating, income producing real estate or to financing real estate
development or other types of similar real estate ventures.(1) At the annual
meeting held on April 22, 2003, stockholders approved the present Industry
Restriction and thereby adopted the present concentration policy. Under the
Investment Company Act of 1940, the Industry Restriction and present
concentration policy cannot be changed without stockholder approval. As of
December 29, 2006, 27.1% of the Fund's assets were invested in REITs.
Reason for this Proposal. The present Industry Restriction and
concentration policy have been beneficial to the Fund and stockholders and REITs
have performed well since their adoption. However, the Advisers want to give the
Fund sufficient flexibility to invest in a broader range of real estate related
companies so as to mitigate the volatility of being overly concentrated in the
Fund's current narrow asset class (i.e., REITs). In other words, the Advisers
would like to avoid being limited to investing solely in REITs in determining
the Fund's compliance with the Industry Restriction and diversify somewhat into
the equity or debt securities of other companies who are in the real estate
industry or derive a substantial portion of their revenue from, or have a
substantial portion of their assets invested in, real estate.
Risks Associated with Concentrating. If Proposal 2 is approved, the Fund
will be concentrated in Real Estate Related Companies and consequently less
diversified than stock funds investing in a broad range of industries.
Therefore, the Fund could experience significant volatility. For example,
changes in the tax laws, overbuilding, environmental issues, the quality of
property management in the case of REITs, and other factors could hurt the Fund.
Real estate is also affected by general economic conditions. When growth is
slowing, demand for property decreases and prices may decline. Rising interest
rates, which drive up mortgage and financing costs, can restrain construction
and buying and selling activity, and may reduce the appeal of real estate
investments. As with all equity funds, the Fund's net asset value can fall
because of weakness in the broad market, a particular industry, or specific
holdings. The market as a whole can decline for many reasons, including adverse
political or economic developments domestically or abroad, changes in investor
psychology or heavy institutional selling. The prospects for an industry or
company may deteriorate because of a variety of factors, including disappointing
earnings or changes in the competitive environment. In addition, the Advisers'
assessment of companies held by the Fund may prove incorrect, resulting in
losses or poor performance even in a rising market. Finally, the Fund's
investment approach could fall out of favor with the investing public, resulting
in lagging performance versus other types of stock funds. Foreign stock holdings
may lose value because of declining foreign currencies or adverse political or
economic events overseas. As with any investment company, there can be no
guarantee the Fund will achieve its objective.
Under normal market conditions, the Fund intends to invest at least 80% of
its net assets in common stocks, primarily domestic common stocks and
secondarily in foreign common stocks denominated in foreign currencies. The
Fund's investments in common stocks may include, but is not limited to, RICs
whose objective is income, REITs, and other dividend-paying common stocks. The
portion of the Fund's assets that are not invested in common stocks may be
invested in fixed income securities, cash equivalents and other income-producing
securities. The term "fixed income securities" includes but is not limited to
corporate bonds, U.S. government securities, notes, bills, debentures, preferred
stocks, convertible securities, bank debt obligations, repurchase agreements and
short-term money market obligations. Under normal conditions, the Fund may hold
up to 20% of its assets in cash or money market instruments. The Fund intends to
invest in money market instruments pending investments in common stocks, to
serve as collateral in connection with certain investment techniques, and to
hold as a reserve pending the payment of dividends to investors. When the
Advisers believe that economic circumstances warrant a temporary defensive
posture, the Fund may invest without limitation in short-term money market
instruments.
Considerations by the Board of Directors. The Board considered Proposal 2
at a meeting held on January 26, 2007. At this meeting the Advisers presented
the Board with an overview of the REIT industry, explaining that, as an asset
class, REITs had outperformed other sectors of the broad market over the past
several years, had been beneficial for the Fund and its stockholders, but were
priced at historically high levels. The Advisers indicated while the Fund should
maintain its real estate industry focus, they would like to be able to consider
the debt and equity securities of a broader range of real estate related
companies in determining the Fund's compliance with the Investment Restriction.
The Advisers also explained that they needed the flexibility to be able to
invest in a wider array of securities associated with the real estate industry.
The Advisers also explained that the lack of clarity in the kinds of real estate
related companies that might be included in determining the Fund's compliance
with the Industry Restriction necessarily limits the Fund's ability to diversify
its real estate related assets. Under the proposed Investment Restriction, the
Fund would still be able to invest in REITs and consider them in determining the
Fund's compliance with the Investment Restriction, but would have the added
flexibility to diversify into other sectors of the real estate industry and
still consider such investments in determining the Fund's compliance with the
Investment Restriction. Proposal 2 would permit a much broader and diverse range
of real estate related companies to be considered in determining the Fund's
compliance with the Investment Restriction. The Advisers believe this will inure
to the long-term benefit of the Fund and its stockholders.
The Board also recognized that, because of rapidly changing markets and the
evolution and consolidation of the real estate industry, it would be difficult
to define real estate related companies with any specificity. Accordingly,
although terminating or otherwise amending the Investment Restriction would
require stockholder approval, the amended Investment Restriction, if approved,
would permit the Advisers to reasonably determine whether a particular issuer or
class of issuers constitutes "Real Estate Related Companies" without having to
seek stockholder approval. In the end, the Board determined that adopting the
new Investment Restriction would provide the Advisers with more flexibility and
a broader and more diverse range of investment possibilities while at the same
time respecting the Fund's historical investment focus on the real estate
industry, was consistent with and will have a beneficial effect on the Fund's
primary investment objective of long-term capital appreciation, and is in the
best interest of the Fund and its stockholders.
Vote Required. Approval of Proposal No. 2 requires a 1940 Act Majority Vote
of Common Stock. For purposes of this Proxy Statement, a 1940 Act Majority Vote
of Common Stock means the affirmative vote of the lesser of (a) 67% or more of
the Shares of Common Stock present or represented by proxy at the Meeting or (b)
more than 50% of the outstanding Shares of Common Stock.
THE BOARD OF DIRECTORS, INCLUDING ALL OF THE INDEPENDENT DIRECTORS, UNANIMOUSLY
RECOMMENDS THAT THE STOCKHOLDERS VOTE "FOR" PROPOSAL 2.
SUBMISSION OF STOCKHOLDER PROPOSALS
Notice is hereby given that for a stockholder proposal to be considered for
inclusion in the Fund's proxy material relating to its 2008 annual meeting of
stockholders, the stockholder proposal must be received by the Fund no later
than December 10, 2007. Any such proposal shall set forth as to each matter the
stockholder proposes to bring before the meeting (i) a brief description of the
business desired to be brought before the meeting and the reasons for conducting
such business at the meeting, (ii) the name and address, as they appear on the
Fund's books, of the stockholder proposing such business, (iii) the class and
number of shares of the capital stock of the Fund which are beneficially owned
by the stockholder, and (iv) any material interest of the stockholder in such
business. Stockholder proposals, including any accompanying supporting
statement, may not exceed 500 words. A stockholder desiring to submit a proposal
must be a record or beneficial owner of Shares with a market value of $2,000 and
must have held such Shares for at least one year. Further, the stockholder must
continue to hold such Shares through the date on which the meeting is held.
Documentary support regarding the foregoing must be provided along with the
proposal. There are additional requirements regarding proposals of stockholders,
and a stockholder contemplating submission of a proposal is referred to Rule
14a-8 promulgated under the 1934 Act. The timely submission of a proposal does
not guarantee its inclusion in the Fund's proxy materials.
Pursuant to the Fund's By-laws, at any annual meeting of the stockholders,
only business that has been properly brought before the meeting will be
conducted. To be properly brought before the annual meeting, the business must
be (i) specified in the notice of meeting, (ii) by or at the direction of the
Board of Directors, or (iii) otherwise properly brought before the meeting by a
stockholder. For business to be properly brought before the annual meeting by a
stockholder, the stockholder must have given timely notice thereof in writing to
the Secretary of the Fund. To be timely, a stockholder's notice must be
delivered to the Secretary at 2344 Spruce Street, Suite A, Boulder, Colorado
80302 no later than 5:00 p.m., Mountain Time, on the 120th day prior to the
first anniversary of the date of mailing of the notice for the preceding year's
annual meeting. However, if the date of the annual meeting is advanced or
delayed by more than 30 days from the first anniversary of the date of the
preceding year's annual meeting, for notice by the stockholder to be timely, it
must be delivered not later than 5:00 p.m., Mountain Time, on the later of the
120th day prior to the date of such annual meeting or the tenth day following
the day on which public announcement of the date of such meeting is first made.
The public announcement of a postponement or adjournment of an annual meeting
shall not commence a new time period for the giving of a stockholder's notice as
described above.
Pursuant to the Fund's By-laws, such stockholder's notice shall set forth
(i) as to each individual whom the stockholder proposes to nominate for election
or reelection as a director, (A) the name, age, business address and residence
address of such individual, (B) the class, series and number of any shares of
stock of the Fund that are beneficially owned by such individual, (C) the date
such shares were acquired and the investment intent of such acquisition, (D)
whether such stockholder believes any such individual is, or is not, an
"interested person" of the Fund, as defined in the 1940 Act and information
regarding such individual that is sufficient, in the discretion of the Board of
Directors or any committee thereof or any authorized officer of the Fund, to
make such determination and (E) all other information relating to such
individual that is required to be disclosed in solicitations of proxies for
election of directors in an election contest (even if an election contest is not
involved), or is otherwise required, in each case pursuant to Regulation 14A (or
any successor provision) under the Exchange Act and the rules thereunder
(including such individual's written consent to being named in the proxy
statement as a nominee and to serving as a director if elected); (ii) as to any
other business that the stockholder proposes to bring before the meeting, a
description of such business, the reasons for proposing such business at the
meeting and any material interest in such business of such stockholder and any
Stockholder Associated Person (as defined below), individually or in the
aggregate, including any anticipated benefit to the stockholder and the
Stockholder Associated Person therefrom; (iii) as to the stockholder giving the
notice and any Stockholder Associated Person, the class, series and number of
all shares of stock of the Fund which are owned by such stockholder and by such
Stockholder Associated Person, if any, and the nominee holder for, and number
of, shares owned beneficially but not of record by such stockholder and by any
such Stockholder Associated Person; (iv) as to the stockholder giving the notice
and any Stockholder Associated Person covered by the immediately preceding
clauses (ii) or (iii), the name and address of such stockholder, as they appear
on the Fund's stock ledger and current name and address, if different, and of
such Stockholder Associated Person; and (v) to the extent known by the
stockholder giving the notice, the name and address of any other stockholder
supporting the nominee for election or reelection as a director or the proposal
of other business on the date of such stockholder's notice. "Stockholder
Associated Person" of any stockholder shall mean (i) any person controlling,
directly or indirectly, or acting in concert with, such stockholder, (ii) any
beneficial owner of shares of stock of the Fund owned of record or beneficially
by such stockholder and (iii) any person controlling, controlled by or under
common control with such Stockholder Associated Person.
ADDITIONAL INFORMATION
INDEPENDENT ACCOUNTANTS. The Audit Committee of the Board, consisting of
those Directors who are not "interested persons" (as defined in the 1940 Act),
will select the Fund's independent accountants for the Fund's fiscal year ending
November 30, 2007 at the Board's regular quarterly meeting in August 2007. At
its regularly scheduled Board meeting held on July 24, 2006, the Audit Committee
selected, and the Board ratified, the selection of Deloitte & Touche LLP
("Deloitte") of 555 17th Street, Denver, Colorado as the Fund's independent
registered public accounting firm to replace KPMG LLP ("KPMG"). KPMG served as
independent accountants for the Fund from 2002 through November 30, 2005. KPMG's
reports on the financial statements for the two years immediately preceding
their termination contained no adverse opinion or disclaimer of opinion and was
not qualified or modified as to uncertainty, audit scope, or accounting
principles. During the two fiscal years immediately preceding KPMG's
termination, there were no disagreements with such accountants on any matter of
accounting principles or practices, financial statement disclosure, or auditing
scope or procedure.
Deloitte served as independent accountants for the Fund's fiscal year
ending November 30, 2006. A representative of Deloitte will not be present at
the Meeting but will be available by telephone and will have an opportunity to
make a statement if the representative so desires and will be available to
respond to appropriate questions.
Set forth below are audit fees and non-audit related fees billed to the
Fund for professional services received from KPMG for the Fund's fiscal year
ended November 30, 2005 and from Deloitte for the Fund's fiscal year ended
November 30, 2006.
Fiscal Year Ended Audit Fees Audit-Related Fees Tax Fees* All Other Fees
----------------- ---------- ------------------ --------- --------------
11/30/2005 $25,250 $0 $6,000 $18,000+
11/30/2006 $25,500 $0 $6,250 $4,650
* "Tax Fees" are those fees billed to each Fund by KPMG or Deloitte in
connection with tax consulting services, including primarily the review of
each Fund's income tax returns.
+ This fee pertained to the comfort letter related to the Fund's issuance of
Auction Market Preferred Shares.
The Audit Committee Charter requires that the Audit Committee pre-approve
all audit and non-audit services to be provided by the auditors to the Fund, and
all non-audit services to be provided by the auditors to the Fund's investment
adviser and any service providers controlling, controlled by or under common
control with the Funds' investment adviser ("affiliates") that provide on-going
services to each Fund, if the engagement relates directly to the operations and
financial reporting of each Fund, or to establish detailed pre-approval policies
and procedures for such services in accordance with applicable laws. All of the
audit, audit-related and tax services described above for which KPMG billed the
Fund fees for the fiscal year ended November 30, 2005 and for which Deloitte
billed the Fund fees for the fiscal year ended November 30, 2006 were
pre-approved by the Audit Committee.
Deloitte has informed the Fund that it has no direct or indirect financial
interest in the Fund. For the Fund's fiscal year ended November 30, 2006,
Deloitte did not provide any non-audit services or bill any fees for such
services to the Funds' investment adviser or any affiliates thereof that provide
services to the Fund. The Horejsi Affiliates had engaged KPMG from time to time
in the past to provide various accounting, auditing and consulting services and
currently engages KPMG on an as-needed basis as a consultant with respect to
ongoing tax related issues. For the twelve months ended November 30, 2005, the
Horejsi Affiliates paid $0 to KPMG for their services. For the twelve months
ended November 30, 2006, the Horejsi Affiliates paid $0 to Deloitte for their
services. The Audit Committee has considered and concluded that the provision of
non-audit services is compatible with maintaining the auditors' independence.
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE. Section 16(a) of
the 1934 Act and Section 30(h) of the 1940 Act requires the Fund's Directors and
officers, persons affiliated with the Fund's investment advisers, and persons
who own more than 10% of a registered class of the Fund's securities, to file
reports of ownership and changes of ownership with the SEC and the New York
Stock Exchange. Directors, officers and greater-than-10% stockholders are
required by SEC regulations to furnish the Fund with copies of all Section 16(a)
forms they file. Based solely upon the Fund's review of the copies of such forms
it receives and written representations from such persons, the Fund believes
that through the date hereof all such filing requirements applicable to such
persons were complied with.
BROKER NON-VOTES AND ABSTENTIONS. An uninstructed proxy for shares held by
brokers or nominees as to which (i) instructions have not been received from the
beneficial owners or the persons entitled to vote and (ii) the broker or nominee
does not have discretionary voting power on a particular matter is a broker
"non-vote". Proxies that reflect abstentions or broker non-votes (collectively
"abstentions") will be counted as shares that are present and entitled to vote
on the matter for purposes of determining the presence of a quorum. In
circumstances where the vote to approve a matter is a percentage of votes cast
(e.g., Proposal y1), abstentions have no effect because they are not a vote
cast. Thus, they will be disregarded in determining the "votes cast" on the
particular issue.
OTHER MATTERS TO COME BEFORE THE MEETING
The Fund does not intend to present any other business at the Meeting, nor
is it aware that any stockholder intends to do so. If, however, any other
matters are properly brought before the Meeting, the persons named in the
accompanying form of proxy will vote thereon in accordance with their
discretion.
--------------------------------------------------------------------------------
IT IS IMPORTANT THAT PROXIES BE RETURNED PROMPTLY. STOCKHOLDERS WHO DO NOT
EXPECT TO ATTEND THE MEETING ARE THEREFORE URGED TO COMPLETE, SIGN, DATE AND
RETURN ALL PROXY CARDS AS SOON AS POSSIBLE IN THE ENCLOSED POSTAGE-PAID
ENVELOPE.
--------------------------------------------------------------------------------
FOOTNOTES:
(1) REITs can generally be classified as Equity REITs, Mortgage REITs, or
Hybrid REITs. An Equity REIT invests primarily in the fee ownership or
leasehold ownership of land and buildings and derives its income primarily
from rental income. An Equity REIT may also realize capital gains (or
losses) by selling real estate properties in its portfolio that have
appreciated (or depreciated) in value. A Mortgage REIT invests primarily in
mortgages on real estate, which may secure construction, development, or
long-term loans. A Mortgage REIT generally derives its income from the fees
and interest payments on the credit it has extended. A Hybrid REIT combines
the characteristics of both Equity REITs and Mortgage REITs.
EXHIBIT A
1. The Audit Committee shall be composed entirely of directors who are not
"interested persons" of the Fund within the meaning of the Investment Company
Act of 1940 ("independent directors") and who are free of any other relationship
that, in the opinion of the Board of Directors, would interfere with their
exercise of independent judgment as Committee members. The Audit Committee
Chairman shall be selected by the members of the Committee. The Audit Committee
shall have at least three members, all of whom shall be financially literate.
The Chairman of the Committee must have accounting or related financial
management expertise, as determined by the Board in its judgment.
At least annually, the Board of Directors shall determine whether one or more
"audit committee financial experts," as such term is defined by the Securities
and Exchange Commission, are members of the Committee and whether any such
expert is "independent." For purposes of this finding only, in order to be
considered "independent," any such expert may not, other than in his or her
capacity as a member of the Committee, the Board or any other Board committee,
accept directly or indirectly any consulting, advisory or other compensatory fee
from the Fund (other than Board or committee fees). The designation of a person
as an audit committee financial expert ("ACFE") shall not impose any liability
greater than the liability imposed on such person as a member of the Audit
Committee or the Board of Directors in the absence of such designation.
2. The purposes of the Audit Committee are:
(a) to assist Board oversight of
1. the integrity of the Fund's financial statements
2. the Fund's compliance with legal and regulatory requirements
3. the independent auditor's qualifications and independence
4. the performance of the Fund's independent auditors
(b) to prepare an audit committee report if required by the SEC to be
included in the Fund's annual proxy statement;
(c) to oversee the Fund's accounting and financial reporting policies and
practices, its internal controls and, as appropriate, the internal
controls of certain service providers;
(d) to oversee the quality and objectivity of the Fund's financial
statements and the independent audit thereof;
(e) to determine the selection, appointment, retention and termination of
the Fund's independent auditors, as well as approving the compensation
of the auditors;
(f) to pre-approve all audit and non-audit services provided to the Fund
and certain other persons (as described in 4(d) and (e) below) by such
independent auditors; and
(g) to act as a liaison between the Fund's independent auditors and the
full Board of Directors.
The Fund's independent auditors shall report directly to the Committee.
The function of the Committee is oversight. The Fund's management is
responsible for (i) the preparation, presentation and integrity of the Fund's
financial statements, (ii) the maintenance of appropriate accounting and
financial reporting principles and policies and (iii) the maintenance of
internal controls and procedures designed to assure compliance with accounting
standards and applicable laws and regulations. The auditors are responsible for
planning and carrying out proper audits and reviews in accordance with generally
accepted auditing standards. In fulfilling their responsibilities hereunder, it
is recognized that members of the Committee are not full time employees of the
Fund and are not, and do not represent themselves to be, accountants or auditors
by profession or experts in the fields of accounting or auditing,
notwithstanding the possibility that one or more members may be designated an
ACFE. As such, it is not the duty or responsibility of the Committee or its
members to conduct "field work" or other types of auditing or accounting reviews
or procedures. Each member of the Committee shall be entitled to rely on (i) the
integrity of those persons and organizations within and outside the Fund from
which it receives information, (ii) the accuracy of the financial and other
information, including, for example, the information contemplated by paragraph
4(b), provided to the Committee by such persons and organizations absent actual
knowledge to the contrary (which shall be promptly reported to the Fund's Board)
and (iii) statements made by the officers and employees of the Fund, the Fund's
adviser or other third parties as to any information technology, internal audit
and other non-audit services provided by the independent auditors to the Fund.
In addition, the evaluation of the Fund's financial statements by the Committee
is not of the same scope as, and does not involve the extent of detail as,
audits performed by the auditors, nor does the Committee's evaluation substitute
for the responsibilities of the Fund's management for preparing, or the auditors
for auditing, the financial statements. The designation of a person as an ACFE
is not intended to impose any greater responsibility or liability on that person
than the responsibility and liability imposed on such a person as a member of
the Committee, nor does it decrease the duties and obligations of the other
Committee members or the Board.
The Committee shall have the appropriate resources and authority to discharge
its responsibilities, including the authority to retain special counsel and
other experts or consultants at the expense of the Fund. The Committee shall
also have the authority to seek information, data and services from management
in order to carry out its responsibilities.
3. With respect to any subsequent changes to the composition of the
Committee, and otherwise approximately once each year, the Board of Directors
shall determine:
(a) that each member of the Audit Committee is "independent" pursuant to
the NYSE's governance standards or applicable law or;
(b) that each Audit Committee member is financially literate;
(c) that at least one of the Committee members has accounting or related
financial management expertise; and
(d) the adequacy of the Charter.
4. To carry out its purposes, the Audit Committee shall have the following
duties and powers:
(a) to select, retain, determine the compensation of, or terminate
auditors and to oversee the work of the Fund's independent auditors
(or any other public accounting firm engaged for the purpose of
performing other audit, review or attestation services for the Fund)
and, in connection therewith, to evaluate the independence of the
auditors, including whether the auditors provide any consulting
services to any service provider, to resolve any disagreements between
management and the Fund's independent auditors regarding financial
reporting, to receive the auditors' specific representations as to
their independence at least annually and to recommend the retention of
such auditors to the independent directors for their ratification and
approval;
(b) to meet with the Fund's independent auditors, including meetings apart
from management, as necessary (i) to review the arrangements for and
scope of the annual audit and any special audits; (ii) to discuss
critical accounting policies and practices to be used in the annual
audit and all alternative treatments of financial information within
generally accepted accounting principles that have been discussed with
management, the ramifications of the use of such alternative
treatments, and the treatments preferred by the auditor; (iii) to
discuss any matters of importance relating to the Fund's financial
statements, including any adjustments to such statements recommended
by the auditors, or other results of said audit(s); (iv) to consider
the auditors' comments with respect to the acceptability and
appropriateness of the Fund's financial reporting policies, procedures
and internal accounting controls, and management's responses thereto;
(v) to review the form of opinion the auditors propose to render to
the Board and shareholders; (vi) to review copies of any material
written communication between the auditor and management, such as any
management letter or schedule of unadjusted differences; (vii) to
review the adequacy and effectiveness of relevant internal controls
and procedures and the quality of the staff implementing those
controls and procedures and to obtain annually in writing from the
independent auditors their letter as to the adequacy of such controls
as required by Form N-SAR; (viii) to receive periodic reports
concerning regulatory changes and new accounting pronouncements that
significantly affect the value of the Fund's assets and its financial
reporting; (ix) to discuss any audit problems or difficulties and
management's response, including any restrictions on the scope of the
auditor's activities or on access to requested information, and any
significant disagreements with management; and (x) to receive
disclosure from the auditor regarding all services provided by the
auditor to the Fund, including the fees associated with those
services, at least annually, and if the annual communication is not
made within 90 days before the filing of the Fund's annual report, to
receive an update, in the 90 day period before the filing, of any
changes to the previously reported information.
(c) to consider the effect upon the Fund of any changes in accounting
principles or practices proposed by management or the auditors, and to
consider, in consultation with management and the Fund's independent
auditors, any significant changes to the Fund's tax accounting
policies, including those pertaining to its qualification as a
regulated investment company under the Internal Revenue Code;
(d) to review and pre-approve all auditing services and permissible
non-audit services (e.g., tax services) to be provided to the Fund by
the auditor, including the fees therefore. The Committee may delegate
to one or more of its members the authority to grant pre-approvals. In
connection with such delegation, the Committee shall establish
pre-approval policies and procedures, including the requirement that
the decisions of any member to whom authority is delegated under this
sub-section (d) shall be presented to the full Committee at each of
its scheduled meetings.
Pre-approval for a permitted non-audit service shall not be required
if: (1) the aggregate amount of all such non-audit services is not
more than 5% of the total revenues paid by the Fund to the auditor in
the fiscal year in which the non-audit services are provided; (2) such
services were not recognized by the Fund at the time of the engagement
to be non-audit services; and (3) such services are promptly brought
to the attention of the Committee and approved prior to the completion
of the audit by the Committee or by one or more members of the
Committee to whom authority to grant such approvals has been delegated
by the Committee.
Additionally, the Committee shall pre-approve the auditor's
engagements for non-audit services with the Fund's investment advisers
(each, an "Adviser") and any service providers controlling, controlled
by or under common control with an Adviser ("affiliate") that provides
ongoing services to the Fund in accordance with the foregoing
paragraph, if the engagement relates directly to the operations and
financial reporting of the Fund, unless the aggregate amount of all
services provided constitutes no more than 5% of the total amount of
revenues paid to the auditor by the Fund, an Adviser and any affiliate
of the Adviser that provides ongoing services to the Fund during the
fiscal year in which the services are provided that would have to be
pre-approved by the Committee pursuant to this paragraph (without
regard to this exception).
Prohibited Services - The auditor may not perform contemporaneously
any of the following non-audit services for the Fund: bookkeeping or
other services related to the accounting records or financial
statements of the Fund; financial information systems design and
implementation; appraisal or valuation services, fairness opinions, or
contribution-in-kind reports; actuarial services; internal audit
outsourcing services; management functions or human resources; broker
or dealer, investment adviser, or investment banking services; legal
services and expert services unrelated to the audit; and any other
service that the Public Company Accounting Oversight Board determines,
by regulation, is impermissible.
(e) to consider whether the provision by the Fund's auditor of non-audit
services to its investment adviser or adviser affiliate that provides
ongoing services to the Fund, which services were not pre-approved by
the Audit Committee, is compatible with maintaining the auditor's
independence;
(f) to investigate any improprieties or suspected improprieties in fund
operations and to establish procedures for the receipt, retention, and
treatment of complaints received by the Fund with respect to
accounting, internal accounting controls, or auditing matters and the
confidential anonymous submission by employees of the Fund and its
service providers of concerns regarding questionable accounting or
auditing matters;
(g) to review the findings made in any regulatory examinations of the Fund
and consult with management on appropriate responses;
(h) to review any material violations of the Code of Ethics for the Fund
and its Advisers and report the Committee's findings to the full Board
with recommendations for appropriate action;
(i) to review with the Fund's principal executive officer and/or principal
financial officer in connection with their certification of Form N-CSR
any significant deficiencies in the design or operation of internal
controls which could adversely affect the Fund's ability to record,
process, summarize and report financial data or material weaknesses
therein and any reported evidence of fraud involving management of
other employees who have a significant role in the Fund's internal
controls;
(j) to discuss with management policies and guidelines with respect to
risk assessment and risk management and the system of internal
control, and the steps taken to monitor and control such risks;
(k) to meet periodically with Fund management, apart from the Fund's
independent auditors;
(l) to discuss the types of information to be disclosed in press releases
concerning dividends, as well as financial information provided to
analysts and rating agencies, and the type of presentation to be made;
(m) to establish hiring policies for employees or former employees of the
auditor consistent with government regulations;
(n) at least annually, to obtain and review a report by the Fund's
independent auditors describing: (1) the audit firm's internal quality
control procedures; (2) any material issues raised by the most recent
internal quality control review, or peer review, of the firm, or by
any inquiry or investigation by governmental or professional
authorities, within the preceding five years, respecting one or more
independent audits carried out by the audit firm, and any steps taken
to deal with any such issues; and (3) for the purpose of assessing the
auditor's independence, all relationships between the independent
auditors and the Fund;
(o) to review and evaluate the qualifications, performance and
independence of the lead partner of the auditors;
(p) to assure the regular rotation of the lead audit partner and the
reviewing partner, and to consider whether there should be regular
rotation of the audit firm itself;
(q) to review and discuss the Fund's audited and unaudited financials
statements with management and, in the case of the audited financial
statements, the independent auditor, including the Fund's disclosure
of management's discussion of Fund performance, and to recommend to
the Board, as appropriate, the inclusion of the Fund's audited
financial statements in the Fund's annual report;
(r) to cause the preparation of any report or other disclosures required
by the New York Stock Exchange or the Securities and Exchange
Commission;
(s) to oversee the Fund's compliance with 1940 Act asset coverage tests
and coverage tests under applicable rating agency guidelines and the
Fund's Articles Supplementary, as amended or supplemented from time to
time; and
(t) to report regularly to the full Board any issues that arise with
respect to: (1) the quality or integrity of the Fund's financial
statements, (2) the Fund's compliance with legal or regulatory
requirements and (3) the performance and independence of the Fund's
independent auditors, and to make such recommendations with respect to
the above and other matters as the Committee may deem necessary or
appropriate.
5. The Fund's independent auditors are ultimately accountable to the Audit
Committee, as representatives of the Board of Directors and the shareholders of
the Fund, and the Audit Committee has the ultimate authority and responsibility
to select, evaluate and, where appropriate, replace the independent auditors (as
well as to nominate the independent auditors to be proposed for shareholder
approval, if necessary), subject to ratification and approval of the independent
directors of the Fund. The Committee will ensure that the Fund's independent
auditors submit to the Audit Committee, on a periodic basis, a formal written
statement delineating all relationships between the independent auditors and the
Fund and its service providers. The Committee will actively engage in a dialogue
with the Fund's independent auditors with respect to any disclosed relationships
or services that may impact the objectivity and independence of the independent
auditors, and will consider recommending that appropriate action be taken by the
Board of Directors to ensure the independence of the independent auditors.
6. The Committee shall meet at least twice annually, which shall include
separate executive sessions as the Committee may deem appropriate, and is
empowered to hold special meetings as circumstances require. The Committee shall
submit the minutes of all of its meetings to, or discuss the matters discussed
at each meeting with, the Board of Directors.
7. The Committee shall regularly meet with the Treasurer of the Fund and
with internal auditors, if any, for the Fund's Advisers and/or administrator to
review and discuss matters relevant to the Committee's duties and
responsibilities.
8. The Committee shall be responsible for reviewing any required
description of the Committee in the Fund's annual reports or proxy statements.
9. The Committee will periodically assess the independence of its members
and will evaluate its performance under the Charter annually.
10. The Committee will also serve as the Qualified Legal Compliance
Committee. The following procedures are designed to implement the Standards of
Professional Conduct for Attorneys pursuant to the Sarbanes-Oxley Act of 2002.
Provision of Information to Outside Counsel and Service Providers. To assist
attorneys employed by law firms retained by the Funds or service providers
engaged by the Funds, the chief executive officer of each Fund (the "CEO") must
send a notice to each such law firm and service provider providing contact
information with respect to each Fund's Legal Compliance Committee Chairperson.
The CEO must send a similar notice to each law firm and service provider when
the information provided in the most recent notice sent to such law firm or
service provider has changed.
Investigations and Responses. Upon receiving a report of evidence of a material
violation from an attorney employed by a law firm or service provider, the CEO
shall (i) record receipt of the report and (ii) report the matter promptly to
the Legal Compliance Committee (the "Committee"). Upon receiving a report of
evidence of a material violation from an attorney employed by a law firm or
service provider or from the CEO, the Committee shall (i) record the Committee's
receipt of the report, (ii) inform the Fund's CEO of the report (other than
those received from the and (iii) determine whether an investigation of a
material violation is necessary or appropriate. In determining whether an
investigation is necessary or appropriate, the Committee shall consider such
factors as it considers appropriate under the circumstances, which may include
the seniority of the alleged wrongdoer, the seriousness of the alleged violation
and the credibility of the allegation. If the Committee determines that an
investigation is necessary, the Committee must (A) notify the Fund's Audit
Committee or the Board of Directors, (B) initiate an investigation and (C)
retain additional expert personnel as it deems necessary. The Committee shall
have the discretion to engage auditors, counsel or other experts to assist in
the investigation of any report and in the analysis of results.
(a) Investigations. If the Committee deems it necessary, the Committee may
direct outside counsel to conduct a preliminary internal investigation
to determine whether the reported material violation has occurred, is
ongoing or is about to occur. The Committee may direct employees of
the Funds' investment advisers or administrators or any officer(s) of
the Funds to assist outside counsel. If Fund counsel is the reporting
counsel, Fund counsel nonetheless may be engaged to conduct the
preliminary internal investigation. If Fund counsel is the reporting
counsel, Fund counsel may decline to lead the preliminary internal
investigation and may recommend that the Fund seek alternative counsel
for purposes of conducting such investigation. Any investigation may
be conducted by the relevant Fund's CEO or chief legal officer (or the
equivalent thereof) if such officer is not the reporting attorney and
is not the subject of the alleged violation described in the report.
(b) Responses. At the conclusion of any investigation, the Committee, by
majority vote, shall recommend that the relevant Fund implement an
appropriate response to evidence of a material violation. What
constitutes an appropriate response will depend on whether the
Committee determines, on the basis of the facts and circumstances,
that a material violation has occurred, is ongoing or is about to
occur.
Unless the Committee reasonably believes that no material violation
has occurred, is ongoing or is about to occur, the Committee shall
take all reasonable steps to cause the Funds to adopt an appropriate
response. If the preliminary internal investigation is performed by
outside counsel, such counsel may recommend a proposed response for
adoption by the Committee.
Determination: No Violation. The Committee may determine that no material
violation has occurred, is ongoing or is about to occur. That determination must
be made on the basis that the Committee "reasonably believes" that no material
violation has occurred, is ongoing or is about to occur. "Reasonably believes"
means that the Committee "believes the matter in question and that the
circumstances are such that the belief is not unreasonable."
Determination: Material Violation Has Occurred, Is Ongoing or Is About to Occur.
If the Committee reasonably believes that a material violation has occurred, is
ongoing or is about to occur, the following responses should be considered:
(1) A Material Violation Has Occurred If the Committee reasonably
believes that the reported material violation has already
occurred, the Committee should seek to remedy or otherwise
address the material violation. The Committee should explore what
steps would be necessary or appropriate to reduce the likelihood
of a recurrence of the material violation. The Committee should
consider recommending that sanctions be imposed in connection
with the violation. Disclosure to the public or to the SEC should
be considered, depending on the nature of the violation and other
relevant factors.
(2) A Material Violation Is Ongoing If the Committee reasonably
believes that the reported material violation is ongoing, the
Committee should seek to take or recommend steps, measures and/or
sanctions that are designed to (i) stop any material violations
that are ongoing, (ii) remedy or otherwise appropriately address
the portion of the material violation that has already occurred,
and (iii) reduce the likelihood of a recurrence of the material
violation. Disclosure to the public or to the SEC should be
considered, depending on the nature of the violation and other
relevant factors.
(3) A Material Violation Has Yet to Occur If the Committee
reasonably believes that the reported material violation has not
yet occurred, the Committee should seek to take or recommend
steps and/or measures to prevent the reported material violation
from occurring. Depending on the circumstances of the impending
violation, actions to address potential future violations,
including sanctions, should be considered. In unusual
circumstances, disclosure to the SEC may also be appropriate. The
Committee may retain outside counsel, which may be Fund counsel,
to undertake a review of the reported evidence of a material
violation in order to assist the Committee in determining what
remedial measures would be appropriate under the circumstances.
Other Action. The Committee shall have the authority and
responsibility, acting by majority vote, to take all other
appropriate action, including the authority to notify the SEC, in
the event a Fund fails in any material respect to implement a
recommendation that the Committee has made within a reasonable
period of time.
(c). Reporting and Recordkeeping. The Committee shall inform the relevant
Fund's CEO and chief legal officer (or the equivalent thereof) and the
Board of Directors of the results of any investigation of a report of
a material violation and any appropriate remedial measures to be
adopted. The Committee or its delegate shall prepare, or cause to be
prepared, a memorandum reflecting (i) the information developed in any
internal investigation, (ii) any remedial recommendation made by the
Committee or by outside counsel retained to review any report of a
material violation and (iii) any remedial actions taken. The Committee
should review these records periodically to determine whether there
are any patterns of activity or violations that have emerged.
(d). Protection of Reporting Attorneys. The Committee shall not retaliate,
and shall not tolerate any retaliation by Fund management or any other
person or group, directly or indirectly, against anyone who, in good
faith, reports evidence of a material violation or provides assistance
to the Committee or any other person or group, including regulatory
authorities, investigating a report. The Committee shall seek to
maintain the confidentiality of any person who submits a report and
who asks that his or her identity remain confidential and shall not
make any effort, or tolerate any effort made by any other person or
group, to ascertain the identity of any person who makes a report
anonymously.
Oversight Responsibilities. The Committee will undertake an annual review of
these Procedures and the reporting and investigation systems to determine
whether they are functioning properly. The Boards of Directors of the Funds have
reviewed and adopted these Procedures. The Boards of Directors will review these
Procedures periodically to assure that they appropriately address then-existing
requirements for attorney up-the-ladder reporting.
11. The Committee shall review this Charter at least annually and recommend
any changes to the full Board of Directors.
12. This Charter may be altered, amended or repealed, or a new Charter may
be adopted, by the Board by the affirmative vote of a majority of all the
members of the Board, including a majority of the "non-interested" Board members
(within the meaning of the Investment Company Act of 1940, as amended).
13. The Chief Executive Officer ("CEO") of the Fund shall certify to the
Audit Committee of the Fund annually that he is not aware of any violation by
the Fund of any corporate governance standards or policies to which the Fund is
subject. In addition, the CEO of the Fund must promptly notify the Audit
Committee in writing after any executive officer of the Fund becomes aware of
any material non-compliance with any applicable corporate governance listing
standard or policy.
14. (a) The Fund shall provide the NYSE, with respect to any subsequent
changes to the composition of the Audit Committee or otherwise approximately
once each year, written confirmation of the determinations required by Section 3
above.
(b) The CEO of the Fund shall certify to the NYSE annually that he is not
aware of any violation by the Fund of the NYSE corporate governance
listing standards and such certification shall be included in the
Fund's annual report to shareholders. If the CEO of the Fund provides
notice to the NYSE upon receipt of any report by any executive officer
of any material non-compliance with any applicable provisions of the
NYSE corporate governance listing standards, copies of any such
certification or notice shall be provided to the Audit Committee of
the Fund.
PROXY
BOULDER GROWTH & INCOME FUND, INC.
PROXY SOLICITED BY THE BOARD OF DIRECTORS
The undersigned holder of shares of Common Stock of Boulder Growth & Income
Fund, Inc., a Maryland corporation (the "Fund"), hereby appoints Stephen C.
Miller, Carl D. Johns, and Thomas V. Finnerty, or any of them, as proxies for
the undersigned, with full powers of substitution in each of them, to attend the
Annual Meeting of Stockholders (the "Annual Meeting") to be held at the
Scottsdale Plaza Resort, 7200 N. Scottsdale Road, Scottsdale, Arizona at 9:00
a.m. Mountain Standard Time (local time), on April 27, 2007, and any
adjournments or postponements thereof, to cast on behalf of the undersigned all
votes that the undersigned is entitled to cast at the Annual Meeting and to
otherwise represent the undersigned at the Annual Meeting with all the powers
possessed by the undersigned if personally present at the Meeting. The votes
entitled to be cast will be cast as instructed below. If this Proxy is executed
but no instruction is given, the votes entitled to be cast by the undersigned
will be cast "FOR" each of the nominees for Director and "FOR" each of the other
proposals described in the Proxy Statement. The undersigned hereby acknowledges
receipt of the Notice of Annual Meeting and Proxy Statement. In their
discretion, the proxies are authorized to vote upon such other business as may
properly come before the Meeting. A majority of the proxies present and acting
at the Annual Meeting in person or by substitute (or, if only one shall be so
present, then that one) shall have and may exercise all of the power and
authority of said proxies hereunder. The undersigned hereby revokes any proxy
previously given.
CONTINUED AND TO BE SIGNED ON REVERSE SIDE
Please indicate your vote by an "X" in the appropriate box below.
This proxy, if properly executed, will be voted in the manner directed by the
undersigned stockholder. IF NO DIRECTION IS MADE, THIS PROXY WILL BE VOTED FOR
PROPOSALS 1AND 2.
Please refer to the Proxy Statement for a discussion of the Proposals.
------------ ------------------------------------------------------------- -----
Election of Directors: Nominees are Joel W. Looney, Susan
1. L. Ciciora., and Dr. Dean L. Jacobson.
FOR____ WITHHOLD___ FOR ALL EXCEPT ___
------------ ------------------------------------------------------------- -----
Instruction: If you do not wish your shares voted "for" a particular nominee,
mark the "For All Except" box and strike a line through the name(s) of the
nominee(s). Your shares will be voted "For" the remaining nominee(s).
THE BOARD OF DIRECTORS RECOMMENDS THAT THE STOCKHOLDERS VOTE "FOR" ELECTION OF
ALL THE NOMINEES
-------------- ----------------------------------------------------------- -----
2. An amendment to the Fund's fundamental investment
restriction regarding industry concentration.
FOR___ AGAINST ___ ABSTAIN ___
-------------- ----------------------------------------------------------- -----
THE BOARD OF DIRECTORS, INCLUDING ALL OF THE INDEPENDENT DIRECTORS, UNANIMOUSLY
RECOMMENDS THAT THE STOCKHOLDERS VOTE "FOR" THIS PROPOSAL, AS MORE FULLY
DESCRIBED IN THE PROXY STATEMENT
--------------------------------------------------------------------------------
MARK HERE FOR ADDRESS CHANGE AND NOTE AT LEFT ____
PLEASE SIGN, DATE AND RETURN PROMPTLY IN THE ENCLOSED ENVELOPE.
NOTE: Please sign exactly as your name appears on this Proxy. If joint owners,
EACH should sign this Proxy. When signing as attorney, executor, administrator,
trustee, guardian or corporate officer, please give your full title.
Signature:
-------------------------
Date:
-------------------------
Signature:
-------------------------
Date:
-------------------------
[AMPS PROXY CARD]
PROXY
BOULDER GROWTH & INCOME FUND, INC.
PROXY SOLICITED BY THE BOARD OF DIRECTORS
The undersigned holder of shares of the Auction Market Preferred Stock ("AMPS")
of Boulder Growth & Income Fund, Inc., a Maryland corporation (the "Fund"),
hereby appoints Stephen C. Miller, Carl D. Johns, and Thomas V. Finnerty, or any
of them as proxies for the undersigned, with full powers of substitution in each
of them, to attend the Annual Meeting of Stockholders (the "Annual Meeting") to
be held at the Scottsdale Plaza Resort, 7200 N. Scottsdale Road, Scottsdale,
Arizona at 9:00 a.m. Mountain Standard Time (local time), on April 27, 2007, and
any adjournments or postponements thereof, to cast on behalf of the undersigned
all votes that the undersigned is entitled to cast at the Annual Meeting and to
otherwise represent the undersigned at the Annual Meeting with all the powers
possessed by the undersigned if personally present at the Meeting. The votes
entitled to be cast will be cast as instructed below. If this Proxy is executed
but no instruction is given, the votes entitled to be cast by the undersigned
will be cast "FOR" each of the nominees for Director and "FOR" each of the other
proposals described in the Proxy Statement. The undersigned hereby acknowledges
receipt of the Notice of Annual Meeting and Proxy Statement. In their
discretion, the proxies are authorized to vote upon such other business as may
properly come before the Meeting. A majority of the proxies present and acting
at the Annual Meeting in person or by substitute (or, if only one shall be so
present, then that one) shall have and may exercise all of the power and
authority of said proxies hereunder. The undersigned hereby revokes any proxy
previously given.
CONTINUED AND TO BE SIGNED ON REVERSE SIDE
Please indicate your vote by an "X" in the appropriate box below.
This proxy, if properly executed, will be voted in the manner directed by the
undersigned stockholder. IF NO DIRECTION IS MADE, THIS PROXY WILL BE VOTED FOR
PROPOSALS 1AND 2.
Please refer to the Proxy Statement for a discussion of the Proposals.
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1. Election of Directors: Nominees are John S. Horejsi and
Richard I. Barr.
FOR____ WITHHOLD___ FOR ALL EXCEPT ___
------------ ------------------------------------------------------------- -----
Instruction: If you do not wish your shares voted "for" a particular nominee,
mark the "For All Except" box and strike a line through the name(s) of the
nominee(s). Your shares will be voted "For" the remaining nominee(s).
THE BOARD OF DIRECTORS RECOMMENDS THAT THE STOCKHOLDERS VOTE "FOR" ELECTION OF
ALL THE NOMINEES
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2. An amendment to the Fund's fundamental investment
restriction regarding industry concentration.
FOR___ AGAINST ___ ABSTAIN ___
-------------- ----------------------------------------------------------- -----
THE BOARD OF DIRECTORS, INCLUDING ALL OF THE INDEPENDENT DIRECTORS, UNANIMOUSLY
RECOMMENDS THAT THE STOCKHOLDERS VOTE "FOR" THIS PROPOSAL, AS MORE FULLY
DESCRIBED IN THE PROXY STATEMENT
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MARK HERE FOR ADDRESS CHANGE AND NOTE AT LEFT ____
PLEASE SIGN, DATE AND RETURN PROMPTLY IN THE ENCLOSED ENVELOPE.
NOTE: Please sign exactly as your name appears on this Proxy. If joint owners,
EACH should sign this Proxy. When signing as attorney, executor, administrator,
trustee, guardian or corporate officer, please give your full title.
Signature:
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Date:
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Signature:
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Date:
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