[GRAPHIC OMITTED] BOULDER GROWTH & INCOME FUND, INC.
1680 38TH STREET, SUITE 800
BOULDER, COLORADO 80301
March ____, 2005
Dear Fellow Stockholder,
You are cordially invited to attend the 2005 Annual Meeting of Stockholders
of Boulder Growth & Income Fund, Inc., which will be held on April 26, 2005 at
9:00 a.m. Mountain Standard Time (local time), at the Millennium Resort
McCormick Ranch, 7401 N. 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 four non-routine proposals contained in this Proxy: The first two
are corporate governance matters which establish the number of directors at five
and change the voting standard for stockholder approved bylaws to a majority of
votes entitled to be cast. The third and forth proposals eliminate the Fund's
fundamental restriction on investing in options and foreign securities.
As Chairman of the Board, I encourage you to support each of the proposals.
After careful review by 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. Accordingly, we ask that you please sign, date and return the
enclosed Proxy Card or vote via telephone or the Internet at your earliest
convenience.
On behalf of the Board of Directors and the management of Boulder Growth &
Income Fund, 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.
1680 38TH STREET, SUITE 800
BOULDER, COLORADO 80301
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
To Be Held on April 26, 2005
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 Millennium Resort McCormick Ranch, 7401 N. Scottsdale Road,, Scottsdale,
Arizona at 9:00 a.m. Mountain Standard Time (local time), on April 26, 2005, for
the following purposes:
1. The election of Directors of the Fund (Proposal 1).
2. An amendment to the Charter to establish the number of Directors at
five (5) (Proposal 2).
3. An amendment to the Charter changing the voting standard for
stockholders to amend or adopt Bylaws to the affirmative vote of a
majority of all the votes entitled to be cast on the matter (Proposal
3).
4. To approve or disapprove the elimination of the Fund's fundamental
investment restriction on writing, purchasing or selling puts and
calls (Proposal 4).
5. To approve or disapprove the elimination of the Fund's fundamental
investment restriction regarding investment in foreign securities
(Proposal 5).
6. 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, 2005 as the record date for the determination of stockholders of
the Fund entitled to notice of and to vote at the Annual Meeting.
By Order of the Board of Directors,
/s/ Stephanie Kelley
STEPHANIE KELLEY
Secretary
March ___, 2005
--------------------------------------------------------------------------------
STOCKHOLDERS WHO DO NOT EXPECT TO ATTEND THE ANNUAL MEETING ARE REQUESTED TO
COMPLETE, SIGN AND DATE THE ENCLOSED PROXY CARD. 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.
STOCKHOLDERS WHO HAVE QUESTIONS OR NEED ASSISTANCE IN VOTING MAY CONTACT
MACKENZIE PARTNERS, INC. TOLL FREE AT 1-800-322-2885 OR BY EMAIL AT
PROXY@MACKENZIEPARTNERS.COM
--------------------------------------------------------------------------------
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.
1680 38TH STREET, SUITE 800
BOULDER, COLORADO 80301
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, two corporate governance proposals (i.e., Proposals 2 and 3), which
involve amending the Fund's charter (the "Corporate Governance Proposals"), and
two proposals which eliminate two of the Fund's fundamental investment
restrictions.
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 2006 and until their successors are
duly elected and qualify: Richard I. Barr, Joel W. Looney, Alfred G. Aldridge,
Jr., John S. Horejsi, and Dennis R. Causier.
Question 3: Why is the Board recommending the Corporate Governance Proposals?
Answer: The Board is recommending the Corporate Governance Proposals to enhance
and clarify certain proposals that were approved by stockholders at the 2004
Annual Meeting. Last May, after stockholders approved a comprehensive range of
corporate governance proposals, the Board determined that several additional
changes should be made in order to give the effect intended by the Board, that
is, to balance the efficiency of operating the Fund with stockholders having an
effective voice. The first of these is a charter amendment that established the
"maximum" number of directors at five (5). The Board believes stockholders will
be better served if the number of directors is instead "fixed" at five, no more,
no less, in order to avoid altogether the common abuse of manipulating board
size to affect the voting impact of directors. The second is a charter amendment
that would permit stockholders to amend bylaws with a "majority of votes cast."
The Board has determined that this standard was perhaps too relaxed and might
encourage unwanted activism and nuisance proposals to change bylaws that would
be costly and result in a diversion to the important business of the Funds.
Question 4: Why is the Board recommending changing the Fund's fundamental
investment policy regarding investments in foreign securities?
Answer: The Fund currently is limited to investing no more than 20% of its
assets in foreign securities. The Board believes that this provision may
unnecessarily restrict its participating in and profiting from attractive
foreign securities. With the introduction of the Euro and the recent decline in
the relative strength of the U.S. Dollar, the Fund needs the flexibility to
invest a larger percentage of its assets in the securities of foreign issuers.
The Advisers believe that foreign stocks, especially those that trade on foreign
exchanges in foreign currencies, may present the Fund better opportunities than
those currently found in the U.S.
Question 5: Why is the Board recommending changing the Fund's fundamental
investment policy regarding puts and calls?
Answer: The Advisers believe that this provision unnecessarily restricts the
Fund from participating in and profiting from buying, selling or writing options
on securities. This restriction was originally placed on the Fund at its
inception, under its former name, USLife Income Fund, and its former advisor. At
the time it was likely put in place to assure prospective stockholders that the
advisor would not participate in the options market, due to leverage
considerations and the general viewpoint from the public's eye that the options
market is speculative. The Fund currently is prohibited from investing in puts
and calls (i.e., options). The Advisers believe that this restriction
unnecessarily restricts the Fund from the opportunity to profit from buying,
selling and writing options. Options give the right to buy or sell a security at
a set price on or before a date certain. The Advisers would be most likely to
use options in arbitrage situations. The Advisers may also use options to hedge
certain perceived risks.
Question 6: How do the Horejsi Affiliates (as defined below at Page 2) intend to
vote on the Corporate Governance Proposals?
Answer: The Horejsi Affiliates intend to vote in favor of each of the Proposals,
including each Corporate Governance Proposal.
Question 7: How does the Board recommend that stockholders vote on the various
proposals?
Answer: If no instructions are indicated on your proxy, the representatives
holding proxies will vote in accordance with the recommendations of the Board.
The Board, including all of the Independent Directors, has unanimously
recommended that stockholders vote FOR all of the Proposals.
Question 8: Who is entitled to vote?
Answer: Stockholders of record at the close of business on February 28, 2005
(the "Record Date") are entitled to notice of and to vote at the Meeting. Each
of the shares outstanding on the Record Date is entitled to one vote on each of
the Proposals.
Question 9: What is the required quorum for the Meeting?
Answer: The holders of at least a majority of the outstanding common shares 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 proxy instructions (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 10: 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
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 will cast your votes FOR all of the Proposals.
Question 11: 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 vote), 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 so request, but attendance at the Meeting will not by itself revoke a
previously granted proxy.
[GRAPHIC OMITTED] BOULDER GROWTH & INCOME FUND, INC.
1680 38TH STREET, SUITE 800
BOULDER, COLORADO 80301
ANNUAL MEETING OF STOCKHOLDERS
April 26, 2005
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 Tuesday, April 26, 2005, at 9:00 a.m.
Mountain Standard Time (local time), at the Millennium Resort McCormick Ranch,
7401 N. Scottsdale Drive, Scottsdale, Arizona, and at any adjournments and
postponements thereof (the "Meeting"). A Notice of Annual Meeting of
Stockholders and proxy card for the Fund accompany this Proxy Statement. Proxy
solicitations will be made, beginning on or about March ___, 2005, primarily by
mail, but proxy solicitations may also be made by telephone, by Internet on the
Fund's web site, telegraph or personal interviews conducted by officers of the
Fund and PFPC Inc., the transfer agent of the Fund, and by MacKenzie Partners,
Inc. ("MacKenzie"), the Fund's proxy solicitor. MacKenzie's fee to assist in the
solicitation of proxies is estimated to be $______ plus expenses. The costs of
proxy solicitation and expenses incurred in connection with the preparation of
this Proxy Statement and its enclosures 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, 2005 as the record date (the "Record
Date") for the determination of stockholders entitled to notice of and to vote
at the Meeting.
The Annual Report of the Fund, including audited financial statements for
the fiscal period ended November 30, 2004, 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"), 1680 38th Street, Suite 800,
Boulder, Colorado 80301 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 1680 38th Street, Suite 800, Boulder, Colorado 80301. 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 26, 2005
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 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 one class of capital stock: common stock, par value $0.01 per
share (the "Common Stock" or the "Shares"). On the Record Date, there were
11,327,784 Shares issued and outstanding. Each Share is entitled to one vote at
the Meeting and fractional shares are entitled to proportionate shares of one
vote.
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 2,354,600 2,354,600 20.79%
Badlands Trust Company --- ---** 20.79%
Stewart R. Horejsi Trust No. 2 --- ---** 20.79%
Aggregate Shares Owned** 2,354,600 2,354,600 20.79%
* The address of each listed owner is c/o Badlands Trust Company, LLC, 3601 C.
Street, Suite 600, 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, Robert Ciciora, who is the brother
of Mr. Horejsi's son-in-law (John Ciciora), Laura Rhodenbaugh and Kevin Van
Nortwick. 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.
----------------------------
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, [10,235,192 shares or
90.35%] of Common Stock outstanding of the Fund.
As of the Record Date, the executive officers and directors of the Fund, as
a group, owned 2,389,729 shares of Common Stock (this amount includes the
aggregate shares of Common Stock owned by the Horejsi Affiliates set forth
above), representing 21.10% of Common Stock.
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, Alfred G. Aldridge, Jr., John S.
Horejsi and Dennis R. Causier. At a regularly scheduled meeting of the Board of
Directors held on October 15, 2004, the Board accepted the resignation of
Stephen C. Miller as a Director of the Fund. The remaining directors elected
Dennis R. Causier as Mr. Miller's replacement. Mr. Miller, previously an
interested director of the Fund, resigned in order to bring the Fund into
compliance with recent SEC regulations that become effective in January 2006 and
which require that 75% of the Board be non-interested directors. 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.
INFORMATION ABOUT DIRECTORS AND OFFICERS. Set forth in the following table
is information about the nominees for election to the Board of Directors, all of
whom are currently Directors of the Fund:
------------------------------ ------------------------ ---------------------------------------------- ------------------
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 January, 2002. (investment adviser) since July 1999; CFO,
Age: 43 Chairman of the Board Bethany College from 1995-1999; Director,
of the Fund since Boulder Total Return Fund, Inc., since
October 2004. Current January 2001; Director and Chairman of the
Nominee for a term to Board, First Financial Fund, Inc. since
expire at the 2006 August 2003.
annual meeting.
Alfred G. Aldridge, Jr. Director of the Fund Retired. From 1982-2002, Sales Manager of 2
Brig. Gen. (Retired) since January 2002. Shamrock Foods Company; Director of the
Cal. Air National Guard Current Nominee for a Fiesta Bowl, Tempe, AZ since 1997;
Age: 67 term to expire at the Director, Boulder Total Return Fund, Inc.,
2006 annual meeting. since 1999; Director, Maricopa Youth
Assistance Foundation, Phoenix, AZ since
2004; Executive Vice President, Business
Development Specialists, Phoenix, AZ since
2004.
Richard I. Barr Director of the Fund Retired. From 1963-2001, Manager of 3
Age: 66 since January 2002. Advantage Sales and Marketing, Inc (food
Current Nominee for a brokerage); Director, Boulder Total Return
term to expire at the Fund, Inc., since 1999 and Chairman of the
2006 annual meeting. Board since 2003; Director, First Financial
Fund, Inc., since 2001.
Dennis R. Causier Director of the Fund Retired. From 1966-2001, Managing Director 2
Age: 57 since October 2004. and Chairman of P.S. Group PLC (engineering
Current Nominee for a and construction); owner, Professional Yacht
term to expire at the Management Services; Director, First
2006 annual meeting. Financial Fund, Inc. since October, 2004.
------------------------------ ------------------------ ---------------------------------------------- ------------------
Interested Director**
------------------------------ ------------------------ ---------------------------------------------- ------------------
John S. Horejsi Director of the Fund President of HoJo Records, LLC (music 1
Age: 37 since May 2004. producer) since 2001; Director of Horejsi
Current nominee for a Charitable Foundation since 1997.
term to expire at the
2006 annual meeting.
* Unless otherwise specified, the Directors' respective addresses are c/o
Boulder Growth & Income Fund, Inc., 1680 38th Street, Suite 800, Boulder,
Colorado 80301.
** Mr. Horejsi is an "interested person" as a result of the extent of his
beneficial ownership of Fund shares and by virtue of his 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
January 21, 2005. This table also shows certain additional information. 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 Boulder Investment
1680 38th Street, since January 2002 and Advisers, LLC; Manager, Fund Administrative Services,
Suite 800 Director from January LLC ("FAS"); Vice President of Stewart Investment
Boulder, CO 80301 2002 through October Advisers; Director and President of Boulder Total Return
Age: 52 2004. Appointed Fund, Inc., since 1999 (resigned as Director in 2004);
annually. 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
1680 38th Street, Chief Accounting Manager of FAS, since April, 1999; Vice President, Chief
Suite 800 Officer, Vice President Financial Officer and Chief Accounting Officer, Boulder
Boulder, CO 80301 and Treasurer since Total Return Fund, Inc., since 1999 and First Financial
Age: 41 January 2002. Appointed Fund, Inc., since August 2003.
annually.
Stephanie J. Kelley Secretary since January Secretary, Boulder Total Return Fund, Inc., since
1680 38th Street, 2002. Appointed October 2000 and First Financial Fund, Inc., since
Suite 800 annually. August 2003; Assistant Secretary and Assistant Treasurer
Boulder, CO 80301 of various Horejsi Affiliates; employee of FAS since
Age: 48 March 1999.
Nicole L. Murphey Assistant Secretary Assistant Secretary, Boulder Total Return Fund, Inc.
1680 38th Street, since January 2002. since October 2000 and First Financial Fund, Inc. since
Suite 800 Appointed annually. August 2003; employee of FAS since July 1999.
Boulder, CO 80301
Age: 28
Set forth in the following table are the nominees for election to the Board
(all of whom are current Directors of the Fund) 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
-------------------------------------- -------------------------------- ---------------------------------
Alfred G. Aldridge, Jr. $10,001 to $50,000 $50,000 to $100,000
Richard I. Barr $50,001 to $100,000 Over $100,000
Joel W. Looney $10,001 to $50,000 Over $100,000
Dennis R. Causier $0 $0
Interested Directors and Nominees
-------------------------------------- -------------------------------- ---------------------------------
John S. Horejsi Over $100,000+ Over $100,000
+ 2,354,600 Shares of the Fund are held by the EH Trust. Accordingly, Mr.
Horejsi may be deemed to have indirect beneficial ownership of such Shares. Mr.
Horejsi disclaims all such beneficial ownership. 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, 2004. No persons (other than the independent 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. 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
----------------------------------------- ------------------- ----------------------------
Alfred G. Aldridge, Jr., Director $23,000 $49,500
(2 funds)
Richard I. Barr, Director $23,000 $79,000
(3 funds)
Joel W. Looney, Director and Chairman $25,000 $86,000
of the Board (3 funds)
Dennis R. Causier, Director $4,533 $10,566
(2 funds)
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 $1000 per meeting.
Each Director of the Fund is reimbursed for travel and out-of-pocket expenses
associated with attending Board and Committee meetings. The Board held eight
meetings (four of which were held by telephone conference call) during the
fiscal year ended November 30, 2004. 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. Directors currently serving
and who served less than the entire fiscal year attended at least 75% of such
meetings held during their tenure as a Director. The aggregate remuneration paid
to the Directors of the Fund for acting as such during the fiscal year ended
November 30, 2004 amounted to $75,532.97.
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 was attached as an appendix to the Fund's proxy in 2004. The Audit
Committee is composed entirely of the Fund's independent Directors, consisting
of Messrs. Aldridge, Barr, Causier and Looney. Each member of the Audit
Committee is independent, as that term is defined by the NYSE Listing Standards.
The Audit Committee met two times during the fiscal year ended November 30,
2004.
In connection with the audited financial statements as of and for the
period ended November 30, 2004 included in the Fund's Annual Report for the
period ended November 30, 2004 (the "Annual Report"), at a meeting held on
January 21, 2005, 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:
Alfred G. Aldridge, Jr.
Richard I. Barr
Dennis R. Causier
Joel W. Looney
NOMINATING COMMITTEE. The Board of Directors has a nominating committee
(the "Nominating Committee") consisting of Messrs. Looney, Aldridge, Causier 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 two times during the fiscal year ended November 30,
2004. The Nominating Committee met on March 17, 2004, to consider the nomination
of John S. Horejsi, the son of Stewart R. Horejsi, the Fund's portfolio manager.
John Horejsi was being considered to fill a vacancy on the Board resulting from
the resignation of Susan L. Ciciora. At this meeting, the Nominating Committee
considered the qualifications and determined the suitability of John Horejsi to
be Director and resolved to recommend John Horejsi to stockholders for election
at the 2004 Annual Meeting. The Nominating Committee met again on October 15,
2004 to consider the nomination of Dennis R. Causier. Mr. Causier was being
considered to fill a vacancy on the Board resulting from the resignation of
Stephen C. Miller as a Director of the Fund. Mr. Miller, previously an
interested director of the Fund, resigned in order to bring the Fund into
compliance with recent SEC regulations which that become effective in January
2006 and which require that 75% of the Board be non-interested directors 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
attended the May 18, 2004 Annual Meeting of Stockholders.
REQUIRED VOTE. The election of Messrs. Looney, Aldridge, Barr, Horejsi and
Causier as Directors 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.
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
AMENDMENT TO THE CHARTER TO ESTABLISH THE NUMBER OF DIRECTORS AT FIVE
The Board proposes and unanimously recommends that stockholders approve an
amendment to the Charter providing that the number of Directors shall be five.
Any subsequent amendment to this new Charter provision would require the
affirmative vote of the holders of a majority of all the votes entitled to be
cast on the matter. If stockholders approve this Proposal, the Fund will take
action to implement the Proposal by filing the appropriate charter documents
with the State Department of Assessments of Maryland ("SDAT"). If approved by
stockholders, Article 5, Section 1 will be repealed in its entirety and replaced
by the following provision:
The number of directors shall be five.
Purpose of the Amendment. The Board is submitting this Proposal to the
stockholders as part of its ongoing corporate governance initiatives and in
keeping with its goal of ensuring that the Fund's corporate governance policies
maximize Board and management accountability to stockholders. Last May,
stockholders approved a charter amendment that established the "maximum" number
of directors at five (5). In retrospect, the Board determined that the Fund
would be better served if the number of directors was fixed at five, no more, no
less. Company charters often contain provisions that permit the board to
increase or decrease the number of board seats in the board's discretion.
Currently the Fund's Charter sets a "maximum" on the Board seats at five (5),
leaving it to the discretion of the Board to decrease that number to no less
than that required by Maryland law (i.e., three). Boards often use such
provisions in an effort to dilute the voting impact of directors - such as those
elected in proxy contests - with views contrary to those of management. The
Board views the ability to manipulate the number of members on the Board as
unnecessary and ultimately ineffective in thwarting stockholder activism. In
addition, it potentially increases Fund expenses and insulates the Board from
stockholders.
The Board considered this Proposal as well as Proposal No. 3 at its meeting on
January 21, 2005. The Board has determined that this Proposal furthers the goal
of ensuring that the Fund's corporate governance policies maximize Board and
management accountability to stockholders and allow stockholders better and
consistent access to effect change in the Fund's governing documents.
Vote Required. Approval of Proposal 2 requires the affirmative vote of a
majority of the votes entitled to be cast on the matter by the holders of the
Common Stock.
THE BOARD OF DIRECTORS, INCLUDING ALL OF THE INDEPENDENT DIRECTORS, UNANIMOUSLY
RECOMMENDS THAT THE STOCKHOLDERS VOTE "FOR" PROPOSAL 2.
PROPOSAL 3
AMENDMENT TO THE CHARTER VESTING IN THE STOCKHOLDERS THE POWER TO
AMEND OR ADOPT BYLAWS
Last May, stockholders approved a charter amendment that would permit
stockholders to amend bylaws with a "majority of votes cast". After review, the
Board determined that the "majority of votes cast" standard was perhaps too
relaxed and might encourage unwanted activism and nuisance proposals to change
bylaws that would be costly and result in a diversion to the more important
business of the Fund. Accordingly, the Board proposes and unanimously recommends
that stockholders approve an amendment to the Charter which would impose a
"majority of outstanding shares" standard on stockholders' ability to adopt
bylaws. If Proposal 3 is approved, any subsequent proposal to amend the Charter
to alter stockholders' power to amend the Bylaws would require the affirmative
vote of the holders of a majority of all outstanding shares.
If stockholders approve this Proposal, the Fund will take action to
implement the Proposal by filing the appropriate Charter documents with the
SDAT. If approved by stockholders, Article 4.3 of the Charter will be amended by
deleting the phrase "cast at a stockholders meeting at which a quorum is
present;" with "entitled to be cast on the matter". Such that the amended
Article 4.3 would read as follows:
The Bylaws of the Corporation, whether adopted by the Board of
Directors or the stockholders, shall be subject to amendment,
alteration or repeal, and new Bylaws may be made, by either (a) the
affirmative vote of a majority of all the votes entitled to be cast on
the matter; or (b) the Board of Directors; provided, however, that the
Board of Directors may not (i) amend or repeal a Bylaw that allocates
solely to stockholders the power to amend or repeal such Bylaw, or
(ii) amend or repeal Bylaws or make new Bylaws that conflict with or
otherwise alter in any material respect the effect of Bylaws
previously adopted by the stockholders.
Purpose of the Amendment. The Board is submitting this Proposal to the
stockholders as part of its ongoing corporate governance initiatives and in
keeping with its goal of ensuring that the Fund's corporate governance policies
maximize Board and management accountability to stockholders. The Board believes
that the authority to make, alter or repeal Bylaws should be a shared authority
between the Board and stockholders. This permits the Board to be responsive to
house-keeping as well as substantive matters regarding Fund operations, while at
the same time giving stockholders the power to effect changes should they choose
to do so. However, the Board thinks it is important to place a sufficiently high
barrier on stockholders' ability to initiate bylaws so as to avoid unwanted
activism and nuisance proposals that are costly to the Fund, divert its
attention from its primary business and are generally not in the Fund's best
interest. The Board believes that this Proposal will accommodate the
practicalities of managing the Fund while at the same time protecting an
important right of stockholders to effect bylaw changes if there is sufficient
and broad stockholder support.
The Board considered this Proposal as well as Proposal No. 2 at its meeting on
January 21, 2005. The Board has determined that this Proposal furthers the goal
of ensuring that the Fund's corporate governance policies maximize Board and
management accountability to stockholders and allow stockholders better and
consistent access to effect change in the Fund's governing documents.
Vote Required. Approval of Proposal 3 requires the affirmative vote of a
majority of the votes entitled to be cast on the matter by the holders of the
Common Stock.
THE BOARD OF DIRECTORS, INCLUDING ALL OF THE INDEPENDENT DIRECTORS, UNANIMOUSLY
RECOMMENDS THAT THE STOCKHOLDERS VOTE "FOR" PROPOSAL 3.
PROPOSAL 4
ELIMINATION OF THE FUND'S FUNDAMENTAL INVESTMENT RESTRICTION ON PUTS AND CALLS
The Board proposes and unanimously recommends that stockholders approve the
elimination of the Fund's fundamental investment policy which prohibits the Fund
from writing, purchasing or selling puts and calls. Currently, one of the Fund's
investment restrictions provides that the Fund may not:
Write, purchase or sell puts, calls, or combinations thereof provided
that this shall not preclude the purchase and sale of warrants, rights
and convertible securities in accordance with the Fund's policies.
Proposal No. 4 would eliminate this restriction in its entirety.
Reasons for Proposal. The Board believes that this provision unnecessarily
restricts the Fund from participating in and profiting from buying, selling or
writing options on securities. This restriction was originally placed on the
Fund at its inception, under its former name, USLife Income Fund. At the time,
it was likely put in place to assure prospective stockholders that the advisor
would not participate in the options market, due to leverage considerations and
the general viewpoint from the public's eye that the options market is
speculative. However, because the Advisers now have a much broader mandate to
invest in a much wider range of equities, the Board believes that this
restriction unduly limits the abilities of the Advisers to maximize investor
return.
Options give a holder the right to buy or sell a security at a set price on
or before a date certain. A "call" option gives the holder the right to buy, and
a "put" option gives the holder the right to sell. "Writing" an option is the
practice of selling somebody else these rights. Whether or not the option is
exercised doesn't change the fact that the writer of the option keeps the
premium. The options market provides investors a way to leverage positions by
putting up a small sum of money to buy or sell control, or potential control, of
securities. Many option strategies are designed for hedging. The most common
example is the holder of a stock who wants to protect against any downside
movement in the stock, without actually selling the stock. He does this by
purchasing a "put" option on the stock (i.e., the right to sell the stock in the
future for a certain price). If the stock declines below the option's "strike
price" before its expiration, his option gives him the right to "put" or sell
the security to the holder of the put at the strike price, regardless of the
then current market price. This limits the loss the investor might otherwise
suffer.
Investing in options can be speculative because of the leverage that can be
used. For example, rather than buying 100 shares of an $80 stock for a total
cost of $8,000, a speculator may buy 10 call options (one option gives the right
to buy one round lot of 100 shares) at $2.00 per option for a total cost of
$2,000. So, for a short period of time, this investor has an interest in this
security for 1,000 shares at a cost of $2,000 vs. 100 shares at a cost of
$8,000. The Fund's Advisers would be most likely to use option strategies in an
arbitrage situation. An example would be in a merger situation where Company A
has proposed to buy Company B, and the Advisers may wish to be long one security
and short the other if there is a price arbitrage. One possible way to
accomplish this would be to buy or sell call or put options. Currently, the
Advisers know of no arbitrage situations in which they desire to use this
strategy. The Advisers may also use options to hedge certain perceived risks.
The Board considered this Proposal at its meeting on January 21, 2005.
Notwithstanding the risks mentioned above, the Board believes that approving the
removal of this restriction on options will benefit the Fund and its
stockholders by providing the Advisers with the ability to use options if the
circumstances are warranted.
Vote Required. Proposal 4 requires the "vote of a majority of the outstanding
voting securities" (as set forth Section 2(a)(42) of the 1940 Act), that is, 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 foregoing standard is generally referred
to as a "1940 Act Majority Vote".
THE BOARD OF DIRECTORS, INCLUDING ALL OF THE INDEPENDENT DIRECTORS, UNANIMOUSLY
RECOMMENDS THAT THE STOCKHOLDERS VOTE "FOR" PROPOSAL 4.
PROPOSAL 5
ELIMINATION OF THE FUND'S FUNDAMENTAL INVESTMENT RESTRICTION REGARDING
INVESTMENT IN FOREIGN SECURITIES
The Board proposes and unanimously recommends that stockholders approve the
elimination of the Fund's fundamental investment policy regarding investments in
foreign securities. Currently, one of the Fund's fundamental investment
restrictions provides that:
The Fund shall invest no more than 20% of its assets in foreign
securities, except that the Fund may invest not more than 25% of the
value of its total assets in securities of, or guaranteed by, the
Government of Canada or of a Province of Canada or any instrumentality
or political subdivision thereof.
Proposal No. 5 would eliminate this restriction in its entirety.
Reasons for Proposal. The Board believes that this provision unnecessarily
restricts the Fund from participating in and profiting from attractive foreign
securities. Presently, the Fund is close to its foreign-securities limit of 20%
of its assets. Similar to the put-call restriction discussed in Proposal 4
above, this restriction was originally placed on the Fund at its inception,
likely to assure prospective stockholders that the advisor would not participate
in foreign securities which may have been viewed as speculative at the time.
However, with the introduction of the Euro and the recent decline in the
relative strength of the U.S. Dollar, the Board believes that the Fund needs the
flexibility to invest a larger percentage of its assets in the securities of
foreign issuers. The Board believes that foreign stocks, especially those that
trade on foreign exchanges in foreign currencies, may present the Fund better
opportunities than those currently found in the U.S. Because the Fund is so
close to its limitation of owning no more than 20% in foreign securities, the
Board recommends that stockholders vote in favor of removing this restriction.
Investments in foreign securities (including those denominated in U.S.
dollars) involve certain risks not typically associated with investments in
domestic issuers. These risks can include political and economic instability,
foreign taxation issues, different or lower standards in accounting, auditing
and financial reporting, less-developed securities regulation and trading
systems, fluctuations in foreign currency exchange rates, and the risk that a
country may impose controls on the exchange or repatriation of foreign currency.
These risks are intensified when investing in countries with developing
economies and securities of many foreign issuers may be less liquid and their
prices more volatile than those of comparable domestic issuers. In general, less
information is publicly available about foreign companies than about U.S.
companies. Foreign companies are generally not subject to the same accounting,
auditing and financial reporting standards as are U.S. companies. Transactions
in foreign securities may be subject to less efficient settlement practices,
including extended clearance and settlement periods. Foreign stock markets may
be less liquid and less regulated than U.S. stock markets.
The risks of foreign investment are greater for investments in emerging
markets. Although the Advisers do not anticipate investing in emerging markets,
removal of the foreign securities restriction would permit them to invest in
emerging market countries. Emerging market countries typically have economic and
political systems that are less fully developed, and can be expected to be less
stable, than those of more advanced countries. Low trading volumes may result in
a lack of liquidity and in price volatility. Emerging market countries may have
policies that restrict investment by foreigners, or that prevent foreign
investors from withdrawing their money at will.
Since removal of this restriction will permit the Fund to invest
significantly in securities denominated in foreign currencies, the Funds may
incur currency conversion costs, and may be affected favorably or unfavorably by
changes in the rates of exchange between those currencies and the U.S. and
foreign governments or central banks, the imposition of currency controls, and
speculation.
The Board considered this Proposal at its meeting on January 21, 2005.
Notwithstanding the risks mentioned above, the Board believes that approving the
removal of this restriction on investments in foreign securities will benefit
the Fund and its stockholders by providing the Advisers with the ability to
invest in foreign securities if the circumstances are warranted.
Vote Required. Approval of Proposal 5 requires a 1940 Act Majority Vote.
THE BOARD OF DIRECTORS, INCLUDING ALL OF THE INDEPENDENT DIRECTORS, UNANIMOUSLY
RECOMMENDS THAT THE STOCKHOLDERS VOTE "FOR" PROPOSAL 5.
SUBMISSION OF STOCKHOLDER PROPOSALS
All proposals by stockholders of the Fund that are intended to be presented
at the Fund's next Annual Meeting of stockholders to be held in 2006 must be in
writing and received by the Fund for consideration for inclusion in the Fund's
proxy statement relating to the meeting no later than [December 6, 2005]. 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.
Any submission of a director nomination should include at a minimum the
following information: As to each individual proposed for election or
re-election as director, the name, age, business address, residence address and
principal occupation or employment of such individual, the class, series and
number of shares of stock of the Fund that are beneficially owned by such
individual, the date shares were acquired and the investment intent of such
acquisition, whether such stockholder believes 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
Nominating Committee, to make such determination, and all other information
relating to such individual that is required to be disclosed in solicitation 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 Securities Exchange Act of
1934, as amended, 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)). In the case of the Fund holding a meeting of
stockholders, any such submission in order to be considered for inclusion in the
Fund's proxy statement, should be submitted by a date not later than the 120th
calendar day before the date the Fund's proxy statement was released to security
holders in connection with the Fund's previous year's annual meeting or, if the
Fund has changed the meeting date by more than 30 days or if no meeting was held
the previous year, within a reasonable time before the Fund begins to print and
mail its proxy statement.
A stockholder may nominate an individual to serve as a director or propose
other business at an annual meeting, even if the stockholder does not submit the
nomination or proposal for inclusion in the Fund's proxy statement. In this
case, the stockholder must provide notice to the Fund, including certain of the
information described above, at least 60 days before the date of the annual
meeting. If less than 70 days' notice or prior public disclosure of the meeting
is given or made to the stockholders, the stockholder's notice to the Fund must
be received by the Fund not later than the close of business on the tenth day
following the day on which the notice of the date of the annual meeting is given
or the public disclosure was made.
ADDITIONAL INFORMATION
INDEPENDENT ACCOUNTANTS. On January 21, 2005, the Audit Committee of the
Board, consisting of those Directors who are not "interested persons" (as
defined in the 1940 Act), selected KPMG LLP ("KPMG"), 99 High Street, Boston,
Massachusetts 02110-2371, as independent accountants for the Fund for the Fund's
fiscal year ending November 30, 2005. The selection of KPMG was ratified by the
entire Board. KPMG also served as independent accountants for the Fund for the
Fund's fiscal year ending November 30, 2004. A representative of KPMG 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 years
ended November 30, 2003 and 2004, respectively.
Fiscal Year Ended Audit Fees Audit-Related Fees Tax Fees* All Other Fees
----------------- ---------- ------------------ --------- --------------
11/30/2003 $22,500 $0 $5,600 $ 0
11/30/2004 $23,600 $0 $ 5,850 $ 0
* "Tax Fees" are those fees billed to each Fund by KPMG in connection with
tax consulting services, including primarily the review of each Fund's
income tax returns.
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 years ended November 30, 2003 and November 30, 2004
were pre-approved by the Audit Committee.
KPMG 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, 2004, KPMG
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 have engaged KPMG from time to time in the past to
provide various accounting, auditing and consulting services and currently
engages KPMG as a consultant with respect to ongoing tax related issues. For the
twelve months ended November 30, 2003, the Horejsi Affiliates paid $875 to KPMG
for their services. For the twelve months ended November 30, 2004, the Horejsi
Affiliates paid $3,800 to KPMG 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. However, with respect to Proposals y2 and 3, where the vote
required to approve the matter is the affirmative vote of the holders of a
percentage of the total number of votes entitled to be cast, an abstention will
have the effect of a vote "against" the respective proposals. Similarly, with
respect to Proposals 4 and 5, where the vote required to approve the matter is
the affirmative vote of the holders of either (i) a percentage of the total
number of votes entitled to be cast or (ii) a percentage of the voting
securities present at the meeting, an abstention will have the effect of a vote
"against" the proposal.
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.
--------------------------------------------------------------------------------
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 Candace C. Cavalier, 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
Millennium Resort McCormick Ranch, 7401 N. Scottsdale Road, Scottsdale, Arizona
at 9:00 a.m. Mountain Standard Time (local time), on April 26, 2005, 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 1 THROUGH 6.
Please refer to the Proxy Statement for a discussion of the Proposals.
1 Election of Directors: Nominees are Richard I. Barr, Joel W. Looney, Alfred
G. Aldridge, Jr., John S. Horejsi, and Dennis R. Causier.
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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STOCKHOLDERS MAY VOTE WITH RESEPCT TO ALL OF THE PROPOSALS 2 THROUGH 5
BY MAKING THE APPROPRIATE OMNIBUS SELECTION TO THE RIGHT
FOR___ AGAINST ___ ABSTAIN ___
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2 An amendment to the Fund's charter (the "Charter") to establish the number
of Directors at five (5).
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
3 An amendment to the Charter changing the voting standard for stockholders
to amend or adopt Bylaws to the affirmative vote of a majority of all the
votes entitled to be cast on the matter.
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
4 To eliminate the Fund's fundamental investment restriction on writing,
purchasing or selling puts and calls.
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
5 To eliminate the Fund's fundamental investment restriction regarding
investment in foreign securities.
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
6 TO VOTE AND OTHERWISE REPRESENT THE UNDERSIGNED ON ANY OTHER MATTER THAT
MAY PROPERLY COME BEFORE THE ANNUAL MEETING OR ANY ADJOURNMENT OR
POSTPONEMENT THEREOF IN THE DISCRETION OF THE PROXY HOLDER
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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