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:
[ X ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted by
Rule 14a-6(e)(2))
[ ] 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) 444-5483
(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.
BOULDER FUNDS 2344 SPRUCE STREET, SUITE A
BOULDER, COLORADO 80302
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
To Be Held on __________, 2010
To the Stockholders:
Notice is hereby given that the Annual Meeting of Stockholders of Boulder
Growth & Income Fund, Inc., a Maryland corporation (the "Fund"), will be held at
___________________ at 9:00 a.m., __________ Daylight Time (local time), on
_________, 2010, to consider and vote on the following Proposals, all of which
are more fully described in the accompanying Proxy Statement:
1. The election of two Class I Directors of the Fund (Proposal 1);
2. To consider and vote upon, if properly presented at the meeting, a
stockholder proposal with respect to amending the Fund's bylaws
(Proposal 2); and
3. To transact such other business as may properly come before the
Meeting or any adjournments and postponements thereof.
This meeting is extremely important in light of the announcement by a
dissident shareholder, Western Investment Hedged Partners, L.P, ("Western
Investment"), an unregistered investment company controlled by Arthur Lipson, of
its intention to solicit proxies against the nominees of your Board of
Directors. In addition, another dissident shareholder, Larry Lattimore, has also
made a stockholder proposal, included in this proxy statement as Proposal 2,
which your Board of Directors strongly opposes.
The Board of Directors of the Fund has fixed the close of business on
_____, 2010 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 _________, 2010.
By Order of the Board of Directors,
Stephanie Kelley
Secretary
____________, 2010
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STOCKHOLDERS ARE REQUESTED TO COMPLETE, SIGN AND DATE THE ENCLOSED PROXY CARD OR
AUTHORIZE 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.
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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., by [title of authorized
officer]
(2) ABC Corp., c/o John Doe Treasurer John Doe
(3) 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.
BOULDER FUNDS 2344 SPRUCE STREET, SUITE A
BOULDER, COLORADO 80302
ANNUAL MEETING OF STOCKHOLDERS
__________, 2010
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 exercise at the Annual Meeting of
Stockholders of the Fund to be held on __________, 2010, at 9:00 a.m., ________
Daylight Time (local time), at _____________________, and at any adjournments
and postponements thereof (the "Meeting"). A Notice of Annual Meeting of
Stockholders and proxy card accompany this Proxy Statement. This Proxy
Statement, Notice of Meeting and form of proxy are first being mailed to
stockholders on _______, 2010. Proxy solicitations may be made, beginning on or
about ________, 2010, primarily by mail, but proxy solicitations may also be
made by telephone, by Internet on the Fund's website, email, facsimile or
personal interviews conducted by officers of the Fund and proxy solicitors
engaged in the discretion of the Fund. Any cost 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
______, 2010 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, 2009, 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. ALPS Fund
Services, Inc. ("ALPS") acts as the co-administrator to the Fund and is located
at 1290 Broadway, Suite 1100, Denver, Colorado 80203. PNC Global Investment
Servicing Inc. ("PNC") 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 _________, 2010 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
Proposal 1, AGAINST Proposal 2, and in the discretion of the proxy holder 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
delivering a written 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 votes
entitled to be cast (without regard to class) as of the Record Date. Each of the
outstanding Shares (as defined below) is entitled to cast one vote. In the event
that a quorum is not present at the Meeting, the chairman of the meeting may
adjourn the meeting to a date not more than 120 days after the Record Date
without notice other than an announcement at the meeting. 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. Any such adjournment will require the affirmative vote of a majority of
votes cast on the matter at the Meeting. 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.
If you hold your common shares in "street name" (that is, through a broker or
other nominee), your broker or nominee will not vote your shares unless you
provide instructions to your broker or nominee on how to vote your shares. You
should instruct your broker or nominee how to vote your shares by following the
directions provided by your broker or nominee.
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"), 10,000 shares of which have been designated as auction market preferred
stock or "AMPS" (the Common Stock and Preferred Stock 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 Preferred Stock
Outstanding Outstanding
------------ ---------------
25,495,585 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 is known by the Fund to beneficially own 5%
or more of the Fund's outstanding Common Stock.
Name of Owner* Number of Shares Number of Shares Percentage
Directly Owned Beneficially Owned Beneficially Owned
------------------------------------- ------------------ ---------------------- -----------------------
Ernest Horejsi Trust No. 1B* UPDATE UPDATE UPDATE%
Alaska Trust Company* --- ---** UPDATE%
Stewart West Indies Trust* --- ---** UPDATE%
Aggregate Shares Owned by Horejsi UPDATE UPDATE UPDATE%
Affiliates (defined below)
Doliver Capital Advisors, LP*** --- UPDATE UPDATE%
------------------------------------- ------------------ ---------------------- -----------------------
* The address of each listed Trust is c/o Alaska Trust Company 1029 West Third
Street, Suite 400, Anchorage, AK 99501.
** Excludes shares owned by the Ernest Horejsi Trust No. 1B (the "EH Trust").
Alaska Trust Company ("ATC") is one of three trustees of the EH Trust. ATC is a
state-chartered public trust company organized under the laws of Alaska; 98% of
its outstanding shares are owned by Stewart West Indies Trust ("SWIT"), an
irrevocable trust organized by Stewart R. Horejsi for the benefit of his issue.
Douglas Blattmachr, President of ATC, owns 2% of the outstanding shares of ATC.
The Directors and officers of ATC are Larry Dunlap (Director), Stephen C. Miller
(Vice President and Director), Mr. Blattmachr (President, Chariman and
Director), Brandon Cintula (Vice President and Director) and Richard Thwaites,
Jr. (Secretary/Treasurer and Director). Together with ATC and Mr. Dunlap, Susan
Ciciora is a Trustee of the EH Trust and also one of the beneficiaries of the EH
Trust. Ms. Ciciora is a Director of the Fund.
***As stated in Schedule 13G Amendment No. ___ filed with the Securities and
Exchange Commission on ___________
The following table sets forth certain information regarding the beneficial
ownership of the Preferred Stock as of the Record Date by each person who is
known by the Fund to beneficially own 5% or more of such outstanding Preferred
Stock.
Name of Owner Number of Number of Percentage
Shares Shares Beneficially
Directly Owned Beneficially Owned
Owned
--------------------------- ---------------- ---------------- ------------------
Bank of America --- 852++ 85.2%++
Corporation, Merrill
Lynch, Pierce, Fenner &
Smith Incorporated and
Blue Ridge Investments,
L.L.C.
--------------------------- ---------------- ---------------- ------------------
++ As stated in Schedule 13G Amendment No. 4 filed with the Securities and
Exchange Commission on March 12, 2010.
--------------------------
The EH Trust, ATC and SWIT, 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 paragraphs 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, ______ shares or ______% of
Common Stock outstanding and 1,000 shares or 100% of the Preferred Stock
outstanding.
As of the Record Date, the executive officers and directors of the Fund, as a
group, owned _________ 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 Preferred Stock, representing _______% of Common Stock
outstanding and 0% of the Preferred Stock.
In order that your Shares may be represented at the Meeting, you are requested
to execute and return the enclosed proxy authorizing the proxy holders to vote
on the following matters:
PROPOSAL 1
ELECTION OF DIRECTORS OF THE FUND
The Board is divided into three classes (Class I, Class II, and Class III), each
class having a term of three years. Each year the term of one class expires and
the successor or successors elected to such class will serve until the Fund's
annual meeting of stockholders in the third succeeding year and until their
successors are duly elected and qualify. No Class II or Class III Directors are
up for election at this Meeting.
The Board has nominated John S. Horejsi and Dean L. Jacobson to stand for
election as Class I Directors to serve until the Fund's 2013 Annual Meeting of
Stockholders and until their successors are duly elected and qualify.
Under the Fund's charter, Mr. Horejsi is nominated for a seat voted on by the
Preferred Stockholders and Dr. Jacobson is nominated for a position voted on by
the Common Stockholders and Preferred Stockholders voting together.
Following the unanimous recommendation of its Nominating Committee, the Board
unanimously recommends a vote FOR both Mr. Horejsi and Dr. Jacobson because they
each have significant experience as directors of closed-end investment companies
and, in particular, the Fund, and have dealt skillfully with a broad range of
complex issues vis-a-vis the Fund and its affiliated investment companies,
including, most recently, the financial crisis which occurred during late 2008.
In December 2009, a stockholder, Western Investment Hedged Partners, L.P,
("Western Investment"), an unregistered investment company controlled by Arthur
D. Lipson, indicated its intent to nominate Daniel K. Osborne for the seat for
which the Board has nominated Dr. Jacobson. In response, as has been its
practice with all suggested nominees, the Fund's nominating committee (the
"Nominating Committee") sought to conduct a background check on Mr. Osborne. The
Nominating Committee does this with respect to any director nominee, regardless
of the source of the nomination. Background checks include the nominee's credit
history and any criminal background, securities and other litigation or
enforcement actions and bankruptcies involving the nominee, and also the
nominee's business experience, education and diversity of experiences,
directorships with other publicly traded or private companies, and the like. In
an effort to conduct this background check with respect to Mr. Osborne following
his recommendation as a director-nominee by Western Investment, the Nominating
Committee made a number of requests to Western Investment and/or Mr. Osborne to
provide basic information necessary for the Nominating Committee to conduct its
due diligence with respect to Mr. Osborne. Western Investment and/or Mr. Osborne
refused to provide certain of the requested information and, consequently, the
Nominating Committee decided not to consider Mr. Osborne as a Board nominee, in
part because his credentials, background information and credit, criminal and
securities industry history could not be independently verified.
The Board of Directors and the Nominating Committee were also reluctant to
propose Mr. Osborne as a director because Western Investment, who proposed him,
has a history of seeking board seats in other funds and promoting what the Board
regards as ill-conceived proposals harmful to the interests of long-term
stockholders. The person "sponsoring" Mr. Osborne, Arthur Lipson/Western
Investment, has a history of engaging in hostile tactics with various closed-end
fund managers in order to seek short-term gains at the expense of long-term
stockholders. For example, with Tri-Continental Corp., Mr. Lipson attempted to
replace the board of directors and advocated short-term changes the fund's board
regarded as not in the fund's long term interests; with DWS Global Commodities
Stock Fund, where he advocated converting the the fund to an exchange-traded
fund, or exchange-traded note, or as a last resort open-ending or liquidating
the fund and stated publicly that he was simply "playing the discount to
narrow"; with MBIA Capital/Claymore Managed Duration Investment Grade Municipal
Fund, he sought to promote a short-term strategy. Such proposals for short-term
gains are contradictory to the stated purposes of the Fund with its focus on
long-term total return for all stockholders. The Board believes that it is
unclear whether Mr. Osborne would take direction from Western Investments or
would act on behalf of all holders, and therefore believes that election of Mr.
Osborne could be harmful to stockholder interests.
It is not clear when or whether Western Investments will solicit proxies
authorizing votes for Mr. Osborne. However, the Nominating Committee and the
Board unanimously recommends that stockholders not execute any proxy sent by
Western Investments and instead vote FOR Dr. Jacobson.
INFORMATION ABOUT DIRECTORS AND OFFICERS. Set forth in the following table is
information about the Board of Directors:
Name Age Director Current Term Expires Position
Since
------------------------- ------ ------------ -------------------------------- ----------
Independent Directors
Joel W. Looney 48 2002 2011 Chairman
Richard I. Barr 72 2002 2012 Director
Dr. Dean Jacobson 71 2006 Current nominee. If elected, Director
term expires in 2013.
Interested Directors
Susan L. Ciciora 45 2006 2012 Director
John S. Horejsi 42 2004 Current nominee. If elected, Director
term expires in 2013.
INFORMATION ABOUT THE DIRECTORS' QUALIFICATIONS, EXPERIENCE, ATTRIBUTES AND
SKILLS.
The Board believes that each of the Directors have the qualifications,
experience, attributes and skills appropriate to their continued service as
Directors of the Fund in light of its business and structure. Each Director has
substantial business and professional background and/or board experience that
indicate their ability to critically review, evaluate and respond appropriately
to information provided to them. Certain of these business and professional
experiences are set forth in detail in the narratives below. In addition, each
Director has served on boards for investment companies and organizations other
than the Fund, as well as having served on the Board of the Fund for a number of
years. They therefore have substantial board experience and, in their service to
the Fund, have gained substantial insight as to the operation of the Fund. The
Board annually conducts a "self-assessment" wherein the effectiveness of the
Board and individual Directors is reviewed.
Below is information concerning each particular Director and certain of their
pertinent qualifications, experience, attributes and skills. The information
provided below, and in the chart above, is not all-inclusive. Many of the
Directors' attributes involve intangible elements, such as intelligence, work
and investment ethic, diversity in terms of background or experiences, an
appreciation of and belief in the long-term investment approach of the Fund, the
ability to work together collaboratively, the ability to communicate
effectively, the ability to exercise judgment, to ask incisive questions, to
manage people and problems or to develop solutions. In conducting its annual
self-assessment, the Board has determined that the Directors have the
appropriate qualifications, skills, attributes and experience to continue to
serve effectively as Directors of the Fund.
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 considered "interested persons" because of the extent of their
beneficial ownership of Fund shares and by virtue of their indirect beneficial
ownership of BIA and FAS. The following sets forth the backgrounds and business
experience of the Directors:
Joel W. Looney, Director and Chairman of the Board. Mr. Looney joined the
Board in 2002 and sits on the boards of three other closed-end investment
companies affiliated with the Fund - the Boulder Total Return Fund ("BTF")
since 2001, The Denali Fund ("DNY") since 2007, and First Opportunity Fund
since 2003 ("FF"; together, the "Affiliated Funds"). Mr. Looney has
significant financial, accounting and investment knowledge and experience.
He holds a Certified Financial Planner ("CFP") designation and, since 1999,
has been a principal and partner with Financial Management Group, LLC, an
investment management firm in Salina, KS ("FMG"). Mr. Looney is a
registered representative with VSR Financial Services, Inc. of Overland
Park, Kansas and holds FINRA-approved Series 7, Series 63 Uniform State Law
and Series 65 Uniform Investment Adviser Law certifications. Prior to his
current position with FMG, Mr. Looney was vice president and CFO for
Bethany College in Lindsborg, Kansas (1995 to 1999) and also served as vice
president and CFO for St. John's Military School in Salina, Kansas (1986
to1995). 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. Mr. Looney holds a B.S. from Marymount
College and an MBA from Kansas State University.
Richard I. Barr, Director. Mr. Barr joined the Board in 2002 and sits on
the boards of each of the three Affiliated Funds; BTF since 1999, DNY since
2007, and FF since 2001. Mr. Barr has extensive business, executive and
board experience including positions as president and director of Advantage
Sales and Marketing (1996 to 2001), president and CEO of CBS Marketing
(1963 to 1996), member of the board of directors (and National Chairman)
for the Association of Sales and Marketing Companies (formerly the National
Food Brokers Association), president of the Arizona Food Brokers
Association, and advisory board member for various food manufacturers,
including H.J. Heinz, ConAgra, Kraft Foods, and M&M Mars. In addition to
these professional positions and experience, Mr. Barr has served in a
number of leadership roles with various charitable or other non-profit
organizations, including as member of the board of directors of Valley Big
Brothers/Big Sisters, member of the board of advisers for University of
Kansas Business School, and member of the board of directors for St. Mary's
Food Bank.
Dr. Dean Jacobson, Director. Dr. Jacobson joined the Board in 2006 and sits
on the boards of each of the three Affiliated Funds; BTF since 2004, DNY
since 2007, and FF since 2003. He has significant executive and business
experience and extensive academic qualifications. Since 1985, Dr. Jacobsen
has been president and CEO of Forensic Engineering, Inc., a consulting
engineering firm providing scientific and technical expertise in a number
of areas where discovery related to property damage and/or personal injury
is necessary (e.g., accident reconstruction, failure and design analysis of
products, animation and simulation of fires, explosions and mechanical
system functions). He sits on the boards of directors of Southwest Mobile
Storage Inc. (1995 to Present), Arizona State University Foundation, (1999
to 2009) and Arizona State University Sun Angel Foundation (past chairman)
(1995 to Present). He is a Professor Emeritus at Arizona State University
("ASU") and held a number of faculty and advisory positions at ASU between
1971 and 1997, including director of the Science and Engineering of
Materials Ph.D. program and tenured professor of Engineering, and he has
also served as a professor and/or research assistant at the University of
California at Los Angeles ("UCLA") (1964 to 1969) and the University of
Notre Dame ("Notre Dame") (1957 to 1963). Dr. Jacobson is a renowned expert
in business engineering processes and has published over 130 scholarly and
peer-reviewed research articles in numerous academic, research and business
journals and publications. He holds two patents and a number of
professional and business designations. He holds a B.S. and an M.S. from
Notre Dame, and a Ph.D. from UCLA.
Susan L. Ciciora, Director. Ms. Ciciora joined the Board in 2006 and sits
on the boards of each of the three Affiliated Funds; BTF since 2001, DNY
since 2007 and FF since 2003. She has extensive board experience as one of
three trustees of the Lola Brown Trust No. 1B since 1994 and the Ernest
Horejsi Trust No. 1B since 1992. Ms. Ciciora has other business
experiences, including various executive positions with a mid-west welding
supply company and a custom home construction company. She also has served
as a director of the Horejsi Charitable Foundation, Inc. since 1997. She
holds a B.S. from the University of Kansas.
John S. Horejsi, Director. Mr. Horejsi joined the Board in 2004 and sits on
the boards of each of the three Affiliated Funds; BTF and FF since 2006 and
DNY since 2007. Mr. Horejsi has both executive and business experience. He
has been involved in a number of business ventures, including as manager of
a record label and music production company, various positions with a
mid-west regional welding supply business and as part owner and driver for
an automobile racing team. Mr. Horejsi also has board experience outside of
the Funds as a director of the Horejsi Charitable Foundation, Inc. (since
1997). Mr. Horejsi previously held a commercial real estate license in
California. Mr. Horejsi holds a B.S. from the University of Kansas.
OFFICERS. The names of the executive officers of the Fund are listed below. Each
officer was elected by the Board at a meeting held on April 24, 2009. Officers
are elected annually and each officer will hold such office until a successor
has been elected by the Board.
Stephen C. Miller, President. Age: 57. Mr. Miller is (and has been since
2002) president of the Fund. He was a director from 2002 to 2004 and chief
compliance officer from 2004 to 2007. He is also president of and general
counsel to BIA (since 1999); manager of Fund Administrative Services, LLC
("FAS") (since 1999); and vice president of SIA (since 1999). Mr. Miller
was a director of BTF from 1999 to 2004 and is its current president (since
1999); a director and chairman of FF from 2003 to 2004 and is its current
president (since 2003); and is DNY's current president (since 2007). Mr.
Miller practiced law in the Denver office of Kirkland & Ellis from 1987 to
1992 and started a private practice in Boulder, Colorado in 1992. Mr.
Miller became in-house counsel to the Horejsi Affiliates in 1998 and has
served in a number of executive management capacities for those affiliates.
Mr. Miller maintains his law firm, Stephen C. Miller, P.C., and "of
counsel" status with the law firm of Krassa & Miller, LLC. Mr. Miller holds
a B.S. from the University of Georgia and a J.D. from the University of
Denver.
Carl D. Johns, Vice President. Age: 47. Mr. Johns is (and has been since
2002) the Fund's chief financial officer, chief accounting officer, vice
president and treasurer. He is also vice president and treasurer of BIA
(since 1999); assistant manager of FAS (since 1999); and vice president,
treasurer, chief financial officer and chief accounting officer of each of
the Affiliated Funds: BTF since 1999, FF since 2003 and DNY since 2007.
Prior to his current position with BIA, he spent seven years with the firm
of Flaherty & Crumrine, a registered investment adviser in Pasadena,
California, which managed preferred stock portfolios. Mr. Johns holds a
B.S. in Mechanical Engineering and a M.S. in Finance, both from the
University of Colorado.
Joel L. Terwilliger, Chief Compliance Officer. Age: 41. Mr. Terwilliger is
(and has been since 2007) the Fund's chief compliance officer, and
associate general counsel since 2006. He is (and has been since 2007) the
chief compliance officer for BIA, SIA, FAS and each of the Affiliated
Funds. Prior to his employment with FAS, Mr. Terwilliger was employed from
2002 to 2006 as senior associate/legal counsel for Great West Life &
Annuity Insurance Company ("Great-West") in Greenwood Village, Colorado. At
Great-West, Mr. Terwilliger served primarily as a business and securities
law attorney responsible for complex financial services negotiations and
contracts. Mr. Terwilliger holds a B.A., J.D., and LL.M. from the
University of Georgia.
Stephanie J. Kelley, Secretary. Age: 53. Ms. Kelley is (and has been since
2002) the Fund's Secretary. She also serves as secretary for each of the
Affiliated Funds: BTF since 2000, FF since 2003 and DNY since 2007. Ms
Kelley also serves as assistant secretary and assistant treasurer of
various other entities affiliated with the Horejsi family and has been an
employee of FAS since 1999. Ms. Kelley holds a B.A. and an MBA from the
State University of New York, Binghamton.
Nicole L. Murphey, Vice President and Assistant Secretary. Age: 33. Ms.
Murphey is (and has been since 2008) a vice president of the Fund, and
assistant secretary since 2002. She is also vice president (since 2008) of
each of the Affiliated Funds and assistant secretary for BTF since 2000, FF
since 2003 and DNY since 2007. Ms. Murphey is also assistant treasurer of
FAS and has been an employee of FAS since 1999. Ms. Murphey holds a B.A.
from the University of Colorado.
Unless otherwise specified, the Officers' respective addresses are c/o Boulder
Growth & Income Fund, Inc., 2344 Spruce Street, Suite A, Boulder, Colorado
80302.
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 the Advisers).
OWNERSHIP OF SECURITIES 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 $ UPDATE Over $ UPDATE
Joel W. Looney $ UPDATE Over $ UPDATE
Dean L. Jacobson $ UPDATE Over $ UPDATE
-------------------------------------- -------------------------------- ---------------------------------
Interested Directors and Nominees
-------------------------------------- -------------------------------- ---------------------------------
John S. Horejsi Over $ UPDATE + Over $ UPDATE
Susan L. Ciciora Over $ UPDATE + Over $ UPDATE
---------------------------------------------------------------------------------------------------------
+ UPDATE 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
directly owns UPDATE shares of the Fund. Mr. Horejsi does not directly own any
shares of the Fund.
---------------------------
None of the Independent Directors (i.e., directors who are not "interested
persons" of the Fund (as defined in the Investment Company Act of 1940, as
amended (the "Act")) (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 Directors for the fiscal year
ended November 30, 2009. 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. Independent Directors receive
reimbursement for travel and other out-of-pocket expenses incurred in connection
with attending Board and Board committee 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
----------------------------------------- ------------------- ----------------------------
Joel W. Looney, Director and Chairman $28,500 $ UPDATE
of the Board (4 funds)
Richard I. Barr, Director $22,500 $ UPDATE
(4 funds)
Dr. Dean Jacobson, Director $22,500 $ UPDATE
(4 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. The chairman of the Board and
the chairman of the audit committee each receive an additional $1,000 per
meeting. The Board held seven meetings (three of which were held by telephone
conference call) during the fiscal year ended November 30, 2009. 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, 2009 amounted to $73,500.
COMMITTEES OF THE BOARD OF DIRECTORS
AUDIT COMMITTEE; REPORT OF AUDIT COMMITTEE. The purpose of the Fund's audit
committee ("Audit Committee") is to assist Board's oversight of the integrity of
the Fund's financial statements, the Fund's compliance with legal and regulatory
requirements, the independent accountants' qualifications and independence and
the performance of the Fund's independent accountants. 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 29, 2010 to comply
with recent changes in corporate governance provisions affecting registered
investment companies generally and the Fund specifically. A copy of the Audit
Committee Charter is available on the Fund's website at www.boulderfunds.net.
The Audit Committee is composed entirely of the Fund's Independent Directors,
consisting of Messrs. Barr, Jacobson and Looney. The Board has determined that
Joel Looney qualifies as an "audit committee financial expert," as defined under
SEC 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 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 twice during the fiscal year
ended November 30, 2009.
In connection with the audited financial statements as of and for the period
ended November 30, 2009, included in the Fund's Annual Report for the period
ended November 30, 2009 (the "Annual Report"), at meetings held on January 25,
2010 and January 29, 2010, 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. 114, The
Auditor's Communication with Those Charged With Governance, effective December
15, 2006.
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 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, and 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 and also in certain circumstances where a
person may be proposed as a director-nominee by a stockholder. Each member of
the Nominating Committee is independent, as that term is defined by the NYSE
Listing Standards. The Nominating Committee met ___ times during the fiscal year
ended November 30, 2009. 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
investment philosophy, 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.
Although the Nominating Committee does not have a formal policy with regard to
the consideration of diversity in identifying director candidates, as a matter
of practice the Committee typically considers the overall diversity of the
Board's composition when identifying candidates. Specifically, the Nominating
Committee considers the diversity of skill sets desired among the Board members
in light of the Fund's characteristics and circumstances and how those skill
sets might complement each other. The Nominating Committee also takes into
account the personal background of current and prospective Board members in
considering the composition of the Board. In addition, as part of its annual
self-evaluation, the directors have an opportunity to consider the diversity of
the Board, both in terms of skill sets and personal background, and any
observations made by the Board during the self-evaluation assist the Nominating
Committee in its decision making process.
The Nominating Committee will 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). In reviewing such stockholder
director-nominees, the Nominating Committee may generally rely on the provisions
set forth in Nominating Committee charter and other information as deemed
necessary to adjudge the appropriateness and character of such
director-nominee(s). Such recommendations should be forwarded to the Secretary
of the Fund.
The Fund does not have a compensation committee.
ADDITIONAL INFORMATION CONCERNING OUR BOARD OF DIRECTORS
COMMUNICATIONS WITH THE BOARD. 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, 2009 Annual Meeting of
Stockholders.
ROLE OF THE BOARD. The business and affairs of the Fund are managed under the
direction of the Board. Like most closed-end investment companies, the
day-to-day responsibility for the management and operation of the Fund is the
responsibility of its various service providers, such as the Advisers and their
portfolio managers, and the Fund's co-administrators, custodian and transfer
agent. The Board has elected various senior individuals employed by certain of
these service providers as officers of the Fund, with responsibility to monitor
and report to the Board on the Fund's operations. In conducting its oversight,
the Board is provided regular reports from the various officers and service
providers regarding the Fund's operations. For example, the treasurer provides
reports as to financial reporting matters and portfolio managers report on the
performance of the Fund's portfolios. The Board has appointed a chief compliance
officer who administers the Fund's compliance program and regularly reports to
the Board as to compliance matters. Some of these reports are provided as part
of formal "Board Meetings" which typically are held quarterly, in person, and
involve the Board's review of recent Fund operations. From time to time, one or
more members of the Board may also meet with management in less formal settings,
between formal "Board Meetings", to discuss various topics. In all cases,
however, the role of the Board and of any individual Director is one of
oversight and not of management of the day-to-day affairs of the Fund.
BOARD LEADERSHIP STRUCTURE. The Board has determined that its leadership
structure is appropriate given the business and nature of the Fund. It has
established four standing committees, the Audit Committee and Nominating
Committee (each as described above) and a Pricing Committee and an Executive
Committee (defined below) (together, the "Committees"). Sixty percent of the
members of the Board are Independent Directors, which are Directors not
affiliated with the Advisers or their affiliates, and each Committee is
comprised entirely of Independent Directors. The Board has determined that the
Committees help ensure that the Fund has effective and independent governance
and oversight. The Board also believes that the Committees and leadership
structure facilitate the orderly and efficient flow of information to the
Independent Directors from management, including the Advisers. Where deemed
appropriate, from time to time, the Board may appoint ad hoc committees.
The Board's chairman is an Independent Director who acts as the primary liaison
between the Independent Directors and management (the "Independent Chairman").
The Independent Chairman plays an important role in setting the Board meeting
agendas and may help identify matters of special interest to be addressed by
management with the Board. The Independent Chairman also serves as chairman of
the Executive Committee, which is comprised of all of the Independent Directors
(the "Executive Committee"). The Executive Committee meets regularly, providing
a forum for the Independent Directors to meet in separate session, with or
without independent counsel, to deliberate on matters relevant to the Fund. The
Independent Directors have also engaged their own independent counsel to advise
them on matters relating to their responsibilities in connection with the Fund.
The Board reviews its structure annually. The Board has determined that the
structure of the Independent Chairman and the function and composition of the
Committees are appropriate means to address any potential conflicts of interest
that may arise.
BOARD OVERSIGHT OF RISK MANAGEMENT. As an integral part of its responsibility
for oversight of management of the Fund, the Board oversees risk management of
the Fund's investment programs and business affairs. The Board has emphasized to
management and the Advisers the importance of maintaining vigorous risk
management policies and procedures. Oversight of the risk management process is
part of the Board's general oversight of the Fund and its service providers. The
Board exercises oversight of the risk management process primarily through the
Audit Committee and Executive Committee, and through oversight by the Board
itself.
As part of its oversight function, the Board of Directors receives various
reports relating to risk management. The Fund faces a number of risks, such as
investment risk, counterparty risk, valuation risk, reputational risk, risk of
operational failure or lack of business continuity, and legal, compliance and
regulatory risks. The process of "risk management" seeks to identify and address
"risks", that is, events or circumstances that could have material adverse
effects on the business, operations, stockholder services, investment
performance or reputation of the Fund. Under the Board's overarching
supervision, the Fund, management, Advisers, FAS and other service providers to
the Fund employ a variety of processes, procedures and controls to identify
various risks, to lessen the probability of their occurrence and/or to mitigate
the effects of such events or circumstances if they do occur. Different
processes, procedures and controls are employed by different service providers
and with respect to different types of risks. Various personnel, including the
Fund's CCO as well as various personnel of the Advisers and other service
providers such as the Funds' independent accountants, make periodic reports to
the Board and appropriate Committees with respect to various aspects of risk
management, as well as events and circumstances that have arisen and responses
thereto. For example, the audit committee meets regularly with the CCO to
discuss compliance and operational risks and with the Fund's treasurer and
independent public accounting firm to discuss, among other things, the internal
control structure of the Fund's financial reporting function. In addition, the
full Board regularly receives reports from the Advisers and their portfolio
managers as to investment risks. The Board recognizes that not all risks that
may affect the Fund can be identified, that it may not be practical or
cost-effective to eliminate or mitigate certain risks, that it may be necessary
to bear certain risks (such as investment-related risks) to achieve the Fund's
goals, and that the processes, procedures and controls employed to address
certain risks may be limited in their effectiveness. Moreover, reports received
by the Directors as to risk management matters are typically summaries of the
relevant information. As a result of the foregoing and other factors, the
function of the Board with respect to risk management is one of oversight and
not of active involvement in, or coordination of, day-to-day risk management
activities for the Fund.
LEGAL PROCEEDINGS. None of the Directors or executive officers of the Fund have
been involved in any of the following events during the past ten years:
(o) Any bankruptcy petition filed by or against any business of which such
person was a general partner or executive officer either at the time
of the bankruptcy or within two years prior to that time;
(o) Any conviction in a criminal proceeding or being subject to a pending
criminal proceeding (excluding traffic violations and other minor
offenses);
(o) Any judicial or administrative proceedings resulting from involvement
in mail or wire fraud or fraud in connection with any business entity;
(o) Any judicial or administrative proceedings based on violations of
federal or state securities, commodities, banking or insurance laws
and regulation (including any settlement of such actions other than in
connection with a civil proceeding among private parties);
(o) Any disciplinary sanctions or orders imposed by a stock, commodities
or derivatives exchange or other self-regulatory organizations;
(o) Subject to any order, judgment, or decree, not subsequently reversed,
suspended or vacated, of any court of competent jurisdiction,
permanently or temporarily enjoining, barring, suspending or otherwise
limiting his involvement in any type of business, securities or
banking activities; or
(o) Found by a court of competent jurisdiction (in a civil action), the
SEC or the Commodity Futures Trading Commission to have violated a
federal or state securities or commodities law, and the judgment has
not been reversed, suspended, or vacated.
Vote Required. The election of Dr. Jacobson as a Director of the Fund will
require the affirmative vote of a plurality of the votes cast by holders of the
Common Stock and Preferred Stock, voting together as a single class, at the
Meeting in person or by proxy on Proposal 1. The election of Mr. Horejsi as a
Director of the Fund will require the affirmative vote of a plurality of the
votes cast by the holders of the Preferred 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 BOTH OF THE
NOMINEES.
PROPOSAL 2
STOCKHOLDER PROPOSAL TO AMEND BYLAWS
The following stockholder proposal has been submitted to the Fund for action at
the meeting by Larry Lattimore(1):
RESOLVED, Pursuant to Article XIII of the amended and restated bylaws
("Bylaws") of Boulder Growth & Income Fund, Inc. ("BIF"), the
stockholders of BIF hereby amend the Bylaws to add the following new
Article XIV:
"ARTICLE XIV VALUATION OF SECURITIES - If it shall be determined by a
federal or state court or regulatory authority that the Corporation,
in connection with its determination of net asset value as of any
fiscal quarter in 2008 or 2009, has overvalued an aggregate of no less
than $1,000,000 of the auction rate preferred securities it holds, by
a margin of greater than 5%, then the Board shall, subject to its
fiduciary duties, terminate the Corporation's investment advisory
agreement as soon as reasonably practicable."
Supporting Statement: Fellow stockholders, I have serious concerns with the
valuations BIF has been applying to the Auction Rate Preferred Securities
("ARPS") it holds, and believe these securities may have been significantly
over-valued by BIF. If BIF over-states the fair market value of the ARPS,
o Management fees are improperly inflated because these fees are based
on the value of assets under management;
o Reported performance is misleadingly inflated because the price
decline of these assets is not accurately reflected in performance
calculations.
BIF maintains a significant portion of its assets in ARPS. The market for ARPS
collapsed in early 2008, resulting in an extremely limited secondary market. By
BIF's own admission, it is unclear when, or if, the market for these securities
will return. A holder who needed to sell these securities would have been
required to sell them at a significant discount. By way of example, a closed-end
fund disclosed in its 2008 annual report that it had repurchased shares of its
ARPS at 65% of par in October 2008.
Despite this fundamental change in the market for ARPS in 2008 and 2009, BIF has
consistently valued these securities at or near face value, when, I believe, it
was widely known that their fair market valued were significantly less than face
value. ARPS have represented as much as 15% of BIF's assets. If these securities
were overvalued, then BIF's purported returns are materially overstated and BIF
has significantly overpaid management fees to BIF's investment adviser.
Following the February 2008 auction failures and consequent market collapse of
the ARPS market, BIF valued its ARPS as follows:
Date Principal Amount ($) Valuation
(% of Face Value)
February 29, 2008 $17,900,000 100%
May 31, 2008 $17,900,000 100%
August 31, 2008 $17,900,000 100%
November 30, 2008 $11,675,000 100%
February 28, 2009 $11,147,500 98%
May 31, 2009 $10,750,000 98%
August 31, 2009 $ 9,050,000 98%
During these periods, affiliates of BIF's investment advisor sold 138,800 BIF
common shares. The proposed amendment would require the Board to terminate the
investment advisory agreement, subject to its fiduciary duties, as soon as
reasonably practicable, if it is determined by a federal or state court or
regulatory body that BIF has overpriced the ARPS it holds, as described in the
amendment.
Please vote FOR this proposal.
MANAGEMENT'S STATEMENT IN OPPOSITION TO STOCKHOLDER PROPOSAL:
The Board of Directors unanimously recommends that stockholders vote AGAINST
Proposal 2.
-------------------------------------------
(1) Mr. Lattimore satisfied Rule 14a-8's requirement of being a record or
beneficial owner of Shares of common stock with a market value of at least
$2,000 and having held such Shares for at least one year at the time of his
submission of a stockholder proposal. Mr. Lattimore's address is 5602 Hardegan
Street, Indianapolis, IN 46227.
Here are the facts: During the 18-months cited by Mr. Lattimore above, the Fund
liquidated $8.85 million par value of its ARPS for $8.85 million through issuer
redemptions. That's 100 cents on every dollar. 100 percent of par value. 100
percent of what the Fund originally paid for the ARPS (not including the
dividends received while holding the ARPS). These redemptions liquidated
approximately 50% of the ARPS that the Fund held at the end of February 2008
when the ARPS market froze. Issuers of ARPS effected these redemptions for
various reasons, including partial and complete de-leveraging, as well as for
the purpose of securing replacement leverage. During this period, all closed-end
fund ARPS redemptions occurred at par (i.e., 100 cents on the dollar of face
value) and occurred at a frequency far surpassing secondary market transactions.
By the end of 2008, redemptions had become less frequent and a larger number of
reported secondary transactions occurred at below face value. In response to
these events, in January 2009 the Fund began valuing its ARPS at below face
value, while at the same time recognizing the high-quality and security of the
investment. The Board of Directors strongly believes that, at all times, the
valuations applied to the ARPS have been appropriate.
By way of background on the ARPS market, the Advisers are intimately familiar
with ARPS because the Fund is an issuer of ARPS. ARPS are issued by closed-end
funds as a means of leveraging. ARPS are perpetual preferred stocks which have
an auction feature, whereby dividend rates are determined in a Dutch Auction
process held periodically (e.g., every 7 or 28 days). The auction process
started failing in February, 2008, when undercapitalized broker-dealers (which
included Bear Stearns and Lehman Brothers, both of which no longer exist as
independent companies) stopped buying ARPS and simultaneously seemed to be
selling any inventory they had at the time. In addition, these broker-dealers
withheld this information on building illiquidity from buyers and sellers
(including the Fund).
The Advisers divide ARPS into two baskets. The first basket contains ARPS issued
by closed-end funds. The second basket contains ARPS issued by municipalities,
student loan companies, tax-exempt entities such as hospitals and museums, and
similar institutions. Virtually all closed-end funds have (or had) a AAA rating
on ARPS they issued. Many other issuers of ARPS have lower ratings, some of
which are sub-investment grade. Many of the ARPS in the second basket are in
trouble because they are collateralized with suspect assets (e.g., CDOs,
sub-prime loans and mortgages and other toxic assets). Many of these ARPS are
currently failing due to the deterioration of the underlying assets, have
defaulted or have been downgraded and thus are appropriately subject to
significant impairment. The Fund does not own any ARPS in the second basket. In
contrast, ARPS issued by closed-end funds are collateralized with diversified
assets at the 200% ratio mandated by the Act. In addition, the ARPS the Fund
holds continue to be rated AAA by at least one national rating agency. The AAA
rating requires issuers to maintain certain asset coverage ratios that are often
more onerous than the ratios required under the Act. All of the ARPS held by the
Fund are issued by closed-end funds, are AAA rated, continue to pay dividends at
the contractual rate (which presently is significantly greater than the yield on
U.S. Treasuries) and are backed by high-quality collateral at the minimum
coverage ratio of 200% and as required by the respective rating agencies. Under
the terms of the ARPS held by the Fund, if the asset coverage dips below the
200% minimum (or the ratio required by the rating agency), the issuer is
required to redeem a corresponding number of its ARPS at par so that the issuing
fund comes back into compliance. There is a big difference between the ARPS held
by the Fund and the faltering ARPS in the second basket.
Under the Act, the Fund must value its portfolio securities by using the market
value of the securities when market quotations for the securities are readily
available. When market quotations are not readily available (as is currently the
case with ARPS), the Act requires that the Fund's Board of Directors determine,
in good faith, the fair value of the securities. Accordingly, the Board has
implemented comprehensive policies and procedures for the Fund with respect to
valuing its "fair value securities" and has established a Pricing Committee to
oversee the valuation of the Fund's portfolio securities. The Board believes
that these policies and procedures conform with all applicable rules,
regulations and financial accounting standards with respect to the valuation of
securities, as well as industry best practices. The Board also believes that its
active oversight of the valuation of the Fund's portfolio securities effectively
mitigates the conflict of interest cited by Mr. Lattimore in his Proposal - that
the Advisers would seek to inflate the value of ARPS in order to increase fees
and overstate returns. Stockholders must recognize, however, that valuing
securities for which market quotations are not readily available (such as the
ARPS) requires consideration of the facts and circumstances of each particular
situation and involves the judgment of the members of the Board of Directors.
Given the subjective evaluations made by fund boards in valuing "fair value
securities", it is not uncommon for different funds to value the same security
at different prices.
The Board believes that the Proposal's arbitrary call for mandatory termination
of the Advisers based on a subjective valuation issue is an irrational
proposition that would ultimately hurt the Fund's stockholders should it ever be
implemented. As noted above, under the Act the valuation of fair value
securities is a matter that is reserved for the Board of Directors, and the
Board believes that it effectively oversees the valuation of the Fund's
portfolio securities and polices any related conflicts of interest. The Proposal
seeks to substitute the judgment of the Directors, who have been elected by the
stockholders to act in a manner they reasonably believe is in the best interest
of the Fund, with the judgment of judicial or regulatory authorities with
respect to the valuation of ARPS. Recognizing that the valuation of illiquid
securities is inherently subjective and that reasonable persons can reach
different valuation determinations on the identical facts, the Board is
concerned that adopting the Proposal could lead to frivolous litigation
challenging the valuation of the ARPS. This type of litigation may be initiated
by activist closed-end fund investors seeking to implement short-term strategies
that are detrimental to long-term stockholders, and any such litigation would
likely be costly for the Fund and a distraction to the Advisers. In addition,
the Board has serious questions regarding the legality or enforceability of the
Proposal.
If the Proposal is approved by stockholders, it is ambiguous as to how it should
be implemented or administered. The Proposal would amend the Fund's bylaws to
require the Board to terminate the Fund's investment advisory agreement upon the
occurrence of certain conditions relating to the valuation of its holdings. The
mandate is qualified entirely by the Board's duties to the Fund. Under Maryland
law, each Director, among other things, has the duty to act in a manner that he
or she reasonably believes is in the best interest of the Fund. So, in
accordance with the proposed bylaw's terms, the Board must terminate the
investment advisory agreement only if the Directors determine that termination
of the agreement is in the best interests of the Fund. It is unclear, then, what
the proposed bylaw requires that is different from compliance with the standard
of conduct already required of each member of the Board by Maryland law.
For the reasons stated above, the Fund reserves the right to challenge the
enforceability of the Proposal if it is approved by stockholders.
Vote Required. Approval of Proposal 2 requires the affirmative vote of a
majority of all the votes entitled to be cast on the matter.
THE BOARD OF DIRECTORS, INCLUDING ALL OF THE INDEPENDENT DIRECTORS, UNANIMOUSLY
RECOMMENDS THAT THE STOCKHOLDERS VOTE "AGAINST" 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 2011 annual meeting of
stockholders, the stockholder proposal must be received by the Fund not later
than _______, 2010. 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. Additionally,
approval of a stockholder proposal by the Fund's holders of Shares may still be
subject to review, including whether such proposal(s) is legal or comports with
general rules and regulations governing the operations of the Fund.
Pursuant to the Fund's bylaws, 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) proposed 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 received by the Secretary at 2344 Spruce Street, Suite A, Boulder,
Colorado 80302 by 5:00 P.M. Mountain Time, not earlier than the 150th day and
not later than the 120th day prior to the first anniversary of the date of
public release 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 received by the Secretary
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. Stockholders wishing to make proposals should refer to the Fund's bylaws
for proper procedures and notice content.
ADDITIONAL INFORMATION
INDEPENDENT ACCOUNTANTS. At its regularly scheduled Board meeting held on
November 2, 2009, the Audit Committee, consisting of those Directors who are not
"interested persons" (as defined in the Act), selected Deloitte & Touche LLP
("Deloitte") of Denver, Colorado, as the Fund's independent registered public
accounting firm for the Fund's fiscal year ending November 30, 2010. Deloitte
served as independent accountants for the Fund's fiscal years ended November 30,
2008 and November 30, 2009. 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 Deloitte for the Fund's fiscal
years ended November 30, 2008 and November 30, 2009.
Fiscal Year Ended Audit Fees Audit-Related Fees Tax Fees* All Other Fees+
--------------------- -------------------- -------------------- ------------------- --------------------
11/30/2008 $27,350 $0 $7,250 $5,000
11/30/2009 $27,000 $0 $7,250 $5,000
* "Tax Fees" are those fees billed to the Fund by Deloitte in connection with
tax consulting services, including primarily the review of the Fund's
income tax returns, excise tax returns and Maryland property tax returns.
+ This fee pertains to those fees billed to the Fund by Deloitte in
connection with their agreed-upon procedures reports under the terms of the
Preferred Stock.
The Audit Committee Charter requires that the Audit Committee pre-approve
all audit and non-audit services to be provided by the independent accountants
to the Fund, and all non-audit services to be provided by the independent
accountants to the Fund's investment adviser and any service providers
controlling, controlled by or under common control with the Funds' investment
adviser that provide on-going services to each Fund ("Affiliates"), 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 Deloitte billed the Fund fees for the
fiscal years ended November 30, 2008 and November 30, 2009 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, 2009,
Deloitte did not provide any non-audit services or bill any fees for such
services to the Fund's investment adviser or any Affiliates. For the twelve
months ended November 30, 2009, 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 independent
accountants' independence.
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE. Section 16(a) of
the 1934 Act and Section 30(h) of the Act require 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 received 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 will be counted
as shares that are present and entitled to vote on the matter for purposes of
determining the presence of a quorum. Abstentions and broker non-votes will have
no effect on the result of the vote in the election of directors in Proposal 1
and will have the effect of a vote against Proposal 2.
OTHER MATTERS TO COME BEFORE THE MEETING
The Fund does not intend to present any other business at the Meeting; however
this is subject to change based on developments at the Meeting.
--------------------------------------------------------------------------------
STOCKHOLDERS ARE REQUESTED TO COMPLETE, SIGN AND DATE THE ENCLOSED PROXY CARD OR
AUTHORIZE 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
--------------------------------------------------------------------------------
[GRAPHIC OMITTED]
BOULDER FUNDS
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 Nicole L. Murphey, or any of them, as proxies for the
undersigned, with full power of substitution in each of them, to attend the
Annual Meeting of Stockholders (the "Annual Meeting") to be held at
_________________, ___________________ at 9:00 a.m., _______ Daylight Time
(local time), on ________, 2010, 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" the Nominee for Director in
Proposal 1 and `AGAINST" Proposal 2. The votes entitled to be cast by the
undersigned will be cast in the discretion of the proxy holder on any other
matter that may properly come before the meeting. The undersigned hereby
acknowledges receipt of the Notice of Annual Meeting and Proxy Statement (the
terms of each of which are incorporated by reference herein). 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 under this Proxy. The undersigned
hereby revokes any proxy previously given with respect to the Meeting.
CONTINUED AND TO BE SIGNED ON REVERSE SIDE
Please indicate your vote by an "X" in the appropriate box below.
If this proxy is properly executed, the votes entitled to be cast by the
undersigned will be cast in the manner directed by the undersigned stockholder.
IF NO DIRECTION IS MADE, THE VOTES ENTITLED TO BE CAST BY THE UNDERSIGNED WILL
BE CAST "FOR" THE ELECTION OF THE NOMINEE FOR DIRECTOR IN PROPOSAL 1 AND
"AGAINST" PROPOSAL 2. ADDITIONALLY, THE VOTES ENTITLED TO BE CAST BY THE
UNDERSIGNED WILL BE CAST IN THE DISCRETION OF THE PROXY HOLDER ON ANY OTHER
MATTER THAT MAY PROPERLY COME BEFORE THE MEETING AND ANY ADJOURNMENTS OR
POSTPONEMENTS THEREOF.
Please refer to the Proxy Statement for a discussion of the Proposals.
------------ ----------------------------------------------------------- ----------- -------------------- ------------------------
1. Election of Directors: Nominee is Dr. Dean L. Jacobson. FOR____ WITHHOLD_____
------------ ----------------------------------------------------------- ----------- -------------------- ------------------------
THE BOARD OF DIRECTORS, INCLUDING ALL OF THE INDEPENDENT DIRECTORS, UNANIMOUSLY RECOMMENDS THAT THE STOCKHOLDERS VOTE "FOR"
ELECTION OF THE NOMINEE.
------------ ----------------------------------------------------------- ----------- -------------------- ------------------------
To approve an amendment to the bylaws regarding termination FOR____ AGAINST___ ABSTAIN ___
2. of the advisers.
------------ ----------------------------------------------------------- ----------- -------------------- ------------------------
THE BOARD OF DIRECTORS, INCLUDING ALL OF THE INDEPENDENT DIRECTORS, UNANIMOUSLY RECOMMENDS THAT THE STOCKHOLDERS VOTE "AGAINST"
THIS PROPOSAL, AS MORE FULLY DESCRIBED IN THE PROXY STATEMENT
----------------------------------------------------------------------------------------------------------------------------------
CHECK HERE ONLY IF YOU PLAN TO ATTEND THE MEETING IN PERSON. _____
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 Taxable 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 Nicole L.
Murphey, or any of them as proxies for the undersigned, with full power of
substitution in each of them, to attend the Annual Meeting of Stockholders (the
"Annual Meeting") to be held at ___________________, ________________ at 9:00
a.m.. ________ Daylight Time (local time), on _____, 2010, 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 in Proposal 1 and `AGAINST"
Proposal 2. The votes entitled to be cast by the undersigned will be cast in the
discretion of the proxy holder on any other matter that may properly come before
the meeting. The undersigned hereby acknowledges receipt of the Notice of Annual
Meeting and Proxy Statement (the terms of each of which are incorporated by
reference herein). 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 under this Proxy. The undersigned hereby revokes any proxy previously
given with respect to the Meeting..
CONTINUED AND TO BE SIGNED ON REVERSE SIDE
Please indicate your vote by an "X" in the appropriate box below.
If this proxy is properly executed, the votes entitled to be cast by the
undersigned will be cast in the manner directed by the undersigned stockholder.
IF NO DIRECTION IS MADE, THE VOTES ENTITLED TO BE CAST BY THE UNDERSIGNED WILL
BE CAST "FOR" EACH OF THE NOMINEES FOR DIRECTOR IN PROPOSAL 1 AND "AGAINST"
PROPOSAL 2. ADDITIONALLY, THE VOTES ENTITLED TO BE CAST BY THE UNDERSIGNED WILL
BE CAST IN THE DISCRETION OF THE PROXY HOLDER ON ANY OTHER MATTER THAT MAY
PROPERLY COME BEFORE THE MEETING AND ANY ADJOURNMENTS OR POSTPONEMENTS THEREOF.
Please refer to the Proxy Statement for a discussion of the Proposals.
------------ ----------------------------------------------------------- ----------- -------------------- ------------------------
1. Election of Directors: Nominees are Dr. Dean L. FOR____ WITHHOLD_____ FOR ALL EXCEPT ____
Jacobson and John S. Horejsi
------------ ----------------------------------------------------------- ----------- -------------------- ------------------------
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, INCLUDING ALL OF THE INDEPENDENT DIRECTORS, UNANIMOUSLY RECOMMENDS THAT THE STOCKHOLDERS VOTE "FOR"
ELECTION OF ALL THE NOMINEES.
------------ ----------------------------------------------------------- ----------- -------------------- ------------------------
To approve an amendment to the bylaws regarding termination FOR____ AGAINST ____ ABSTAIN ___
2. of the advisers
------------ ----------------------------------------------------------- ----------- -------------------- ------------------------
THE BOARD OF DIRECTORS, INCLUDING ALL OF THE INDEPENDENT DIRECTORS, UNANIMOUSLY RECOMMENDS THAT THE STOCKHOLDERS VOTE "AGAINST"
ELECTION OF THIS PROPOSAL, AS MORE FULLY DESCRIBED IN THE PROXY STATEMENT.
----------------------------------------------------------------------------------------------------------------------------------
CHECK HERE ONLY IF YOU PLAN TO ATTEND THE MEETING IN PERSON. ____
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:
-------------------------