<PAGE>
File No. 2-80168
811-3596
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM N-1A
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 [_]
Pre-Effective Amendment No. __ [_]
Post-Effective Amendment No. 16 [x]
--
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 [_]
Amendment No. 16 [x]
--
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SELIGMAN COMMUNICATIONS AND INFORMATION FUND, INC.
(Exact name of registrant as specified in charter)
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100 PARK AVENUE, NEW YORK, NEW YORK 10017
(Address of principal executive offices)
Registrant's Telephone Number: 212-850-1864 or Toll Free: 800-221-2450
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THOMAS G. ROSE, Treasurer, 100 Park Avenue, New York, New York 10017
(Name and address of agent for service)
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It is proposed that this filing will become effective (check appropriate
box):
[_] immediately upon filing pursuant [_] on (date) pursuant to paragraph
to paragraph (b) of rule 485 (a)(i) of rule 485
[x] on May 1, 1995 pursuant to [_] 75 days after filing pursuant
paragraph (b) of rule 485 to paragraph (a)(ii) of rule
485
[_] 60 days after filing pursuant to [_] on (date) pursuant to paragraph
paragraph (a)(i) of rule 485 (a)(ii) of rule 485.
If appropriate, check the following box:
[_] This post-effective amendment designates a new effective date for a
previously filed post-effective amendment.
Registrant has registered an indefinite amount of securities under the
Securities Act of 1933 pursuant to Rule 24f-2(a)(1) and a Rule 24f-2 Notice for
Registrant's most recent fiscal year will be filed with the Commission on
February 27, 1995.
<PAGE>
File No. 2-80168
811-3596
SELIGMAN COMMUNICATIONS AND INFORMATION FUND, INC.
FORM N-1A CROSS REFERENCE SHEET
POST-EFFECTIVE AMENDMENT NO. 16
Pursuant to Rule 481(a)
-----------------------
<TABLE>
<CAPTION>
Item in Part A of Form N-1A Location in Prospectus
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<C> <S> <C>
1. Cover Page Cover Page
2. Synopsis Summary of Fund Expenses
3. Condensed Financial Information Financial Highlights
4. General Description of Registrant Cover Page; Organization and
Capitalization
5. Management of the Fund Management Services
5a. Manager's Discussion of Fund Performance Management Services
6. Capital Stock and Other Securities Organization and
Capitalization
7. Purchase of Securities Being Offered Alternative Distribution
System; Purchase of Shares;
Administration, Shareholder
Services and Distribution Plan
8. Redemption or Repurchase Telephone Transactions;
Redemption of Shares; Exchange
Privilege
9. Pending Legal Proceedings Not Applicable
<CAPTION>
Item in Part B of Form N-1A Location in Statement of Additional Information
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<C> <S> <C>
10. Cover Page Cover Page
11. Table of Contents Table of Contents
12. General Information and History General Information;
Organization and
Capitalization (Prospectus);
Appendix
13. Investment Objectives and Policies Investment Objectives,
Policies And Risks; Investment
Limitations
14. Management of the Registrant Management And Expenses
15. Control Persons and Principal Directors and Officers Holders
of Securities
16. Investment Advisory and Other Services Management and Expenses;
Distribution Services
17. Brokerage Allocation Portfolio Transactions;
Administration, Shareholder
Services and Distribution Plan
18. Capital Stock and Other Securities General Information;
Organization and
Capitalization (Prospectus)
19. Purchase, Redemption and Pricing Purchase and Redemption of
Fund Shares; Valuation of
Securities being offered
20. Tax Status Federal Income Taxes
(Prospectus)
21. Underwriters Distribution Services
22. Calculation of Performance Data Performance
23. Financial Statements Financial Statements
</TABLE>
<PAGE>
SELIGMAN COMMUNICATIONS AND INFORMATION FUND, INC.
100 Park Avenue
New York N. Y. 10017
New York City Telephone: (212) 850-1864
Toll-Free Telephone: (800) 221-2450 all continental United States
For Retirement Plan Information -- Toll-Free Telephone: (800) 445-1777
May 1, 1995
Seligman Communications and Information Fund, Inc. (the "Fund") is a mutual
fund which invests to produce capital gain. The Fund invests primarily in se-
curities of companies in the communications, information and related indus-
tries. Investment advisory and management services are provided to the Fund by
J. & W. Seligman & Co. Incorporated (the "Manager"); the Fund's distributor is
Seligman Financial Services, Inc., an affiliate of the Manager. For a descrip-
tion of the Fund's investment objective and policies, including the risk fac-
tors associated with an investment in the Fund, see "Investment Objective,
Policies And Risks." There can be no assurance that the Fund's investment ob-
jective will be achieved.
The Fund offers two classes of shares. Class A shares are sold subject to an
initial sales load of up to 4.75% and an annual service fee currently charged
at a rate of up to .25 of 1% of the average daily net asset value of the Class
A shares. Class D shares are sold without an initial sales load but are sub-
ject to a contingent deferred sales load ("CDSL") of 1% imposed on certain re-
demptions within one year of purchase, an annual distribution fee of up to .75
of 1% and an annual service fee of up to .25 of 1% of the average daily net
asset value of the Class D shares. See "Alternative Distribution System."
Shares of the Fund may be purchased through any authorized investment dealer.
The Fund will be closed to new investors after June 30, 1995. For more infor-
mation, see "Purchase Of Shares."
This Prospectus sets forth concisely the information a prospective investor
should know about the Fund before investing. Please read it carefully before
you invest and keep it for future reference. Additional information about the
Fund, including a Statement of Additional Information, has been filed with the
Securities and Exchange Commission. The Statement of Additional Information is
available upon request and without charge by calling or writing the Fund at
the telephone numbers or the address set forth above. The Statement of Addi-
tional Information is dated the same date as this Prospectus and is incorpo-
rated herein by reference in its entirety.
SHARES IN THE FUND ARE NOT DEPOSITS OR OBLIGATIONS OF, OR GUARANTEED OR ENDORSED
BY, ANY BANK, AND SHARES ARE NOT FEDERALLY INSURED BY THE FEDERAL DEPOSIT
INSURANCE CORPORATION, THE FEDERAL RESERVE BOARD OR ANY OTHER AGENCY.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
<S> <C>
Summary Of Fund Expenses.............................................. 2
Financial Highlights.................................................. 3
Alternative Distribution System....................................... 4
Investment Objective, Policies And Risks.............................. 5
Management Services................................................... 7
Purchase Of Shares.................................................... 9
Telephone Transactions................................................ 14
Redemption Of Shares.................................................. 14
<CAPTION>
PAGE
<S> <C>
Administration, Shareholder Services And Distribution Plan............ 16
Exchange Privilege.................................................... 17
Further Information About Transactions In The Fund.................... 19
Dividends And Distributions........................................... 19
Federal Income Taxes.................................................. 20
Shareholder Information............................................... 21
Advertising The Fund's Performance.................................... 23
Organization And Capitalization....................................... 23
</TABLE>
<PAGE>
SUMMARY OF FUND EXPENSES
<TABLE>
<CAPTION>
CLASS A CLASS D
SHARES SHARES
-------------- ---------------
(INITIAL SALES (DEFERRED SALES
LOAD LOAD
ALTERNATIVE) ALTERNATIVE)
<S> <C> <C>
SHAREHOLDER TRANSACTION EXPENSES
Maximum Sales Load Imposed on
Purchases
(as a percentage of offering
price).............................. 4.75% None
Sales Load on Reinvested Dividends... None None
Deferred Sales Load (as a percentage
of original purchase price or 1% during the
redemption proceeds, whichever is first year;
lower).............................. None None thereafter
Redemption Fees...................... None None
Exchange Fees........................ None None
<CAPTION>
CLASS A CLASS D
------- -------
<S> <C> <C>
ANNUAL FUND OPERATING EXPENSES FOR 1994
(as a percentage of average net assets)
Management Fees...................... .75% .75%
12b-1 Fees........................... .21% 1.00%*
Other Expenses....................... .69% .75%
----- -----
Total Fund Operating Expenses........ 1.65% 2.50%
===== =====
</TABLE>
The purpose of this table is to assist investors in understanding the vari-
ous costs and expenses which shareholders of the Fund bear directly or indi-
rectly. The sales load on Class A shares is a one-time charge paid at the time
of purchase of shares. Reductions in sales loads are available in certain cir-
cumstances. The contingent deferred sales load on Class D shares is a one-time
charge paid only if shares are redeemed within one year of purchase. For more
information concerning reduction in sales loads and for a more complete de-
scription of the various costs and expenses, see "Purchase Of Shares," "Re-
demption Of Shares" and "Management Services" herein. The Fund's Administra-
tion, Shareholder Services and Distribution Plan to which the caption "12b-1
Fees" relates, is discussed under "Administration, Shareholder Services and
Distribution Plan" herein.
<TABLE>
<CAPTION>
1 YEAR 3 YEARS 5 YEARS 10 YEARS
EXAMPLE ------ ------- ------- --------
<S> <C> <C> <C> <C>
You would pay the following expenses on a
$1,000 investment, assuming (1) 5% annual re-
turn and (2) redemption at the end of each
time period............................Class A $63 $97 $133 $234
Class D $35+ $78 $133 $284
</TABLE>
THE EXAMPLE SHOULD NOT BE CONSIDERED A REPRESENTATION OF PAST OR FUTURE EX-
PENSES. ACTUAL EXPENSES MAY BE GREATER OR LESS THAN THOSE SHOWN AND THE 5% AN-
NUAL RETURN USED IN THIS EXAMPLE IS A HYPOTHETICAL RATE.
* Includes an annual distribution fee of .75 of 1% and an annual service fee
of .25 of 1%. Pursuant to the Rules of the National Association of Securi-
ties Dealers, Inc., the aggregate deferred sales loads and annual distribu-
tion fees on Class D shares of the Fund may not exceed 6.25% of total gross
sales, subject to certain exclusions. The 6.25% limitation is imposed on the
Fund rather than on a per shareholder basis. Therefore, a long-term Class D
shareholder of the Fund may pay more in total sales loads (including distri-
bution fees) than the economic equivalent of 6.25% of such shareholder's in-
vestment in the shares.
+ Assuming (1) 5% annual return and (2) no redemption at the end of one year,
the expenses on a $1,000 investment would be $25.
2
<PAGE>
FINANCIAL HIGHLIGHTS
The Fund's financial highlights for the periods presented below have been
audited by Deloitte & Touche LLP, independent auditors. This information,
which is derived from the financial and accounting records of the Fund, should
be read in conjunction with the 1994 financial statements and notes contained
in the 1994 Annual Report, which may be obtained by calling or writing the
Fund at the telephone numbers or address provided on the cover page of this
Prospectus.
The per share operating performance data is designed to allow investors to
trace the operating performance, on a per share basis, from the Fund's begin-
ning net asset value to its ending net asset value so that investors may un-
derstand what effect the individual items have on their investment, assuming
it was held throughout the period. Generally, the per share amounts are de-
rived by converting the actual dollar amounts incurred for each item, as dis-
closed in the financial statements, to their equivalent per share amount.
The total return based on net asset value measures the Fund's performance
assuming investors purchased Fund shares at net asset value as of the begin-
ning of the period, invested dividends and capital gains paid at net asset
value and then sold their shares at the net asset value per share on the last
day of the period. The total return computations do not reflect any sales
loads investors may incur in purchasing or selling shares of the Fund. Total
returns for periods of less than one year are not annualized.
<TABLE>
<CAPTION>
CLASS A
--------------------------------------------------------------------------------------------
YEAR ENDED DECEMBER 31
--------------------------------------------------------------------------------------------
19940 1993 1992 1991 1990 1989 1988 1987 1986 1985
-------- ------- ------- ------- ------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
PER SHARE OPERATING
PERFORMANCE:
Net asset value,
beginning of
period.......... $13.43 $12.30 $11.57 $ 8.87 $10.11 $10.07 $10.19 $11.39 $10.06 $ 7.57
-------- ------- ------- ------- ------- ------- ------- ------- ------- -------
Net investment
income (loss)... (.19) (.14) (.12) (.12) (.08) (.05) .01 (.04) .03 --
Net realized and
unrealized
investment gain
(loss).......... 4.86 4.37 2.09 4.87 (1.04) 3.00 .72 1.67 1.65 2.57
-------- ------- ------- ------- ------- ------- ------- ------- ------- -------
Increase
(decrease) from
investment
operations...... 4.67 4.23 1.97 4.75 (1.12) 2.95 .73 1.63 1.68 2.57
Dividends paid.. -- -- -- -- -- -- -- -- -- (.08)
Distributions
from net gain
realized........ (1.46) (3.10) (1.24) (2.05) (.12) (2.91) (.85) (2.83) (.35) --
-------- ------- ------- ------- ------- ------- ------- ------- ------- -------
Net increase
(decrease) in
net asset value. 3.21 1.13 .73 2.70 (1.24) .04 (.12) (1.20) 1.33 2.49
-------- ------- ------- ------- ------- ------- ------- ------- ------- -------
Net asset value,
end of period... $16.64 $13.43 $12.30 $11.57 $ 8.87 $10.11 $10.07 $10.19 $11.39 $10.06
======== ======= ======= ======= ======= ======= ======= ======= ======= =======
Total return
based on net
asset value..... 35.30% 35.13% 17.31% 54.91% (11.07)% 30.12% 7.33% 15.01% 16.64% 34.19%
RATIOS/SUPPLEMENTAL DATA:
Expenses to
average net
assets++........ 1.65% 1.63% 1.51% 1.69% 1.67% 1.48% 1.60% 1.70% 1.68% 1.39%
Net investment
income (loss) to
average net
assets++........ (1.27)% (1.39)% (1.18)% (1.23)% (.83)% (.44)% .11% (.22)% .27% .03%
Portfolio
turnover........ 104.08% 137.10% 110.42% 107.72% 85.56% 123.16% 116.86% 87.08% 58.63% 56.85%
Net assets, end
of period (000's
omitted)........ $307,542 $92,987 $57,001 $50,175 $35,292 $42,200 $38,675 $42,583 $40,351 $48,331
<CAPTION>
CLASS D
----------------------
YEAR 5/3/93*
ENDED TO
12/31/940 12/31/93
---------- -----------
<S> <C> <C> <C>
PER SHARE OPERATING
PERFORMANCE:
Net asset value,
beginning of
period.......... $13.32 $12.24
---------- -----------
Net investment
income (loss)... (.33) (.05)
Net realized and
unrealized
investment gain
(loss).......... 4.78 4.23
---------- -----------
Increase
(decrease) from
investment
operations...... 4.45 4.18
Dividends paid.. -- --
Distributions
from net gain
realized........ (1.46) (3.10)
---------- -----------
Net increase
(decrease) in
net asset value. 2.99 1.08
---------- -----------
Net asset value,
end of period... $16.31 $13.32
========== ===========
Total return
based on net
asset value..... 33.94% 34.89%
RATIOS/SUPPLEMENTAL DATA:
Expenses to
average net
assets++........ 2.50% 2.56%**
Net investment
income (loss) to
average net
assets++........ (2.20)% (2.33)%**
Portfolio
turnover........ 104.08% 137.10%+
Net assets, end
of period (000's
omitted)........ $96,100 $7,833
</TABLE>
- -------
0 Per share amounts for the year ended December 31, 1994, are calculated
based on average shares outstanding.
* Commencement of offering of Class D shares.
** Annualized.
+ For the year ended December 31, 1993.
++ Excludes interest expense of $3,051 in 1988.
The data provided above reflects historical information and therefore through
December 31, 1992 has not been adjusted to reflect the effect of the Adminis-
tration, Shareholder Services and Distribution Plan which was approved on No-
vember 23, 1992 and effective January 1, 1993.
3
<PAGE>
ALTERNATIVE DISTRIBUTION SYSTEM
The Fund offers two classes of shares. Class A shares are sold to investors
who have concluded that they would prefer to pay an initial sales load and have
the benefit of lower continuing charges. Class D shares are sold to investors
choosing to pay no initial sales load, a higher distribution fee and with, re-
spect to redemptions within one year of purchase, a CDSL. The Alternative Dis-
tribution System allows investors to choose the method of purchasing shares
that is most beneficial in light of the amount of the purchase, the length of
time the shares are expected to be held and other relevant circumstances. In-
vestors should determine whether under their particular circumstances it is
more advantageous to incur an initial sales load and be subject to lower ongo-
ing charges, as discussed below, or to have the entire initial purchase price
invested in the Fund with the investment thereafter being subject to higher on-
going charges and, for a one-year period, a CDSL.
Investors who qualify for reduced sales loads, as described under "Purchase
Of Shares" below might choose to purchase Class A shares because Class A shares
would be subject to lower ongoing fees. The amount invested in the Fund, howev-
er, is reduced by the initial sales loads deducted at the time of purchase.
Investors who do not qualify for reduced initial sales loads but expect to
maintain their investment for an extended period of time might also choose to
purchase Class A shares because over time the accumulated continuing distribu-
tion fee of Class D shares may exceed the initial sales load and lower distri-
bution fee of Class A shares. This consideration must be weighed against the
fact that the amount invested in the Fund will be reduced by the initial sales
load deducted at the time of purchase. Furthermore, the distribution fees will
be offset to the extent any return is realized on the additional funds ini-
tially invested under the Class D alternative.
Alternatively, some investors might choose to have all of their funds in-
vested initially in Class D shares although remaining subject to a higher con-
tinuing distribution fee and, for a one-year period, a CDSL as described below.
For example, an investor who does not qualify for reduced sales loads would
have to hold Class A shares for more than 6.33 years for the Class D distribu-
tion fee to exceed the initial sales load plus the distribution fee on Class A
shares. This example does not take into account the time value of money, which
further reduces the impact of the Class D shares' 1% distribution fee, other
expenses charged to each class, fluctuations in net asset value or the effect
of the return on the investment over this period of time.
The two classes of shares represent interests in the same portfolio of in-
vestments, have the same rights and are generally identical in all respects ex-
cept that each class bears its separate distribution and certain class expenses
and has exclusive voting rights with respect to any matter to which a separate
vote of any class is required by the Investment Company Act of 1940, as amended
(the "1940 Act") or Maryland law. The net income attributable to each class and
dividends payable on the shares of each class will be reduced by the amount of
distribution and other expenses of each class. Class D shares bear higher dis-
tribution fees, which will cause the Class D shares to pay lower dividends than
the Class A shares. The two classes also have separate exchange privileges.
The Directors of the Fund believe that no conflict of interest currently ex-
ists between the Class A and Class D shares. On an ongoing basis, the Direc-
tors, in the exercise of their fiduciary duties under the 1940 Act, and Mary-
land law, will seek to ensure that no such conflict arises. For this purpose,
the Directors will monitor the Fund for the existence of any material conflict
among the classes and will take such action as is reasonably necessary to elim-
inate any such conflicts that may develop.
DIFFERENCES BETWEEN CLASSES. The primary distinctions between Class A and
Class D shares are
4
<PAGE>
their sales load structures and ongoing expenses as set forth below. Each class
has advantages and disadvantages for different investors, and investors should
choose the class that best suits their circumstances and their objectives.
<TABLE>
<CAPTION>
ANNUAL 12B-1 FEES
INITIAL (AS A % OF AVERAGE
SALES LOAD DAILY NET ASSETS) OTHER INFORMATION
---------- ------------------ ------------------
<S> <C> <C> <C>
CLASS A Maximum initial Service fee of Initial sales load
sales load of .25%. waived or
4.75% of the reduced for
public offering certain
price. purchases.
CLASS D None Service fee of CDSL
.25%; of 1% on
Distribution fee redemptions
of .75%. within one year
of purchase.
</TABLE>
INVESTMENT OBJECTIVE, POLICIES AND RISKS
The Fund is an open-end diversified management investment company, as defined
in the 1940 Act, or mutual fund, incorporated in Maryland in 1982.
The Fund invests to produce capital gain. Income is not an objective.
Investing for capital gain ordinarily exposes capital to added risk. Shares
of the Fund are intended for you only if you are able and willing to take such
risk. There can be no assurance that the Fund's investment objectives will be
attained.
The Fund seeks to achieve its objective by investing in a portfolio consist-
ing of securities of companies operating in virtually all aspects of the commu-
nications, information and related industries. It invests at least 80% of its
net assets, exclusive of government securities, short-term notes, cash and cash
equivalents, in securities of companies engaged in these industries.
The communication and use of information using existing and developing tech-
nologies is increasingly permeating global civilization. Consequently, there
are opportunities for continued growth in demand for components, products, me-
dia and systems to collect, store, retrieve, transmit, process, distribute,
record, reproduce and put information to use. The pervasive impact of communi-
cations and information upon society is being accelerated by the blending of
computers with telecommunications systems, with resulting lower costs and
higher efficiencies. Accordingly, companies engaged in the production of meth-
ods for using electronic technology to communicate information are important in
the Fund's portfolio. However, older technologies such as photography and print
may also be represented. Companies that successfully converge technologies--
medical databases and computer networks for example--are sought for the portfo-
lio.
The value of Fund shares may be susceptible to factors affecting the communi-
cations, information and related industries. These industries may be subject to
greater governmental regulation than many other industries and changes in gov-
ernmental policies and the need for regulatory approvals may have a material
effect on the products and services of these industries.
Although securities of large companies that now are well established in the
world communications and information market and can be expected to grow with
the market are held in the Fund's portfolio, rapidly changing technologies and
the expansion of the communications, information and related industries provide
a favorable environment for investing in companies of small to medium size. Se-
curities of smaller, less seasoned companies may be subject to greater price
fluctuation, limited liquidity and above-average investment risk.
The Fund invests primarily in common stocks. It also may invest in securities
convertible into or exchangeable for common stocks, in rights and warrants to
purchase common stocks and in debt securities or preferred stocks believed to
provide opportunities for capital gain.
5
<PAGE>
It is the Fund's present intention to invest not more than 5% of its net as-
sets in debt securities which are not rated within the four highest rating cat-
egories by Standard & Poor's Corporation or by Moody's Investors Service, Inc.
Securities owned are kept under continuing supervision, and changes may be
made whenever such securities no longer seem to meet the Fund's capital gain
objectives. Neither the length of time a security has been held nor the rate of
turnover of the Fund's portfolio is considered a limiting factor on changes.
Portfolio turnover may vary with such changes.
BORROWING. The Fund may from time to time borrow money to increase its port-
folio of securities. It may borrow only from banks and may not borrow in excess
of one-third of the market value of its assets, less liabilities other than
such borrowing, or pledge more than 10% of its total assets, taken at cost, to
secure the borrowing. These limits may be changed only by a vote of the share-
holders. Current asset value coverage of three times any amount borrowed is re-
quired at all times.
Borrowed money creates an opportunity for greater capital appreciation, but
at the same time increases exposure to capital risk. The net cost of any money
borrowed would be an expense that otherwise would not be incurred, and this ex-
pense could limit the Fund's net investment income in any given period.
LENDING OF PORTFOLIO SECURITIES. The Fund may lend portfolio securities to
brokers or dealers, banks or other institutional borrowers of securities. The
borrower must maintain with the Fund cash or equivalent collateral equal to at
least 100% of the market value of the securities loaned. During the time port-
folio securities are on loan, the borrower pays the Fund an amount equivalent
to any dividends or interest paid on the securities and the Fund may invest the
cash collateral and earn additional income or may receive an agreed upon amount
of interest income from the borrower.
RESTRICTED SECURITIES. The Fund may invest up to 15% of its net assets in il-
liquid securities, including restricted securities (i.e., securities not read-
ily marketable without registration under the Securities Act of 1933 (the "1933
Act")) and other securities that are not readily marketable. The Fund may pur-
chase restricted securities that can be offered and sold to "qualified institu-
tional buyers" under Rule 144A of the 1933 Act, and the Fund's Board of Direc-
tors may determine, when appropriate, that specific Rule 144A securities are
liquid and not subject to the 15% limitation on illiquid securities. Should the
Board of Directors make this determination, it will carefully monitor the secu-
rity (focusing on such factors, among others, as trading activity and avail-
ability of information) to determine that the Rule 144A security continues to
be liquid. It is not possible to predict with assurance exactly how the market
for restricted securities offered and sold under Rule 144A will develop. This
investment practice could have the effect of increasing the level of illiquid-
ity in the Fund to the extent that qualified institutional buyers become for a
time uninterested in purchasing Rule 144A securities.
FOREIGN SECURITIES. The Fund may invest in commercial paper and certificates
of deposit issued by foreign banks and may invest in other securities of for-
eign issuers directly or through American Depository Receipts ("ADRs"), Euro-
pean Depository Receipts ("EDRs") or Global Depository Receipts ("GDRs") (col-
lectively, "Depository Receipts"). Foreign investments may be affected favor-
ably or unfavorably by changes in currency rates and exchange control regula-
tions. There may be less information available about a foreign company than
about a U.S. company and foreign companies may not be subject to reporting
standards and requirements comparable to those applicable to U.S. companies.
Foreign securities may not be as liquid as U.S. securities. Securities of for-
eign companies may involve greater market risk than securities of U.S. compa-
nies, and foreign brokerage commissions and custody fees are generally higher
than in the United States. Investments in foreign securities may also be sub-
ject to local economic or political risks, political instability and possible
nationalization of issuers. Depository Receipts are instruments generally is-
sued by domestic banks or trust compa
6
<PAGE>
nies that represent the deposits of a security of a foreign issuer. ADRs may be
publicly traded on exchanges or over-the-counter in the United States and are
quoted and settled in dollars at a price that generally reflects the dollar
equivalent of the home country share price. EDRs and GDRs are typically traded
in Europe and in both Europe and the United States, respectively. Depository
Receipts may be issued under sponsored or unsponsored programs. In sponsored
programs, the issuer has made arrangements to have its securities traded in the
form of a Depository Receipt. In unsponsored programs, the issuers may not be
directly involved in the creation of the program. Although regulatory require-
ments with respect to sponsored and unsponsored Depository Receipt programs are
generally similar, the issuers of securities represented by unsponsored Deposi-
tory Receipts are not obligated to disclose material information in the United
States, and therefore, the import of such information may not be reflected in
the market value of such receipts. The Fund may invest up to 10% of its total
assets in foreign securities that it holds directly, but this 10% limit does
not apply to foreign securities held through Depository Receipts which are
traded in the United States or to commercial paper and certificates of deposit
issued by foreign banks.
Except as noted above, the foregoing investment policies are not fundamental
and the Board of Directors of the Fund may change such policies without the
vote of a majority of its outstanding voting securities. As a matter of policy,
the Board would not change the Fund's investment objective of seeking to pro-
duce capital gain without such a vote. A more detailed description of the
Fund's investment policies, including a list of those restrictions on the
Fund's investment activities which cannot be changed without such a vote, ap-
pears in the Statement of Additional Information. Under the 1940 Act, a "vote
of a majority of the outstanding voting securities" of the Fund means the af-
firmative vote of the lesser of (1) more than 50% of the outstanding shares of
the Fund or (2) 67% or more of the shares present at a shareholders' meeting if
more than 50% of the outstanding shares are represented at the meeting in per-
son or by proxy.
MANAGEMENT SERVICES
THE MANAGER. The Board of Directors provides broad supervision over the af-
fairs of the Fund. Pursuant to a Management Agreement approved by the Board and
the shareholders of the Fund, the Manager manages the investments of the Fund
and administers the business and other affairs of the Fund. The address of the
Manager is 100 Park Avenue, New York, NY 10017.
The Manager also serves as manager of sixteen other investment companies
which, together with the Fund, comprise the "Seligman Group." These companies
are: Seligman Capital Fund, Inc., Seligman Cash Management Fund, Inc., Seligman
Common Stock Fund, Inc., Seligman Frontier Fund, Inc., Seligman Growth Fund,
Inc., Seligman Henderson Global Fund Series, Inc., Seligman High Income Fund
Series, Seligman Income Fund, Inc., Seligman New Jersey Tax-Exempt Fund, Inc.,
Seligman Pennsylvania Tax- Exempt Fund Series, Seligman Portfolios, Inc., Se-
ligman Quality Municipal Fund, Inc., Seligman Select Municipal Fund, Inc., Se-
ligman Tax-Exempt Fund Series, Inc., Seligman Tax-Exempt Series Trust and Tri-
Continental Corporation. The aggregate assets of the Seligman Group are approx-
imately $7.3 billion. The Manager also provides investment management or advice
to institutional accounts having an aggregate value of approximately $3.3 bil-
lion.
Mr. William C. Morris is Chairman and President of the Manager and Chairman
of the Board and Chief Executive Officer of the Fund. Mr. Morris owns a
majority of the outstanding voting securities of the Manager.
The Manager provides senior management for Seligman Data Corp., a wholly-
owned subsidiary of certain other investment companies in the Seligman Group,
which performs, at cost, certain recordkeeping functions for the Fund, main-
tains the records of shareholder accounts and furnishes dividend paying, re-
demption and related services.
The Manager is entitled to receive a management fee, calculated daily and
payable monthly, equal to 0.75% of the daily net assets of the Fund.
7
<PAGE>
The Fund pays all its expenses other than those assumed by the Manager. Total
expenses of the Fund's Class A and Class D shares, respectively, for the year
ended December 31, 1994 amounted to 1.65% and 2.50%, respectively, of the aver-
age daily net assets of each class.
THE SUBADVISER. On May 19, 1994, shareholders of the Fund approved a
Subadvisory Agreement between the Manager and Seligman Henderson Co. (the
"Subadviser") that provides that the Subadviser shall act as Subadviser to the
Fund with respect to a portion of the Fund's assets as designated by the Manag-
er, which shall include all or a portion of the Fund's foreign investments
("Qualifying Assets"). The Fund has a non-fundamental policy under which it may
invest up to 10% of its total assets in foreign securities that are held di-
rectly. The 10% limit does not apply to foreign securities held through Deposi-
tory Receipts which are traded in the United States or to commercial paper and
certificates of deposit issued by foreign banks. The Subadviser serves the
Fund pursuant to a Subadvisory Agreement with the Manager (the "Subadvisory
Agreement"), dated June 1, 1994. The Subadvisory Agreement provides that the
Subadviser provides investment management services with respect to the Qualify-
ing Assets, including investment research, advice and supervision, determines
which securities will be purchased or sold, makes purchases and sales on behalf
of the Fund and determines how voting and other rights with respect to securi-
ties held by the Fund shall be exercised, subject in each case to the control
of the Board of Directors and in accordance with the Fund's investment objec-
tives, policies and principles. For this service, the Subadviser receives a fee
from the Manager, payable monthly equal to .75% per annum of the average
monthly net Qualifying Assets of the Fund, i.e., the Qualifying Assets less any
related liabilities as designated by the Manager. For the period June 1, 1994
through December 31, 1994, the Fund did not require the services of the
Subadviser.
The Subadviser was founded in 1991 as a joint venture between the Manager and
Henderson International, Inc., a controlled affiliate of Henderson Administra-
tion Group plc. The Subadviser, headquartered in New York, was created to pro-
vide international and global investment advice to institutional and individual
investors and investment companies in the United States. The Subadviser cur-
rently serves as subadviser to Seligman Capital Fund, Inc., Seligman Common
Stock Fund, Inc., Seligman Frontier Fund, Inc., Seligman Growth Fund, Inc., Se-
ligman Henderson Global Fund Series, Inc., Seligman Income Fund, Inc., the
Global Portfolio and Global Smaller Companies Portfolio of Seligman Portfolios,
Inc., Tri-Continental Corporation, the International Equity Fund of The Compass
Capital Group, and the Seligman Henderson International Small Capital Portfolio
and Seligman Henderson International Equity Portfolio of the American Skandia
Trust. The address of the Subadviser is 100 Park Avenue, New York, NY 10017.
PORTFOLIO MANAGER. Paul H. Wick is a Managing Director of the Manager and
Vice President and Portfolio Manager of the Fund, Seligman Frontier Fund, Inc.,
and the Seligman Communications and Information Portfolio and the Seligman
Frontier Portfolio of Seligman Portfolios, Inc. Mr. Wick also co-manages Selig-
man Henderson Global Technology Fund, a series of Seligman Henderson Global
Fund Series, Inc. Mr. Wick joined the Manager in 1987 as an Associate, Invest-
ment Research, and from April 1989 to December 1989 was co-manager of Seligman
High-Yield Bond Series. He was promoted to Managing Director on January 1,
1995.
Mr. Brian Ashford-Russell will be responsible for the Subadviser's day-to-day
investment activity with respect to the Fund to the extent there are Qualifying
Assets. Mr. Ashford-Russell has been a Portfolio Manager with Henderson Admin-
istration Group plc since February 1993. He was previously a Portfolio Manager
with Touche Remnant & Co.
The Manager's discussion of the Fund's performance as well as a line graph
illustrating comparative performance information between the Fund, the Standard
& Poor's 500 Composite Stock Price Index and
8
<PAGE>
the Lipper Science and Technology Fund Average is included in the Fund's 1994
Annual Report to Shareholders. Copies of the 1994 Annual Report may be ob-
tained, without charge, by calling or writing the Fund at the telephone numbers
or address listed on the front page of this Prospectus.
PORTFOLIO TRANSACTIONS. The Management Agreement and Subadvisory Agreement
recognize that in the purchase and sale of portfolio securities, the Manager
and Subadviser will seek the most favorable price and execution, and, consis-
tent with that policy, may give consideration to the research, statistical and
other services furnished by brokers or dealers to the Manager and Subadviser.
The use of brokers who provide investment and market research and securities
and economic analysis may result in higher brokerage charges than the use of
brokers selected on the basis of the most favorable brokerage commission rates
and research and analysis received may be useful to the Manager and Subadviser
in connection with its services to other clients as well as to the Fund. In
over-the-counter markets, orders are placed with responsible primary market
makers unless a more favorable execution or price is believed to be obtainable.
Consistent with the rules of the National Association of Securities Dealers,
Inc., and subject to seeking the most favorable price and execution available
and such other policies as the Directors may determine, the Manager and
Subadviser may consider sales of shares of the Fund and, if permitted by appli-
cable laws, may consider sales of shares of the other funds in the Seligman
Group as a factor in the selection of brokers or dealers to execute portfolio
transactions for the Fund.
PORTFOLIO TURNOVER. A change in securities held by the Fund is known as
"portfolio turnover" which may result in the payment by the Fund of dealer
spreads or underwriting commissions and other transaction costs on the sale of
securities as well as on the reinvestment of the proceeds in other securities.
Although it is the policy of the Fund to hold securities for investment,
changes in the securities held by the Fund will be made from time to time when
the Manager and Subadviser believe such changes will strengthen the Fund's
portfolio. The portfolio turnover of the Fund may exceed 100% and has done so
in prior years.
PURCHASE OF SHARES
Seligman Financial Services, Inc. ("SFSI"), an affiliate of the Manager, acts
as general distributor of the Fund's shares. Its address is 100 Park Avenue,
New York, New York 10017.
The Fund issues two classes of shares: Class A shares are sold to investors
choosing the initial sales load alternative; and Class D shares are sold to in-
vestors choosing no initial sales load, a higher distribution fee and a CDSL on
redemptions within one year of purchase. See "Alternative Distribution System"
above.
Shares of the Fund may be purchased through any authorized investment dealer.
All orders will be executed at the net asset value per share next computed af-
ter receipt of the purchase order plus, in the case of Class A shares, a sales
load which, except for shares purchased under one of the reduced sales load
plans, will vary with the size of the purchase as shown in the schedule under
"Class A Shares--Initial Sales Load" below.
The Fund will discontinue indefinitely the sale of its shares to new invest-
ors, including, subject to the exceptions in this paragraph, IRAs and retire-
ment plans, at the close of business on June 30, 1995. The Fund will continue
to accept additional investments from existing shareholders, and will continue
to reinvest dividends and capital gains distributions with respect to the ac-
counts of existing shareholders who have elected those options. The Fund will
also continue to sell shares to (i) group retirement plans (including 401(k)
plans) that have been established by June 30, 1995 for which funding has begun
no later than September 30, 1995, and (ii) IRAs established via a transfer-of-
assets postmarked by June 30. The decision to discontinue sales to new invest-
ors reflects the manager's belief that unrestrained growth in the Fund's assets
might impair the Fund's investment flexibility and would not be in the best in-
terests of
9
<PAGE>
shareholders. The Fund may recommence the sale of its shares to new investors
if it is deemed by the Fund's Board of Directors to be in the best interests of
shareholders.
THE MINIMUM AMOUNT FOR INITIAL INVESTMENT IN THE FUND IS $1,000 (EXCEPT FOR
AN ACCOUNT BEING ESTABLISHED PURSUANT TO THE INVEST-A-CHECK (R) SERVICE); SUB-
SEQUENT INVESTMENTS MUST BE IN THE MINIMUM AMOUNT OF $100 (EXCEPT FOR INVEST-
MENT OF DIVIDENDS AND CAPITAL GAIN DISTRIBUTIONS). THE FUND RESERVES THE RIGHT
TO RETURN INVESTMENTS WHICH DO NOT MEET THESE MINIMUMS.
Orders received by an authorized dealer before the close of business on the
New York Stock Exchange ("NYSE") (4:00 p.m. Eastern time) and accepted by SFSI
before the close of business (5:00 p.m. Eastern time) on the same day will be
executed at the Fund's net asset value determined as of the close of the NYSE
on that day plus, in the case of Class A shares, the applicable sales load. Or-
ders accepted by dealers after the close of the NYSE, or received by SFSI after
the close of business, will be executed at the Fund's net asset value as next
determined plus, in the case of Class A shares, the applicable sales load. The
authorized dealer through which a shareholder purchases shares is responsible
for forwarding the order to SFSI promptly.
Payment for dealer purchases may be made by check or by wire. To wire pay-
ment, dealer orders must first be placed through SFSI's order desk and assigned
a purchase confirmation number. Funds in payment of the purchase may then be
wired to Mellon Bank, N.A., ABA #043000261, A/C Seligman Communications & In-
formation Fund, Inc. (A or D), A/C #107-1011. WIRE TRANSFERS MUST INCLUDE THE
PURCHASE CONFIRMATION NUMBER AND CLIENT ACCOUNT REGISTRATION AND ACCOUNT NUM-
BER. Persons other than dealers who wish to wire payment should contact Selig-
man Data Corp. for specific wire instructions. Although the Fund makes no
charge for this service, the transmitting bank may impose a wire service fee.
Existing shareholders may purchase additional shares at any time through any
authorized dealer or by sending a check payable to the "Seligman Group of Mu-
tual Funds" directly to P.O. BOX 3936, NEW YORK, NY 10008-3936. Checks for in-
vestment must be in U.S. dollars drawn on a domestic bank. The check should in-
clude the shareholder's name, address, account number, name of Fund and class
of shares. If a shareholder does not indicate the required information, Selig-
man Data Corp. will seek further clarification and may be forced to return the
check to the shareholder. If only the class designation is missing, the invest-
ment will automatically be made in Class A shares. Orders sent directly to Se-
ligman Data Corp. will be executed at the Fund's net asset value next deter-
mined after the order is accepted plus, in the case of Class A shares, the ap-
plicable sales load.
Seligman Data Corp. will charge a $10.00 service fee for checks returned to
it marked "unpaid." This charge may be deducted from the account that requested
the purchase. For the protection of the Fund and its shareholders, no redemp-
tion proceeds will be remitted to a shareholder with respect to shares pur-
chased by check (unless certified) until Seligman Data Corp. receives notice
that the check has cleared, which may be up to 15 days from the credit of the
shares to the shareholder's account.
VALUATION. The net asset value of the Fund's shares is determined each day,
Monday through Friday, as of the close of trading on the NYSE (usually 4:00
p.m. Eastern time) on each day that the NYSE is open for business. Net asset
value is calculated separately for each class. Securities traded on a U.S. or
foreign exchange or over-the-counter market are valued at the last sales price
on the primary exchange or market on which they are traded. United Kingdom se-
curities and securities for which there are no recent sales transactions are
valued based on quotations provided by primary market makers in such securi-
ties. Any securities for which recent market quotations are not readily avail-
able are valued at fair value determined in accordance with procedures approved
by the Board of Directors. Short-term holdings maturing in 60
10
<PAGE>
days or less are generally valued at amortized cost if their original maturity
was 60 days or less. Short-term holdings with more than 60 days remaining to
maturity will be valued at current market value until the 61st day prior to ma-
turity, and will then be valued on an amortized cost basis based on the value
as of such date unless the Board determines that amortized cost value does not
represent fair market value.
Although the legal rights of Class A and Class D shares are substantially
identical, the different expenses borne by each class will result in different
net asset values and dividends. The net asset value of Class D shares will gen-
erally be lower than the net asset value of Class A shares as a result of the
larger distribution fee charged to Class D shares. In addition, net asset value
per share of the two classes will be affected to the extent any other class ex-
pense differs among classes.
CLASS A SHARES--INITIAL SALES LOAD. Class A shares are subject to an initial
sales load which varies with the size of the purchase as shown in the schedule
below, and an annual service fee of up to .25% of the average daily net asset
value of Class A shares. See "Administration, Shareholder Services and Distri-
bution Plan" below.
CLASS A SHARES--SALES LOAD SCHEDULE
<TABLE>
<CAPTION>
SALES LOAD AS A
PERCENTAGE OF REGULAR
------------------- DEALER
NET AMOUNT DISCOUNT
INVESTED AS A % OF
AMOUNT OF OFFERING (NET ASSET OFFERING
PURCHASE PRICE VALUE) PRICE
--------- -------- ---------- ---------
<S> <C> <C> <C>
Less
than $ 50,000 4.75% 4.99% 4.25%
$ 50,000- 99,999 4.00 4.17 3.50
100,000- 249,999 3.50 3.63 3.00
250,000- 499,999 2.50 2.56 2.25
500,000- 999,999 2.00 2.04 1.75
1,000,000- 3,999,999 1.00 1.01 .90
4,000,000- or more* 0 0 0
</TABLE>
-------
* Dealers will receive a fee of
.15% on sales of $4,000,000 or
more.
REDUCED SALES LOADS. Reductions in sales loads apply to purchases of Class A
shares by a "single person," including an individual, members of a family unit
comprising husband, wife and minor children purchasing securities for their own
account, or a trustee or other fiduciary purchasing for a single fiduciary ac-
count or single trust. Purchases made by a trustee or other fiduciary for a fi-
duciary account may not be aggregated with purchases made on behalf of any
other fiduciary or individual account.
. VOLUME DISCOUNTS are provided if the total amount being invested in Class A
shares of the Fund alone, or in any combination of shares of the other funds in
the Seligman Group that are sold with a sales load reaches levels indicated in
the above sales load schedule.
. THE RIGHT OF ACCUMULATION allows an investor to combine the amount being in-
vested in Class A shares of the other mutual funds in the Seligman Group sold
with a sales load with the total net asset value of shares of those funds al-
ready owned that were sold with a sales load and the total net asset value of
shares of Seligman Cash Management Fund that were acquired by the investor
through an exchange of shares of another mutual fund in the Seligman Group on
which there was a sales load to determine reduced sales loads in accordance
with the sales load schedule. An investor or a dealer purchasing shares on be-
half of an investor must indicate that the investor has existing accounts when
making investments or opening new accounts.
. A LETTER OF INTENT allows an investor to purchase Class A shares over a 13-
month period at reduced sales loads, based upon the total amount the investor
intends to purchase, plus the total net asset value of shares of the other mu-
tual funds in the Seligman Group already owned that were sold with a sales load
and the total net asset value of shares of Seligman Cash Management Fund that
were acquired through an exchange of shares of another mutual fund in the Se-
ligman Group on which there was a sales load. An investor or a dealer purchas-
ing shares on behalf of an
11
<PAGE>
investor must indicate that the investor has existing accounts when making in-
vestments or opening new accounts. For more information concerning terms of
Letters of Intent, see "Terms and Conditions" on page 24.
SPECIAL PROGRAMS. The Fund may sell Class A shares at net asset value to
present and retired directors, trustees, officers, employees (and their
spouses and minor children) of the Fund, the other investment companies in the
Seligman Group, the Manager and other companies affiliated with the Manager.
Such sales also may be made to employee benefit and thrift plans for such per-
sons and to any investment advisory, custodial, trust or other fiduciary ac-
count managed or advised by the Manager or any affiliate.
Class A shares also may be issued without a sales load in connection with
the acquisition of cash and securities owned by other investment companies and
personal holding companies; to any registered unit investment trust which is
the issuer of periodic payment plan certificates, the net proceeds of which
are invested in Fund shares; to separate accounts established and maintained
by an insurance company which are exempt from registration under Section
3(c)(11) of the 1940 Act; to registered representatives and employees (and
their spouses and minor children) of any dealer that has a sales agreement
with SFSI; to shareholders of mutual funds with objectives and policies simi-
lar to the Fund who purchase shares with redemption proceeds of such funds; to
financial institution trust departments; to registered investment advisers ex-
ercising discretionary investment authority with respect to the purchase of
Fund shares; to accounts of financial institutions or broker/dealers that
charge account management fees, provided the Manager or one of its affiliates
has entered into an agreement with respect to such accounts; pursuant to spon-
sored arrangements with organizations which make recommendations to or permit
group solicitations of, its employees, members or participants in connection
with the purchase of shares of the Fund; and to "eligible employee benefit
plans" of employers who have at least 2,000 U.S. employees to whom such a plan
is made available and, regardless of the number of employees, if such plan is
established and maintained by any dealer that has a sales agreement with SFSI.
"Eligible employee benefit plans" means any plan or arrangement, whether or
not tax qualified, which provides for the purchase of Fund shares. Sales of
shares to such plans must be made in connection with a payroll deduction sys-
tem of plan funding or other system acceptable to Seligman Data Corp.
CLASS D SHARES. Class D shares are sold without an initial sales load but
are subject to CDSL if the shares are redeemed within one year, an annual dis-
tribution fee of up to .75 of 1% and an annual service fee of up to .25 of 1%
of the average daily net asset value of Class D shares. SFSI will make a 1%
payment to dealers in respect of purchases of Class D shares.
A CDSL will be imposed on any redemption of Class D shares which were pur-
chased during the preceding twelve months; however, no such charge will be im-
posed on shares acquired through the investment of dividends or distributions
from any Class D shares within the Seligman Group. The amount of any CDSL will
be paid to and retained by SFSI.
To minimize the application of CDSL to a redemption, shares acquired pursu-
ant to the investment of dividends and distributions will be redeemed first;
followed by shares purchased at least one year prior to the redemption. Shares
held for the longest period of time within the applicable one year period will
then be redeemed. Additionally, for those shares determined to be subject to
the CDSL, the application of the 1% CDSL will be made to the current net asset
value or original purchase price, whichever is less.
For example, assume an investor purchased 100 shares in January at a price
of $10.00 per share. During the first year, 5 additional shares were acquired
through investment of dividends and distributions. In January of the following
year, an additional 50 shares are purchased at a price of $12.00 per share. In
March of that year, the investor chooses to redeem $1,500.00 from the account
which now holds 155 shares with a total value of $1,898.75 ($12.25 per
12
<PAGE>
share). The CDSL for this transaction would be calculated as follows:
<TABLE>
<S> <C>
Total shares to be redeemed
(122.449 @ $12.25) as follows:...................................... $1,500.00
=========
Dividend/Distribution shares
(5 @ $12.25)........................................................ $ 61.25
Shares held more than 1 year (100 @ $12.25)......................... 1,225.00
Shares held less than 1 year subject to
CDSL (17.449 @ $12.25).............................................. 213.75
---------
Gross proceeds of redemption ....................................... 1,500.00
Less CDSL (17.449 shares @ $12.00 = $209.39 X 1% = $2.09) ......... (2.09)
---------
Net proceeds of redemption.......................................... $1,497.91
=========
</TABLE>
For federal income tax purposes, the amount of the CDSL will reduce the gain
or increase the loss, as the case may be, on the amount recognized on the re-
demption of shares.
The CDSL will be waived or reduced in the following instances:
(a) on redemptions following the death or disability of a shareholder, as de-
fined in section 72(m)(7) of the Internal Revenue Code of 1986, as amended (the
"Code"); (b) in connection with (i) distributions from retirement plans quali-
fied under section 401(a) of the Code when such redemptions are necessary to
make distributions to plan participants (such payments include, but are not
limited to death, disability, retirement, or separation of service), (ii) dis-
tributions from a custodial account under Code section 403 (b)(7) or an indi-
vidual retirement account ("IRA") due to death, disability, or attainment of
age 59 1/2, and (iii) a tax-fee return of an excess contribution to an IRA; (c)
in whole or in part, in connection with shares sold to current and retired Di-
rectors of the Fund; (d) in whole or in part, in connection with shares sold to
any state, county, or city or any instrumentality, department, authority, or
agency thereof, which is prohibited by applicable investment laws from paying a
sales load or commission in connection with the purchase of shares of any reg-
istered investment management company; (e) pursuant to an automatic cash with-
drawal service; (f) in connection with the redemption of Class D shares of the
Fund if it is combined with another mutual fund in the Seligman Group, or an-
other similar reorganization transaction; and (g) in connection with the Fund's
right to redeem or liquidate an account that holds below a certain minimum num-
ber or dollar amount of shares (currently $500).
If, with respect to a redemption of any Class D shares sold by a dealer, the
CDSL is waived because the redemption qualifies for a waiver as set forth
above, the dealer shall remit to SFSI promptly upon notice an amount equal to
the 1% payment or a portion of the 1% payment paid on such shares.
SFSI may from time to time assist dealers by, among other things, providing
sales literature to, and holding informational programs for the benefit of,
dealers' registered representatives. Dealers may limit the participation of
registered representatives in such informational programs by means of sales in-
centive programs which may require the sale of minimum dollar amounts of shares
of the mutual funds in the Seligman Group. SFSI may from time to time pay a bo-
nus or other incentive to dealers that sell shares of the Seligman Mutual
Funds. In some instances, these bonuses or incentives may be offered only to
certain dealers which employ registered representatives who have sold or may
sell a significant amount of shares of the Fund and/or certain other funds man-
aged by the Manager during a specified period of time. Such bonus or other in-
centive may take the form of payment for travel expenses, including lodging,
incurred in connection with trips taken by qualifying registered representa-
tives and members of their families to places within or outside the United
States. The cost of SFSI of such promotional activities and payments shall be
consistent with the rules of the National Association of Securities Dealers,
Inc., as then in effect.
13
<PAGE>
TELEPHONE TRANSACTIONS
A shareholder whose account has either an individual or joint tenancy regis-
tration may elect to effect the following transactions via telephone by com-
pleting the Telephone Service Election portion of the Account Application or a
separate Telephone Service Election Form: (i) redemption of Fund shares, (ii)
exchange of Fund shares for shares of another Seligman Mutual Fund, (iii)
change of a dividend and/or capital gain distribution option, and (iv) change
of address. IRA accounts may only elect to effect exchanges or address changes.
By completing the appropriate section of the Account Application or separate
Election Form, all Seligman Mutual Funds with the same account number (i.e.,
registered in exactly the same names), including any new fund in which the
shareholder invests in the future, will automatically have telephone services.
All telephone transactions are effected through Seligman Data Corp. at (800)
221-2450.
For accounts registered as joint tenancies, each joint tenant, by electing
telephone transaction services, authorizes each of the other tenants to effect
telephone transactions on his or her behalf.
During times of drastic economic or market changes, a shareholder may experi-
ence difficulty in contacting Seligman Data Corp. to request a redemption or
exchange of Fund shares. In these circumstances, the shareholder should con-
sider using other redemption or exchange procedures. (See "Redemption Of
Shares" below.) Use of these other redemption or exchange procedures will re-
sult in the redemption request being processed at a later time than if tele-
phone transactions had been used, and the Fund's net asset value may fluctuate
during such periods.
The Fund and Seligman Data Corp. will employ reasonable procedures to confirm
that instructions communicated by telephone are genuine. These will include:
recording all telephone calls requesting account activity, requiring that the
caller provide certain requested personal and/or account information at the
time of the call for the purpose of establishing the caller's identity, and
sending a written confirmation of redemptions, exchanges or address changes to
the address of record each time activity is initiated by telephone. As long as
the Fund and Seligman Data Corp. follow instructions communicated by telephone
that were reasonably believed to be genuine at the time of their receipt, nei-
ther they nor any of their affiliates will be liable for any loss to the share-
holder caused by an unauthorized transaction. Shareholders are, of course, un-
der no obligation to apply for telephone transaction services. In any instance
where the Fund or Seligman Data Corp. is not reasonably satisfied that instruc-
tions received by telephone are genuine, the requested transaction will not be
executed, and neither they nor any of their affiliates will be liable for any
losses which may occur due to a delay in implementing the transaction. If the
Fund or Seligman Data Corp. does not follow the procedures described above, the
Fund or Seligman Data Corp. may be liable for any losses due to unauthorized or
fraudulent instructions. Telephone services must be effected through a repre-
sentative of Seligman Data Corp., i.e., requests may not be communicated via
Seligman Data Corp.'s automated telephone answering system. Telephone transac-
tion services may be terminated by a shareholder at any time by sending a writ-
ten request to Seligman Data Corp. Written acknowledgment of termination of
telephone transaction services will be sent to the shareholder.
REDEMPTION OF SHARES
A shareholder may redeem shares held in book credit form without charge (ex-
cept a CDSL, if applicable) at any time by SENDING A WRITTEN REQUEST to
Seligman Data Corp., 100 Park Avenue, New York, New York 10017. The redemption
request must be signed by all persons in whose name the shares are registered.
A shareholder may redeem shares that are not in book credit form by surrender-
ing certificates in proper form to the same address. Certificates should be
sent by registered mail. Share certificates must be endorsed for transfer or
accompanied by an endorsed stock power signed by all share owners exactly as
their name(s) appear(s) on the account registration.
14
<PAGE>
The shareholder's letter of instruction or endorsed stock power should specify
the account number, class of shares (A or D) and the number of shares or dollar
amount to be redeemed. The Fund cannot accept conditional redemption requests.
If the redemption proceeds are (i) $50,000 or more, (ii) to be paid to someone
other than the shareholder of record (regardless of the amount) or (iii) to be
mailed to other than the address of record (regardless of the amount), the sig-
nature(s) of the shareholder(s) must be guaranteed by an eligible financial in-
stitution including, but not limited to, the following: banks, trust companies,
credit unions, securities brokers and dealers, savings and loan associations
and participants in the Securities Transfer Association Medallion Program
(STAMP), the Stock Exchanges Medallion Program (SEMP) or the New York Stock Ex-
change Medallion Signature Program (MSP). The Fund reserves the right to reject
a signature guarantee where it is believed that the Fund will be placed at risk
by accepting such guarantee. A signature guarantee is also necessary in order
to change the account registration. Notarization by a notary public is not an
acceptable signature guarantee. ADDITIONAL DOCUMENTATION MAY ALSO BE REQUIRED
BY SELIGMAN DATA CORP. IN THE EVENT OF A REDEMPTION BY CORPORATIONS, EXECUTORS,
ADMINISTRATORS, TRUSTEES, CUSTODIANS OR RETIREMENT PLANS. FOR FURTHER INFORMA-
TION WITH RESPECT TO NECESSARY REDEMPTION REQUIREMENTS, PLEASE CONTACT THE
SHAREHOLDER SERVICES DEPARTMENT OF SELIGMAN DATA CORP. FOR ASSISTANCE. In the
case of Class A shares, and in the case of Class D shares redeemed after one
year, a shareholder will receive the net asset value per share next determined
after receipt of a request in good order. If Class D shares are redeemed within
one year of purchase, a shareholder will receive the net asset value per share
next determined after receipt of a request in good order, less a CDSL of 1% as
described under "Purchase Of Shares--Class D Shares" above.
A shareholder also may "sell" shares to the Fund through an investment dealer
and, in that way, be certain, providing the order is timely, of receiving the
net asset value established at the end of the day on which the dealer is given
the repurchase order. The Fund makes no charge for this transaction, but the
dealer may charge you a service fee. "Sell" or repurchase orders received from
an authorized dealer before the close of the NYSE and received by SFSI, the re-
purchase agent, before the close of business on the same day will be executed
at the net asset value per share determined as of the close of the NYSE on that
day. Repurchase orders received from authorized dealers after the close of the
NYSE or not received by SFSI prior to the close of business, will be executed
at the net asset value determined as of the close of the NYSE on the next trad-
ing day. Shares held in a "street name" account with a broker/dealer may be
sold to the Fund only through a broker/dealer.
TELEPHONE REDEMPTIONS. Telephone redemptions of uncertificated shares may be
made in an amount of up to $50,000 per day, per account. One telephone redemp-
tion request per day is permitted. Telephone redemption requests must be re-
ceived by Seligman Data Corp. at (800) 221-2450 between 8:30 a.m. and 4:00 p.m.
Eastern time, on any business day and will be processed as of the close of
business on that day. Redemption requests by telephone will not be accepted
within 30 days following an address change. Keogh Plans, IRAs or other retire-
ment plans are not eligible for telephone redemptions. The Fund reserves the
right to suspend or terminate its telephone redemption service at any time
without notice.
For more information about telephone redemptions, including the procedure for
electing such service and the circumstances under which shareholders may bear
the risk of loss for a fraudulent transaction, see "Telephone Transactions"
above.
GENERAL. Whether shares are redeemed or repurchased, a check for the proceeds
will be sent to the address of record within seven calendar days after accept-
ance of the redemption or repurchase order and will be made payable to all of
the registered owners on the Account. The Fund will not permit redemp
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<PAGE>
tions of shares purchased by check (unless certified) until Seligman Data
Corp. receives notice that the check has cleared, which may be up to 15 days
from the credit of the shares to the shareholder's account. The proceeds of a
redemption or repurchase may be more or less than the shareholder's cost.
The Fund reserves the right to redeem shares owned by a shareholder whose
investment in the Fund has a value of less than a minimum amount specified by
the Fund's Board of Directors, which is presently $500. Shareholders are sent
a notice before the redemption is processed stating that the value of their
investment in the Fund is less than the specified minimum and that they have
sixty days to make an additional investment.
REINSTATEMENT PRIVILEGE. If a shareholder redeems Class A shares and then
decides not to redeem them, or to shift your investment to one of the other
mutual funds in the Seligman Group, the shareholder may, within 120 calendar
days of the date of redemption, use all or any part of the proceeds of the re-
demption to reinstate, free of sales load, all or any part of the investment
in shares of the Fund or in shares of any of the other mutual funds in the Se-
ligman Group. If a shareholder redeems Class D shares and the redemption was
subject to a CDSL, the shareholder may reinstate the investment in shares of
the same class of the Fund or in any of the other mutual funds in the Seligman
Group within 120 calendar days of the date of redemption and receive a credit
for the CDSL paid. Such investment will be reinstated at the net asset value
per share established as of the close of the NYSE on the day the request is
received. Seligman Data Corp. must be informed that the purchase represents a
reinstated investment. REINSTATED SHARES MUST BE REGISTERED EXACTLY AND BE OF
THE SAME CLASS AS THE SHARES PREVIOUSLY REDEEMED.
Generally, exercise of the Reinstatement Privilege does not alter the Fed-
eral income tax status of any capital gain realized on a sale of Fund shares,
but to the extent that any shares are sold at a loss and the proceeds are re-
invested in shares of the same Fund, some or all of the loss will not be al-
lowed as a deduction, depending upon the percentage of the proceeds reinvest-
ed.
ADMINISTRATION, SHAREHOLDER SERVICES AND DISTRIBUTION PLAN
Under the Fund's Administration, Shareholder Services and Distribution Plan
(the "Plan"), the Fund may pay to SFSI an administration, shareholder services
and distribution fee in respect of the Fund's Class A and Class D shares. Pay-
ments under the Plan may include, but are not limited to: (i) compensation to
securities dealers and other organizations ("Service Organizations") for pro-
viding distribution assistance with respect to assets invested in the Fund,
(ii) compensation to Service Organizations for providing administration, ac-
counting and other shareholder services with respect to Fund shareholders, and
(iii) otherwise promoting the sale of shares of the Fund, including paying for
the preparation of advertising and sales literature and the printing and dis-
tribution of such promotional materials and prospectuses to prospective in-
vestors and defraying SFSI's costs incurred in connection with its marketing
efforts with respect to shares of the Fund. The Manager, in its sole discre-
tion, may also make similar payment to SFSI from its own resources, which may
include the management fee that the Manager receives from the Fund.
Under the Plan, the Fund reimburses SFSI for its expenses with respect to
Class A shares at an annual rate of up to .25% of the average daily net asset
value of Class A shares. It is expected that the proceeds from the fee in re-
spect of Class A shares will be used primarily to compensate Service Organiza-
tions which enter into agreements with SFSI. Such Service Organ-izations will
receive from SFSI a continuing fee of up to .25% on an annual basis, payable
quarterly, of the average daily net assets of Class A shares attributable to
the particular Service Organization for providing
16
<PAGE>
personal service and/or the maintenance of shareholder accounts. The fee pay-
able from time to time is, within such limit, determined by the Directors of
the Fund.
The Plan, as it relates to Class A shares, was approved by shareholders on
November 23, 1992 and became effective on January 1, 1993. The Plan is reviewed
by the Directors annually. The total amount paid for the year ended December
31, 1994 in respect of the Fund's Class A shares pursuant to the Plan was equal
to .21% of the Class A shares' average daily net assets.
Under the Plan, the Fund reimburses SFSI for its expenses with respect to
Class D shares at an annual rate of up to 1% of the average daily net asset
value of the Class D shares. Proceeds from the Class D distribution fee are
used primarily to compensate Service Organizations for administration, share-
holder services and distribution assistance (including a continuing fee of up
to .25% on an annual basis of the average daily net asset value of Class D
shares attributable to particular Service Organizations for providing personal
service and/or the maintenance of shareholder accounts) and will initially be
used by SFSI to defray the expense of the 1% payment made by it to Service Or-
ganizations at the time of the sale of Class D shares. The amounts expended by
SFSI in any one year upon the initial purchase of Class D shares may exceed the
amounts received by it from Plan payments retained. Expenses of administration,
shareholder services and distribution of Class D shares in one fiscal year of
the Fund may be paid from Class D Plan fees received from the Fund in any other
fiscal year.
The Plan, as it relates to Class D shares, was approved by the Directors on
March 18, 1993 and became effective May 1, 1993. The Plan is reviewed by the
Directors annually. The total amount paid for the year ended December 31, 1994
by the Fund's Class D shares pursuant to the Plan was 1% per annum of the aver-
age daily net assets of Class D shares.
Seligman Services, Inc. ("SSI"), an affiliate of the Manager, is a limited
purpose broker/dealer. SSI shall act as broker/dealer of record for most share-
holder accounts that do not have a designated broker/dealer of record, includ-
ing all such shareholder accounts established after April 1, 1995 and will re-
ceive compensation for providing personal service and account maintenance to
its accounts of record.
EXCHANGE PRIVILEGE
A shareholder of the Fund may, without charge, exchange at net asset value
any or all of an investment in the Fund for shares of any of the other mutual
funds in the Seligman Group. Exchanges may be made by mail, or by telephone, if
telephone services are elected by the shareholder.
Class A and Class D shares may be exchanged only for Class A and Class D
shares, respectively, of another mutual fund in the Seligman Group on the basis
of relative net asset value.
If Class D shares that are subject to a CDSL are exchanged for Class D shares
of another fund, for purposes of assessing the CDSL payable upon disposition of
the exchanged Class D shares, the one year holding period shall be reduced by
the holding period of the original Class D shares.
The mutual funds in the Seligman Group available under the Exchange Privilege
are:
. SELIGMAN CAPITAL FUND, INC: seeks aggressive capital appreciation. Current
income is not an objective.
. SELIGMAN CASH MANAGEMENT FUND, INC: invests in high quality money market
instruments. Shares are sold at net asset value.
. SELIGMAN COMMON STOCK FUND, INC: seeks favorable current income and long-
term growth of both income and capital value without exposing capital to undue
risk.
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<PAGE>
. SELIGMAN FRONTIER FUND, INC: seeks to produce growth in capital value; in-
come may be considered but will only be incidental to the Fund's investment
objective.
. SELIGMAN GROWTH FUND, INC: seeks longer-term growth in capital value and
an increase in future income.
. SELIGMAN HENDERSON GLOBAL FUND SERIES, INC: consists of the Seligman Hen-
derson International Fund, the Seligman Henderson Global Smaller Companies
Fund and the Seligman Henderson Global Technology Fund, which seek long-term
capital appreciation primarily by investing either in companies globally or
internationally.
. SELIGMAN HIGH INCOME FUND SERIES: seeks high current income by investing
in debt securities. The Fund consists of the U.S. Government Securities Series
and the High-Yield Bond Series.
. SELIGMAN INCOME FUND, INC: seeks high current income and the possibility
of improvement of future income and capital value.
. SELIGMAN NEW JERSEY TAX-EXEMPT FUND, INC: invests in investment grade New
Jersey tax-exempt securities.
. SELIGMAN PENNSYLVANIA TAX-EXEMPT FUND SERIES: invests in investment grade
Pennsylvania tax-exempt securities.
. SELIGMAN TAX-EXEMPT FUND SERIES, INC: consists of several State Series and
a National Series. The National Tax-Exempt Series seeks to provide maximum in-
come exempt from Federal income taxes; individual state series, each seeking
to maximize income exempt from Federal income taxes and from personal income
taxes in designated states, are available for Colorado, Georgia, Louisiana,
Maryland, Massachusetts, Michigan, Minnesota, Missouri, New York, Ohio, Oregon
and South Carolina.
. SELIGMAN TAX-EXEMPT SERIES TRUST: includes a California Tax-Exempt Quality
Series, a California Tax-Exempt High-Yield Series, a Florida Tax-Exempt Series
and a North Carolina Tax-Exempt Series, each of which invests in tax-exempt
securities of its designated state.
All permitted exchanges will be based on the then current net asset values
of the respective funds. Telephone requests for exchanges must be received be-
tween 8:30 a.m. and 4:00 p.m. Eastern time, on any business day, by Seligman
Data Corp. at (800) 221-2450, and will be processed as of the close of busi-
ness on that day. The registration of an account into which an exchange is
made must be identical to the registration of the account from which shares
are exchanged. When establishing a new account by an exchange of shares, the
shares being exchanged must have a value of at least the minimum initial in-
vestment required by the mutual fund into which the exchange is being made.
The method of receiving distributions, unless otherwise indicated, will be
carried over to the new Fund account. Account services, such as Invest-A-
Check (R) Service, Directed Dividends and Automatic Cash Withdrawal Service
will not be carried over to the new Fund account unless specifically requested
and permitted by the new Fund. Exchange orders may be placed to effect an ex-
change of a specific number of shares, an exchange of shares equal to a spe-
cific dollar amount or an exchange of all shares held. Shares for which cer-
tificates have been issued may not be exchanged via telephone and may be ex-
changed only upon receipt of a written exchange request together with certifi-
cates representing shares to be exchanged in form for transfer.
Telephone exchanges are only available to shareholders whose accounts are
registered individually, as joint tenancies or IRAs. The Exchange Privilege
via mail is generally applicable to investments in an IRA and other retirement
plans, although some restrictions may apply and may be applicable to other mu-
tual funds in the Seligman Group that may be organized by the Manager in the
future. The terms of the exchange offer described herein may be modified at
any time;
18
<PAGE>
and not all of the mutual funds in the Seligman Group are available to resi-
dents of all states. Before making any exchange a shareholder should contact an
authorized investment dealer or Seligman Data Corp. to obtain prospectuses of
any of the mutual funds in the Seligman Group.
A broker/dealer of record will be able to effect exchanges on behalf of a
shareholder only if the broker/dealer has entered into a Telephone Exchange
Agreement with SFSI wherein the broker/dealer must agree to indemnify SFSI and
the mutual funds in the Seligman Group from any loss or liability incurred as a
result of the acceptance of telephone exchange orders.
Written confirmation of all exchanges will be forwarded to the shareholder to
whom the exchanged shares are registered and a duplicate confirmation will be
sent to the dealer of record listed on the account. SFSI reserves the right to
reject a telephone exchange request. The Fund reserves the right to reject any
telephone requests for transactions with a share value exceeding $250,000. Any
rejected telephone exchange order may be processed by mail. For more informa-
tion about telephone exchanges, including the procedure for electing such serv-
ice and the circumstances under which shareholders may bear the risk of loss
for a fraudulent transaction, see "Telephone Transactions" above.
Exchanges of shares are sales and may result in a gain or loss for Federal
income tax purposes.
FURTHER INFORMATION ABOUT TRANSACTIONS IN THE FUND
Because excessive trading (including short-term, "market timing" trading) can
hurt the Fund's performance, the Fund may refuse any exchange (1) from any
shareholder account from which there have been two exchanges in the preceding
three month period, or (2) where the exchanged shares equal in value the lesser
of $1,000,000 or 1% of the Fund's net assets. The Fund may also refuse any ex-
change or purchase order from any shareholder account if the shareholder or the
shareholder's broker/dealer has been advised that previous patterns of pur-
chases and redemptions or exchanges have been considered excessive. Accounts
under common ownership or control, including those with the same taxpayer ID
number and those administered so as to redeem or purchase shares based upon
certain predetermined market indicators, will be considered one account for
this purpose. Additionally, the Fund reserves the right to refuse any order for
the purchase of shares.
DIVIDENDS AND DISTRIBUTIONS
The Fund's net investment income, if any, is paid to shareholders in divi-
dends in December. Payments vary in amount depending on income received from
portfolio securities and the costs of operations. The Fund distributes substan-
tially all of any taxable net long-term and short-term gain realized on invest-
ments to shareholders at least annually; such distributions will generally be
taxable to shareholders in the year in which they are declared by the Fund if
paid before February 1 of the following year.
Shareholders may elect: (1) to receive both dividends and gain distributions
in shares; (2) to receive dividends in cash and gain distributions in shares;
(3) to receive both dividends and gain distributions in cash. In the case of
prototype retirement plans, dividends and gain distributions are reinvested in
additional shares. Unless another election is made, dividends and capital gains
distributions will be credited to shareholder accounts in additional shares.
Shares acquired through a dividend or gain distribution and credited to a
shareholder's account are not subject to an initial sales load or a CDSL. Divi-
dends and gain distributions paid in shares are invested at the net asset value
on the ex-dividend date. Shareholders may elect to change their dividend and
gain distribution options by writing Seligman Data Corp. at the address listed
below. If the shareholder has elected telephone services, changes may also be
telephoned to Seligman Data Corp. between 8:00 a.m. and 5:30 p.m. Eastern
19
<PAGE>
time, by either the shareholder or the broker/dealer of record on the account.
For information about electing telephone services, see "Telephone Transac-
tions." These elections must be received by Seligman Data Corp. before the rec-
ord date for the dividend or distribution in order to be effective for such
dividend or distribution, otherwise payment will be made in accordance with the
current option on the shareholder's account.
The per share dividends from net investment income on Class D shares will be
lower than the per share dividends on Class A shares as a result of the higher
distribution fee applicable with respect to Class D shares. Per share dividends
of the two classes may also differ as a result of differing class expenses.
Distributions of net capital gains, if any, will be paid in the same amount for
Class A and Class D shares. See "Purchase Of Shares--Valuation."
Shareholders exchanging shares of a mutual fund for shares of another mutual
fund in the Seligman Group will continue to receive dividends and gains as
elected prior to such exchange unless otherwise specified. In the event that a
shareholder redeems all shares in an account between the record date and the
payable date, the value of dividends or gain distributions declared will be
paid in cash regardless of the existing election.
FEDERAL INCOME TAXES
The Fund intends to continue to qualify as a regulated investment company un-
der the Internal Revenue Code of 1986, as amended. For each year so qualified,
the Fund will not be subject to Federal income taxes on its net investment in-
come and capital gains, if any, realized during any taxable year, which it dis-
tributes to its shareholders, provided that at least 90% of its net investment
income and net short-term capital gains are distributed to shareholders each
year.
Dividends from net investment income and distributions from net short-term
capital gains are taxable as ordinary income to the shareholders, whether re-
ceived in cash or reinvested in additional shares, and, to the extent desig-
nated as derived from the Fund's dividend income that would be eligible for the
dividends received deduction if the Fund were not a regulated investment compa-
ny, they are eligible, subject to certain restrictions, for the 70% dividends
received deduction for corporations.
Distributions of net capital gain, i.e., the excess of net long-term capital
gains over any net short-term losses, are taxable as long-term capital gain,
whether received in cash or invested in additional shares, regardless of how
long shares have been held by the shareholders; such distributions are not eli-
gible for the dividends received deduction allowed to corporate shareholders.
Any gain or loss realized upon a sale or redemption of shares in the Fund by
a shareholder who is not a dealer in securities will generally be treated as a
long-term capital gain or loss if the shares have been held for more than one
year and otherwise as a short-term capital gain or loss. However, if shares on
which a long-term capital gain distribution has been received are subsequently
sold or redeemed and such shares have been held for six months or less, any
loss realized will be treated as long-term capital loss to the extent that it
offsets the long-term capital gain distribution. In addition, no loss will be
allowed on the sale or other disposition of shares of the Fund if, within a pe-
riod beginning 30 days before the date of such sale or disposition and ending
30 days after such date, the holder acquires (such as through dividend rein-
vestment) securities that are substantially identical to the shares of the
Fund.
In determining gain or loss on shares of the Fund that are sold or exchanged
within 90 days after acquisition, a shareholder generally will not be permitted
to include in the tax basis attributable to such shares the sales load incurred
in acquiring such shares to the extent of any subsequent reduction of the sales
load by reason of the Exchange or Reinstatement Privilege offered by the Fund.
Any sales load not taken into account in determining the tax basis of shares
sold or
20
<PAGE>
exchanged within 90 days after acquisition will be added to the shareholder's
tax basis in the shares acquired pursuant to the Exchange or Reinstatement
Privilege.
The Fund will generally be subject to an excise tax of 4% on the amount of
any income or capital gains, above certain permitted levels, distributed to
shareholders on a basis such that such income or gain is not taxable to share-
holders in the calendar year in which it was earned. Furthermore, dividends de-
clared in October, November or December payable to shareholders of record on a
specified date in such a month and paid in the following January will be
treated as having been paid by the Fund and received by each shareholder in De-
cember. Under this rule, therefore, shareholders may be taxed in one year on
dividends or distributions actually received in January of the following year.
Shareholders are urged to consult their tax advisers concerning the effect of
Federal income taxes in their individual circumstances.
UNLESS A SHAREHOLDER INCLUDES A CERTIFIED TAXPAYER IDENTIFICATION NUMBER (SO-
CIAL SECURITY NUMBER FOR INDIVIDUALS) ON THE ACCOUNT APPLICATION AND CERTIFIES
THAT THE SHAREHOLDER IS NOT SUBJECT TO BACKUP WITHHOLDING, THE FUND IS REQUIRED
TO WITHHOLD AND REMIT TO THE U.S. TREASURY A PORTION OF DISTRIBUTIONS AND OTHER
REPORTABLE PAYMENTS TO THE SHAREHOLDER. THE RATE OF BACKUP WITHHOLDING IS 31%.
SHAREHOLDERS SHOULD BE AWARE THAT, UNDER REGULATIONS PROMULGATED BY THE INTER-
NAL REVENUE SERVICE, THE FUND MAY BE FINED $50 ANNUALLY FOR EACH ACCOUNT FOR
WHICH A CERTIFIED TAXPAYER IDENTIFICATION NUMBER IS NOT PROVIDED. IN THE EVENT
THAT SUCH A FINE IS IMPOSED, THE FUND MAY CHARGE A SERVICE FEE OF UP TO $50
THAT MAY BE DEBITED FROM THE SHAREHOLDER'S ACCOUNT AND OFFSET AGAINST ANY UN-
DISTRIBUTED DIVIDENDS AND CAPITAL GAIN DISTRIBUTIONS. THE FUND ALSO RESERVES
THE RIGHT TO CLOSE ANY ACCOUNT WHICH DOES NOT HAVE A CERTIFIED TAXPAYER IDENTI-
FICATION NUMBER.
SHAREHOLDER INFORMATION
Shareholders will be sent reports quarterly regarding the Fund. General in-
formation about the Fund may be requested by writing the Corporate
Communications/Investor Relations Department, J. & W. Seligman & Co. Incorpo-
rated, 100 Park Avenue, New York, New York 10017 or by telephoning the Corpo-
rate Communications/Investor Relations Department toll-free by dialing (800)
221-7844 from all continental United States, except New York or (212) 850-1864
in New York State and the Greater New York City area. Information about share-
holder accounts may be requested by writing Shareholder Services, Seligman Data
Corp. at the same address or by toll-free telephone by dialing (800) 221-2450
from all continental United States. Seligman Data Corp. may be telephoned
Monday through Friday (except holidays), between the hours of 8:30 a.m. and
5:30 p.m. Eastern time, and calls will be answered by service representatives.
24 HOUR TELEPHONE ACCESS IS AVAILABLE BY DIALING 1-800-622-4597 ON A
TOUCHTONE PHONE, WHICH PROVIDES INSTANT ACCESS TO PRICE, YIELD, ACCOUNT BAL-
ANCE, MOST RECENT TRANSACTION AND OTHER INFORMATION. IN ADDITION, ACCOUNT
STATEMENTS, FORM 1099-DIVS AND CHECKBOOKS CAN BE ORDERED. TO INSURE PROMPT DE-
LIVERY OF CHECKS, ACCOUNT STATEMENTS AND OTHER INFORMATION, SELIGMAN DATA CORP.
SHOULD BE NOTIFIED IMMEDIATELY IN WRITING OF ANY ADDRESS CHANGE. ADDRESS
CHANGES MAY BE TELEPHONED TO SELIGMAN DATA CORP. IF THE SHAREHOLDER HAS ELECTED
TELEPHONE SERVICES. FOR MORE INFORMATION ABOUT TELEPHONE SERVICES, SEE "TELE-
PHONE TRANSACTIONS" ABOVE.
ACCOUNT SERVICES. Shareholders are sent confirmation of financial transac-
tions in their Account.
Other investor services are available. These include:
. INVEST-A-CHECK (R) SERVICE enables a shareholder to authorize checks to
be drawn on a regular checking account at regular monthly intervals
21
<PAGE>
in fixed amounts of $100 or more, or regular quarterly intervals in fixed
amounts of $250 or more, to purchase Class A shares. (See "Terms and Condi-
tions" on page 24.)
. AUTOMATIC DOLLAR-COST-AVERAGING SERVICE permits a shareholder to exchange
a specified amount, at regular monthly intervals in fixed amounts of $100
or more, or regular quarterly intervals in fixed amounts of $250 or more,
from Class A shares of the Fund into Class A shares of any other Seligman
Mutual Fund(s) registered in the same name. The shareholder's account must
have a value of at least $5,000 at the initiation of the service. Exchanges
will be made at the public offering price.
. DIVIDENDS FROM OTHER INVESTMENTS permits a shareholder to order dividends
payable on shares of other companies to be paid to and invested in addi-
tional shares of the Fund. (Dividend checks must meet or exceed the re-
quired minimum purchase amount and include the shareholder's name, the name
of the Fund and the class of shares in which the investment is to be made
and the shareholder's Fund account number.)
. AUTOMATIC CD TRANSFER SERVICE permits a shareholder to instruct a bank to
invest the proceeds of a maturing bank certificate of deposit ("CD") in
shares of any designated Seligman Mutual Fund. Shareholders who wish to use
this service should contact Seligman Data Corp. or a broker to obtain the
necessary documentation. Banks may charge a penalty on CD assets withdrawn
prior to maturity. Accordingly, it will not normally be advisable to liqui-
date a CD before its maturity.
. PAYMENTS AT REGULAR INTERVALS can be made to a shareholder who owns or
purchases Class A shares worth $5,000 or more held as book credits under
the Automatic Cash Withdrawal Service. Holders of Class D shares may elect
to use this service with respect to shares that have been held for at least
one year. (See "Terms and Conditions" on page 24.)
. DIRECTED DIVIDENDS allows a shareholder to pay dividends to another per-
son or to direct the payment of such dividends to another mutual fund in
the Seligman Group for purchase at net asset value. Dividends on Class A
and Class D shares may only be directed to shares of the same class of an-
other mutual fund in the Seligman Group.
. OVERNIGHT DELIVERY to service shareholder requests is available for a
$15.00 fee which may be deducted from a shareholder's account, if request-
ed.
. COPIES OF ACCOUNT STATEMENTS will be sent to each shareholder free of
charge for the current year and most recent prior year. Copies of year-end
statements for prior years back to 1982 are available for a fee of $10.00
per year, per account, with a maximum charge of $150 per account. Statement
requests should be forwarded, along with a check to Seligman Data Corp.
TAX-DEFERRED RETIREMENT PLANS. Shares of the Fund may be purchased for all
types of tax-deferred retirement plans. SFSI makes available plans, plan forms
and custody agreements for:
--Individual Retirement Accounts (IRAs);
--Simplified Employee Pension Plans (SEPs);
--Section 401(k) Plans for corporations and their employees;
--Section 403(b)(7) Plans for employees of public school systems and certain
non-profit organizations who wish to make deferred compensation arrangements;
and
--Pension and Profit Sharing Plans for sole proprietorships, corporations and
partnerships.
These types of plans may be established only upon receipt of a written appli-
cation form.
For more information, write Retirement Plan Services, Seligman Data Corp.,
100 Park Avenue, New
22
<PAGE>
York, New York 10017. You may telephone toll-free by dialing (800) 445-1777
from all continental United States or you may receive information through an
authorized dealer.
ADVERTISING THE FUND'S PERFORMANCE
From time to time the Fund advertises its "total return" and "average annual
total return", each of which are calculated separately for Class A and Class D
shares. THESE FIGURES ARE BASED ON HISTORICAL EARNINGS AND ARE NOT INTENDED TO
INDICATE FUTURE PERFORMANCE. The "total return" shows what an investment in
shares of Class A or Class D of the Fund would have earned over a specified pe-
riod of time (for example, one, five and ten year periods or since inception)
assuming the payment of the maximum sales load, if any, when the investment was
made and that all distributions and dividends paid by the Fund were reinvested
on the reinvestment dates during the period. The "average annual total return"
is the annual rate required for the initial payment to grow to the amount which
would be received at the end of the specified period (one, five and ten year
periods or since inception); i.e., the average annual compound rate of return.
The total return and average annual total return of Class A shares quoted from
time to time through December 31, 1992 have not been adjusted to reflect the
deduction of the administration, shareholder services and distribution fee,
which if reflected would reduce the performance quoted. Total return and aver-
age annual total return may also be presented without the effect of the initial
sales load or CDSL, as applicable.
From time to time, reference may be made in advertising or promotional mate-
rial to performance information, including mutual fund rankings, prepared by
Lipper Analytical Service, Inc. ("Lipper"), an independent reporting service
which monitors the performance of mutual funds. In calculating the total return
of the Fund's Class A and Class D shares, the Lipper analysis assumes invest-
ment of all dividends and distributions paid but does not take into account ap-
plicable sales loads. The Fund may also refer in advertisements or in other
promotional material to articles, comments listings and columns in the finan-
cial press pertaining to the Fund's performance. Examples of such financial and
other press publications include Barron's, Business Week, CDA/Weisenberger Mu-
tual Funds Investment Report, Christian Science Monitor, Financial Planning,
Financial Times, Financial World, Forbes, Fortune, Individual Investor, Invest-
ment Advisor, Investors Business Daily, Kiplinger's, Los Angeles Times, MONEY
Magazine, Morningstar, Inc., Pensions and Investments, Smart Money, The New
York Times, USA Today, U.S. News and World Report, The Wall Street Journal,
Washington Post, Worth Magazine and Your Money.
ORGANIZATION AND CAPITALIZATION
The Fund is an open-end diversified management investment company incorpo-
rated under the laws of the state of Maryland in 1982. The Fund is authorized
to issue 100 million shares of common stock, each with a par value of $0.10,
divided into two classes. Each share of the Fund's Class A and Class D common
stock is equal as to earnings, assets and voting privileges, except that each
class bears its own separate distribution and certain other class expenses and
has exclusive voting rights with respect to any matter to which a separate vote
of any class is required by the 1940 Act or Maryland law. The Fund has received
an order from the Securities and Exchange Commission permitting the issuance
and sale of multiple classes of common stock. In accordance with the Articles
of Incorporation, the Board of Directors may authorize the creation of addi-
tional classes of common stock with such characteristics as are permitted by
the order received from the Securities and Exchange Commission. The 1940 Act
requires that where more than one class exists, each class must be preferred
over all other classes in respect of assets specifically allocated to such
class. Shares have non-cumulative voting rights, do not have preemptive or sub-
scription rights and are transferable.
23
<PAGE>
TERMS AND CONDITIONS
GENERAL ACCOUNT INFORMATION
Investments will be made in as many shares, including fractions to the third
decimal place, as can be purchased at the net asset value plus a sales load,
if applicable, at the close of business on the day payment is received. If a
check in payment of a purchase of Fund shares is dishonored for any reason,
Seligman Data Corp. will cancel the purchase and may redeem additional shares,
if any, held in a shareholder's account in an amount sufficient to reimburse
the Fund for any loss it may have incurred and charge a $10.00 return check
fee. Shareholders will receive dividends from investment income and any dis-
tributions from gain realized on investments in shares or in cash according to
the option elected. Dividend and gain options may be changed by notifying Se-
ligman Data Corp. in writing. These option changes must be received by Selig-
man Data Corp. on or before the record date for the dividend or distribution
in order to be effective for that dividend or distribution. Stock certificates
will not be issued, unless requested. Replacement Stock certificates will be
subject to a surety fee.
INVEST-A-CHECK(R) SERVICE
The Invest-A-Check(R) Service is available to all shareholders. The applica-
tion is subject to acceptance by the shareholder's bank and Seligman Data
Corp. Checks in the amount specified will be drawn automatically on the share-
holder's bank on the fifth day of each month (or on the prior business day if
the fifth day of the month falls on a weekend or holiday) in which an invest-
ment is scheduled and invested at the public offering price at the close of
business on the same date. After the initial investment, the value of shares
held in the shareholder's account must equal not less than two regularly
scheduled investments. If a check is not honored by the shareholder's bank, or
if the value of shares held falls below the required minimum, the Service will
be suspended. In the event that a check is returned marked "unpaid," Seligman
Data Corp. will cancel the purchase, redeem shares held in the shareholder's
account for an amount sufficient to reimburse the Fund for any loss it may
have incurred as a result, and charge a $10.00 return check fee. This fee may
be debited to the shareholder's account. The Service will be reinstated upon
written request indicating that the cause of interruption has been corrected.
The Service may be terminated by the shareholder or Seligman Data Corp. at any
time by written notice. The shareholder agrees to hold the Fund and its agents
free from all liability which may result from acts done in good faith and pur-
suant to these terms. Instructions for establishing Invest-A-Check(R) Service
are given on the Account Application. In the event a shareholder exchanges all
of the shares from one mutual fund in the Seligman Group to another, a share-
holder must re-apply for the Invest-A-Check(R) Service in the Seligman Fund
into which the exchange was made. In the event of a partial exchange, the In-
vest-A-Check(R) Service will be continued, subject to the above conditions, in
the Seligman Fund from which the exchange was made. If a shareholder uses the
Invest-A-Check(R) Service to make an IRA investment, the purchase will be
credited as a current year contribution. If a shareholder uses the Invest-A-
Check(R) Service to make an investment in a pension or profit sharing plan,
the purchase will be credited as a current year employer contribution.
AUTOMATIC CASH WITHDRAWAL SERVICE
Automatic Cash Withdrawal Service is available to Class A shareholders and
to Class D shareholders with respect to Class D shares held for one year or
more. A sufficient number of full and fractional shares will be redeemed to
provide the amount required for a scheduled payment. Redemptions will be made
at the asset value at the close of business on the specific day designated by
the shareholder of each month (or on the prior business day if the day speci-
fied falls on a weekend or holiday). A shareholder may change the amount of
scheduled payments or may suspend payments by written notice to Seligman Data
Corp. at least ten days prior to the effective date of such a change or sus-
pension. Service may be terminated by the shareholder or Seligman Data Corp.
at any time by written notice. It will be terminated upon proper notification
of the death or legal incapacity of the shareholder. This Service is consid-
ered terminated in the event a withdrawal of shares, other than to make sched-
uled withdrawal payments, reduces the value of shares remaining on deposit to
less than $5,000. Continued payments in excess of dividend income invested
will reduce and ultimately exhaust capital. Withdrawals, concurrent with pur-
chases of shares of this or any other investment company, will be disadvanta-
geous because of the payment of duplicative sales loads, if applicable. For
this reason, additional purchases of Fund shares are discouraged when the
Withdrawal Service is in effect.
LETTER OF INTENT--CLASS A SHARES ONLY
Seligman Financial Services, Inc. will hold in escrow shares equal to 5% of
the minimum purchase amount specified. Dividends and distributions on the
escrowed shares will be paid to the shareholder or credited to their account.
Upon completion of the specified minimum purchase within the thirteen-month
period, all shares held in escrow will be deposited to the shareholder's ac-
count or delivered to the shareholder. A shareholder may include the total as-
set value of shares of the mutual funds in the Seligman Group on which a sales
load was paid owned as of the date of a Letter of Intent toward the completion
of the Letter. If the total amount invested within the thirteen-month period
does not equal or exceed the specified minimum purchase, a shareholder will be
requested to pay the difference between the amount of the sales load paid and
the amount of the sales load applicable to the total purchase made. If, within
20 days following the mailing of a written request, a shareholder has not paid
this additional sales load to Seligman Financial Services, sufficient escrowed
shares will be redeemed for payment of the additional sales load. Shares re-
maining in escrow after this payment will be released to the account. The in-
tended purchase amount may be increased at any time during the thirteen-month
period by filing a revised Agreement for the same period, provided that the
Dealer furnishes evidence that an amount representing the reduction in sales
load under the new Agreement, which becomes applicable on purchases already
made under the original Agreement, will be refunded to the shareholder and
that the required additional escrowed shares are being furnished by the share-
holder.
Shares of Seligman Cash Management Fund which have been acquired by an ex-
change of shares of another mutual fund in the Seligman Group on which there
is a sales load may be taken into account in completing a Letter of Intent, or
for Rights of Accumulation. However, shares of this Fund which have been pur-
chased directly may not be used for purposes of determining reduced sales
loads on additional purchases of the other mutual funds in the Seligman Group.
Rev. 5/95
24
<PAGE>
<TABLE>
<CAPTION>
THE SELIGMAN GROUP OF FUNDS
ACCOUNT APPLICATION
Please make your investment check payable to the
"Seligman Group of Funds" and mail it
with this completed Application to:
Seligman Data Corp. TO OPEN A SELIGMAN IRA, SEP OR PENSION/
100 Park Avenue/2nd Floor PROFIT SHARING PLAN, A SEPARATE ADOPTION
New York, NY 10017 AGREEMENT IS REQUIRED. PLEASE CALL
(800) 221-2450 RETIREMENT PLAN SERVICES FOR MORE
INFORMATION AT (800) 445-1777.
<S> <C> <C> <C>
1. ACCOUNT REGISTRATION
TYPE OF ||INDIVIDUAL ||MULTIPLE OWNERS ||GIFT/TRANSFER TO MINOR ||OTHER (Corporations, Trusts, Organizations,
Partnerships, etc.)
ACCOUNT Use Line 1 Use Lines 1, 2 & 3 Use Line 4 Use Line 5 Multiple Owners
will be registered as Joint Tenants with Right of Survivorship.
The first name and Social Security or Taxpayer ID Number on line 1, 4, or 5
below will be used for IRS reporting. NAME (Minors cannot be legal owners)
PLEASE PRINT OR TYPE
1._______________________________________________________________ ___________________________ _________
First Middle Last Social Security Number Birthdate
2._______________________________________________________________ ___________________________ _________
First Middle Last Social Security Number Birthdate
3._______________________________________________________________ ___________________________ _________
First Middle Last Social Security Number Birthdate
4.______________________________, as custodian for ____________________ under the _______________
Custodian (one only) Minor (one only) State
Uniform Gift/Transfer to Minors Act_______________________________until age____________________ _________________
Minor's Social Security Number (Not more than 21) Minor's Birthdate
5._______________________________________________________________________ _____________________
Name of Corporation or Other Entity. If a Trust, also complete below. Taxpayer ID Number
TYPE OF TRUST ACCOUNT: ||Trust ||Guardianship ||Conservatorship ||Estate ||Other
Trustee/Fiduciary Name__________________________________ Trust Date__________________________
Trust Name ______________________________,for the benefit of (FBO)_______________________________
2. MAILING ADDRESS
ADDRESS TELEPHONE
___________________________________________ (_______)__________________(_______)_________________
Street Address or P.O. Box Daytime Evening
___________________________________________ U.S. CITIZEN? ||Yes ||No _________________________
City State Zip If no, indicate country
3. INVESTMENT SELECTION
Please indicate the dollar amount(s) you would like to invest in the space
provided below. Minimum initial investment is $1,000 per Fund except for
accounts established pursuant to the Invest-A-Check(R) Service (see section
6-I. of this application). IF MORE THAN ONE FUND IS SELECTED, ACCOUNTS MUST
HAVE IDENTICAL REGISTRATIONS AND CLASS OF SHARES (except for Seligman Cash
Management Fund). PLEASE CHOOSE ONE: || Class A Shares || Class D Shares
MAKE CHECK PAYABLE TO: SELIGMAN GROUP OF FUNDS
$_____________ TOTAL AMOUNT,
INVESTED AS FOLLOWS:
$_____________ *Seligman Communications $_____________ Seligman Common Stock Fund
and Information Fund $_____________ Seligman Income Fund
$_____________ Seligman Henderson $_____________ Seligman High-Yield Bond Fund
Global Technology Fund $_____________ Seligman U.S. Government Securities Fund
$_____________ Seligman Frontier Fund $_____________ Seligman National Tax-Exempt Fund
$_____________ Seligman Henderson Global $_____________ Seligman Tax-Exempt Fund (choose one):
Smaller Companies Fund CA-Qlty.|| FL|| MD|| MN|| NY|| OR||
$_____________ Seligman Capital Fund CA-Hy. || GA|| MA|| MO|| NC|| PA||
$_____________ Seligman Growth Fund CO || LA|| MI|| NJ|| OH|| SC||
$_____________ Seligman Henderson
International Fund $_____________ Seligman Cash Management Fund (Class A only)
*Closed indefinitely to new investors after June 30, 1995; please contact
your financial advisor for information on current availability. NO
REDEMPTION PROCEEDS WILL BE REMITTED TO A SHAREHOLDER WITH RESPECT TO
SHARES PURCHASED BY CHECK (UNLESS CERTIFIED) UNTIL SELIGMAN DATA CORP.
RECEIVES NOTICE THAT THE CHECK HAS CLEARED, WHICH MAY BE UP TO 15 DAYS FROM
THE CREDIT OF THE SHARES TO THE SHAREHOLDER'S ACCOUNT.
4. SIGNATURE AND CERTIFICATION
Under penalties of perjury I certify that the number shown on this form is
my correct Taxpayer Identification Number (Social Security Number) and that
I am not subject to backup withholding either because I have not been
notified that I am subject to backup withholding as a result of a failure
to report all interest or dividends, or the Internal Revenue Service has
notified me that I am no longer subject to backup withholding. I certify to
my legal capacity to purchase or redeem shares of each Fund for my own
Account, or for the Account of the organization named below. I have
received and read the current Prospectus of each Fund in which I am
investing and appoint Seligman Data Corp. as my agent to act in accordance
with my instructions herein.
A. ________________________________________________________________________
Date Signature of Investor
B. ________________________________________________________________________
Date Signature of Co-Investor, if any
5. BROKER/DEALER OR FINANCIAL ADVISOR DESIGNATION
________________________________________ _____________________________
Firm Name Representative's Nam
________________________________________ _____________________________
Branch Office Address Representative's ID Number
________________________________________ (______)_____________________
City State Zip Representative's Telephone Number
________________________________________
Branch Number
</TABLE>
<PAGE>
<TABLE>
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6. ACCOUNT OPTIONS AND SERVICES
________________________________________________________________________________
A. DIVIDENDS AND GAIN DISTRIBUTION OPTIONS
I choose the following options for each Fund listed: OPTION
------
1 2 3
Option 1. Dividends in shares, gain distributions in shares. || || || FUND NAME
Option 2. Dividends in cash, gain distributions in shares. || || || FUND NAME
Option 3. Dividends in cash, gain distributions in cash. || || || FUND NAME
__________________________________________________________________________________________
NOTE: IF NO ELECTION IS MADE, OPTION 1. WILL AUTOMATICALLY BE PUT INTO EFFECT.
All dividend and/or gain distributions taken in shares will be invested at net asset value.
__________________________________________________________________________________________
________________________________________________________________________________
B. DIVIDEND DIRECTION OPTION
If you wish to have your dividend payments made to another
party or Seligman Fund, please complete the following. I
hereby authorize and request that my dividend payments from
the following Fund(s)
__________________ __________________ __________________ be made payable to:
Fund Name Fund Name Fund Name
Name______________________ Seligman Fund__________________
Address___________________ (If opening a new account, a minimum of $1,000 is required.)
City______________________ Account Number_________________
State, Zip________________ (For an existing account.)
________________________________________________________________________________
C. LETTER OF INTENT SERVICE (CLASS A ONLY)
I intend to purchase, although I am not obligated to do so,
additional shares of Seligman _________________________
Fund within a 13-month period which, together with the
total asset value of shares owned, will aggregate at least:
||$50,000 ||$100,000 ||$250,000 ||$500,000 ||$1,000,000
||$4,000,000
I AGREE TO THE ESCROW PROVISION LISTED UNDER "TERMS AND CONDITIONS"
IN THE BACK OF EACH PROSPECTUS.
________________________________________________________________________________
D. RIGHT OF ACCUMULATION (CLASS A ONLY)
Please identify any additional Seligman Fund accounts
eligible for the Right of Accumulation or to be used toward
completion of a Letter of Intent, and check applicable box:
|| I am a trustee for the following accounts, which are
held by the same trust, estate, or under the terms of a
pension, profit sharing or other employee benefit trust
qualified under section 401 of the Internal Revenue Code.
|| In calculating my holdings for Right of Accumulation or
Letter of Intent purposes, I am including the following
additional accounts which are registered in my name, in my
spouse's name, or in the name(s) of my child(ren) under
the age of 21.
Name______________ Fund______________ Account#_____________
Name______________ Fund______________ Account#_____________
Name______________ Fund______________ Account#_____________
________________________________________________________________________________
E. AUTOMATIC CASH WITHDRAWAL SERVICE
(CLASS A, OR CLASS D ONLY AFTER CLASS D SHARES ARE HELD FOR ONE YEAR)
Please send a check for $ withdrawn from Seligman
________________________ Fund, beginning on the day of 19,
and thereafter on the day specified of every:
||Month ||3rd Month ||6th Month ||12th Month
Make payments to: Name___________________________________
Address________________________________
City___________State________Zip________
Shares having a current value at offering price of $5,000
or more must be held in the account at initiation of
Service, and all shares must be in "book credit" form.
________________________________________________________________________________
F. AUTOMATIC DOLLAR-COST-AVERAGING SERVICE
I authorize Seligman Data Corp. to withdraw $ _____________
(minimum: $100 monthly or $250 quarterly) from my Seligman
Cash Management Fund Class A account || Monthly or
|| Quarterly to purchase Class A shares of Seligman
________________________________ Fund, beginning on the
_____ day of __________ 19 ____. Shares in the Seligman
Cash Management Fund Class A account must have a current
value of $5,000 at the initiation of Service and all shares
must be in "book credit" form.
________________________________________________________________________________
G. EXPEDITED REDEMPTION SERVICE, FOR SELIGMAN CASH MGMT. FUND ONLY
I hereby authorize Seligman Data Corp. to honor telephone
or written instructions received from me without a
signature and believed by Seligman Data Corp. to be genuine
for redemption. Proceeds will be wired ONLY to the
commercial bank listed below for credit to my account, or
to my address of record. If Expedited Redemption Service is
elected, no certificates for shares will be issued. I also
understand and agree to the risks and procedures outlined
for all telephone transactions set forth in section 6-H. of
this Application.
Investment by ||Check ______________________________________________________________________
||Wire Name of Commercial Bank (Savings Bank May Not Be Used)
_________________________ ______________________ ______________________
Bank Account Name Bank Account No. Bank Routing No.
_______________________________________________________________________________________
Address of Bank City State Zip Code
X________________________________ X____________________________________________
Signature of Investor Date Signature of Co-Investor, if any Date
______________________________________________________________________________________________________________________
</TABLE>
<PAGE>
<TABLE>
<S> <C> <C> <C> <C> <C> <C>
H. TELEPHONE SERVICE ELECTION
AVAILABLE FOR INDIVIDUAL OR JOINT TENANT ACCOUNTS ONLY
By completing this section, I understand that I may place
the following requests by telephone:
o Redemptions up to $50,000 o Exchanges
o Address Changes o Dividend and/or Capital
Gain Distribution Option
changes
AUTHORIZATION
I understand that the telephone services are optional and
that by signing below I authorize the Funds, all other
Seligman Funds with the same account number and
registration which I currently own or in which I invest in
the future, and Seligman Data Corp. ("SDC"), to act upon
instructions received by telephone from me or any other
person in accordance with the provisions regarding
telephone services as set forth in the current prospectus
of each such Fund, as amended from time to time. I
understand that redemptions of uncertificated shares of up
to $50,000 will be sent only to my account address of
record, and only if such address has not changed within the
30 days preceding such request. Any telephone instructions
given in respect of this account and any account into which
exchanges are made are hereby ratified and I agree that
neither the Fund(s) nor SDC will be liable for any loss,
cost or expense for acting upon such telephone instructions
reasonably believed to be genuine and in accordance with
the procedures described in each prospectus, as amended
from time to time. Such procedures include recording of
telephone instructions, requesting personal and/or account
information to verify a caller's identity and sending
written confirmations of transactions. As a result of this
policy, I may bear the risk of any loss due to unauthorized
or fraudulent telephone instructions; provided, however,
that if the Fund(s) or SDC fail to employ such procedures,
the Fund(s) and/or SDC may be liable. TO ELECT TELEPHONE
SERVICES, PLEASE SIGN YOUR NAME(S) AS IT APPEARS ON THE
FIRST PAGE OF THIS ACCOUNT APPLICATION.
X________________________________ X____________________________________
Signature of Investor Date Signature of Co-Investor, if any Date
</TABLE>
<PAGE>
<TABLE>
<S> <C> <C> <C> <C> <C> <C>
I. INVEST-A-CHECK(R) SERVICE
To start your Invest-A-Check(R) Service, fill out the "Bank
Authorization to Honor Pre-Authorized Checks" below, and
forward it with an unsigned bank check from your regular
checking account (marked "void", if you wish). Please
arrange with my bank to draw pre-authorized checks and
invest the following dollar amounts (minimum: $100 monthly
or $250 quarterly) in the designated Seligman Fund(s) as
indicated:
_______________ $_________ ||Monthly ||Quarterly
Fund Name
________________ $_________ ||Monthly ||Quarterly
Fund Name
________________ $_________ ||Monthly ||Quarterly
Fund Name
I understand that my checks will be drawn on the fifth day
of the month, or prior business day, for the period
designated. I have completed the "Bank Authorization to
Honor Pre-Authorized Checks" below and have read and agree
to the Terms and Conditions applicable to the
Invest-A-Check(R) Service as set forth in each Prospectus
and as set forth below in the Bank Authorization.
X__________________________________________________________________
Signature of Investor (Please also sign Bank Authorization below.)
X__________________________________________________________________
Signature of Co-Investor, if any
________________________________________________________________________________________
BANK AUTHORIZATION TO HONOR PRE-AUTHORIZED CHECKS
________________________________________________________________________________________
To:_____________________________________________________________________________________
(Name of Bank)
________________________________________________________________________________________
Address of Bank or Branch (Street, City, State and Zip)
Please honor pre-authorized checks drawn on my account by Seligman Data Corp.,
100 Park Avenue, New York, N.Y. 10017, to the order of the Fund(s) designated
below:
____________________________________ $ ___________ ||Monthly ||Quarterly
Fund Name
____________________________________ $ ___________ ||Monthly ||Quarterly
Fund Name
____________________________________ $ ___________ ||Monthly ||Quarterly
Fund Name
and charge them to my regular checking account. Your authority to do so shall
continue until you receive written notice from me revoking it. You may
terminate your participation in this arrangement at any time by written notice
to me. I agree that your rights with respect to each pre-authorized check
shall be the same as if it were a check drawn and signed by me. I further
agree that should any such check be dishonored, with or without cause,
intentionally or inadvertently, you shall be under no liability whatsoever.
___________________________________ _________________________________________________
Checking Account Number Name(s) of Depositor(s) -- Please Print
X__________________________________________________
Signature(s) of Depositor(s) -- As Carried by Bank
X__________________________________________________
________________________________________________________________________________________
Address (Street) (City) (State, Zip)
________________________________________________________________________________________
To the Bank Designated above:
Your depositor(s) named in the above form has instructed us to establish the
Invest-A-Check(R) Service for his convenience. Under the terms of the Service,
your depositor(s) has pre-authorized checks to be drawn against his account in
a specific amount at regular intervals to the order of the designated Fund(s).
Checks presented to you will be magnetic-ink coded and will otherwise conform
to specifications of the American Bankers Association. A letter of
indemnification addressed to you and signed by Seligman Financial Services,
Inc., general distributor of the Seligman Mutual Funds, appears below. If
there is anything we can do to help you in giving your depositor(s) this
additional Service which he has requested, please let us know.
SELIGMAN DATA CORP.
INDEMNIFICATION AGREEMENT
To the Bank designated above:
SELIGMAN FINANCIAL SERVICES, INC., distributor of the shares of the Seligman
Mutual Funds, hereby agrees:
(1) To indemnify and hold you harmless against any loss, damage, claim or
suit, and any costs or expenses reasonably incurred in connection therewith,
either (a) arising as a consequence of your actions in connection with the
execution and issuance of any check or draft, whether or not genuine,
purporting to be executed by Seligman Data Corp. and received by you in the
regular course of business for the purpose of payment, or (b) resulting from
the dishonor of any such check or draft, with or without cause and
intentionally or inadvertently, even though such dishonor results in
suspension or termination of the Invest-A-Check(R) Service pursuant to which
such checks or drafts are drawn. (2) To refund to you any amount erroneously
paid by you on any such check or draft, provided claim for any such payment is
made within 12 months after the date of payment.
SELIGMAN FINANCIAL SERVICES, INC.
/S/Stephen J. Hodgdon
President
________________________________________________________________________________
</TABLE>
<PAGE>
J. CHECK REDEMPTION SERVICE (CLASS A ONLY)
Available to shareholders who own or purchase shares having
a value of at least $25,000 invested in any of the
following: Seligman High-Yield Bond Fund, Seligman Income
Fund, Seligman U.S. Government Securities Fund, and any
Seligman Tax-Exempt Fund, or $2,000 invested in Seligman
Cash Management Fund. IF YOU WISH TO USE THIS SERVICE, YOU
MUST COMPLETE SECTION 4 AND THE SIGNATURE CARD BELOW.
SHAREHOLDERS ELECTING THIS SERVICE ARE SUBJECT TO THE
CONDITIONS OF THE TERMS AND CONDITIONS IN THE BACK OF EACH
PROSPECTUS.
CHECK WRITING SIGNATURE CARD Authorized Signature(s)
___________________________________________ 1.______________________________
Name of Fund for Check Redemption Service
___________________________________________ 2.______________________________
Name of Fund for Check Redemption Service
___________________________________________ 3.______________________________
Name of Fund for Check Redemption Service
__________________________________________ 4.______________________________
Account Number (If known)
__________________________________________ 5.______________________________
Account Registration (Please Print)
|| Check here if only one signature is required on checks.
|| Check here if a combination of signatures is required and specify the
number:___________________.
ACCOUNTS IN THE NAMES OF CORPORATIONS, TRUSTS, PARTNERSHIPS, ETC., MUST
INDICATE THE LEGAL TITLES OF ALL AUTHORIZED SIGNATORIES. SHAREHOLDERS
ELECTING THIS SERVICE ARE SUBJECT TO THE TERMS AND CONDITIONS LISTED IN THE
PROSPECTUS.
<PAGE>
MANAGED BY
[J&W SELIGMAN LOGO]
J. & W. SELIGMAN & CO.
INCORPORATED
Investment Managers and Advisors
ESTABLISHED 1864
JWS23 5/95
<PAGE>
SELIGMAN -------------------
P R O S P E C T U S
COMMUNICATIONS
AND INFORMATION [LOGO OF SELIGMAN
COMMUNICATIONS AND
FUND, INC. INFORMATION FUND,
INC. GOES HERE]
- -----------------------
100 Park Avenue
New York, New York 10017
INVESTMENT MANAGER
J. & W. Seligman & Co. Incorporated
100 Park Avenue
New York, New York 10017
GENERAL DISTRIBUTOR
Seligman Financial Services, Inc.
100 Park Avenue
New York, New York 10017
SHAREHOLDER SERVICE AGENT
Seligman Data Corp. MAY 1, 1995
100 Park Avenue
New York, New York 10017
PORTFOLIO SECURITIES CUSTODIAN [LOGO OF SELIGMAN
Investors Fiduciary Trust Company COMMUNICATIONS AND
127 West 10th Street INFORMATION FUND,
Kansas City, Missouri 64105 INC. GOES HERE]
GENERAL COUNSEL -------------------
Sullivan & Cromwell A Capital Gain Fund
125 Broad Street In its 13th Year
New York, New York, 10004
<PAGE>
STATEMENT OF ADDITIONAL INFORMATION
MAY 1, 1995
SELIGMAN COMMUNICATIONS AND INFORMATION FUND, INC.
100 Park Avenue
New York, New York 10017
New York City Telephone (212) 850-1864
Toll Free Telephone (800) 221-2450 all continental United States
For Retirement Plan Information - Toll Free Telephone (800) 445-1777
This Statement of Additional Information expands upon and supplements
the information contained in the current Prospectus of Seligman Communications
and Information Fund, Inc., (the "Fund") dated May 1, 1995. It should be read
in conjunction with the Prospectus, which may be obtained by writing or calling
the Fund at the above address or telephone numbers. This Statement of
Additional Information, although not in itself a Prospectus, is incorporated by
reference into the Prospectus in its entirety.
The Fund offers two classes of shares. Class A shares may be
purchased at net asset value plus a sales load of up to 4.75%. Class D shares
may be purchased at net asset value and are subject to a contingent deferred
sales load ("CDSL") of 1% if redeemed within one year.
Each Class A and Class D share represents an identical legal interest
in the investment portfolio of the Fund and has the same rights except for
certain class expenses and except that Class D shares bear a higher distribution
fee that generally will cause the Class D shares to have a higher expense ratio
and pay lower dividends than Class A shares. Each Class has exclusive voting
rights with respect to its distribution plan. Although holders of Class A and
Class D shares have identical legal rights, the different expenses borne by each
Class will result in different net asset values and dividends. The two classes
also have different exchange privileges.
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page Page
<S> <C> <C> <C>
Investment Objectives, Policies And Risks.....2 Purchase And Redemption of Fund Shares.....10
Investment Limitations........................3 Distribution Services......................12
Directors And Officers........................4 Valuation..................................13
Management And Expenses.......................7 Performance................................13
Administration, Shareholder Services And General Information........................15
Distribution Plan.............................9 Financial Statements.......................15
Portfolio Transactions........................9 Appendix...................................16
</TABLE>
EQCI1A
-1-
<PAGE>
INVESTMENT OBJECTIVES, POLICIES AND RISKS
As stated in the Prospectus, the Fund seeks to produce capital gain by
investing in a portfolio consisting of securities of domestic and foreign
companies operating in virtually all aspects of the communications, information
and related industries.
Illustrative subsegments of these industries include:
. Advertising
. Broadcasting and Entertainment
. Cellular Radio
. Computer-Aided Design and Manufacturing
. Computer Graphics and Software
. Local Networking and Linkage of Word and Data Processing Systems
. Medical Technology
. Proprietary Databases
. Publishing and Print Media
. Semiconductors
. Specialized Information Services
The Fund may hold securities of smaller, less-seasoned companies. The
disposition of some of the securities held by the Fund may be restricted under
the federal securities laws. Generally, such "restricted securities" may be sold
only in privately negotiated transactions or in public offerings registered
under the Securities Act of 1933. As a result, the Fund may not be able to
dispose of such investments at a time when or at a price at which it desires to
do so and may have to bear expenses of registering these securities, if
necessary. Market value for these securities, if quotations are not readily
available, will be fair value as determined in good faith by the Board of
Directors. The Fund will not invest more than 10% of its net assets in illiquid
securities including restricted securities.
Borrowing. The Fund may from time to time borrow money from banks to increase
- ---------
its portfolio of securities.
Borrowings are subject to any applicable limitations under regulations of
the Federal Reserve Board. Current asset value coverage of three times any
amount borrowed is required at all times. No borrowing occurred in 1994, 1993
and 1992.
Any gain in the value of securities purchased with money borrowed in excess
of the cost of amounts borrowed would cause the net asset value of the Fund's
shares to increase more than otherwise would be the case. Conversely, any
decline in the value of securities purchased with money borrowed or any gain in
value less than the cost of amounts borrowed would cause net asset value to
decline more than would otherwise be the case.
Lending of Portfolio Securities. The Fund may lend portfolio securities to
- -------------------------------
certain institutional borrowers of securities and may invest the cash collateral
and obtain additional income or receive an agreed upon amount of interest from
the borrower. Loans are subject to termination at the option of the Fund or the
borrower. The Fund may pay reasonable administrative and custodial fees in
connection with a loan and may pay a negotiated portion of the interest earned
on the cash or equivalent collateral to the borrower or placing broker. The
Fund does not have the right to vote securities on loan, but would terminate the
loan and regain the right to vote if that were considered important with respect
to the investment.
Rights and Warrants. The Fund may not invest in rights and warrants if, at the
- --------------------
time of acquisition, the investment in rights and warrants would exceed 5% of
the Fund's net assets, valued at the lower of cost or market. In addition, no
more than 2% of net assets may be invested in warrants not listed on the New
York or American Stock Exchanges. For purposes of this restriction, rights and
warrants acquired by the Fund in units or attached to securities may be deemed
to have been purchased without cost.
Repurchase Agreements. The Fund may enter into repurchase agreements with
- ---------------------
commercial banks and with broker/dealers to invest cash for the short-term. A
repurchase agreement is an agreement under which the Fund acquires a money
market instrument, generally a U.S. Government obligation subject to resale at
an agreed upon price and date. Such resale price reflects an agreed upon
interest rate effective for the period of time the instrument is held by the
Fund and is unrelated to the interest rate on the instrument. Repurchase
agreements could involve certain risks in the event of bankruptcy or other
default by the seller, including possible delays and expenses in liquidating the
securities underlying the agreement, decline in value of the underlying
securities and loss of interest. Repurchase agreements usually are for short
periods, such as one
-2-
<PAGE>
week or less, but may be for longer periods. However, as a matter of fundamental
policy, the Fund will not enter into repurchase agreements of more than one
week's duration if more than 10% of its net assets would be so invested. The
Fund has no present intention of entering into repurchase agreements in the
future.
Except as described under "Investment Limitations" below, the foregoing
investment policies are not fundamental and the Board of Directors of the Fund
may change such policies without the vote of a majority of its outstanding
voting securities (as defined on page 4).
Portfolio Turnover. The Fund's portfolio turnover rate is calculated by
- ------------------
dividing the lesser of purchases or sales of portfolio securities for the fiscal
year by the monthly average value of the portfolio securities owned during the
fiscal year. Securities whose maturity or expiration date at the time of
acquisition were one year or less are excluded. The Fund's portfolio turnover
rate was 104.08% in 1994 and 137.10% in 1993.
INVESTMENT LIMITATIONS
Under the Fund's fundamental policies, which cannot be changed except by
vote of a majority of its outstanding voting securities, the Fund may not:
. Borrow money, except in an amount not to exceed one-third of the value of its
total assets less liabilities other than such borrowing; or mortgage or
pledge any of its assets, except to secure permitted borrowings up to 10% of
the value of its total assets (taken at cost);
. Purchase securities on "margin," or sell "short", or participate on a joint
or a joint and several basis in any securities trading account, or write or
purchase put, call, straddle or spread options;
. Invest more than 5% of its total assets (taken at market) in securities of
any one issuer other than the U.S. Government, its agencies or
instrumentalities, buy more than 10% of the voting securities of any issuer,
or invest to control or manage any company;
. Invest more than 25% of the value of its total assets in any one industry,
except that the Fund will invest at least 25% of the value of its total
assets in securities of companies principally engaged in the communications,
information and related industries, except when investing for temporary
defensive purposes;
. Invest in securities issued by other investment companies, except in
connection with a merger, consolidation, acquisition or reorganization;
. Purchase or sell commodities and commodity contracts or purchase or hold real
estate;
. Purchase or hold the securities of any issuer, if to its knowledge, directors
or officers of the Fund individually owning beneficially more than 0.5% of
the securities of that issuer own in the aggregate more than 5% of such
securities;
. Underwrite the securities of other issuers, except insofar as the Fund may
be deemed an underwriter under the Securities Act of 1933, as amended, in
disposing of a portfolio security; or
. Make loans, except loans of portfolio securities and except to the extent
the purchase of notes, bonds or other evidences of indebtedness, or the entry
into repurchase agreements may be considered loans.
Although not fundamental policies subject to shareholder vote, as long as the
Fund's shares are registered in certain states, it may not (1) mortgage, pledge
or hypothecate its assets to the extent that the value of such encumbered assets
exceed 10% of the per share offering price of shares of the Fund; (2) invest in
interests in oil, gas or other mineral exploration or development programs; and
(3) invest more than 5% of its gross assets at market value in combined
investments in securities of companies in operation for less than three years
(excluding securities guaranteed by a company which, including predecessors, has
been in operation at least three continuous years). Also, in accordance with
Texas securities regulations, purchase or sell real property or limited
partnership interests in real property (but excluding readily marketable
interests in real estate investment trusts or readily marketable securities of
companies which invest in real estate).
Under the Investment Company Act of 1940 (the "1940 Act"), a "vote of a
majority of the outstanding voting securities"
-3-
<PAGE>
of the Fund means the affirmative vote of the lesser of (l) more than 50% of the
outstanding shares of the Fund or (2) 67% or more of the shares present at a
shareholders' meeting if more than 50% of the outstanding shares are represented
at the meeting in person or by proxy.
DIRECTORS AND OFFICERS
Directors and officers of the Fund, together with information as to their
principal business occupations during the past five years, are shown below.
Each Director who is an "interested person" of the Fund, as defined in the 1940
Act, is indicated by an asterisk. Unless otherwise indicated, their addresses
are 100 Park Avenue, New York, NY 10017.
WILLIAM C. MORRIS*
(56)
Director, Chairman of the Board, Chief Executive
Officer and Chairman of the Executive Committee
Managing Director, Chairman and President, J. & W.
Seligman & Co. Incorporated, investment managers and
advisors; and Seligman Advisors, Inc., advisors;
Chairman and Chief Executive Officer, the Seligman
Group of Investment Companies; Chairman, Seligman
Financial Services, Inc., distributor; Seligman
Holdings, Inc, holding company; Seligman Services,
Inc., broker/dealer; and Carbo Ceramics Inc., ceramic
proppants for oil and gas industry; Director or
Trustee, Seligman Data Corp. (formerly Union Data
Service Center, Inc.), shareholder service agent;
Daniel Industries, Inc., manufacturer of oil and gas
metering equipment; Kerr-McGee Corporation, diversified
energy company; and Sarah Lawrence College; and a
Member of the Board of Governors of the Investment
Company Institute; formerly, Chairman, Seligman
Securities, Inc., broker/dealer; and J. & W. Seligman
Trust Company, trust company.
RONALD T. SCHROEDER*
(47)
Director, President and Member of the Executive
Committee
Director, Managing Director and Chief Investment
Officer, J. & W. Seligman & Co. Incorporated,
investment managers and advisors; Managing Director and
Chief Investment Officer, Seligman Advisors, Inc.,
advisors; Director or Trustee and President and Chief
Investment Officer, Tri-Continental Corporation,
closed-end investment company and the open-end
investment companies in the Seligman Group of
Investment Companies; Director and President, Seligman
Holdings, Inc., holding company; Director, Seligman
Financial Services, Inc., distributor; Seligman Data
Corp., shareholder service agent; Seligman Quality
Municipal Fund, Inc. and Seligman Select Municipal
Fund, Inc., closed-end investment companies; Seligman
Henderson Co., advisors; and Seligman Services, Inc.,
broker/dealer; formerly, Director, J. & W. Seligman
Trust Company, trust company; and Seligman Securities,
Inc., broker/dealer.
FRED E. BROWN*
(81)
Director
Director and Consultant, J. & W. Seligman & Co.
Incorporated, investment managers and advisors;
Director or Trustee, Tri-Continental Corporation,
closed-end investment company; and the open-end
investment companies in the Seligman Group of
Investment Companies; Director, Seligman Financial
Services, Inc., distributor; Seligman Quality Municipal
Fund, Inc. and Seligman Select Municipal Fund, Inc.,
closed-end investment companies; Seligman Services
Inc., broker/dealer; Trustee, Trudeau Institute,
nonprofit bio-medical research organization; Lake
Placid Center for the Arts, cultural organization; Lake
Placid Education Foundation, education foundation;
formerly, Director, J. & W. Seligman Trust Company,
trust company; and Seligman Securities, Inc.,
broker/dealer.
ALICE S. ILCHMAN
(59)
Director
President, Sarah Lawrence College; Director or Trustee,
the Seligman Group of Investment Companies; NYNEX
(formerly, New York Telephone Company), telephone
company; The Rockefeller Foundation, charitable
foundation; and The Committee for Economic Development;
formerly, Trustee, The Markle Foundation, philanthropic
organization; and Director, International Research and
Exchange Board, intellectual exchanges. Sarah Lawrence
College, Bronxville, NY 10708
-4-
<PAGE>
JOHN E. MEROW*
(65)
Director
Partner, Sullivan & Cromwell, law firm; Director or
Trustee, the Commonwealth Aluminum Corporation; the
Seligman Group of Investment Companies; the Municipal
Art Society of New York; the U. S. Council for
International Business and the U. S.-New Zealand
Council; Chairman, American Australian Association; the
Municipal Art Society of New York; Member of the
American Law Institute and Council on Foreign
Relations; and Member of the Board of Governors of the
Foreign Policy Association and New York Hospital. 125
Broad Street, New York, NY 10004
BETSY S. MICHEL
(52)
Director
Attorney; Director or Trustee, the Seligman Group of
Investment Companies; National Association of
Independent Schools (Washington, D.C.), education;
Chairman of the Board of Trustees of St. George's
School (Newport, RI). St. Bernard's Road, P.O. Box 449,
Gladstone, NJ 07934
DOUGLAS R. NICHOLS, JR.
(75)
Director
Management Consultant; Director or Trustee, the
Seligman Group of Investment Companies; formerly,
Trustee, Drew University. 790 Andrews Avenue, Delray
Beach, FL 33483
JAMES C. PITNEY
(68)
Director
Partner, Pitney, Hardin, Kipp & Szuch, law firm;
Director or Trustee, the Seligman Group of Investment
Companies; Public Service Enterprise Group, public
utility. Park Avenue at Morris County, P.O. Box 1945,
Morristown, NJ 07962-1945
JAMES Q. RIORDAN
(67)
Director
Director, Various Corporations; Director or Trustee,
the Seligman Group of Investment Companies; The
Brooklyn Museum; The Brooklyn Union Gas Company; The
Committee for Economic Development; Dow Jones & Co.,
Inc.; Public Broadcasting Service; formerly, Co-
Chairman of the Policy Council of the Tax Foundation;
Director and Vice Chairman, Mobil Corporation;
Director, Tesoro Petroleum Companies, Inc.; and
Director and President, Bekaert Corporation.
675 Third Avenue, Suite 3004, New York, NY 10017
HERMAN J. SCHMIDT
(78)
Director
Director, Various Corporations; Director or Trustee,
the Seligman Group of Investment Companies; H. J. Heinz
Company; HON Industries, Inc.; and MAPCO, Inc;
formerly, Director, MetLife Series Fund, Inc. and
MetLife Portfolios, Inc.; and Ryder System, Inc.
15 Oakley Lane, Greenwich, CT 06830
ROBERT L. SHAFER
(62)
Director
Vice President, Pfizer Inc., pharmaceuticals; Director
or Trustee, the Seligman Group of Investment Companies;
and USLIFE Corporation, life insurance. 235 East 42nd
Street, New York, NY 10017
-5-
<PAGE>
JAMES N. WHITSON
(60)
Director
Executive Vice President, Chief Operating Officer and
Director, Sammons Enterprises, Inc.; Director or
Trustee, Red Man Pipe and Supply Company, piping and
other materials; the Seligman Group of Investment
Companies; Director, C-SPAN.
300 Crescent Court, Suite 700, Dallas, TX 75201
BRIAN T. ZINO*
(42)
Director and Member of the Executive Committee
Managing Director (formerly, Chief Administrative and
Financial Officer), J. & W. Seligman & Co.
Incorporated, investment managers and advisors;
Director or Trustee, the Seligman Group of Investment
Companies; Chairman, Seligman Data Corp., shareholder
service agent; Director, Seligman Financial Services,
Inc., distributor; Seligman Services, Inc.,
broker/dealer; Senior Vice President, Seligman
Henderson Co., advisors; formerly, Director and
Secretary, Chuo Trust - JWS Advisors, Inc., advisors;
and Director, Seligman Securities, Inc., broker/dealer;
and J. & W. Seligman Trust Company, trust company.
PAUL H. WICK
(33)
Vice President and Portfolio Manager
Managing Director (formerly, Vice President, Investment
Officer), J. & W. Seligman & Co. Incorporated,
investment managers and advisors; Vice President and
Portfolio Manager, three other open-end investment
companies in the Seligman Group of Investment
Companies; Portfolio Manager, Seligman Henderson Co.,
advisor; formerly, Senior Vice President, Portfolio
Management, Chuo Trust-JWS Advisors, Inc.,
advisor.
LAWRENCE P. VOGEL
(38)
Vice President
Senior Vice President, Finance, J. & W. Seligman & Co.
Incorporated, investment managers and advisors;
Seligman Financial Services, Inc., distributor; and
Seligman Advisors, Inc., advisors; Vice President, the
Seligman Group of Investment Companies; Senior Vice
President, Finance (formerly, Treasurer), Seligman Data
Corp., shareholder service agent; Treasurer, Seligman
Holdings, Inc., holding company; and Seligman Henderson
Co., advisors; formerly, Senior Audit Manager at Price
Waterhouse, independent accountants.
FRANK J. NASTA
(30)
Secretary
Secretary, the Seligman Group of Investment Companies;
J. & W. Seligman & Co., Incorporated, investment
managers and advisers; Seligman Financial Services,
Inc., distributor; Seligman Henderson Co., advisers;
Seligman Services, Inc., broker/dealers; Seligman Data
Corp.; Vice President, Law and Regulation, J. & W.
Seligman & Co. Incorporated, investment managers and
advisers; formerly, attorney, Seward & Kissel.
THOMAS G. ROSE
(37)
Treasurer
Treasurer, the Seligman Group of Investment Companies;
and Seligman Data Corp., shareholder service agent;
formerly, Treasurer, American Investors Advisors,
Inc.
The Executive Committee of the Board acts on behalf of the Board between
meetings to determine the value of securities and assets owned by the Fund for
which no market valuation is available and to elect or appoint officers of the
Fund to serve until the next meeting of the Board.
-6-
<PAGE>
Compensation Table
<TABLE>
<CAPTION>
Pension or
Aggregate Retirement Benefits Total Compensation
Compensation Accrued as part of from Fund and
Position With Registrant from Fund (1) Fund Expenses Fund Complex (2)
- ------------------------ ------------- ------------- ----------------
<S> <C> <C> <C>
William C. Morris, Director N/A N/A N/A
Ronald T. Schroeder, Director N/A N/A N/A
Fred E. Brown, Director N/A N/A N/A
Alice S. Ilchman, Director $2,519.97 N/A $67,000.00
John E. Merow, Director 2,484.26(d) N/A 66,000.00(d)
Betsy S. Michel, Director 2,484.26 N/A 66,000.00
Douglas R. Nichols, Jr., Director 2,484.26 N/A 66,000.00
James C. Pitney, Director 2,519.97 N/A 67,000.00
James Q. Riordan, Director 2,484.26 N/A 66,000.00
Herman J. Schmidt, Director 2,484.26 N/A 66,000.00
Robert L. Shafer, Director 2,484.26 N/A 66,000.00
James N. Whitson, Director 2,484.26(d) N/A 66,000.00(d)
Brian T. Zino, Director N/A N/A N/A
- ----------------------
</TABLE>
(1) Based on remuneration received by the Directors of the Fund for the year
ended December 31, 1994.
(2) As defined in the Fund's Prospectus, the Seligman Group of Investment
Companies consists of seventeen investment companies.
(d) Deferred. The total amounts of deferred compensation (including interest)
payable to Messrs. Merow, Pitney and Whitson as of December 31, 1994 were
$35,953, $34,077 and $3,998, respectively. Mr. Pitney no longer defers current
compensation.
The Fund has a compensation arrangement under which outside directors may
elect to defer receiving their fees. Under this arrangement, interest is accrued
on the deferred balances. The annual cost of such interest is included in the
directors' fees and expenses, and the accumulated balance thereof is included in
"Liabilities" in the Fund's financial statements.
Directors and officers of the Fund are also directors or trustees and
officers of some or all of the other investment companies in the Seligman Group.
Directors and officers of the Fund as a group owned directly or indirectly
80,496 shares or less than 1% of the Fund's Class A Capital Stock at March 31,
1995. As of that date, no Directors or officers owned shares of the Fund's Class
D Capital Stock.
MANAGEMENT AND EXPENSES
As indicated in the Prospectus, under the Management Agreement, dated
December 29, 1988, subject to the control of the Board of Directors, the Manager
manages the investment of the assets of the Fund, including making purchases and
sales of portfolio securities consistent with the Fund's investment objectives
and policies, and administers its business and other affairs. The Manager
provides the Fund with such office space, administrative and other services and
executive and other personnel as are necessary for Fund operations. The Manager
pays all of the compensation of directors of the Fund who are employees or
consultants of the Manager and of the officers and employees of the Fund. The
Manager also provides senior management for Seligman Data Corp., the Fund's
shareholder service agent.
The Fund pays the Manager a management fee for its services, calculated daily
and payable monthly, equal to 0.75% of the daily net assets of the Fund. The
management fees paid for 1994, 1993 and 1992 were $1,547,256, $529,841 and
$378,816 respectively, or .75%, .75% and .75%, respectively, of the Fund's
average net assets.
The Fund pays all its expenses other than those assumed by the Manager,
including brokerage commissions, administration, shareholder services and
distribution fees, fees and expenses of independent attorneys and auditors,
taxes and governmental fees, cost of stock certificates and expenses of
repurchase or redemption of shares, expenses of printing and distributing
reports, notices and proxy materials to shareholders, expenses of printing and
filing reports and other documents with governmental agencies including fees and
expenses for qualifying the Fund and its shares under Federal and state
-7-
<PAGE>
securities laws, expenses of shareholders' meetings, expenses of corporate data
processing and related services, shareholder record keeping and shareholder
account services, fees and disbursements of transfer agents and custodians,
expenses of disbursing dividends and distributions, fees and expenses of
directors of the Fund not employed by (or serve as a Director of) the Manager or
its affiliates, insurance premiums and extraordinary expenses such as litigation
expenses. The Manager has undertaken to one state securities administrator, so
long as required, to reimburse the Fund for each year in the amount by which
total expenses, including the management fee, but excluding interest, taxes,
brokerage commissions, distribution fees, extraordinary expenses and a portion
of expenses related to shareholder account and transfer services, exceed 2 1/2%
of the first $30,000,000 of average net assets, 2% of the next $70,000,000 and 1
1/2% thereafter. Such reimbursement, if any, will be made monthly.
On December 29, 1988, a majority of the outstanding voting securities of the
Manager was purchased by Mr. William C. Morris and a simultaneous
recapitalization of the Manager occurred.
The Management Agreement was approved by the Board of Directors on September
30, 1988 and by the shareholders at a Special Meeting held on December 16, 1988.
The Management Agreement will continue in effect until December 31 of each year
if (1) such continuance is approved in the manner required by 1940 Act (by a
vote of a majority of the Board of Directors or of the outstanding voting
securities of the Fund and by a vote of a majority of the Directors who are not
parties to the Management Agreement or interested persons of any such party) and
(2) if the Manager shall not have notified the Fund at least 60 days prior to
December 31 of any year that it does not desire such continuance. The
Management Agreement may be terminated by the Fund, without penalty, on 60 days'
written notice to the Manager and will terminate automatically in the event of
its assignment. The Fund has agreed to change its name upon termination of the
Management Agreement if continued use of the name would cause confusion in the
context of the Manager's business.
The Manager is a successor firm to an investment banking business founded in
1864 which has thereafter provided investment services to individuals, families,
institutions and corporations. See the Appendix for further history of the
Manager.
Under the Subadvisory Agreement, dated June 1, 1994, the Subadviser
supervises and directs a portion of the Fund's investment in foreign securities
and Depository Receipts consistent with the Fund's investment objectives,
policies and principles. For these services, the Subadviser is paid a fee as
described in the Fund's Prospectus. The Subadvisory Agreement was approved by
the Board of Directors at a meeting held on January 20, 1994 and by the
shareholders of the Fund on May 19, 1994. The Subadvisory Agreement will
continue in effect until December 31, 1995, and from year to year thereafter if
such continuance is approved in the manner required by the 1940 Act (by a vote
of a majority of the Board of Directors or of the outstanding voting securities
of the Fund and by a vote of a majority of the Directors who are not parties to
the Subadvisory Agreement or interested persons of any such party) and (2) if
the Subadviser shall not have notified the Manager in writing at least 60 days
prior to December 31 of any year that it does not desire such continuance. The
Subadvisory Agreement may be terminated at any time by the Fund, on 60 days
written notice to the Subadviser. The Subadvisory Agreement will terminate
automatically in the event of its assignment or upon the termination of the
Management Agreement.
For the period June 1, 1994 through December 31, 1994, the Fund did not
require the services of the Subadviser.
The Subadviser is a New York general partnership formed by the Manager and
Henderson International, Inc., a controlled affiliate of Henderson
Administration Group plc. Henderson Administration Group plc, headquartered in
London, is one of the largest independent money managers in Europe. The Firm
currently manages approximately $18.5 billion in assets and is recognized as a
specialist in global equity investing.
Officers, directors and employees of the Manager are permitted to engage in
personal securities transactions, subject to the Manager's Code of Ethics (the
"Code"). The Code proscribes certain practices with regard to personal
securities transactions and personal dealings, provides a framework for the
reporting and monitoring of personal securities transactions by the Manager's
Director of Compliance, and sets forth a procedure of identifying, for
disciplinary action, those individuals who violate the Code. The Code prohibits
each of the officers, directors and employees (including all portfolio managers)
of the Manager from purchasing or selling any security that the officer,
director or employee knows or believes (i) was recommended by the Manager for
purchase or sale by any client, including the Fund, within the preceding two
weeks, (ii) has been reviewed by the Manager for possible purchase or sale
within the preceding two weeks, (iii) is being purchased or sold by any client,
(iv) is being considered by a research analyst, (v) is being acquired in a
private placement, unless prior approval has been obtained from the Manager's
Director of Compliance, or (vi) is being acquired during an initial or
-8-
<PAGE>
secondary public offering. The Code also imposes a strict standard of
confidentiality and requires portfolio managers to disclose any interest they
may have in the securities or issuers that they recommend for purchase by any
client.
The Code also prohibits (i) each portfolio manager or member of an investment
team from purchasing or selling any security within seven calendar days of the
purchase or sale of the security by a client's account (including investment
company accounts) for which the portfolio manager or investment team manages and
(ii) each employee from engaging in short-term trading (a purchase and sale or
vice-versa within 60 days). Any profit realized pursuant to either of these
prohibitions must be disgorged.
Officers, directors and employees are required, except under very limited
circumstances, to engage in personal securities transactions through the
Manager's order desk. The order desk maintains a list of securities that may
not be purchased due to a possible conflict with clients. All officers,
directors and employees are also required to disclose all securities
beneficially owned by them on December 31 of each year.
ADMINISTRATION, SHAREHOLDER SERVICES AND DISTRIBUTION PLAN
As indicated in the Prospectus, the Fund has adopted an Administration,
Shareholder Services and Distribution Plan for each Class (the "Plan") in
accordance with Section 12(b) of the Act and Rule 12b-1 thereunder.
The Plan was approved on July 16, 1992 by the Board of Directors of the Fund,
including a majority of the Directors who are not "interested persons" (as
defined in the Act) and who have no direct or indirect financial interest in the
operation of the Plan or in any agreement related to the Plan (the "Qualified
Directors") and was approved by shareholders of the Fund at a Special Meeting of
Shareholders held on November 23, 1992. The Plan became effective in respect of
the Class A shares on January 1, 1993. The Plan was approved in respect of the
Class D shares on March 18, 1993 by the Board of Directors of the Fund,
including a majority of the Qualified Directors, and became effective with
respect to the Class D shares on May 1, 1993. The Plan will continue in effect
through December 31 of each year so long as such continuance is approved by a
majority vote of both the Directors and the Qualified Directors of the Fund,
cast in person at a meeting called for the purpose of voting on such approval.
The Plan may not be amended to increase materially the amounts payable to
Service Organizations with respect to a Class without the approval of a majority
of the outstanding voting securities of the Class and no material amendment to
the Plan may be made except by a majority of both the Directors and Qualified
Directors.
The Plan requires that the Treasurer of the Fund shall provide to the
Directors, and the Directors shall review, at least quarterly, a written report
of the amounts expended (and purposes therefor) under the Plan. Rule 12b-1 also
requires that the selection and nomination of Directors who are not "interested
persons" of the Fund be made by such disinterested Directors.
PORTFOLIO TRANSACTIONS
The Management and Subadvisory Agreements recognize that in the purchase and
sale of portfolio securities the Manager and Subadviser will seek the most
favorable price and execution, and, consistent with that policy, may give
consideration to the research, statistical and other services furnished by
brokers or dealers to the Manager and Subadviser for their use, as well as to
the general attitude toward and support of investment companies demonstrated by
such brokers or dealers. Such services include supplemental investment
research, analysis and reports concerning issuers, industries and securities
deemed by the Manager and Subadviser to be beneficial to the Fund. In addition,
the Manager and Subadviser are authorized to place orders with brokers who
provide supplemental investment and market research and statistical and economic
analysis although the use of such brokers may result in a higher brokerage
charge to the Fund than the use of brokers selected solely on the basis of
seeking the most favorable price and execution and although such research and
analysis may be useful to the Manager and Subadviser in connection with its
services to clients other than the Fund.
In over-the-counter markets, the Fund deals with primary market makers unless
a more favorable execution or price is believed to be obtainable. The Fund may
buy securities from or sell securities to dealers acting as principal, except
dealers with which its directors and/or officers are affiliated.
When two or more of the investment companies in the Seligman Group or other
investment advisory clients of the Manager and Subadviser desire to buy or sell
the same security at the same time the securities purchased or sold are
allocated by the Manager and Subadviser in a manner believed to be equitable to
each. There may be possible advantages or disadvantages of such transactions
with respect to price or the size of positions readily obtainable or
saleable.
-9-
<PAGE>
Brokerage commissions for the last three years are set forth in the following
table:
<TABLE>
<CAPTION>
Year Ended December 31
----------------------
1994 1993 1992
---- ---- ----
<S> <C> <C> <C>
Total Brokerage Commissions Paid (1) $266,940 $77,850 $50,944
Brokerage Commissions Paid
to Seligman Securities, Inc. (2) --- 3,175 25,859
Brokerage Commissions Paid to Others for Execution
and Research and Statistical Services 266,940 74,675 25,085
</TABLE>
Notes:
(1) Not including any spreads on principal transactions on a net basis.
(2) Brokerage commissions paid to Seligman Securities, Inc. were 4.1% and 50.8%
of total brokerage commissions paid for 1993 and 1992 respectively. The
aggregate dollar amount of the Fund's transactions for which Seligman
Securities, Inc. acted as broker was 5.4% of the total dollar amount of all
commission transactions in 1993 and 51.1% in 1992. The Board of Directors
adopted procedures effective January 1, 1984, pursuant to which Seligman
Securities, Inc. was available to the Fund as broker for approximately one-
half of agency transactions in listed securities at commission rates
believed in accordance with applicable regulations to be fair and
reasonable. As of March 31, 1993, Seligman Securities, Inc. ceased
functioning as a broker for the Fund and its other clients.
PURCHASE AND REDEMPTION OF FUND SHARES
The Fund issues two classes of shares: Class A shares may be purchased at a
price equal to the next determined net asset value per share, plus a sales load.
Class D shares may be purchased at a price equal to the next determined net
asset value without an initial sales load, but a CDSL may be charged on
redemptions within one year of purchase. See "Alternative Distribution System,"
"Purchase Of Shares," and "Redemption Of Shares" in the Prospectus.
SPECIMEN PRICE MAKE-UP
Under the current distribution arrangements between the Fund and the
Distributor, Class A shares are sold at a maximum sales charge of 4.75% and
Class D shares are sold at net asset value/*/. Using the Fund's net asset value
at December 31, 1994, the maximum offering price of the Fund's shares is as
follows:
<TABLE>
<CAPTION>
CLASS A
<S> <C>
Net asset value per Class A share.................................. $16.64
Maximum sales load (4.75% of offering price)....................... .83
------
Offering price to public........................................... $17.47
======
CLASS D
Net asset value and offering price to public per Class D share/*/.. $16.31
======
</TABLE>
____________
/*/ Class D shares are subject to a CDSL of 1% on redemptions within one year
of purchase. See "Redemption Of Shares" in the Prospectus.
CLASS A SHARES - REDUCED SALES LOADS
Reductions Available. Shares of any future Seligman Funds sold with a sales
- --------------------
load in a continuous offering will be eligible for the foregoing reductions.
-10-
<PAGE>
VOLUME DISCOUNTS are provided if the total amount being invested in Class A
shares of the Fund alone, or in any combination of shares of the other Funds in
the Seligman Group which are sold with a sales load, reaches levels indicated in
the sales load schedule set forth in the Prospectus.
THE RIGHT OF ACCUMULATION allows an investor to combine the amount being
invested Class A in shares of the Fund and shares of Seligman Capital Fund,
Seligman Common Stock Fund, Seligman Frontier Fund, Seligman Growth Fund,
Seligman Henderson Global Fund Series, Seligman High Income Fund Series,
Seligman Income Fund, Seligman New Jersey Tax-Exempt Fund, Seligman Pennsylvania
Tax-Exempt Fund Series, Seligman Tax-Exempt Fund Series, or Seligman Tax-Exempt
Series Trust sold with a sales load with the total net asset value of shares of
those Mutual Funds already owned that were sold with a sales load and the total
net asset value of shares of Seligman Cash Management Fund which were acquired
through an exchange of shares of another Mutual Fund in the Seligman Group on
which there was a sales load at the time of purchase to determine reduced sales
loads in accordance with the schedule in the Prospectus. The value of the shares
owned, including the value of shares of Seligman Cash Management Fund acquired
in an exchange of shares of another Mutual Fund in the Seligman Group on which
there was a sales load at the time of purchase, will be taken into account in
orders placed through a dealer, however, only if Seligman Financial Services,
Inc. is notified by an investor or a dealer of the amount owned at the time the
purchase is made and is furnished sufficient information to permit
confirmation.
A LETTER OF INTENT allows an investor to purchase Class A shares over a 13-
month period at reduced sales loads in accordance with the schedule in the
Prospectus, based on the total amount of Class A shares of the Fund that the
letter states the investor intends to purchase plus the total net asset value of
shares sold with a sales load of Seligman Capital Fund, Seligman Common Stock
Fund, Seligman Frontier Fund, Seligman Growth Fund, Seligman Henderson Global
Fund Series, Seligman High Income Fund Series, Seligman Income Fund, Seligman
New Jersey Tax-Exempt Fund, Seligman Pennsylvania Tax-Exempt Fund Series,
Seligman Tax-Exempt Fund Series, or Seligman Tax-Exempt Series Trust already
owned and the total net asset value of shares of Seligman Cash Management Fund
which were acquired through an exchange of shares of another Mutual Fund in the
Seligman Group on which there was a sales load at the time of purchase. Reduced
sales loads also may apply to purchases made within a 13-month period starting
up to 90 days before the date of execution of a letter of intent. For more
information concerning the terms of the letter of intent see "Terms and
Conditions-Letter of Intent-Class A Shares Only" accompanying the Account
Application in the Prospectus.
Persons Entitled To Reductions. Reductions in sales loads apply to purchases of
- ------------------------------
Class A shares by a "single person," including an individual; members of a
family unit comprising husband, wife and minor children; or a trustee or other
fiduciary purchasing for a single fiduciary account. Employee benefit plans
qualified under Section 401 of the Internal Revenue Code, tax-exempt
organizations under Section 501 (c)(3) or (13), and non-qualified employee
benefit plans that satisfy uniform criteria are considered "single persons" for
this purpose. The uniform criteria are as follows:
1. Employees must authorize the employer, if requested by the Fund, to
receive in bulk and to distribute to each participant on a timely basis the Fund
prospectus, reports and other shareholder communications.
2. Employees participating in a plan will be expected to make regular
periodic investments (at least annually). A participant who fails to make such
investments may be dropped from the plan by the employer or the Fund 12 months
and 30 days after the last regular investment in his account. In such event, the
dropped participant would lose the discount on share purchases to which the plan
might then be entitled.
3. The employer must solicit its employees for participation in such an
employee benefit plan or authorize and assist an investment dealer in making
enrollment solicitations.
Eligible Employee Benefit Plans. The term "eligible employee benefit plan"
- -------------------------------
means any plan or arrangement, whether or not tax qualified, which provides for
the purchase of Fund shares. The term "participant account plan" means any
"eligible employee benefit plan" where (i) the Fund shares are purchased through
payroll deductions or otherwise by a fiduciary or other person for the account
of participants who are employees (or their spouses) of an employer and (ii) a
separate Open Account is maintained in the name of such fiduciary or other
person for the account of each participant in the plan (such as a payroll
deduction IRA program).
The table of sales loads in the Prospectus applies to sales to "eligible
employee benefit plans," except that the Fund may sell shares at net asset
value to "eligible employee benefit plans," of employers who have at least 2,000
U.S. employees to whom such plan is made available or, regardless of the number
of employees, if such plan is established or maintained by any dealer which has
a sales agreement with Seligman Financial Services, Inc. Such sales must be
made in connection with a payroll deduction system of plan funding or other
systems acceptable to Seligman Data Corp., the Fund's shareholder ser-
-11-
<PAGE>
vice agent. Such sales are believed to require limited sales effort and sales-
related expenses and therefore are made at net asset value. Contributions or
account information for plan participation also should be transmitted to
Seligman Data Corp.by methods which it accepts. Additional information about
"eligible employee benefit plans" is available from investment dealers or
Seligman Financial Services, Inc.
Payment in Securities. In addition to cash, the Fund may accept securities in
- ---------------------
payment for Fund shares sold at the applicable public offering price (net asset
value plus any applicable sales load) although the Fund does not presently
intend to accept securities in payment for Fund shares. Generally, the Fund
will only consider accepting securities (l) to increase its holdings in a
portfolio security, or (2) if the Manager determines that the offered securities
are a suitable investment for the Fund and in a sufficient amount for efficient
management. Although no minimum has been established, it is expected that the
Fund would not accept securities with a value of less than $100,000 per issue in
payment for shares. The Fund may reject in whole or in part offers to pay for
Fund shares with securities, may require partial payment in cash for applicable
sales loads, and may discontinue accepting securities as payment for Fund shares
at any time without notice. The Fund will not accept restricted securities in
payment for shares. The Fund will value accepted securities in the manner
provided for valuing portfolio securities of the Fund. Any securities in the
manner provided for valuing portfolio securities of the Fund. Any securities
accepted by the Fund in payment for Fund shares will have an active and
substantial market and have a value which is readily ascertainable (See
"Valuation"). In accordance with Texas securities regulations, should the Fund
accept securities in payment for shares, such transactions would be limited to a
bona fide reorganization, statutory merger, or to other acquisitions of
portfolio securities (except for municipal debt securities issued by state
political subdivisions or their agencies or instrumentalities) which meet the
investment objectives and policies of the investment company; are acquired for
investment and not for resale; are liquid securities which are not restricted as
to transfer either by law or liquidity of market; and have a value which is
readily ascertainable (and not established only by evaluation procedures) as
evidenced by a listing on the American Stock Exchange, the New York Stock
Exchange or NASDAQ.
Further Types of Reductions. Class A shares may be issued without a sales load
- ---------------------------
in connection with the acquisition of cash and securities owned by other
investment companies and personal holding companies, to financial institution
trust departments, to registered investment advisers exercising discretionary
investment authority with respect to the purchase of Fund shares, or pursuant to
sponsored arrangements with organizations which make recommendations to, or
permit group solicitation of, its employees, members or participants in
connection with the purchase of shares of the Fund, and to separate accounts
established and maintained by an insurance company which are exempt from
registration under Section 3(c)(11) of the Investment Company Act of 1940, to
registered representatives (and their spouses and minor children) and employees
of any dealer that has a sales agreement with SFSI, to shareholders of mutual
funds with investment objectives and policies similar to the Fund's who purchase
shares with redemption proceeds of such funds and to certain unit investment
trusts as described in the Prospectus.
Class A shares may be sold at net asset value to these persons since such
sales require less sales effort and lower sales related expenses as compared
with sales to the general public.
More About Redemptions. The procedures for redemption of Fund shares under
- ----------------------
ordinary circumstances are set forth in the Prospectus. In unusual
circumstances payment may be postponed, if the orderly liquidation of portfolio
securities is prevented by the closing of, or restricted trading on the New York
Stock Exchange during periods of emergency, or such other periods as ordered by
the Securities and Exchange Commission. Payment may be made in securities,
subject to the review of some state securities commissions. If payment is made
in securities, a shareholder may incur brokerage expenses in converting these
securities into cash.
DISTRIBUTION SERVICES
The Fund and Seligman Financial Services, Inc. ("SFSI") are parties to a
Distributing Agreement, dated January 1, 1993. SFSI, an affiliate of the
Manager, acts as general distributor of the shares of the Fund and of the other
mutual funds in the Seligman Group. As general distributor of the Fund's
Capital Stock, SFSI allows concessions to all dealers, as indicated in the
Prospectus. Pursuant to agreements with the Fund, certain dealers may also
provide sub-accounting and other services for a fee. SFSI receives the balance
of sales loads and any CDSLs paid by investors. The balance of sales loads paid
by investors and received by SFSI in respect of Class A shares amounted to
$693,835 in 1994, after allowance of $5,926,699 as concessions to dealers;
$48,139 in 1993, after allowance of $773,862 as concessions to dealers; and
$8,320 in 1992, after allowance of $70,934 as concessions to dealers. For the
year ended December 31, 1994, SFSI retained CDSL charges from Class D shares
amounting to $34,431; and $1,420 for the period May 3, 1993 to December 31,
1993.
-12-
<PAGE>
Class A shares may be sold at net asset value to present and retired
directors, trustees, officers, employees (and their spouses and minor children)
of the Fund, the other investment companies in the Seligman Group, the Manager
and other companies affiliated with the Manager. Such sales also may be made to
employee benefit and thrift plans for such persons and to any investment
advisory, custodial, trust or other fiduciary account managed or advised by the
Manager or any affiliate. These sales may be made for investment purposes only,
and shares may be resold only to the Fund.
VALUATION
Net asset value per Fund share is determined as of the close of trading on
the New York Stock Exchange, (usually 4:00 p.m. Eastern time), each day that the
New York Stock Exchange is open. The New York Stock Exchange is currently closed
on New Year's Day, Presidents' Day, Good Friday, Memorial Day, Independence Day,
Labor Day, Thanksgiving Day and Christmas Day. The fair value of any restricted
securities held by the Fund will be determined by the Manager in accordance with
procedures approved by the Directors. This value generally will be determined as
the amount which the Fund could reasonably expect to receive from an orderly
disposition of these securities over a reasonable period of time. The net asset
value of Class D shares will generally be lower than the net asset value of
Class A shares as a result of the larger distribution fee with respect to Class
D shares.
The net asset value per share is determined separately for each class of
shares. Portfolio securities, including open short positions and options
written, are valued at the last sale price on the securities exchange or
securities market on which such securities primarily are traded. Securities
traded on a foreign exchange or over-the-counter market are valued at the last
sales price on the primary exchange or market on which they are traded. United
Kingdom securities for which there are not recent sales transactions are valued
based on quotations provided by primary market makers in such securities. Any
securities for which recent market quotations are not readily available,
including restricted securities, are valued at fair value as determined in
accordance with procedures approved by the Board of Directors. Short-term
obligations with less than sixty days remaining to maturity are generally valued
at amortized cost. Short-term obligations with more than sixty days remaining
to maturity will be valued at current market value until the sixtieth day prior
to maturity, and will then be valued on an amortized cost basis based on the
value on such date unless the Board determines that this amortized cost value
does not represent fair market value. Expenses and fees, including the
investment management fee, are accrued daily and taken into account for the
purpose of determining the net asset value of Fund shares.
Generally, trading in foreign securities, as well as US Government
securities, money market instruments and repurchase agreements, is substantially
completed each day at various times prior to the close of the NYSE. The values
of such securities used in computing the net asset value of the shares of the
Fund are determined as of such times. Foreign currency exchange rates are also
generally determined prior to the close of the NYSE. Occasionally, events
affecting the value of such securities and such exchange rates may occur between
the times at which they are determined and the close of the NYSE, which will not
be reflected in the computation of net asset value. If during such periods
events occur which materially affect the value of such securities, the
securities will be valued at their fair market value as determined in accordance
with procedures approved by the Board of Directors.
For purposes of determining the net asset value per share of the Fund, all
assets and liabilities initially expressed in foreign currencies will be
converted into US dollars at the mean between the bid and offer prices of such
currencies against US dollars quoted by a major bank that is a regular
participant in the foreign exchange market or on the basis of a pricing service
that takes into account the quotes provided by a number of such major banks.
PERFORMANCE
The Fund's average annual total returns of Class A shares for the one-year,
five-year and ten-year periods ended December 31, 1994 were 28.87%, 23.00% and
21.61% respectively. These amounts were computed by assuming a hypothetical
initial payment of $1,000, subtracting the maximum sales load of $47.50 (4.75%
of public offering price) and assuming that all of the dividends and
distributions by the Fund over the relevant time period were reinvested. It was
then assumed that at the end of these periods the entire amount was redeemed.
The average annual total returns were then calculated by calculating the annual
rate required for the initial payment to grow to the amount which would have
been received upon redemption (i.e., the average annual compound rate of
return). The average annual total returns for Class D shares of the Fund for
the one-year period ended December 31, 1994 and since inception through December
31, 1994 were 32.94% and 42.72%, respectively. This amount was computed
assuming a hypothetical initial payment of $1,000 and that all of the dividends
and distributions paid by the Fund's Class D shares, if any, were reinvested
over the relevant time period. For the one-year period ended December 31, 1994,
it was then assumed that at the end of the period, the entire amount was
redeemed, subtracting the applicable 1% CDSL.
-13-
<PAGE>
Table A below illustrates the total return (income and capital) on Class A
shares of the Fund with dividends invested and gain distributions, if any, taken
in shares. It shows that a $1,000 investment in Class A shares, assuming
payment of the 4.75% sales load, made on January 1, 1985 had a value of $7,073
on December 31, 1994, resulting in an aggregate total return of 607.31%. Table
B illustrates the total return (income and capital) on Class D shares of the
Fund with dividends invested and gain distributions, if any, taken in shares.
It shows that a $1,000 investment in Class D shares made on May 3, 1993
(commencement of offering of Class D shares) had a value of $1,807 on December
31, 1994 resulting in an aggregate total return of 80.67%. The results shown
should not be considered a representation of the dividend income or gain or
loss in capital value which may be realized from an investment made in a class
of shares of the Fund today.
TABLE A - CLASS A SHARES
<TABLE>
<CAPTION>
Value of
Year Value of Initial Value of Gain Dividend Total
Ended (1) Investment (2) Distribution Invested Total Value(2) Return (3)
- --------- -------------- ------------ -------- -------------- ----------
<S> <C> <C> <C> <C> <C>
1985 $ 1,265 $ 0 $ 13 $ 1,278
1986 1,433 43 14 1,490
1987 1,282 420 12 1,714
1988 1,267 561 12 1,840
1989 1,272 1,109 13 2,394
1990 1,116 1,002 11 2,129
1991 1,456 1,828 14 3,298
1992 1,547 2,307 15 3,869
1993 1,689 3,522 17 5,228
1994 2,093 4,960 20 7,073 607.31%
</TABLE>
TABLE B - CLASS D SHARES
<TABLE>
<CAPTION>
Value of
Year Value of Initial Value of Gain Dividend Total
Ended (1) Investment (2) Distribution Invested Total Value(2) Return (3)
- --------- -------------- ------------ -------- -------------- ----------
<S> <C> <C> <C> <C> <C>
1993 $ 1,088 $ 261 $ -- $ 1,349
1994 1,333 474 -- 1,807 80.67%
</TABLE>
(1) For the ten years ended December 31, 1994; and from commencement of
offering of Class D shares on May 3, 1993.
(2) The "Value of Initial Investment" as of the date indicated reflects the
effect of the maximum sales load, assumes that all dividends and capital
gains distributions were taken in cash and reflect changes in the net asset
value of the shares purchased with they hypothetical initial investment.
"Total Value" reflects the effect of the CDSL, if applicable, assumes
investment of all dividends and capital gain distributions and reflects
changes in the net asset value.
(3) "Total Return" for each class of shares of the Fund is calculated by
assuming a hypothetical initial investment of $1,000 at the beginning of
the period specified, subtracting the maximum sales load for Class A
shares; determining total value of all dividends and distributions that
would have been paid during the period on such shares assuming that each
dividend or distribution was invested in additional shares at net asset
value; calculating the total value of the investment at the end of the
period, subtracting the CDSL on Class D shares, if applicable; and finally,
by dividing the difference between the amount of the hypothetical initial
investment at the beginning of the period and its total value at the end of
the period by the amount of the hypothetical initial investment.
No adjustments have been made for any income taxes payable by investors on
dividends invested or gain distributions taken in shares.
The total return and average annual total return of the Class A shares
quoted from time to time through December 31, 1992 does not reflect the
deduction of the administration, shareholder services and distribution fee,
effective January 1, 1993, which fee is reflected would reduce the performance
quoted.
The Fund may also include its aggregate total return over a specified period
in advertisements or in information furnished to present or prospective
shareholders.
-14-
<PAGE>
GENERAL INFORMATION
Capital Stock. The Board of Directors is authorized to classify or reclassify
- --------------
and issue any unissued Capital Stock of the Fund into any number of other
classes without further action by shareholders. The Investment Company Act of
1940 requires that where more than one class exists, each class must be
preferred over all other classes in respect of assets specifically allocated to
such class.
Custodian. Investors Fiduciary Trust Company, 127 West 10th Street, Kansas
- ----------
City, Missouri 64105 serves as custodian of the Fund. It also maintains, under
the general supervision of the Manager, the accounting records and determines
the net asset value for the Fund.
Auditors. Deloitte & Touche LLP, independent auditors, have been selected as
- ---------
auditors of the Fund. Their address is Two World Financial Center, New York,
New York 10281.
FINANCIAL STATEMENTS
The Annual Report to Shareholders for the year ended December 31, 1994 is
incorporated by reference into this Statement of Additional Information. The
Annual Report contains a schedule of the investments as of December 31, 1994, as
well as certain other financial information as of that date. The Annual Report
will be furnished, without charge, to investors who request copies of the Fund's
Statement of Additional Information.
-15-
<PAGE>
APPENDIX
HISTORY OF J. & W. SELIGMAN & CO. INCORPORATED
Seligman's beginnings date back to 1837, when Joseph Seligman, the oldest of
eight brothers, arrived in the United States from Germany. He earned his living
as a pack peddler in Pennsylvania, and began sending for his brothers. The
Seligmans became successful merchants, establishing businesses in the South and
East.
Backed by nearly thirty years of business success - culminating in the sale
of government securities to help finance the Civil War - Joseph Seligman, with
his brothers, established the international banking and investment firm of J. &
W. Seligman & Co. In the years that followed, Seligman played a major role in
the geographical expansion and industrial development of the United States.
SELIGMAN:
.... Prior to 1900
. Helps finance America's fledgling railroads through underwriting.
. Is admitted to the New York Stock Exchange in 1869. Seligman remained a
member of the NYSE until 1993, when the evolution of its business made it
unnecessary.
. Becomes a prominent underwriter of corporate securities, including New
York Mutual Gas Light Company, later part of Consolidated Edison.
. Provides financial assistance to Mary Todd Lincoln and urges the Senate to
award her a pension.
. Is appointed U.S. Navy fiscal agent by President Grant.
. Plays a significant role in raising capital for America's industrial and
urban development.
...1900-1910
. Helps Congress finance the building of the Panama Canal.
...1910s
. Participates in raising billions for Great Britain, France and Italy,
helping finance World War I.
...1920s
. Participates in hundreds of underwritings including those for some of the
country's largest companies: Briggs Manufacturing, Dodge Brothers, General
Motors, Minneapolis-Honeywell Regulatory Company, Maytag Company, United
Artists Theater Circuit and Victor Talking Machine Company.
. Forms Tri-Continental Corporation in 1929, today the nation's largest,
diversified closed-end equity investment company, with over $2 billion in
assets, and one of its oldest.
...1930s
. Assumes management of Broad Street Investing Co. Inc., its first mutual
fund, today known as Seligman Common Stock Fund.
. Establishes Investment Advisory Service.
...1940s
. Helps shape the Investment Company Act of 1940.
. Leads in the purchase and subsequent sale to the public of Newport News
Shipbuilding and Dry Dock Company, a prototype transaction for the
investment banking industry.
. Assumes management of National Investors Corporation, today Seligman
Growth Fund.
. Establishes Whitehall Fund, Inc., today Seligman Income Fund.
-16-
<PAGE>
...1950-1989
. Develops new open-end investment companies. Today, manages 44 mutual fund
portfolios with combined assets of $7.3 billion.
. Helps pioneer state-specific, tax-exempt municipal bond funds, today
managing a national and 18 state-specific tax-exempt funds.
. Establishes J. & W. Seligman Trust Company, and J. & W. Seligman
Valuations Corporation.
. Establishes Seligman Portfolios, Inc., an investment vehicle offered
through variable annuity products.
...1990s
. Introduces Seligman Select Municipal Fund and Seligman Quality Municipal
Fund, two closed-end funds that invest in high-quality municipal
bonds.
. In 1991 establishes a joint venture with Henderson Administration Group
plc, of London, known as Seligman Henderson Co., to offer global
investment products.
. Introduces Seligman Frontier Fund, Inc., a small capitalization mutual
fund.
. Launches Seligman Henderson Global Fund Series, Inc., which today offers
three separate series: Seligman Henderson International Fund, Seligman
Henderson Global Smaller Companies Fund and Seligman Henderson Global
Technology Fund.
-17-
<PAGE>
- --------------------------------------------------------------------------------
Seligman
Communications
and
Information
Fund, Inc.
- --------------------------------------------------------------------------------
A Capital Gain Fund
- --------------------------------------------------------------------------------
12th Annual Report
1994
- --------------------------------------------------------------------------------
[Logo]
SELIGMAN FINANCIAL SERVICES, INC.
AN AFFILIATE OF
[Logo]
J. & W. SELIGMAN & CO.
INCORPORATED
ESTABLISHED 1864
100 Park Avenue,
New York, NY 10017
This report is intended only for the information of shareholders or those who
have received the offering prospectus covering shares of Capital Stock of
Seligman Communications and Information Fund, Inc., which contains information
about the sales charges, management fee, and other costs. Please read the
prospectus carefully before investing or sending money.
EQCI2 12/94
<PAGE>
- --------------------------------------------------------------------------------
Seligman Communications and Information Fund
- --------------------------------------------------------------------------------
A mutual fund that invests for capital gain primarily in the stocks of
companies engaged in meeting the growing demand for products and services in the
developing communications, information, and related industries. Income is not an
objective.
Highlights of 1994
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
December 31, 1994 December 31, 1993
-----------------------------------------
Class A Class D Class A Class D
------- ------- ------- -------
<S> <C> <C> <C> <C>
Net Assets (in thousands).................... $307,542 $96,100 $92,987 $7,833
------- ------- ------- -------
Net Asset Value per Share................... $16.64 $16.31 $13.43 $13.32
With December 1994 Gain Distribution
Taken in Shares............................. 18.17 17.84 -- --
Increase in Net Asset Value with Gain
Distribution Taken in Shares............... 35.30% 33.94% -- --
------- ------- ------- -------
Distribution of Realized Gain per Share..... $1.46 $1.46 $3.10 $3.10
------- ------- ------- -------
Total Expenses per Dollar of
Average Net Assets. $0.0165 $0.0250 $0.0163 $0.0256+
------- ------- ------- -------
</TABLE>
+ Annualized.
1
<PAGE>
- --------------------------------------------------------------------------------
To the Shareholders
- --------------------------------------------------------------------------------
We are pleased to report Seligman Communications and Information Fund's long-
term investment results, portfolio holdings, and audited financial statements at
December 31, 1994.
It is our pleasure to report that at December 31, your Fund was ranked the
number one Fund of all equity mutual funds measured by Lipper Analytical
Services for both the one- and five-year periods ended December 31, 1994, of the
2,018 and 878 funds measured, respectively. Your Fund is number two for the 10-
year period, of the 445 equity mutual funds measured. Lipper's rankings are
based on total return and do not include sales charges.
For your Fund's Class A shares, net asset value per share was $16.64 at
December 31, compared to $16.79 at September 30, and $13.43 a year ago. For your
Fund's Class D shares, net asset value per share was $16.31 at December 31,
compared to $16.53 at September 30, and $13.32 a year ago. For both Class A and
D shares, net realized gain per share from investment transactions in 1994 was
$1.46.
For your Fund's Class A shares, total return was an outstanding 8.22% for the
three months and 35.30% for the 12 months ended December 31. For your Fund's
Class D shares, total return was 7.93% and 33.94%, respectively, for the same
periods. This compares to the Standard & Poor's 500 Composite Stock Price
Index's total return of -0.02% for the three months and 1.32% for the 12 months
ended December 31. (Total return reflects change in net asset value and assumes
any distributions paid within the period are reinvested in additional shares.
Class A returns do not, however, reflect the effect of the maximum initial sales
charge of 4.75%, and Class D returns do not reflect the effect of the 1%
contingent deferred sales load.)
Looking back on 1994, the one generalization that can be made with confidence
is that it was a turbulent and trying year for equity and bond investors alike.
The Federal Reserve Board exhibited an aggressive stance against inflation,
putting through six short-term interest rate increases by the end of the year.
This caused an upheaval in the bond market, with yields increasing and bond
prices spiraling lower--an event in the financial markets unmatched in magnitude
since 1973-74. The equity market remained hostage to the bond market and
demonstrated lackluster performance for the year.
The U.S. economy continued to grow at a modest yet controlled pace,
accompanied by corporate news of solid growth and strong earnings. This economic
news, although positive, caused the underlying question to remain: Will the
economy overheat, opening the door to increased inflation? We don't believe so.
We believe an economic slowdown is close at hand. In March of 1995, the
current growth cycle will mark its fourth year. The consumer has both increased
debt as a percentage of income and drawn down savings--suggesting nearer-term
caution after a stronger-than-expected pattern of spending in 1994. We also
believe that inflation will remain under control in light of intense global
competition, low unit labor costs, and an aging population that should favor
saving over spending. Job creation remains robust despite gains in productivity,
and U.S. competitiveness in world markets is likely to be enhanced under
G.A.T.T.--General Agreement on Tariffs and Trade.
<PAGE>
Please refer to page 4 for a discussion with your Portfolio Manager about your
Fund's strong performance in 1994, followed by the chart and table that analyze
longer-term performance.
For more information about Seligman Communications and Information Fund, or
your investment in its shares, please write or call the toll-free telephone
numbers listed on page 18.
By order of the Board of Directors,
/s/ William C. Morris
William C. Morris
Chairman
/s/ Ronald T. Schroeder
Ronald T. Schroeder
President
February 3, 1995
2
<PAGE>
- --------------------------------------------------------------------------------
Seligman Communications and Information Fund
- --------------------------------------------------------------------------------
Federal Tax Status of
1994 Gain Distribution
For Taxable Accounts
The distribution of $1.46 per share, consisting of $0.39 from net long-term gain
and $1.07 from net short-term gain, realized on investment transactions during
1994, was paid on December 20, 1994, to both Class A and D shareholders.
The long-term gain distribution is designated a "capital gain dividend" for
federal income tax purposes and is taxable to shareholders in 1994 as a long-
term gain from the sale of capital assets, no matter how long you may have owned
your shares or whether the distribution was received in shares or in cash.
However, if shares on which a capital gain distribution was received are
subsequently sold, and such shares have been held for six months or less from
date of purchase, any loss would be treated as long-term to the extent that it
offsets the long-term gain distribution. The net short-term gain is taxable as
ordinary income whether paid to you in shares or in cash.
If the distribution was received in shares, the per share cost basis for
federal income tax purposes is $15.87 for Class A and $15.56 for Class D. The
tax cost basis of shares previously held is not affected.
A year-end statement of account showing activity for 1994 has been mailed to
each shareholder. Under "Tax Information for Calendar Year," it shows the
proceeds of any redemptions paid to the shareholder during the year and reported
to the Internal Revenue Service as required by federal regulations (Form 1099-
B). In addition, a separate Form 1099-DIV showing the amount of the distribution
from gain on investments paid during the year has been mailed to each
shareholder.
3
<PAGE>
- --------------------------------------------------------------------------------
Annual Performance Overview
- --------------------------------------------------------------------------------
The following is a biography of your Portfolio Manager, a discussion with him
regarding Seligman Communications and Information Fund, and a comparison chart
of your Fund's performance against the Standard & Poor's 500 Composite Stock
Price Index and the Lipper Science and Technology Fund Average.
Your Portfolio Manager
[photograph]
Paul H. Wick is a Managing Director and Vice President of J. & W. Seligman & Co.
Incorporated and the Portfolio Manager of Seligman Communications and
Information Fund. Mr. Wick joined Seligman in 1987 as an Associate, Investment
Research, and from April 1989 to December 1989 was Co-Portfolio Manager of
Seligman High-Yield Bond Series. He has been Portfolio Manager of Seligman
Frontier Fund since August 1991, and Seligman Communications and Information
Fund since December 1989.
Economic Factors Affecting Seligman Communications and Information Fund
"In 1994, technology stocks as a group benefited from the strong global demand
for the key technology `end markets:' personal computers; networking;
telecommunications equipment; software; and wireless communications. In turn,
the strength of these markets created a healthy climate for their suppliers:
contract manufacturers; semiconductor companies; and suppliers of capital
equipment to the electronics market. In general, every industry involved in the
technology `end markets' thrived, from the providers of parts and manufacturers
of equipment, to the suppliers of the final product."
Your Manager's Investment Strategy
"As in 1993, your Fund's emphasis this past year on investing in fast-growing
companies that demonstrate the potential for positive earnings surprises proved
quite rewarding. We believe that the secular bull market for technology
experienced thus far in the 1990s will continue through this decade. The
industry is benefiting from both the capital investment cycle that is driving
the current economic expansion, and the information-driven revolution that has
been unfolding. Technology continues to dominate the office, the factory, the
home, and the transportation and entertainment industries; as a result it will
continue to capture a greater share of corporate and consumer spending over
time.
"While in the past your Fund's holdings included those industries that benefit
from technology, such as media, broadcasting, and entertainment, in recent years
we have focused heavily on the industries that create and supply communications
and technology products, as they continue to show the greatest growth
potential."
Individual Sector Performance
"The notable outperformance of your Fund was due largely to successful
investments made in the semiconductor and semiconductor capital equipment
industries. These areas did particularly well through the first nine months of
the year before fading somewhat in the fourth quarter. Fortunately, in September
and October, we locked in profits by selling several richly valued semiconductor
capital equipment holdings, including Ultratech Stepper. We also took profits in
some of our big winners in the networking industry, such as Alantec; however,
the networking group as a whole continued to appreciate in value as the year
progressed. In addition, due to the healthy demand for technology products, the
contract manufacturing sector also performed strongly, as these companies
assemble the sub-systems necessary for finished technology products."
Looking Ahead
"We believe 1995 will be an advantageous environment for technology issues. More
specifically, the overall technology industry, and your Fund in particular,
should benefit from the increased spending associated with two key events: the
emergence of the Intel Pentium chip in the mainstream of the PC market, and the
launch of Microsoft's new operating system for PCs-- Windows95. Because these
advances in the computer market will continually demand upgraded products and
services, every industry involved in the process of manufacturing PCs should
benefit, which bodes well for your Fund's investments."
4
<PAGE>
- --------------------------------------------------------------------------------
Ten-Year Performance Comparison Chart and Table December 31, 1994
- --------------------------------------------------------------------------------
This chart compares a $10,000 hypothetical investment made in Seligman
Communications and Information Fund Class A shares, with and without the maximum
initial sales charge of 4.75%, for the 10-year period ended December 31, 1994,
to a $10,000 hypothetical investment made in the Standard & Poor's 500 Composite
Stock Price Index (S&P 500) and the Lipper Science and Technology Fund Average
(Lipper Science & Technology) for the same period. The performance of Seligman
Communications and Information Fund Class D shares is not shown in this chart,
but is included in the table below. It is important to keep in mind that the S&P
500 excludes the effect of any fees or sales charges, and the Lipper Science &
Technology excludes the effects of any sales charges.
(Ten-Year Performance Comparison Chart represented in tabular format below)
<TABLE>
<CAPTION>
Seligman Seligman
Communications Communications
& Information & Information Lipper
Fund Fund Science S&P 500
without with & Technology Stock
FYE sales charge sales charge Fund Index Index
-- ------------ ------------ ---------- -----
<S> <C> <C> <C> <C>
12/31/84...... $ 9,522.00 $10,000.00 $10,000.00 $10,000.00
12/31/85...... 12,778.00 13,419.00 12,402.88 13,164.00
12/31/86...... 14,904.00 15,652.00 13,465.10 15,615.00
12/31/87...... 17,141.00 18,002.00 14,001.89 16,424.00
12/31/88...... 19,322.00 18,398.00 15,178.87 19,133.00
12/31/89...... 25,141.00 23,940.00 18,969.02 25,177.00
12/31/90...... 22,358.00 21,289.00 18,592.36 24,393.00
12/31/91...... 34,634.00 32,978.00 27,162.83 31,793.00
12/31/92...... 40,630.00 38,688.00 31,203.82 34,212.00
12/31/93...... 54,901.00 52,277.00 39,076.64 37,645.00
12/31/94...... 74,281.00 70,731.00 43,481.62 38,334.00
</TABLE>
The table below shows the average annual total returns for the one-year, five-
year, and 10-year periods through December 31, 1994, for the Seligman
Communications and Information Fund Class A shares, with and without the maximum
initial sales charge of 4.75%, the S&P 500, and the Lipper Science & Technology.
Also included in the table are the average annual total returns for the one-year
<PAGE>
and since-inception periods through December 31, 1994, for the Seligman
Communications and Information Fund Class D shares, with and without the effect
of the 1% contingent deferred sales load ("CDSL") imposed on shares redeemed
within one year of purchase, the S&P 500, and the Lipper Science & Technology.
AVERAGE ANNUAL TOTAL RETURNS
<TABLE>
<CAPTION>
One Five Ten
Year Years Years
---- ----- -----
<S> <C> <C> <C>
Seligman Communications and
Information Fund
Class A with sales charge 28.87% 23.00% 21.61%
Class A without sales charge 35.30 24.19 22.20
S&P 500 1.32 8.70 14.34
Lipper Science & Technology 11.27 18.05 15.83
</TABLE>
<TABLE>
<CAPTION>
Since
One Inception
Year 5/3/93
---- ------
<S> <C> <C>
Seligman Communications and
Information Fund
Class D with CDSL 32.94% N/A
Class D without CDSL 33.94 42.72%
S&P 500 1.32 5.59
Lipper Science & Technology 11.27 19.16
</TABLE>
No adjustment was made to performance for periods prior to January 1, 1993, the
commencement date for the annual Administration, Shareholder Services and
Distribution Plan fee of up to 0.25% of average daily net assets of Class A
shares. The performance of Class D shares will be greater than or less than the
performance shown for Class A shares, based on the differences in sales charges
and fees paid by shareholders. Performance data quoted represent changes in
prices and assume that all distributions within the periods are invested in
additional shares. The investment return and principal value of an investment
will fluctuate so that shares, if redeemed, may be worth more or less than their
original cost. Past performance is not indicative of future investment results.
5
<PAGE>
- --------------------------------------------------------------------------------
Seligman Communications and Information Fund
- --------------------------------------------------------------------------------
Diversification of Assets December 31, 1994
<TABLE>
<CAPTION>
Percent Percent of
0f Net Net Assets
Issues Cost Value Assets Dec. 31, 1993
------ --- ----- ------ -------------
<S> <C> <C> <C> <C> <C>
Net Cash and Short-Term Holdings........ 2 $ 32,917,345 $ 32,917,345 8.2 1.4
-- ------------ ------------ ----- ----
Common Stocks:
Broadcasting and entertainment.......... -- -- -- -- 1.6
Computer hardware/peripherals........... 4 40,139,440 49,973,438 12.4 12.3
Computer software....................... 14 65,940,127 76,223,125 18.9 13.9
Contract manufacturing.................. 3 14,098,120 19,790,625 4.9 2.2
Information services.................... 2 11,232,824 11,752,500 2.9 3.2
Networking.............................. 4 21,820,685 26,839,375 6.6 15.8
Semiconductors.......................... 13 75,348,353 90,692,500 22.5 15.9
Semiconductor capital equipment......... 14 79,867,222 93,403,125 23.1 30.6
Telecommunications...................... 1 2,280,830 2,050,000 0.5 3.1
-- ------------ ------------ ----- -----
55 310,727,601 370,724,688 91.8 98.6
-- ------------ ------------ ----- -----
Net Assets ............................ 57 $343,644,946 $403,642,033 100.0 100.0
== ============ ============ ===== =====
</TABLE>
6
<PAGE>
- --------------------------------------------------------------------------------
Seligman Communications and Information Fund
- --------------------------------------------------------------------------------
LARGEST PORTFOLIO CHANGES*
During Past Three Months
<TABLE>
<CAPTION>
Shares
------------------
Holdings
Additions Increase 12/31/94
- ------- ------- --------
<S> <C> <C>
Applied Materials............... 120,000 180,000
Compuware....................... 155,000 275,000
Dell Computer................... 125,000 125,000
Electroglas..................... 195,000 270,000
Electronics for Imaging......... 400,000 600,000
Exar............................ 240,000 400,000+
Fusion Systems.................. 200,000 200,000
Lam Research.................... 180,000 365,000
Parametric Technology........... 200,000 500,000
Western Digital................. 300,000 600,000
</TABLE>
<TABLE>
<CAPTION>
Holdings
Reductions Decrease 12/31/94
- ---------- -------- --------
<S> <C> <C>
Alantec......................... 220,000 --
Corel........................... 390,000++ --
Gasonics International.......... 200,000 --
Informix........................ 130,000 --
Newbridge Networks.............. 125,000 --
Novellus Systems................ 100,000 --
Tencor Instruments.............. 98,000 80,000
Triconex........................ 140,000 --
Ultratech Stepper............... 80,000 --
Xyplex.......................... 200,000 --
</TABLE>
__________________
* Largest portfolio changes from the previous quarter to the current quarter
are based on cost of purchases and proceeds from sales of securities.
+ Includes 60,000 shares received as a result of a 3-for-2 stock split.
++ Includes 130,000 shares received as a result of a 2-for-1 stock split.
<TABLE>
<CAPTION>
MAJOR PORTFOLIO HOLDINGS
at December 31, 1994
Security Value
- -------- -----
<S> <C>
EMC............................. $18,381,250
Parametric Technology........... 17,187,500
Electronics for Imaging......... 16,425,000
Lam Research.................... 13,550,626
Advanced Micro Devices.......... 12,437,500
Cognex.......................... 10,450,000
DSC Communications.............. 10,097,500
Xilinx.......................... 10,051,250
Western Digital................. 10,050,000
Linear Technology............... 9,875,000
</TABLE>
7
<PAGE>
- -------------------------------------------------------------------------------
Portfolio of Investments December 31, 1994
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Shares Value
------ -----
<S> <C> <C>
Common Stocks -- 91.8%
Computer Hardware/Peripherals -- 12.4%
Dell Computer*
Developer and manufacturer of
IBM-compatible PCs............. 125,000 $ 5,117,188
Electronics for Imaging*
Color copier servers........... 600,000 16,425,000
EMC*
Mainframe storage devices...... 850,000 18,381,250
Western Digital*
Manufacturer of disk drives.... 600,000 10,050,000
----------
49,973,438
----------
Computer Software -- 18.9%
Applied Voice Technology*
Communications management
software....................... 100,000 1,656,250
Aspen Technology*
Computer-aided chemical
engineering software........... 200,000 3,887,500
Compuware*
Mainframe system software...... 275,000 9,865,625
Epic Design Technology*
Integrated circuit design
software....................... 125,000 2,781,250
Hummingbird Communications*
X-Windows networking
software....................... 100,000 2,018,750
Integrated Silicon Systems*
Integrated circuit design
verification software......... 200,000 6,100,000
MapInfo*
Developer of desktop mapping
software...................... 230,000 5,836,250
Microtec Research*
Developer of real-time
operating system software..... 150,000 1,312,500
Parametric Technology*
Developer of mechanical design
software...................... 500,000 17,187,500
Quickturn Design Systems*
Integrated circuit emulation
systems....................... 450,000 6,103,125
Synopsys*
Integrated circuit design
software...................... 170,000 7,395,000
Viewlogic Systems*
Integrated circuit design
software...................... 360,000 6,615,000
Wavefront Technology*
Multimedia authoring
software...................... 170,000 2,114,375
Wonderware*
Factory automation
software...................... 100,000 3,350,000
------- ----------
76,223,125
----------
Contract Manufacturing -- 4.9%
Altron*
Manufacturer of electronic
circuit boards................ 170,000 4,143,750
Merix*
Manufacturer of electronic
circuit boards................ 250,000 6,296,875
Sanmina*
Manufacturer of electronic
circuit boards................ 340,000 9,350,000
------- ----------
19,790,625
----------
Information Services--2.9%
SPS Transaction Services*
Credit card processing
services..................... 200,000 5,250,000
SunGard Data Systems*
Computer services aimed at
disaster recovery............ 170,000 6,502,500
------- ----------
11,752,500
----------
Networking--6.6%
Cisco Systems*
Computer network routers...... 150,000 5,259,375
DSC Communications*
Digital telephone switching
systems....................... 280,000 10,097,500
Standard Microsystems*
Local area network
equipment..................... 210,000 6,326,250
3COM*
Supplier of adapter cards,
hubs, and routers for local
area computer networks........ 100,000 5,156,250
------- ----------
26,839,375
----------
Semiconductors--22.5%
Advanced Micro Devices*
Microprocessors and FLASH
memory circuits............... 500,000 12,437,500
Alliance Semiconductor*
Manufacturer of high-
performance memory products... 100,000 3,137,500
Altera*
Field programmable logic
devices....................... 200,000 8,362,500
Arrow Electronics*
Largest distributor of
semiconductors and other
electronic components......... 130,000 4,663,750
Bell Microproducts*
Distributor of electronic
components.................... 250,000 2,750,000
Cyprus Semiconductor*
Manufacturer of memory
circuits...................... 300,000 6,937,500
Exar*
Mixed signal integrated
circuits...................... 400,000 9,700,000
Integrated Device Technology*
Manufacturer of memory
circuits and
microprocessors............... 300,000 8,868,750
</TABLE>
8
- --------------------------------------------------------------------------------
Portfolio of Investments (Continued) December 31, 1994
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Principal
Amount
or Shares Value
--------- ------------
<S> <C> <C>
Linear Technology
Analog integrated circuits.... 200,000 $ 9,875,000
Microchip Technology*
Field programmable
microcontrollers.............. 200,000 5,475,000
Motorola
Manufacturer of semiconductors
and communications
equipment..................... 90,000 5,208,750
Tower Semiconductor*
Semiconductor foundry
services...................... 300,000 3,225,000
Xilinx*
Field programmable gate
arrays........................ 170,000 10,051,250
------- ----------
90,692,500
----------
Semiconductor Capital Equipment -- 23.1%
Applied Materials*
World's largest supplier of
semiconductor fabrication
equipment..................... 180,000 7,560,000
Asyst Technologies*
Miniature clean-room
environment devices for the
manufacture of silicon
wafers........................ 220,000 5,252,500
Cognex*
Manufacturer of machine vision
systems....................... 400,000 10,450,000
Credence Systems*
Semiconductor test
equipment..................... 330,000 7,548,750
Electroglas*
Manufacturer of semiconductor
probe test equipment.......... 270,000 9,045,000
Electro Scientific*
Computer-controlled laser
systems....................... 250,000 5,375,000
FSI International*
Manufacturer of semiconductor
production equipment.......... 300,000 8,137,500
Fusion Systems*
Manufacturer of ultraviolet
curing systems................ 200,000 5,175,000
KLA Instruments*
Wafer inspection devices...... 100,000 4,912,500
Lam Research*
Manufacturer of plasma-etching
equipment..................... 365,000 13,550,625
Mattson Technology*
Photo-resist strip
equipment..................... 200,000shs. 3,875,000
PRI Automation*
Automated transport and
storage equipment for
silicon wafers................ 250,000 4,031,250
Tencor Instruments*
Wafer inspection devices...... 80,000 3,070,000
Teradyne*
Semiconductor test
equipment..................... 160,000 5,420,000
------- ----------
93,403,125
----------
Telecommunications -- 0.5%
Telefonos de Mexico, S.A. (ADRs)
Telephone services in
Mexico........................ 50,000 2,050,000
------- -----------
Total Common Stocks
(Cost $310,727,601)........... _______ 370,724,688
-----------
</TABLE>
<PAGE>
<TABLE>
<S> <C> <C>
Short-Term Holdings -- 5.3%
Canadian Imperial Bank
of Commerce,
Grand Cayman,
Fixed Time Deposit,
5 1/4%,
1/3/1995 ...................... $10,095,000 10,095,000
First National Bank of Chicago,
Grand Cayman,
Fixed Time Deposit,
5 3/4%,
1/3/1995 ...................... 11,000,000 11,000,000
-----------
Total Short-Term Holdings
(Cost $21,095,000)............. 21,095,000
-----------
Total Investments--97.1%
(Cost $331,822,601) ........... 391,819,688
Other Assets Less
Liabilities--2.9% ........... 11,822,345
------------
Net Assets--100.0% ............ $403,642,033
============
</TABLE>
- -------------------
* Non-income producing security.
Descriptions of companies have not been audited
by Deloitte & Touche LLP.
See notes to financial statements.
9
<PAGE>
- --------------------------------------------------------------------------------
Statement of Assets and Liabilities December 31, 1994
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
<S> <C> <C>
Assets:
Investments, at value:
Common stocks (cost $310,727,601)....................... $370,724,688
Short-term holdings (cost $21,095,000).................. 21,095,000 $391,819,688
------------
Receivable for Capital Stock sold......................... 9,844,771
Receivable for securities sold............................ 6,944,788
Expenses prepaid to shareholder service agent............. 100,445
Receivable for interest and dividends..................... 15,458
Other..................................................... 4,831
-----------
Total Assets ............................................. 408,729,981
===========
Liabilities:
Payable for Capital Stock repurchased..................... 3,475,750
Payable to custodian...................................... 427,376
Payable for securities purchased.......................... 399,161
Accrued expenses, taxes, and other........................ 785,661
-------
Total Liabilities ........................................ 5,087,948
------------
Net Assets ............................................... $403,642,033
============
Composition of Net Assets:
Capital Stock, at par ($.10 par value; 50,000,000 shares authorized;
24,377,113 shares outstanding):
Class A.................................................. $ 1,848,621
Class D.................................................. 589,090
Additional paid-in capital................................ 341,304,632
Accumulated net investment loss........................... (74,028)
Distribution in excess of net realized gain............... (23,369)
Net unrealized appreciation of investments................ 59,997,087
-----------
Net Assets ............................................... $403,642,033
-----------
Net Asset Value per share:
Class A ($307,542,510 divided by 18,486,212 shares) ...... $16.64
======
Class D ($96,099,523 divided by 5,890,901 shares) ........ $16.31
======
</TABLE>
- -----------------
See notes to financial statements.
10
<PAGE>
- --------------------------------------------------------------------------------
Statement of Operations For the Year Ended December 31, 1994
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
<S> <C>
Investment income:
Dividends.................................................................. $621,250
Interest................................................................... 133,145
--------
Total investment income.................................................... $754,395
Expenses:
Management fee............................................................. 1,547,256
Shareholder account services............................................... 1,016,786
Distribution and service fees.............................................. 759,996
Registration............................................................... 178,631
Custody and related services............................................... 66,461
Shareholder reports and communications..................................... 60,647
Auditing and legal fees.................................................... 50,431
Shareholders' meeting...................................................... 39,585
Directors' fees and expenses............................................... 29,718
Miscellaneous.............................................................. 10,092
---------
Total expenses............................................................. 3,759,603
Net investment loss ....................................................... (3,005,208)
Net realized and unrealized gain on investments: ---------
Net realized gain on investments........................................... 33,339,790
Net change in unrealized appreciation of investments....................... 37,888,691
Net gain on investments ................................................... 71,228,481
----------
Increase in net assets from operations .................................... $68,223,273
===========
</TABLE>
- -----------------
See notes to financial statements.
11
<PAGE>
- --------------------------------------------------------------------------------
Statements of Changes in Net Assets
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Year Ended December 31
-------------------------
1994 1993
---- ----
<S> <C> <C>
Operations:
Net investment loss..................................... (3,005,208) $ (993,967)
Net realized gain on investments........................ 33,339,790 19,573,503
Net change in unrealized appreciation of investments.... 37,888,691 3,822,923
---------- ----------
Increase in net assets from operations.................. 68,223,273 22,402,459
---------- ----------
Distributions to shareholders:
Net realized gain on
investments:
Class A................................................ (23,057,467) (17,263,490)
Class D................................................ (7,378,956) (1,332,122)
---------- ----------
Decrease in net assets from distributions (30,436,423) (18,595,612)
---------- ----------
</TABLE>
<TABLE>
<CAPTION>
Shares
Year Ended December 31
-------------------------
Capital share transactions:* 1994 1993
---- ----
Net proceeds from sale of shares:
<S> <C> <C> <C> <C>
Class A........................ 12,396,364 2,087,022 195,352,500 30,602,382
Class D........................ 5,185,338 510,549 79,228,846 7,608,582
Exchanged from associated Funds:
Class A........................ 1,170,239 194,947 18,474,544 2,814,238
Class D........................ 203,970 6,443 3,154,851 84,503
Shares issued in payment of
gain distributions:
Class A........................ 1,333,850 1,212,594 21,167,404 15,824,437
Class D........................ 446,619 95,461 6,950,002 1,235,257
----------- ----------- ----------- -----------
Total........................... 20,736,380 4,107,016 324,328,147 58,169,399
----------- ----------- ----------- -----------
Cost of shares repurchased:
Class A........................ (2,961,042) (986,490) (45,094,262) (14,587,172)
Class D........................ (281,622) (8,757) (4,346,535) (129,786)
Exchanged into associated Funds:
Class A........................ (376,738) (220,542) (5,958,943) (3,200,128)
Class D........................ (251,365) (15,735) (3,893,730) (239,390)
----------- ----------- ----------- -----------
Total........................... (3,870,767) (1,231,524) (59,293,470) (18,156,476)
----------- ----------- ----------- -----------
Increase in net assets from
capital
share transactions............ 16,865,613 2,875,492 265,034,677 40,012,923
=========== =========== =========== ===========
Increase in net assets..................................................... 302,821,527 43,819,770
Net Assets:
Beginning of year.......................................................... 100,820,506 57,000,736
----------- -----------
End of year (including accumulated net investment loss of
$74,028 and $75,497, respectively)...................................... $403,642,033 $100,820,506
=========== ===========
</TABLE>
- -----------------
* The Fund began offering Class D shares on May 3, 1993. See notes to financial
statements.
12
<PAGE>
- ------------------------------------------------------------------------
Notes to Financial Statements
- ------------------------------------------------------------------------
1. Effective May 3, 1993, Seligman Communications and Information Fund, Inc.
(the "Fund") began offering two classes of shares. All shares existing prior to
May 3, 1993, have been classified as Class A shares. Class A shares are sold
with an initial sales charge of up to 4.75% and a continuing service fee of up
to 0.25% on an annual basis. Class D shares are sold without an initial sales
charge but are subject to a higher distribution fee and a contingent deferred
sales load ("CDSL") of 1% imposed on certain redemptions made within one year of
purchase. The two classes of shares represent interests in the same portfolio of
investments, have the same rights and are generally identical in all respects
except that each class bears its separate distribution and certain class
expenses and has exclusive voting rights with respect to any matter to which a
separate vote of any class is required.
2. Significant accounting policies followed, all in conformity with generally
accepted accounting principles, are given below:
a. Investments in common stocks are valued at current market values or, in
their absence, at fair value determined in accordance with procedures
approved by the Board of Directors. Securities traded on national
exchanges are valued at last sales prices or, in their absence and in the
case of over-the-counter securities, a mean of bid and asked prices.
Short-term holdings maturing in 60 days or less are valued at amortized
cost.
b. There is no provision for federal income or excise tax. The Fund has
elected to be taxed as a regulated investment company and intends to
distribute substantially all taxable net income and net gain realized.
c. Investment transactions are recorded on trade dates. Identified cost of
investments sold is used for both financial statement and federal income
tax purposes. Dividends receivable and payable are recorded on ex-dividend
dates. Interest income is recorded on an accrual basis.
d. All income, expenses (other than class-specific expenses), and realized
and unrealized gains or losses are allocated daily to each class of shares
based upon the relative proportion of the value of shares outstanding of
each class. Class-specific expenses, which include distribution and
service fees and any other items that can be specifically attributed to a
particular class, are charged directly to such class.
e. The treatment for financial statement purposes of distributions made
during the year from net investment income or net realized gains may
differ from their ultimate treatment for federal income tax purposes.
These differences are caused primarily by differences in the timing of the
recognition of certain components of income, expense, or capital gain for
federal income tax purposes. Where such differences are permanent in
nature, they are reclassified in the components of net assets based on
their ultimate characterization for federal income tax purposes. Any such
reclassification will have no effect on net assets, results of operations,
or net asset value per share of the Fund.
3. Purchases and sales of portfolio securities, excluding short-term
investments, for the year ended December 31, 1994, amounted to $404,879,349 and
$204,781,130, respectively.
At December 31, 1994, the cost of investments for federal income tax purposes
was substantially the same as the cost for financial reporting purposes, and the
tax basis gross unrealized appreciation and depreciation of portfolio securities
amounted to $63,546,002 and $3,572,284, respectively.
4. J. & W. Seligman & Co. Incorporated (the "Manager") manages the affairs of
the Fund and provides the necessary personnel and facilities. Compensation of
all officers of the Fund, all directors of the Fund who are employees or
consultants of the Manager, and all personnel of the Fund and the Manager is
paid by the Manager. The Manager receives a fee, calculated daily and payable
monthly, equal to 0.75% per annum of the Fund's average daily net assets.
13
<PAGE>
- ------------------------------------------------------------------------
Notes to Financial Statements (continued)
- ------------------------------------------------------------------------
Seligman Financial Services, Inc. (the "Distributor"), agent for the
distribution of Fund shares and an affiliate of the Manager, received
commissions of $693,835 from sales of Class A shares, after concessions of
$5,926,699 paid to dealers.
Effective January 1, 1993, the Fund adopted an Administration, Shareholder
Services and Distribution Plan (the "Plan") with respect to Class A shares under
which service organizations can enter into agreements with the Distributor and
receive a continuing fee of up to 0.25% on an annual basis, payable quarterly,
of the average daily net assets of the Class A shares attributable to the
particular service organizations for providing personal services and/or the
maintenance of shareholder accounts. The Distributor charges such fees to the
Fund pursuant to the Plan. For the year ended December 31, 1994, fees paid
aggregated $346,469, or 0.21% per annum of the average daily net assets of Class
A shares.
Effective May 3, 1993, the Fund adopted a Plan with respect to Class D shares
under which service organizations can enter into agreements with the Distributor
and receive a continuing fee for providing personal services and/or the
maintenance of shareholder accounts of up to 0.25% on an annual basis of the
average daily net assets of the Class D shares for which the organizations are
responsible, and fees for providing other distribution assistance of up to 0.75%
on an annual basis of such average daily net assets. Such fees are paid monthly
by the Fund to the Distributor pursuant to the Plan. For the year ended December
31, 1994, fees paid amounted to $413,527, or 1% per annum of the average daily
net assets of Class D shares.
The Distributor is entitled to retain any CDSL imposed on certain redemptions
occurring within one year of purchase. For the year ended December 31, 1994,
such charges amounted to $34,431.
Seligman Data Corp., owned by certain associated investment companies,
charged the Fund at cost $1,016,432 for shareholder account services.
Certain officers and directors of the Fund are officers or directors of the
Manager, the Distributor, and/or Seligman Data Corp.
Fees of $14,500 were incurred by the Fund for legal services of Sullivan &
Cromwell, a member of which firm is a director of the Fund.
The Fund has a compensation arrangement under which directors who receive
fees may elect to defer receiving such fees. Interest is accrued on the deferred
balances. The annual cost of such fees and interest is included in directors'
fees and expenses, and the accumulated balance thereof at December 31, 1994, of
$74,028 is included in other liabilities. Deferred fees and the related accrued
interest are not deductible for federal income tax purposes until such amounts
are paid.
5. Class-specific expenses charged to Class A and Class D during the year ended
December 31, 1994, which are included in the corresponding captions of the
Statement of Operations, were as follows:
<TABLE>
<CAPTION>
Class A Class D
------- -------
<S> <C> <C>
Distribution and service fees... $346,469 $413,527
Registration.................... 91,853 51,307
Shareholder reports and
communications................ 13,317 2,385
Shareholders' meeting........... 11,840 1,970
</TABLE>
14
<PAGE>
- --------------------------------------------------------------------------------
Financial Highlights
- --------------------------------------------------------------------------------
The Fund's financial highlights are presented below. The per share operating
performance data is designed to allow investors to trace the operating
performance, on a per share basis, from the Fund's beginning net asset value to
the ending net asset value so that they can understand what effect the
individual items have on their investment, assuming it was held throughout the
period. Generally, the per share amounts are derived by converting the actual
dollar amounts incurred for each item, as disclosed in the financial statements,
to their equivalent per share amount.
The total return based on net asset value measures the Fund's performance
assuming investors purchased Fund shares at net asset value as of the beginning
of the period, reinvested dividends and capital gains paid at net asset value,
and then sold their shares at the net asset value per share on the last day of
the period. The total return computations do not reflect any sales charges
investors may incur in purchasing or selling shares of the Fund. The total
returns for periods of less than one year are not annualized.
<TABLE>
<CAPTION>
Class A Class D
------------------------------------------------- ---------------------
Year 5/3/93*
Year Ended December 31 Ended to
-------------------------------------------------
1994** 1993 1992 1991 1990 12/31/94** 12/31/93
-------- ------- ------- ------- -------- ------- --------
<S> <C> <C> <C> <C> <C> <C> <C>
Per Share Operating Performance:
Net asset value, beginning
of period...................................... $ 13.43 $ 12.30 $ 11.57 $ 8.87 $ 10.11 $ 13.32 $ 12.24
-------- ------- ------- ------- -------- ------- --------
Net investment loss............................. (.19) (.14) (.12) (.12) (.08) (.33) (.05)
Net realized and unrealized
investment gain (loss)......................... 4.86 4.37 2.09 4.87 (1.04) 4.78 4.23
-------- ------- ------- ------- -------- ------- ----------
Increase (decrease) from
investment operations.......................... 4.67 4.23 1.97 4.75 (1.12) 4.45 4.18
Distributions from
net gain realized.............................. (1.46) (3.10) (1.24) (2.05) (.12) (1.46) (3.10)
-------- ------- ------- ------- -------- ------- ----------
Net increase (decrease) in
net asset value................................ 3.21 1.13 .73 2.70 (1.24) 2.99 1.08
-------- ------- ------- ------- -------- ------- ----------
Net asset value, end of period. $ 16.64 $ 13.43 $ 12.30 $ 11.57 $ 8.87 $ 16.31 $ 13.32
======== ======= ======= ======= ======== ======= ==========
Total return based
on net asset value............................. 35.30% 35.13% 17.31% 54.91% (11.07)% 33.94% 34.89%
Ratios/Supplemental Data:
Expenses to average net assets. 1.65% 1.63% 1.51% 1.69% 1.67% 2.50% 2.56%+
Net investment loss to average
net assets..................................... (1.27)% (1.39)% (1.18)% (1.23)% (.83)% (2.20)% (2.33)%+
Portfolio turnover.............................. 104.08% 137.10% 110.42% 107.72% 85.56% 104.08% 137.10%++
Net assets, end of period
(000's omitted)................................ $307,542 $92,987 $57,001 $50,175 $35,292 $96,100 $7,833
</TABLE>
_____________________
*Commencement of offering of Class D shares.
**Per share amounts for the year ended December 31, 1994, are calculated based
on average shares outstanding.
+Annualized.
++For the year ended December 31, 1993.
See notes to financial statements.
15
<PAGE>
- --------------------------------------------------------------------------------
Report of Independent Auditors
- --------------------------------------------------------------------------------
The Board of Directors and Shareholders,
Seligman Communications and Information Fund, Inc.:
We have audited the accompanying statement of assets and liabilities, including
the portfolio of investments, of Seligman Communications and Information Fund,
Inc. as of December 31, 1994, the related statements of operations for the year
then ended and of changes in net assets for each of the years in the two-year
period then ended, and the fi-nancial highlights for each of the periods
presented. These financial statements and financial highlights are the
responsibility of the Fund's management. Our responsibility is to express an
opinion on these financial statements and financial highlights based on our
audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of
December 31, 1994 by correspondence with the Fund's custodian and brokers; where
replies were not received from brokers, we performed other auditing procedures.
An audit also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.
In our opinion, such financial statements and financial highlights present
fairly, in all material respects, the financial position of Seligman
Communications and Information Fund, Inc. as of December 31, 1994, the results
of its operations, the changes in its net assets, and the financial highlights
for the respective stated periods, in conformity with generally accepted
accounting principles.
/s/ DELOITTE & TOUCHE LLP
---------------------
DELOITTE & TOUCHE LLP
New York, New York
February 3, 1995
16
<PAGE>
- --------------------------------------------------------------------------------
Board of Directors
- --------------------------------------------------------------------------------
Fred E. Brown
Director and Consultant,
J. & W. Seligman & Co. Incorporated
Alice S. Ilchman 3
President, Sarah Lawrence College
Trustee, Committee for Economic Development
Director, NYNEX
Trustee, The Rockefeller Foundation
John E. Merow
Partner, Sullivan & Cromwell, Attorneys
Betsy S. Michel 2
Director or Trustee,
Various Organizations
William C. Morris 1
Chairman
Chairman of the Board and President,
J. & W. Seligman & Co. Incorporated
Chairman, Carbo Ceramics Inc.
Director, Daniel Industries, Inc.
Director, Kerr-McGee Corporation
Douglas R. Nichols, Jr. 2
Management Consultant
______________
Member: 1 Executive Committee
2 Audit Committee
3 Director Nominating Committee
James C. Pitney 3
Partner, Pitney, Hardin, Kipp & Szuch, Attorneys
Director, Public Service Enterprise Group
James Q. Riordan 3
Director, The Brooklyn Union Gas Company
Trustee, Committee for Economic Development
Director, Dow Jones & Co., Inc.
Director, Public Broadcasting Service
Herman J. Schmidt 2
Director, H.J. Heinz Company
Director, HON Industries, Inc.
Director, MAPCO, Inc.
Ronald T. Schroeder 1
Managing Director, J. & W. Seligman & Co. Incorporated
Robert L. Shafer 3
Vice President, Pfizer Inc.
Director, USLIFE Corporation
James N. Whitson 2
Executive Vice President and Director,
Sammons Enterprises, Inc.
Director, C-SPAN
Brian T. Zino 1
Managing Director, J. & W. Seligman & Co. Incorporated
17
<PAGE>
- --------------------------------------------------------------------------------
Executive Officers
- --------------------------------------------------------------------------------
William C. Morris
Chairman
Ronald T. Schroeder
President
Paul H. Wick
Vice President
Lawrence P. Vogel
Vice President
Thomas G. Rose
Treasurer
Frank J. Nasta
Secretary
- --------------------------------------------------------------------------------
Manager
J. & W. Seligman & Co. Incorporated
100 Park Avenue
New York, NY 10017
General Counsel
Sullivan & Cromwell
Independent Auditors
Deloitte & Touche LLP
General Distributor
Seligman Financial Services, Inc.
100 Park Avenue
New York, NY 10017
Shareholder Service Agent
Seligman Data Corp.
100 Park Avenue
New York, NY 10017
Important Telephone Numbers
(800) 221-2450 Shareholder Services
(800) 455-1777 Retirement Plan
Services
(800) 622-4597 24-Hour Automated
Telephone Access
Service
18
<PAGE>
File No. 2-80168
811-3596
PART C. OTHER INFORMATION
-----------------
Item 24. Financial Statements and Exhibits
- ------- ---------------------------------
(a) Financial Statements and Schedules:
Part A Financial Highlights for Class A shares from commencement of
operations to December 31, 1994; Financial Highlights for Class D
shares from the period May 3, 1993 (commencement of offering) to
December 31, 1994.
Part B Required Financial Statements are included in the Fund's Annual
Report to Shareholders, dated December 31, 1994, which are
incorporated by reference in the Statement of Additional
Information. These include: Portfolio of Investments as of
December 31, 1994; Statement of Assets and Liabilities as of
December 31, 1994; Statement of Operations for the year ended
December 31, 1994; Statements of Changes in Net Assets for the
years ended December 31, 1994 and 1993; Notes to Financial
Statements; Financial Highlights for the five years ended
December 31, 1994 for the Fund's Class A shares and for the
period May 3, 1993 (commencement of offering) through December
31, 1994 for the Fund's Class D shares; Report of Independent
Auditors.
(b) Exhibits: All Exhibits have been previously filed except
Exhibits marked with an asterisk (*) which are incorporated
herein.
(1) Restated Articles of Amendment of Registrant.*
(2) By-laws of the Corporation.
(Incorporated by Reference to Registrant's Registration Statement filed on
November 2, 1982.)
(4) Specimen certificate of Class D Capital Stock.
(Incorporated by Reference to Post-Effective Amendment No. 14 filed on
April 29, 1993.)
(5) Copy of new Management Agreement between Registrant and J. & W. Seligman &
Co. Incorporated.*
(5a) Copy of Subadvisory Agreement between the Manager and Seligman Henderson
Co.*
(6) Copy of the new Distributing Agreement between Registrant and Seligman
Financial Services, Inc. (Incorporated by Reference to Post-Effective
Amendment No. 14 filed on April 29, 1993.)
(6a) Copy of amended Sales Agreement between Seligman Financial Services, Inc.
and Dealers. (Incorporated by Reference to Post-Effective Amendment No. 14
filed on April 29, 1993.)
(7) Amendments to the Amended Retirement Income Plan of J. & W. Seligman & Co.
Incorporated and Trust. (Incorporated by Reference to Post-Effective
Amendment No. 15 filed on April 29, 1994.)
(7a) Amendments to the Amended Employees' Thrift Plan of Union Data Service
Center, Inc. and Trust. (Incorporated by Reference to Post-Effective
Amendment No. 15 filed on April 29, 1994.)
(8) Copy of Amended Custodian Agreement between Registrant and Investors
Fiduciary Trust Company. (Incorporated by Reference to Post-Effective
Amendment No. 12 filed on April 30, 1991.)
(10) Opinion and Consent of Counsel. (Incorporated by Reference to Seligman
Capital Fund, Inc., File No. 2-33566, Post-Effective Amendment No. 47
filed on March 31, 1994.)
(11) Report and Consent of Independent Auditors.*
(13) Purchase Agreement for Initial Capital between Registrant's Class D Shares
and J. & W. Seligman & Co. Incorporated. (Incorporated by Reference to
Post-Effective Amendment No. 14 filed on April 29, 1993.)
(14) Copy of Amended Individual Retirement Account Trust and Related Documents.
(Incorporated by Reference to Post-Effective Amendment No. 13 filed on
April 30, 1992.)
<PAGE>
File No. 2-80168
811-3596
PART C. OTHER INFORMATION (continued)
-----------------
Item 24. Financial Statements and Exhibits (continued)
- ------- ---------------------------------
(14a) Copy of Amended Comprehensive Retirement Plans for Money Purchase and/or
Prototype Profit Sharing Plan. (Incorporated by Reference to Seligman Tax-
Exempt Fund Series, Inc., File No. 2-86008, Post-Effective Amendment No.
24 filed on November 30, 1992.)
(14b) Copy of Amended Basic Business Retirement Plans for Money Purchase and/or
Profit Sharing Plans. (Incorporated by Reference to Seligman Tax-Exempt
Fund Series, Inc., File No. 2-86008, Post-Effective Amendment No. 24 filed
on November 30, 1992.)
(14c) Copy of Amended 403(b)(7) Custodial Account Plan. (Incorporated by
Reference to Seligman New Jersey Tax-Exempt Fund, Inc., File No. 33-13401,
Pre-Effective Amendment No. 1 filed on January 11, 1988.)
(14d) Copy of Amended Simplified Employee Pension Plan (SEP). (Incorporated by
Reference to Seligman Capital Fund, Inc., File No. 2-33566, Post-Effective
Amendment No. 43 filed on April 30, 1992.)
(14e) Copy of the amended J. & W. Seligman & Co. Incorporated (SARSEP) Salary
Reduction and Other Elective Simplified Employee Pension-Individual
Retirement Accounts Contribution Agreement (Under Section 408(k) of the
Internal Revenue Code).
(Incorporated by Reference to Post-Effective Amendment No. 13 filed on
April 30, 1992.)
(15) Copy of amended Administration, Shareholder Services and Distribution Plan
and form of Agreement of Registrant.
(Incorporated by Reference to Post-Effective Amendment No. 14 filed on
April 29, 1993.)
(16 ) Schedule for Computation of each Performance Quotation provided in
Registration Statement to Item 22.
(Incorporated by Reference to Post-Effective Amendment No. 10 filed on
April 30, 1990.)
Item 25. Persons Controlled by or Under Common Control with Registrant - None.
- -------- -------------------------------------------------------------
Item 26. Number of Holders of Securities- As of March 31, 1995, there were
- -------- -------------------------------
44,957 record holders of the Registrant's Class A Capital Stock and
12,927 record holders of Registrant's Class D Capital Stock.
Item 27. Indemnification - Incorporated by reference to Registrant's Post-
- -------- ---------------
Effective Amendment #12 (File No. 2-80168) which was filed with the
Commission on May 1, 1991.
Item 28. Business and Other Connections of Investment Adviser - J. & W.
- -------- ----------------------------------------------------
Seligman & Co. Incorporated, a Delaware corporation ("Manager"), is
the Registrant's investment manager. The Manager also serves as
investment manager to sixteen associated investment companies. They
are Seligman Capital Fund, Inc., Seligman Cash Management Fund, Inc.
Seligman Common Stock Fund, Inc., Seligman Frontier Fund, Inc.,
Seligman Growth Fund, Inc., Seligman Henderson Global Fund Series,
Inc., Seligman High Income Fund Series, Seligman Income Fund, Inc.,
Seligman New Jersey Tax-Exempt Fund, Inc., Seligman Pennsylvania Tax-
Exempt Fund Series, Seligman Portfolios, Inc., Seligman Quality
Municipal Fund, Inc., Seligman Tax-Exempt Fund Series, Inc., Seligman
Tax-Exempt Series Trust, Seligman Select Municipal Fund, Inc. and Tri-
Continental Corporation.
The Subadviser also serves as subadviser to seven other associated
investment companies. They are Seligman Capital Fund, Inc. Seligman
Common Stock Fund, Inc., Seligman Growth Fund, Inc., Seligman
Henderson Global Fund Series, Inc., Seligman Income Fund, Inc., the
Global and Global Smaller Companies Portfolios of Seligman Portfolios,
Inc. and Tri-Continental Corporation.
The Manager and Subadviser have investment advisory service divisions
which provide investment management or advice to private clients. The
list required by this Item 28 of officers and directors of the Manager
and the Subadviser, respectively, together with information as to any
other business, profession, vocation or employment of a substantial
nature engaged in by such officers and directors during the past two
years, is incorporated by reference to Schedules A and D of Form ADV,
filed by the Manager and the Subadviser, respectively, pursuant to the
Investment Advisers Act of 1940 (SEC File No. 801-5798 and SEC File
No. 801-4067 both of which were filed on March 30, 1994).
<PAGE>
File No. 2-80168
811-3596
PART C. OTHER INFORMATION (continued)
-----------------
Item 29. Principal Underwriters
- -------- ----------------------
(a) The names of each investment company (other than the Registrant) for
which each principal underwriter currently distributing securities of
the Registrant also acts as a principal underwriter, depositor or
investment adviser follow:
Seligman Capital Fund, Inc.
Seligman Cash Management Fund, Inc.
Seligman Common Stock Fund, Inc.
Seligman Frontier Fund, Inc.
Seligman Growth Fund, Inc.
Seligman Henderson Global Fund Series, Inc.
Seligman High Income Fund Series
Seligman Income Fund, Inc.
Seligman New Jersey Tax-Exempt Fund, Inc.
Seligman Pennsylvania Tax-Exempt Fund Series
Seligman Portfolios, Inc.
Seligman Tax-Exempt Fund Series, Inc.
Seligman Tax-Exempt Series Trust
(b) Name of each director, officer or partner of each principal
underwriter named in the answer to Item 21:
Seligman Financial Services, Inc.
---------------------------------
As of April 1, 1995
-------------------
<TABLE>
<CAPTION>
(1) (2) . (3)
Name and Principal Positions and Offices Positions and Offices
Business Address with Underwriter with Registrant
---------------- ---------------- ---------------
<S> <C> <C>
WILLIAM C. MORRIS* Director Chairman of the Board and Chief
Executive Officer President and
Director
RONALD T. SCHROEDER* Director President and Director
FRED E. BROWN* Director Director
MICHAEL J. DEL PRIORE* Director None
WILLIAM H. HAZEN* Director None
THOMAS G. MOLES* Director None
DAVID F. STEIN* Director None
DAVID WATTS* Director None
BRIAN T. ZINO* Director Director
STEPHEN J. HODGDON* President None
MARK R. GORDON Senior Vice President, None
Director of Marketing
GERALD I. CETRULO, III Senior Vice President of Sales None
140 West Parkway and Regional Sales Manager
Pompton Plains, NJ 07444
BRAD DAVIS Regional Vice President None
241 110th Avenue SE
Bellevue, WA 98004
JONATHAN G. EVANS Regional Vice President None
222 Fairmont Way
Ft. Lauderdale, FL 33326
SUSAN GUTTERUD Regional Vice President None
820 Humboldt, #6
Denver, CO 80218
BRADLEY F. HANSON Senior Vice President of Sales None
9707 Xylon Court and Regional Sales Manager
Bloomington, MN 55438
BRADLEY W. LARSON Senior Vice President of Sales None
367 Bryan Drive and Regional Sales Manager
Danville, CA 94526
</TABLE>
<PAGE>
File No. 2-80168
811-3596
PART C. OTHER INFORMATION
- ------- -----------------
Seligman Financial Services, Inc.
---------------------------------
As of April 1, 1995
-------------------
<TABLE>
<CAPTION>
(1) (2) . (3)
Name and Principal Positions and Offices Positions and Offices
Business Address with Underwriter with Registrant
---------------- ---------------- ---------------
<S> <C> <C>
RANDY D. LIERMAN Regional Vice President None
2627 R.D. Mize Road
Independence, MO 64057
JUDITH L. LYON Regional Vice President None
163 Haynes Bridge Rd, Ste. 205
Alpharetta, GA 30201
DAVID MEYNCKE Regional Vice President None
4718 Orange Grove Way
Palm Harbor, FL 34684
HERB W. MORGAN Regional Vice President None
11308 Monticook Court
San Diego, CA 92127
MELINDA NAWN Regional Vice President None
5850 Squire Hill Court
Cincinnati, OH 45241
ROBERT H. RUHM Regional Vice President None
167 Derby Street
Melrose, MA 02176
DIANE SNOWDEN Regional Vice President None
11 Thackery Lane
Cherry Hill, NJ 08003
LYNDA M. SOLEIM* Regional Vice President None
14074 Rue St. Raphael Street
Del Mar, CA 92014
BRUCE TUCKEY Regional Vice President None
23477 Haggerty Road
Building No. 7
Novi, MI 48375
D. IAN VALENTINE Senior Vice President of Sales None
307 Braehead Drive and Regional Sales Manager
Fredericksburg, VA 22401
ANDREW VEASEY Regional Vice President None
40 Goshawk Court
Voorhees, NJ 08043
TODD VOLKMAN Regional Vice President None
4650 Cole Avenue, #216
Dallas, TX 75205
KELLI A. DUMSER Regional Vice President None
8618 Hornwood Court
Charlotte, NC 28215
JAMES R. BESHER Regional Vice President None
1400 Margaux Lane
Town & Country, MO 63017
LAWRENCE P. VOGEL* Senior Vice President - Finance Vice President
HELEN SIMON* Vice President None
MARSHA E. JACOBY* Vice President, National Accounts None
Manager
VITO GRAZIANO* Assistant Secretary Assistant Secretary
WILLIAM W. JOHNSON* Vice President, Order Desk None
FRANK P. MARINO* Assistant Vice President, Mutual
Fund Product Manager None
AURELIA LACSAMANA* Treasurer None
FRANK J. NASTA, ESQ.* Secretary Secretary
</TABLE>
<PAGE>
File No. 2-80168
811-3596
PART C. OTHER INFORMATION
- ---------------------------
* The principal business address of each of these directors and/or officers
is 100 Park Avenue, NY, NY 10017.
(c) Not applicable.
Item 30. Location of Accounts and Records
- -------- --------------------------------
Custodian: Investors Fiduciary Trust Company
127 West 10th Street
Kansas City, Missouri 64105 AND
Seligman Communications and Information Fund, Inc.
100 Park Avenue
New York, NY 10017
Item 31. Management Services - Seligman Data Corp. ("SDC") the Registrant's
- -------- -------------------
shareholder service agent, has an agreement with The Shareholder
Service Group ("TSSG") pursuant to which TSSG provides a data
processing system for certain shareholder accounting and recordkeeping
functions performed by SDC, which commenced in July 1990. For the
fiscal years ended December 31, 1994, 1993 and 1992, the approximate
cost of these services were:
<TABLE>
<CAPTION>
1994 1993 1992
---- ---- ----
<S> <C> <C> <C>
Class A Shares $88,546 $34,800 $34,100
Class D Shares $22,890 $ 200 N/A
</TABLE>
Item 32. Undertakings - The Registrant undertakes, (1) to furnish
- -------- ------------
a copy of the Registrant's latest annual report, upon request and
without charge, to every person to whom a prospectus is delivered
and (2) if requested to do so by the holders of at least ten
percent of its outstanding shares, to call a meeting of
shareholders for the purpose of voting upon the removal of a
director or directors and to assist in communications with other
shareholders as required by Section 16(c) of the Investment
Company Act of 1940.
<PAGE>
File No. 2-80168
811-3596
SIGNATURES
----------
Pursuant to the requirements of the Securities Act of 1933, and the
Investment Company Act of 1940, the Registrant certifies that it meets all of
the requirements of this Post-Effective Amendment pursuant to Rule 485(b) under
the Securities Act of 1993 and has duly caused this Post-Effective Amendment No.
16 to its Registration Statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of New York, State of New York, on the
28th day of April, 1995.
SELIGMAN COMMUNICATIONS AND INFORMATION FUND, INC.
By: /s/ William C. Morris
----------------------------------------------
William C. Morris, Chairman*
Pursuant to the requirements of the Securities Act of 1933, this Post-
Effective Amendment No. 16 has been signed below by the following persons in the
capacities indicated on April 28, 1995.
<TABLE>
<CAPTION>
Signature Title
--------- -----
<S> <C>
/s/ William C. Morris Chairman of the Board (Principal
- ------------------------- executive officer) and Director
William C. Morris*
/s/ Ronald T. Schroeder Director and President
- -------------------------
Ronald T. Schroeder*
/s/ Thomas G. Rose Treasurer
- -------------------------
Thomas G. Rose
</TABLE>
Fred E. Brown, Director )
Alice S. Ilchman, Director )
John E. Merow, Director )
Betsy S. Michel, Director )
Douglas R. Nichols, Jr., Director )
James C. Pitney, Director ) /s/ Brian T. Zino
-----------------------------------
James Q. Riordan, Director ) * Brian T. Zino, Attorney-in-fact
Herman J. Schmidt, Director )
Robert L. Shafer, Director )
James N. Whitson, Director )
Brian T. Zino, Director )
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 6
<SERIES>
<NUMBER> 1
<NAME> SELIGMAN COMMUNICATION & INFORMATION FUND CLASS A
<MULTIPLIER> 1000
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1994
<PERIOD-END> DEC-31-1994
<INVESTMENTS-AT-COST> 331823
<INVESTMENTS-AT-VALUE> 391820
<RECEIVABLES> 16905
<ASSETS-OTHER> 5
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 408730
<PAYABLE-FOR-SECURITIES> 399
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 4689
<TOTAL-LIABILITIES> 5088
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 343742
<SHARES-COMMON-STOCK> 5891<F1>
<SHARES-COMMON-PRIOR> 588<F1>
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 74
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> 23
<ACCUM-APPREC-OR-DEPREC> 59997
<NET-ASSETS> 96099<F1>
<DIVIDEND-INCOME> 104<F1>
<INTEREST-INCOME> 22<F1>
<OTHER-INCOME> 0
<EXPENSES-NET> 1036<F1>
<NET-INVESTMENT-INCOME> (910)<F1>
<REALIZED-GAINS-CURRENT> 33340
<APPREC-INCREASE-CURRENT> 37888
<NET-CHANGE-FROM-OPS> 68223
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0<F1>
<DISTRIBUTIONS-OF-GAINS> 7379<F1>
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 5389<F1>
<NUMBER-OF-SHARES-REDEEMED> 533<F1>
<SHARES-REINVESTED> 447<F1>
<NET-CHANGE-IN-ASSETS> 302822
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 75
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 310<F1>
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 1036<F1>
<AVERAGE-NET-ASSETS> 41352<F1>
<PER-SHARE-NAV-BEGIN> 13.32<F1>
<PER-SHARE-NII> (.33)<F1>
<PER-SHARE-GAIN-APPREC> 4.78<F1>
<PER-SHARE-DIVIDEND> 0<F1>
<PER-SHARE-DISTRIBUTIONS> 1.46<F1>
<RETURNS-OF-CAPITAL> 0<F1>
<PER-SHARE-NAV-END> 16.31<F1>
<EXPENSE-RATIO> 2.50<F1>
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
<FN>
<F1>Class D only. All other data are fund level.
</FN>
</TABLE>
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 6
<SERIES>
<NUMBER> 2
<NAME> SELIGMAN COMMUNICATIONS & INFORMATION FUND CLASS D
<MULTIPLIER> 1000
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1994
<PERIOD-END> DEC-31-1994
<INVESTMENTS-AT-COST> 331823
<INVESTMENTS-AT-VALUE> 391820
<RECEIVABLES> 16905
<ASSETS-OTHER> 5
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 408730
<PAYABLE-FOR-SECURITIES> 399
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 4689
<TOTAL-LIABILITIES> 5088
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 343742
<SHARES-COMMON-STOCK> 18486<F1>
<SHARES-COMMON-PRIOR> 6924<F1>
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 74
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> 23
<ACCUM-APPREC-OR-DEPREC> 59997
<NET-ASSETS> 307543<F1>
<DIVIDEND-INCOME> 517<F1>
<INTEREST-INCOME> 111<F1>
<OTHER-INCOME> 0
<EXPENSES-NET> 2723<F1>
<NET-INVESTMENT-INCOME> (2095)<F1>
<REALIZED-GAINS-CURRENT> 33340
<APPREC-INCREASE-CURRENT> 37888
<NET-CHANGE-FROM-OPS> 68223
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0<F1>
<DISTRIBUTIONS-OF-GAINS> 23057<F1>
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 13566<F1>
<NUMBER-OF-SHARES-REDEEMED> 3338<F1>
<SHARES-REINVESTED> 1334<F1>
<NET-CHANGE-IN-ASSETS> 302822
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 75
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 1237<F1>
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 2723<F1>
<AVERAGE-NET-ASSETS> 164954<F1>
<PER-SHARE-NAV-BEGIN> 13.43<F1>
<PER-SHARE-NII> (.19)<F1>
<PER-SHARE-GAIN-APPREC> 4.86<F1>
<PER-SHARE-DIVIDEND> 0<F1>
<PER-SHARE-DISTRIBUTIONS> 1.46<F1>
<RETURNS-OF-CAPITAL> 0<F1>
<PER-SHARE-NAV-END> 16.64<F1>
<EXPENSE-RATIO> 1.65<F1>
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
<FN>
<F1>Class A only. All other data are fund level.
</FN>
</TABLE>
<PAGE>
[The text of this Exhibit is a composite restatement of all charter
documents of the Registrant currently on file with the State Department of
Assessments and Taxation of the State of Maryland.]
ARTICLES OF INCORPORATION
OF
SELIGMAN COMMUNICATIONS AND INFORMATION FUND, INC.
FIRST: I, the subscriber, John T. Bostelman, whose post office
address is 125 Broad Street, New York, New York 10004 being at least twenty-one
years of age, do, under and by virtue of the General Laws of the State of
Maryland authorizing the formation of corporations, form a corporation.
SECOND: NAME. The name of the corporation (which is hereinafter
called the "Corporation") is
SELIGMAN COMMUNICATIONS AND INFORMATION FUND, INC.
THIRD: PURPOSES AND POWERS. The purposes for which the Corporation
is formed and the business or objects to be carried on or promoted by it are to
engage in the business of holding, investing and reinvesting its funds in
securities, and in connection therewith, to hold part or all of its funds in
cash, to acquire by purchase, subscription, contract, exchange or otherwise, and
to own, hold for investment, resale or otherwise, sell assign, negotiate,
exchange, transfer or otherwise dispose of, or turn to account or realize upon,
and generally to deal in and with, all forms of stocks, bonds, debentures,
notes, evidences of interest, evidences of indebtedness, warrants, and other
securities, irrespective of their form, the name by which they may be described,
or the character or form of the entities by which they are issued or created
(hereinafter sometimes called "Securities"); and, subject to the provisions of
these Articles of Incorporation, to make payment therefor by any lawful means;
to exercise any and all rights, powers and privileges of individual ownership or
interest in respect of any and all such Securities, including the right to vote
thereon and to consent and otherwise act with respect thereto; to do any and all
acts and things for the preservation, protection, improvement and enhancement in
value of any and all such Securities; to acquire or become interested in any
such Securities as aforesaid, irrespective of whether or not such Securities be
fully paid or subject to further payments, and to make payments thereon as
called for or in advance of calls or otherwise;
And, in general, to do any or all such other things in connection with
the objects and purposes of the Corporation hereinbefore set forth, as are, in
the opinion of the Board of Directors of the Corporation, necessary, incidental,
relative or conducive to the attainment of such objects and purposes; and to do
such acts and things, and to exercise any and all such powers to the same extent
as a natural person might or could lawfully do to the full extent authorized or
permitted to a corporation under any laws that may be now or hereafter
applicable or available to the Corporation.
-1-
<PAGE>
In addition, the Corporation may issue, sell, acquire through
purchase, exchange, or otherwise, hold, dispose of, resell, transfer, reissue or
cancel shares of its capital stock in any manner and to the extent now or
hereafter permitted by the laws of Maryland and by these Articles of
Incorporation.
The foregoing matters shall be construed as purposes, objects and
powers, and none of such matters shall be in anywise limited by reference to, or
inference from, any other of such matters or any other Article of these Articles
of Incorporation, but shall be regarded as independent purposes, objects and
powers and the enumeration of specific purposes, objects and powers shall not be
construed to limit or restrict in any manner the meaning of general terms or the
general powers of the Corporation now or hereafter conferred by the laws of the
State of Maryland, nor shall the expression of one thing be deemed to exclude
another, although it be of like nature, not expressed.
Nothing herein contained shall be construed as giving the Corporation
any rights, powers or privileges not permitted to it by law.
FOURTH: PRINCIPAL OFFICE. The post office address of the principal
office of the Corporation in this State is c/o The Corporation Trust
Incorporated, 32 South Street, Baltimore, Maryland 21202. The resident agent of
the Corporation is The Corporation Trust Incorporated, the post office address
of which is 32 South Street, Baltimore, Maryland 21202. Said resident agent is
a corporation of the State of Maryland.
FIFTH: CAPITAL STOCK.
A. The total number of shares of capital stock of all classes which
the Corporation has authority to issue is 100,000,0000 shares of capital stock
(par value $.10 per share), amounting to an aggregate par value of $10,000,000.
All of such shares are initially classified as "Common Stock." The Board of
Directors may classify or reclassify any unissued shares of capital stock (which
classes shall share ownership of specifically allocated assets buy may have
differing dividend, distribution, and other rights, as hereinafter contemplated)
whether or not such shares have previously been classified or reclassified from
time to time by setting or changing in any one or more respects the preferences,
conversion or other rights, voting powers, restrictions, limitations as to
dividends, qualifications, or terms or conditions of redemption of such shares
of stock.
B. No holder of shares of the capital stock of the Corporation shall
be entitled as such, as a matter of right, to purchase or subscribe for any part
of any new or additional issue of stock or securities of the Corporation.
C. All shares of the capital stock of the Corporation now or
hereafter authorized shall be "subject to redemption" and "redeemable", in the
sense used in the General Laws of the State of Maryland authorizing the
formation of corporations. In the absence of any contrary specification as to
the purpose for which shares of the capital stock of the Corporation are
redeemed or repurchased by it, all shares of any class so redeemed or
repurchased shall thereafter have the status of authorized but unissued capital
stock of such class of the Corporation.
D. The terms of the Common Stock as set by the Board of Directors are
as follows:
(a) The Common Stock of the Corporation shall have two classes of
shares, which shall be designated Class A and Class D. The number of
authorized shares of Class A Common Stock and Class D Common Stock shall
each consist of the sum of x and y where: x equals the
-2-
<PAGE>
issued and outstanding shares of such class; and y equals one-half of the
authorized but unissued shares of Common Stock of all classes; provided
that at all times the aggregate authorized, issued and outstanding shares
of Class A and Class D Common Stock shall not exceed the authorized number
of shares of Common Stock (i.e., 100,000,000 shares of common stock until
changed by further action of the Board of Directors in accordance with
Section 2-208.1 of the Maryland General Corporation Law); and, in the event
application of the formula above would result, at any time, in fractional
shares, the applicable number of authorized shares of each class shall be
rounded down to the nearest whole number of shares of such class. Any class
of Common Stock shall be referred to herein individually as a "Class" and
collectively, together with any further class or classes from time to time
established, as the "Classes."
(b) All Classes shall represent the same interest in the Corporation
and have identical voting, dividend, liquidation, and other rights;
provided, however, that notwithstanding anything in the charter of the
Corporation to the contrary:
(1) Class A Shares may be subject to such front-end sales loads
as may be established by the Board of Directors from time to time in
accordance with the Investment Company Act of 1940, as amended (the
"Investment Company Act") and applicable rules and regulations of the
National Association of Securities Dealers, Inc. (the "NASD").
(2) Class D shares may be subject to such contingent deferred
sales charges as may be established from time to time by the Board of
Directors in accordance with the Investment Company Act and applicable
rules and regulations of the NASD.
(3) Expenses related solely to a particular Class (including,
without limitation, distribution expenses under a Rule 12b-1 plan and
administrative expenses under an administration or service agreement,
plan or other arrangement, however designated, which may differ
between the Classes) shall be borne by that Class and shall be
appropriately reflected (in the manner determined by the Board of
Directors) in the net asset value, dividends, distribution and
liquidation rights of the shares of that Class.
(4) At such time as shall be permitted under the Investment
Company Act, any applicable rules and regulations thereunder and the
provisions of any exemptive order applicable to the Corporation, and
as may be determined by the Board of Directors and disclosed in the
then current prospectus of the Corporation, shares of a particular
Class may be automatically converted into shares of another Class;
provided, however, that such conversion shall be subject to the
continuing availability of an opinion of counsel to the effect that
such conversion does not constitute a taxable event under federal
income tax law. The Board of Directors, in its sole discretion, may
suspend any conversion rights if such opinion is no longer available.
(5) As to any matter with respect to which a separate vote of any
Class of a Series is required by the Investment Company Act or by the
Maryland General Corporation Law (including, without limitation,
approval of any plan, agreement or other arrangement referred to in
subsection (3) above), such requirement as to a separate vote by that
Class shall apply in lieu of a single Class voting, and, if permitted
by the Investment Company Act or any rules, regulations or orders
thereunder and the Maryland General Corporation Law, the Classes shall
vote together as a single Class on any such matter that shall have the
same effect on each such Class. As to any matter that does not
-3-
<PAGE>
affect the interest of a particular Class, only the holders of shares
of the affected Class shall be entitled to vote.
SIXTH: DIRECTORS. The number of directors of the Corporation shall
initially be ten and the names of the directors who shall act as such until the
first annual meeting or until their successors are elected and qualify are as
follows:
Lane W. Adams Douglas R. Nichols, Jr.
Fred E. Brown Robert G. Olmsted
Stanley R. Currie James C. Pitney
William McBride Love Ronald T. Schroeder
John E. Merow Robert L. Shafer
The number of directors in office may be changed from time to time in such
manner as the By-Laws of the Corporation shall provide.
SEVENTH: PROVISIONS FOR DEFINING, LIMITING AND REGULATING THE POWERS
OF THE CORPORATION, DIRECTORS AND SHAREHOLDERS.
A. BOARD OF DIRECTORS. The Board of Directors shall have the general
management and control of the business and property of the Corporation, and may
exercise all the powers of the Corporation, except such as are by law or by
these Articles of Incorporation or by the By-Laws conferred upon or reserved to
the shareholders. In furtherance and not in limitation of the powers conferred
by law, the Board of Directors is hereby empowered:
1. To authorize the issuance and sale, from time to time, of shares
of the capital stock of the Corporation, whether for cash at not less than
the par value thereof or for such other consideration as the Board of
Directors may deem advisable, in the manner and to the extent now or
hereafter permitted by the laws of Maryland; provided, however, that the
consideration (or the value thereof as determined by the Board of
Directors) per share to be received by the Corporation upon the sale of any
shares of its capital stock (including treasury shares) shall not be less
than the net asset value (determined as provided in Article NINTH hereof)
per share of such capital stock outstanding at the time (determined by the
Board of Directors) as of which the computation of such net asset value
shall be made.
2. To authorize the execution and performance by the Corporation of
an agreement or agreements, which may be exclusive contracts, with J. & W.
Seligman and Co. Marketing, Inc., a Delaware corporation, or any other
person, as distributor, providing for the distribution of shares of the
capital stock of the Corporation.
3. To specify, in instances in which it may be desirable, that shares
of the capital stock of the Corporation repurchased by it are not
repurchased for retirement and to specify the purposes for which such
shares are repurchased.
4. To authorize the execution and performance by the Corporation of
an agreement or agreements with J. & W. Seligman & Co. Incorporated
("Seligman") or any other person whereby, subject to the control of the
Board of Directors, the investment and other operations of the Corporation
shall be managed by Seligman or such other person.
-4-
<PAGE>
The Corporation may in its By-Laws confer powers on the Board of
Directors in addition to the foregoing and in addition to the powers expressly
conferred by statute.
B. VOTING POWERS. The presence in person or by proxy of the holders
of one-third of the shares of the capital stock of the Corporation outstanding
and entitled to vote thereat shall constitute a quorum at any meeting of the
shareholders. If at any meeting of the shareholders there be less than a quorum
present, the shareholders present at such meeting may, without further notice,
adjourn the same from time to time until a quorum shall attend, but no business
shall be transacted at any such adjourned meeting, except such as might have
been lawfully transacted had the meeting not been adjourned. Notwithstanding
any provision of law requiring any action to be taken or authorized by the
holders of a greater proportion than a majority of the shares of capital stock
of the Corporation entitled to vote thereon, such action shall be valid and
effective if taken or authorized by the affirmative vote of the holders of a
majority of the shares of the capital stock of the Corporation outstanding and
entitled to vote thereon.
EIGHTH: REDEMPTIONS AND REPURCHASES.
A. The Corporation shall under some circumstances redeem, and may
under other circumstances repurchase, shares of its capital stock as follows:
1. OBLIGATION OF THE CORPORATION TO REDEEM SHARES: Each holder of
shares of any class shall be entitled at his option to require the
Corporation to redeem all or any part of the shares of capital stock of
that class owned by such holder, upon written or telegraphic request to the
Corporation or its designated agent, accompanied by surrender of the
certificate or certificates for such shares, or such other evidence of
ownership as shall be specified by the Board of Directors, for the
proportionate interest per share in the assets of the Corporation belonging
to that class, or the cash equivalent thereof (being the net asset value of
such share of that class determined as provided in Article NINTH hereof,
less the amount of any applicable contingent deferred sales charge payable
on such redemption), subject to and in accordance with the provisions of
paragraph B of this Article.
2. RIGHT OF THE CORPORATION TO REPURCHASE SHARES: In addition the
Board of Directors may, from time to time in its discretion, authorize the
officers of the Corporation to repurchase shares of its capital stock,
either directly or through an agent, subject to and in accordance with the
provisions of paragraph B of this Article. The price to be paid by the
Corporation upon any such repurchase shall be determined, in the discretion
of the Board of Directors, in accordance with any provision of the
Investment Company Act of 1940 or any rule or regulation or order of the
Securities and Exchange Commission thereunder.
3. REDEMPTION OF ACCOUNTS: In addition the Board of Directors may,
from time to time in its discretion, authorize the Corporation to require
the redemption of all or any part of the outstanding Shares of any Class or
all or any part of the outstanding Shares of any shareholder, for the
proportionate interest per Share in the assets of the Corporation belonging
to that Class or shareholder, or the cash equivalent thereof (being the net
asset value per Share of that Class determined as provided in Article NINTH
hereof), subject to and in accordance with the provisions of paragraph B of
this Article, upon the sending of written notice thereof to each
shareholder any of whose Shares are so redeemed and upon such terms and
conditions as the Board of Directors shall deem advisable.
-5-
<PAGE>
B. The following provisions shall be applicable with respect to
redemptions and repurchases of shares of the capital stock of the Corporation
pursuant to paragraph A hereof:
1. Certificates of shares of capital stock to be redeemed or
repurchased shall be surrendered in proper form for transfer, together with
such proof of the authenticity of signatures as may be required by
resolution of the Board of Directors.
2. Payment of the redemption or repurchase price by the Corporation
or its designated agent shall be made in cash within seven days after the
time used for determination of the redemption or repurchase price, but in
no event prior to delivery to the Corporation, or its designated agent, of
the certificate or certificates for the shares of capital stock so redeemed
or repurchased or of such other evidence of ownership as shall be specified
by the Board of Directors; except that any payment may be made in whole or
in part in securities or other assets of the Corporation, if, in the event
of the closing of the New York Stock Exchange or the happening of any event
at any time prior to actual payment which makes the liquidation of
Securities in orderly fashion impractical or impossible, the Board of
Directors shall determine that payment in cash would be prejudicial to the
best interests of the remaining shareholders of the Corporation. In making
any such payment in whole or in part in Securities or other assets of the
Corporation, the Corporation shall, as nearly as may be practicable,
deliver Securities or other assets of a gross value (determined in the
manner provided in Article NINTH hereof) representing the same
proportionate interest in the Securities and other assets of the
Corporation as is represented by the shares so to be paid for. Delivery of
the Securities included in any such payment shall be made as promptly as
any necessary transfers on the books of the several corporations whose
Securities are to be delivered may be made.
3. The right of the holder of shares of capital stock redeemed or
repurchased by the Corporation, as provided in this Article, to receive
dividends thereon and all other rights of such holder with respect to such
shares shall forthwith cease and terminate from and after the time as of
which the redemption or repurchase price of such shares has been determined
(except the right of such holder to receive (a) the redemption or
repurchase price of such shares from the Corporation or its designated
agent, and cash and/or in Securities or other assets of the Corporation,
and (b) any dividend to which such holder had previously become entitled as
the record holder of such shares on the record date from such dividend and
with respect to shares of capital stock otherwise entitled to vote, except
the right of such holder to vote at a meeting of shareholders such shares
owned of record by him on the record date for such meeting).
NINTH: DETERMINATION OF NET ASSET VALUE. For the purposes referred
to in Articles SEVENTH and EIGHTH hereof the net asset value of shares of the
capital stock of the Corporation shall be determined by or pursuant to the
direction of the Board of Directors in accordance with the following provisions:
A. Such net asset value on any day shall be computed as follows:
The net asset value of each share of such stock shall be the quotient
obtained by dividing the "net value of the assets" of the Corporation by
the total number of shares at the time deemed to be outstanding (including
shares sold whether paid for and issued or not, and excluding shares
redeemed or repurchased on the basis of previous determined values, whether
paid for, received and held in treasury, or not).
-6-
<PAGE>
The "net value of the assets" shall be the "gross value" after
deducting the amount of all expenses incurred and accrued and unpaid, such
reserves as may be set up to cover taxes and any other liabilities, and
such other deductions as in the opinion of the officers of the Corporation
are in accordance with accepted accounting practice.
The "gross value" of the assets shall be the amount of all cash and
receivables and the market value of all Securities and other assets held by
the Corporation at the time as of which the determination is made.
Securities held shall be valued at market value or, in the absence of
readily available market quotations, at fair value, both as determined
pursuant to methods approved by the Board of Directors and in accordance
with applicable statutes and regulations.
B. The Board of Directors is empowered, in its absolute discretion,
to establish other methods for determining such net asset value whenever such
other methods are deemed by it to be necessary or desirable and are consistent
with any provision of the Investment Company Act of 1940 or any rule or
regulation or order of the Securities and Exchange Commission thereunder. The
time or times as of which the net asset value of shares of the capital stock of
the Corporation shall be computed shall be such time or times as may be
determined by or pursuant to the direction of the Board of Directors.
TENTH: DETERMINATION BINDING. Any determination made by or pursuant
to the direction of the Board of Directors in good faith and in accordance with
accepted accounting practice, as to the amount of the assets, obligations or
liabilities of the Corporation, as to the amount of the net income of the
Corporation for any period or amounts at any time legally available for the
payment of dividends, as to the amount of any reserves or charges set up and the
propriety thereof, as to the time of or purpose for creating any reserves or
charges, as to the use, alteration or cancellation of any reserves or charges
(whether or not any obligation or liability for which such reserves or charges
shall have been created shall have been paid or discharged or shall be then or
thereafter required to be paid or discharged), as to the price or closing bid or
asked price of any Security owned or held by the Corporation, as to the market
value of any Security or fair value of any other asset owned by the Corporation,
as to the number of shares of the Corporation issued or issuable, as to the
impracticability or impossibility of liquidating Securities in orderly fashion,
as to the extent to which it is practicable to deliver the proportionate
interest in the Securities and other assets of the Corporation represented by
any shares redeemed or repurchased in payment for any such shares, as to the
method of payment for any such shares, redeemed or repurchased, or as to any
other matters relating to the issue, sale, redemption, repurchase, and/or other
acquisition or disposition of Securities or shares of capital stock of the
Corporation shall be final and conclusive and shall be binding upon the
Corporation and all holders of shares of its capital stock, past, present and
future, and shares of the capital stock of the Corporation are issued and sold
on the condition and understanding that any and all such determinations shall be
binding as aforesaid. No provision of these Articles of Incorporation shall be
effective to (a) bind any person waive compliance with any provision of the
Securities Act of 1933 or the Investment Company Act of 1940 or of any valid
rule, regulation or order of the Securities and Exchange Commission thereunder,
or (b) protect or purport to protect any director or officer of the Corporation
against any liability to the Corporation or its security holders to which he
would otherwise be subject by reason of willful misfeasance, bad faith, gross
negligence or reckless disregard of the duties involved in the conduct of his
office.
ELEVENTH: AMENDMENTS. The Corporation reserves the right to take any
lawful action and to make any amendment of these Articles of Incorporation,
including the right to make any amendment which changes the terms of any shares
of the capital stock of the Corporation of any class now or hereafter authorized
by classification, reclassification, or otherwise, and to make any amendment
authorizing any sale, lease, exchange or transfer of the property and assets of
the Corporation as an
-7-
<PAGE>
entirety, or substantially as an entirety, with or without its good will and
franchise, if a majority of all the shares of the capital stock of the
Corporation at the time issued and outstanding and entitled to vote, vote in
favor of any such action or amendment, or consent thereto in writing, and
reserves the right to make any amendment of these Articles of Incorporation in
any form, manner or substance now or hereafter authorized or permitted by law.
TWELFTH: LIABILITY. A director or officer of the Corporation shall
not be liable to the Corporation or its shareholders for monetary damages for
breach of fiduciary duty as a Director or Officer, except to the extent such
exemption from liability or limitation thereof is not permitted by law
(including the Investment Company Act of 1940 as currently in effect or as the
same may hereafter be amended).
No amendment, modification or repeal of this Article Twelfth shall
adversely affect any right or protection of a Director or Officer that exists at
the time of such amendment, modification or repeal.
THIRTEENTH: INDEMNIFICATION OF DIRECTORS, OFFICERS AND EMPLOYEES.
The Corporation shall indemnify to the fullest extent permitted by law
(including the Investment Company Act of 1940 as currently in effect or as the
same may hereafter be amended) any person made or threatened to be made a party
to any action, suit or proceeding, whether criminal, civil, administrative or
investigative, by reason of the fact that such person or such person's testator
or intestate is or was a Director, Officer or employee of the Corporation or
serves or served at the request of the Corporation any other enterprise as a
Director, Officer or employee. To the fullest extent permitted by law
(including the Investment Company Act of 1940 as currently in effect or as the
same may hereafter be amended), expenses incurred by any such person in
defending any such action, suit or proceeding shall be paid or reimbursed by the
Corporation promptly upon receipt by it of an undertaking of such person to
repay such expenses if it shall ultimately be determined that such person is not
entitled to be indemnified by the Corporation. The rights provided to any
person by this Article shall be enforceable against the Corporation by such
person who shall be presumed to have relied upon it in serving or continuing to
serve as a Director, Officer or employee as provided above. No amendment of
this Article THIRTEENTH shall impair the rights of any person arising at any
time with respect to events occurring prior to such amendment. For purposes of
this Article THIRTEENTH, the term "Corporation" shall include any predecessor of
the Corporation and any constituent corporation (including any constituent of a
constituent) absorbed by the Corporation in a consolidation or merger; the term
"other enterprise" shall include any corporation, partnership, joint venture,
trust or employee benefit plan; service "at the request of the Corporation"
shall include service as a Director, Officer or employee of the Corporation
which imposes duties on, or involves services by, such Director, Officer or
employee with respect to an employee benefit plan, its participants or
beneficiaries; any excise taxes assessed on a person with respect to an employee
benefit plan shall be deemed to be indemnifiable expenses; and action by a
person with respect to any employee benefit plan which such person reasonably
believes to be in the interest of the participants and beneficiaries of such
plan shall be deemed to be action not opposed to the best interests of the
Corporation.
I acknowledge this document to be my act, and state under the
penalties of perjury that with respect to all matters and facts therein, to the
best of my knowledge, information and belief such matters and facts are true in
all material respects.
October 6, 1982 /s/ John T. Bostelman
---------------------------
John T. Bostelman
-8-
<PAGE>
MANAGEMENT AGREEMENT
MANAGEMENT AGREEMENT, dated as of December 29, 1988, between SELIGMAN
COMMUNICATIONS AND INFORMATION FUND, INC., a Maryland corporation (the
"Corporation"), and J. & W. SELIGMAN & CO. INCORPORATED, a Delaware corporation
(the "Manager").
In consideration of the mutual agreements herein made, the parties
hereto agree as follows:
1. DUTIES OF THE MANAGER. The Manager shall manage the affairs of
the Corporation including, but not limited to, continuously providing the
Corporation with investment management, including investment research, advice
and supervision, determining which securities shall be purchased or sold by the
Corporation, making purchases and sales of securities on behalf of the
Corporation and determining how voting and other rights with respect to
securities of the Corporation shall be exercised, subject in each case to the
control of the Board of Directors of the Corporation and in accordance with the
objectives, policies and principles set forth in the Registration Statement and
Prospectus of the Corporation and the requirements of the Investment Company Act
of 1940 (the "Act") and other applicable law. In performing such duties, the
Manager shall provide such office space, such bookkeeping, accounting, internal
legal, clerical, secretarial and administrative services (exclusive of, and in
addition to, any such services provided by any others retained by the
Corporation) and such executive and other personnel as shall be necessary for
the operations of the Corporation. The Corporation understands that the Manager
also acts as the manager of the investment companies in the Seligman Group.
Subject to Section 36 of the Act, the Manager shall not be liable to
the Corporation for any error of judgment or mistake of law or for any loss
arising out of any investment or for any act or omission in the management of
the Corporation and the performance of its duties under this Agreement except
for willful misfeasance, bad faith or gross negligence in the performance of its
duties or by reason of reckless disregard of its obligations and duties under
this Agreement.
2. EXPENSES. The Manager shall pay all of its expenses arising from
the performance of its obligations under Section 1 and shall pay any salaries,
fees and expenses of the directors of the Corporation who are employees of the
Manager or its affiliates. The Manager shall not be required to pay any other
expenses of the Corporation, including, but not limited to, direct charges
relating to the purchase and sale of portfolio securities, interest charges,
fees and expenses of independent attorneys and auditors, taxes and governmental
fees, cost of stock certificates and any other expenses (including clerical
expenses) of issue, sale, repurchase or redemption of shares, expenses of
registering and qualifying shares for sale, expenses of printing and
distributing reports, notices and proxy materials to shareholders, expense of
corporate data processing and related services, shareholder recordkeeping and
shareholder
<PAGE>
account services, expenses of printing and filing reports and other documents
filed with governmental agencies, expenses of printing and distributing
prospectuses, expenses of annual and special shareholders' meetings, fees and
disbursements of transfer agents and custodians, expenses of disbursing
dividends and distributions, fees and expenses of directors of the Corporation
who are not employees of the Manager or its affiliates, membership dues in the
Investment Company Institute, insurance premiums and extraordinary expenses such
as litigation expenses.
3. COMPENSATION. (a) As compensation for the services performed and
the facilities and personnel provided by the Manager pursuant to Section 1, the
Corporation will pay to the Manager promptly after the end of each month a fee,
calculated on each day during such month, equal to an annual rate of 0.75% of
the net assets of the Corporation at the close of business on the previous day.
(b) If the Manager shall serve hereunder for less than the whole of
any month, the fee hereunder shall be prorated.
4. PURCHASE AND SALE OF SECURITIES. The Manager shall purchase
securities from or through and sell securities to or through such persons,
brokers or dealers (including the Manager or an affiliate of the Manager) as the
Manager shall deem appropriate in order to carry out the policy with respect to
brokerage as set forth in the Registration Statement and Prospectus of the
Corporation or as the Board of Directors of the Corporation may direct from time
to time. In providing the Corporation with investment management and
supervision, it is recognized that the Manager will seek the most favorable
price and execution, and, consistent with such policy, may give consideration to
the research, statistical and other services furnished by brokers or dealers to
the Manager for its use, to the general attitude of brokers or dealers toward
investment companies and their support of them, and to such other considerations
as the Board of Directors of the Corporation may direct or authorize from time
to time.
Notwithstanding the above, it is understood that it is desirable for
the Corporation that the Manager have access to supplemental investment and
market research and security and economic analysis provided by brokers who
execute brokerage transactions at a higher cost to the Corporation than may
result when allocating brokerage to other brokers on the basis of seeking the
most favorable price and execution. Therefore, the Manager is authorized to
place orders for the purchase and sale of securities for the Corporation with
such brokers, subject to review by the Corporation's Board of Directors from
time to time with respect to the extent and continuation of this practice. It
is understood that the services provided by such brokers may be useful to the
Manager in connection with its services to other clients as well as the
Corporation.
The placing of purchase and sale orders may be carried out by the
Manager or any wholly-owned subsidiary of the Manager.
<PAGE>
If, in connection with purchases and sales of securities for the
Corporation, the Manager or any subsidiary of the Manager may, without material
risk, arrange to receive a soliciting dealer's fee or other underwriter's or
dealer's discount or commission, the Manager shall, unless otherwise directed by
the Board of Directors of the Corporation, obtain such fee, discount or
commission and the amount thereof shall be applied to reduce the compensation to
be received by the Manager pursuant to Section 3 hereof.
Nothing herein shall prohibit the Board of Directors of the
Corporation from approving the payment by the Corporation of additional
compensation to others for consulting services, supplemental research and
security and economic analysis.
5. TERM OF AGREEMENT. This Agreement shall continue in full force
and effect until December 29, 1989 and from year to year thereafter if such
continuance is approved in the manner required by the Act and the Manager shall
not have notified the Corporation in writing at least 60 days prior to such
December 29 or prior to December 29 of any year thereafter that it does not
desire such continuance. This Agreement may be terminated at any time, without
payment of penalty by the Corporation, on 60 days' written notice to the Manager
by vote of the Board of Directors of the Corporation or by vote of a majority of
the outstanding voting securities of the Corporation (as defined by the Act).
This Agreement shall automatically terminate in the event of its assignment (as
defined by the Act).
6. RIGHT OF MANAGER IN CORPORATE NAME. The Manager and the
Corporation each agree that the word "Seligman", which comprises a component of
the Corporation's name, is a property right of the Manager. The Corporation
agrees and consents that (i) it will only use the word "Seligman" as a component
of its corporate name and for no other purpose, (ii) it will not purport to
grant to any third party the right to use the word "Seligman" for any purpose,
(iii) the Manager or any corporate affiliate of the Manager may use or grant to
others the right to use the word "Seligman", or any combination or abbreviation
thereof, as all or a portion of a corporate or business name or for any
commercial purpose, including a grant of such right to any other investment
company, and at the request of the Manager, the Corporation will take such
action as may be required to provide its consent to the use of the word
"Seligman", or any combination or abbreviation thereof, by the Manager or any
corporate affiliate of the Manager, or by any person to whom the Manager or an
affiliate of the Manager shall have granted the right to such use; and (iv) upon
the termination of any management agreement into which the Manager and the
Corporation may enter, the Corporation shall, upon request by the Manager,
promptly take such action, at its own expense, as may be necessary to change its
corporate name to one not containing the word "Seligman" and following such
change, shall not use the word "Seligman", or any combination thereof, as a part
of its corporate name or for any other commercial purpose, and shall use its
best efforts to cause its officers, directors and stockholders to take any and
all actions which the Manager may request to effect the foregoing and to
reconvey to the Manager any and all rights to such word.
<PAGE>
7. MISCELLANEOUS. This Agreement shall be governed by and construed
in accordance with the laws of the State of New York. Anything herein to the
contrary notwithstanding, this Agreement shall not be construed to require, or
to impose any duty upon either of the parties, to do anything in violation of
any applicable laws or regulations.
<PAGE>
IN WITNESS WHEREOF, the Corporation and the Manager have caused this
Agreement to be executed by their duly authorized officers as of the date first
above written.
SELIGMAN COMMUNICATIONS AND
INFORMATION FUND, INC.
By ____________________________________
Ronald T. Schroeder
J. & W. SELIGMAN & CO. INCORPORATED
By ____________________________________
Brian T. Zino
<PAGE>
SUBADVISORY AGREEMENT
SELIGMAN COMMUNICATIONS AND INFORMATION FUND, INC.
SUBADVISORY AGREEMENT, dated as of May 19, 1994 between J. & W. SELIGMAN & CO.
INCORPORATED, a Delaware corporation (the "Manager") and SELIGMAN HENDERSON CO.,
a New York general partnership (the "Subadviser").
WHEREAS, the Manager has entered into a Management Agreement dated December 29,
1988 (the "Management Agreement") with Seligman Communications and Information
Fund, Inc. (the "Fund"), an open-end diversified management investment company
registered under the Investment Company Act of 1940, as amended (the "1940
Act"), pursuant to which the Manager will render investment management services
to the Fund, and to administer the business and other affairs of the Fund; and
WHEREAS, the Manager desires to retain the Subadviser to provide investment
management services to the Fund, and the Subadviser is willing to render such
investment management services.
NOW, THEREFORE, in consideration of the mutual covenants contained herein, the
parties hereto agree as follows:
1. DUTIES OF THE SUBADVISER. The Subadviser will provide the Fund with
investment management services with respect to assets of the Fund if, and to the
extent, designated by the Manager (such designated assets, "Qualifying Assets").
Such services shall include investment research, advice and supervision,
determining which securities shall be purchased or sold by the Fund, making
purchases and sales of securities on behalf of the Fund and determining how
voting and other rights with respect to securities of the Fund shall be
exercised, subject in each case to the control of the Board of Directors of the
Fund and in accordance with the objectives, policies and principles set forth in
the Registration Statement and Prospectus(es) of the Fund and the requirements
of the 1940 Act and other applicable law.
Subject to Section 36 of the 1940 Act, the Subadviser shall not be liable to the
Fund for any error of judgment or mistake of law or for any loss arising out of
any investment or for any act or omission in the management of the Fund and the
performance of its duties under this Agreement except for willful misfeasance,
bad faith or gross negligence in the performance of its duties or by reason of
reckless disregard of its obligations and duties under this Agreement.
2. EXPENSES. The Subadviser shall pay all of its expenses arising from the
performance of its obligations under Section 1.
3. COMPENSATION
(a) As compensation for the services performed and the facilities and
personnel provided by the Subadviser pursuant to Section 1, the Manager
will pay to the Subadviser each month a fee, equal to .75% per annum of
the average monthly Net Qualifying Assets of the Fund.
<PAGE>
(b) As used herein, the term "Net Qualifying Assets" means the Qualifying
Assets less related liabilities as designated by the Manager.
(c) Average monthly Net Qualifying Assets shall be determined, for any
month, by taking the average of the value of the Net Qualifying Assets
as of the (i) opening of business on the first day of such month and
(ii) close of business on the last day of such month.
(d) If the Subadviser shall serve hereunder for less than the whole of any
month, the fee hereunder shall be prorated.
4. PURCHASE AND SALE OF SECURITIES. The Subadviser shall purchase securities
from or through and sell securities to or through such persons, brokers or
dealers as the Subadviser shall deem appropriate in order to carry out the
policy with respect to allocation of portfolio transactions as set forth in the
Registration Statement and Prospectus(es) of the Fund or as the Board of
Directors of the Fund may direct from time to time. In providing the Fund with
investment management and supervision, it is recognized that the Subadviser will
seek the most favorable price and execution, and, consistent with such policy,
may give consideration to the research, statistical and other services furnished
by brokers or dealers to the Subadviser for its use, to the general attitude of
brokers or dealers toward investment companies and their support of them, and to
such other considerations as the Board of Directors of the Fund may direct or
authorize from time to time.
Notwithstanding the above, it is understood that it is desirable for the Fund
that the Subadviser have access to supplemental investment and market research
and security and economic analysis provided by brokers who execute brokerage
transactions at a higher cost to the Fund than may result when allocating
brokerage to other brokers on the basis of seeking the most favorable price and
execution. Therefore, the Subadviser is authorized to place orders for the
purchase and sale of securities of the Fund with such brokers, subject to review
by the Fund's Board of Directors from time to time with respect to the extent
and continuation of this practice. It is understood that the services provided
by such brokers may be useful to the Subadviser in connection with its services
to other clients as well as the Fund.
If, in connection with purchases and sales of securities for the Fund, the
Subadviser may, without material risk, arrange to receive a soliciting dealer's
fee or other underwriter's or dealer's discount or commission, the Subadviser
shall, unless otherwise directed by the Board of Directors of the Fund, obtain
such fee, discount or commission and the amount thereof shall be applied to
reduce the compensation to be received by the Subadviser pursuant to Section 3
hereof.
Nothing herein shall prohibit the Board of Directors of the Fund from approving
the payment by the Fund of additional compensation to others for consulting
services, supplemental research and security and economic analysis.
5. TERM OF AGREEMENT. This Agreement shall continue in full force and effect
until December 31, 1995, and from year to year thereafter if such continuance is
approved in the manner required by the 1940 Act, and if the Subadviser shall
not have notified the Manager in writing at least 60 days prior to such date or
prior to December 31 of any year thereafter that it does
<PAGE>
not desire such continuance. This Agreement may be terminated at any time,
without payment of penalty by the Fund, on 60 days' written notice to the
Subadviser by vote of the Board of Directors of the Fund or by vote of a
majority of the outstanding voting securities of the Fund (as defined by the
1940 Act). This Agreement will automatically terminate in the event of its
assignment (as defined by the 1940 Act) or upon the termination of the
Management Agreement.
6. AMENDMENTS. This Agreement may be amended by consent of the parties hereto
provided that the consent of the Fund is obtained in accordance with the
requirements of the 1940 Act.
7. MISCELLANEOUS. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York. Anything herein to the
contrary notwithstanding, this Agreement shall not be construed to require, or
to impose any duty upon either of the parties, to do anything in violation of
any applicable laws or regulations.
IN WITNESS WHEREOF, the Manager and the Subadviser have caused this
Agreement to be executed by their duly authorized officers as of the date first
above written.
J. & W. SELIGMAN & CO. INCORPORATED
BY____________________________________________
Brian T. Zino
SELIGMAN HENDERSON CO.
BY____________________________________________
David Stein
<PAGE>
Consent of Independent Auditors
Seligman Communication and Information Fund:
We consent to the incorporation by reference in the Statement of Additional
Information in this Post-Effective Amendment No. 16 to Registration Statement
No. 2-80168 of our report dated February 3, 1995, appearing in the Annual Report
to shareholders for the year ended December 31, 1994, and to the reference to us
under the caption "Financial Highlights" in the Prospectus, which is a part of
such Registration Statement.
DELOITTE & TOUCHE LLP
New York, New York
April 28, 1995
