<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [_]
Check the appropriate box:
[_] Preliminary Proxy Statement [_] CONFIDENTIAL, FOR USE OF THE
COMMISSION ONLY (AS PERMITTED BY
RULE 14A-6(E)(2))
[X] Definitive Proxy Statement
[_] Definitive Additional Materials
[_] Soliciting Material Pursuant to Section 240.14a-11(c) or Section 240.14a-12
Duff & Phelps Utilities Income Inc.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), 14a-6(i)(2)
or Item 22(a)(2) of Schedule 14A.
[_] $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
[_] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
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(2) Aggregate number of securities to which transaction applies:
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(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which
the filing fee is calculated and state how it was determined):
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(4) Proposed maximum aggregate value of transaction:
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(5) Total fee paid:
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[_] Fee paid previously with preliminary materials.
[_] Check box if any part of the fee is offset as provided by Exchange
Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee
was paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
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(2) Form, Schedule or Registration Statement No.:
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(3) Filing Party:
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(4) Date Filed:
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Notes:
<PAGE>
LOGO DUFF & PHELPS
UTILITIES INCOME INC.
55 EAST MONROE STREET, CHICAGO, ILLINOIS 60603 (312) 368-5510
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
APRIL 18, 1996
The annual meeting of shareholders of Duff & Phelps Utilities Income Inc.
will be held at the Pendennis Club, Louisville, Kentucky 40202, on Thursday,
April 18, 1996 at 9:00 a.m. to:
1. Elect three directors by the holders of the Fund's common stock;
2. Ratify or reject the selection of Arthur Andersen LLP as independent
public accountants for the Fund; and
3. Transact such other business as may properly come before the meeting.
Shareholders of record at the close of business on February 29, 1996 are
entitled to vote at the meeting.
For the Board of Directors,
/s/ T. Brooks Beittel
T. Brooks Beittel
Secretary
March 11, 1996
WE NEED YOUR PROXY VOTE IMMEDIATELY.
YOUR VOTE IS VITAL. THE MEETING OF SHAREHOLDERS WILL HAVE TO BE ADJOURNED
WITHOUT CONDUCTING ANY BUSINESS IF FEWER THAN A MAJORITY OF THE SHARES ELIGIBLE
TO VOTE ARE REPRESENTED. IN THAT EVENT, THE FUND WOULD CONTINUE TO SOLICIT
VOTES IN AN ATTEMPT TO OBTAIN A QUORUM. TO AVOID THE EXPENSE OF AND THE
POSSIBLE DELAY CREATED BY SUCH A SOLICITATION, PLEASE RETURN YOUR PROXY CARD
IMMEDIATELY. YOU AND ALL OTHER SHAREHOLDERS WILL BENEFIT FROM YOUR COOPERATION.
<PAGE>
PROXY STATEMENT
The board of directors of Duff & Phelps Utilities Income Inc. (the "Fund") is
soliciting proxies from the shareholders for use at the annual meeting of
shareholders to be held April 18, 1996 and at any adjournment of that meeting.
A proxy may be revoked at any time before it is voted, either by voting in
person at the meeting or by written notice to the Fund or delivery of a later-
dated proxy.
Shareholders of the Fund of record at the close of business on February 29,
1996 are entitled to notice of and to participate in the meeting. The Fund had
197,041,864 shares of common stock and 5,000 shares of remarketed preferred
stock outstanding on the record date. Each share of common stock outstanding on
the record date entitles the holder thereof to one vote for each director being
elected by the common stock (with no cumulative voting permitted) and to one
vote on each other matter. Each share of preferred stock outstanding on the
record date entitles the holder thereof to one vote on each matter submitted
for a vote of holders of preferred stock. A plurality of votes cast at the
meeting by the common stock as to the directors representing the common stock
is necessary to elect directors. On most other matters, the affirmative vote of
a majority of either (a) all of the shares outstanding and entitled to be voted
thereon or (b) just the shares voted at the meeting, with the common stock and
the preferred stock voting together as a single class, is necessary for
approval. An affirmative vote by either a majority or two-thirds of the
remarketed preferred stock (voting separately as one class) or by a series
thereof is also necessary to approve certain matters adversely affecting the
remarketed preferred stock or the series. Abstentions are counted for purposes
of determining whether a quorum is present at the meeting but not for purposes
of determining the number of votes cast with respect to any voting matter.
However, abstentions have the effect of a no vote if the vote required is a
majority of all the shares outstanding and entitled to be voted. Any broker
non-votes on a particular matter are treated as abstentions with respect to
that matter.
This proxy statement is first being mailed on or about March 11, 1996. The
Fund will bear the cost of the annual meeting and this proxy solicitation.
1. ELECTION OF DIRECTORS
The board of directors of the Fund is responsible for the overall management
and operations of the Fund. Directors are divided into three classes and
elected to serve staggered three-year terms. At the meeting, holders of common
stock are entitled to elect three directors, in each case to serve until the
annual meeting of shareholders in 1999 or until their successors are elected
and qualified. The holders of the preferred stock are not entitled to elect any
directors at the meeting. The persons named in the enclosed proxy intend to
vote in favor of the election of the persons named below (unless otherwise
instructed).
Each of the nominees has consented to serve as a director of the Fund, if
elected. In case any of the nominees should become unavailable for election for
any unforeseen reason, the persons designated in the proxy will have the right
to vote for a substitute. The name, positions with the Fund, principal
occupations during the past five years, other business affiliations, age at
February 1, 1996 and address of each of the nominees and of each of the other
current directors are stated below. Messrs. Cole, Davidson, Bruce and Day have
been directors of the Fund since January 1989. Ms. Lampton has been a director
of the Fund since October 1994, and Mr. Sprinkel has been a director of the
Fund since April 1995. Each of the other current directors has been a director
of the Fund since the Fund commenced operations in January 1987.
<PAGE>
NOMINEES
FOR TERMS EXPIRING IN 1999:
WALLACE B. BEHNKE, director (3)
Consulting engineer since July 1989; prior thereto, Vice Chairman,
Commonwealth Edison Company (public utility); age 70; 323 Glen
Eagle, Kiawah Island, South Carolina 29455.
GORDON B. DAVIDSON, director (4)
Senior Counsel, Wyatt, Tarrant & Combs (law firm) since September
1995 (Chairman of the Executive Committee prior thereto); Chairman
of the Board and Director, Trans Financial Advisers, Inc. (family of
mutual funds) since September 1995; age 69; Citizens Plaza,
Louisville, Kentucky 40202.
CLAIRE V. HANSEN, director and Chairman (1)(2)(4)
Senior Advisor to the Board of Directors, Phoenix Duff & Phelps
Corporation since November 1995; Senior Advisor to the Board of
Directors, Duff & Phelps Corporation, 1988-November 1995 (Chairman
of the Board, 1987-1988; Chairman of the Board and Chief Executive
Officer prior thereto); Chairman of the Board, Duff Research Inc.
and Duff & Phelps Investment Management Co., 1985-1987; age 70;
Three First National Plaza, Suite 1400, Chicago, Illinois 60602.
CONTINUING DIRECTORS
WITH TERMS EXPIRING IN 1997:
HARRY J. BRUCE, director (3)
Private investor; Chairman, Roman Holdings, Inc.; former Chairman
and Chief Executive Officer, Illinois Central Railroad Co.;
director, General Binding Corporation; age 64; 88 Woodley Road,
Winnetka, Illinois 60093.
ROBERT J. DAY, director (4)(5)
Retired Chairman and Director, USG Corporation (manufacturer of
construction materials) since June 1990 (Chairman and Chief
Executive Officer prior thereto); former Chairman of the Board,
Federal Reserve Bank of Chicago; age 71; 125 South Franklin Street,
Chicago, Illinois 60606.
NANCY LAMPTON, director (5)(6)
Chairman and Chief Executive Officer, American Life and Accident
Insurance Company of Kentucky; director, BancOne Kentucky
Corporation and Baltimore Gas and Electric; age 53; 3 Riverfront
Plaza, Louisville, Kentucky 40202.
2
<PAGE>
WITH TERMS EXPIRING IN 1998:
FRANKLIN A. COLE, director (2)(5)
Chairman, Croesus Corporation (private management and investment
company); former Chairman and Chief Executive Officer, Amerifin
Corporation (formerly named Walter E. Heller International
Corporation); director, American National Bank and Trust Company of
Chicago, American National Corporation, Aon Corporation, CNA Income
Shares, GATX Corporation and People's Energy Corporation; age 69; 11
South LaSalle Street, Chicago, Illinois 60602.
FRANCIS E. JEFFRIES, director (1)(2)(4)
Chairman, Phoenix Duff & Phelps Corporation since November 1995;
Chairman and Chief Executive Officer, Duff & Phelps Corporation,
June 1993-November 1995 (President and Chief Executive Officer,
January 1992-June 1993); President and Chief Executive Officer, Duff
& Phelps Illinois Inc. since 1987 (President and Chief Operating
Officer, 1984-1987) and Chairman of the Board, Duff & Phelps
Investment Management Co. (1988-1993); director, Phoenix Duff &
Phelps Corporation, The Empire District Electric Company, Duff &
Phelps Utilities Tax-Free Income Inc. and Duff & Phelps Utility and
Corporate Bond Trust Inc.; director/trustee, Phoenix Funds; age 65;
55 East Monroe Street, Chicago, Illinois 60603.
BERYL W. SPRINKEL, director (3)(6)
Consulting economist since January 1989; Chairman of the Council of
Economic Advisers under President Reagan (1985-1989); member of
President Reagan's cabinet (1987-1989); Under Secretary of the
Treasury for Monetary Affairs (1981-1985); director, US Life Corp.;
age 72; 20140 St. Andrews Drive, Olympia Fields, Illinois 60461.
- --------
(1) "Interested person" of the Fund (as defined in the Investment Company Act
of 1940 (the "1940 Act")) as an officer of the Fund or as an officer or
director of the Fund's investment adviser.
(2) Member of the executive committee of the board of directors, which has
authority, with certain exceptions, to exercise the powers of the board
between board meetings.
(3) Member of the audit committee of the board of directors, which makes
recommendations regarding the selection of the Fund's independent public
accountants and meets with representatives of the accountants to determine
the scope of and review the results of each audit.
(4) Member of the nominating committee of the board of directors, which selects
nominees for election as directors. The nominating committee does not
consider nominees recommended by shareholders.
(5) Member of the contracts committee of the board of directors, which makes
recommendations regarding the Fund's contractual arrangements for
investment management and administrative services, including the terms and
conditions of such contracts.
(6) Elected by the holders of the Fund's preferred stock.
----------------
During 1995, the board of directors held seven meetings, the audit committee
met twice, the executive committee met once, the nominating committee met three
times and the contracts committee met twice. Each director attended at least
75% in the aggregate of the meetings of the board and of the committees on
which he or she served.
3
<PAGE>
The following table shows the compensation paid by the Fund to the Fund's
current directors (and to Mr. Sidney Davidson, who retired as a director in
1995) during 1995:
COMPENSATION TABLE(1)
<TABLE>
<CAPTION>
AGGREGATE
COMPENSATION
FROM THE
NAME OF DIRECTOR FUND
---------------- ------------
<S> <C>
Wallace B. Behnke............................................ $25,500
Harry J. Bruce............................................... 23,000
Franklin A. Cole............................................. 26,500
Gordon B. Davidson........................................... 24,000
Sidney Davidson(2)........................................... 9,479
Robert J. Day................................................ 25,500
Claire V. Hansen............................................. 0
Francis E. Jeffries.......................................... 0
Nancy Lampton................................................ 22,000
Beryl W. Sprinkel(3)......................................... 14,250
</TABLE>
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(1) During 1995, each director not affiliated with the Adviser received an
annual fee of $15,000 (and an additional $2,500 if the director served as
chairman of a committee of the board of directors) plus an attendance fee
of $1,000 for each meeting of the board of directors or of a committee of
the board of directors attended in person or by telephone. Directors and
officers affiliated with the Adviser receive no compensation from the Fund
for their services as such. In addition to the amounts shown in the table
above, all directors and officers who are not interested persons of the
Fund, the Adviser or the Administrator are reimbursed for the expenses
incurred by them in connection with their attendance at a meeting of the
board of directors or a committee of the board of directors. The Fund does
not have a pension or retirement plan applicable to directors or officers
of the Fund.
(2) Having reached mandatory retirement age for directors of the Fund, Mr.
Sidney Davidson retired effective with the election of his successor at the
annual meeting of shareholders held April 19, 1995. His annual compensation
was pro-rated for the period from January 1, 1995 through April 19, 1995.
(3) Mr. Sprinkel was elected as a director of the Fund at the annual meeting of
shareholders held April 19, 1995, and his annual compensation was pro-rated
for the period from April 19, 1995 through December 31, 1995.
2. SELECTION OF INDEPENDENT PUBLIC ACCOUNTANTS
The board of directors has selected Arthur Andersen LLP as independent public
accountants for the Fund until the annual meeting of shareholders held in 1997.
Arthur Andersen LLP has served as independent public accountants for the Fund
since the Fund commenced operations. The selection is being submitted for
ratification or rejection by the shareholders as required by the 1940 Act. A
representative of Arthur Andersen LLP is expected to be present at the meeting
of shareholders and will be available to respond to appropriate questions and
have an opportunity to make a statement if the representative so desires.
Ratification or rejection of the selection of independent public accountants
will be determined by a majority of the votes cast.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" RATIFICATION OF THE SELECTION
OF ARTHUR ANDERSEN LLP.
4
<PAGE>
OTHER BUSINESS
Management is not aware of any other matters that will come before the
meeting. If any other business should come before the meeting, however, your
proxy, if signed and returned, will give discretionary authority to the persons
designated in it to vote according to their best judgment.
OTHER INFORMATION
THE ADVISER AND PHOENIX DUFF & PHELPS. Duff & Phelps Investment Management
Co. is the Fund's investment adviser (the "Adviser") under an investment
advisory agreement (the "Advisory Agreement") dated November 1, 1995. The Fund
is also a party to a service agreement (the "Service Agreement") with the
Adviser and Phoenix Duff & Phelps Corporation ("Phoenix Duff & Phelps") dated
November 1, 1995. The Adviser is a wholly-owned subsidiary of Phoenix Duff &
Phelps, which is an indirect, majority-owned subsidiary of Phoenix Home Life
Mutual Insurance Company ("Phoenix Home Life"). The address of the adviser is
55 East Monroe Street, Chicago, Illinois 60603.
The Adviser (together with its predecessor) has been in the investment
advisory business for more than 60 years and, excluding the Fund, currently has
more than $15 billion in client accounts under discretionary management. The
Adviser also provides non-discretionary investment advisory and portfolio
consulting services to corporate and public retirement funds and endowment
funds aggregating more than $17 billion.
The Phoenix Duff & Phelps organization has provided investment research
regarding public utility securities since its founding in 1932. Phoenix Duff &
Phelps is one of the nation's largest independent investment research
organizations, providing to institutional investors equity and fixed-income
investment research. Through other subsidiaries it provides financial
consulting and investment banking services.
On November 1, 1995, Duff & Phelps Corporation merged (the "Merger") with
Phoenix Securities Group, Inc., a Connecticut corporation ("Phoenix Securities
Group"), a wholly-owned subsidiary of PM Holdings, Inc., a Connecticut
corporation, a wholly-owned subsidiary of Phoenix Home Life, a New York mutual
life insurance company. Pursuant to the Merger, Phoenix Securities Group merged
with and into Duff & Phelps Corporation, with the result that Duff & Phelps
Corporation became an indirect, majority-owned subsidiary of Phoenix Home Life.
Upon completion of the Merger, Duff & Phelps Corporation was renamed Phoenix
Duff & Phelps Corporation. Consummation of the Merger constituted an
"assignment," as defined in the Investment Company Act of 1940, as amended (the
"1940 Act"), of the investment advisory agreement in effect prior to the
Merger. As required by the 1940 Act, that investment advisory agreement
provided for its automatic termination in the event of an assignment.
Consequently, in order for the Adviser to continue providing investment
advisory services to the Fund after the closing of the Merger, a special
meeting of the Fund's shareholders was held on September 12, 1995, at which
meeting the Fund's shareholders approved the Advisory Agreement which became
effective upon completion of the Merger on November 1, 1995.
Under the terms of the Advisory Agreement, the Adviser furnishes continuing
investment supervision to the Fund and is responsible for the management of the
Fund's portfolio, subject to the overall control of the board of directors of
the Fund. The Adviser furnishes, at its own expense, office space, equipment
and
5
<PAGE>
personnel to the Fund in connection with the performance of its investment
management responsibilities, and pays all other expenses incurred by it in
connection with managing the assets of the Fund not payable by the Fund's
administrator pursuant to the administration agreement. The Advisory Agreement
also includes the conditions under which the Fund may use "Duff & Phelps" in
its name. For its services the Adviser receives from the Fund a quarterly fee,
payable out of the Fund's assets, at an annual rate of 0.60 of 1% of the
average weekly net assets of the Fund up to $1.5 billion and 0.50 of 1% of
average weekly net assets in excess of $1.5 billion. The management fee paid by
the Fund to the Adviser for 1995 was $11,689,418.
Except for the expenses borne by the Adviser and the Administrator (as
described below) pursuant to their respective agreements with the Fund, the
Fund pays all expenses incurred in its operations, including, among other
things expenses for legal, accounting and auditing services, taxes, interest,
costs of printing and distributing shareholder reports, proxy materials,
prospectuses and stock certificates, charges of custodians, registrars,
transfer agents, dividend disbursing agents, dividend reinvestment plan agents
and remarketing agents, Securities and Exchange Commission fees, fees and
expenses of non-interested directors, insurance, brokerage costs, litigation
and other extraordinary or non-recurring expenses.
Under the terms of the Service Agreement, Phoenix Duff & Phelps makes
available to the Adviser the services, on a part-time basis, of its employees
and various facilities to enable the Adviser to perform certain of its
obligations to the Fund. However, the obligation of performance under the
Advisory Agreement is solely that of the Adviser, for which Phoenix Duff &
Phelps assumes no responsibility, except as described in the preceding
sentence. The Adviser reimburses Phoenix Duff & Phelps for any costs, direct or
indirect, that are fairly attributable to the services performed and the
facilities provided by Phoenix Duff & Phelps under the Service Agreement. The
Fund does not pay any fees pursuant to the Service Agreement.
The Advisory Agreement and the Service Agreement both provide that the
Adviser and Phoenix Duff & Phelps shall not be liable to the Fund or its
shareholders for any loss suffered as a consequence of any act or omission of
the Adviser or Phoenix Duff & Phelps, as the case may be, in connection with
the respective agreements except by reason of its willful misfeasance, bad
faith or gross negligence in the performance of its duties or by reason of
reckless disregard of its obligations under the respective agreements.
Unless earlier terminated as described below, the Advisory Agreement and the
Service Agreement both continue until November 1, 1997, and thereafter from
year to year, if approved annually (i) by a majority of the directors of the
Fund who are not interested persons of the Fund or the Adviser, in the case of
the Advisory Agreement, or Phoenix Duff & Phelps, in the case of the Service
Agreement, and (ii) by either the board of directors of the Fund or the holders
of a majority of the outstanding shares of the Fund as defined in the 1940 Act.
A majority of the outstanding shares of the Fund as defined in the 1940 Act
means the following vote of each of the common stock and the preferred stock
voting separately by class: (i) 67% of the shares of the class represented at a
meeting at which more than 50% of the outstanding shares of the class are
represented; or (ii) more than 50% of the outstanding shares of the class. The
Advisory Agreement may be terminated without penalty on 60 days' written notice
by any party thereto or by a vote of the shareholders of the Fund and would
terminate automatically if it were assigned by any party. If the Advisory
Agreement were terminated, shareholder approval would be required to enter into
a new agreement. At a meeting held July 20, 1995, the board of directors of the
Fund, including all of the directors who are not interested persons of the Fund
or the Adviser in attendance at the meeting voting separately as a class,
unanimously voted to approve the Advisory Agreement and to recommend its
approval to the shareholders. As noted above, the Fund's shareholders approved
the Advisory Agreement at a special meeting held September 12, 1995. The
6
<PAGE>
Service Agreement may be terminated without penalty on 60 days' written notice
by any party thereto and would terminate automatically if it were assigned by
any party unless a majority of the Fund's board of directors, including a
majority of the directors who are not interested persons of the Fund or Phoenix
Duff & Phelps, approves continuation of the Service Agreement. The Service
Agreement was approved by a majority of the directors of the Fund who are not
interested persons of the Fund or Phoenix Duff & Phelps and by a majority of
the board of directors of the Fund at a meeting held on July 20, 1995.
The directors of the Adviser are Clyde E. Bartter, Calvin J. Pedersen and
Wayne C. Stevens. The principal occupations of Mr. Pedersen are shown under
"Other Information--Officers of the Fund" below. Mr. Bartter is Senior
Executive Vice President and Mr. Stevens is President and Chief Executive
Officer of the Adviser. The business address of Mr. Bartter is 600 Ohio Savings
Plaza, Cleveland, Ohio 44114. The business address of Messrs. Pedersen and
Stevens is 55 East Monroe Street, Chicago, Illinois 60603.
THE ADMINISTRATOR. J.J.B. Hilliard, W.L. Lyons, Inc. serves as the Fund's
administrator (the "Administrator") under an administration agreement (the
"Administration Agreement") dated November 1, 1995. The Administrator (together
with its predecessors) has been engaged in the investment business as a
securities broker-dealer and investment adviser since 1854. It also serves as
administrator and investment adviser to Hilliard-Lyons Government Fund, Inc., a
money market mutual fund, and Hilliard Lyons Growth Fund, Inc., an open-end
mutual fund, and is a wholly-owned subsidiary of Hilliard-Lyons, Inc. Its
principal address is Hilliard Lyons Center, Louisville, Kentucky 40202.
Under the terms of the Administration Agreement, the Administrator provides
all management and administrative services required in connection with the
operation of the Fund not required to be provided by the Adviser pursuant to
the Advisory Agreement, as well as the necessary office facilities, equipment
and personnel to perform such services. For its services, the Administrator
receives from the Fund a quarterly fee at annual rates of 0.25 of 1% of the
Fund's average weekly net assets up to $100 million, 0.20 of 1% of the Fund's
average weekly net assets from $100 million to $1.0 billion, 0.10 of 1% of
average weekly net assets from $1.0 billion to $1.5 billion and 0.06 of 1% of
average weekly net assets in excess of $1.5 billion. The total administrative
fee paid by the Fund to the Administrator for 1995 was $2,872,728.
The Administration Agreement provides that the Administrator shall not be
liable to the Fund or its shareholders for any loss suffered as a consequence
of any act or omission of the Administrator in connection with the agreement
except by reason of its willful misfeasance, bad faith or gross negligence in
the performance of its duties or by reason of reckless disregard of its
obligations under the agreement.
Unless earlier terminated as described below, the Administration Agreement
continues until November 1, 1997, and thereafter from year to year, if approved
annually (i) by a majority of the directors of the Fund who are not interested
persons of the Fund or the Administrator and (ii) by either the board of
directors of the Fund or the holders of a majority of the outstanding shares of
the Fund as defined in the 1940 Act. The Administration Agreement may be
terminated without penalty on 60 days' written notice by any party thereto or
by a vote of the shareholders of the Fund. The Administration Agreement was
approved by a majority of the directors of the Fund who are not interested
persons of the Fund or the Administrator and by a majority of the board of
directors of the Fund at a meeting held on July 20, 1995.
OFFICERS OF THE FUND. As noted above under "Election of Directors," Mr.
Hansen is chairman of the Fund. The name, positions with the Fund, principal
occupation during the past five years, age at February 1,
7
<PAGE>
1996 and address of each other executive officer of the Fund is set forth
below. The officers are elected at the annual meeting of the board of
directors.
CALVIN J. PEDERSEN, President and Chief Executive Officer, since April 1994
President, Phoenix Duff & Phelps Corporation since November 1995;
President, Duff & Phelps Corporation, 1993-November 1995 (Senior Vice
President, 1986-1988 and Executive Vice President, 1988-1993);
Executive Vice President and Director, Duff & Phelps Investment
Management Co. since 1988 (Senior Vice President, 1986-1988); President
and Chief Executive Officer, Duff & Phelps Utilities Tax-Free Income
Inc. and Duff & Phelps Utility and Corporate Bond Trust Inc.; Trustee,
Duff & Phelps Enhanced Reserves Fund; age 54; 55 East Monroe Street,
Chicago, Illinois 60603.
RICHARD J. SPLETZER, Senior Vice President, Chief Investment Officer and
Assistant Secretary, since January 1987
Executive Vice President, Duff & Phelps Investment Management Co. since
1993 (Senior Vice President, 1986-1993); Senior Vice President and Head
of Public Utility Research, Duff & Phelps Corporation, prior thereto;
director, Nuveen-Duff & Phelps Investment Advisors (a joint venture
between Nuveen Institutional Advisory Corp. and Duff & Phelps
Investment Management Co.); age 58; 55 East Monroe Street, Chicago,
Illinois 60603.
T. BROOKS BEITTEL, Secretary, Treasurer and Senior Vice President, since
January 1995
Senior Vice President, Duff & Phelps Investment Management Co. since
1993 (Vice President 1987-1993); age 45; 55 East Monroe Street,
Chicago, Illinois 60603.
JOSEPH C. CURRY, JR., Vice President, since April 1988
Senior Vice President, J.J.B. Hilliard, W.L. Lyons, Inc. since 1994
(Vice President 1982-1994); Vice President Hilliard Lyons Trust
Company; President and Director, Hilliard-Lyons Government Fund, Inc.;
Vice President, Hilliard Lyons Growth Fund, Inc.; age 51; Hilliard
Lyons Center, Louisville, Kentucky 40202.
DIANNA P. WENGLER, Assistant Secretary, since April 1988
Vice President, J.J.B. Hilliard, W.L. Lyons, Inc. since 1990; Vice
President and Treasurer, Hilliard-Lyons Government Fund, Inc.; Vice
President, Hilliard Lyons Growth Fund, Inc.; age 35; Hilliard Lyons
Center, Louisville, Kentucky 40202.
PORTFOLIO TRANSACTIONS. The Adviser has discretion to select brokers and
dealers to execute portfolio transactions initiated by the Adviser and to
select the markets in which such transactions are to be executed. In executing
portfolio transactions and selecting brokers or dealers, the primary
responsibility of the Adviser is to seek the best combination of net price and
execution for the Fund. The Fund ordinarily purchases securities in the primary
markets, and in assessing the best net price and execution available to the
Fund, the Adviser considers all factors it deems relevant, including the
breadth of the market in the security, the price of the security, the financial
condition and execution capability of the broker or dealer and the
reasonableness of the commission, if any (for the specific transaction and on a
continuing basis).
8
<PAGE>
In selecting brokers or dealers to execute particular transactions and in
evaluating the best net price and execution available, the Adviser is
authorized to consider "brokerage and research services" (as those terms are
defined in Section 28(e) of the Securities Exchange Act of 1934), statistical
quotations, specifically the quotations necessary to determine the Fund's net
asset value, and other information provided to the Fund and/or the Adviser (or
their affiliates). The Adviser is also authorized to cause the Fund to pay to a
broker or dealer who provides such brokerage and research services a commission
for executing a portfolio transaction which is in excess of the amount of
commission another broker or dealer would have charged for effecting that
transaction. The Adviser must determine in good faith, however, that such
commission was reasonable in relation to the value of the brokerage and
research services provided, viewed in terms of that particular transaction or
in terms of all the accounts over which the Adviser exercises investment
discretion. It is possible that certain of the services received by the Adviser
attributable to a particular transaction will benefit one or more other
accounts for which investment discretion is exercised by the Adviser.
The Advisory Agreement requires the Adviser to provide fair and equitable
treatment to the Fund in the selection of portfolio investments and the
allocation of investment opportunities between the Fund and the Adviser's other
investment management clients, but does not obligate the Adviser to give the
Fund exclusive or preferential treatment. It is likely that from time to time
the Adviser may make similar investment decisions for the Fund and its other
clients. In some cases, the simultaneous purchase or sale of the same security
by the Fund and another client of the Adviser could have a detrimental effect
on the price or volume of the security to be purchased or sold, as far as the
Fund is concerned. In other cases, coordination with transactions for other
clients and the ability to participate in volume transactions could benefit the
Fund.
Although the Fund purchases securities for investment income or capital
appreciation, or both, and not for short-term trading profits, it may dispose
of securities without regard to the time they have been held when such action
appears advisable to the Adviser.
During 1995, the Fund paid brokerage commissions aggregating $5,876,415 in
connection with its portfolio transactions, not including the gross
underwriting spread on securities purchased in underwritten public offerings or
the spread in over-the-counter transactions with firms acting as principal. The
Administrator received $69,195 or approximately 1.2% of total brokerage
commissions in 1995 for effecting transactions involving 0.5% of the aggregate
dollar amount of transactions in which the Fund paid brokerage commissions.
Duff & Phelps Securities Co., a wholly-owned subsidiary of Phoenix Duff &
Phelps, received $75,175 or approximately 1.3% of total brokerage commissions
in 1995 for effecting transactions involving 0.6% of the aggregate dollar
amount of transactions in which the Fund paid brokerage commissions.
9
<PAGE>
SHAREHOLDERS. The following table shows shares of common stock of the Fund as
to which each director, and all directors and officers of the Fund as a group,
had or shared power over voting or disposition at January 15, 1996. The
directors and officers of the Fund owned no shares of the Fund's remarketed
preferred stock. Shares are held with sole power over voting and disposition
except as noted. The shares of common stock held by each of the persons listed
below and by all directors and officers as a group represented less than 1% of
the outstanding common stock.
<TABLE>
<CAPTION>
SHARES
OF
COMMON
STOCK
-------
<S> <C>
Wallace B. Behnke(2).............................................. 2,284
Harry J. Bruce.................................................... 21,095
Franklin A. Cole(2)............................................... 3,264
Gordon B. Davidson(1)............................................. 18,000
Robert J. Day..................................................... 13,767
Claire V. Hansen(1)............................................... 26,636
Francis E. Jeffries(1)............................................ 63,339
Nancy Lampton..................................................... 1,478
Beryl W. Sprinkel................................................. 300
Directors and officers as a group (14 persons)(1)(2).............. 237,266
</TABLE>
- --------
(1) Messrs. Davidson, Hansen and Jeffries disclaim beneficial ownership of
7,000, 5,010 and 4,568, respectively, of the shares listed. The directors
and officers disclaim beneficial ownership of 22,692, in the aggregate, of
the shares listed as owned by the directors and officers as a group.
(2) Messrs. Behnke and Cole had shared power to vote and/or dispose of the
shares listed. The directors and officers had shared power to vote and/or
dispose of 8,274 of the shares listed as owned by the directors and
officers as a group.
At January 15, 1996, no person was known by the Fund to own beneficially 5%
or more of the outstanding shares of the Fund (as determined in accordance with
Rule 13d-3 under the Securities Exchange Act of 1934).
Section 16(a) of the Securities Exchange Act of 1934 requires the Fund's
officers and directors, and persons who own more than 10% of a registered class
of the Fund's equity securities, to file reports of ownership and changes in
ownership with the Securities and Exchange Commission and the New York Stock
Exchange. Officers, directors and greater than 10% shareholders are required by
Securities and Exchange Commission regulations to furnish the Fund with copies
of all Section 16(a) forms they file. Based solely on review of the copies of
such forms furnished to the Fund, or written representations that no Forms 5
were required, the Fund believes that during 1995 all Section 16(a) filing
requirements applicable to its officers, directors and greater than 10%
beneficial owners were complied with.
SOLICITATION OF PROXIES. Proxies will be solicited by mail. Proxies may be
solicited by Fund personnel personally or by telephone, telegraph or mail, but
such persons will not be specially compensated for such services. The Fund will
inquire of any record holder known to be a broker, dealer, bank or other
nominee as to whether other persons are the beneficial owners of shares held of
record by such persons. If so, the Fund will supply additional copies of
solicitation materials for forwarding to beneficial owners, and will make
10
<PAGE>
reimbursement for reasonable out-of-pocket costs. In addition, the Fund may
hire a proxy solicitor to assist the Fund in the solicitation of proxies at a
fee of approximately $15,000, plus out-of-pocket expenses.
SHAREHOLDER PROPOSALS. Any shareholder proposal to be considered for
inclusion in the Fund's proxy statement and form of proxy for the 1997 annual
meeting of shareholders should be received by the Secretary of the Fund no
later than November 13, 1996.
ANNUAL AND SEMI-ANNUAL REPORTS. The Fund will provide without charge to any
shareholder who so requests, a copy of the Fund's annual report for the year
ended December 31, 1995 and the Fund's semi-annual report for the six months
ended June 30, 1995. Requests for copies of such reports should be directed to
the Administrator at (800) 680-4367 (toll-free).
GENERAL. A list of shareholders entitled to be present and vote at the annual
meeting will be available at the offices of the Fund, 55 East Monroe Street,
Chicago, Illinois 60603, for inspection by any shareholder during regular
business hours for ten days prior to the date of the meeting.
Failure of a quorum to be present at the annual meeting will necessitate
adjournment and will give rise to additional expense.
ALL SHAREHOLDERS ARE REQUESTED TO SIGN, DATE AND MAIL PROXIES PROMPTLY IN THE
RETURN ENVELOPE PROVIDED.
March 11, 1996
11
<PAGE>
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DUFF & PHELPS UTILITIES INCOME INC.
PROXY SOLICITED BY MANAGEMENT FROM COMMON SHAREHOLDERS
FOR MEETING TO BE HELD ON April 18, 1996
Harry J. Bruce, Franklin A. Cole and Nancy Lampton or any of them, each
with full power of substitution, are authorized to vote all shares of common
stock of Duff & Phelps Utilities Income Inc. owned by the undersigned at the
meeting of shareholders to be held April 18, 1996, and at any adjournment of the
meeting. They shall vote in accordance with the instructions set forth on the
reverse side hereof.
If no specific instructions are provided, this proxy will be voted "FOR"
proposals 1 and 2 and in the discretion of the proxies upon such other business
as may properly come before the meeting.
(Continued and to be signed on other side)
DUFF & PHELPS UTILITIES INCOME INC.
P.O. BOX 11435
NEW YORK, N.Y. 10208-0485
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
------
| |
------
1. Election of Directors
FOR all nominees listed below [_]
WITHHOLD AUTHORITY to vote for all nominees listed below. [_]
*EXCEPTIONS [_]
Nominees: Wallace B. Behnke, Gordon B. Davidson and Claire V. Hansen
(INSTRUCTIONS: To withhold authority to vote for individual nominees, mark the
"Exceptions" box and write the names of those nominees in the space provided
below.)
*Exceptions ____________________________________________________________________
2. Ratification of the selection of Arthur Andersen LLP as independent public
accountants of the Fund.
FOR [_] AGAINST [_] ABSTAIN [_]
Change of Address or
Comments Mark Here [_]
IMPORTANT: Please sign exactly as your
name or names appear on the shareholder
records of the Fund. If you sign as agent
or in any other representative capacity,
please state the capacity in which you
sign. Where there is more than one owner,
each should sign.
Dated:_____________________________, 1996
_________________________________________
_________________________________________
(Signature(s) of Stockholder(s)
Votes must be indicated (X) in Black or Blue Ink. [_]
Please Vote, Date, and Sign and Return Promptly in the Enclosed Envelope
- --------------------------------------------------------------------------------
<PAGE>
- --------------------------------------------------------------------------------
DUFF & PHELPS UTILITIES INCOME INC.
PROXY SOLICITED BY MANAGEMENT FROM PREFERRED SHAREHOLDERS
FOR MEETING TO BE HELD ON APRIL 18, 1996
Harry J. Bruce, Franklin A. Cole and Nancy Lampton or any of them, each with
full power of substitution, are authorized to vote all shares of preferred
stock of Duff & Phelps Utilities Income Inc. owned by the undersigned at the
meeting of shareholders to be held April 18, 1996, and at any adjournment of
the meeting. They shall vote in accordance with the instructions set forth
below.
1. Ratification of the selection of Arthur Andersen LLP as independent public
accountants of the Fund.
FOR [_] WITHHOLD [_] ABSTAIN [_]
IF NO SPECIFIC INSTRUCTIONS ARE PROVIDED, THIS PROXY WILL BE VOTED "FOR"
PROPOSAL 1 AND IN THE DISCRETION OF THE PROXIES UPON SUCH OTHER BUSINESS AS MAY
PROPERLY COME BEFORE THE MEETING.
(CONTINUED AND TO BE SIGNED ON OTHER SIDE.)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Dated , 1996 (please fill in, sign and date this proxy
and mail it in the envelope provided.)
-----------------------------------
-----------------------------------
(Signature(s) of Shareholder(s))
IMPORTANT: Please sign exactly as
your name or names appear on the
shareholder records of the Fund.
If you sign as agent or in any
other representative capacity,
please state the capacity in which
you sign. Where there is more than
one owner, each should sign.
- --------------------------------------------------------------------------------
