PROSPECT STREET HIGH INCOME PORTFOLIO INC.
60 State Street
Suite 3750
Boston, MA 02109
February 20, 1998
SECOND REQUEST
Dear Shareholder:
You have previously received proxy material in connection with the
upcoming Annual Meeting of Shareholders of Prospect Street High Income Portfolio
Inc. to be held on March 11, 1998. Your Board of Directors has carefully
considered the proposals on the ballot for this meeting, and believes it is in
the best interest of the Fund and our shareholders to approve all proposals.
It is critical that Proposals 2,3 and 4 be approved now:
Proposals 2 and 3
- The Fund's existing preferred stock is subject to mandatory
retirement in 1998.
- The approval sought is to replace the retiring preferred stock
and provide additional leverage to maintain the current
leverage ratio.
- In order to provide the opportunity to maintain the Fund's
current earnings and dividend capacity for the Common
Stockholders we will need to replace the leverage which is
expiring.
Proposal 4
- The approval of Proposal 4 will allow the Board of Directors
to modify the restriction on illiquid securities to enable the
Fund to purchase Rule 144A securities which now dominate the
high yield securities market.
- The Board of Directors intends to replace the current
fundamental restriction with a non-fundamental restriction
providing that the Fund will not invest more than 30% of its
total assets in securities which are not readily marketable.
Investment in Rule 144A securities is essential to Fund
operations.
Your Board of Directors recommends a vote in favor of all
proposals.
According to our latest records, your proxy for this meeting has not
been received. Regardless of the number of shares you may own, it is important
that they be represented at this meeting. Your vote is very important and we
need your support.
Please sign, date and mail the enclosed proxy card promptly. We
appreciate your time and support.
Sincerely,
/s/ Richard E. Omohundro
--------------------------------------------
Richard E. Omohundro, Jr., CFA
President
IF YOU HAVE RECENTLY MAILED YOUR PROXY,
PLEASE ACCEPT OUR THANKS AND DISREGARD THIS REQUEST.
