COLONIAL INTERMEDIATE HIGH INCOME FUND
One Financial Center, Boston, Massachusetts 02111
(617) 426-3750
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD APRIL 28, 1995
Dear Fellow Shareholder:
The Annual Meeting of Shareholders (Meeting) of Colonial
Intermediate High Income Fund (Fund) will be held at the offices of
Colonial Management Associates, Inc. (Adviser), One Financial
Center, Boston, Massachusetts, on Friday, April 28, 1995, at 10:00
a.m. Eastern time, to:
1. Elect five Trustees;
2. Ratify or reject the selection of independent accountants; and
3. Transact such other business as may properly come before the Meeting
or any adjournment thereof.
By order of the Trustees,
Arthur O. Stern, Secretary
March 24, 1995
NOTICE: YOUR VOTE IS IMPORTANT, REGARDLESS OF THE NUMBER OF SHARES
YOU OWN. IF A QUORUM IS NOT PRESENT AT THE MEETING, ADDITIONAL
EXPENSES WILL BE INCURRED TO SOLICIT ADDITIONAL PROXIES. TO AVOID
THESE COSTS TO YOUR FUND, PLEASE VOTE, SIGN AND RETURN YOUR PROXY
IN THE ENCLOSED POSTAGE-PAID ENVELOPE IMMEDIATELY.
IH-85/761A-0395
PROXY STATEMENT
General Information
March 24, 1995
The enclosed proxy, which was first mailed on March 24, 1995, is
solicited by the Trustees for use at the Meeting. All properly
executed proxies received in time for the Meeting will be voted as
specified in the proxy or, if no specification is made, in favor of
each proposal referred to in the Proxy Statement. The proxy may be
revoked prior to its exercise by a later dated proxy, by written
revocation received by the Secretary or by voting in person.
Solicitation may be made by mail, telephone, telegraph, telecopy
and personal interviews. Authorization to execute proxies may be
obtained by telephonically or electronically transmitted
instructions. The cost of solicitation will be paid by the Fund.
A majority of the shares outstanding and entitled to vote
constitutes a quorum and must be present in person or represented
by proxy for business to be transacted at the Meeting. On February
1, 1995, the Fund had outstanding 13,964,796.823 shares of
beneficial interest. Shareholders of record at the close of
business on February 1, 1995 will have one vote for each share
held. As of February 1, 1995, Cede & Co., Common Account, Box 20,
Bowling Green Station, New York, New York 10004 owned of record
82.47% of the Fund's outstanding shares.
Votes cast by proxy or in person will be counted by persons
appointed by the Fund to act as election tellers for the Meeting.
The tellers will count the total number of votes cast "for"
approval of the proposals for purposes of determining whether
sufficient affirmative votes have been cast. Where a shareholder
withholds authority or abstains, or the proxy reflects a "broker
non-vote" (i.e., shares held by brokers or nominees as to which (i)
instructions have not been received from the beneficial owners or
persons entitled to vote and (ii) the broker or nominee does not
have the discretionary voting power on a particular matter), the
shares will be counted as present and entitled to vote on the
matter for purposes of determining the presence of a quorum. With
respect to the election of Trustees and ratification of independent
accountants, withheld authority, abstentions and broker non-votes
have no effect on the outcome of the voting.
Further information concerning the Fund is contained in its most
recent Annual Report to shareholders, which is obtainable free of
charge by writing the Adviser at One Financial Center, Boston, MA
02111 or by calling 1-800-248-2828.
1. Election of Five Trustees.
Messrs. Birnbaum, Grinnell, Lowry, Mayer and Sullivan (who have
each agreed to serve) are proposed for election as Trustees of the
Fund each to serve for three years or until a successor is
elected. Messrs. Mayer and Sullivan currently serve as Trustees.
Messrs. Birnbaum, Grinnell and Lowry are proposed to be added to
the Board. The election of each of Messrs. Birnbaum, Grinnell and
Lowry is conditioned on (1) the closing of the Merger described
below (Merger) of The Colonial Group, Inc. (TCG), parent company of
the Adviser, with a subsidiary of Liberty Financial Companies, Inc.
(Liberty Financial) (currently scheduled to occur on or about March
24, 1995) and (ii) their nomination by the current Trustees at a
meeting scheduled for April 21, 1995. The Board of Trustees
currently consists of Ms. Collins and Messrs. Bleasdale, Ireland,
Mayer, McNeice, Moody, Neuhauser, Shinn, Sullivan and Weeks. The
Board currently is divided into the following three classes, each
with a three year term expiring in the years indicated (assuming
the persons listed above, other than Messrs. Birnbaum, Grinnell and
Lowry, are elected at the Meeting):
1996 1997 1998
Mr. Bleasdale Mr. McNeice Mr. Mayer
Ms. Collins Mr. Moody Mr. Sullivan
Mr. Ireland Mr. Shinn
Mr. Neuhauser Mr. Weeks
The years in which Messrs. Birnbaum's, Grinnell's and Lowry's
terms will expire will be determined by the current Trustees at
their April meeting.
The following table sets forth certain information about the
current Trustees and about Messrs. Birnbaum, Grinnell and Lowry:
Shares Beneficially
Nominee Name Owned and Percent
Age Trustee Since Principal Occupation(1) of Fund at February 1,
and Directorships 1995(2)
------------------ ----------------------- -----------------------
Robert J. Retired January, 1994; ----
Birnbaum Special Counsel, Dechert
(67) Price & Rhoads (September,
1988 to December, 1993);
President and Chief
Operating Officer, New
York Stock Exchange (May,
1985 to June, 1988);
Trustee, Liberty Financial
Trust.
Tom Retired (formerly Chairman ----
Bleasdale of the Board and Chief
(64) 1988 Executive Officer, Shore
Bank & Trust Co.).
Director or Trustee:
Colonial Funds (3), Stok,
Inc.
Lora S. Attorney, Kramer, Levin, ----
Collins Naftalis, Nessen, Kamin &
(59) 1988 Frankel (law). Trustee:
Colonial Funds (3).
James E. Private Investor (since ----
Grinnell November, 1988); Senior
(65) Vice President-Operations,
The Rockport Company,
importer and distributor
of shoes (May, 1986 to
November, 1988); Trustee,
Liberty Financial Trust.
William D. Retired (formerly Chairman ----
Ireland, Jr. of the Board, Bank of New
(71) 1992 England--Worcester).
Trustee: Colonial Funds (3).
Richard W. Private Investor (August, ----
Lowry 1987 to present); Chairman
(58) and Chief Executive
Officer, U.S. Plywood
Corporation, manufacturer
and distributor of wood
products (August, 1985 to
August, 1987); Trustee,
Liberty Financial Trust.
William E. Dean of the College of ----
Mayer* Business and Management,
(54) 1994 University of Maryland
(formerly Dean of the
Simon Graduate School of
Business, University of
Rochester; Chairman and
Chief Executive Officer,
C.S. First Boston Merchant
Bank; and President and
Chief Executive Officer,
The First Boston Corporation).
Director or Trustee: Colonial
Funds(3), Hambrecht & Quist
Incorporated; American
Medical Inc.; Chart House
Enterprises; Riverwood
International Corp.
John A. Chairman of the Board and ----
McNeice, Jr.* Director of TCG: Chairman
(62) 1988 of the Board, Chief
Executive Officer and
Director of the Adviser.
Trustee: Colonial Funds (3).
James L. Chairman of the Board,
Moody, Jr. Hannaford Bros. Co. (food ----
(63) 1988 distributor) (formerly
Chief Executive Officer,
Hannaford Bros. Co.).
Director or Trustee:
Colonial Funds (3),
Penobscot Shoe Co., Sobeys
Inc., Hills Stores
Company, UNUM Corporation,
IDEXX Laboratories.
John J. Dean of the School of ----
Neuhauser Management, Boston
(51) 1992 College. Director or
Trustee: Colonial Funds
(3), Hyde Athletic
Industries, Inc.
George L. Financial Consultant ----
Shinn (formerly Chairman, Chief
(72) 1992 Executive Officer and
Consultant, The First
Boston Corporation).
Trustee or Director:
Colonial Funds (3), The
New York Times Co., Phelps
Dodge Corp.
Robert L. Management Consultant. ----
Sullivan Trustee: Colonial Funds(3).
(67) 1989
Sinclair Chairman of the Board, ----
Weeks, Jr. Reed & Barton Corporation.
(71) 1992 Director or Trustee:
Colonial Funds (3),
Commonwealth Energy
Systems.
* Mr. McNeice is an "interested person" as defined by the
Investment Company Act of 1940 (1940 Act), because of his
affiliation with TCG and the Adviser. Mr. Mayer is an
"interested person" because of his affiliation with Hambrecht
& Quist Incorporated (a registered broker dealer).
(1) Except as otherwise noted, each individual has held the
office indicated or other offices in the same company for the
last five years.
(2) On February 1, 1995, the Trustees and officers of the Fund
beneficially owned less than 1% of the then outstanding shares
of the Fund.
(3) The Colonial Funds include: Colonial Trust I, Colonial Trust
II, Colonial Trust III, Colonial Trust IV, Colonial Trust V,
Colonial Trust VI, Colonial High Income Municipal Trust,
Colonial InterMarket Income Trust I, Colonial Intermediate
High Income Fund, Colonial Investment Grade Municipal Trust
and Colonial Municipal Income Trust.
The following table sets forth certain information about the
executive officers of the Fund:
Name
Age Executive Officer Since Principal Occupation(4)
John A. McNeice, Jr. President and Trustee
62 1987 of the Fund: Chairman
of the Board, Chief
Executive Officer and
Director of the
Adviser: Chairman of
the Board and Director
of TCG: President and
Trustee of Colonial
Funds (5).
Harold W. Cogger Vice President of the
59 1993 Fund: President and
Director of the
Adviser (formerly
Executive Vice
President): President,
Chief Executive
Officer and Director
of TCG: Vice President
of Colonial Funds (5).
Davey S. Scoon Vice President of the
48 1993 Fund (formerly
Treasurer): Executive
Vice President and
Director of the
Adviser (formerly
Senior Vice President
and Treasurer):
Executive Vice
President and Chief
Operating Officer of
TCG (formerly Vice
President - Finance
and Administration and
Treasurer): Vice
President of Colonial
Funds (formerly
Treasurer) (5).
Carl C. Ericson Vice President of the
51 1989 Fund: Vice President
of the Adviser.
Andrea S. Feingold Vice President of the
31 1993 Fund (formerly
Assistant Treasurer):
Vice President of
Adviser (formerly
Assistant Vice
President and Analyst
of the Adviser):
formerly Investment
Analyst, Sun Financial
Group.
Richard A. Silver Treasurer and Chief
48 1993 Financial Officer of
the Fund (formerly
Controller): Senior
Vice President,
Director, Treasurer
and Chief Financial
Officer of the
Adviser: Treasurer
and Chief Financial
Officer of TCG
(formerly Assistant
Treasurer): Treasurer
and Chief Financial
Officer of Colonial
Funds (5).
Peter L. Lydecker Controller of the Fund
41 1993 (formerly Assistant
Controller): Vice
President of the
Adviser (formerly
Assistant Vice
President): Controller
of Colonial Funds
(formerly Assistant
Controller) (5).
(4) Except as otherwise noted, each individual has held the office
indicated or other offices in the same company for the last
five years.
(5) The Colonial Funds include: Colonial Trust I, Colonial Trust
II, Colonial Trust III, Colonial Trust IV, Colonial Trust V,
Colonial Trust VI, Colonial High Income Municipal Trust,
Colonial InterMarket Income Trust I, Colonial Intermediate
High Income Fund, Colonial Investment Grade Municipal Trust
and Colonial Municipal Income Trust.
Certain officers and Trustees of the Fund also hold positions
with the other Colonial Funds for which the Adviser acts as
investment adviser.
Trustees Meetings and Committees
During the fiscal year ended October 31, 19943, the Board held
seven meetings. The current Trustees received the following
compensation from the Fund for the fiscal year ended October 31,
1994 and from the Colonial Funds for the calendar year ended
December 31, 1994, for serving as Trustees:
Aggregate Pension Estimated Total
Compensa- or Retire- Annual Compensa-
tion From ment Benefits tion From
Fund for Benefits Upon Fund and
the fiscal Accrued Retire- Fund Complex
year ended As Part ment for the
Trustee 10/30/94 of Fund calendar year
Expense ended
12/31/94(b)
--------- ---------- -------- ------- ------------
Tom Bleasdale $1,391(a) $0 $0 $101,000
Lora S. Collins 1,310 0 0 95,000
William D. Ireland, Jr. 1,519 0 0 110,000
William E. Mayer 1,133 0 0 89,752
John A. McNeice, Jr. 0 0 0 0
James L. Moody, Jr. 1,416 0 0 109,000
John J. Neuhauser 1,312 0 0 95,000
George L. Shinn 1,548 0 0 112,000
Robert L. Sullivan 1,462 0 0 104,561
Sinclair Weeks, Jr. 1,601 0 0 116,000
(a) Includes $679 as deferred compensation.
(b) The Colonial Funds Complex consists of 31 open-end and 5 closed-end
management investment portfolios advised by the Adviser.
The following table sets forth the amount of compensation paid
to Messrs. Birnbaum, Grinnell and Lowry in their capacities as
Trustees of the Liberty All-Star Equity Fund, The Charles Allmon
Trust, Inc., Liberty Financial Trust and LFC Utilities Trust
(together, Liberty Funds) for service during the calendar year
ended December 31, 1994:
Aggregate Pension Estimated Total
Compen- or Retire- Annual Compensa-
sation ment Benefits tion From
From Fund Benefits Upon Liberty Funds
for the Accrued Retire- for the
fiscal As Part ment calendar
year ended of Fund year ended
Trustee 10/31/94 Expense 12/31/94(c)
-------- ---------- -------- ------- ------------
Robert J. Birnbaum $0 $0 $0 $ 0
James E. Grinnell 0 0 0 31,032
Richard W. Lowry 0 0 0 31,282
(c) The Liberty Funds consist of 5 open-end and 2 closed-end management
investment company portfolios, each of which is advised by Stein Roe &
Farnham Incorporated, an indirect wholly-owned subsidiary of Liberty
Financial.
The Audit Committee of the Colonial Funds, consisting of Messrs.
Bleasdale, Ireland, Moody, Shinn, Sullivan and Weeks, met twice
during the fiscal year ended October 31, 1994. The Committee
recommends to the Trustees the independent accountants to serve as
auditors, reviews with the independent accountants the results of
the auditing engagement and internal accounting procedures and
controls, and considers the independence of the independent
accountants, the range of their audit services and their fees.
The Compensation Committee of the Colonial Funds, consisting of
Ms. Collins and Messrs. Neuhauser, Sullivan and Weeks, met once
during the fiscal year ended October 31, 1994. The Committee
reviews compensation of the Trustees.
The Nominating Committee of the Colonial Funds, consisting of
Messrs. Bleasdale, Ireland, Moody and Weeks, met twice during the
fiscal year ended October 31, 1994. The Committee in its sole
discretion recommends to the Trustees nominees for Trustee and for
appointments to various committees. The Committee will consider
candidates for Trustee recommended by shareholders. Written
recommendations with supporting information should be directed to
the Committee in care of the Fund.
During the fiscal year ended October 31, 1994, each of the
current Trustees attended more than 75% of the meetings of the
Board and the committees of which such Trustee is a member.
If any of the nominees listed above become unavailable for
election, the enclosed proxy may be voted for a substitute
candidate in the discretion of the proxy holder(s). If the
conditions set forth on pages 2 and 3 are not fulfilled, the
enclosed proxy will not be voted for the election of Messrs.
Birnbaum, Grinnell and Lowry.
Required Vote
A plurality of the votes cast at the Meeting, if a quorum is
represented, is required for the election of each Trustee.
Description of the Adviser. The Adviser is a wholly-owned
subsidary of TCG. On October 12, 1994, TCG, Liberty Financial and
Apple Merger Corporation (Merger Subsidiary), a wholly-owned
subsidary of Liberty Financial, entered into an Agreement and Plan
of Merger, which was amended and restated as of February 8, 1995
(Merger Agreement). Pursuant to the Merger Agreement, TCG, subject
to the satisfaction of certain conditions (including, among others,
adoption and approval of the Merger Agreement by the stockholders
of TCG and receipt of approvals of new Management Agreements by the
shareholders of 90% of the Colonial Funds and the other registered
investment companies for which TCG or its subsidiaries, including
the Adviser, acts as an investment adviser, as measured by net
assets), or in certain cases, waiver of conditions, will merge with
Merger Subsidiary with TCG being the surviving corporation
(Surviving Corporation). Over 90% of the Colonial Funds'
shareholders approved the new Management Agreements at the Special
Meetings of Shareholders held on February 15, 1995. The Surviving
Corporation will remain a wholly-owned subsidary of Liberty
Financial. Current TCG stockholders will become stockholders of
Liberty Financial unless they elect to receive cash in exchange for
their stock. After the Merger, the Adviser will be a wholly-owned
subsidiary of the Surviving Corporation. The Merger, together with
certain other matters contemplated by the Merger Agreement,
constitute the Transaction.
Liberty Financial is currently an indirect subsidiary of Liberty
Mutual Insurance Company (Liberty Mutual). Liberty Financial is a
diversified and integrated asset management organization which
provides insurance and investment products to individuals and
institutions. Its principal executive offices are located at 600
Atlantic Avenue, 24th Floor, Boston, Massachusetts 02210. After
the closing of the Transaction (Closing), the only stockholders of
Liberty Financial other than Liberty Mutual will be those TCG
stockholders who receive Liberty Financial stock in the Merger.
Liberty Mutual is a Massachusetts-chartered mutual property and
casualty insurance company with over $20.6 billion in assets and
$3.5 billion in surplus at December 31, 1994. The principal
business activities of Liberty Mutual's subsidiaries other than
Liberty Financial are property-casulty insurance, insurance
services and life insurance (including group life and health
insurance products) marketed through its own sales force. Its
principal executive offices are located at 175 Berkeley Street,
Boston, Massachusetts 02117.
John A. McNeice, Jr., who is President and a Trustee of the
Colonial Funds, presently holds 1,464,000 shares of TCG Class A
Common Stock, representing 20.24% of the Class A Common Stock of
TCG, and 98,437 shares of TCG Class B Common Stock, representing
50.94% of its outstanding Class B Stock. Because of his stock
ownership, he is considered to be a controlling person of TCG and
of the Adviser, which is a wholly-owned subsidiary of TCG. After
the Closing, Mr. McNeice will no longer be a controlling person of
the Adviser.
In connection with the Merger, unless holders of TCG Common
Stock (Common Stock) elect otherwise, each share of Common Stock
will be converted into the right to receive one share of Liberty
Financial Common Stock (New Common Stock). Alternatively, a TCG
stockholder may elect, with respect to all or some of his or her
shares, to convert such holder's Common Stock into either, but not
both, of (i) the right to receive $40.00 in cash per share of
Common Stock or (ii) the right to receive .77 shares of Series A
Convertible Preferred Stock of Liberty Financial (New Preferred
Stock) per share of Common Stock. Notwithstanding these
alternatives, the aggregate cash paid to TCG stockholders will be
limited to $100 million and the total amount of New Preferred Stock
issued to stockholders will be limited to 1,040,000 shares. If
such limits are reached, the number of shares of Common Stock
subject to elections to receive cash or New Preferred Stock, as the
case may be, will be reduced ratably based on the number of shares
elected to be so treated by each stockholder. As of November 30,
1994, there were 7,166,646 shares of Class A Common Stock and
193,217 shares of Class B Common Stock outstanding.
2. Ratification of Independent Accountants.
Price Waterhouse LLP was selected as independent accountants for
the Fund for the fiscal year ending October 31, 1995, by unanimous
vote of the Trustees, subject to ratification or rejection by the
shareholders. Neither Price Waterhouse LLP nor any of its partners
has any direct or material indirect financial interest in the Fund.
Price Waterhouse LLP also acts as independent accountants for the
Adviser and affiliated companies. A representative of Price
Waterhouse LLP will be available at the Meeting to respond to
appropriate questions and make a statement (if the representative
desires), if requested by a shareholder in writing at least five
days before the Meeting.
Required Vote
Ratification requires the affirmative vote of a majority of the
shares of the Fund represented at the Meeting.
3. Other Matters and Discretion of Attorneys Named in the Proxy
At this date only the business mentioned in Items 1 and 2 of the
Notice of the Meeting is contemplated to be presented. If any
procedural or other matters properly come before the Meeting, the
enclosed proxy shall be voted in accordance with the best judgment
of the proxy holder(s).
The Meeting is called to be held at the same time as the meeting
of shareholders of Colonial Municipal Income Trust. It is
anticipated that such meetings will be held simultaneously. In the
event that any Fund shareholder at the Meeting objects to the
holding of a simultaneous meeting and moves for an adjournment of
the meetings so that the Meeting of the Fund may be held
separately, the persons named as proxies will vote in favor of such
an adjournment.
If a quorum of shareholders (a majority of the shares entitled
to vote at the Meeting) is not represented at the Meeting or at any
adjournment thereof, or, even though a quorum is so represented, if
sufficient votes in favor of the Items set forth in the Notice of
the Meeting are not received by April 28, 1995, the persons named
as proxies may propose one or more adjournments of the Meeting for
a period or periods of not more than ninety days in the aggregate
and further solicitation of proxies may be made. Any such
adjournment may be effected by a majority of the votes properly
cast in person or by proxy on the question at the session of the
Meeting to be adjourned. The persons named as proxies will vote in
favor of such adjournment those proxies which they are entitled to
vote in favor of the Items set forth in the Notice of the Meeting.
They will vote against any such adjournment those proxies required
to be voted against any of such Items.
Date for Receipt of Shareholder Proposals
Proposals of shareholders which are intended to be considered
for inclusion in the Fund's proxy statement relating to the 1996
Annual Meeting of Shareholders of the Fund must be received by the
Fund at One Financial Center, Boston, Massachusetts 02111 on or
before December 8, 1995.
Shareholders are urged to vote, sign and mail their proxies
immediately.
COLONIAL INTERMEDIATE HIGH INCOME FUND
This Proxy is Solicited on Behalf of the Trustees.
PROXY
The undersigned shareholder hereby appoints Michael H. Koonce, John
A. McNeice, Jr. and Arthur O. Stern, and each of them, proxies of
the undersigned, with power of substitution, to vote at the Annual
Meeting of Shareholders of Colonial Intermediate High Income Fund,
to be held at Boston, Massachusetts, on Friday, April 28, 1995, and
at any adjournments, as follows on the reverse side:
This proxy when properly executed will be voted in the manner directed below
and, absent direction, will be voted for Items 1 and 2 listed below.
1. ELECTION OF FIVE TRUSTEES (Item 1 of the Notice).
Nominees: Robert J. Birnbaum, James E. Grinnell, Richard W. Lowry,
William E. Mayer, Robert L. Sullivan
________ FOR the nominees listed (except as marked to the contrary below)
________ WITHHOLD AUTHORITY to vote for the nominees listed
----------------------------------------------------------------------------
INSTRUCTION: To withhold authority to vote for any individual nominee write
that nominee's name on the line.
2. PROPOSAL TO RATIFY THE SELECTION OF INDEPENDENT ACCOUNTANTS.
(Item 2 of the Notice)
____ FOR ____ AGAINST ____ ABSTAIN
3. IN THEIR DISCRETION, UPON SUCH OTHER MATTERS AS MAY PROPERLY
COME BEFORE THE MEETING.
__________MARK HERE FOR ADDRESS CHANGE AND NOTE AT LEFT
Please sign exactly as name appears hereon.
When signing as attorney, executor, administrator,
trustee or guardian, please give full title as
such. If a corporation, please sign in full
corporate name by President or other authorized
officer. If a partnership, please sign in
partnership name by authorized person.
Signature___________________Date__________________
Signature___________________Date__________________
PLEASE MARK, SIGN, DATE AND RETURN THIS PROXY
PROMPTLY USING THE ENCLOSED ENVELOPE.
