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 Rule 14a-11(c) or
Rule 14a-12
The Herzfeld Carribean Basin Fund, Inc.
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(Name of Registrant as Specified in Its Charter)
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(Name of Person(s) Filing Proxy Statement if other than the Registrant)
<PAGE>
THE HERZFELD CARIBBEAN BASIN FUND, INC.
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NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
NOVEMBER 16, 1999
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Miami, Florida
August 31, 1999
TO THE SHAREHOLDERS OF
THE HERZFELD CARIBBEAN BASIN FUND, INC.:
The Annual Meeting of Shareholders of The Herzfeld Caribbean Basin Fund,
Inc. (the "Fund") will be held on November 16, 1999 at 2:00 p.m., at the offices
of Kaufman, Rossin & Co., Inc., 2699 S. Bayshore Drive, Miami, FL 33133, for the
following purposes:
(1) the election of two directors;
(2) to ratify or reject the selection of independent accountants made by
the Board of Directors for the year ending June 30, 2000;
(3) to transact such other business as may properly come before the
meeting and any adjournments thereof.
The subjects referred to above are discussed in detail in the Proxy
Statement attached to this notice. Each shareholder is invited to attend the
Annual Meeting of Shareholders in person. Shareholders of record at the close of
business on August 27, 1999 have the right to vote at the meeting. If you cannot
be present at the meeting, we urge you to fill in, sign, and promptly return the
enclosed proxy in order that the meeting can be held without additional expense
and a maximum number of shares may be voted.
CECILIA GONDOR-MORALES
Secretary
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YOUR VOTE IS IMPORTANT
NO MATTER HOW MANY SHARES YOU OWNED ON THE RECORD DATE.
PLEASE INDICATE YOUR VOTING INSTRUCTIONS ON THE ENCLOSED PROXY CARD, DATE,
SIGN AND RETURN IT IN THE ENVELOPE PROVIDED, WHICH IS ADDRESSED FOR YOUR
CONVENIENCE AND NEEDS NO POSTAGE IF MAILED IN THE UNITED STATES. IN ORDER TO
AVOID THE ADDITIONAL EXPENSE TO THE FUND OF FURTHER SOLICITION, WE ASK YOUR
COOPERATION IN MAILING YOUR PROXY PROMPTLY. THE PROXY IS REVOCABLE AT ANY TIME
PRIOR TO ITS USE.
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<PAGE>
IF YOU CANNOT ATTEND THE ANNUAL MEETING, IT IS REQUESTED THAT YOU COMPLETE AND
SIGN THE ENCLOSED PROXY AND RETURN IT IN THE ENVELOPE PROVIDED SO THAT THE
MEETING MAY BE HELD AND ACTION TAKEN ON THE MATTERS DESCRIBED HEREIN WITH THE
GREATEST POSSIBLE NUMBER OF SHARES PARTICIPATING.
<PAGE>
THE HERZFELD CARIBBEAN BASIN FUND, INC.
P.O. BOX 161465, MIAMI, FLORIDA 33116
PROXY STATEMENT
ANNUAL MEETING OF SHAREHOLDERS TO BE HELD
NOVEMBER 16, 1999
This statement is furnished in connection with the solicitation of proxies
by the Board of Directors of The Herzfeld Caribbean Basin Fund, Inc. (the
"Fund") for use at the Annual Meeting of Shareholders (the "Annual Meeting") to
be held at the offices of Kaufman, Rossin & Co., Inc., 2699 Bayshore Drive,
Miami, FL 33133 on November 16, 1999 at 2:00 p.m.
Proxies may be solicited by mail, telephone, telegraph and personal
interview. The Fund has also requested brokers, dealers, banks or voting
trustees, or their nominees to forward proxy material to the beneficial owners
of stock of record. The enclosed proxy is revocable by you at any time prior to
the exercise thereof by submitting a written notice of revocation or
subsequently executed proxy to the Secretary of the meeting. Signing and mailing
the proxy will not affect your right to give a later proxy or to attend the
meeting and vote your shares in person. The cost of soliciting proxies will be
paid by the Fund. This proxy statement is expected to be distributed to
shareholders on or about August 31, 1999.
THE PERSONS NAMED IN THE ACCOMPANYING PROXY WILL VOTE THE NUMBER OF SHARES
REPRESENTED THEREBY AS DIRECTED OR, IN THE ABSENCE OF SUCH DIRECTION, FOR EACH
OF THE NOMINEES FOR DIRECTOR, FOR THE RATIFICATION OF THE SELECTION OF THE
FUND'S INDEPENDENT ACCOUNTANTS AND TO TRANSACT SUCH OTHER BUSINESS THAT MAY
PROPERLY COME BEFORE THE MEETING AND ANY ADJOURNMENTS THEREOF.
On August 27, 1999, the date for determination of shareholders entitled to
receive notice of and to vote at the Annual Meeting, or any adjournment thereof,
there were issued and outstanding 1,677,636 shares of Common Stock of the Fund,
each entitled to one vote, constituting all of the Fund's then outstanding
securities.
At the Annual Meeting, a quorum shall consist of the holders of a majority
of the outstanding shares of the Common Stock of the Fund entitled to vote at
the meeting. If a quorum is present, a plurality of all votes cast at the Annual
Meeting shall be sufficient for the election of a director (Proposal 1). The
affirmative vote of more than 50% of the shares voted at the Annual Meeting,
assuming a quorum is present, is required for the ratification of the selection
of Kaufman, Rossin & Co. as independent accountants of the Fund (Proposal 2).
Under Maryland law, abstentions and broker non-votes will be included for
purposes of determining whether a quorum is present at the Annual Meeting, but
will be treated as votes not cast, and therefore, will not be counted for
purposes of determining whether matters to be voted upon at the Annual Meeting
have been approved.
<PAGE>
The Fund will furnish, without charge, a copy of its annual report for its
fiscal year ended June 30, 1999 to any shareholder requesting such report.
Requests for the annual report should be made in writing to the Fund at the
address set forth above or by calling the Fund at 800-854-3863, or for Florida
residents, 800-718-3863 or 305-271-1900.
ELECTION OF DIRECTORS
(Proposal 1)
Two directors are to be elected at the Annual Meeting. Pursuant to the
Fund's By-Laws, the directors are classified into three classes with respect to
the year of expiration of their terms of office. Because the Fund's Class III
directors' initial terms of office will expire in 1999, the Annual Meeting is
being held for the election of those directors. The Class I and Class II
directors' terms of office will expire in 2000 and 2001, respectively.
If authority is granted on the accompanying proxy to vote in the election
of directors, it is the intention of the persons named in the proxy to vote at
the Annual Meeting for the election of the nominees named below, each of whom
has consented to being named in the proxy statement and to serve if elected. If
any of the nominees is unavailable to serve for any reason, the persons named as
proxies will vote for such other nominee or nominees selected by the Board of
Directors, or the Board may reduce the number of directors as provided in the
Fund's By-Laws. The Fund currently knows of no reasons why either of the
nominees listed below would be unable or unwilling to serve if elected.
As of August 31, 1999, the Fund's Board of Directors consisted of five
members. Mr. Ted S. Williams resigned from the Board as of October 5, 1998. On
October 20, 1998, the Board changed the number of directors from six to five
persons. The Class III directors of the Fund, Mr. Thomas J. Herzfeld and Ms.
Cecilia Gondor-Morales, are both nominees for election, and their current terms
as directors will expire on the date of the Annual Meeting or when their
successors are elected and qualify. The Board intends to redesignate Ms.
Gondor-Morales as a Class II director; therefore, if elected, she will serve a
two year term as director. Mr. Herzfeld will continue to be a Class III director
and would serve a three year term. Each of the nominees would serve until their
successors have been elected and qualified.
Certain information regarding each of the nominees as well as the current
directors and executive officers of the Fund is set forth below.
Nominees for Directors
<TABLE>
<CAPTION>
Year First Shares Owned Percent Owned
Name and Position Principal Occupation Became Beneficially Beneficially
with Fund for Past 5 Years Age Director August 27, 1999 August 27, 1999
--------- ---------------- --- -------- --------------- ---------------
<S> <C> <C> <C> <C> <C>
Thomas J. Herzfeld Chairman and President of 54 1993 15,000 .89%
President and Thomas J. Herzfeld & Co., Inc.
Director and Thomas J. Herzfeld
Advisors, Inc.
Cecilia Gondor-Morales Executive Vice President of 37 1993 1,400 .08%
Director, Treasurer & Thomas J. Herzfeld & Co., Inc.
Secretary and Thomas J. Herzfeld
Advisors, Inc.
</TABLE>
<PAGE>
Directors and Officers
<TABLE>
<CAPTION>
Shares Owned Percent Owned
Name and Position Position Principal Occupation Beneficially Beneficially
with Fund Age Since for Past 5 Years August 27, 1999 August 27, 1999
--------- --- ----- ---------------- --------------- ---------------
<S> <C> <C> <C> <C> <C>
Thomas J. Herzfeld* 54 1993 See "Nominees for Directors" 15,000 .89%
President & Director above
Cecilia Gondor- 37 1993 See "Nominees for Directors" 1,400 .08%
Morales* above
Director, Treasurer &
Secretary
Bergthor F. Endresen 78 1993 Consultant and former 5,505 .33%
Director Chairman of Aerotech World
Trade Corp.
Ann S. Lieff 47 1998 Consultant to Camelot 0 0
Director Music; President and
CEO of Spec's Music
Inc. until July 29, 1998
Kenneth A.B. Trippe 66 1993 Chairman of Cruise Brokers, 2,000 .12%
Director Inc., and Trippe & Company
Inc.
</TABLE>
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* An "interested person" (as defined in the Investment Company Act of 1940) of
the Fund because he/she is an officer and employee of the Fund's investment
adviser.
The Board of Directors of the Fund held four regular meetings and one
special meeting during the Fund's fiscal year ended June 30, 1999. Each of the
directors attended at least 75% of the aggregate number of meetings of the Board
of Directors and of each committee of which he was a member. The Audit Committee
of the Board currently consists of Messrs. Endresen, and Trippe, and Ms. Lieff,
none of whom is an "interested person" of the Fund. The Audit Committee reviews
the scope of the audit by the Fund's independent accountants, confers with the
accountants with respect to the audit and the internal accounting controls of
the Fund and with respect to such other matters as may be important to an
evaluation of the audit and the financial statements of the Fund, and makes
recommendations with respect to the selection of accountants for the Fund. The
Audit Committee met once during the fiscal year ended June 30, 1999. The Board
does not have a nominating or compensation committee. The Fund pays those
directors who are not "interested persons" of the Fund $1,000 per year in
addition to $400 for each meeting of the Board attended, plus reimbursement for
expenses. Such fees totaled $8,700 for the fiscal year ended June 30, 1999.
As of August 27, 1999, directors and executive officers beneficially owned
an aggregate 1.42% of the Fund's outstanding shares on that date.
The aggregate compensation paid by the Fund to each of its directors
serving during the fiscal year ended June 30, 1999 is set forth in the
compensation table below. Mr. Herzfeld and Ms. Gondor-Morales receive no direct
compensation for their services on the Fund's Board.
<PAGE>
<TABLE>
<CAPTION>
Total Compensation
Aggregate Pension or Retirement From Fund and Fund
Name of Person and Compensation Benefits Accrued Complex Paid to
Position with Fund from the Fund as Part of Fund Expenses Directors
- ------------------ ------------- ------------------------ ---------
<S> <C> <C> <C>
Thomas J. Herzfeld* $0 $0 $0
President and Director
Cecilia Gondor-Morales* $0 $0 $0
Director, Treasurer & Secretary
Ted S. Williams* $0 $0 $0
Director (until 10/5/98)
Bergthor F. Endresen $2,600 $0 $2,600
Director
Ann S. Lieff $2,600 $0 $2,600
Director
Kenneth A.B. Trippe $3,400 $0 $3,400
Director
</TABLE>
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*"Interested person" of the Fund as defined by Section 2(a)(19) of the
Investment Company Act of 1940.
THE BOARD OF DIRECTORS RECOMMENDS THAT THE FUND'S SHAREHOLDERS VOTE "FOR"
THE ELECTION OF EACH OF THE NOMINEES FOR DIRECTOR.
RATIFICATION OR REJECTION OF APPOINTMENT OF
INDEPENDENT ACCOUNTANTS
(Proposal 2)
Kaufman, Rossin & Co., 2699 South Bayshore Drive, Miami, Florida 33133,
independent accountants for the Fund, has examined the Fund's financial
statements for the fiscal year ended June 30, 1999, and in connection therewith
has reported on the financial statements of the Fund, prepared the Fund's tax
returns and reviewed certain filings of the Fund with the Securities and
Exchange Commission. Kaufman, Rossin & Co. has not performed any other services
for the Fund. The Audit Committee of the Board of Directors met on November 4,
1998 and recommended the selection of Kaufman, Rossin & Co. as independent
accountants for the Fund for the fiscal year ending June 30, 2000. At a meeting
held on July 13, 1999, the Board of Directors, including a majority of those
directors who are not "interested persons" of the Fund, after considering the
recommendation of the Audit Committee, selected Kaufman, Rossin & Co. to act as
independent accountants for the Fund for the year ending June 30, 2000. Under
the Investment Company Act of 1940, such selection must be submitted to
shareholders for ratification or rejection at the Annual Meeting.
A representative of Kaufman, Rossin & Co. will be present at the meeting
and will have the opportunity to respond to appropriate questions from
shareholders and to make such statements as desired.
THE BOARD OF DIRECTORS RECOMMENDS THAT THE FUND'S SHAREHOLDERS VOTE "FOR"
THE SELECTION OF KAUFMAN, ROSSIN & CO. AS THE FUND'S INDEPENDENT ACCOUNTANTS.
<PAGE>
ADDITIONAL INFORMATION
HERZFELD/CUBA (the "Adviser"), a division of Thomas J. Herzfeld Advisors,
Inc., with offices at The Herzfeld Building, P.O. Box 161465, Miami, Florida
33116, serves as the Fund's investment adviser pursuant to an Investment
Advisory Contract dated June 24, 1993. The Adviser also provides certain
administration services to the Fund, but the Fund has no formal administrative
contract. Mr. Herzfeld and Ms. Gondor-Morales, directors of the Fund, are
executives of the Adviser.
Thomas J. Herzfeld & Co., Inc., P.O. Box 161465, Miami, Florida 33116,
acted as Underwriter to the Fund.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
As of August 15, 1999, there were no persons known by the Fund to own
beneficially more than 5% of the outstanding shares of the Fund.
SHAREHOLDER PROPOSALS
Proposals intended to be presented by shareholders for consideration at the
2000 Annual Meeting of Shareholders must be received by the Secretary of the
Fund no later than July 15, 2000 in order to be included in the proxy statement
for the meeting.
To submit a proposal, a shareholder must own 1% or $2,000 worth of shares
of the Fund for at least one year, and must own those shares through the date of
the 2000 Annual Meeting. Shareholders who qualify may submit only one proposal
per Annual Meeting, and the proposal may be no longer than 500 words.
REPORTS TO SHAREHOLDERS AND FINANCIAL STATEMENTS
The Annual Report to Shareholders of the Fund, including audited financial
statements of the Fund for the fiscal year ended June 30, 1999, is being mailed
to shareholders. The Annual Report should be read in conjunction with this Proxy
Statement, but is not part of the proxy soliciting material. A copy of the
Annual Report may be obtained from the Fund, without charge, by contacting the
Fund in writing at the address on the cover of this Proxy Statement, or by
calling 800-854-3863 (for Florida residents, 800-718-3863), or 305-271-1900.
<PAGE>
OPEN MATTERS
Management of the Fund does not know of any matters to be presented at the
Annual Meeting other than those mentioned in this Proxy Statement. If any other
business should come before the meeting, the proxies will vote thereon in
accordance with their best judgment.
By Order of the Directors,
Cecilia Gondor-Morales
Director, Treasurer & Secretary
The Herzfeld Caribbean Basin Fund, Inc.
Dated: August 31, 1999
