MANAGED HIGH INCOME PORTFOLIO INC.
388 Greenwich Street
New York, New York 10013
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NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
To Be Held on June 15, 2000
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To the Stockholders of
Managed High Income Portfolio Inc.:
Notice is hereby given that the Annual Meeting of Stockholders of Managed
High Income Portfolio Inc. (the "Fund") will be held in the Downtown Conference
Center on the mezzanine level at 7 World Trade Center, New York, New York, on
June 15, 2000 at 10:00 a.m. (New York time) for the following purposes:
1. To elect two Directors of the Fund (Proposal 1).
2. To ratify the selection of KPMG LLP as the independent auditors of the
Fund for the fiscal year ending February 28, 2001 (Proposal 2).
3. To consider and vote upon such other matters as may come before said
meeting or any adjournments thereof.
The close of business on April 19, 2000 has been fixed as the record date
for the determination of stockholders entitled to notice of and to vote at the
meeting and any adjournments thereof.
By Order of the Board of Directors,
Christina T. Sydor
May 18, 2000 Secretary
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YOUR VOTE IS IMPORTANT REGARDLESS OF THE SIZE OF YOUR HOLDINGS IN THE FUND.
WHETHER OR NOT YOU PLAN TO ATTEND THE MEETING, WE ASK THAT YOU PLEASE COMPLETE
AND SIGN THE ENCLOSED PROXY CARD AND RETURN IT PROMPTLY IN THE ENCLOSED ENVELOPE
WHICH NEEDS NO POSTAGE IF MAILED IN THE CONTINENTAL UNITED STATES.
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<PAGE>
INSTRUCTIONS FOR SIGNING PROXY CARDS
The following general rules for signing proxy cards may be of assistance
to you and avoid the time and expense to the Fund involved in validating your
vote if you fail to sign your proxy card properly.
1. Individual Accounts: Sign your name exactly as it appears in the
registration on the proxy card.
2. Joint Accounts: Either party may sign, but the name of the party
signing should conform exactly to a name shown in the registration.
3. All Other Accounts: The capacity of the individual signing the proxy
should be indicated unless it is reflected in the form of registration. For
example:
Registration Valid Signature
- ------------ ---------------
Corporate Accounts
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(1) ABC Corp. ................................. ABC Corp.
(2) ABC Corp. ................................ John Doe, Treasurer
(3) ABC Corp.
c/o John Doe, Treasurer ................. John Doe
(4) ABC Corp. Profit Sharing Plan ............. John Doe, Trustee
Trust Accounts
- --------------
(1) ABC Trust ................................. Jane B. Doe, Trustee
(2) Jane B. Doe, Trustee
u/t/d 12/28/78 ............................ Jane B. Doe
Custodian or Estate Accounts
- ----------------------------
(1) John B. Smith, Cust.
f/b/o John B. Smith, Jr. UGMA ............ John B. Smith
(2) Estate of John B. Smith ................... John B. Smith, Jr., Executor
<PAGE>
MANAGED HIGH INCOME PORTFOLIO INC.
388 Greenwich Street
New York, New York 10013
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ANNUAL MEETING OF STOCKHOLDERS
June 15, 2000
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PROXY STATEMENT
This Proxy Statement is furnished in connection with the solicitation of
proxies by the Board of Directors of Managed High Income Portfolio Inc. (the
"Fund") for use at the Annual Meeting of Stockholders of the Fund to be held in
the Downtown Conference Center on the mezzanine level at 7 World Trade Center,
New York, New York, on June 15, 2000, at 10:00 a.m. (New York Time) and at any
adjournments thereof (the "Meeting"). A Notice of Meeting of Stockholders and a
proxy card accompany this Proxy Statement. Proxy solicitations will be made
primarily by mail, but proxy solicitations also may be made by telephone,
telegraph or personal interviews conducted by officers of the Fund and officers
and regular employees of: Salomon Smith Barney Inc. ("Salomon Smith Barney"),
which makes a market in the Fund's shares ("Shares"); SSB Citi Fund Management
LLC., (successor to SSBC Fund Management Inc.) ("SSB Citi"), the Fund's
investment adviser and administrator; and PFPC Global Fund Services (the
"Transfer Agent"), the Fund's transfer agent. The costs of solicitation and the
expenses incurred in connection with preparing the Proxy Statement and its
enclosures will be paid by the Fund. The Fund will also reimburse brokerage
firms and others for their expenses in forwarding solicitation materials to the
beneficial owners of Shares. The Annual Report of the Fund, including audited
financial statements for the fiscal year ended February 29, 2000, has previously
been furnished to all stockholders of the Fund. This Proxy Statement is first
being mailed to stockholders on or about May 18, 2000. Additional copies of the
Annual Report are available without charge to any stockholder upon request by
calling 1-800-331-1710.
If the enclosed Proxy is properly executed and returned in time to be
voted at the Meeting, the Shares of common stock of the Fund represented thereby
will be voted in accordance with the instructions marked thereon. Unless
instructions to the contrary are marked thereon, a proxy will be voted FOR the
matters listed in the accompanying Notice of Annual Meeting of Stockholders. For
purposes of determining the presence of a quorum for transacting business at the
Meeting, abstentions and broker "non-votes" (that is, proxies from brokers or
nominees indicating that such persons have not received instructions from the
beneficial owner or other persons entitled to vote Shares on a particular matter
with respect to which the brokers or nominees do not have discretionary power)
will be treated as Shares that are present but which have not been voted. For
this reason, abstentions and broker "non-votes" will have no impact on the
requisite approval of the proposals. Any proxy may be revoked at any time prior
to the exercise thereof by submitting another proxy
<PAGE>
bearing a later date, by giving written notice to the Secretary of the Fund at
the Fund's address indicated on the prior page, or by voting in person at the
Meeting.
If a quorum is not present at the Meeting, or if a quorum is present but
sufficient votes to approve any of the proposals are not received, the persons
named as proxies may propose one or more adjournments of the Meeting to permit
further solicitation of proxies. In determining whether to adjourn the Meeting,
the following factors may be considered: the nature of the proposals that are
the subject of the Meeting; the percentage of votes actually cast; the
percentage of negative votes actually cast; the nature of any further
solicitation and the information to be provided to stockholders with respect to
the reasons for the solicitation. Any adjournment will require the affirmative
vote of a majority of the Shares represented at the Meeting in person or by
proxy. A stockholder vote may be taken on one of the proposals prior to such
adjournment if sufficient votes have been received and it is otherwise
appropriate. Any such adjournment will require the affirmative vote of a
majority of those Shares represented at the Meeting in person or by proxy. If a
quorum is present, the persons named as proxies will vote those proxies which
they are entitled to vote FOR any such proposal in favor of such an adjournment
and will vote those proxies required to be voted AGAINST any such proposal
against any such adjournment. Under the Fund's By-laws, a quorum is constituted
by the presence in person or by proxy of the holders of a majority of the
outstanding Shares entitled to vote at the Meeting.
The close of business on April 19, 2000 has been fixed as the record date
for the determination of stockholders entitled to notice of and to vote at the
Meeting and any adjournments thereof.
The Fund has one class of common stock, par value of $0.001 per Share. On
April 19, 2000, there were 43,285,107 Shares outstanding. Each stockholder is
entitled to one vote for each full Share and a proportionate fraction of a vote
for each fractional Share held.
As of April 19, 2000, Cede & Co., a nominee partnership of Depository
Trust Company, held 42,460,835 or 98.1% of the Shares outstanding.
As of the close of business on April 19, 2000, no other person (including
any "group" as that term is used in Section 13(d) of the Securities Exchange Act
of 1934 (the "Exchange Act")) to the knowledge of the Board of Directors owned
beneficially more than 5% of the outstanding shares of the Fund. As of the
record date, the Fund's officers and Directors owned beneficially less than 1%
of the outstanding Shares.
Proposal 1 requires for approval the affirmative vote of a plurality of
the votes cast at the Meeting in person or by proxy by the stockholders of the
Fund voting on the matter. Proposal 2 requires for approval the affirmative vote
of a majority of the votes cast at the Meeting in person or by proxy by the
stockholders of the Fund voting on the matter.
2
<PAGE>
PROPOSAL 1: ELECTION OF DIRECTORS
The Fund's Board is divided into three classes with the term of office
expiring each year. It is proposed that stockholders of the Fund elect two Class
II Directors of the Fund, each to serve for a three-year term and until his
respective successor is duly elected and qualified. The Class II Directors'
terms shall expire in 2003.
Each of the nominees, currently serves as a Director of the
Fund and has indicated that he will continue to serve if elected. However,
if either nominee should be unable to serve, the proxy confers discretionary
power on the persons named therein to vote in favor of a substitute nominee
or nominees. In order to fill a Class II Director vacancy that had resulted
from the resignation of Andrea Farace as of December 1, 1999, the Fund's
Board recently elected Mr. Robert A. Frankel to fill the unexpired term of
Mr. Farace and approved Mr. Frankel's nomination as a Class II Director to be
submitted to stockholders as part of this proxy.
Set forth below are the names of the two nominees for election to the
Fund's Board of Directors, together with certain other information:
Number (and
Percentage) of
Shares
Shares
Name, Age, Principal Occupation and Beneficially
Other Business Experience for the Director Owned* as of
Past Five Years Since Class April 19, 2000
- --------------------------------------------------------------------------------
Paolo M. Cucchi, age 58 .............. 1993 II 500(a)
Dean of College of Liberal Arts at
Drew University. Director of one
investment company managed by
affiliates of Salomon Smith Barney.
Robert A. Frankel, age 72 ............ 2000 II None
Managing Partner of Robert A.
Frankel Management Consultants;
formerly Corporate Vice President
of the Reader's Association Inc.
Director of ten investment companies
managed by affiliates of Salomon
Smith Barney.
- ----------
(a) Includes Shares owned by Director's family.
* For this purpose, "beneficial ownership" is defined under Section 13(d) of
the Exchange Act. The information as to beneficial ownership is based upon
information furnished to the Fund by the Directors.
The remainder of the Board is composed of the Class III and Class I
Directors (as indicated by the numbers III or I), none of whom will stand for
election at the Meeting, as their terms will expire in 2001 and 2002,
respectively.
3
<PAGE>
Number (and
Percentage) of
Shares
Name, Age, Principal Occupation and Beneficially
Other Business Experience for the Director Owned* as of
Past Five Years Since Class April 19, 2000
- --------------------------------------------------------------------------------
**Heath B. McLendon, age 66 .......... 1993 III 1025.3807(a)
Managing Director of Salomon Smith (less than 1%)
Barney; Chairman or Co-Chairman of
seventy-one investment companies
managed by affiliates of Citigroup
Inc. ("Citigroup"); President and
Director of SSB Citi and Travelers
Investment Advisers, Inc. ("TIA"):
formerly Chairman of the Board of
Smith Barney Strategy Advisers Inc.
Dr. Paul M. Hardin, age 68 ........... 1993 I 657.212(a)
Chancellor Emeritus and Professor
of Law at the University of North
Carolina at Chapel Hill and a
Director of The Summit
Bancorporation. Director of
fourteen investment companies
managed by affiliates of Salomon
Smith Barney. Formerly, Chancellor
of the University of North Carolina
at Chapel Hill
George M. Pavia, age 72 .............. 1993 I None
Senior Partner, Pavia & Harcourt,
Attorneys. Director of two
investment companies managed by
affiliates of Salomon Smith Barney.
- ----------
(a) Includes Shares owned by Director's family.
* For this purpose, "beneficial ownership" is defined under Section 13(d) of
the Exchange Act. The information as to beneficial ownership is based upon
information furnished to the Fund by the Directors.
** Interested person of the Fund as defined in the Investment Company Act of
1940, as amended, (the "1940 Act").
Section 16(a) of the Exchange Act requires officers and directors of the
Fund, and persons who own beneficially more than 10% of the Shares, to file
reports of ownership with the Securities and Exchange Commission, the New York
Stock Exchange, and the Fund. Based solely upon the review of such reports
received by the Fund and written representations of certain persons for whom
reports were filed, the Fund believes that during its fiscal year ended February
29, 2000, all filing requirements with respect to Section 16(a) fo the Exchange
Act were satisfied.
4
<PAGE>
The names of the principal officers of the Fund are listed in the table
below together with certain additional information. Each officer will hold the
office opposite his or her name until a successor is voted upon by the Board of
Directors.
Principal Occupations and Other
Position Affiliations for the
Name (Year First Elected) Past Five Years
- ---- -------------------- -------------------------------
Heath B. McLendon, Chief Executive (See table of directors)
age 66 .......... Officer (1993).
Chairman of the
Board (1993) and
President (1997)
John C. Bianchi, Vice President Managing Director of Salomon
age 44 .......... and Investment Smith Barney.
Officer (1993)
Lewis E. Daidone, Senior Vice Managing Director of Salomon
age 42 .......... President and Smith Barney, Senior Vice
Treasurer (1994) President and Treasurer
(Chief Financial Officer) of
the Salomon Smith Barney
mutual funds, and Director
and Senior Vice President of
SSB Citi and TIA.
Christina T. Sydor, Secretary (1994) Managing Director of Salomon
age 49 .......... Smith Barney, General
Counsel and Secretary of
SSB Citi and TIA.
The principal business address of each of the principal officers of the
Fund is 388 Greenwich Street, New York, New York 10013, except for Heath
McLendon, whose address is 7 World Trade Center, New York, New York 10048.
No officer, director, or employee of the Fund's investment adviser or
administrator receives any compensation from the Fund for serving as an officer
or director of the Fund. The Fund pays each Director who is not a director,
officer or employee of the Fund's investment adviser or administrator, a fee of
$5,000 per year plus $500 per regular in-person meeting attended and $100 per
telephone meeting attended. The Fund pays its Directors Emeritus a fee of $2,500
per year plus $250 per regular in-person meeting attended and $50 per telephone
meeting attended. The Fund also reimburses each Director for actual
out-of-pocket expenses relating to attendance at meetings. The aggregate
compensation paid by the Fund to such Directors (including reimbursement for
travel and out-of-pocket expenses) during the fiscal year ended February 29,
2000 amounted to $6,103.
5
<PAGE>
The following table shows the compensation paid by the Fund to each
Director during the Fund's last fiscal year and by the fund complex to each
Director during the last calendar year.
Compensation Table
<TABLE>
<CAPTION>
Pension or Total Number of Funds
Aggregate Retirement Compensation for Which Director
Name of Compensation Benefits from Fund Serves or Served
Director from Fund+ Accrued as Part Complex as a Board Member
of Fund
within
Expenses Fund Complex
- -------- ----------------- ---------------- ------------------- -------------------
<S> <C> <C> <C> <C>
Paolo M. Cucchi $7,700 $0 $19,150 1
++Alessandro di
Montezemolo 2,475 0 10,613 2
*Andrea Farace 5,350 0 16,100 1
Dr. Paul M. Hardin 7,700 0 139,583 14
**Heath B. McLendon 0 0 0 71
George M. Pavia 7,100 0 17,900 2
- ----------
</TABLE>
* Andrea Farace resigned as Director of the Fund as of December 1, 1999.
** Designates a Director who is an interested person of the Fund as defined
in the 1940 Act.
+ Upon attainment of age 80, Directors are required to change to emeritus
status. Directors Emeritus are entitled to serve in emeritus status for a
maximum of 10 years during which time they are paid 50% of the annual
retainer fee and meeting fees otherwise applicable to Directors, together
with reasonable out-of-pocket expenses for each meeting attended. During
the Fund's last fiscal year, aggregate compensation paid by the Fund to
Directors Emeritus totaled $5,500.
++ Attained Director Emeritus status on July 1, 1999.
During the fiscal year ended February 29, 2000, the Directors met six
times;
in addition two Audit Committee meetings were held. The Fund's Audit Committee
is comprised of those Directors who are not "interested persons" of the Fund as
defined in the 1940 Act ("Independent Directors"). The Audit Committee is
responsible for recommending the selection of the Fund's independent accountants
and reviewing all audit as well as non-audit accounting services performed for
the Fund. In the last fiscal year, no Director attended less than 75% of the
meetings of the Board and Audit Committee.
Required Vote
Election of each of the listed nominees for Director requires the
affirmative vote of a plurality of the votes cast at the Meeting in person or by
proxy.
THE BOARD OF DIRECTORS, INCLUDING ALL OF THE "INDEPENDENT" DIRECTORS,
RECOMMENDS THAT THE STOCKHOLDERS VOTE "FOR" THE ELECTION OF THE NOMINEES TO THE
BOARD.
6
<PAGE>
PROPOSAL 2: RATIFICATION OF THE SELECTION OF INDEPENDENT AUDITORS
The second proposal to be considered at the Meeting is the ratification of
the selection of KPMG LLP ("KPMG") as the independent public auditors for the
Fund for its fiscal year ending February 28, 2001.
On February 9, 2000, based upon the recommendation of the Audit Committee,
the Board of Directors, including a majority of the Independent Directors,
selected KPMG as the Fund's independent auditors for and during the fiscal year
ending February 28, 2001 subject to ratification by the Fund's stockholders at
the Meeting. KPMG also serves as independent auditor for SSB Citi, other
investment companies managed by affiliates of Salomon Smith Barney and for SSB
Citi's ultimate parent corporation, Citigroup. KPMG has no direct or material
indirect financial interest in the Fund, SSB Citi, Citigroup or any other
investment company sponsored by Salomon Smith Barney or its affiliates.
If the Fund receives a written request from any Fund stockholder at least
five days prior to the Meeting stating that the stockholder will be present in
person at the Meeting and desires to ask questions of KPMG concerning the Fund's
financial statements, a representative of KPMG will be present at the meeting,
will have the opportunity to make a statement, and will be available to respond
to appropriate questions.
Required Vote
Ratification of the selection of KPMG as independent auditors requires the
affirmative vote of a majority of the votes cast at the Meeting in person or by
proxy.
THE BOARD OF DIRECTORS, INCLUDING ALL OF THE "INDEPENDENT" DIRECTORS,
RECOMMENDS THAT STOCKHOLDERS VOTE "FOR" RATIFICATION OF THE SELECTION OF KPMG.
OTHER MATTERS TO COME BEFORE THE MEETING
The Directors do not intend to present any other business at the Meeting,
nor are they aware that any stockholder intends to do so. If, however, any other
matters are properly brought before the Meeting, the persons named in the
accompanying form of proxy will vote thereon in accordance with their judgment.
REQUEST FOR SPECIAL MEETINGS
Stockholders entitled to cast at least 25% of all votes entitled to be
cast at a meeting may require the calling of a meeting of stockholders for the
purpose of voting on the removal of any Director. Meetings of stockholders for
any other purpose shall be called by the Chairman of the Board, or the President
or Secretary of the Fund when requested in writing by stockholders entitled to
cast at least 25% of all votes entitled to be cast at the Meeting.
7
<PAGE>
SUBMISSION OF STOCKHOLDER PROPOSALS
Proposals that stockholders wish to include in the Fund's proxy statement
for the Fund's next Annual Meeting of Stockholders must be sent to and received
by the Fund no later than January 16, 2001. The submission by a stockholder of a
proposal for inclusion in the proxy statement does not guarantee that it will be
included. Stockholder proposals are subject to certain regulations under the
federal securities laws.
The persons named as proxies for the Annual Meeting of Stockholders for
2001 will have discretionary authority to vote on any matter presented by a
stockholder for action at that meeting unless the Fund receives notice of the
matter by March 17, 2001, in which case these persons will not have
discretionary voting authority except as provided in the Securities and Exchange
Commission's rules governing stockholder proposals.
By Order of the Board of Directors,
Christina T. Sydor
May 18, 2000 Secretary
IT IS IMPORTANT THAT PROXIES BE RETURNED PROMPTLY. STOCKHOLDERS WHO DO NOT
EXPECT TO ATTEND THE MEETING ARE THEREFORE URGED TO COMPLETE, SIGN, DATE AND
RETURN THE PROXY CARD AS SOON AS POSSIBLE IN THE ENCLOSED POSTAGE-PAID ENVELOPE.
