Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of
1934
Filed by the Registrant [X]
Filed by a party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary proxy statement
[ X ] Definitive proxy statement
[ ] Definitive additional materials
[ ] Soliciting material pursuant to Rule 14a-11(c) or Rule 14a-12
High Income Opportunity Fund Inc.
(Name of Registrant as Specified in its Charter)
Gordon Swartz
Name of Person Filing Proxy Statement
Payment of Filing Fee (Check appropriate box):
[X] No longer applicable
[ ] $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 the transaction applies:
(2) Aggregate number of securities to which transactions applies:
(3) Per unit price or other underlying value of transaction computed pursuant
to Exchange Act Rule 0-11:1
(4) Proposed maximum aggregate value of transaction:
[ ] 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:
(2) Form, schedule or registration statement no.:
(3) Filing party:
(4) Date filed:
1. Set forth the amount on which the filing fee is calculated and state how
it was determined.
<PAGE>
HIGH INCOME OPPORTUNITY FUND INC.
388 Greenwich Street
New York, New York 10013
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
----------------------
To be Held on February 23, 2000
----------------------
To the Stockholders of High Income Opportunity Fund Inc.:
The Annual Meeting of Stockholders of High Income Opportunity Fund Inc. (the
"Fund") will be held at the Fund's offices at 388 Greenwich Street, New York,
New York, 26th Floor, on February 23, 2000 at 9:00 A.M. (New York Time) for
the following purposes:
1. To elect three Class II directors, each to hold office for the term
indicated and until his or her successor shall have been elected and
qualified;
2. To ratify the selection of KPMG LLP as independent auditors of the
Fund; and
3. To transact such other business as may properly come before the
meeting or any adjournments thereof.
The Board of Directors has fixed the close of business on January 7, 2000 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
Secretary
New York, New York
January 26, 2000
----------------------
IT IS IMPORTANT THAT YOUR SHARES BE REPRESENTED AT THE MEETING IN PERSON OR
BY PROXY; IF YOU DO NOT EXPECT TO ATTEND THE MEETING, PLEASE COMPLETE, DATE,
SIGN AND RETURN THE ENCLOSED PROXY IN THE ACCOMPANYING ENVELOPE PROVIDED FOR
YOUR CONVENIENCE, WHICH REQUIRES NO POSTAGE IF MAILED IN THE UNITED STATES.
<PAGE>
HIGH INCOME OPPORTUNITY FUND INC.
388 Greenwich Street
New York, New York 10013
----------------------
PROXY STATEMENT
----------------------
FOR THE ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON FEBRUARY 23, 2000
INTRODUCTION
This proxy statement is furnished in connection with the solicitation by the
Board of Directors (the "Board") of the High Income Opportunity Fund Inc. (the
"Fund") of proxies to be voted at the Annual Meeting of Stockholders (the
"Meeting") of the Fund to be held at the Fund's principal executive offices at
388 Greenwich Street, 22nd Floor, New York, New York 10013, on February 23,
2000 at 9:00 A.M. (New York Time), and at any adjournments thereof, for the
purposes set forth in the accompanying Notice of Annual Meeting of
Stockholders (the "Notice").
The cost of soliciting proxies will be borne by the Fund. Proxy
solicitations will be made mainly by mail. In addition, certain officers,
directors and employees of the Fund; Salomon Smith Barney Inc. ("Salomon Smith
Barney"), which makes a market in the Fund's shares; SSB Citi Fund Management
LLC ("SSB Citi" or the "Manager") (successor to SSBC Fund Management Inc.),
the Fund's investment manager; and/or PFPC Global Fund Services (PFPC), the
Fund's transfer agent, may solicit proxies in person or by telephone,
telegraph, or mail. Salomon Smith Barney and SSB Citi are each located at 388
Greenwich Street, New York, New York 10013; PFPC is located at 101 Federal
Street, Boston, Massachusetts 02110.
The Annual Report of the Fund, including audited financial statements for
the fiscal year ended September 30, 1999, has previously been furnished to all
stockholders of the Fund. This proxy statement and form of proxy are first
being mailed to stockholders on or about January 26, 2000. The Fund will
provide additional copies of the Annual Report to any stockholder upon request
by calling the Fund at 1-800-331-1710.
All properly executed proxies received prior to the Meeting will be voted at
the Meeting in accordance with the instructions marked thereon or otherwise as
provided therein. Unless instructions to the contrary are marked, shares
represented by the proxies will be voted "FOR" all the proposals. For purposes
of determining the presence of a quorum for transacting business at the
Meeting, abstentions and
<PAGE>
broker "non-votes" (i.e. 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. Because the requisite
approval of both proposals is measured by a portion of the votes actually
cast, abstentions and broker "non-votes" will have no impact on the approval
of a proposal. Proposal 1 requires for approval the affirmative vote of a
majority of the votes cast at the Meeting with a quorum present. Proposal 2
requires for approval the affirmative vote of a majority of the votes cast at
the Meeting with a quorum present. Any proxy may be revoked at any time prior
to the exercise thereof by submitting another proxy bearing a later date, by
giving written notice to the Secretary of the Fund at the Fund's address
indicated above, or by voting in person at the Meeting.
The Board knows of no business other than that specifically mentioned in the
Notice to be presented for consideration at the Meeting. If any other matters
are properly presented, it is the intention of the persons named in the
enclosed proxy to vote in accordance with their best judgment to the extent
permissible under applicable law.
The Board of Directors of the Fund has fixed the close of business on
January 7, 2000 as the record date (the "Record Date") for the determination
of stockholders of the Fund entitled to notice of and to vote at the Meeting
or any adjournment thereof. Stockholders of the Fund on that date will be
entitled to one vote on each matter for each share held, and a fractional vote
with respect to fractional shares, with no cumulative voting rights. At the
Record Date, the Fund had outstanding 71,180,444.009 shares of Common Stock,
par value $.001 per share, the only authorized class of stock, of which
69,782,180.891 or 98.04% were held in accounts, but not beneficially owned, by
CEDE & Co., as nominee for The Depository Trust Company, Box 20, Bowling Green
Station, New York, New York 10004-9998. At the Record Date, no other person
(including any "group" as that term is used in Section 13(d) of the Securities
Exchange Act of 1934) to the knowledge of the Board or the Fund, owned
beneficially more than 5% of the outstanding shares of the Fund. As of the
Record Date, the officers and Board members of the Fund in the aggregate
beneficially owned less than 1% of the outstanding shares of the Fund.
In the event that a quorum is not present, or if sufficient votes in favor
of the proposals set forth in the Notice and this Proxy Statement are not
received by the time scheduled for the Meeting, the persons named as proxies
may move for one or more adjournments of the Meeting to permit further
solicitation of proxies with respect to any such proposals. 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
2
<PAGE>
provided to stockholders with respect to the reasons for the solicitation. Any
such adjournment will require the affirmative vote of a majority of the shares
present at the Meeting. The persons named as proxies will vote in favor of
such adjournment those shares which they are entitled to vote and which have
voted in favor of such proposals.
PROPOSAL NO. 1
ELECTION OF DIRECTORS
The Board of Directors of the Fund is currently classified into three
classes. The directors serving in Class II have terms expiring at the Meeting;
the Class II directors currently serving on the board have been nominated by
the Board of Directors for re-election at the Meeting to serve for a term of
three years (until the 2003 Annual Meeting of Stockholders) or until their
successors have been duly elected and qualified. The affirmative vote of a
majority of the votes cast at the Meeting at which a quorum is present is
sufficient to elect each nominee. It is the intention of the persons named in
the enclosed proxy to vote in favor of the election of the persons listed
below as nominees.
The Board knows of no reason why any of the Class II nominees listed below
will be unable to serve, but in the event of any such unavailability, the
proxies received will be voted for such substitute nominees as the Board may
recommend.
Certain information concerning the nominees is set forth below. All of the
nominees for Class II currently serve as directors of other Smith Barney
mutual funds. Any director affiliated with the Manager or otherwise considered
an "interested person" of the Fund, as defined in the Investment Company Act
of 1940, as amended (the "1940 Act") is indicated by an asterisk(*).
Persons Nominated for Election as Directors
<TABLE>
<CAPTION>
Number of Shares
Principal Occupations and % Beneficially
During Past Five Years, owned as of
Name Other Directorships, and Age January 7, 2000
---- ---------------------------- ------------------
<C> <S> <C>
CLASS II DIRECTORS
Heath B. McLendon* Managing Director of Salomon Smith 182.2247
Director since 1993 Barney; Director of 64 investment (less than 1%)
companies associated with Citigroup
Inc. ("Citigroup"); Director and
President of SSB Citi and Travelers
Investment Adviser, Inc.
("TIA"); 66.
Roderick C. Rasmussen Investment Counselor; Director of 132.7337
Director since 1993 12 investment companies associated (less than 1%)
with Citigroup. Formerly Vice
President of Dresdner and Company
Inc. (investment counselors); 73.
</TABLE>
3
<PAGE>
<TABLE>
<CAPTION>
Number of Shares
Principal Occupations and % Beneficially
During Past Five Years, owned as of
Name Other Directorships, and Age January 7, 2000
---- ---------------------------- ------------------
<C> <S> <C>
John P. Toolan Retired; Director of 12 investment None
Director since 1993 companies associated with
Citigroup; Director of John
Hancock Funds. Formerly Director
and Chairman of the Smith Barney
Trust Company, Director of Smith
Barney Holdings Inc. and various
subsidiaries, Senior Executive
Vice President, Director and
Member of the Executive Committee
of Smith Barney; 69.
The remainder of the Board currently constitutes the Class I and the Class
III directors, none of whom will stand for election at the Meeting, as their
terms are not due to expire until the year 2002 and 2001, respectively.
Directors Continuing in Office
<CAPTION>
Number of Shares
Principal Occupations and % Beneficially
During Past Five Years, owned as of
Name Other Directorships, and Age January 7, 2000
---- ---------------------------- ------------------
<C> <S> <C>
CLASS I DIRECTORS
Lee Abraham Retired; Director of 12 investment None
Director since 1999 companies associated with
Citigroup. Director of R.G. Barry
Corp., a footwear manufacturer and
Signet Group plc, a specialty
retailer and eNote.com, Inc., a
computer hardware company.
Formerly Chairman and Chief
Executive Officer of Associated
Merchandising Corporation, a major
retail merchandising and sourcing
organization and formerly Director
of Galey & Lord and Liz Claiborne;
age 72.
Allan J. Bloostein President of Allan J. Bloostein None
Director since 1999 Associates,
a consulting firm; Director of 19
investment companies associated
with Citigroup; Director of CVS
Corporation, a drugstore chain,
and Taubman Centers Inc., a real
estate development company.
Retired Vice Chairman and Director
of The May Department Stores
Company; age 70.
Richard E. Hanson, Jr. Head of School, New Atlanta Jewish None
Director since 1999 Community High School, Atlanta,
Georgia; Director of 12 investment
companies associated with
Citigroup. Formerly Headmaster,
The Peck School, Morristown, New
Jersey; age 58.
CLASS III DIRECTORS
Jane F. Dasher Investment Officer of Korsant None
Director since 1999 Partners, a
family investment company;
Director of 12 investment
companies associated with
Citigroup. Prior to 1997, an
independent Financial Consultant;
age 50.
</TABLE>
4
<PAGE>
<TABLE>
<CAPTION>
Number of Shares
Principal Occupations and % Beneficially
During Past Five Years, owned as of
Name Other Directorships, and Age January 7, 2000
---- ---------------------------- ------------------
<C> <S> <C>
Donald R. Foley Retired; Director of 12 investment 11,080.645**
Director since 1993 companies associated with Citigroup. (less than 1%)
Formerly Vice President of Edwin
Bird Wilson, Incorporated
(advertising); 77.
Paul Hardin Professor of Law at the University 3,045.760**
Director since 1994 of North (less than 1%)
Carolina at Chapel Hill; Director of
14 investment companies associated
with Citigroup; Director of The
Summit Bancorporation. Formerly,
Chancellor of the University of
North Carolina at Chapel Hill; 68.
- ------------------
</TABLE>
* Designates a Director who is an "interested person" of the Fund as defined
under the 1940 Act.
** Represents shares owned by this Director and members of his family.
Section 16(a) Beneficial Ownership Reporting Compliance
Section 16(a) of the Securities Exchange Act of 1934 requires the Fund's
officers and directors, and persons who beneficially own more than ten percent
of a registered class of the Fund's equity securities, to file reports of
ownership with the Securities and Exchange Commission, the New York Stock
Exchange and the Fund. Based solely upon its review of the copies of such
forms received by it and representations from such persons, the Fund believes
that, during fiscal year 1999, all filing requirements applicable to such
persons were complied with.
The Fund has no compensation committee of the Board of Directors or any
committee performing similar functions. The fund has an administrative and
governance committee composed of Lee Abraham, Donald R. Foley, Richard E.
Hanson, Jr. and Paul Hardin which acts as a nominating committee of the Board
of Directors. The Fund has an audit and investment performance committee
composed of Allan J. Bloostein, Jane F. Dasher, Roderick C. Rasmussen and John
P. Toolan, which is charged with recommending a firm of independent auditors
to the Fund and reviewing accounting matters with the auditors. The directors
of these respective committees are not "interested persons" of the Fund as
defined under the 1940 Act (the "independent directors").
Eight meetings of the Board were held between October 1, 1998 and September
30, 1999, four of which were regular meetings. Four administrative and
governance committee meetings were held. Two Audit Committee meetings were
also held. No incumbent director attended less than 75% of these meetings
since his/her election to the Board of Directors.
5
<PAGE>
Only the independent directors receive remuneration from the Fund for acting
as a director. Aggregate fees and expenses (including reimbursement for travel
and out-of-pocket expenses) of $16,595 were paid to such directors by the Fund
during the calendar year ended December 31, 1998. Fees for the independent
directors, who also serve as board members of certain other funds sponsored by
or affiliated with Salomon Smith Barney, are currently set at $60,000 per
annum plus a per meeting fee of $2,500 with respect to in-person meetings and
$100 for each telephone meeting. None of the officers of the Fund received any
compensation from the Fund for such period. Officers and interested directors
of the Fund are compensated by Salomon Smith Barney.
The following table shows the compensation paid to each person who was a
director of the Fund during the Fund's last fiscal year:
COMPENSATION TABLE
<TABLE>
<CAPTION>
Aggregate Compensation from
Compensation Fund and Fund Total
from Fund Pension or Complex Number of
for the Retirement Paid to Directors Funds for
Fiscal Year Benefits Accrued for the Calendar Which Director
Ended as part of Year Ended Serves Within
Name of Person 9/30/99 Fund Expenses 12/31/98 Fund Complex
-------------- ------------ ---------------- ----------------- --------------
<S> <C> <C> <C> <C>
Lee Abraham $439 0 $47,750 12
Allan J. Bloostein 339 0 90,500 19
Jane F. Dasher* 481 0 0 12
Donald R. Foley** 964 0 57,100 12
Richard E. Hanson, Jr. 427 0 47,950 12
Paul Hardin 964 0 71,400 14
Heath B. McLendon+ 0 0 0 64
Roderick C. Rasmussen 964 0 57,100 12
John P. Toolan** 864 0 54,700 12
</TABLE>
- -----------
* Ms. Dasher was not a director of the Smith Barney Funds in 1998, therefore
no compensation was paid by the Fund complex.
** Pursuant to the Fund's deferred compensation plan, the indicated Directors
have elected to defer the following amounts of their compensation from the
Fund: Donald R. Foley--$221; John P. Toolan--$864, and the following amounts
of their total compensation from the Fund Complex: Donald R. Foley--$21,000;
John P. Toolan--$54,700.
+ Designates a Director who is an "interested person" of the Fund as defined
under the 1940 Act.
Upon attainment of age 72 the Fund's current directors may elect to change to
emeritus status. Any directors elected or appointed to the Board of Directors
in the future will be required to change to emeritus status upon attainment of
age 80. 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 the Fund's directors, together
with reasonable out-of-pocket expenses for each meeting attended. During the
Fund's last fiscal year, total compensation paid by the Fund to Directors
Emeritus totalled $417.
6
<PAGE>
The following is a list of the current executive officers of the Fund, all
of whom have been elected by the directors to serve until their respective
successors are elected:
<TABLE>
<CAPTION>
Principal Occupations
Offices and Positions Period During Past Five Years
Name Held with Fund Offices Held and Age
---- --------------------- ------------ ----------------------
Heath B. McLendon Chairman of the 1995 to date (see table of directors
Board, President and above)
Chief Executive
Officer
<C> <C> <C> <S>
Lewis E. Daidone Senior Vice President 1993 to date Managing Director of
and Treasurer Salomon Smith Barney;
Senior Vice President
and Treasurer of 59
investment companies
associated with
Citigroup; Director and
Senior Vice President of
the Manager and TIA; 42.
John C. Bianchi Vice President 1993 to date Managing Director of
Salomon Smith Barney and
investment officer of
six investment companies
associated with
Citigroup; 44.
Christina T. Sydor Secretary 1993 to date Managing Director of
Salomon Smith Barney;
Secretary of 59
investment companies
associated with
Citigroup; Secretary and
General Counsel of the
Manager and TIA; 48.
Paul Brook Controller 1998 to date Director of Citigroup;
Controller or Assistant
Treasurer of 43
investment companies
associated with
Citigroup since 1998;
Prior to 1998, Managing
Director of AMT Capital
Services Inc.; Prior to
1997, Partner with Ernst
& Young LLP; 46
</TABLE>
THE BOARD OF DIRECTORS, INCLUDING ALL OF THE INDEPENDENT DIRECTORS,
RECOMMENDS THAT YOU VOTE "FOR" THE ELECTION OF NOMINEES TO THE BOARD.
PROPOSAL NO. 2
RATIFICATION OF SELECTION OF INDEPENDENT AUDITORS
On December 17, 1999, based upon the recommendation of the Audit Committee
of the Fund's Board of Directors, and in accordance with Section 32 of the
1940 Act and the rules thereunder, the Board and the independent directors
selected KPMG LLP ("KPMG") as the Fund's independent auditors for the fiscal
year ending September 30, 2000. KPMG also serves as the independent auditors
for the Manager, other investment companies associated with Salomon Smith
Barney and for Citigroup, as of December 31, 1999. Citigroup is the ultimate
parent company of both SSB Citi and Salomon Smith Barney. KPMG has no direct
7
<PAGE>
or material indirect financial interest in the Fund, the Manager, Citigroup,
or any other investment company sponsored by Salomon Smith Barney or its
affiliates.
If the Fund receives a written request from any 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 the auditors concerning
the Fund's financial statements, the Fund will arrange to have a
representative of KPMG present at the Meeting who will respond to appropriate
questions and have an opportunity to make a statement.
The affirmative vote of a majority of votes cast is required to ratify the
selection of KPMG.
THE BOARD OF DIRECTORS, INCLUDING ALL OF THE INDEPENDENT DIRECTORS,
RECOMMENDS THAT THE STOCKHOLDERS VOTE "FOR" THE RATIFICATION OF THE SELECTION
OF INDEPENDENT AUDITORS.
SUBMISSION OF STOCKHOLDER PROPOSALS
Stockholder proposals intended to be presented at the 2001 Annual Meeting of
the stockholders of the Fund must be received by September 22, 2000 to be
included in the proxy statement and the form of proxy relating to that
meeting, as the Fund expects that the 2001 Annual Meeting will be held in
January 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 2001 Annual Meeting of stockholders
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 December 8, 2000, 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.
OTHER MATTERS
The Manager knows of no other matters which are to be brought before the
Meeting. However, if any other matters not now known or determined properly
come before the Meeting, it is the intention of the persons named in the
enclosed form of proxy to vote such proxy in accordance with their judgment on
such matters.
By Order of the Board of Directors,
Christina T. Sydor
Secretary
January 26, 2000
8
FORM OF PROXY
HIGH INCOME OPPORTUNITY FUND INC.
388 Greenwich Street
New York, New York 10013
This Proxy is Solicited on Behalf of the Board of Directors of the
Fund
The undersigned hereby appoints HEATH B. McLENDON, CHRISTINA T.
SYDOR, and GORDON E. SWARTZ, and each of them acting in the
absence of the other, as Proxies, each with the power to appoint his
substitute, and hereby authorizes them to represent and to vote, as designated
herein, all the shares of common stock of High Income Opportunity Fund Inc.
held of record by the undersigned on January 7, 2000 at a Meeting of
Stockholders to be held on February 23, 2000 or any adjournment thereof.
[SEE REVERSE SIDE] CONTINUED AND TO BE SIGNED ON REVERSE SIDE [SEE REVERSE
SIDE]
[ X ] Please mark
votes as in
this example.
The Board of Directors recommends a vote "FOR" the following
proposals. This proxy, when properly executed, will be voted in the
manner directed herein by the undersigned stockholder. If no
direction is made, this proxy will be voted FOR each nominee for
director and FOR each proposal.
1. ELECTION OF DIRECTORS
Class II Nominees: (01) Heath B. McLendon, (02) Roderick C. Rasmussen,
(03) John P. Toolan
FOR WITHHELD
[ ] [ ]
[ ]
For all nominees except as noted above
2. PROPOSAL TO RATIFY THE SELECTION OF KPMG LLP AS THE INDEPENDENT
AUDITORS OF THE FUND FOR THE FISCAL YEAR ENDING SEPTEMBER 30, 2000.
FOR AGAINST ABSTAIN
[ ] [ ] [ ]
3. In their discretion, the Proxies are authorized to vote upon
such other business as may properly come before the meeting.
MARK HERE FOR ADDRESS CHANGE AND NOTE AT LEFT
[ ]
PLEASE MARK, SIGN DATE AND RETURN THE PROXY CARD PROMPTLY USING THE
ENCLOSED ENVELOPE.
Please sign exactly as name appears to the left. When shares
are held by joint tenants, both should sign, or if one signs, that
stockholder's vote binds both stockholders. When signing as attorney,
executor, administrator, agent, 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: ______________
g:/legal/funds/#HIO/2000/secdocs/proxycrd.doc
