SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSANT 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
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Section 240.14a-11(c) or Section 240.14a-12
TRI-CONTINENTAL CORPORATION
(Name of Registrant as Specified In Its Charter)
TRI-CONTINENTAL CORPORATION
(Name of Person(s) Filing Proxy Statement)
Payment of Filing Fee (Check the appropriate box):
[X] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(j)(2).
[ ] $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 transaction applies:
..............................................................
2) Aggregate number of securities to which transaction applies:
..............................................................
3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11*
4) Proposed maximum aggregate value of transaction:
..............................................................
- -----------
* Set forth the amount on which the filing fee is calculated and state how it
was determined.
[ ] 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:
..............................................................
Notes:
<PAGE>
====================================
TRI-CONTINENTAL
CORPORATION
NOTICE OF ANNUAL MEETING
OF STOCKHOLDERS
AND
PROXY STATEMENT
====================================
TIME: MAY 18, 1995
10:00 A.M.
====================================
PLACE: THE POWERHOUSE THEATER,
OF THE MILWAUKEE REPERTORY,
108 EAST WELLS STREET
MILWAUKEE, WISCONSIN 53202
=====================================
=====================================
PLEASE DATE, FILL IN AND SIGN THE
ENCLOSED FORM OF PROXY AND MAIL IT IN
THE ENCLOSED RETURN ENVELOPE WHICH
REQUIRES NO POSTAGE IF MAILED IN THE
UNITED STATES.
=====================================
[J. & W. SELIGMAN & CO. LOGO]
<PAGE>
TRI-CONTINENTAL CORPORATION
100 Park Avenue, New York, New York 10017
New York City Telephone (212) 850-1864
Toll-Free Telephone (800) 221-2450--continental United States,
including New York State
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON MAY 18, 1995
To the Stockholders:
The 65th Annual Meeting of Stockholders (the "Meeting") of Tri-Continental
Corporation, a Maryland corporation (the "Corporation"), will be held at the
Powerhouse Theater of the Milwaukee Repertory, 108 East Wells Street, Milwaukee,
Wisconsin 53202 on May 18, 1995 at 10:00 A.M., for the following purposes:
(1) To elect three Directors;
(2) To act on a proposal to ratify the selection of Deloitte & Touche LLP
as auditors of the Corporation for 1995; and
(3) To transact such other business as may properly come before the
Meeting or any adjournment thereof, including acting upon the four
stockholder proposals presented under the heading "Other Matters" in
the Proxy Statement accompanying this Notice, if those proposals are
brought before the Meeting;
all as set forth in the Proxy Statement accompanying this Notice.
The minute book of the Corporation will be available at the Meeting for
inspection by Stockholders.
The close of business on March 23, 1995 has been fixed as the record date
for the determination of Stockholders entitled to notice of, and to vote at, the
Meeting or any adjournment thereof.
By order of the Board of Directors,
/s/ Frank J. Nasta
Secretary
Dated: New York, New York, April 12, 1995
----------------------
YOUR VOTE IS IMPORTANT
NO MATTER HOW MANY SHARES YOU OWN
PLEASE INDICATE YOUR VOTING INSTRUCTIONS ON THE ENCLOSED PROXY CARD, DATE
AND SIGN IT, 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 OF FURTHER
SOLICITATION, WE ASK YOUR COOPERATION IN MAILING YOUR
PROXY PROMPTLY. A PROXY WILL NOT BE REQUIRED FOR
ADMISSION TO THE MEETING.
<PAGE>
April 12, 1995
TRI-CONTINENTAL CORPORATION
100 PARK AVENUE, NEW YORK, NEW YORK 10017
PROXY STATEMENT
FOR THE
ANNUAL MEETING OF STOCKHOLDERS TO BE HELD ON MAY 18, 1995
This Proxy Statement is furnished to you in connection with the
solicitation of Proxies by the Board of Directors of Tri-Continental Corporation
(the "Corporation") to be used at the 65th Annual Meeting of Stockholders (the
"Meeting") to be held in Milwaukee, Wisconsin on May 18, 1995.
If the accompanying form of Proxy is executed properly and returned, shares
represented by it will be voted at the Meeting. If you give instructions, your
shares will be voted in accordance with your instructions. If you give no
instructions and return your signed Proxy, your shares will be voted for the
election of three Directors, in accordance with the recommendation of your Board
of Directors as to all other proposals, and, at the discretion of the Proxy
holders, on any other matter that may properly have come before the Meeting or
any adjournment. You may revoke your Proxy or change it by written notice to the
Corporation (Attention: the Secretary) or by notice at the Meeting at any time
prior to the time it is voted.
The close of business on March 23, 1995 has been fixed as the record date
for the determination of Stockholders entitled to notice of, and to vote at, the
Meeting or any adjournment thereof. On that date, the Corporation had
outstanding 752,740 shares of $2.50 cumulative preferred stock (the "Preferred
Stock"), each share being entitled to two votes, and 84,327,381 shares of common
stock, par value $0.50 (the "Common Stock"), each share being entitled to one
vote. For all matters to be voted upon, an abstention or broker non-vote will
not be considered a vote cast.
The Corporation's investment advisor is J. & W. Seligman & Co. Incorporated
(the "Manager"). Subadvisory services are provided by Seligman Henderson Co. and
the Corporation's shareholder service agent is Seligman Data Corp. The address
of each of these entities is 100 Park Avenue, New York, NY 10017. The
Corporation will furnish, without charge, a copy of its most recent annual
report to any shareholder upon request to Seligman Data Corp. at 1-800-221-2450.
Questions or comments relating to any of the proposals set forth herein may be
directed to Morrow & Co., Inc., the Corporation's proxy solicitor, at
1-800-662-5200.
2
<PAGE>
It is expected that the Notice of Annual Meeting, Proxy Statement and form
of Proxy will first be mailed to Stockholders on or about April 12, 1995.
A. ELECTION OF DIRECTORS
------------------------
(Proposal 1)
There are thirteen Directors presently in office. The Board is currently
divided into three classes, and the members of each class hold office for a term
of three years unless elected in the interim. The term of one class expires in
each year.
At the Meeting this year, three Directors are to be elected. Dr. Alice
Stone Ilchman, whose term will expire at the 1995 Annual Meeting, and Mr. Frank
A. McPherson, replacing Mr. Douglas R. Nichols, Jr., who has elected to retire
at the 1995 Annual Meeting, have both been recommended by the Director
Nominating Committee of the Board of Directors of the Corporation for election
in the class whose term will expire in 1998. General John R. Galvin, replacing
Mr. Herman J. Schmidt, who has also elected to retire at the 1995 Annual
Meeting, has been recommended by the Director Nominating Committee for election
to the class whose term will expire at the 1997 Annual Meeting. Dr. Ilchman has
been a Director since 1990 and was last elected by Stockholders at the 1991
Annual Meeting.
Each nominee has agreed to serve if elected. There is no reason to believe
that Dr. Ilchman, Mr. McPherson or General Galvin will become unavailable for
election as a Director of the Corporation, but if that should occur before the
Meeting, Proxies will be voted for the persons the Board of Directors
recommends.
The background of Dr. Ilchman, Mr. McPherson and General Galvin and
information regarding the other Directors of the Corporation appears below.
3
<PAGE>
<TABLE>
<CAPTION>
PRINCIPAL OCCUPATION AND
OTHER INFORMATION
THE NOMINEES DESIGNATED
BY ASTERISK(*) ARE "INTERESTED SECURITIES
EXPIRATION PERSONS" OF THE CORPORATION (AS THAT BENEFICIALLY
NAME, PERIOD(S) OF TERM TERM IS DEFINED IN THE INVESTMENT OWNED, DIRECTLY OR
SERVED AS IF ELECTED COMPANY ACT OF 1940, AS AMENDED) INDIRECTLY, AS OF
DIRECTOR AND (AGE) AS A DIRECTOR BECAUSE OF THEIR STATED ASSOCIATIONS. MARCH 29, 1995
- ----------------------- ------------- -------------------------------------- ------------------
<S> <C> <C> <C>
Alice S. Ilchman 1998 PRESIDENT, SARAH LAWRENCE COLLEGE, 3,222 Common
1990 to Date BRONXVILLE, NY. Dr. Ilchman is a Shares
(59) Director or Trustee of each of the
Seligman Group investment
companies,+ NYNEX (formerly, New
York Telephone Company), The
[photo] Committee for Economic Development
and The Rockefeller Foundation;
formerly, Trustee of The Markle
Foundation and Director of
International Research & Exchange
Board.
Frank A. McPherson 1998 CHAIRMAN OF THE BOARD AND CHIEF EXE- 500 Common
(61) CUTIVE OFFICER, KERR-MCGEE CORPORA- Shares
TION. Mr. McPherson is Chairman and
Director of Baptist Medical Center;
Chairman of Oklahoma City Public
Schools Foundation; Director of
Kimberly-Clark Corporation, American
Petroleum Institute, Oklahoma City
[photo] Chamber of Commerce, Oklahoma
Chapter of the Nature Conservancy,
Oklahoma Foundation for Excellence,
Oklahoma Medical Research
Foundation, Oklahoma State Chamber
of Commerce, Oklahoma Academy for
State Goals, United Way Advisory
Board, University of Oklahoma Health
Science Center Board of Visitors;
and a Member of The Business
Roundtable, National Petroleum
Council and University of Oklahoma
College of Medicine Advisory
Committee.
4
<PAGE>
PRINCIPAL OCCUPATION AND
OTHER INFORMATION
THE NOMINEES DESIGNATED
BY ASTERISK(*) ARE "INTERESTED SECURITIES
EXPIRATION PERSONS" OF THE CORPORATION (AS THAT BENEFICIALLY
NAME, PERIOD(S) OF TERM TERM IS DEFINED IN THE INVESTMENT OWNED, DIRECTLY OR
SERVED AS IF ELECTED COMPANY ACT OF 1940, AS AMENDED) INDIRECTLY, AS OF
DIRECTOR AND (AGE) AS A DIRECTOR BECAUSE OF THEIR STATED ASSOCIATIONS. MARCH 29, 1995
- ----------------------- ------------- -------------------------------------- ------------------
John R. Galvin 1997 DISTINGUISHED POLICY ANALYST AT OHIO -0-
(65) STATE UNIVERSITY. Commencing July,
1995, General Galvin will be the
Dean of the Fletcher School of Law
and Diplomacy at Tufts University.
General Galvin is Chairman of the
American Council on Germany; a
Governor of the Center for Creative
Leadership; Director of USLIFE and
[photo] the Institute for Defense Analysis;
Ambassador, U.S. State Department;
and Consultant of Thomson CSF
(electronics). From July, 1992 to
June, 1994, General Galvin was the
Olin Distinguished Professor of
National Security Studies at the
United States Military Academy and
from June, 1987 to June, 1992,
General Galvin was the Supreme
Allied Commander, Europe and the
Commander-in-Chief, United States
European Command.
OTHER DIRECTORS
The other Directors of the Corporation whose terms will not expire in 1995 are:
PRINCIPAL OCCUPATION AND
OTHER INFORMATION
THE PERSONS DESIGNATED
BY ASTERISK(*) ARE "INTERESTED SECURITIES
EXPIRATION OF PERSONS" OF THE CORPORATION (AS THAT BENEFICIALLY
NAME, PERIOD(S) PRESENT TERM IS DEFINED IN THE INVESTMENT OWNED, DIRECTLY OR
SERVED AS TERM COMPANY ACT OF 1940, AS AMENDED) INDIRECTLY, AS OF
DIRECTOR AND (AGE) AS A DIRECTOR BECAUSE OF THEIR STATED ASSOCIATIONS. MARCH 29, 1995
- ----------------------- ------------- -------------------------------------- ------------------
Fred E. Brown* 1997 DIRECTOR OR TRUSTEE, VARIOUS ORGANI- 59,327 Common
1959 to Date ZATIONS, NEW YORK, NY. Mr. Brown is Shares
(81) a Director or Trustee of each of the
Seligman Group investment
companies;+ Director and Consultant
of J. & W. Seligman & Co.
Incorporated; Director of Seligman
Financial Services, Inc. and
Seligman Services, Inc.; Trustee of
Lake Placid Education Foundation,
Lake Placid Center for the Arts and
Trudeau Institute, Inc.; formerly,
Director of J. & W. Seligman Trust
Company and Seligman Securities,
Inc.
5
<PAGE>
PRINCIPAL OCCUPATION AND
OTHER INFORMATION
THE PERSONS DESIGNATED
BY ASTERISK(*) ARE "INTERESTED SECURITIES
EXPIRATION OF PERSONS" OF THE CORPORATION (AS THAT BENEFICIALLY
NAME, PERIOD(S) PRESENT TERM IS DEFINED IN THE INVESTMENT OWNED, DIRECTLY OR
SERVED AS TERM COMPANY ACT OF 1940, AS AMENDED) INDIRECTLY, AS OF
DIRECTOR AND (AGE) AS A DIRECTOR BECAUSE OF THEIR STATED ASSOCIATIONS. MARCH 29, 1995
- ----------------------- ------------- -------------------------------------- ------------------
John E. Merow* 1996 PARTNER, SULLIVAN & CROMWELL, LAW 10,182 Common
1991 to Date FIRM, NEW YORK, NY. Mr. Merow is a Shares
(65) Director or Trustee of each of the
Seligman Group investment
companies,+ Municipal Art Society of
New York, Commonwealth Aluminum
Corporation, U.S. Council for
International Business and U.S.-New
Zealand Council; Member of the
American Law Institute and the
Council on Foreign Relations;
Chairman of the American Australian
Association; and Member of the Board
of Governors of Foreign Policy
Association and New York Hospital.
Betsy S. Michel 1996 ATTORNEY, GLADSTONE, NJ. Mrs. Michel 32,880 Common
1985 to Date is a Director or Trustee of each of Shares
(52) the Seligman Group investment
companies+ and The National
Association of Independent Schools
(Washington, D.C.); and Chairman of
the Board of Trustees of St.
George's School (Newport, RI).
6
<PAGE>
PRINCIPAL OCCUPATION AND
OTHER INFORMATION
THE PERSONS DESIGNATED
BY ASTERISK(*) ARE "INTERESTED SECURITIES
EXPIRATION OF PERSONS" OF THE CORPORATION (AS THAT BENEFICIALLY
NAME, PERIOD(S) PRESENT TERM IS DEFINED IN THE INVESTMENT OWNED, DIRECTLY OR
SERVED AS TERM COMPANY ACT OF 1940, AS AMENDED) INDIRECTLY, AS OF
DIRECTOR AND (AGE) AS A DIRECTOR BECAUSE OF THEIR STATED ASSOCIATIONS. MARCH 29, 1995
- ----------------------- ------------- -------------------------------------- ------------------
William C. Morris* 1997 CHAIRMAN AND PRESIDENT OF J. & W. 37,068 Common
1988 to Date SELIGMAN & CO. INCORPORATED, NEW Shares
(56) YORK, NY. Mr. Morris is Chairman and
Chief Executive Officer of each of
the Seligman Group investment
companies;+ Chairman, J. & W.
Seligman Trust Company, Seligman
Financial Services, Inc., Seligman
Services, Inc. and Carbo Ceramics
Inc.; Director of Daniel Industries,
Inc., Kerr-McGee Corporation and
Seligman Data Corp. (formerly, Union
Data Service Center, Inc.);
formerly, Member of the Board of
Governors of the Investment Company
Institute; and Chairman of Seligman
Securities, Inc.
James C. Pitney 1996 PARTNER, PITNEY, HARDIN, KIPP & 14,137 Common
1981 to Date SZUCH, LAW FIRM, MORRISTOWN, NJ. Mr. Shares
(68) Pitney is a Director or Trustee of
each of the Seligman Group
investment companies+ and Public
Service Enterprise Group.
7
<PAGE>
PRINCIPAL OCCUPATION AND
OTHER INFORMATION
THE PERSONS DESIGNATED
BY ASTERISK(*) ARE "INTERESTED SECURITIES
EXPIRATION OF PERSONS" OF THE CORPORATION (AS THAT BENEFICIALLY
NAME, PERIOD(S) PRESENT TERM IS DEFINED IN THE INVESTMENT OWNED, DIRECTLY OR
SERVED AS TERM COMPANY ACT OF 1940, AS AMENDED) INDIRECTLY, AS OF
DIRECTOR AND (AGE) AS A DIRECTOR BECAUSE OF THEIR STATED ASSOCIATIONS. MARCH 29, 1995
- ----------------------- ------------- -------------------------------------- ------------------
James Q. Riordan 1997 DIRECTOR, VARIOUS CORPORATIONS, 102,007 Common
1989 to Date STUART, FL. Mr. Riordan is a Direc- Shares
(67) tor or Trustee of each of the
Seligman Group investment
companies,+ The Brooklyn Museum, The
Brooklyn Union Gas Company, The
Committee for Economic Development,
Dow Jones & Co., Inc. and Public
Broadcasting Service; formerly,
Co-Chairman of the Policy Council of
The Tax Foundation; Director and
President of Bekaert Corporation;
and Director of Tesoro Petroleum
Companies, Inc.
Ronald T. Schroeder* 1997 DIRECTOR, MANAGING DIRECTOR AND 4,095 Common
1984 to 1988 CHIEF INVESTMENT OFFICER OF J. & W. Shares
1991 to Date SELIGMAN & CO. INCORPORATED, NEW
(47) YORK, NY. Mr. Schroeder is
President, Chief Investment Officer
and Director of the Corporation and
a Director or Trustee and President,
Chief Investment Officer of each of
the open-end investment companies in
the Seligman Group investment
companies;+ Director of Seligman
Quality Municipal Fund, Inc.,
Seligman Select Municipal Fund,
Inc., Seligman Financial Services,
Inc., Seligman Data Corp. (formerly
Union Data Service Center, Inc.),
Seligman Services, Inc. and Seligman
Henderson Co.; formerly, Director of
J. & W. Seligman Trust Company and
Seligman Securities, Inc.
8
<PAGE>
PRINCIPAL OCCUPATION AND
OTHER INFORMATION
THE PERSONS DESIGNATED
BY ASTERISK(*) ARE "INTERESTED SECURITIES
EXPIRATION OF PERSONS" OF THE CORPORATION (AS THAT BENEFICIALLY
NAME, PERIOD(S) PRESENT TERM IS DEFINED IN THE INVESTMENT OWNED, DIRECTLY OR
SERVED AS TERM COMPANY ACT OF 1940, AS AMENDED) INDIRECTLY, AS OF
DIRECTOR AND (AGE) AS A DIRECTOR BECAUSE OF THEIR STATED ASSOCIATIONS. MARCH 29, 1995
- ----------------------- ------------- -------------------------------------- ------------------
Robert L. Shafer 1997 VICE PRESIDENT, PFIZER, INC., NEW 1,142 Common
1991 to Date YORK, NY. Mr. Shafer is a Director Shares
(62) or Trustee of each of the Seligman
Group investment companies+ and
USLIFE Corporation.
James N. Whitson 1996 EXECUTIVE VICE PRESIDENT AND CHIEF 2,980 Common
1993 to Date OPERATING OFFICER AND DIRECTOR, Shares
(60) SAMMONS ENTERPRISES, INC., DALLAS,
TX. Mr. Whitson is a Director or
Trustee of each of the Seligman
Group investment companies+, Red Man
Pipe and Supply Company and C-SPAN.
Brian T. Zino* 1996 DIRECTOR, MANAGING DIRECTOR, J. & W. 18,025 Common
1993 to Date SELIGMAN & CO. INCORPORATED, NEW Shares
(42) YORK, NY. Mr. Zino is a Director or
Trustee of each of the Seligman
Group investment companies;+
Chairman, Seligman Data Corp.
(formerly, Union Data Service
Center, Inc.), Director of Seligman
Financial Services, Inc., J. & W.
Seligman Trust Company and Seligman
Services, Inc.; Senior Vice
President of Seligman Henderson Co.;
formerly, Director and Secretary of
Chuo Trust--JWS Advisors, Inc.; and
Director of Seligman Securities,
Inc.
</TABLE>
+ The Seligman Group of investment companies consists of the Corporation,
Seligman Capital Fund, Inc., Seligman Cash Management Fund, Inc., Seligman
Common Stock Fund, Inc., Seligman Communications and Information Fund, Inc.,
Seligman Frontier Fund, Inc., Seligman Growth Fund, Inc., Seligman Henderson
Global Fund Series, Inc., Seligman High Income Fund Series, Seligman Income
Fund, Inc., Seligman New Jersey Tax-Exempt Fund, Inc., Seligman Pennsylvania
Tax-Exempt Fund Series, Seligman Portfolios, Inc., Seligman Quality Municipal
Fund, Inc., Seligman Select Municipal Fund, Inc., Seligman Tax-Exempt Fund
Series, Inc. and Seligman Tax-Exempt Series Trust.
9
<PAGE>
Unless otherwise indicated, Directors have sole voting and investment power
with respect to shares shown.
At February 23, 1995, all Directors and Officers of the Corporation as a
group owned beneficially 290,367 shares or 0.34% of the Corporation's Common
Stock.
Of the total shares shown for Mrs. Michel, 32,029 shares are in three
trusts over which she serves as co-trustee. Mrs. Michel disclaims beneficial
ownership or interest in these securities.
Of the total shares shown for Mr. Morris, 15,202 shares are in two trusts
for his children. Mr. Morris disclaims beneficial ownership or interest in these
securities.
Of the total shares shown for Mr. Zino, 486 shares are registered in his
wife's name. Mr. Zino disclaims beneficial ownership or interest in these
securities.
Mr. James Q. Riordan, a Director, purchased 65,217 shares of
Tri-Continental Corporation on June 13, 1994. This transaction was not reported
on Form 4 in July 1994, but was subsequently reported on Form 4 on August 9,
1994.
The Board of Directors met six times during 1994. The standing committees
of the Board include the Board Operations Committee, Audit Committee and
Director Nominating Committee. These Committees are comprised solely of
Directors who are not "interested persons" of the Corporation as that term is
defined in the Investment Company Act of 1940, as amended (the "1940 Act"). The
duties of these Committees are described below.
BOARD OPERATIONS COMMITTEE. This Committee has authority generally to
direct the operations of the Board, including the nomination of members of other
Board Committees, and the selection of legal counsel for the Corporation. The
Committee met three times in 1994. This Committee comprises all Directors who
are not "interested persons" of the Corporation.
AUDIT COMMITTEE. This Committee recommends the independent public
accountants for selection as auditors by the Board and stockholder approval
annually. In addition, it reviews, with the auditors and such other persons as
it determines, (a) the scope of audit, (b) accounting and financial internal
controls, (c) quality and adequacy of the accounting staff and (d) reports of
the auditors. The Committee comments to the Board when warranted and at least
annually. It is directly available to the auditors and officers of the
Corporation for consultation on audit, accounting and related financial matters.
The Committee met twice in 1994. Members of this Committee are Messrs. Schmidt
(Chairman), Nichols and Whitson and Mrs. Michel. Messrs. Schmidt and Nichols
will be replaced as Committee members by the Board of Directors following the
1995 Annual Meeting.
10
<PAGE>
DIRECTOR NOMINATING COMMITTEE. This Committee recommends to the Board
persons to be nominated for election as Directors by you and the other
Stockholders and selects and proposes nominees for election by the Board between
Annual Meetings. The Committee will consider suggestions from Stockholders
submitted in writing to the Secretary of the Corporation. The Committee met
three times in 1994. Members of this Committee are Messrs. Pitney (Chairman),
Riordan and Shafer and Dr. Ilchman.
EXECUTIVE OFFICERS OF THE CORPORATION
Information with respect to Executive Officers, other than Messrs. Morris
and Schroeder, is as follows:
POSITION WITH CORPORATION AND
NAME AGE PRINCIPAL OCCUPATION DURING PAST FIVE YEARS
- --------------------------------------------------------------------------------
Charles C. Smith, Jr. 38 VICE PRESIDENT OF THE CORPORATION since
December 1994. Mr. Smith is a Managing
Director of the Manager (formerly, Senior
Vice President and Senior Investment
Officer).
Lawrence P. Vogel 38 VICE PRESIDENT (FORMERLY, TREASURER) OF THE
CORPORATION since January 1992. Mr. Vogel is
also Vice President of the other Seligman
Group investment companies; Senior Vice
President, Finance of the Manager, Seligman
Financial Services, Inc. and Seligman Data
Corp. (formerly, Union Data Service Center,
Inc.); (formerly, Treasurer); Treasurer,
Seligman Henderson Co.; formerly, Audit
Senior Manager, Price Waterhouse, Senior
Vice President, Finance of Seligman
Securities, Inc. and Senior Vice President,
J. & W. Seligman Trust Company
Frank J. Nasta 30 SECRETARY OF THE CORPORATION since March
1994. Mr. Nasta is also Secretary of the
Manager, the other Seligman Group investment
companies, Seligman Data Corp. (formerly,
Union Data Service Center, Inc.), Seligman
Financial Services, Inc., Seligman Services,
Inc., J. & W. Seligman Trust Company and
Seligman Henderson Co. Vice President, Law
and Regulation of the Manager; formerly,
attorney at the law firm of Seward & Kissel.
Thomas G. Rose 37 TREASURER OF THE CORPORATION since November
1994. Mr. Rose is also Treasurer of the
other Seligman Group investment companies
and Seligman Data Corp. (formerly, Union
Data Service Center, Inc.); formerly,
Treasurer, American Investors Advisors, Inc.
11
<PAGE>
All officers are elected annually by the Board and serve until their
successors are elected and qualify or their earlier resignation. The address of
each of the foregoing Officers is 100 Park Avenue, New York, New York 10017.
REMUNERATION OF DIRECTORS AND OFFICERS
Directors of the Corporation who are not employees of the Manager or its
affiliates each receive from the Corporation fees of $16,000 per year. In
addition, such Directors are paid up to $400 for each day on which they attend
Board and/or Committee meetings and are reimbursed for the expenses of attending
meetings. Total Directors' fees paid by the Corporation for the year ended
December 31, 1994 were as follows:
NUMBER OF DIRECTORS CAPACITY IN WHICH REMUNERATION AGGREGATE DIRECT
IN GROUP WAS RECEIVED REMUNERATION
- ------------------ ----------------------------------- -----------------
9 Directors and Members of Committees $166,400
Directors attendance, retainer and/or committee fees paid to each Director
during 1994 was as follows:
<TABLE>
<CAPTION>
AGGREGATE PENSION OR RETIREMENT TOTAL COMPENSATION
COMPENSATION BENEFITS ACCRUED AS FROM CORPORATION AND
NAME FROM FUND PART OF CORPORATION EXPENSES FUND COMPLEX*
- ------------------------------------- ------------ ---------------------------- --------------------
<S> <C> <C> <C>
Alice S. Ilchman $18,800 -0- $67,000
John E. Merow 18,400** -0- 66,000
Betsy S. Michel 18,400 -0- 66,000
Douglas R. Nichols, Jr. 18,400 -0- 66,000
James C. Pitney 18,800 -0- 67,000
James Q. Riordan 18,400 -0- 66,000
Herman J. Schmidt 18,400 -0- 66,000
Robert L. Shafer 18,400 -0- 66,000
James N. Whitson 18,400** -0- 66,000
-----------
$166,400
===========
</TABLE>
- ---------------
* There are 16 other investment companies in the Seligman Group.
** Mr. Merow has elected to defer receiving his fees from the Corporation. From
1991 to December 31, 1994, Mr. Merow has deferred $73,710.00, including
interest earned. Mr. Pitney, who had deferred receiving his fees from the
Corporation from 1983 up to 1993, has a balance of $225,766.00 in his
deferred plan, including interest earned. Mr. Whitson has also elected to
defer receiving his fees from the Corporation. From 1993 to December 31,
1994, Mr. Whitson has deferred $31,559.00, including interest earned.
12
<PAGE>
No compensation is paid by the Corporation to Directors or officers of the
Corporation who are employees of, or consultants to, the Manager.
The affirmative vote of a plurality of the votes cast at the meeting is
required to approve the election of the proposed Directors.
YOUR BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT THE
STOCKHOLDERS VOTE FOR THE ELECTION OF THE FOREGOING
NOMINEES TO SERVE AS DIRECTORS OF THE CORPORATION.
B. RATIFICATION OF SELECTION OF AUDITORS
----------------------------------------
(Proposal 2)
In accordance with the requirements of the 1940 Act, the Board of Directors
is required to select independent public accountants as auditors of the
Corporation for 1995, subject to ratification or rejection by Stockholders.
The Audit Committee of the Board of Directors has recommended, and the
Board of Directors, including a majority of those members who are not
"interested persons" of the Corporation (as defined in the 1940 Act), has
selected Deloitte & Touche LLP. The firm of Deloitte & Touche LLP has extensive
experience in investment company accounting and auditing. It is expected that a
representative of Deloitte & Touche LLP will be present at the Meeting and will
have the opportunity to make a statement and respond to questions.
The affirmative vote of a majority of the votes cast at the meeting is
required to ratify the selection of auditors.
YOUR BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS
APPROVAL OF THIS PROPOSAL.
C. OTHER MATTERS
----------------
Stockholder Proposal No. 1
Mr. John Jennings Crapo, P.O. Box 151, Porter Square, Cambridge,
Massachusetts 02140-0002 is the registered owner of 131 shares of the
Corporation's Common Stock and has notified the Corporation that he intends to
introduce the following proposal at the Meeting:
Resolved: It is the judgment of Stockholders of Tri-Continental Corporation
("TY") that the Directors of TY elected at each annual meeting of the
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Stockholders commencing with the Annual Meeting of Stockholders in 1998 SHALL be
elected to hold office until the next Annual Meeting of Stockholders of TY and
until their successors are elected and qualified. Directors of TY whose terms of
office expire in 1996 and 1997 SHALL continue to hold office for the respective
terms for which they were elected.
Mr. Crapo has submitted the following statement in support of his proposal:
Propounder believes his proposal has merit inspite the fact Stockholders of
various registrants of which he has offered motion in the past have upon the
advice of the respective boards rejected the proposal to eliminate staggered
boards.
Commonwealth Energy System ("CES") is an example of such a registrant. It's
stockholders voted May 05, 1994 to reject proponent's motion to declassify it's
governing board.
The May 05, 1994 CES stockholder meeting, which was propounder's fourth
successive year at which he presented motion to CES Stockholders that they
declassify CES governing board. In his letter to Proponent of May 10, 1994, the
Honorable Michael "Mike" P. Sullivan, Esquire, CES Vice President, Secretary and
General Counsel confirmed the vote at said stockholder meeting was 1,483,947
Common Shares or 14% were voted in favor of propounder's motion to declassify,
5,917,813 Common Shares or 57% were cast against declassification, and 272,511
Common Shares or 3% Abstained from said motion. Four presentations were at
Cambridge, Massachusetts.
Arguments of Mr. Timothy N. Cronin, ESQUIRE, CES Senior Attorney in 1994
against propounder's motion to declassify the CES governing Board are a
classified board is intended to assure continued familiarity of board members
with the business, management and policies of it's system since a majority of
it's members at any given time would have prior experience as Trustees. The
classified board was designed at CES to encourage persons seeking to acquire
control of it to initiate an acquisition through arms length negotiations with
CES' management and Board by making it more difficult to change the composition
of CES Board. In adopting a classified board CES stockholders provided it's
management more time and more information for evaluating a takeover proposal in
order to fully protect System's and Stockholders' interests.
Mr. Frank J. Nasta, Esquire, Secretary TY reported to propounder by letter
June 02, 1994 stockholders of our Corporation voted 16,094,412 common shares for
declassification, 28,851,901 common shares against declassification and
3,120,707 common shares voted abstention at the May 19, 1994 Annual Meeting of
Stockholders of our Corporation. The percentage of shares voting in FAVOR of
declassification to the total shares for, against, and in abstention, was 33.5%
Mr. Nasta reported.
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Propounder's belief is this day, Sunday June 19, 1994, continues that
declassification of our Corporation governing board will make it easier for us
to understand the current governing board's demeanor, and more stockholders will
agree with him on this matter.
YOUR BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT
YOU VOTE AGAINST THIS STOCKHOLDER PROPOSAL FOR THE
REASONS DISCUSSED COMMENCING ON PAGE 16.
Stockholder Proposal No. 2
Mrs. Eleanor Lipson, 3040 Foxcroft Road, Ann Arbor, Michigan 48104 is the
registered owner of 18,754 shares of the Corporation's Common Stock and has
notified the Corporation that she intends to introduce the following proposal at
the meeting:
RESOLVED, that the shareholders of Tri-Continental Corporation recommend
that the board of directors take the steps, in accordance with state law, that
are required to provide that in future board of directors elections, directors
shall be elected annually and not by classes as is now provided. Such
declassification of the board should be effected in a manner that does not
affect the unexpired terms of directors previously elected.
Mrs. Lipson has submitted the following statement in support of her
proposal:
The directors of Tri-Continental Corporation are currently divided into
three classes serving three-year staggered terms. That structure means that the
shareholders cannot vote to replace a majority of the board of directors for at
least two election cycles. While it can be argued that a classified board
provides continuity in the governance of a corporation, I believe that such a
structure can also be used by incumbent management to avoid accountability to
shareholders.
Annual election of directors might provide the opportunity for new
shareholders to be represented, which might encourage management to focus on
serving current shareholder interests. I believe that such a change might make
alternate slates of directors available to the shareholders, rather than only
those approved by the Board Nominating Committee. This could cause additional
board turnover, and might result in the adoption of policies more attuned to
shareholder interests.
A SIMILAR PROPOSAL IN 1994 WAS SUPPORTED BY 33.5% OF THE VOTES CAST. In
1994, 44% of the eligible shares were not voted, either because these
shareholders did not participate or abstained. I believe that this kind of
proposal might carry in 1995, if there were greater shareholder participation.
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I am a long-term shareholder, and a significant portion of our family's
investment is in Tri-Continental Corporation Common Stock. I believe that the
proposed change would advance democracy in the governance of our corporation.
I URGE YOUR SUPPORT FOR THIS PROPOSAL.
YOUR BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT
YOU VOTE AGAINST THIS STOCKHOLDER PROPOSAL
FOR THE REASONS SET FORTH BELOW.
The Board of Directors believes that the adoption of either of these
proposals would not be in the best interest of the Corporation and its
Stockholders.
The Board of Directors continues to believe that a classified Board
provides continuity, stability and experience in leadership and in directing
corporate strategy. Continuity, stability and experience create long-term value
for Stockholders. At the same time, a classified Board ensures that Directors
will be fully accountable to Stockholders because each year a portion of the
Board must stand before the Stockholders for election.
The Board of Directors believes that the classified structure has enabled
the Corporation to attract and retain prominent and well-qualified individuals
who are able to commit the time and resources to understand the Corporation and
its structure. A classified Board therefore improves the ability of Directors to
more effectively represent the interest of all the Stockholders.
One of the proponents states that changing to a single class of directors
might result in the election of directors other than those approved by the Board
Nominating Committee. Irrespective of whether there are three classes of
directors or only one, election of the persons nominated as Directors by the
current board is never a foregone conclusion.
This proponent also suggests that the current three-class structure has
permitted management to avoid accountability to Stockholders. Your Directors are
deeply committed to the best interests of the Corporation and its Stockholders.
The Board regularly examines the Corporation's investment results and evaluates
the success of management in meeting the Corporation's objectives. Your
Directors will continue to represent your interests whether they are elected for
terms of one year or three.
Stockholders of the Corporation considered a substantially similar proposal
in 1994, which was also submitted by Mr. Crapo. That proposal was rejected by
the Stockholders. Indeed, as recently as 1993, Stockholders approved an
amendment to the Corporation's By-Laws that calls for three classes of Directors
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(previously there had been five classes). Your Board of Directors believes that
there have been no changes in circumstances since the vote in 1993 or last year
that should cause Stockholders to vote in favor of these proposals and continue
to recommend a vote against them.
As stated in Mr. Crapo's statement in support of his proposal, he has
submitted substantially similar proposals to other companies in prior years. The
shareholders of such companies have considered, and Mr. Crapo concedes that they
have rejected, each of these proposals. For the reasons enumerated herein, your
Directors believe you should also vote against the proposal.
Neither of these proposals will be adopted unless the votes cast in favor
of such proposal exceed the votes cast against it. Abstentions and broker
non-votes will not be counted as cast either for or against one of these
proposals. If not otherwise specified, Proxies will be voted AGAINST approval of
both proposals. The adoption of either proposal would not in itself result in
any action, but would simply amount to a request for action by the Board.
The Directors believe that your vote AGAINST these proposals will be in the
best interest of the Corporation and its Stockholders.
Stockholder Proposal No. 3
Mr. Nathan Lipson, 3040 Foxcroft Road, Ann Arbor, Michigan 48104 is the
registered owner of 23,878 shares of the Corporation's Common Stock and has
notified the Corporation that he intends to introduce the following proposal at
the meeting:
RESOLVED, that the shareholders recommend that the board of directors take
the steps necessary to provide that in future board of directors elections,
except for officers and employees of J. & W. Seligman & Co. and Tri-Continental
Corporation (the "inside directors" or "interested persons"), no person who is a
member of a board of directors of a corporation managed by J. & W. Seligman &
Co., shall qualify to serve on the board of directors of Tri-Continental
Corporation.
Mr. Lipson has submitted the following statement in support of his
proposal:
The directors of Tri-Continental Corporation (the Company) serve on all 17
boards of directors of the mutual funds managed by J. & W. Seligman & Co.
(Seligman). Since the other Seligman-managed funds have different policies and
objectives than Tri-Continental Corporation, it is inappropriate for those on
the other Seligman-managed boards to serve on the Company board. Changes are
needed to make it possible for the average Company shareholder to participate in
the governance of the Company and to avoid possible conflicts of interest on the
board.
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A change in the composition of the board can have the effect of directing
management to focus on improving the performance of the Company's portfolio.
Management should be made aware that the Company's total return continues to lag
behind the Standard & Poor's 500 Composite Stock Index, and below the
performance of many open-end mutual funds. It is my belief that a result of the
capital raised in the Company's last rights offering was to raise the management
fees paid to Seligman. I believe that these factors may account for the discount
from net asset value in the market price of the Company's shares since 1987, and
that with their correction the rating of the Company by mutual fund rating
analysts might improve.
I believe that needed management accountability might be better
accomplished by a board that includes more disinterested and dedicated outside
directors. It is my opinion that shareholders' concern about the governance of
the Company was reflected in the 1994 Annual Meeting where 33.5% of the votes
cast supported annual election of the board of directors.
As a long-term shareholder with a significant part of my investments in
Tri-Continental, I urge your support for this proposal.
YOUR BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT
YOU VOTE AGAINST THIS STOCKHOLDER PROPOSAL
FOR THE REASONS SET FORTH BELOW.
Your Board of Directors is very concerned about imposing additional
qualification requirements on potential Directors. Such limits would have the
effect of reducing the pool of well-qualified candidates from which you choose
your Directors. If the proposal is implemented, it would immediately result in
nine of the Corporation's current Directors becoming unqualified to stand in
future elections unless they resigned their directorships and trusteeships in
the other investment companies managed by Seligman. Losing these valuable
Directors, who have collectively served Tri-Continental in excess of 50 years,
would result in the loss of a depth of expertise, talent and experience. Such
expertise, talent, experience and continuity is a tremendous asset and is in the
best interests of the Corporation.
Many corporations, including Tri-Continental, have found it beneficial to
have Directors who are also Directors of other companies. This is particularly
true among families of investment funds, many of which have long recognized that
common boards provide numerous benefits, including cost savings and other
efficiencies, to each fund in their family individually. Directors on common
boards have the important benefit of a much broader knowledge of the investment
company business, and the family's investment adviser, than a director on only
one fund. In addition, similar issues often confront the boards of various
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investment companies in a complex of funds. The Corporation has learned that
directors serving on the boards of other funds bring experience, insight and
understanding to issues involving the Corporation, which is in the best
interests of Stockholders. Your Directors believe that this unique experience
and insight would be unavailable to the Corporation if this proposal were
adopted. Moreover, the compensation of the Corporation's Directors is set having
regard to the fact that they serve on the boards of other Seligman managed
funds, and if they were not Directors of such other Seligman managed funds, the
Corporation would find it necessary to increase Director remuneration,
increasing the expenses of the Corporation.
There is no requirement that Directors of the Corporation serve as
directors of other Seligman funds, and every Director is fully accountable to
the Stockholders whether or not he serves on the Board of another company. Each
year a portion of the Board must stand before the Stockholders for election.
Under the present system, Stockholders have the ability to elect the Directors
of their choice. Adoption of the artificial qualifications required under this
proposal would severely limit that choice.
The investment objective and policies of the Corporation are fully
understood by your Directors. Their service as Directors of other investment
funds does not affect their commitment to the Corporation meeting such
objective. In fact, your Directors believe that the insight gained from serving
as Directors for investment funds with differing investment objectives helps
provide a perspective that would otherwise be unavailable.
This proposal will not be adopted unless the votes cast in favor of such
proposal exceed the votes cast against it. Abstentions and broker non-votes will
not be counted as cast either for or against the proposal. If not otherwise
specified, Proxies will be voted AGAINST approval of the proposal. The adoption
of the proposal would not in itself result in any action, but would simply
amount to a request for action by the Board.
The Directors believe that your vote AGAINST this proposal will be in the
best interest of the Corporation and its Stockholders.
Stockholder Proposal No. 4
Mr. Jack N. Bonne, Horseshoe Hill Road, Pound Ridge, New York 10576 is the
registered owner of 685 shares of the Corporation's Common Stock and has
notified the Corporation that he intends to introduce the following proposal at
the meeting:
RESOLVED: That the stockholders of Tri-Continental Corporation assembled in
annual meeting in person and by proxy, hereby request the Board of Directors
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take the steps necessary to amend the Articles of Incorporation, By-Laws or
comply with other legal requirements to convert the fund from closed-end status
to an open-end mutual fund status.
Mr. Bonne has submitted the following statement in support of his proposal:
The reason for shareholders to vote in favor of this proposal is to provide
long term shareholders the opportunity TO MAXIMIZE THE RETURN ON THEIR
INVESTMENT BY ELIMINATING THE SUBSTANTIAL MARKET DISCOUNT FROM THE ACTUAL
UNDERLYING NET ASSET VALUE OF THEIR SHARES.
Increasingly, more closed-end funds have voted on proposals to convert to
open-end mutual fund status. For example, at the annual meetings of the
shareholders of four MFS Financial Services closed-end funds held last year,
approximately 35% of the votes cast were cast in favor of the proposals to
open-end the Funds.
Conversion of the fund shares from closed-end to open-end may also enhance
the attractiveness and marketability of the fund shares by eliminating the
discount and or premium feature inherent in closed-end funds.
In addition, conversion to an open-end mutual fund would permit
Tri-Continental shareholders to more easily monitor the actual investment
performance of their fund versus being currently required to measure separately
market performance and portfolio performance.
The Tri-Continental Corporation Fund market price has been trading at an
average discount from its net asset value in excess of 14% during the past year.
Conversion from a closed-end fund to an open-end fund will eliminate brokerage
commissions when buying and selling shares of the Company due to the loss of the
Company's listing on the New York Stock Exchange which would follow conversion.
However, there may be other transaction costs when buying and selling shares
following conversion.
Conversion to open-end status could possibly be a means of attracting new
capital for the Fund.
With the huge and vastly more competitive mutual fund industry now
consisting mostly of open-ended mutual funds, in my opinion there appears to be
little reason for Tri-Continental to remain as a closed-end fund. A common
reason given for keeping a fund closed-end is to protect the fund against
potential huge redemptions in the event of a severe market downturn.
If you agree that to best enhance the value of the shares of its
shareholders that the Directors take the steps necessary to convert
Tri-Continental Corporation from a closed-end mutual fund to an open-end mutual
fund, then please mark your proxy for this resolution, otherwise, if it is
unmarked, it will automatically be cast against the resolution.
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YOUR BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT
YOU VOTE AGAINST THIS STOCKHOLDER PROPOSAL
FOR THE REASONS SET FORTH BELOW.
Tri-Continental was organized in 1929 and has operated successfully as a
closed-end investment company for over sixty-five years. Your Directors believe
that the proposal to convert the Corporation into an open-end (mutual) fund is
not in the best interests of stockholders. The stockholders of the Corporation
have overwhelmingly rejected similar proposals on four prior occasions. The
stockholders of other closed-end investment companies have considered and, in
many cases, rejected, similar proposals to convert to open-end status. The
effect of such a change might be to provide some stockholders with a quick,
one-time profit, but it would be detrimental to other stockholders who have
invested for the longer term.
A principal reason offered in support of proposals to convert closed-end
funds to open-end status is the elimination of the discount from net asset value
at which the stocks of most closed-end investment companies (including
Tri-Continental) have traded in the market in recent years. While the discount
would be eliminated by conversion, this one-time gain could seriously jeopardize
the continuing viability of your Corporation. Moreover, long-term stockholders
would find that their money was invested in an entity with many characteristics
different from--and possibly less attractive than--the one they had purchased
shares in.
Closed-end investment companies have a fixed amount of capital. As a
result, portfolio managers are not hampered by non-investment considerations
such as continuous sales or redemptions of shares, and virtually all of a
closed-end fund's net assets may be invested in securities. In contrast,
open-end funds must seek to maintain cash reserves to provide for stockholder
redemptions in amounts that cannot be anticipated and may occur at inopportune
times. Purchases and redemptions of mutual fund shares can be affected by
investor psychology and sentiment as well as market and economic factors and can
be extremely volatile and unpredictable. It has been the experience of other
closed-end funds (for example, Alliance New Europe Fund, Inc., which converted
to open-end status in 1991) that conversion to open-end status results in
significant redemptions in the short term.
The possibility of redemptions could adversely affect the performance of
your Corporation in several ways if it were to convert to an open-end fund:
o Redemptions might force the sale of portfolio securities in amounts
and at times that could be least advantageous for non-redeeming
stockholders.
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o Redemptions could force your Corporation to realize capital gains
that would not otherwise be realized, with unfavorable tax
consequences to many continuing stockholders.
o Redemptions during a declining market may result in dilution of the
net asset value of the shares held by long-term investors who do not
redeem.
o Greater liquidity would have to be maintained against the possibility
of continuing redemptions.
o Liquidity concerns would constrain the portion of your Corporation's
assets that could be invested in less liquid securities including
private placements by smaller companies with excellent prospects but
with limited marketability.
o Because a portion of the Corporation's operating expenses remain
relatively constant as a fund's assets expand or contract, the
Corporation's expense ratio (the ratio of operating expenses to
average net assets) would increase as redemptions took place.
o Your Corporation would be forced to make arrangements to sell new
shares to offset redemptions.
o Your Corporation could find it necessary to adopt a "Rule 12b-1
plan", pursuant to which a fee would effectively be charged to
outstanding shares, in order to discourage redemptions and encourage
sales. Implementation of such a plan would materially increase the
Corporation's expense ratio.
o Uncertainty regarding the size and stability of the Corporation could
affect the ability of the Corporation and the Manager to attract and
retain capable personnel.
Your Directors remain concerned by the current discount and the Corporation
has regularly investigated the possible reasons for the discount. The discounts
for all closed-end funds have tended to fluctuate over a wide range. Despite
years of analysis and research, there is no generally accepted explanation for
these fluctuations. The shares of the Corporation have from time to time (and as
recently as December 1991) traded in excess of net asset value and at other
times the shares have traded at a discount from net asset value that is not
significant (for example, in late August 1992 the Corporation's shares traded at
a discount of less than 1.0%). While there can be no certainty that a
substantial reduction of the present discount will occur, there is likewise no
reason to believe that past experience of shares trading close to or above net
asset value will not be repeated.
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While discounts persist, however, investors are able to purchase additional
shares in the market and put more than a dollar of net assets to work for them
for every dollar invested. Many stockholders are currently taking advantage of
this situation by participating in a plan that provides for investment of the
Corporation's dividends, and payment of year-end gain distributions, in
additional shares, or by purchasing additional shares through one of the plans
offered by the Corporation. In fact, 81% of the registered holders of the
Corporation's common stock (representing some 87% of the shares held by
registered owners) participate in at least one of these investment options. (The
Corporation is unable to determine the level of participation by stockholders
who hold through brokers, but has no reason to believe the percentage is
significantly different.) This opportunity to invest at a discount would be lost
after open-ending because shares acquired by reinvestment would have to be
purchased at net asset value.
Similarly, it is probable that most current stockholders (including the
proponent of the open-ending proposal) purchased their stock in the Corporation
at a discount and understood the economic implications of their investment
decision. Purchases of Tri-Continental shares were made by stockholders in
preference to the hundreds of mutual funds which were readily available to them.
Stockholders who acquired shares at a discount from net asset value will of
course also stand to benefit if the discount diminishes in the future.
The stockholders have overwhelmingly voted against proposals to open-end
the Corporation at four prior annual meetings. More than 95% of the votes cast
at the meetings in 1966, 1967 and 1977, and more than 90% of the votes cast in
1978, were cast against proposals to convert to open-end status. At the time of
these votes, the Corporation's shares were trading at a discount comparable to
or greater than the discount currently prevailing. The stockholders also
expressed their approval of the Corporation's closed-end status at the annual
meeting in 1979. At that meeting, 84.5% of the shares voted were cast in favor
of amending the Corporation's Charter to increase (from a majority to two-thirds
of the outstanding shares) the vote required to convert it into an open-end
investment company (either by merger into another open-end investment company or
by making the Corporation's Common Stock redeemable) or to dissolve the
Corporation. The factors considered by the stockholders of the Corporation in
1966, 1967, 1977, 1978 and 1979 remain valid today.
Unlike most closed-end equity funds, the Corporation has outstanding both
preferred stock and warrants to purchase common stock. To the extent that the
rate of the dividends paid on the preferred stock is less than the return on the
Corporation's investments, and so long as the warrants remain unexercised, the
return to holders of common stock is increased. If the Corporation were to
convert to open-end status, the preferred stock and warrants would have to be
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redeemed, resulting not only in an outflow of capital to pay for the
redemptions, but also in a loss by holders of common stock of this beneficial
"leverage" effect. It is not even legally clear whether it would be possible to
redeem the outstanding warrants or make other appropriate provisions to protect
the warrantholders. The Corporation's charter does not provide for redemption of
the warrants under any circumstances.
Even assuming these issues could be resolved, the costs of the process of
conversion to an open-end fund, including the legal, accounting and printing
costs, would be significant. These costs would be borne by the common
stockholders. It is also likely that the change would result in a sharp increase
in the Corporation's operating costs and operating costs per share because
continuous sales and redemptions would probably result in increased transaction
costs. The Corporation has historically had an unusually low expense ratio, and
this benefit to stockholders would be jeopardized by open-ending. A number of
funds that have converted to open-end status, including The Japan Fund, Inc. and
Piper Global Funds Inc., have experienced significantly higher expense ratios
since their conversion. As a closed-end fund, the expense ratio of The Japan
Fund, Inc. averaged about 72 basis points annually. Since the fund open-ended in
1987 its assets have nearly doubled, yet its expense ratio has risen as high as
142 basis points (in 1992) and has averaged 117 basis points per year.
Similarly, since open-ending in 1992 the assets of Piper Global Funds Inc. have
increased five times while its expense ratio has risen from 177 basis points to
more than 200 basis points on average.
Open-ending would also cause the Corporation automatically to lose its
listing on the New York Stock Exchange ("NYSE"). Your Directors believe that the
Corporation's NYSE listing is important. A public market for the Corporation's
shares means that a stockholder may sell his or her shares without reducing the
total assets of the Corporation. Without a listing, stockholders would instead
redeem their shares, and the assets of the Corporation would be reduced.
Moreover, certain investors, such as some pension funds, have internal
restrictions on the amount of their portfolio that may be invested in unlisted
securities. Such stockholders might be forced to redeem their shares if the
Corporation converted to an open-end fund.
In summary, your Directors believe that there is an important continuing
service to be provided to the investing public by Tri-Continental Corporation as
a large and broadly diversified closed-end investment fund. Your vote against
the proposal to convert the fund from closed-end status to open-end mutual fund
status will help to assure its continuity as a closed-end fund in the long-term
interests of all its stockholders.
This proposal will not be adopted unless the votes cast in favor of such
proposal exceed the votes cast against it. Abstentions and broker non-votes will
not be counted as cast either for or against the proposal. If not otherwise
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specified, Proxies will be voted AGAINST approval of the proposal. The adoption
of the proposal would not in itself result in any action, but would simply
amount to a request for action by the Board.
---------------
The Management knows of no other matters which are to be brought before the
Meeting. However, if any other matters come before the Meeting, it is intended
that the persons named in the enclosed form of Proxy, or their substitutes, will
vote the Proxy in accordance with their judgment on such matters.
Notice is hereby given that any Stockholder proposal that may properly be
included in the proxy solicitation material for the next Annual Meeting, now
scheduled for May 1996, must be received by the Corporation no later than
December 14, 1995.
D. EXPENSES
-----------
The Corporation will bear the cost of soliciting Proxies. In addition to
the use of the mails, Proxies may be solicited personally or by telephone or
telegraph by Directors, officers and employees of the Corporation, the Manager,
Seligman Financial Services, Inc., J. & W. Seligman Trust Company, Seligman
Services, Inc. and Seligman Data Corp., and the Corporation may reimburse
persons holding shares in their names or names of their nominees for their
expenses in sending solicitation material to their principals. The Corporation
has engaged Morrow & Co., Inc., 909 Third Avenue, New York, N.Y. 10022-4799 to
assist in soliciting for a fee of $25,000 plus expenses.
By order of the Board of Directors,
/s/Frank J. Nasta
Secretary
-----------
IT IS IMPORTANT THAT PROXIES BE RETURNED PROMPTLY. ALL STOCKHOLDERS,
INCLUDING THOSE WHO EXPECT TO ATTEND THE MEETING, ARE URGED TO DATE, FILL IN,
SIGN AND MAIL THE ENCLOSED FORM OF PROXY IN THE ENCLOSED RETURN ENVELOPE WHICH
REQUIRES NO POSTAGE IF MAILED IN THE UNITED STATES. A PROXY IS NOT REQUIRED FOR
ADMISSION TO THE MEETING.
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<PAGE>
TRI-CONTINENTAL CORPORATION
Managed by
[J. & W. SELIGMAN & CO. LOGO]
J. & W. SELIGMAN & CO.
INCORPORATED
INVESTMENT MANAGERS AND ADVISORS
ESTABLISHED 1864
100 Park Avenue, New York, NY 10017
<PAGE>
PROXY TRI-CONTINENTAL CORPORATION COMMON
100 Park Avenue, New York, NY 10017
The undersigned, revoking previous proxies, acknowledges receipt of the Notice
of Meeting and Proxy Statement for the Annual Meeting of Stockholders of
TRI-CONTINENTAL CORPORATION to be held May 18, 1995 and appoints JOHN E. MEROW,
WILLIAM C. MORRIS and RONALD T. SCHROEDER (and each of them) proxies, with
power of substitution to attend the Annual Meeting (and any adjournments
thereof) and vote all shares the undersigned is entitled to vote upon the
matters indicated and on any other business that may properly come before
the Meeting.
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER DIRECTED BY THE
UNDERSIGNED. IF NO INSTRUCTIONS ARE GIVEN, YOUR PROXIES WILL VOTE FOR THE
ELECTION OF THE NOMINEES OF THE BOARD OF DIRECTORS AND FOR PROPOSAL 2 AND
AGAINST PROPOSALS 3,4,5 AND 6.
THE SOLICITATION OF THIS PROXY IS MADE ON BEHALF OF THE BOARD OF DIRECTORS
- --------------------------------------------------------------------------
To vote for all items AS RECOMMENDED BY THE
/ / BOARD OF DIRECTORS, mark this box, sign, date and
return this proxy. (NO ADDITIONAL VOTE IS NECESSARY.)
- --------------------------------------------------------------------------
- --------------------------------------------------------------------------
THE BOARD OF DIRECTORS RECOMMENDS YOU VOTE FOR EACH OF THE
NOMINEES AND FOR PROPOSAL 2
- --------------------------------------------------------------------------
1. ELECTION OF DIRECTORS
NOMINEES: Alice S. Ilchman, Frank A. McPherson and John R. Galvin
/ / FOR / / AGAINST / / WITHHOLDING AUTHORITY
all nominees all nominees for individual nominees listed
below
- --------------------------------------------------------------------------
2. Ratification of the selection of Deloitte & Touche, LLP as Auditors
/ / FOR / / AGAINST / / ABSTAIN
- --------------------------------------------------------------------------
THE BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE AGAINST PROPOSALS 3 AND 4
- --------------------------------------------------------------------------
3. Stockholder Proposal relating FOR / / AGAINST / / ABSTAIN / /
to declassification of the
Board of Directors
4. Stockholder Proposal relating FOR / / AGAINST / / ABSTAIN / /
to declassification of the
Board of Directors
YOUR VOTE IS IMPORTANT. COMPLETE, SIGN ON REVERSE SIDE AND RETURN THIS CARD AS
SOON AS POSSIBLE. MARK EACH VOTE WITH AN X IN THE BOX.
<PAGE>
THE BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE AGAINST PROPOSALS 5 AND 6
5. Stockholder Proposal imposing FOR / / AGAINST / / ABSTAIN / /
additional qualification
requirements on potential Directors
6. Stockholder Proposal relating to FOR / / AGAINST / / ABSTAIN / /
conversion from a closed-end fund
to an open-end fund.
DATED __________________________________________________, 1995
______________________________________________________________
Signature
______________________________________________________________
Signature (if jointly held)
Please sign exactly as your name(s) appear(s) on this proxy(ies).
Only one signature is required in case of a joint account. When
signing in a representative capacity, please give title.
YOUR VOTE IS IMPORTANT. PLEASE COMPLETE, SIGN AND RETURN THIS CARD AS SOON AS
POSSIBLE. MARK EACH VOTE WITH AN X IN THE BOX.
<PAGE>
PROXY TRI-CONTINENTAL CORPORATION PREFERRED
100 Park Avenue, New York, NY 10017
The undersigned, revoking previous proxies, acknowledges receipt of the Notice
of Meeting and Proxy Statement for the Annual Meeting of Stockholders of
TRI-CONTINENTAL CORPORATION to be held May 18, 1995 and appoints JOHN E. MEROW,
WILLIAM C. MORRIS and RONALD T. SCHROEDER (and each of them) proxies, with
power of substitution to attend the Annual Meeting (and any adjournments
thereof) and vote all shares the undersigned is entitled to vote upon the
matters indicated and on any other business that may properly come before the
Meeting.
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER DIRECTED
BY THE UNDERSIGNED. IF NO INSTRUCTIONS ARE GIVEN, YOUR PROXIES WILL VOTE FOR
THE ELECTION OF THE NOMINEES OF THE BOARD OF DIRECTORS AND FOR PROPOSAL 2 AND
AGAINST PROPOSALS 3,4,5 AND 6.
THE SOLICITATION OF THIS PROXY IS MADE ON BEHALF OF THE BOARD OF DIRECTORS
- -------------------------------------------------------------------------------
To vote for all items AS RECOMMENDED BY THE
/ / BOARD OF DIRECTORS, mark this box, sign, date and
return this proxy. (NO ADDITIONAL VOTE IS NECESSARY.)
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
THE BOARD OF DIRECTORS RECOMMENDS YOU VOTE FOR EACH OF THE
NOMINEES AND FOR PROPOSAL 2
- -------------------------------------------------------------------------------
1. ELECTION OF DIRECTORS
NOMINESS: Alice S. IIchman, Frank A. McPherson and John R. Galvin
/ / FOR / / AGAINST / / WITHHOLDING AUTHORITY
all nominees all nominess for individual nominees
listed below
----------------------------------------------------------------------
2. Ratification of the selection of Deloitte & Touche, LLP as Auditors
/ / FOR / / AGAINST / / ABSTAIN
- -------------------------------------------------------------------------------
THE BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE AGAINST PROPOSALS 3 AND 4
- -------------------------------------------------------------------------------
3. Stockholder Proposal relating FOR / / AGAINST / / ABSTAIN / /
to declassification of the
Board of Directors
4. Stockholder Proposal relating FOR / / AGAINST / / ABSTAIN / /
to declassification of the
Board of Directors
YOUR VOTE IS IMPORTANT. COMPLETE, SIGN ON REVERSE SIDE AND RETURN THIS CARD AS
SOON AS POSSIBLE. MARK EACH VOTE WITH AN X IN THE BOX.
<PAGE>
THE BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE AGAINST PROPOSALS 5 AND 6
5. Stockholder Proposal imposing FOR / / AGAINST / / ABSTAIN / /
additional qualification
requirements on potential Directors
6. Stockholder Proposal relating to FOR / / AGAINST / / ABSTAIN / /
conversion from a closed-end fund
to an open-end fund.
DATED , 1995
------------------------------------------------
-------------------------------------------------------------
Signature
-------------------------------------------------------------
Signature (if jointly held)
Please sign exactly as your name(s) appear(s) on this proxy(ies).
Only one signature is required in case of a joint account. When
signing in a representative capacity, please give title.
YOUR VOTE IS IMPORTANT. PLEASE COMPLETE, SIGN AND RETURN THIS CARD AS SOON AS
POSSIBLE. MARK EACH VOTE WITH AN X IN THE BOX.
