sec document
SCHEDULE 14A
(RULE 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE SECURITIES EXCHANGE ACT OF 1934
(AMENDMENT NO. )
Filed by the Registrant /_/
Filed by a Party other than the Registrant /X/
Check the appropriate box:
/_/ Preliminary Proxy Statement
/_/ Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
/_/ Definitive Proxy Statement
/X/ Definitive Additional Materials
/_/ Soliciting Material Under Rule 14a-12
TRI-CONTINENTAL CORPORATION
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(Name of Registrant as Specified in Its Charter)
WESTERN INVESTMENT HEDGED PARTNERS L.P.
WESTERN INVESTMENT LLC
WESTERN INVESTMENT ACTIVISM PARTNERS LLC
WESTERN INVESTMENT TOTAL RETURN MASTER FUND LTD
BENCHMARK PLUS INSTITUTIONAL PARTNERS, L.L.C.
BENCHMARK PLUS PARTNERS, L.L.C.
BENCHMARK PLUS MANAGEMENT, L.L.C.
PARADIGM PARTNERS, N.W., INC.
ARTHUR D. LIPSON
SCOTT FRANZBLAU
ROBERT FERGUSON
MICHAEL DUNMIRE
PAUL DEROSA
DAVID B. FORD
ELYSE NAKAJIMA
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(Name of Persons(s) Filing Proxy Statement, if Other Than the Registrant)
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/X/ No fee required.
/_/ Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and
0-11.
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pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
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/_/ Fee paid previously with preliminary materials:
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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.
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(4) Date Filed
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Western Investment Hedged Partners L.P. together with the other
Participants (as defined below) ("Western Investment") is filing materials
contained in this Schedule 14A with the Securities and Exchange Commission
relating to the definitive proxy statement and accompanying proxy cards filed
with the Securities and Exchange Commission on August 22, 2006 and to be used in
connection with the special meeting of stockholders of Tri-Continental
Corporation (the "Company") scheduled to be held on September 28, 2006 (the
"special meeting") to solicit votes in support of the election of Western
Investment's slate of director nominees and against certain of the Company's
proposals at the special meeting. Western Investment urges stockholders to read
its definitive proxy statement because it contains important information.
Item 1: On or about September 12, 2006, Western Investment mailed the
following letter to stockholders of the Company:
September 12, 2006
Dear Fellow Stockholder:
THE UPCOMING SPECIAL MEETING OF TRI-CONTINENTAL CORPORATION IS YOUR OPPORTUNITY
TO ELECT TRULY INDEPENDENT DIRECTORS.
WHO DO YOU TRUST?
OUR INDEPENDENT NOMINEES OR SELIGMAN'S HAND-PICKED SLATE?
Enron, Worldcom and Tyco. Option timing investigations. Corporate boards have
too often failed to prevent and/or disclose abuses. Whom do you want to entrust
with the future oversight of your investment dollars? It's not a rhetorical
question, especially for Tri-Continental investors. In our opinion, the value of
your shares may depend upon it.
WHAT IS SELIGMAN TRYING TO COVER UP? J. & W. Seligman & Co. Incorporated
("Seligman"), Tri-Continental's investment manager, is currently under
investigation by both the United States Securities and Exchange Commission and
the Office of the Attorney General of the State of New York. The Attorney
General's Office has been forced to go to state court to obtain documents and
information from Seligman relating to its inquiry into trading practices
involving the Seligman group of funds. Separately, in an attempt to block the
Attorney General's Office on procedural grounds, Seligman has filed suit in
federal court seeking to stop the Attorney General's Office from pursuing its
inquiry as to the advisory fees paid by the Seligman group of funds to Seligman.
WHAT IS SELIGMAN HIDING? AS MORNINGSTAR RECENTLY NOTED, "WHEN ANY FIRM IS
EMBROILED IN A TOE-TO-TOE SHOWDOWN WITH BOTH THE SEC AND A STATE ATTORNEY
GENERAL, THAT CASTS A DARK CLOUD OF UNCERTAINTY OVER SAID FIRM."
PENDING INVESTIGATION: Seligman has already made payments to affected open-end
funds in the amount of approximately $2 million and briefly modestly reduced the
management fee it charges another fund in connection with its "market timing"
activities. The Attorney General believes this "restitution" to be wholly
inadequate, and that the "dilution" these activities caused to be "over $80
million". THE ACTIVITIES IN QUESTION WOULD HAVE PROFITED SELIGMAN AND
PARTICULARLY MR. MORRIS, OWNER OF APPROXIMATELY 75% OF SELIGMAN, BY INCREASING
ITS MANAGEMENT FEE INCOME - BUT WOULD HAVE HURT HOLDERS BY INCREASING
TRANSACTION EXPENSES AND MANAGEMENT OVERHEAD, THUS IMPACTING INVESTMENT
PERFORMANCE.
MORNINGSTAR "F" RATING: Morningstar, the well-respected rating company for
mutual funds, recently rated the Seligman family of open-end mutual funds with
an "F" for corporate governance, the lowest possible grade. Morningstar noted
that Seligman's communications to shareholders have been "largely superficial
and haven't been as timely as they could have been." Morningstar recommended
that investors "proceed with caution" concerning an investment in Seligman
open-end mutual funds.
INDEPENDENCE: ASK YOURSELF WHY THE TRI-CONTINENTAL BOARD IS SPENDING MILLIONS OF
DOLLARS OF YOUR MONEY TO STOP INDEPENDENT DIRECTORS FROM JOINING THE BOARD? Our
nominees are COMPLETELY INDEPENDENT of Seligman and Mr. Morris. As directors, we
would have a fiduciary duty to put the interests of Tri-Continental stockholders
first - not the interest of its money manager Seligman or anyone else. We are
professionals who have each achieved remarkable success in our fields. We did
not do so by cutting ethical corners, and we certainly have no reason to start
now.
IS SELIGMAN TRYING TO ENTRENCH ITSELF? If the quorum is lowered to one-third
(1/3) of all of the votes entitled to be cast, as the Tri-Continental board has
proposed in proposal no. 2 at the Special Meeting, directors might be elected
and important proposals passed by stockholders holding as few as 17% of the
votes entitled to be cast. We believe that this threshold is just too low. If
management does not have the support of more than 17% of the votes entitled to
be cast, then we do not believe an action should be approved. It is too easy for
management to get its way by courting a minority of stockholders who share its
views, leading to a possible perpetuation of bad policies without true
stockholder representation.
EXPERIENCE: WHY IS TRI-CONTINENTAL'S BOARD AFRAID TO HAVE EXPERIENCED MONEY
MANAGERS ON ITS BOARD. COULD IT BE THAT EXPERIENCED MONEY MANAGERS WOULD NOT
TOLERATE SELIGMAN'S PERFORMANCE FOR TRI-CONTINENTAL? The current board does not
have a single member with professional investment money management experience
outside of the Seligman boardroom. Mr. Morris WAS with Lehman Brothers years
ago, but did not serve as an investment manager. Our nominees, on the other
hand, together have over 58 years of hands-on investment management and/or
investment research experience - experience and achievement at the highest
levels of the industry:
o PAUL DEROSA: 24 YEARS PROFESSIONAL INVESTMENT MANAGEMENT EXPERIENCE.
Former head of capital markets and financial derivatives business for
Citibank. Managed Citibank's own bond portfolio. Currently senior
investment principal with Mt. Lucas Management Corp., overseeing
investments for institutional and high-net-worth investors.
o DAVID B. FORD: 11 YEARS PROFESSIONAL INVESTMENT MANAGEMENT EXPERIENCE.
Co-head of Goldman Sachs Asset Management, one of the world's most
successful and highly respected investment management organizations,
with over $200 billion under management. Former General Partner and
Managing Director of Goldman Sachs & Co.
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o ART LIPSON: 23 YEARS PROFESSIONAL INVESTMENT MANAGEMENT AND INVESTMENT
RESEARCH EXPERIENCE. Created the Lehman Bond Index, a measurement tool
routinely used by fiduciaries the world over. You might call it the Dow
Jones Industrial Average of the fixed income sector.
The Seligman nominees, on the other hand, can point only to their service with
Seligman for relevant "experience."
CONTINUED POOR PERFORMANCE: Tri-Continental's Net Asset Value return has
underperformed the S&P 500 index in 12 of the last 15 years, as well as in 2006
to date. Regardless of all of the recent statements by Mr. Morris attempting to
demonstrate improved performance, the results speak for themselves,
Tri-Continental's 2006 performance continues to lag the S&P 500 index. For 2006,
returns through September 8, 2006 were as follows:
S&P 500 Index 5.49%
Tri-Continental 5.02%
RESPONSIBILITY: Tri-Continental stockholders both deserve and require a strong
and independent presence on the Seligman-dominated board to see that it fully
protects their interests. Our campaign is about proper governance, not control
of the company; about responsible representation, not some corporate
sleight-of-hand. We have no intention of open-ending or liquidating the fund. We
wish to see Tri-Continental perform well. We want it to prosper, and are willing
to expend our talents, time and energy to see that it does.
SHOULDN'T THERE BE A WATCHDOG ON THE BOARD PROTECTING THE
STOCKHOLDERS' INTERESTS?
ELECT OUR INDEPENDENT SLATE
VOTE AGAINST THE CHARTER AMENDMENT
WE BELIEVE THE CHOICE IS CLEAR -- VOTE THE GOLD PROXY TODAY
You can help us in this effort by voting your GOLD proxy today. Simply follow
the instructions on your GOLD proxy to vote by phone or internet, or sign, date
and return it in the envelope provided today.
Thank you for your support.
Sincerely,
Art Lipson
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IMPORTANT - TIME IS SHORT
VOTE YOUR SHARES TODAY!
There are only a few short days remaining before the Special Meeting. We urge
you to vote your GOLD proxy today by internet or phone by following the
instructions on the enclosed GOLD proxy card. ONLY YOUR LATEST DATED VOTE WILL
BE COUNTED, AND EVEN IF YOU HAVE ALREADY SENT IN A PROXY FOR MANAGEMENT, YOU
HAVE EVERY RIGHT TO CHANGE YOUR VOTE!
If you have any questions or require assistance in voting your shares, please
contact Innisfree M&A, Incorporated, which is assisting us, at 877-456-3510.
(Banks and Brokers may call collect: 212-750-5833).
FOR MORE INFORMATION, VISIT WWW.FIXMYFUND.COM
The website HTTP://WWW.FIXMYFUND.COM was updated to include a link to the above
letter.
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