Institutional Shareholder Services Recommends Shareholders of Salomon Brothers Capital and Income Fund Vote For the New Manageme
October 12 2005 - 1:13PM
Business Wire
Salomon Brothers Capital and Income Fund Inc. (NYSE: SCD) today
announced that Institutional Shareholder Services (ISS), the
nation's leading independent proxy voting advisory firm, has issued
an analysis and opinion recommending that shareholders vote in
favor of a new management agreement with Salomon Brothers Asset
Management Inc (SBAM), to take effect upon the completion of Legg
Mason's purchase of Citigroup's asset management business. ISS's
voting analyses and recommendations are relied upon by more than
1,500 major institutional investment funds, mutual funds, and
fiduciaries. ISS made its recommendation after considering the
efforts and arguments by Karpus Investment Management to solicit
votes against approval of the management agreement. In its report,
ISS notes that: "SBAM has performed well as investment advisor,
leading to strong returns for shareholders over the years. The
board is also carefully monitoring any discount, but it will not
seek the discount's elimination at the expense of long-term
shareholders. A vote against this proposal may create significant
uncertainty for the fund and its shareholders. ISS does not believe
that this is the proper means to narrow the discount." The report
continued, "Furthermore, the fund's closed-end structure is a
fundamental component of the fund's investment objective and is
critical to its successful implementation. In conclusion, ISS
believes that long-term investors, presumably the majority of
shareholders, can still benefit from this fund's overall
performance." "The Board is pleased that ISS has recognized the
compelling reasons for approving the new management agreement,"
said R. Jay Gerken, Chairman of the Board. "Acting in the interests
of all Fund shareholders, the Fund's Board has approved, and
recommended that shareholders vote for approval of the new
agreement, using the white proxy card they have received from the
Fund." "Under SBAM's management, the Fund has outperformed its
benchmark, the Standard & Poor's 500 Index based on net asset
value, for the one-year period ended August 31, 2005, according to
Lipper Analytical Services," continued Mr. Gerken. "Furthermore,
the Fund will be aligned with an organization with an excellent
reputation, focused solely on asset management following completion
of the Legg Mason transaction. Legg Mason has a strong record of
long-term performance in asset management." As of May 31, 2005, 98%
of Legg Mason's open- and closed-end mutual fund assets had beaten
their Lipper category averages over ten years, according to Lipper
Analytical New Applications (excluding money market funds). The
Fund's Directors, including all Independent Directors, approved a
new management agreement between SBAM and the Fund, following the
announcement of Citigroup's intention to sell its asset management
business to Legg Mason, in exchange for Legg Mason's broker-dealer
business and other consideration. The Legg Mason transaction is
expected to be completed by Citigroup in the fourth quarter of this
year, at which time the new management agreement is intended to
become effective. Shareholders can vote for approval of the new
agreement by using the white proxy card they received in the mail
from the Fund. If shares are held in a brokerage account, a broker
can vote for the shareholder only if the broker has been instructed
to do so by the shareholder. Shareholders can give their brokers
instructions simply by signing and dating the white proxy card
provided by the Fund and returning it in a postage-paid envelope
provided to them or by following the instructions for phone or
Internet voting on the proxy card. Shareholders need not contact
their brokers directly. Shareholders may obtain a white proxy card
and return envelope by calling 1-888-293-6728. Salomon Brothers
Capital and Income Fund Inc., a non-diversified investment
management company, is managed by SBAM, an indirect wholly owned
subsidiary of Citigroup Inc. For more information, call
1-888-777-0102 or 1-800-SALOMON, or consult the Fund's web site at
www.citigroupam.com. Please note that past performance does not
guarantee future results. Investment return and principal value of
a fund will fluctuate. Current performance may be lower or higher
than the performance data quoted.
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