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
Filed by the Registrant |X|
Filed by a Party other than the Registrant |_|
Check the appropriate box:
|_| Preliminary Proxy Statement |_| Confidential, For Use of the
Commission Only (as
|X| Definitive Proxy Statement permitted by Rule 14a-
6(e)(2))
|_| Definitive Additional Materials
|_| Soliciting Material Under Rule 14a-12
Blue Chip Value Fund, Inc.
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(Name of Registrant as Specified In Its Charter)
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(Name of Person(s) Filing Proxy Statement, if Other Than the Registrant)
Payment of Filing Fee (Check the appropriate box):
|X| No fee required.
|_| Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
(1) Title of each class of securities to which transaction applies:
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(2) Aggregate number of securities to which transaction applies:
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(3) Per unit price or other underlying value of transaction computed pursuant to
Exchange Act Rule 0-11 (set forth the amount on which the filing fee is
calculated and state how it was determined):
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(4) Proposed maximum aggregate value of transaction:
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(5) Total fee paid:
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|_| Fee paid previously with preliminary materials:
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|_| 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:
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(2) Form, Schedule or Registration Statement No.:
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(3) Filing Party:
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(4) Date Filed:
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-2-
BLUE CHIP VALUE FUND, INC.
1225 Seventeenth Street
26th Floor
Denver, Colorado 80202
Denver, Colorado
April 8, 2004
To Our Stockholders:
It is our pleasure to invite you to your Fund's Annual Meeting of
Stockholders to be held at the offices of Denver Investment Advisors LLC
("DIA"), 1225 Seventeenth Street, 26th Floor, Denver, Colorado, on Tuesday, May
11, 2004, at 12:00 noon (Mountain time). Formal notice of the meeting appears on
the next page and is followed by the Proxy Statement.
We hope you will find it convenient to attend, but we urge you, in any
event, to complete and return the enclosed proxy card in the envelope provided.
You may also choose to cast your vote by telephone, instead of by mail. If you
do attend, you may vote in person if you so desire.
The Annual Report of the Blue Chip Value Fund, Inc. for the year ended
December 31, 2003 has previously been mailed to stockholders of record. It is
enclosed with this mailing to beneficial owners of the Fund's stock who may not
have previously received it. The Annual Report is not to be considered proxy
soliciting material.
Sincerely,
/s/ Todger Anderson, CFA
------------------------
Todger Anderson, CFA
President
YOUR VOTE IS IMPORTANT
We consider the vote of each Stockholder important, whatever the number
of shares held. If you are unable to attend the meeting in person, please sign,
date, and return your proxy in the enclosed envelope or you may cast your vote
by telephone at your earliest convenience. The prompt voting of your proxy will
save expense to your Fund.
BLUE CHIP VALUE FUND, INC.
1225 Seventeenth Street
26th Floor
Denver, Colorado 80202
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
Denver, Colorado
April 8, 2004
To the Stockholders of
Blue Chip Value Fund, Inc.:
The Annual Meeting of Stockholders of Blue Chip Value Fund, Inc. (the
"Fund") will be held at the offices of Denver Investment Advisors LLC, 1225
Seventeenth Street, 26th Floor, Denver, Colorado, on Tuesday, May 11, 2004, at
12:00 noon (Mountain time), for the following purposes:
1. To elect two (2) Class I directors to serve until the Annual
Meeting of Stockholders in the year 2007 and until the
election and qualification of their successors.
2. To transact such other business as may properly come before
the meeting or any adjournment thereof.
The subjects referred to above are discussed in the Proxy Statement
attached to this Notice. Each Stockholder is invited to attend the Annual
Meeting in person. Holders of record at the close of business on March 23, 2004
are entitled to receive notice of and to vote at the Meeting. If you cannot be
present at the Annual Meeting, we urge you to fill in, sign, and promptly return
the enclosed proxy in the envelope provided, which is addressed for your
convenience and needs no postage if mailed in the United States. You may also
choose to cast your vote by telephone, instead of by mail. In order to avoid the
additional expense to the Fund of further solicitation, we ask your cooperation
in completing your proxy promptly.
/s/ W. Bruce McConnel
---------------------
W. Bruce McConnel
Secretary
ANNUAL MEETING OF STOCKHOLDERS
OF
BLUE CHIP VALUE FUND, INC.
1225 Seventeenth Street
26th Floor
Denver, Colorado 80202
PROXY STATEMENT
April 8, 2004
This Proxy Statement is furnished in connection with the solicitation
of proxies by the Board of Directors of Blue Chip Value Fund, Inc. (the "Fund")
for use at the Fund's Annual Meeting of Stockholders to be held at the offices
of Denver Investment Advisors LLC, 1225 Seventeenth Street, 26th Floor, Denver,
Colorado, on Tuesday, May 11, 2004, at 12:00 noon (Mountain time), and at any
adjournment thereof (the "Meeting").
You can vote in any one of the following ways:
(a) By mail, by filling out and returning the enclosed proxy card.
(b) By telephone by following the instructions printed on the proxy
card.
(c) In person at the Meeting.
Any person giving a proxy may revoke it at any time prior to its use.
Properly submitted proxies received by the Fund in time for voting and not so
revoked will be voted in accordance with the directions specified therein. The
Board of Directors recommends a vote FOR the election of directors as listed. If
no specification is made, the proxy will be voted for the election of directors
as listed, and with discretionary authority to vote upon such other business as
may properly come before the Meeting or any adjournment thereof.
Costs of soliciting proxies will be borne by the Fund. Morrow & Co.,
Inc. has been retained to solicit proxies in connection with the Meeting for a
fee of approximately $3,000 and reimbursement for all out-of pocket expenses. It
is anticipated that banks, brokerage houses, and other custodians will be
requested on behalf of the Fund to forward solicitation material to their
principals to obtain authorizations for the execution of proxies. In addition to
soliciting proxies
by use of the mail, some of the officers of the Fund and persons affiliated with
Denver Investment Advisors LLC, the Fund's investment adviser, may, without
remuneration, solicit proxies personally or by telephone or telefax. By voting
as soon as you receive your proxy materials, you will help to reduce the cost of
any additional mailings or solicitation efforts.
On March 23, 2004, the record date for determining the Stockholders
entitled to vote at the Meeting, there were outstanding 26,969,486 shares of
common stock, constituting all of the Fund's outstanding voting securities. Each
share of common stock is entitled to one vote. This Proxy Statement, the
accompanying Notice of Annual Meeting of Stockholders and the enclosed proxy are
being mailed on or about April 8, 2004 to Stockholders of record on the record
date.
The Fund will furnish to Stockholders upon request, without charge,
copies of its Annual Report to Stockholders, containing audited financial
statements for the fiscal year ended December 31, 2003. Requests for such Annual
Report should be directed to Mr. Jasper R. Frontz, Treasurer, Blue Chip Value
Fund, Inc., 1225 Seventeenth Street, 26th Floor, Denver, Colorado 80202 or
telephone toll-free (800) 624-4190. The Annual Report is not to be regarded as
proxy soliciting material.
PROPOSAL 1: NOMINEES FOR ELECTION AS DIRECTORS
The Fund's By-Laws provide that the Board of Directors shall consist of
three classes of members. Directors are chosen for a term of three years and the
term of one class of directors expires each year. The Board of Directors has
designated two candidates, who are presently directors of the Fund, for whom
proxies solicited by the Fund will be voted if requisite authority is granted.
Mr. Greenebaum, who has served as a director of the Fund since 1988,
has informed the Board of Directors of his intention to retire at the end of his
term and not stand for re-election. Mr. Greenebaum's decision to retire was not
based upon any disagreement with the Fund's Board of Directors or management.
The following table sets forth the nominees for election as directors
and the other directors whose term of office continues beyond the Meeting, their
ages, term of office, including length of time served as a director, principal
occupations for the past five or more years, any other directorships they hold
in companies which are subject to the reporting requirements of the Securities
Exchange Act of 1934 or are registered as investment companies under the
Investment Company Act of 1940, as amended (the "1940 Act"), and the number of
portfolios in the Fund Complex that they oversee. The Fund Complex includes
funds with a common or affiliated investment adviser. The Fund Complex is
comprised of the Fund, consisting of one portfolio and Westcore Trust, of which
there are ten portfolios. Each director may be contacted by writing to the
director, c/o Blue Chip Value Fund, Inc., 1225 Seventeenth Street, 26th Floor,
Denver, Colorado 80202, Attn: Jasper Frontz.
2
NOMINEES FOR ELECTION - to be elected for a term of three years until the Annual
Meeting in the year 2007.
INTERESTED DIRECTOR
TODGER ANDERSON, CFA*
Age: 59
Position(s) Held with the Fund and Term of Office: Class I Director from 1988
until 1995, and since 1998.** President of the Fund since 1987.
Principal Occupations During Past Five Years: Chairman (since 2004) and
Executive Manager (since 1995), Denver Investment Advisors LLC; President,
Denver Investment Advisors LLC (from 1995 until 2004); prior to 1995, President
and Director of Portfolio Management, Denver Investment Advisors, Inc.;
Portfolio Manager, Westcore MIDCO Growth Fund (since 1986); Portfolio
Co-Manager, Westcore Select Fund (since 2001).
Other Directorships Held: Fischer Imaging Corporation.
Number of Portfolios in Fund Complex Overseen: One.
INDEPENDENT DIRECTOR
GARY P. MCDANIEL
Age: 58
Position(s) Held with the Fund and Term of Office: Class I Director since 2001.
Principal Occupations During Past Five Years: Senior Managing Director, Base
Camp Capital LLC (private equity investing) (since 2003); prior thereto, Chief
Executive Officer, Chateau Communities, Inc. (REIT/manufactured housing)
(1997-2002).
Other Directorships Held: None.
Number of Portfolios in Fund Complex Overseen: One.
OTHER DIRECTORS
INTERESTED DIRECTOR
KENNETH V. PENLAND, CFA*
Age: 61
Position(s) Held with the Fund and Term of Office: Chairman of the Board and
Class III Director since 1987. Term as Director expires in 2006.
Principal Occupations During Past Five Years: Retired; Chairman and Executive
Manager, Denver Investment Advisors LLC (from 1995 until December 2001); prior
thereto Chairman of the Board and Director of Research, Denver Investment
Advisors, Inc.; President, Westcore Trust (from 1995 until August 2002);
Trustee, Westcore Trust (since 2001).
Other Directorships Held: None.
3
Number of Portfolios in Fund Complex Overseen: Eleven.
INDEPENDENT DIRECTORS
ROBERTA M. WILSON, CFA
Age: 60
Position(s) Held with the Fund and Term of Office: Class III Director since
1987. Term as Director expires in 2006.
Principal Occupations During Past Five Years: Retired; Director of Finance,
Denver Board of Water Commissioners, Denver, Colorado (from 1985 until July
1998); Management Consultant and Coach (since 1998).
Other Directorships Held: None.
Number of Portfolios in Fund Complex Overseen: One.
LEE W. MATHER, JR.
Age: 60
Position(s) Held with the Fund and Term of Office: Class II Director since 2001.
Term expires in 2005.
Principal Occupations During the Past Five Years: Director, American Rivers
(conservation organization), Washington, D.C. (since June 2000); Investment
Banker, Merrill Lynch & Co., New York, New York (January 1977 until April 2000).
Other Directorships Held: None.
Number of Portfolios in Fund Complex Overseen: One.
RICHARD C. SCHULTE
Age: 59
Position(s) Held with the Fund and Term of Office: Class II Director since 1987.
Term expires in 2005.
Principal Occupations During the Past Five Years: Private Investor; President,
Transportation Service Systems, Inc. (1993 - 1996); Employee, Southern Pacific
Lines, Denver, Colorado (until 1996); Employee, Rio Grande Industries, Denver,
Colorado (holding company) (1991 - 1993); Vice President Finance and Treasurer,
Rio Grande Holdings, Inc., Denver, Colorado (1990 -1993); and Vice President,
Denver & Rio Grande Western Railroad Company, Denver, Colorado (1990 - 1993).
Other Directorships Held: None.
Number of Portfolios in Fund Complex Overseen: One.
-------------------
* Messrs. Anderson and Penland may be deemed to be "interested persons" of the
Fund, as that term is defined in the 1940 Act, by virtue of their affiliations
with the Fund's investment adviser and their status as officers of the Fund.
**Mr. Anderson previously served as a director of the Fund from May 12, 1988 to
March 31, 1995. Mr. Anderson resigned on March 31, 1995 because of a change in
control of the Fund's investment adviser, and in order to comply with the
provisions of Section 15(f) of the 1940 Act that at least 75% of the directors
of the Fund were required to be disinterested directors for a
4
period of three years following the change in control. Mr. Anderson was
re-elected to the Board of Directors at the 1998 Annual Meeting of Stockholders.
OFFICERS
Information concerning the names, ages, positions with the Fund, term
of office, including length of time served as an officer, current affiliations,
and principal occupations of the principal officers of the Fund, other than
Messrs. Anderson and Penland, is set out below. Information concerning Messrs.
Anderson and Penland is set forth on pages 3-4.
Officers of the Fund are elected by the Board of Directors and, subject
to the earlier termination of office, each officer holds office for the term of
one year and until his or her successor is elected and qualified.
MARK M. ADELMANN, CFA, CPA
1225 Seventeenth Street, 26th Floor, Denver, Colorado 80202
Age: 46.
Position Held with the Fund and Term of Office: Vice President of the Fund since
2002.
Principal Occupations During the Past Five Years: Vice President, Denver
Investment Advisors LLC (since 2000); Research Analyst, Denver Investment
Advisors LLC (since 1995).
W. BRUCE McCONNEL
1 Logan Square, 18th and Cherry Streets, Philadelphia, Pennsylvania 19103
Age: 60.
Position Held with the Fund and Term of Office: Secretary of the Fund since
1987.
Principal Occupations During the Past Five Years: Partner of the law firm of
Drinker Biddle & Reath LLP, Philadelphia, Pennsylvania; Secretary, Westcore
Trust (1985-2003).
JASPER R. FRONTZ, CPA, CFA
1225 Seventeenth Street, 26th Floor, Denver, Colorado 80202
Age: 35.
Position Held with the Fund and Term of Office: Treasurer of the Fund since
1997.
Principal Occupations During the Past Five Years: Vice President, Denver
Investment Advisors LLC (since 2000); Director of Mutual Fund Administration,
Denver Investment Advisors LLC (since 1997); prior thereto, Fund Controller,
ALPS Mutual Funds Services, Inc. (1995-1997); Treasurer, Westcore Trust (since
1997); Registered Representative, ALPS Distributors, Inc. (since 1995).
No director or officer of the Fund who is currently a director,
officer, or employee of the investment adviser or any of its parents, received
any remuneration from the Fund during 2003. The other directors taken as a group
were either paid or had accrued directors' fees for 2003 from the Fund in the
aggregate amount of $78,412.
5
In 2003 the directors received an annual retainer of $6,000 for serving
as directors, plus a meeting fee of $1,500 for each regular Board meeting
attended, including reimbursement for out-of-pocket expenses incurred in
attending Board meetings. The Board of Directors held four regularly scheduled
meetings during the year ended December 31, 2003. Each of the directors attended
every Board meeting. The Fund does not require attendance by Directors at annual
meetings of Stockholders, although Directors are welcome to attend. All of the
Directors attended the 2003 annual meeting of Stockholders.
The following table provides information concerning the compensation of
each of the Fund's directors for services rendered during the Fund's fiscal year
ended December 31, 2003:
Compensation Table
Total
Pension or Compensation
Aggregate Retirement Benefits Estimated From Fund and
Compensation Accrued As Part of Annual Benefits Fund Complex
Name of Person From Fund Fund Expenses Upon Retirement Paid to Directors
-------------- --------- ------------- --------------- -----------------
Interested Directors
Todger Anderson $ -0- $ -0- $ -0- $ -0-
Kenneth V. Penland $12,000 $ -0- $ -0- $27,000(1)
Independent Directors
Robert J. Greenebaum(2) $15,539 $ -0- $ -0- $15,539
Lee W. Mather, Jr. $14,873 $ -0- $ -0- $14,873
Gary P. McDaniel $12,000 $ -0- $ -0- $12,000
Richard C. Schulte $12,000 $ -0- $ -0- $12,000
Roberta M. Wilson $12,000 $ -0- $ -0- $12,000
----------------------
Drinker Biddle & Reath LLP, of which W. Bruce McConnel, Secretary of
the Fund, is a partner, received legal fees during the fiscal year ended
December 31, 2003 for services rendered as the Fund's legal counsel.
----------------------
(1) Includes $15,000 Mr. Penland received as a Trustee of Westcore Trust in
2003.
(2) Mr. Greenebaum's term of office as a Director will cease upon his retirement
on May 11, 2004.
6
Ownership of Fund Shares
The following table sets forth, as of January 31, 2004 beneficial
ownership of the Fund's shares by (1) each director and each nominee for
director and (2) all directors, nominees for director and executive officers as
a group.
Dollar Range
of Equity Number of Shares Percent
Securities Owned Beneficially Owned(1) of Class
Name in the Fund in the Fund in the Fund
---- ----------- ----------- -----------
Interested Directors
Todger Anderson over $100,000 198,094 *
Kenneth V. Penland over $100,000 318,738(2) 1.2%
Independent Directors
Robert J. Greenebaum(3) over $100,000 21,677 *
Lee W. Mather, Jr. over $100,000 33,000 *
Gary P. McDaniel $10,001 - $50,000 2,505 *
Richard C. Schulte $10,001 - $50,000 3,965(4) *
Roberta M. Wilson $10,001 - $50,000 4,899(5) *
All directors and
executive officers and nominees
for director as a group 582,878 2.2%
--------------------------
(1) Unless otherwise indicated the beneficial owner has sole voting and
investment power.
(2) Including 93,552 shares held by Mr. Penland, 127,121 shares owned by
Mr. Penland's wife, 34,561 shares jointly owned by Mr. Penland and his
wife, and 63,504 shares owned in a trust for Mr. Penland's daughter.
(3) Mr. Greenbaum's term of office as a Director will cease upon his
retirement on May 11, 2004.
(4) These shares include 2,772 that are owned by Mr. Schulte's wife.
(5) These shares are owned jointly by Ms. Wilson and her husband.
* Less than 1%.
To the knowledge of the Fund's management, no person owns beneficially
more than 5% of the Fund's outstanding shares as of March 23, 2004.
7
Standing Board Committees
The Board has established three standing committees in connection with
the governance of the Fund: Audit, Qualified Legal Compliance and Nominating.
The Fund's Audit Committee is comprised of all of the directors of the
Fund who are not "interested" persons of the Fund as defined in the 1940 Act.
The members of the Audit Committee are also considered independent as defined in
the New York Stock Exchange Listing Standards applicable to closed-end
investment companies. The functions of the Audit Committee include, among other
things, to meet with the Fund's independent auditors to review the scope and
findings of the annual audit, review matters of independence, discuss the Fund's
accounting policies, discuss any recommendation of the independent auditors with
respect to the Fund's management practices, review the impact of changes in
accounting standards upon the Fund's financial statements, approve all audit and
permissible non-audit services provided to the Fund and certain other persons by
the independent auditors, approve the selection and compensation of independent
auditors, and perform such other duties as may be assigned to the Audit
Committee by the Board of Directors. The Board adopted a written charter for the
Audit Committee in February 2000. The Audit Committee met once during the fiscal
year ended December 31, 2003.
The Audit Committee has met with Fund management to review and discuss,
among other things, the Fund's audited financial statements for the year ended
December 31, 2003. The Audit Committee has also met with the Fund's independent
accountants and discussed with them certain matters required under SAS 61
(Codification of Statements on Auditing Standards, AU ss. 380) as may be
modified or supplemented from time to time, including, but not limited to, the
scope of the Fund's audit, the Fund's financial statements and the Fund's
accounting controls. The Audit Committee has received written disclosures and
the letter from the Fund's independent accountants required by Independence
Standards Board Standard No. 1 (Independence Discussions with Audit Committees),
as may be modified or supplemented from time to time, and has discussed with the
independent accountants their independence. Based upon these reviews and
discussions, the Audit Committee recommended to the Board of Directors that the
Fund's audited financial statements be included in the Fund's 2003 Annual Report
to Stockholders for the year ended December 31, 2003. The members of the Audit
Committee are currently Messrs. Greenebaum, Mather, McDaniel and Schulte, and
Ms. Wilson.
The Audit Committee also serves as the Fund's Qualified Legal
Compliance Committee (the "QLCC"). The purpose of the QLCC is to receive,
retain, consider and act upon reports of evidence of possible material
violations of applicable United States federal and state securities laws,
material breaches of fiduciary duty arising under United States federal or state
law and similar violations of any United States federal or state law from
attorneys covered by Section 307 of the Sarbanes-Oxley Act of 2002. There were
no meetings of the QLCC during the fiscal year ended December 31, 2003.
The Fund's Nominating Committee is comprised of all of the Directors
who are not "interested" persons of the Fund, as defined in the 1940 Act. The
members of the Nominating Committee are currently Messrs. Greenebaum, Mather,
McDaniel and Schulte, and Ms. Wilson.
8
The Nominating Committee is responsible for the selection and nomination of
candidates to serve as directors. A copy of the Nominating Committee Charter is
attached hereto as Appendix A.
In evaluating candidates, the Nominating Committee may consider a
variety of factors, but it has not at this time set any specific minimum
qualifications that must be met. Although the Nominating Committee expects to be
able to find an adequate number of candidates to serve as directors, the
Nominating Committee is willing to consider nominations received from
Stockholders or from other sources it deems appropriate that are submitted
timely and with adequate information about the candidate in the Committee's view
in order for it to make an assessment. The Nominating Committee shall assess
stockholder nominees in the same manner as it reviews its own nominees. Any
recommendation must be submitted in writing to the Nominating Committee in care
of the Fund's Treasurer at the address on the front of this Proxy Statement, and
should include at a minimum the following information as to each individual
proposed for nomination as director: such individual's written consent to be
named in the proxy statement as a nominee (if nominated) and to serve as a
director (if elected), and all information relating to such individual that is
required to be disclosed in the solicitation of proxies for election of such
proposed nominee under the Securities Exchange Act of 1934, as amended, and the
1940 Act. The Nominating Committee, in its discretion, may request additional
information concerning the recommended candidate in order to evaluate the
candidate's qualifications. This Proxy Statement is expected to be mailed on
April 8, 2004, and, if such occurs, any such notice must be received by the Fund
on or before April 18, 2004.
In order for the information on such nominee to be considered for
inclusion in the Fund's proxy statement, any such submission must be sent no
later than 120 calendar days before the date the Fund's proxy statement was
released to stockholders in connection with the Fund's previous year's annual
meeting or, if the Fund has changed the meeting date by more than 30 days,
within a reasonable time before the Fund begins to print and mail its proxy
statement. The Nominating Committee did not meet during the fiscal year ended
December 31, 2003. No nominee recommendation has been received from a
Stockholder within the past 120 days. The Fund has not paid a fee to third
parties to assist in finding nominees.
Stockholders may send other communications to the Board of Directors, a
committee thereof or an individual Director. Any such communication should be
sent in writing addressed to the Board of Directors, the specific committee or
individual Director in care of the Fund's Treasurer at the address on the front
of this Proxy Statement. The Fund's Treasurer is responsible for determining, in
consultation with other officers of the Fund, counsel and other advisers, as
appropriate, which stockholder-communications will be relayed to the Board,
committee or individual Director. The Treasurer may determine not to forward any
letter to the Board, committee or individual Director that does not relate to
the business of the Fund.
Section 16(a) Beneficial Ownership Reporting Compliance
Section 30(f) of the 1940 Act and Section 16(a) of the Securities
Exchange Act of 1934 require the Fund's directors and officers, certain
affiliated persons of the investment adviser, and persons who own more than ten
percent of the Fund's shares to file with the Securities and
9
Exchange Commission and the New York Stock Exchange initial reports of ownership
and reports of changes in ownership of shares of the Fund. Specific due dates
for these reports have been established and the Fund is required to disclose in
this Proxy Statement any failure to file by the specific due dates. To the
Fund's knowledge, all of these filing requirements were satisfied during 2003,
except as follows: Ms. Suzanne Quam, an affiliated person of the investment
adviser, did not file on a timely basis one report on Form 3 relating to her
initial statement of beneficial ownership and two reports on Form 4 relating to
two transactions; each of the following affiliated persons of the investment
adviser did not file on a timely basis one report on Form 3 relating to his
initial statement of beneficial ownership: Derek R. Anguilm, Glen T. Cahill,
Troy Dayton, Jeffrey D. Adams, William S. Chester, Kris B. Herrick and Alex W.
Lock. In making these disclosures, the Fund has relied on copies of reports that
were furnished to it and written representations of its directors, officers and
investment adviser.
Relationship with Independent Public Accountants
Pursuant to Rule 32a-4 of the 1940 Act, the Fund is no longer required
to submit the ratification of the selection of its accountants to Stockholders.
The Audit Committee and the Board on February 17, 2004, re-appointed Deloitte &
Touche LLP ("Deloitte & Touche") as the Fund's independent auditors for the
fiscal year ending December 31, 2004. Deloitte & Touche has served as the Fund's
independent auditors since the fiscal year ended December 31, 2000.
Independent Auditor's Fees
Audit Fees: For the Fund's fiscal years ended December 31, 2003 and
December 31, 2002, the aggregate fees billed for professional services rendered
by Deloitte & Touche for the audit of the Fund's annual financial statements
were $16,430 for each year.
Audit-Related Fees: In Fund's fiscal years ended December 31, 2003 and
December 31, 2002, no fees were billed for assurance and related services by
Deloitte & Touche that were reasonably related to the performance of the audit
of the Fund's financial statements and are not reported under "Audit Fees"
above.
Tax Fees: For the Fund's fiscal years ended December 31, 2003 and
December 31, 2002, aggregate fees of $7,786 and $6,070, respectively, were
billed for professional services rendered by Deloitte & Touche for tax
compliance, tax advice, and tax planning. The fiscal year 2003 tax fees were for
tax return preparation services and assistance with research, advice and
inquiries to taxing authorities concerning certain tax regulations for the Fund.
The fiscal year 2002 tax fees were for tax return preparation services for the
Fund.
All Other Fees: For the Fund's fiscal year ended December 31, 2002,
aggregate fees of $1,000 were billed by Deloitte & Touche for a reading of the
Fund's unaudited semi-annual financial statements. No fees were billed to the
Fund by Deloitte & Touche for services other than the services reported under
the captions "Audit Fees," "Audit-Related Fees" and "Tax Fees," above, for the
Fund's fiscal year ended December 31, 2003.
10
Audit Committee Pre-Approval Policies and Procedures: The Fund's Audit
Committee has not adopted pre-approval policies and procedures. Instead, the
Audit Committee approves on a case-by-case basis each audit or non-audit service
before the engagement.
Aggregate non-audit fees of $31,286 were billed by Deloitte & Touche
for services rendered to the Fund and to the Fund's investment adviser, Denver
Investment Advisors, LLC ("DIA"), for the Fund's fiscal year ended December 31,
2003. Aggregate non-audit fees of $30,570 were billed by Deloitte & Touche for
services rendered to the Fund and to DIA for the Fund's fiscal year ended
December 31, 2002. The non-audit services rendered to DIA were not required to
be pre-approved by the Fund's Audit Committee because they were provided prior
to May 6, 2003, the effective date of the rules requiring such pre-approval. The
Audit Committee has considered whether the provision of non-audit services that
were rendered to DIA that were not pre-approved is compatible with maintaining
Deloitte & Touche's independence.
Representatives of Deloitte & Touche are not expected to be present at
the Meeting, but will be available by telephone to respond to appropriate
questions from Stockholders, if necessary.
The Board of Directors recommends that Stockholders vote FOR the
election of Messrs. Anderson and McDaniel as Class I directors to serve until
the Annual Meeting of Stockholders in the year 2007 and until the election and
qualification of their successors.
VOTES REQUIRED FOR THE ELECTION OF DIRECTORS AND
APPROVAL OF OTHER MATTERS AT THE MEETING
A quorum for the transaction of business at the Meeting is constituted
by the presence in person or by proxy of holders of a majority of the
outstanding shares of common stock of the Fund. If a Proxy is properly submitted
accompanied by instructions to withhold authority, or is marked with an
abstention, the shares represented thereby will be considered to be present at
the Meeting for purposes of determining the existence of a quorum for the
transaction of business. In the election of directors, the nominees receiving
the highest number of votes cast at the Meeting will be elected, assuming that
each receives the votes of a majority of the outstanding shares of common stock.
The withholding of voting authority with respect to the election of a director
means that the shares withheld will not be counted toward the required majority.
Under Maryland law, abstentions will have the effect of a "no vote" for purposes
of obtaining the requisite approval. Broker "non-votes" will be treated the same
as abstentions.
In the event that a quorum is not present at the Meeting or at any
adjournment thereof, or in the event that a quorum is present at the Meeting but
sufficient votes to approve the proposal are not received by the Fund, one or
more adjournment(s) may be proposed to permit further solicitations of proxies.
Any adjourned session or sessions may be held after the date set for the
original Meeting without notice except announcement at the Meeting. Any such
adjournment(s) will require the affirmative vote of a majority of the
outstanding shares of common stock that are represented at the Meeting in person
or by proxy. If such a quorum is present, the persons named as proxies will vote
those proxies which they are entitled to vote FOR the proposal in
11
favor of such adjournment(s), and will vote those proxies required to be voted
AGAINST the proposal against any such adjournment(s).
OTHER BUSINESS
The Management of the Fund does not know of any other matters to be
brought before the Meeting. If such matters are properly brought before the
Meeting, proxies not limited to the contrary will be voted in accordance with
the best judgment of the person or persons acting thereunder. To propose any
business for consideration at this Meeting (other than matters included in this
Proxy Statement), the By-Laws require a Stockholder to notify the Fund in
writing by the tenth day following the day on which notice of the meeting is
mailed and to provide such written information to the Fund as its Secretary may
reasonably require. This Proxy Statement is expected to be mailed to
Stockholders on April 8, 2004, and, if such occurs, any such notice must be
received by the Fund on or before April 18, 2004.
ADDITIONAL INFORMATION
Investment Adviser
DIA is located at 1225 Seventeenth Street, 26th Floor, Denver, CO
80202.
Co-Administrators
DIA and ALPS Mutual Funds Services, Inc. ("ALPS") serve as
co-administrators for the Fund. ALPS is located at 1625 Broadway, Suite 2200,
Denver, CO 80202.
Stockholder Proposals - Annual Meeting in the Year 2005
A Stockholder who intends to present a proposal which relates to a
proper subject for Stockholder action at the Annual Meeting of Stockholders in
the year 2005, and who wishes such proposal to be considered for inclusion in
the Fund's proxy materials for such meeting, must cause such proposal to be
received, in proper form, at the Fund's principal executive offices no later
than November 30, 2004. Any such proposals, as well as any questions relating
thereto, should be directed to the Fund to the attention of its President.
April 8, 2004
Stockholders who do not expect to be present at the Meeting and who wish to have
their shares voted are requested to date and sign the enclosed proxy and return
it in the enclosed envelope. No postage is required if mailed in the United
States. You may also choose to cast your vote by telephone, instead of by mail.
12
Appendix A
BLUE CHIP VALUE FUND, INC.
NOMINATING COMMITTEE CHARTER
SECTION 1. PURPOSE & SCOPE
The Board of Directors (the "Board") of Blue Chip Value Fund, Inc. (the
"Fund") has established a Nominating Committee (the "Committee") that is
responsible for recommending to the Board persons to be nominated by the Board
for election as Directors at the Fund's meetings of stockholders or to fill any
vacancy on the Board that may arise between meetings of stockholders.
SECTION 2. MEMBERSHIP
The Committee consists of all of the Directors who are not "interested
persons" of the Fund, as defined in the Investment Company Act of 1940, as
amended (the "1940 Act"). The Board of Directors shall elect a Chairperson of
the Committee by a majority vote. The compensation, if any, of the Committee
members shall be as determined by the Board.
SECTION 3. NOMINATION AND APPOINTMENT POLICY AND RESPONSIBILITIES
(a) In evaluating candidates, the Committee shall take into
consideration such factors as it deems appropriate. The Committee may, in its
discretion, establish specific, minimum qualifications or skills that must be
met by candidates.
(b) The Committee will consider candidates submitted by stockholders or
from other sources it deems appropriate that are submitted timely and with
adequate information about the candidate in the Committee's view in order for
them to make an assessment. The Committee shall assess stockholder nominees in
the same manner as it reviews its own nominees. Any recommendation must be
submitted in writing to the Committee in care of the Fund's Treasurer at Denver
Investment Advisors, LLC, 1225 Seventeenth Street, 26th Floor, Denver, Colorado
80202, and should include at a minimum the following information as to each
individual proposed for nomination as director: such individual's written
consent to be named in the proxy statement as a nominee (if nominated) and to
serve as a director (if elected), and all information relating to such
individual that is required to be disclosed in the solicitation of proxies for
election of such proposed nominee under the Securities Exchange Act of 1934, as
amended, and the Investment Company Act of 1940, as amended. The Committee, in
its discretion, may request additional information concerning the recommended
candidate in order to evaluate the candidate's qualifications.
To be timely for consideration by the Committee, in accordance with the
Fund's By-Laws, the Fund must be notified of the name of the candidate in
writing at least 60 days prior to the annual meeting and the remaining required
written information must be submitted at least 30 days prior to the annual
meeting, provided however, in the event that the notice of the annual meeting of
stockholders is mailed less than 60 days before the annual meeting date, then
the name of the candidate and the required written information must be received
by the Fund by the tenth day following the day on which the notice of the annual
meeting is mailed to stockholders or otherwise publicly disclosed. In order for
the information on such nominee to be considered for inclusion in the Fund's
proxy statement, any such submission must be sent no later than 120 calendar
days before the date the Fund's proxy statement was released to stockholders in
connection with the Fund's previous year's annual meeting or, if the Fund has
changed
A-1
the meeting date by more than 30 days, within a reasonable time before the Fund
begins to print and mail its proxy statement.
SECTION 4. ADDITIONAL RESPONSIBILITIES
(a) The Committee shall have the authority to delegate all or a portion
of its duties and responsibilities to a subcommittee of the Committee or to a
Committee member.
(b) The Committee shall have any other duties or responsibilities
expressly delegated to the Committee by the Board from time to time relating to
the nomination of the Board members or any Committee members.
SECTION 5. PROCEDURAL MATTERS
(a) The Committee shall meet as often as it deems necessary. At all
meetings of the Committee, a majority of the members of the Committee shall
constitute a quorum for the transaction of business.
(b) The Committee shall keep written minutes of its meetings, which
minutes shall be maintained with the books and records of the Fund, and the
Committee shall report all of its actions to the Board at its next meeting
following such actions.
(c) The Committee shall review and reassess the adequacy of this
Charter as frequently as it deems necessary and recommend any proposed changes
to the Board for approval.
(d) The Committee shall have the resources and authority to make
reasonable expenditures, including expenditures to retain any experts and
counsel related to the aforementioned duties and tasks, including a professional
search firm to identify potential candidates that will be reimbursed by the
Fund.
Adopted as of March 16, 2004
A-2
Appendix B
FORM OF PROXY CARD
BLUE CHIP VALUE FUND, INC.
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS OF BLUE CHIP VALUE
FUND, INC. (THE "FUND") FOR USE AT THE ANNUAL MEETING OF STOCKHOLDERS TO BE HELD
ON MAY 11, 2004 AT 12:00 NOON AT THE OFFICES OF DENVER INVESTMENT ADVISORS LLC,
1225 SEVENTEENTH STREET, 26TH FLOOR, DENVER, COLORADO.
The undersigned hereby appoints Margaret R. Jurado and Jeffrey D. Adams, and
each of them, with full power of substitution, as proxies of the undersigned to
vote at the above-stated Annual Meeting, and all adjournments thereof, all
shares of common stock held of record by the undersigned on the record date for
the Meeting, upon the following matters, and upon any other matter which may
properly come before the Meeting and at any adjournment thereof, at their
discretion.
(Please date and sign on reverse side)
Address Change/Comments (Mark the corresponding box on the reverse side)
--------------------------------------------------------------------------------
FOLD AND DETACH HERE
YOUR VOTE IS IMPORTANT
You can vote in one of two ways;
1. Mark, sign and date your proxy card and return it promptly in the enclosed
envelope.
or
2. Call toll free 1-800-435-6710 on a Touch-Tone telephone and follow the
instructions on the reverse side. There is NO CHARGE to you for this call.
PLEASE VOTE
TELEPHONE VOTING WILL NOT BE AVAILABLE
AFTER 11:59 PM EDT ON MONDAY, MAY 10, 2004.
Please
Mark Here
for Address
Change or
Comments
SEE REVERSE SIDE
1. Election of Directors:
NOMINEES:
01 Todger Anderson
02 Gary P. McDaniel
____ FOR all nominees listed (except as marked to the contrary)
____ WITHHOLD AUTHORITY to vote for all nominees listed
(INSTRUCTION: To withhold authority to vote for any individual
nominee, write the name(s) on the line provided below.)
__________________________________
2. In their discretion, the proxies are authorized to vote upon such other
business as may properly come before the Meeting or any adjournment
thereof.
Every properly submitted proxy will be voted in the manner specified
hereon and, in the absence of specification, will be treated as GRANTING
authority to vote FOR the election of directors, and with discretionary
authority to vote upon such other business as may properly come before the
Meeting or any adjournment thereof. The undersigned hereby revokes any proxy
previously given.
IF VOTING BY MAIL, PLEASE SIGN, DATE AND
RETURN PROMPTLY.
Receipt of Notice of Annual Meeting and
Proxy Statement is hereby acknowledged.
Sign here exactly as name(s) appear(s) on
left
Dated: ________________________________,2004
____________________________________________
Signature
____________________________________________
Signature if held jointly
IMPORTANT - Joint owners must EACH sign.
When signing as attorney, Trustee, executor,
administrator, guardian, or corporate
officer, please give your FULL title.
Vote by Telephone or Mail
24 Hours a Day, 7 Days a Week
Telephone voting is available through 11:59 PM Eastern Time
the day prior to annual meeting day.
Your telephone vote authorizes the named proxies to vote your shares
in the same manner as if you marked, signed and returned your proxy card.
-------------------------------------------------------------------------------
Telephone Mail
1-800-435-6710
Mark, sign and date your proxy
Use any touch-tone telephone to vote card and return it in the
your proxy. Have your proxy card in OR enclosed postage-paid envelope.
hand when you call.
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If you vote your proxy by telephone,
you do NOT need to mail back your proxy card.