UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 14A
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 permitted by Rule
14a-6(e)(2))
[x] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Rule 14a-12
CORNERSTONE STRATEGIC VALUE FUND
(Name of Registrant as Specified in Its Charter)
---------------------------------
(Name of Person(s) Filing Proxy Statement, if other than 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:
(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(set forth the amount on which the
filing fee is calculated and state how it was determined):
(4) Proposed maximum aggregate value of transaction:
(5) Total fee paid:
[ ] Fee paid previously with preliminary materials:
[ ] 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:
CORNERSTONE STRATEGIC VALUE FUND, INC.
305 Madison Avenue
New York, NY 10165
----------------------------
NOTICE OF ANNUAL MEETING OF
STOCKHOLDERS
To Be Held on April 21, 2009
----------------------------
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders (the
"Meeting") of Cornerstone Strategic Value Fund, Inc., a Maryland corporation
(the "Fund"), will be held at 11:30 a.m., eastern time, on April 21, 2009 at the
Fifth Floor Conference Room, One West Pack Square, Asheville, NC 28801, for the
following purposes:
1. To approve the election of two directors to hold office until the year
2012 Annual Meeting of Stockholders (Proposal No. 1); and
2. To consider and vote upon such other matters as may properly come
before said Meeting or any adjournment thereof.
The Board of Directors has fixed the close of business on February 17,
2009 as the record date for the determination of stockholders entitled to notice
of, and to vote at, this Meeting or any adjournment thereof. The stock transfer
books will not be closed.
Copies of the Fund's most recent annual report may be ordered free of
charge by any stockholder by writing to the Fund, c/o Ultimus Fund Solutions,
LLC, 305 Madison Avenue, New York, NY 10165, or by calling collect (513)
326-3597.
By Order of the Board of Directors
Gary A. Bentz
Secretary
Dated: March 2, 2009
WHETHER OR NOT YOU EXPECT TO BE PRESENT AT THE MEETING, PLEASE FILL IN, DATE,
SIGN AND MAIL THE ENCLOSED PROXY CARD IN THE ENCLOSED REPLY ENVELOPE. YOUR
PROMPT RESPONSE WILL HELP ASSURE A QUORUM AT THE MEETING.
INSTRUCTIONS FOR SIGNING PROXY CARDS
The following general rules for signing proxy cards may be of
assistance to you and avoid the time and expense to the Fund involved in
validating your vote if you fail to sign your proxy card properly.
1. Individual Accounts: Sign your name exactly as it appears in the
registration on the proxy card.
2. Joint Accounts: Either party may sign, but the name of the party
signing should conform exactly to a name shown in the registration.
3. Other Accounts: The capacity of the individual signing the proxy card
should be indicated unless it is reflected in the form of
registration. For example:
REGISTRATION
CORPORATE ACCOUNTS VALID SIGNATURE
------------------ ---------------
(1) ABC Corp. ABC Corp. (by John Doe, Treasurer)
(2) ABC Corp. John Doe, Treasurer
(3) ABC Corp.
c/o John Doe, Treasurer John Doe
(4) ABC Corp. Profit Sharing Plan John Doe, Trustee
TRUST ACCOUNTS
--------------
(1) ABC Trust Jane B. Doe, Trustee
(2) Jane B. Doe, Trustee u/t/d/ 12/28/78 Jane B. Doe
CUSTODIAL OR ESTATE ACCOUNTS
----------------------------
(1) John B. Smith, Cust.
f/b/o John B. Smith, Jr. UGMA. John B. Smith
(2) John B. Smith John B. Smith, Jr., Executor
CORNERSTONE STRATEGIC VALUE FUND, INC.
305 Madison Avenue
New York, NY 10165
----------------------------
PROXY STATEMENT FOR ANNUAL MEETING OF STOCKHOLDERS
to be held on April 21, 2009
----------------------------
GENERAL
This Proxy Statement is furnished in connection with the solicitation
of proxies by the Board of Directors of Cornerstone Strategic Value Fund, Inc.,
a Maryland corporation (the "Fund") for use at the Annual Meeting of
Stockholders for the year 2009 (the "Meeting") to be held 11:30 a.m., eastern
time, on April 21, 2009 at the Fifth Floor Conference Room, One West Pack
Square, Asheville, NC 28801, and at any and all adjournments thereof. A form of
proxy is enclosed herewith. This Proxy Statement and the accompanying form of
proxy are being first mailed to stockholders of the Fund ("Stockholder(s)") on
or about March 2, 2009.
Any Stockholder who executes and delivers a proxy may revoke it by
written communication to the Secretary of the Fund at any time prior to its use
or by voting in person at the Meeting. Attendance by a Stockholder at the
Meeting does not, in itself, revoke a proxy. Unrevoked proxies will be voted in
accordance with the specifications thereon and, unless specified to the
contrary, will be voted FOR the election of Messrs. Scott B. Rogers and Thomas
H. Lenagh as the nominees for Class II Director.
In general, abstentions and broker non-votes, as defined below, count
for purposes of obtaining a quorum but do not count as votes cast with respect
to any proposal where the broker does not have discretion. With respect to a
proposal requiring the affirmative vote of a majority of the Fund's outstanding
shares of common stock, the effect of abstentions and broker non-votes is the
same as a vote against such proposal. Otherwise, abstentions and broker
non-votes have no effect on the outcome of a proposal. A broker non-vote is a
proxy from a broker or nominee indicating that such person has not received
instructions from the beneficial owner or other person entitled to vote shares
on a particular matter with respect to which the broker or nominee does not have
discretionary voting power.
At least one-third of the Fund's Stockholders must be present at the
Meeting in person or by proxy to constitute a quorum for the transaction of
business by the Fund. In the event that a quorum is not present at the Meeting,
the persons named as proxies may propose one or more adjournments of the Meeting
from time to time. Any such adjournment will require the affirmative vote of a
majority of those shares represented at the Meeting in person or by proxy. The
persons named as proxies will vote those proxies which they are entitled to vote
FOR or AGAINST any such proposal in their discretion.
The cost of soliciting the proxies will be borne by the Fund. Proxy
solicitations will be made primarily by mail, but solicitations may also be made
by telephone, telegraph or personal interviews conducted by officers of the Fund
or Ultimus Fund Solutions, LLC, the administrator to the Fund (the
"Administrator").
Only holders of the Fund's issued and outstanding shares of common
stock of record at the close of business on February 17, 2009 are entitled to
notice of, and to vote at, the Meeting. Each such holder is entitled to one vote
per share of common stock so held. The number of shares of common stock
outstanding on February 17, 2009 was 6,844,896. The Fund is a diversified,
closed-end management investment company.
Copies of the Fund's most recent annual report may be ordered free of
charge to any Stockholder by writing to the Fund, c/o Ultimus Fund Solutions,
LLC, 305 Madison Avenue, New York, NY 10165, or by calling collect (513)
326-3597. This report is not to be regarded as proxy-soliciting material.
This Proxy Statement is first being mailed to Stockholders on or about
March 2, 2009.
1
PROPOSAL NO. 1
ELECTION OF DIRECTORS
In accordance with the Fund's By-laws, the Fund's Board of Directors is
divided into three classes: Class I, Class II and Class III. Each class has a
term of three years and each year the term of office of one class expires. The
effect of these staggered terms is to limit the ability of other entities or
persons to acquire control of the Fund by delaying the replacement of a majority
of the Board of Directors.
At the Meeting, Stockholders will be asked to elect two Class II
Directors to hold office until the year 2012 Annual Meeting of Stockholders or
thereafter until each of their respective successors is duly elected and
qualified. The term of office of the Class II Directors, currently consisting of
Messrs. Scott B. Rogers and Thomas H. Lenagh, will expire at the year 2012
Annual Meeting or thereafter until his respective successor is duly elected and
qualified. If elected, each nominee has consented to serve as a Director of the
Fund until his successor is duly elected and qualified. Each Nominee was
considered and recommended by the Fund's Nominating and Corporate Governance
Committee.
The persons named in the accompanying form of proxy intend to vote at
the Meeting (unless directed not to vote) FOR the election of these nominees.
Each nominee has indicated that he will serve if elected, and the Board of
Directors has no reason to believe that any of the nominees named above will
become unavailable for election as a director, but if any nominee should be
unable to serve, the proxy will be voted for any other person determined by the
persons named in the proxy in accordance with their judgment.
The following table sets forth the names, addresses, birth dates and
principal occupations of each of the nominees for election as Directors:
NOMINEES
NUMBER OF
PORTFOLIOS
IN FUND DIRECTORSHIPS HELD
NAME AND POSITION(S) TERM OF COMPLEX BY NOMINEE FOR
ADDRESS(1) WITH OFFICE PRINCIPAL OCCUPATION OVER OVERSEEN DIRECTOR OUTSIDE OF
(BIRTH DATE) FUND SINCE PAST 5 YEARS BY DIRECTOR FUND COMPLEX*
------------------------------------------------------------------------------------------------------------------------
Class II Non-Interested Nominees to serve until the Year 2012 Annual Meeting of Stockholders:
Scott B. Rogers Director; 2000 Chairman, Board of Health Partners 3 Chairman & Director,
(July 1955) Audit, Inc.; Chief Executive Officer, Recycling Unlimited;
Nominating Asheville Buncombe Community Director of A-B
and Corporate Christian Ministry; and President, Vision Board,
Governance ABCCM Doctor's Medical Clinic; Interdenominational
Committee Appointee, NC Governor's Commission on Ministerial Alliance,
Member Welfare to Work; Director/Trustee of Faith Partnerships,Inc.
Cornerstone Total Return Fund, Inc. and
Cornerstone Progressive Return Fund
Thomas H.Lenagh Director; 1987 Independent Financial Advisor; 3 Director of Adams
(Nov. 1924) Audit, Director of Photonics Products Group; Express Company,
Nominating and Director/Trustee of Cornerstone Total Petroleum and Resources
Corporate Return Fund, Inc. and Cornerstone Corporation, and
Governance Progressive Return Fund PPGI Industries.
Committee
Member
------------
(1) The mailing address of each Nominee with respect to Fund operations is
305 Madison Avenue, New York, NY 10165.
* As of December 31, 2008, the Fund Complex is comprised of the Fund,
Cornerstone Total Return Fund, Inc., and Cornerstone Progressive
Return Fund, all of which are managed by Cornerstone Advisors, Inc.
Each of the above Nominees oversee all of the Funds in the Fund
Complex.
2
REMAINING BOARD OF DIRECTORS
The following tables set forth the names, addresses, birth dates, and
principal occupations of each of the remaining Directors of the Fund.
NUMBER OF
PORTFOLIOS
IN FUND DIRECTORSHIPS HELD
NAME AND POSITION(S) TERM OF COMPLEX BY NOMINEE FOR
ADDRESS(1) WITH OFFICE PRINCIPAL OCCUPATION OVER OVERSEEN DIRECTOR OUTSIDE OF
(BIRTH DATE) FUND SINCE PAST 5 YEARS BY DIRECTOR FUND COMPLEX*
-----------------------------------------------------------------------------------------------------------------------
Class I Non-Interested Director to serve until the Year 2011 Annual Meeting of Stockholders:
Edwin Meese III Director; 2001 Distinguished Fellow, The Heritage 3 Director of Carrington
(Dec. 1931) Audit, Foundation Washington D.C.; Laboratories, Inc.
Nominating Distinguished Visiting Fellow at the
and Corporate Hoover Institution, Stanford
Governance University; Senior Adviser,
Committee Revelation L.P.; Director/Trustee
Member of Cornerstone Total Return Fund, Inc.
and Cornerstone Progressive Return Fund
Class I Interested Director to serve until the Year 2011 Annual Meeting of Stockholders:
Ralph W. Bradshaw Chairman 1998 President, Cornerstone Advisors 3
(Dec. 1950)** of the Board Inc.; Financial Consultant; President
of Directors and Director/Trustee of Cornerstone
and President Total Return Fund, Inc. and
Cornerstone Progressive Return Fund
Class III Non-Interested Directors to serve until the Year 2010 Annual Meeting of Stockholders:
Glenn W.Wilcox, Sr. Director; 2000 Chairman of Tower Associates, Inc.; 3 Director of Wachovia
(Dec. 1931) Chairman of Chairman of the Board and Chief Corp. WNC Regional
Audit Committee Executive Officer of Wilcox Travel Advisory Board;
and Nominating Agency, Inc.; Director/Trustee of Director of Champion
and Corporate Cornerstone Total Return Fund, Inc. Industries, Inc.
Governance and Cornerstone Progressive
Committee Return Fund
Member
Andrew A. Strauss Director; 2000 Attorney and senior member of 3 Director of Deerfield
(Nov. 1953) Chairman of Strauss & Associates, P.A., Episcopal Retirement
Nominating and Attorneys, Asheville and Community
Corporate Governance Hendersonville, NC; previous
Committee and President of White Knight Healthcare, Inc.
Audit Committee and LMV Leasing, Inc., a wholly owned subsidiary
Member of Xerox Credit Corporation;
Director/Trustee of Cornerstone
Total Return Fund, Inc. and
Cornerstone Progressive Return Fund
-----------
(1) The mailing address of each Director with respect to Fund operations
is 305 Madison Avenue, New York, NY 10165.
* As of December 31, 2008, the Fund Complex is comprised of the Fund,
Cornerstone Total Return Fund, Inc. and Cornerstone Progressive Return
Fund, all of which are managed by Cornerstone Advisors, Inc. Each of
the above Directors oversee all of the Funds in the Fund Complex.
** Mr. Bradshaw is an "interested person" as defined in the Investment
Company Act of 1940 because of his affiliation with Cornerstone
Advisors, Inc.
3
The following table sets forth, for each Director, the aggregate dollar range of
equity securities owned of the Fund and of all Funds overseen by each Director
in the Fund Complex as of December 31, 2008. The information as to beneficial
ownership is based on statements furnished to the Fund by each Director.
AGGREGATE DOLLAR RANGE OF
DOLLAR RANGE OF EQUITY EQUITY IN ALL FUNDS
NAME SECURITIES IN THE FUND OVERSEEN BY DIRECTORS IN FUND COMPLEX
--------------------------------------------------------------------------------------------
NON-INTERESTED DIRECTORS
Thomas H. Lenagh 0 $1-$10,000
Edwin Meese III 0 0
Scott B. Rogers 0 $50,001-$100,000
Andrew A. Strauss $1-$10,000 $1-$10,000
Glenn W. Wilcox Sr. $1-$10,000 $10,001-$50,000
INTERESTED DIRECTOR
Ralph W. Bradshaw $10,001-$50,000 $50,001-$100,000
EXECUTIVE OFFICERS
In addition to Mr. Bradshaw, the current officers of the Fund are:
NAME AND
ADDRESS (1) POSITION TERM OF
(BIRTH DATE) WITH FUND OFFICE SINCE PRINCIPAL OCCUPATION OVER PAST 5 YEARS
-----------------------------------------------------------------------------------------------------
William A. Clark Vice President 2004 Director and Stockholder of Cornerstone
(Oct. 1945) Advisors, Inc.; Vice President and former
Director/Trustee of Cornerstone Total
Return Fund, Inc. and Cornerstone Progressive
Return Fund; Financial Consultant; former
Director of Investors First Fund, Inc.
Gary A. Bentz Chief 2004, 2008, Chairman and Chief Financial Officer
(June 1956) Compliance 2009 of Cornerstone Advisors, Inc.; previous
Officer; Secretary, Director, Vice President and Treasurer of the
and Fund and Cornerstone Total Return Fund, Inc.;
Assistant Financial Consultant, C.P.A.; Chief Compliance
Treasurer Officer, Secretary, and Assistant Treasurer of
Cornerstone Strategic Value Fund, Inc. and
Cornerstone Progressive Return Fund
--------------
(1) The officers' address is the same as the Fund's.
Under the federal securities laws, the Fund is required to provide to
Stockholders in connection with the Meeting information regarding compensation
paid to Directors by the Fund as well as by the various other U.S. registered
investment companies advised by the Fund's investment adviser during its prior
calendar year. The following table provides information concerning the
compensation paid during the year ended December 31, 2008, to each Director of
the Fund in his capacity solely as a Director of the Fund. This information does
not reflect any additional monies received for a named individual serving in any
other capacity to the Fund. Please note that the Fund has no bonus, profit
sharing, pension or retirement plans.
4
DIRECTOR AGGREGATE COMPENSATION TOTAL COMPENSATION FROM FUND AND
NAME OF DIRECTOR SINCE FROM FUND FUND COMPLEX* PAID TO DIRECTOR
-------------------------------------------------------------------------------------------------------------
Glenn W. Wilcox, Sr. 2000 $21,000 $47,000
Andrew A. Strauss 2000 $21,000 $47,000
Edwin Meese III 2001 $20,500 $46,000
Scott B. Rogers 2000 $21,000 $47,000
Thomas H. Lenagh 1987 $21,000 $47,000
Ralph W. Bradshaw 1998 0 0
----------
* For compensation purposes, the Fund Complex refers to the Fund,
Cornerstone Total Return Fund, Inc. and Cornerstone Progressive Return
Fund, all of which were managed by Cornerstone Advisors, Inc. during
the year ended December 31, 2008.
DIRECTOR TRANSACTIONS WITH FUND AFFILIATES. As of December 31, 2008,
neither the Independent Directors nor members of their immediate family owned
securities beneficially or of record in Cornerstone Advisers, Inc., or an
affiliate of Cornerstone Advisors, Inc. Furthermore, over the past five years,
neither the Independent Directors nor members of their immediate family have any
direct or indirect interest, the value of which exceeds $120,000, in Cornerstone
Advisors, Inc. or any of its affiliates. In addition, since the beginning of the
last two fiscal years, neither the Independent Directors nor members of their
immediate family have conducted any transactions (or series of transactions) or
maintained any direct or indirect relationship in which the amount involved
exceeds $120,000 and to which Cornerstone Advisors, Inc. or any affiliate
thereof was a party.
Each Director attended at least seventy-five (75%) percent of the eight
(8) meetings of the Board of Directors (including regularly scheduled and
special meetings) held during the period for which he was a Director.
THE AUDIT COMMITTEE
During the calendar year ended December 31, 2008, the Audit Committee
was composed of all directors who are not interested persons of the Fund, as
such term is defined in Section 2(a)(19) of the Investment Company Act. The
members of the Audit Committee during this period were Messrs. Wilcox, Sr.,
Strauss, Rogers, Meese, and Lenagh. The Board of Directors has adopted an audit
committee charter. The principal functions of the Audit Committee include but
are not limited to, (i) the oversight of the accounting and financial reporting
processes of the Fund and its internal control over financial reporting; (ii)
the oversight of the quality and integrity of the Fund's financial statements
and the independent audit thereof; and (iii) the approval, prior to the
engagement of, the Fund's independent registered public accounting firm and, in
connection therewith, to review and evaluate the qualifications, independence
and performance of the Fund's independent registered public accounting firm. The
Audit Committee convened four (4) times during the 2008 calendar year.
The Audit Committee currently does not have an Audit Committee
Financial Expert, as such term is defined in Section 407 of the Sarbanes-Oxley
Act of 2002. Rather, the Audit Committee members believe that each of their
individual experiences provide the Audit Committee with sufficient experience
and expertise to allow them to perform their duties as members of the Audit
Committee.
THE NOMINATING AND CORPORATE GOVERNANCE COMMITTEE
The Fund has a standing Nominating and Corporate Governance Committee
(the "Committee"), which is comprised of Messrs. Wilcox, Sr., Strauss, Rogers,
Meese, and Lenagh, all of whom are directors who are not interested persons of
the Fund, as such term is defined in Section 2(a)(19) of the Investment Company
Act. The Committee has a written charter. In addition to its responsibility to
oversee the corporate governance of the Fund, the Committee is appointed to
identify and select qualified candidates that have exhibited strong decision
making ability, substantial business experience, relevant knowledge of the
investment company industry (including closed-end funds), skills or
technological expertise and exemplary personal integrity and reputation. In
addition, the Committee seeks candidates that have experience and knowledge
involving all of the service providers of a registered investment company.
The Committee will consider all nominees recommended by Stockholders of
the Fund, so long as Stockholders send their recommendations in writing to the
Secretary of the Fund in a manner consistent with the Fund's By-laws. The
Committee will seek candidates for the Board that have exhibited strong
decision-making ability, substantial business experience, relevant knowledge,
skills or technological expertise, and exemplary personal integrity and
reputation. Specifically, the Committee assesses all director nominees taking
5
into account several factors, including, but not limited to, issues such as the
current needs of the Board and the nominee's: (i) integrity, honesty, and
accountability; (ii) successful leadership experience and strong business
acumen; (iii) forward-looking, strategic focus; (iv) collegiality; (v)
independence and absence of conflicts of interests; and (vi) ability to devote
necessary time to meet director responsibilities. The Committee will ultimately
recommend nominees that it believes will enhance the Board's ability to oversee,
in an effective manner, the affairs and business of the Fund. The Committee will
consider and evaluate Stockholder-recommended candidates by applying the same
criteria used to evaluate director-recommended candidates. Currently, the
By-laws provide that the deadline for submitting a Stockholder proposal for
inclusion in the Fund's proxy statement and proxy for the Fund's 2010 annual
meeting of stockholders pursuant to Rule 14a-8 promulgated under the Securities
Exchange Act of 1934, is November 2, 2009. Stockholders wishing to submit
proposals or director nominations that are not to be included in such proxy
statement and proxy must deliver notice to the Secretary at the principal
executive offices of the Fund not later than the close of business on December
2, 2009 nor earlier than the close of business on November 2, 2009. Stockholders
are also advised to review the Fund's By-laws, which contain additional
requirements with respect to advance notice of Stockholder proposals and
director nominations.
During the calendar year ended December 31, 2008, the Committee met and
discussed the nomination of the Class I Directors for the 2008 Annual Meeting of
Stockholders. In 2009, the Committee met and discussed the nomination of the
Class II Directors of the Fund for the 2009 Annual Meeting of Stockholders. Each
Nominee was recommended by the Committee, composed of the non-interested
Directors.
REQUIRED VOTE
Directors are elected by a plurality (a simple majority of the votes
cast at a meeting) of the votes cast by the holders of shares of common stock of
the Fund present in person or represented by proxy at a meeting with a quorum
present. For purposes of the election of Directors, abstentions and broker
non-votes will be counted as shares present for quorum purposes, may be
considered votes cast, and may affect the plurality vote required for Directors.
THE BOARD OF DIRECTORS RECOMMENDS THAT THE STOCKHOLDERS VOTE "FOR" THE
ELECTION OF MESSRS. SCOTT B. ROGERS AND THOMAS H. LENAGH AS CLASS II DIRECTORS
OF THE FUND.
AUDIT COMMITTEE REPORT
In 2009, the Audit Committee met with the Fund's Administrator and the
Fund's independent registered public accounting firm, Tait, Weller & Baker LLP,
to discuss and review the Fund's audited financial statements for the calendar
year ended December 31, 2008. The Fund's independent registered public
accounting firm represented to the Audit Committee that the Fund's financial
statements were prepared in accordance with U.S. generally accepted accounting
principles, and the Audit Committee has reviewed and discussed the financial
statements with the Fund's Administrator and its independent registered public
accounting firm. The Audit Committee also discussed with the independent
registered public accounting firm matters required to be discussed by Statement
on Auditing Standards No. 61.
The Fund's independent registered public accounting firm also provided
to the Audit Committee the written disclosures required by Independence
Standards Board Standard No. 1 (Independence Discussions with Audit Committees),
and the Audit Committee discussed with the independent registered public
accounting firm their independence, in light of the services they were
providing.
Based upon the Audit Committee's discussion with the Fund's
Administrator
and the independent registered public accounting firm and the Audit Committee's
review of the representations and report of the independent registered public
accounting firm to the Audit Committee, the Audit Committee recommended that the
Board of Directors include the audited financial statements in the Fund's Annual
Report for the calendar year ending December 31, 2008 filed with the Securities
and Exchange Commission ("SEC").
This Audit Committee report shall not be deemed incorporated by
reference in any document previously or subsequently filed with the SEC that
incorporates by reference all or any portion of this proxy statement except to
the extent that the Fund specifically requests that the report be specifically
incorporated by reference.
6
The Audit Committee of the Board of Directors has selected Tait, Weller
& Baker LLP to be employed as the Fund's independent registered public
accounting firm to make the annual audit and to report on, as may be required,
the financial statements which may be filed by the Fund with the SEC during the
ensuing year.
Respectfully submitted,
Glenn W. Wilcox, Sr.
Andrew A. Strauss
Scott B. Rogers
Edwin Meese III
Thomas H. Lenagh
RELATIONSHIP WITH INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
The Fund's independent registered public accounting firm for the
calendar year ended December 31, 2008, was the firm of Tait, Weller & Baker LLP.
The Audit Committee has selected Tait, Weller & Baker LLP to be the Fund's
registered public accounting firm for the calendar year ending December 31,
2009.
A representative of Tait, Weller & Baker LLP is not expected to be
present at the Annual Meeting of Stockholders, but may be available by telephone
to respond to appropriate questions from Stockholders.
PRINCIPAL ACCOUNTANT FEES AND SERVICES
Aggregate fees for professional services rendered for the Fund by Tait,
Weller & Baker LLP as of or for the year ended December 31, 2008 and 2007 were:
SERVICE 2008 2007
--------------------------------------------------------------------------------
Audit Fees $ 18,100 $ 17,200
Audit-Related Fees 0 0
Tax Fees (1) 3,600 3,500
All Other Fees 0 0
Total $ 21,700 $ 20,700
-----------
(1) Tax services in connection with the Fund's excise tax calculations and
review of the Fund's applicable tax returns.
All of the services performed by the Fund's independent registered
public accounting firm, including audit-related and non-audit related services,
were pre-approved by the Audit Committee, as required under the Audit Committee
Charter. The Audit Fees for the years ended December 31, 2008 and 2007 were for
professional services rendered for the audits of the financial statements of the
Fund, reviews, and issuances of consents, and assistance with review of
documents filed with the SEC. Tax Fees for the years ended December 31, 2008 and
2007 were for services performed in connection with income and excise tax
services other than those directly related to the audit of the income tax
accrual. "All Other Fees" includes fees incurred related to merger, accounting
research, and other special projects.
The Audit Committee has considered and determined that the services
provided by Tait, Weller & Baker LLP are compatible with maintaining Tait,
Weller & Baker LLP's independence. The aggregate fees included in Audit Fees are
fees billed for the calendar year for the audit of the Fund's annual financial
statements. Of the time expended by the Fund's independent registered public
accounting firm to audit the Fund's financial statements for the calendar year
ended December 31, 2008, less than 50% of such time involved work performed by
persons other than the independent registered public accounting firm's full
time, permanent employees. Tait, Weller & Baker LLP did not perform any services
on behalf of Cornerstone Advisors, Inc.
7
INFORMATION PERTAINING TO THE FUND'S INVESTMENT ADVISER AND ADMINISTRATOR
THE INVESTMENT ADVISER
Cornerstone Advisors, Inc. has acted as the Fund's investment adviser
("Investment Adviser") since 2001, and has its principal office at One West Pack
Square, Suite 1650, Asheville, North Carolina 28801. Cornerstone Advisors, Inc.
was organized in February of 2001, to provide investment management services to
closed-end investment companies and is registered with the SEC under the
Investment Advisers Act of 1940, as amended. Cornerstone Advisors, Inc. is the
Investment Adviser to two other closed-end funds, Cornerstone Total Return Fund,
Inc. and Cornerstone Progressive Return Fund. Messrs. Bradshaw, Bentz and Clark
are the only stockholders of the Investment Adviser.
Mr. Bradshaw, an owner of Cornerstone Advisors, Inc., is President and
Chairman of the Board of Directors of the Fund. Mr. Bentz, formerly the Vice
President, Treasurer and a Director of the Fund and currently Chief Compliance
Officer, Secretary, and Assistant Treasurer of the Fund, and Mr. Clark, formerly
a Director and currently Vice President of the Fund, are also owners of
Cornerstone Advisors, Inc. The address of Messrs. Bradshaw, Bentz, and Clark is
One West Pack Square, Suite 1650, Asheville, North Carolina 28801.
THE ADMINISTRATOR
Ultimus Fund Solutions, LLC, whose address is 305 Madison Avenue, New
York, NY 10165, currently acts as the Administrator of the Fund.
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934 (the "Exchange Act")
and Section 30(h) of the Investment Company Act in combination require the
Fund's directors and officers, persons who own more than ten (10%) of the Fund's
Common Stock, and the Fund's Investment Adviser and its directors and officers,
to file reports of ownership and changes in ownership with the SEC. The Fund
believes that the Fund's directors and officers, the Fund's Investment Adviser
and its directors and officers have complied with all applicable filing
requirements during the year ended December 31, 2008.
INFORMATION PERTAINING TO CERTAIN STOCKHOLDERS
The following table sets forth the beneficial ownership of shares of the
Fund by each person known to the Fund to be deemed the beneficial owner of more
than five (5%) percent of the outstanding shares of the Fund at the close of
business on February 17, 2009:
NAME AND ADDRESS OF BENEFICIAL OWNER SHARES OF COMMON STOCK BENEFICIALLY OWNED
--------------------------------------------------------------------------------
None
Additionally, on February 17, 2009, Cede & Co., a nominee for
participants in the Depository Trust Company, held of record 6,666,258 shares of
the Fund, equal to approximately 97% of the outstanding shares of the Fund. All
the directors and executive officers of the Fund, as of the date of this proxy,
owned less than 1% of the outstanding shares of the Fund.
8
ADDITIONAL INFORMATION
The Proxy Statement does not contain all of the information set forth
in the registration statements and the exhibits relating thereto which the Fund
has filed with the SEC, under the Exchange Act and the Investment Company Act,
to which reference is hereby made.
The Fund is subject to the informational requirements of the Exchange
Act and in accordance therewith, files reports and other information with the
SEC. Reports, proxy statements, registration statements and other information
filed by the Funds can be inspected and copied at the public reference
facilities of the SEC in Washington, DC. Copies of such materials also can be
obtained by mail from the Public Reference Branch, Office of Consumer Affairs
and Information Services, SEC, 100 F Street, NE, Washington, DC 20594, at
prescribed rates.
OTHER BUSINESS
The Board of Directors of the Fund does not know of any other matter
which may come before the Meeting, but should any other matter requiring a vote
of Stockholders arise, including any questions as to the adjournment of the
Meeting, it is the intention of the persons named in the proxy to vote the
proxies in accordance with their judgment on that matter in the interest of the
Fund.
PROPOSALS TO BE SUBMITTED BY STOCKHOLDERS
All proposals by Stockholders of the Fund which are intended to be
presented at the Fund's next Annual Meeting of Stockholders, to be held in the
year 2010, must be received by the Fund addressed to Cornerstone Strategic Value
Fund, Inc., c/o Ultimus Fund Solutions, LLC, 305 Madison Avenue, New York, NY
10165 in advance of the meeting as set forth in this document.
CORNERSTONE STRATEGIC VALUE FUND, INC.
Gary A. Bentz, Secretary
Dated: March 2, 2009
CORNERSTONE STRATEGIC VALUE FUND, INC.
PROXY CARD FOR THE ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON APRIL 21, 2009
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned stockholder of Cornerstone Strategic Value Fund, Inc. (the
"Fund") hereby constitutes and appoints Messrs. William A. Clark, Andrew A.
Strauss, and Glenn W. Wilcox, Sr., or any of them, the action of a majority of
them voting to be controlling, as proxy of the undersigned, with full power of
substitution, to vote all shares of common stock of the Fund standing in his or
her name on the books of the Fund at the Annual Meeting of Stockholders of the
Fund to be held at the Fifth Floor Conference Room, One West Pack Square,
Asheville, NC 28801 , on April 21, 2009 at 11:30 a.m., Eastern Time, or at any
adjournment thereof, with all the powers which the undersigned would possess if
personally present, as designated on the reverse hereof.
The undersigned hereby revokes any proxy previously given and instructs
the said proxies to vote in accordance with the aforementioned instructions with
respect to (1) the election of two Class II Directors; and (2) the consideration
and vote of such other matters as may properly come before the Annual Meeting of
Stockholders or any adjournment thereof.
This proxy, when properly executed, will be voted in the manner directed
herein by the stockholder. If no such direction is made, the said proxies will
vote FOR Proposal 1, and in their discretion with respect to such other matters
as may properly come before the Annual Meeting of Stockholders, in the interest
of the Fund.
(Continued and to be dated and signed on reverse side)
ANNUAL MEETING OF STOCKHOLDERS OF
CORNERSTONE STRATEGIC VALUE FUND, INC.
April 21, 2009
PLEASE DATE, SIGN AND MAIL YOUR PROXY CARD IN THE ENVELOPE PROVIDED AS SOON AS
POSSIBLE.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" PROPOSAL 1 (THE ELECTION OF
DIRECTORS) AND "FOR" PROPOSAL 2. PLEASE SIGN, DATE AND RETURN PROMPTLY IN THE
ENCLOSED ENVELOPE. PLEASE MARK YOUR VOTE IN BLUE OR BLACK INK AS SHOWN HERE [X]
1. To approve the election of two (2) Class II Directors:
FOR WITHHOLD
Scott B. Rogers / / / /
Thomas H. Lenagh / / / /
2. In their discretion, the proxies are authorized to consider and vote upon
such matters as may properly come before the said Meeting or any
adjournment thereof.
FOR AGAINST ABSTAIN
/ / / / / /
Your proxy is important to assure a quorum at the Annual Meeting of Stockholders
whether or not you plan to attend the meeting in person. You may revoke this
proxy at anytime, and the giving of it will not affect your right to attend the
Annual Meeting of Stockholders and vote in person.
PLEASE MARK, SIGN, DATE AND RETURN THE PROXY CARD PROMPTLY USING THE ENCLOSED
ENVELOPE.
SIGNATURE OF STOCKHOLDER____________________________ DATE___________________
SIGNATURE OF STOCKHOLDER____________________________ DATE___________________
NOTE: Please sign exactly as your name or names appear on this Proxy. When
shares are held jointly, each holder should sign. When signing as executor,
administrator, attorney, trustee or guardian, please give full title as such. If
the signer is a corporation, please sign full corporate name by duly authorized
officer, giving full title as such. If signer is a partnership, please sign in
partnership name by authorized person.