UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT INVESTMENT COMPANIES
Investment Company Act file number 811-09261
---------------------------------
Foxby Corp.
--------------------------------------------------------------
(Exact name of registrant as specified in charter)
11 Hanover Square, New York, NY 10005
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(Address of principal executive offices) (Zipcode)
Thomas B. Winmill, President
11 Hanover Square
New York, NY 10005
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(Name and address of agent for service)
Registrant's telephone number, including area code: 1-212-344-6310
----------------
Date of fiscal year end: 12/31/03
------------------
Date of reporting period: 1/1/03 - 12/31/03
---------------------------
Form N-CSR is to be used by management investment companies to file reports
with the Commission not later than 10 days after the transmission to
stockholders of any report that is required to be transmitted to stockholders
under Rule 30e-1 under the Investment Company Act of 1940 (17 CFR 270.30e-1).
The Commission may use the information provided on Form N-CSR in its regulatory,
disclosure review, inspection, and policy making roles.
Item 1. Report to Shareholders
FOXBY
CORP.
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ANNUAL REPORT
December 31, 2003
Independent Public Accountant American Stock
Tait, Weller & Baker Exchange Symbol:
FXX
11 Hanover Square
New York, NY 10005
Tel 1-800-278-4353
www.foxbycorp.com
American Stock
FOXBY CORP. Exchange Symbol: FXX
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11 Hanover Square, New York, NY 10005
www.foxbycorp.com
February 9, 2004
Fellow Shareholders:
It is a pleasure to submit this 2003 Annual Report for Foxby Corp., and to
welcome our new shareholders who find the Fund's flexible total return
investment approach attractive.
As announced previously, shareholders voted to approve changing the Fund's
fundamental investment objective to make it a non-fundamental policy of seeking
total return. As a non-diversified, closed-end fund seeking total return, the
Fund now will exercise a flexible strategy in the selection of securities, and
will not be limited by the issuer's location, size, or market capitalization.
The Fund may invest in equity and fixed income securities of both new and
seasoned U.S.and foreign issuers, including securities convertible into common
stock, debt securities, futures, options, derivatives, and other instruments.
The Fund also may employ aggressive and speculative investment techniques, such
as selling securities short and borrowing money for investment purposes, a
practice known as "leveraging," and may invest defensively in short term,
liquid, high grade securities and money market instruments.
Market Review and Outlook
2003 was a year of relative stability in the markets. Interestingly, on
four days in 2002 the percentage gain or loss was large enough to rank among the
top 20 largest moves of the S&P 500 Index, according to The Wall Street Journal
(when the index declined 22.09%). By contrast, no day in 2003 showed a
percentage move large enough to make it into the top 20 (when the index gained
28.67%). In contrast, with its primarily large cap, technology holdings in
combination with its flexible investment techniques, including the use of short
S&P 500 futures positions to mute expected volatility, the Fund obtained a
positive total return on a market basis of 15.94% in 2003 and 6.18% on a net
asset value basis.
During 2003, the Federal Reserve lowered its target rate to 1.00%, leading
to a general recovery in many sectors of the economy, and stimulated not only
the home refinancing boom, but also improved corporate spending. Gross domestic
product, a broad measure of the economy's overall output, increased at an annual
rate of 8.2% during the third quarter - the strongest growth in more than 19
years. These factors, together with productivity gains and improvements in
corporate profits, paved the way for solid returns on equities during the
year. Given these financial currents, Foxby Corp. continued to implement its
strategy of maintaining a focused allocation in high quality companies with
solid financial strength and growth prospects, and employed futures on a
periodic basis reflecting a market timing strategy.
Looking ahead, we note that in January factory activity in the U.S.rose for
the eighth month in a row, accompanied by the biggest increase in prices since
March 2000, according to the Institute for Supply Management. The market's prior
concerns with deflation and economic weakness seem addressed by the Fed with its
massive injection of monetary liquidity and the Bush administration's fiscal
stimulus and numerous proposals to boost consumer confidence and consumption.
Nevertheless, we remain concerned with the proposed $2.4 trillion budget and
estimated record budget deficit of $521 billion, up from $375 bil-
lion last year - not including costs of occupying Iraq and other items - and
projected $1.35 trillion in deficit spending over the next five years.
In these changing economic conditions, the Fund's flexibility to invest in
large or small capitalization companies, U.S. or foreign, and in many kinds of
securities, gives it the advantage of being able to consider participating in an
investment in whatever form it may take to achieve an attractive total return.
Purchase Shares at an Attractive Discount
The Fund's current net asset value per share is $2.82.With a recent closing
on the American Stock Exchange of $2.47 per share, we believe this represents an
important opportunity to purchase additional shares at an attractive discount
from their underlying value. An affiliate of the investment manager owns 125,100
shares of the Fund, reflecting management's optimism about the Fund going
forward. If you have a question, please call toll-free 1-800-278-4353 and an
Investor Service Representative will be happy to assist you, as always, without
any obligation on your part. We appreciate your support and look forward to
serving your investment needs in the years ahead.
Sincerely,
/s/ Thomas B. Winmill
Thomas B. Winmill
President
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TOP TEN HOLDINGS
Comprise 38% of Total Assets
1. E*TRADE Financial Corp.
2. Cisco Systems, Inc.
3. Intel Corp.
4. SunGard Data Systems Inc.
5. MetroGAS S.A.
6. Liberty Media Corp.
7. Solectron Corp.
8. HCA Inc.
9. Pfizer Inc.
10. Hewlett-Packard Company
2 FOXBY CORP.
Schedule of Portfolio Investments - December 31, 2003
Shares Market Value
--------- ------------
COMMON STOCKS (98.60%)
Bakery Products (2.11%)
15,000 Tasty Baking Company.................................. $ 151,650
------------
Cable & Other Pay Television Services (1.58%)
3,461 Comcast Corp./(2)/.................................... 113,763
------------
Computer & Office Equipment (4.43%)
9,800 Hewlett-Packard Company............................... 225,106
1,000 International Business Machines Corp.................. 92,680
------------
317,786
------------
Computer Communications Equipment (4.50%)
13,300 Cisco Systems, Inc./(2)/.............................. 323,057
------------
Electronic Computers (3.85%)
5,000 Dell Computer Corp./(2)/.............................. 169,800
23,700 Sun Microsystems, Inc./(2)/........................... 106,413
------------
276,213
------------
Federal & Federally-Sponsored Credit Agencies (2.93%)
2,800 Fannie Mae............................................ 210,168
------------
Miscellaneous Business Credit Institution (1.53%)
8,900 ePlus inc./(2)/....................................... 109,746
------------
Miscellaneous Business Services (2.95%)
75,000 Safety Intelligence Systems Corp./(1)(2)/............. 212,145
------------
Natural Gas Distribution (3.94%)
43,900 MetroGAS S.A./(2)/.................................... 282,716
------------
Natural Gas Transmission (3.13%)
27,400 El Paso Corp. ........................................ 224,406
------------
Pharmaceutical Preparations (3.15%)
6,400 Pfizer Inc............................................ 226,112
------------
Precious Metals & Resources (1.33%)
127,500 Kenor ASA/(2)/........................................ 95,441
------------
Printed Circuit Boards (3.19%)
38,700 Solectron Corp./(2)/.................................. 228,717
------------
See accompanying notes to financial statements.
FOXBY CORP. 3
Schedule of Portfolio Investments - December 31, 2003
Shares Market Value
--------- ------------
COMMON STOCKS (continued)
Radio & TVBroadcasting & Communications
Equipment (9.75%)
13,100 Motorola, Inc......................................... $ 184,317
8,500 Nokia Oyj ADR......................................... 144,500
6,800 NTT DoCoMo, Inc....................................... 155,720
4,000 QUALCOMM Inc.......................................... 215,720
------------
700,257
------------
Retail-Shoe Stores (1.84%)
4,400 The Finish Line, Inc. Class A/(2)/.................... 131,868
------------
Savings Institutions, Not Federally Chartered (2.57%)
4,600 Washington Mutual, Inc................................ 184,552
------------
Scales and Balances,exc. Laboratory (2.54%)
22,282 Bonso Electronics International Inc................... 182,712
------------
Security Brokers,Dealers & Flotation Companies (7.39%)
30,000 E*TRADE Financial Corp./(2)/........................... 379,500
5,000 Interactive Data Corp./(2)/............................ 82,800
5,300 Maxcor Financial Group Inc............................ 68,577
------------
530,877
------------
Semiconductors & Related Devices (4.48%)
10,000 Intel Corp............................................ 322,000
------------
Services-Computer Processing & Data Preparation (7.09%)
5,300 Automatic Data Processing, Inc........................ 209,933
10,800 SunGard Data Systems Inc./(2)/........................ 299,268
------------
509,201
------------
Services-Educational Services (1.70%)
1,800 Apollo Group, Inc./(2)/............................... 122,400
------------
Services-General Medical & Surgical Hospitals (3.17%)
5,300 HCA Inc............................................... 227,688
------------
Services-Motion Picture & Video Tape Production (3.31%)
20,000 Liberty Media Corp./(2)/.............................. 237,800
------------
Services-Prepackaged Software (3.87%)
5,200 Sybase, Inc./(2)/..................................... 107,016
4,600 VERITAS Software Corp./(2)/........................... 170,936
------------
277,952
------------
See accompanying notes to financial statements.
4 FOXBY CORP.
Schedule of Portfolio Investments - December 31,2003
Shares Market Value
--------- ------------
COMMON STOCKS (continued)
Special Trade Contractors (1.26%)
5,000 Matrix Service Company/(2)/........................... $ 90,750
------------
Telephone & Telegraph Apparatus (5.23%)
5,500 France Telecom SAADR.................................. 157,245
14,300 Level 3 Communications, Inc./(2)/..................... 81,510
3,700 UTStarcom, Inc./(2)/.................................. 137,159
------------
375,914
------------
Telephone Communications (4.15%)
4,100 IDT Corp./(2)/........................................ 90,815
12,600 Sprint Corp-Fon Group................................. 206,892
------------
297,707
------------
Wholesale-Beer, Wine & Distilled Alcoholic
Beverages (1.63%)
3,700 Central European Distribution Corp./(2)/.............. 116,920
------------
Total Common Stocks (cost: $5,328,108)............. 7,080,518
------------
Par Value SHORT TERM INVESTMENTS (1.40%)
---------
$100,393 Repurchase Agreement with State Street Bank & Trust,
0.10%, due 1/02/04 (collateralized by U.S. Treasury
Notes)............................................... 100,393
------------
Total Short Term Investments (cost:$100,393)....... 100,393
------------
Total Investments (cost:$5,428,501) (100.00%)... $ 7,180,911
============
/(1)/ Security is not publicly traded.
/(2)/ Non-income producing security.
See accompanying notes to financial statements.
FOXBY CORP. 5
STATEMENT OF ASSETS AND LIABILITIES
December 31, 2003
ASSETS:
Investments at market value
(cost:$5,428,501) (Note 2).................................. $ 7,180,911
Dividend receivable......................................... 3,147
Other assets................................................ 1,934
------------
Total assets............................................. 7,185,992
------------
LIABILITIES:
Accrued expenses............................................ 29,133
Accrued management fees (Note 4)............................ 5,870
------------
Total liabilities........................................ 35,003
------------
NET ASSETS: (applicable to 2,602,847 shares
outstanding: 500,000,000 shares of $.01
par value authorized)......................................... $ 7,150,989
============
NET ASSET VALUE PER SHARE
($7,150,989/2,602,847 shares outstanding)................... $ 2.75
============
At December 31, 2003, net assets consisted of:
Paid-in capital............................................. $ 23,560,481
Net unrealized appreciation on investments.................. 1,752,410
Accumulated net realized loss on investments and futures.... (18,161,902)
------------
$ 7,150,989
============
STATEMENT OF OPERATIONS
Year Ended December 31, 2003
INVESTMENT INCOME:
Dividends................................................... $ 29,162
Interests................................................... 3,065
------------
Total investment income.................................. 32,227
------------
EXPENSES:
Professional (Note 4)....................................... 76,093
Investment management (Note 4).............................. 67,731
Printing.................................................... 56,250
Transfer agent.............................................. 44,014
Registration (Note 4)....................................... 25,308
Directors................................................... 13,125
Custodian................................................... 3,650
Other....................................................... 10,901
------------
Total expenses........................................... 297,072
------------
Net investment loss................................... (264,845)
------------
REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS AND FOREIGN CURRENCIES:
Net realized gain on investments............................ 88,319
Net realized loss from futures transactions................. (1,331,563)
Unrealized appreciation on investments during the period.... 1,927,762
------------
Net realized and unrealized gain on investments............. 684,518
------------
Net increase in net assets resulting from operations........ $ 419,673
============
See accompanying notes to financial statements.
FOXBY CORP 6
STATEMENTS OF CHANGES IN NET ASSETS
Year Ended December 31, 2003, Nine Months Ended December 31, 2002, and Year
Ended March 31, 2002
Year Nine Months Year
Ended Ended Ended
12/31/03 12/31/02 3/31/02
------------ ------------ ------------
OPERATIONS:
Net investment loss................................................ $ (264,845) $ (114,519) $ (221,933)
Net realized gain (loss) on:
Investment transactions......................................... 88,319 (4,465,721) (1,624,953)
Futures transactions............................................ (1,331,563) -- --
Options contracts expired or closed............................. -- 185,076 172,850
Change in unrealized appreciation on investments and options....... 1,927,762 2,623,576 1,023,187
------------ ------------ ------------
Net increase (decrease) in net assets resulting from operations.... 419,673 (1,771,588) (650,849)
DISTRIBUTIONS TO SHAREHOLDERS:
Net realized gains ($0.00, $0.00 and $0.26 per share,
respectively)..................................................... -- -- (663,137)
------------ ------------ ------------
CAPITAL SHARE TRANSACTIONS:
Increase in net assets resulting from reinvestment of distribution
(23,964 shares)................................................... -- -- 81,842
------------ ------------ ------------
Total change in net assets...................................... 419,673 (1,771,588) (1,232,144)
NET ASSETS:
Beginning of period................................................ 6,731,316 8,502,904 9,735,048
------------ ------------ ------------
End of period...................................................... $ 7,150,989 $ 6,731,316 $ 8,502,904
============ ============ ============
See accompanying notes to financial statements.
FOXBY CORP. 7
Notes to Financial Statements
(1) Foxby Corp., formerly Internet Growth Fund, Inc.(the "Fund"), was
incorporated under the laws of the state of Maryland on August 24, 1998 and is
registered under the Investment Company Act of 1940 as a non-diversified,
closed-end management investment company. The Fund commenced operations on
October 29, 1999. On December 11, 2002, the Board of Directors of the Fund
approved a change in the fiscal year end to December 31.
(2) The following is a summary of significant accounting policies consistently
followed by the Fund in the preparation of its financial statements. With
respect to security valuation, securities traded on a national securities
exchange or the Nasdaq National Market System ("NMS") are valued at the last
reported sales price on the day the valuations are made. Such securities that
are not traded on a particular day and securities traded in the over-the-counter
market that are not on NMS are valued at the mean between the current bid and
asked prices. Certain of the securities in which the Fund invests are priced
through pricing services which may utilize a matrix pricing system which takes
into consideration factors such as yields, prices, maturities, call features and
ratings on comparable securities. Bonds may be valued according to prices quoted
by a dealer in bonds which offers pricing services. Debt obligations with
remaining maturities of 60 days or less are valued at cost adjusted for
amortization of premiums and accretion of discounts. Securities denominated in
foreign currencies are translated into U.S.dollars at prevailing exchange rates.
Securities for which quotations are not readily available or reliable and other
assets may be valued as determined in good faith by or under the direction of
the Board of Directors. Investment transactions are accounted for on the trade
date (the date the order to buy or sell is executed). Interest income is
recorded on the accrual basis. In preparing financial statements in conformity
with accounting principles generally accepted in the United States of America,
management makes estimates and assumptions that affect the reported amounts of
assets and liabilities at the date of the financial statements, as well as the
reported amounts of revenues and expenses during the reporting period. Actual
results could differ from those estimates.
(3) It is the Fund's current intention to meet the requirements of the Internal
Revenue Code applicable to regulated investment companies and to distribute all
of its taxable net income to its shareholders. In addition, the Fund intends to
pay distributions as required to avoid imposition of excise tax. Therefore, no
federal income tax provision is required. At December 31, 2003, the Fund had a
capital loss carryforward of approximately $18,104,700 of which $10,509,500
expires in 2009, $6,757,800 expires in 2010, and $837,400 expires in 2011. The
tax character of distributions paid in the year ended March 31, 2002 was
$663,137 as distributions paid from ordinary income.
As of December 31, 2003, the components of distributable earnings on a tax basis
were as follows:
Capital loss carryforward $ (18,104,670)
Unrealized appreciation 1,752,410
--------------
$ (16,352,260)
==============
(4) Effective July 12, 2002, the Fund retained CEF Advisers, Inc. as its
Investment Manager. Previously, LCM Capital Management, Inc. ("LCM") was the
manager. Under the terms of the Investment Management Agreement, the Fund pays
the Investment Manager a fee for its services at the annual rate of 1.00% of the
Fund's average daily net assets. The fee is accrued each calendar day and the
sum of the
8 FOXBY CORP.
daily fee accruals is paid monthly. The daily fee accrual is computed by
multiplying 1/365 by the annual rate and multiplying the product by the net
asset value of the Fund as of the close of business on the previous day. LCM's
fee was substantially similar. Certain officers and directors of the Fund are
officers and directors of the Investment Manager. The Fund reimbursed the
Investment Manager $55,189 for providing certain administrative and accounting
service at cost during the year ended December 31, 2003.
(5) The Fund has an arrangement with its custodian and transfer agent whereby
interest earned on uninvested cash balances was used to offset a portion of the
Fund's expenses. Purchases and sales of investment securities (excluding
short-term investments, and futures) aggregated $3,650,403 and $4,854,012,
respectively, for the year ended December 31, 2003. At December 31, 2003, gross
unrealized appreciation and depreciation of investments for tax purposes were as
follows:
Appreciation $ 1,833,834
Depreciation (81,424)
--------------
Net appreciation on investments $ 1,752,410
==============
At December 31, 2003, the cost of investments for federal income tax purposes
was $5,428,501.
(6) The Fund may engage in transactions in futures contracts. Upon entering into
a futures contract, the Fund is required to deposit with the broker an amount of
cash or cash equivalents equal to a certain percentage of the contract amount.
This is known as the "initial margin." Subsequent payments ("variation margin")
are made or received by the Fund each day, depending on the daily fluctuation of
the value of the contract. The daily change in the contract is included in
unrealized appreciation/depreciation on investments and futures contracts. The
Fund recognizes a realized gain or loss when the contract is closed. Futures
transactions sometimes may reduce returns or increase volatility. In addition,
futures can be illiquid and highly sensitive to changes in their underlying
security, interest rate or index, and as a result can be highly volatile. A
small investment in certain futures could have a potentially large impact on a
Fund's performance. At December 31, 2003 the Fund had no open future contracts.
(7) There are 500,000,000 shares of $.01 par value common stock authorized. Of
the 2,602,847 shares of common stock outstanding at December 31, 2003, Investor
Service Center, Inc. ("ISC") owned 125,300 shares. Certain officers and
directors of ISC are also officers and directors of the Fund and the Investment
Manager.
FOXBY CORP. 9
FINANCIAL HIGHLIGHTS
Year Nine Months Year Year Period
Ended Ended Ended Ended Ended
PER SHARE DATA 12/31/03 12/31/02 3/31/02 3/31/01 3/31/00*
---------- ----------- ---------- ---------- ---------
Net asset value at beginning of period........ $ 2.59 $ 3.27 $ 3.77 $ 14.81 $ 9.35
---------- ----------- ---------- ---------- ---------
Income from investment operations:
Net investment (loss)...................... (.10) (0.04) (0.08) (0.09) (0.05)
Net realized and unrealized gain (loss) on
investments............................... .26 (0.64) (0.16) (10.45)/(c)/ 5.51
---------- ----------- ---------- ---------- ---------
Total from investment operations.............. .16 (0.68) (0.24) (10.54) 5.46
---------- ----------- ---------- ---------- ---------
Less distributions:
Distributions to shareholders.............. -- -- (0.26) (0.50) --
---------- ----------- ---------- ---------- ---------
Net asset value at end of period.............. $ 2.75 $ 2.59 $ 3.27 $ 3.77 $ 14.81
---------- ----------- ---------- ---------- ---------
TOTAL RETURN ON NET ASSET VALUE BASIS (a)..... 6.18% (20.80)% (6.65)% (73.46)% 58.40%
========== =========== ========== ========== =========
TOTAL RETURN ON MARKET VALUE BASIS (a)........ 15.94% (31.00)% (2.06)% (71.89)% 24.38%
========== =========== ========== ========== =========
RATIOS/SUPPLEMENTAL DATA
Net assets at end of period (000's omitted)... $ 7,151 $ 6,731 $ 8,503 $ 9,735 $ 39,105
========== =========== ========== ========== =========
Ratio of expenses to average net assets....... 4.39% 4.70%/(b)/ 3.17% 2.19% 1.78%/(b)/
========== =========== ========== ========== =========
Ratio of net investment income (loss) to
average net assets........................... (3.91)% (3.30)%/(b)/ (2.41)% (0.93)% (0.94)%/(b)/
========== =========== ========== ========== =========
Portfolio turnover rate....................... 75.39% 267.87% 89.31% 550.56% 168.62%
========== =========== ========== ========== =========
* From commencement of operations on October 29, 1999.
(a) Total return on market value basis is calculated assuming a purchase of
common stock on the opening of the first day and sale on the closing of the
last day of each period reported. Dividends and distributions, if any, are
assumed for purposes of this calculation, to be reinvested at prices
obtained under the Fund's dividend reinvestment plan. Generally, total
return on net asset value basis will be higher than total return on market
value basis in periods where there is an increase in the discount or a
decrease in the premium of the market value to the net asset value from the
beginning to the end of such periods. Conversely, total return on net asset
value basis will be lower than total return on market value basis in
periods where there is a decrease in the discount or an increase in the
premium of the market value to the net asset value from the beginning to
the end of such periods. Total return calculated for a period of less than
one year is not annualized. The calculation does not reflect brokerage
commissions, if any.
(b) Annualized.
(c) Includes $0.06 of gains resulting from the buy back of treasury shares at a
discount to net asset value.
10 FOXBY CORP.
REPORT OF INDEPENDENT PUBLIC ACCOUNTANT
To the Board of Directors and Shareholders of Foxby Corp.:
We have audited the accompanying statement of assets and liabilities of Foxby
Corp. (formerly Internet Growth Fund, Inc.) (the "Fund"), including the schedule
of investments as of December 31, 2003, the related statement of operations for
the year then ended, and the statement of changes in net assets and the
financial highlights for the year then ended, the nine months ended December 31,
2002 and the year ended March 31, 2002. These financial statements and financial
highlights are the responsibility of the Fund's management. Our responsibility
is to express an opinion on these financial statements and financial highlights
based on our audit. The financial highlights for the year ended March 31, 2001
and the period ended March 31, 2000 were audited by other auditors whose report
dated May 14, 2001 expressed an unqualified opinion on the statement of changes
in net assets and the financial highlights.
We conducted our audit in accordance with auditing standards generally accepted
in the United States of America. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the financial
statements and financial highlights are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements. Our procedures included confirmation of
securities owned as of December 31, 2003 by correspondence with the custodian.
An audit also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audit provides a reasonable basis
for our opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of Foxby
Corp. as of December 31, 2003, the results of its operations, the changes in its
net assets, and the financial highlights for the periods noted above, in
conformity with accounting principles generally accepted in the United States of
America.
TAIT, WELLER & BAKER
Philadelphia, Pennsylvania
January 22, 2004
FOXBY CORP. 11
RESULTS OF THE ANNUAL MEETING
The Fund's Annual Meeting was held on September 12, 2003 at the offices of the
Fund at 11 Hanover Square, New York, New York for the purpose of electing the
following director to serve as follows with the votes received as set forth
below:
Director Class Term Expiring Votes For Votes Withheld
--------------- ----- ------- -------- ------------- --------------
George B. Langa 1 4 years 2007 2,360,936.598 126,171.190
Directors whose term of office continued after the meeting are David R. Stack,
Peter K. Werner, and Thomas B. Winmill.
RESULTS OF THE SPECIAL MEETING
The Fund's Special Meeting of Shareholders adjourned to October 28, 2003:
1. To consider a proposal to modify the Fund's fundamental investment
objective.
Votes For Votes Against Abstentions
------------- ------------- -----------
1,016,522.034 334,119.169 23,527.585
2. To consider a proposal to modify the Fund's fundamental investment
restriction on industry concentration.
Votes For Votes Against Abstentions
------------- ------------- -----------
997,970.034 342,635.169 33,563.585
3. To consider proposals to modify:
a. The Fund's fundamental investment restriction on investing in
commodities.
Votes For Votes Against Abstentions
------------- ------------- -----------
929,490.598 409,452.190 35,227.000
b. The Fund's fundamental investment restriction on loans.
Votes For Votes Against Abstentions
------------- ------------- -----------
966,577.598 359,949.190 47,641.000
12 FOXBY CORP.
DIVIDEND REINVESTMENT PLAN
The Fund has adopted a Dividend Reinvestment Plan (the "Plan"). Under the Plan,
each dividend and capital gain distribution, if any, declared by the Fund on
outstanding shares will, unless elected otherwise by each shareholder by
notifying the Fund in writing at any time prior to the record date for a
particular dividend or distribution, be paid on the payment date fixed by the
Board of Directors or a committee thereof in additional shares. If the Market
Price (as defined below) per share is equal to or exceeds the net asset value
per share at the time shares are valued for the purpose of determining the
number of shares equivalent to the cash dividend or capital gain distribution
(the "Valuation Date"), participants will be issued additional shares equal to
the amount of such dividend divided by the greater of that net asset value per
share or 95% of that Market Price per share. If the Market Price per share is
less than such net asset value on the Valuation Date, participants will be
issued additional shares equal to the amount of such dividend divided by the
Market Price. The Valuation Date is the day before the dividend or distribution
payment date or, if that day is not an American Stock Exchange trading day, the
next trading day. For all purposes of the Plan: (a) the Market Price of the
shares on a particular date shall be the average closing market price on the
five trading days the shares traded ex-dividend on the Exchange prior to such
date or, if no sale occurred on any of these days, then the mean between the
closing bid and asked quotations, for the shares on the Exchange on such day,
and (b) net asset value per share on a particular date shall be as determined by
or on behalf of the Fund.
--------------------------------------------------------------------------------
PRIVACY POLICY
The Fund recognizes the importance of protecting the personal and financial
information of its shareholders. We consider each shareholder's personal
information to be private and confidential. This describes the practices
followed by us to protect our shareholders' privacy. We may obtain information
about you from the following sources: (1) information we receive from you on
forms and other information you provide to us whether in writing, by telephone,
electronically or by any other means; (2) information regarding your
transactions with us, our corporate affiliates, or others. We do not sell
shareholder personal information to third parties. We will collect and use
shareholder personal information only to service shareholder accounts. This
information may be used by us in connection with providing services or financial
products requested by shareholders. We will not disclose shareholder personal
information to any nonaffiliated third party except as permitted by law. We take
steps to safeguard shareholder information. We restrict access to nonpublic
personal information about you to those employees and service providers who need
to know that information to provide products or services to you. With our
service providers we maintain physical, electronic, and procedural safeguards to
guard your nonpublic personal information. Even if you are no longer a
shareholder, our Privacy Policy will continue to apply to you. We reserve the
right to modify, remove or add portions of this Privacy Policy at any time.
FOXBY CORP. 13
DIRECTORS AND OFFICERS
DIRECTORS OFFICERS
THOMAS B. WINMILL, Esq. THOMAS B. WINMILL, Esq.
Chairman President
GEORGE B. LANGA/1/
DAVID R. STACK/1/ MARION E. MORRIS
PETER K. WERNER/1/ Senior Vice President
WILLIAM G. VOHRER
Treasurer
/1/Member, Audit Committee MONICA PELAEZ, Esq.
Vice President, Secretary
HEIDI KEATING
Vice President
Investment Manager Custodian
CEF Advisers, Inc. State Street Bank & Trust Co.
11 Hanover Square 801 Pennsylvania Avenue
New York, NY 10005 Kansas City, MO 64105
Independent Accountants Stock Transfer Agent and Registrar
Tait, Weller & Baker American Stock Transfer & Trust Co.
1818 Market St., Suite 2400 59 Maiden Lane
Philadelphia, PA 19103 New York, NY 10038
1-800-278-4353
Internet www.amstock.com
www.foxbycorp.com
email: info@foxbycorp.com
--------------------------------------------------------------------------------
PROXY VOTING
The Fund's Proxy Voting Guidelines (the "Guidelines") are available without
charge, by calling the Fund collect at 1-212-635-0671. The Guidelines are also
posted on the Fund's website at http://www.foxbycorp.com and are available on
the SEC's website at http://sec.gov.
----------------------------------------------------------------------
This report, including the financial statements herein, is transmitted
to the shareholders of the Fund for their information. The financial
information included herein is taken from the records of the Fund.
This is not a prospectus, circular or representation intended for use
in the purchase of shares of the Fund or any securities mentioned in
this report. Pursuant to Section 23 of the Investment Company Act of
1940, notice is hereby given that the Fund may in the future, purchase
shares of its own shares. These purchases may be made from time to
time, at such times, and in such amounts, as may be deemed
advantageous to the Fund, although nothing herein shall be considered
a commitment to purchase such shares.
----------------------------------------------------------------------
14 FOXBY CORP.
FOXBY CORP.
--------------------------------------------------------------------------------
11 Hanover Square
New York, NY 10005
Printed on recycled paper [LOGO]
FXX-AR-12/03
Item 2. Code of Ethics
(a) The registrant has adopted a code of ethics (the "Code") that applies to
its principal executive officer, principal financial officer, principal
accounting officer or controller, or persons performing similar functions,
regardless of whether these individuals are employed by the Fund or a third
party.
(b) No information need be disclosed pursuant to this paragraph.
(c) Not applicable.
(d) Not applicable.
(e) Not applicable.
(f) (1) The Code is attached hereto as Exhibit 99.CODE ETH.
(2) The text of the Code can be on the registrant's website,
www.foxbycorp.com.
(3) A copy of the Code may be obtained free of charge by calling collect
1-212-344-6310.
Item 3. Audit Committee Financial Expert
The Fund's Board of Directors has determined that it has three "audit committee
financial experts" serving on its audit committee, each of whom are
"independent" Directors: George B. Langa, David R. Stack and Peter K. Werner.
Under applicable securities laws, a person who is determined to be an audit
committee financial expert will not be deemed an "expert" for any purpose,
including without limitation for the purposes of Section 11 of the Securities
Act of 1933, as a result of being designated or identified as an audit committee
financial expert. The designation or identification of a person as an audit
committee financial expert does not impose on such person any duties,
obligations, or liabilities that are greater than the duties, obligations, and
liabilities imposed on such person as a member of the audit committee and Board
of Directors in the absence of such designation or identification.
Item 4. Principal Accountant Fees and Services
(a) - (d) Aggregate fees billed to the registrant for the last two fiscal years
for professional services rendered by the registrant's principal accountant were
as follows:
2003 2002
Audit Fees $ 11,000 $ 13,000
Audit-Related Fees 0 0
Tax Fees 2,500 3,750
All Other Fees 0 0
Audit fees include amounts related to the audit of the registrant's annual
financial statements and services normally provided by the accountant in
connection with statutory and regulatory filings. Audit-related fees include
amounts reasonably related to the performance of the audit of the registrant's
financial statements, specifically the issuance of a report on internal
controls. Tax fees include amounts related to tax compliance, tax planning, and
tax advice. Other fees include the registrant's pro-rata share of amounts for
agreed-upon procedures in conjunction with service contract approvals by the
registrant's Board of Directors.
(e) (1) The registrant's audit committee has adopted a policy to consider for
pre-approval any non-audit services proposed to be provided by the
auditors to the Fund, and any non-audit services proposed to be
provided by such auditors to the Fund's investment manager, if any,
which have a direct impact on Fund operations or financial reporting.
Such pre-approval of non-audit services proposed to be provided by the
auditors to the Fund is not necessary, however, under the following
circumstances: (1) all such services do not aggregate to more than 5%
of total revenues paid by the Fund to the auditor in the fiscal year
in which services are provided, (2) such services were not recognized
as non-audit services at the time of the engagement, and (3) such
services are brought to the attention of the Audit Committee, and
approved by the Audit Committee, prior to the completion of the audit.
(2) No services included in (b) - (d) above were approved pursuant to
paragraph (c)(7)(i)(C) of Rule 2-01 of Regulation S-X.
(f) Not applicable.
(g) The aggregate fees billed for the most recent fiscal year and the preceding
fiscal year by the registrant's principal accountant for non-audit services
rendered to the registrant, its investment adviser, and any entity
controlling, controlled by, or under common control with the investment
adviser that provides ongoing services to the registrant were $20,750 and
$22,750, respectively.
(h) All non-audit services rendered in (g) above were pre-approved by the
registrant's audit committee. Accordingly, these services were considered
by the registrant's audit committee in maintaining the principal
accountant's independence.
Item 5. Audit Committee of Listed Registrants
The registrant has a standing audit committee. The members of the audit
committee are George B. Langa, David R. Stack and Peter K. Werner.
Item 6. Reserved
Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End
Management Investment Companies
Amended Proxy Voting Policies and Procedures
Foxby Corp.
Global Income Fund, Inc.
Midas Fund, Inc.
Midas Special Equities Fund, Inc.
Tuxis Corporation
Foxby Corp., Global Income Fund, Inc., Midas Fund, Inc., Midas Special Equities
Fund, Inc. and Tuxis Corporation (the "Funds") delegate the responsibility for
voting proxies of portfolio companies held in each Fund's portfolio to
Institutional Shareholder Services, Inc. ("ISS"). The Proxy Voting Guidelines of
ISS are incorporated by reference herein as each Fund's proxy voting policies
and procedures, as supplemented by the terms hereof. Each Fund retains the right
to override the delegation to ISS on a case-by-case basis, in which case the
ADDENDUM -- NON-DELEGATED PROXY VOTING POLICIES AND PROCEDURES supercede the
Proxy Voting Guidelines of ISS in their entirety. In all cases, a Fund's proxies
will be voted in the best interests of the Fund.
With respect to a vote upon which a Fund overrides the delegation to ISS,
to the extent that such vote presents a material conflict of interest between
the Fund and its investment adviser, distributor, or any affiliated person of
the Fund's investment adviser or distributor, the Fund will disclose such
conflict to, and obtain consent from, its Independent Directors, or a committee
thereof, prior to voting the proxy.
January 1, 2004
--------
1 For the open-end investment companies, Midas Fund, Inc. and Midas Special
Equities Fund, Inc., the investment adviser is Midas Management Corporation and
the distributor is Investor Service Center, Inc. For Foxby Corp. and Global
Income Fund, Inc., the investment adviser is CEF Advisers, Inc. Tuxis
Corporation is internally managed. The closed-end funds, Foxby Corp., Global
Income Fund, Inc. and Tuxis Corporation, do not have a distributor.
2 Each Fund's Independent Directors are those directors who are not interested
persons of the Fund, its investment adviser and distributor.
ADDENDUM --
NON-DELEGATED PROXY VOTING POLICIES AND PROCEDURES
These proxy voting policies and procedures are intended to provide general
guidelines regarding the issues they address. As such, they cannot be
"violated." In each case the vote will be based on maximizing shareholder value
over the long term, as consistent with overall investment objectives and
policies.
BOARD AND GOVERNANCE ISSUES
o Board of Director Composition
Typically, we will not object to slates with at least a majority of independent
directors.
We generally will not object to shareholder proposals that request that the
board audit, compensation and/or nominating committees include independent
directors exclusively.
o Approval of Independent Auditors
We will evaluate on a case-by-case basis instances in which the audit firm has a
significant audit relationship with the company to determine whether we believe
independence has been compromised.
We will review and evaluate the resolutions seeking ratification of the auditor
when fees for financial systems design and implementation substantially exceed
audit and all other fees, as this can compromise the independence of the
auditor.
We will carefully review and evaluate the election of the audit committee chair
if the audit committee recommends an auditor whose fees for financial systems
design and implementation substantially exceed audit and all other fees, as this
can compromise the independence of the auditor.
o Increase Authorized Common Stock
We will generally support the authorization of additional common stock necessary
to facilitate a stock split.
We will generally support the authorization of additional common stock.
o Blank Check Preferred Stock
Blank check preferred is stock with a fixed dividend and a preferential claim on
company assets relative to common shares. The terms of the stock (voting,
dividend and conversion rights) are determined at the discretion of the Board
when the stock is issued. Although such an issue can in theory be used for
financing purposes, often it has been used in connection with a takeover
defense. Accordingly, we will generally evaluate the creation of blank check
preferred stock.
o Classified or "Staggered" Board
On a classified (or staggered) board, directors are divided into separate
classes (usually three) with directors in each class elected to overlapping
three-year terms. Companies argue that such Boards offer continuity in direction
which promotes long-term planning. However, in some instances they may serve to
deter unwanted takeovers since a potential buyer would have to wait at least two
years to gain a majority of Board seats.
We will vote on a case-by-case basis on issues involving classified boards.
o Supermajority Vote Requirements
Supermajority vote requirements in a company's charter or bylaws require a level
of voting approval in excess of simple majority. Generally, supermajority
provisions require at least 2/3 affirmative vote for passage of issues.
We will vote on a case-by-case basis regarding issues involving supermajority
voting.
o Restrictions on Shareholders to Act by Written Consent
Written consent allows shareholders to initiate and carry out a shareholder
action without waiting until the annual meeting or by calling a special meeting.
It permits action to be taken by the written consent of the same percentage or
outstanding shares that would be required to effect the proposed action at a
shareholder meeting.
We will generally not object to proposals seeking to preserve the right of
shareholders to act by written consent.
o Restrictions on Shareholders to Call Meetings
We will generally not object to proposals seeking to preserve the right of the
shareholders to call meetings.
o Limitations, Director Liability and Indemnification
Because of increased litigation brought against directors of corporations and
the increase costs of director's liability insurance, many states have passed
laws limiting director liability for those acting in good faith. Shareholders,
however, often must opt into such statutes. In addition, many companies are
seeking to add indemnification of directors to corporate bylaws.
We will generally support director liability and indemnification resolutions
because it is important for companies to be able to attract the most qualified
individuals to their Boards.
o Reincorporation
Corporations are in general bound by the laws of the state in which they are
incorporated. Companies reincorporate for a variety of reasons including
shifting incorporation to a state where the company has its most active
operations or corporate headquarters, or shifting incorporation to take
advantage of state corporate takeovers laws.
We typically will not object to reincorporation proposals.
o Cumulative Voting
Cumulative voting allows shareholders to cumulate their votes behind one or a
few directors running for the board - that is, cast more than one vote for a
director thereby helping a minority of shareholders to win board representation.
Cumulative voting generally gives minority shareholders an opportunity to effect
change in corporate affairs.
We typically will not object to proposals to adopt cumulative voting in the
election of directors.
o Dual Classes of Stock
In order to maintain corporate control in the hands of a certain group of
shareholders, companies may seek to create multiple classes of stock with
differing rights pertaining to voting and dividends.
We will vote on a case-by-case basis dual classes of stock. However, we will
typically not object to dual classes of stock.
o Limit Directors' Tenure
In general, corporate directors may stand for re-election indefinitely.
Opponents of this practice suggest that limited tenure would inject new
perspectives into the boardroom as well as possibly creating room for directors
from diverse backgrounds; however, continuity is important to corporate
leadership and in some instances alternative means may be explored for injecting
new ideas or members from diverse backgrounds into corporate boardrooms.
Accordingly, we will vote on a case-by-case basis regarding attempts to limit
director tenure.
o Minimum Director Stock Ownership
The director share ownership proposal requires that all corporate directors own
a minimum number of shares in the corporation. The purpose of this resolution is
to encourage directors to have the same interest as other shareholders.
We normally will not object to resolutions that require corporate directors to
own shares in the company.
EXECUTIVE COMPENSATION
o Disclosure of CEO, Executive, Board and Management Compensation
On a case-by-case basis, we will support shareholder resolutions requesting
companies to disclose the salaries of top management and the Board of Directors.
o Compensation for CEO, Executive, Board and Management
We typically will not object to proposals regarding executive compensation if we
believe the compensation clearly does not reflect the current and future
circumstances of the company.
o Formation and Independence of Compensation Review Committee
We normally will not object to shareholder resolutions requesting the formation
of a committee of independent directors to review and examine executive
compensation.
o Stock Options for Board and Executives
We will generally review the overall impact of stock option plans that in total
offer greater than 25% of shares outstanding because of voting and earnings
dilution.
We will vote on a case-by-case basis option programs that allow the repricing of
underwater options.
In most cases, we will oppose stock option plans that have option exercise
prices below the marketplace on the day of the grant.
Generally, we will support options programs for outside directors subject to the
same constraints previously described.
o Employee Stock Ownership Plan (ESOPs)
We will generally not object to ESOPs created to promote active employee
ownership. However, we will generally oppose any ESOP whose purpose is to
prevent a corporate takeover.
o Changes to Charter or By-Laws
We will conduct a case-by-case review of the proposed changes with the voting
decision resting on whether the proposed changes are in shareholder's best
interests.
o Confidential Voting
Typically, proxy voting differs from voting in political elections in that the
company is made aware of shareholder votes as they are cast. This enables
management to contact dissenting shareholders in an attempt to get them to
change their votes.
We generally will not object to confidential voting.
o Equal Access to Proxy
Equal access proposals ask companies to give shareholders access to proxy
materials to state their views on contested issues, including director
nominations. In some cases they would actually allow shareholders to nominate
directors. Companies suggest that such proposals would make an increasingly
complex process even more burdensome.
In general, we will not oppose resolutions for equal access proposals.
o Golden Parachutes
Golden parachutes are severance payments to top executives who are terminated or
demoted pursuant to a takeover. Companies argue that such provisions are
necessary to keep executives from "jumping ship" during potential takeover
attempts.
We will not object to the right of shareholders to vote on golden parachutes
because they go above and beyond ordinary compensation practices. In evaluating
a particular golden parachute, we will examine if considered material total
management compensation, the employees covered by the plan, and the quality of
management and all other factors deemed pertinent.
MERGERS AND ACQUISITIONS
o Mergers, Restructuring and Spin-offs
A merger, restructuring, or spin-off in some way affects a change in control of
the company's assets. In evaluating the merit of each issue, we will consider
the terms of each proposal. This will include an analysis of the potential
long-term value of the investment.
On a case by case basis, we will review management proposals for merger or
restructuring to determine the extent to which the transaction appears to offer
fair value and other proxy voting policies stated are not violated.
o Poison Pills
Poison pills (or shareholder rights plans) are triggered by an unwanted takeover
attempt and cause a variety of events to occur which may make the company
financially less attractive to the suitor. Typically, directors have enacted
these plans without shareholder approval. Most poison pill resolutions deal with
putting poison pills up for a vote or repealing them altogether.
We typically will not object to most proposals to put rights plans up for a
shareholder vote. In general, poison pills will be reviewed for the additional
value provided to shareholders, if any.
o Anti-Greenmail Proposals
Greenmail is the payment a corporate raider receives in exchange for his/her
shares. This payment is usually at a premium to the market price, so while
greenmail can ensure the continued independence of the company, it discriminates
against other shareholders.
We generally will support anti-greenmail provisions.
o Opt-Out of State Anti-takeover Law
A strategy for dealing with anti-takeover issues has been a shareholder
resolution asking a company to opt-out of a particular state's anti-takeover
laws.
We generally will not object to bylaws changes requiring a company to opt out of
state anti-takeover laws. Resolutions requiring companies to opt into state
anti-takeover statutes generally will be subject to further review for
appropriateness.
o Other Situations
In the event an issue is not addressed in the above guidelines, we will
determine on a case-by-case basis any proposals that may arise from management
or shareholders. To the extent that a proposal from management does not infringe
on shareholder rights, we will generally support management's position. We may
also elect to abstain or not vote on any given matter.
January 1, 2004
ISS Proxy Voting Guidelines Summary
Following is a concise summary of ISS's proxy voting policy guidelines.
1. Auditors
Vote CASE-BY-CASE on shareholder proposals on auditor rotation, taking into
account these factors:
o Tenure of the audit firm
o Establishment and disclosure of a renewal process whereby the auditor is
regularly evaluated for both audit quality and competitive price
o Length of the rotation period advocated in the proposal
o Significant audit-related issues
2. Board of Directors
Voting on Director Nominees in Uncontested Elections
Generally, vote CASE-BY-CASE. But WITHHOLD votes from:
o Insiders and affiliated outsiders on boards that are not at least majority
independent
o Directors who sit on more than six boards
o Compensation Committee members if there is a disconnect between the CEO's pay
and performance
Classification/Declassification of the Board
Vote AGAINST proposals to classify the board.
Vote FOR proposals to repeal classified boards and to elect all directors
annually.
Independent Chairman (Separate Chairman/CEO)
Vote FOR shareholder proposals asking that the chairman and CEO positions be
separated (independent chairman), unless the company has a strong countervailing
governance structure, including a lead director, two-thirds independent board,
all independent key committees, and established governance guidelines.
Majority of Independent Directors/Establishment of Committees
Vote FOR shareholder proposals asking that a majority or more of directors be
independent unless the board composition already meets the proposed threshold by
ISS's definition of independence.
Open Access (shareholder resolution)
Vote CASE-BY-CASE basis, taking into account the ownership threshold proposed in
the resolution and the proponent's rationale.
3. Shareholder Rights
Shareholder Ability to Act by Written Consent
Vote against proposals to restrict or prohibit shareholder ability to take
action by written consent. Vote for proposals to allow or make easier
shareholder action by written consent.
Shareholder Ability to Call Special Meetings
Vote against proposals to restrict or prohibit shareholder ability to call
special meetings. Vote for proposals that remove restrictions on the right of
shareholders to act independently of management.
Supermajority Vote Requirements
Vote AGAINST proposals to require a supermajority shareholder vote.
Vote FOR proposals to lower supermajority vote requirements.
Cumulative Voting
Vote against proposals to eliminate cumulative voting. Vote proposals to restore
or permit cumulative voting on a case-by-case basis relative to the company's
other governance provisions.
Confidential Voting
Vote FOR shareholder proposals requesting that corporations adopt confidential
voting, use independent vote tabulators and use independent inspectors of
election. In proxy contests, support confidential voting proposals only if
dissidents agree to the same policy that applies to management.
4. Proxy Contests
Voting for Director Nominees in Contested Elections
Votes in a contested election of directors must be evaluated on a CASE-BY-CASE
basis, considering the factors that include the long-term financial performance,
management's track record, qualifications of director nominees (both slates),
and an evaluation of what each side is offering shareholders.
Reimbursing Proxy Solicitation Expenses
Vote CASE-BY-CASE. Where ISS recommends in favor of the dissidents, we also
recommend voting for reimbursing proxy solicitation expenses.
5. Poison Pills
Vote for shareholder proposals that ask a company to submit its poison
pill for shareholder ratification. Review on a case-by-case basis shareholder
proposals to redeem a company's poison pill and management proposals to ratify a
poison pill.
6. Mergers and Corporate Restructurings
Vote CASE-BY-CASE on mergers and corporate restructurings based on such features
as the fairness opinion, pricing, strategic rationale, and the negotiating
process.
7. Reincorporation Proposals
Proposals to change a company's state of incorporation should be evaluated on a
CASE-BY-CASE basis, giving consideration to both financial and corporate
governance concerns, including the reasons for reincorporating, a comparison of
the governance provisions, and a comparison of the jurisdictional laws.
Vote FOR reincorporation when the economic factors outweigh any neutral or
negative governance changes.
8. Capital Structure
Common Stock Authorization
Votes on proposals to increase the number of shares of common stock authorized
for issuance are determined on a CASE-BY-CASE basis using a model developed by
ISS.
Vote AGAINST proposals at companies with dual-class capital structures to
increase the number of authorized shares of the class of stock that has superior
voting rights.
Vote FOR proposals to approve increases beyond the allowable increase when a
company's shares are in danger of being delisted or if a company's ability to
continue to operate as a going concern is uncertain.
Dual-class Stock
Vote AGAINST proposals to create a new class of common stock with superior
voting rights.
Vote FOR proposals to create a new class of nonvoting or
subvoting common stock if:
o It is intended for financing purposes with minimal or no dilution to current
shareholders
o It is not designed to preserve the voting power of an insider or significant
shareholder
9. Executive and Director Compensation
ISS applies a quantitative methodology, but for Russell 3000 companies will also
apply a pay-for-performance overlay in assessing equity-based compensation
plans.
Vote AGAINST a plan if the cost exceeds the allowable cap.
Vote FOR a plan if the cost is reasonable (below the cap) unless either of the
following conditions apply:
o The plan expressly permits repricing without shareholder approval for listed
companies; or
o There is a disconnect between the CEO's pay and performance (an increase in
pay and a decrease in performance), the main source for the pay increase is
equity-based, and the CEO participates in the plan being voted on.
Management Proposals Seeking Approval to Reprice Options
Votes on management proposals seeking approval to reprice options are evaluated
on a CASE-BY-CASE basis giving consideration to the following:
o Historic trading patterns
o Rationale for the repricing
o Value-for-value exchange
o Option vesting
o Term of the option
o Exercise price
o Participation
Employee Stock Purchase Plans
Votes on employee stock purchase plans should be determined on a CASE-BY-CASE
basis.
Vote FOR employee stock purchase plans where all of the following apply:
o Purchase price is at least 85 percent of fair market value
o Offering period is 27 months or less, and
o Potential voting power dilution (VPD) is 10 percent
or less.
Vote AGAINST employee stock purchase plans where any of the opposite
conditions obtain.
Shareholder Proposals on Compensation
Generally vote CASE-BY-CASE, taking into account company performance, pay level
versus peers, pay level versus industry, and long term corporate outlook. But
generally vote FOR shareholder proposals that:
o Advocate performance-based equity awards (indexed options, premium-priced
options, performance-vested awards), unless the proposal is overly restrictive
or the company already substantially uses such awards
o Call for a shareholder vote on extraordinary benefits contained in
Supplemental Executive Retirement Plans (SERPs).
10. Social and Environmental Issues
These issues cover a wide range of topics, including consumer and public safety,
environment and energy, general corporate issues, labor standards and human
rights, military business, and workplace diversity.
In general, vote CASE-BY-CASE. While a wide variety of factors goes into each
analysis, the overall principal guiding all vote recommendations focuses on how
the proposal will enhance the economic value of the company.
Vote:
o FOR proposals for the company to amend its Equal Employment Opportunity (EEO)
Statement to include reference to sexual orientation, unless the change would
result in excessive costs for the company.
o AGAINST resolutions asking for the adopting of voluntary labeling of
ingredients or asking for companies to label until a phase out of such
ingredients has been completed.
Item 8. Reserved
Item 9. Controls and Procedures
(a)(i) The Principal Executive Officer and Principal Financial Officer have
concluded that Foxby Corp.'s disclosure controls and procedures (as defined in
Rule 30a-2(c) under the Investment Company Act) provide reasonable assurances
that material information relating to Foxby Corp. is made known to them by the
appropriate persons, based on their evaluation of these controls and procedures
as of a date within 90 days of the filing date of this report.
(a)(ii) There were no significant changes in Foxby Corp. internal controls or in
other factors that could significantly affect these controls subsequent to the
date of the evaluation referenced in (a)(i) above.
Item 10. Exhibits
(a) Code of Ethics for Principal Executive and Senior Financial Officers
attached hereto as Exhibit 99.CODE ETH.
(b) Certifications pursuant to Rule 30a-2 under the Investment Company Act of
1940(17 CFR 270.30a-2) attached hereto as Exhibit 99.CERT.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, the registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.
Foxby Corp.
By: /s/ Thomas B. Winmill
---------------------------------------------
Thomas B. Winmill, President
Date: March 10, 2004
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, the registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.
Foxby Corp.
By: /s/ William G. Vohrer
---------------------------------------------
William G. Vohrer, Treasurer
Date: March 10, 2004