SEC Company Response from Invesco California Value Municipal Income Trust (VCV) (CIK 0000895531) (VCV) — Feb 26, 2010
Invesco California Value Municipal Income Trust (VCV) (CIK 0000895531)
Date: Feb. 26, 2010 · CIK: 0000895531 · Accession: 0000950123-10-018042
AI Filing Summary & Sentiment
Show Raw Text
CORRESP
1
filename1.htm
corresp
Skadden,
Arps, Slate, Meagher & Flom llp
155 NORTH WACKER DRIVE
CHICAGO, ILLINOIS
60606
FIRM/AFFILIATE
OFFICES
BOSTON
HOUSTON
LOS ANGELES
February 26,
2010
NEW YORK
PALO ALTO
SAN FRANCISCO
WASHINGTON, D.C.
WILMINGTON
BEIJING
BRUSSELS
FRANKFURT
HONG KONG
LONDON
MOSCOW
MUNICH
PARIS
SÃO PAULO
SHANGHAI
SINGAPORE
SYDNEY
TOKYO
TORONTO
VIENNA
Mr. Larry Greene
Senior Counsel
Securities and Exchange Commission
Office of Investment Management
100 F Street, N.E.
Washington, DC 20549
RE: Van Kampen Joint Closed-End Fund Proxy
Dear Mr. Greene:
Thank you for your telephonic comments regarding the preliminary proxy statement filed by the
several Van Kampen closed-end funds (the “Funds”) on January 22, 2010 pursuant to Section 14(a) of
the Securities Exchange Act of 1934, as amended (the “Exchange Act”). On behalf of the Funds, we
have provided our response to your comments below. Where changes were necessary in response to
your comments, they are reflected in the Funds’ definitive proxy statement which will be filed
under the Exchange Act via IDEA on or about February 26, 2010.
Comment 1
Please confirm that the type size in the proxy statement meets the requirements of Rule 14a-5 of the Exchange Act.
Response 1
The Funds confirm that the type size meets the requirements of Rule 14a-5 of the Exchange Act.
Comment 2
With respect to the answer to the fourth Q&A, please supplementally explain by whom the portfolio managers will be
employed after the Transaction.
Response 2
The portfolio managers for each of the Funds currently are employees of Van Kampen Asset Management or an affiliate
thereof. Upon consummation of the Transaction, the Funds expect that all such portfolio managers, except the
portfolio managers for Van Kampen Bond Fund and Van Kampen High Income Trust II, will become employees of
1
Invesco
Advisers or an affiliate thereof and continue to manage the fund that they currently manage. The current portfolio
managers for Van Kampen Bond Fund are not expected to become employees of Invesco Advisers or an affiliate thereof
after the Transaction and thus, it is expected that such Fund will change its portfolio managers upon consummation
of the Transaction to portfolio managers that are currently employed by Invesco Advisers or an affiliate thereof.
With respect to Van Kampen High Income Trust II, it is expected that only one of the two current portfolio managers
will become an employee of Invesco Advisers or an affiliate thereof and continue to manage such Fund. The Funds
note that this information is currently disclosed in the section entitled “Background and the Transaction – Board
Considerations.”
Comment 3
In the answer to the fifth Q&A, please clarify the purpose of the second sentence.
Response 3
The Funds have clarified the disclosure as requested.
Comment 4
Please prominently disclose the second to last sentence in the eighth paragraph in the section entitled
“Introduction – Voting” by use of bold face type.
Response 4
The Funds have added bold face type to the sentence referenced as requested.
Comment 5
With respect to disclosure in the twelfth paragraph in the section entitled “Introduction – Voting,” please add
disclosure regarding how the Funds intend to treat abstentions and broker non-votes for purposes of an adjournment
of the shareholder meeting.
Response 5
The Funds respectfully note that the following disclosure currently appears in the section referenced [emphasis
added]:
In the event a quorum is present at the Meeting but sufficient votes to approve any of the proposals with
respect to one or more funds or
proposals are not received, proxies (including abstentions and broker
non-votes, if any) would be voted in favor of one or more adjournments if
the Meeting of the concerned fund with respect to such proposal to permit
further solicitation of proxies....
Thus, the Funds have not added any additional disclosure.
Comment 6
With respect to the disclosure in the section entitled
“Background and the Transaction – Other Service Providers,”
please confirm that there are no material changes in the
service features to shareholders proposed to be provided by
Invesco that are not currently disclosed.
Response 6
The Funds believe that Invesco and its affiliates will provide
similar services to shareholders of each Fund, which the Funds
have disclosed in the section referenced. Thus, the Funds
have not added any additional disclosure.
2
Comment 7
With respect to the disclosure in the section entitled
“Background and the Transaction – Other Service Providers,”
please confirm that none of the Funds are subject to ongoing
distribution agreements that would terminate automatically
upon assignment. To the extent that any such ongoing
distribution agreements are impacted by the Transaction,
please add appropriate disclosure to the proxy statement.
Response 7
The Van Kampen Senior Loan is the only Fund that is a party to
an ongiong distribution agreement. The Board of Trustees of
such Fund has approved a distribution agreement with an
affiliate of Invesco that is substantially similar to the
distribution agreement that such Fund has with an affiliate of
Van Kampen Asset Management. The Fund has added additional
disclosure to the proxy statement as requested.
Comment 8
In the fourth paragraph in the section entitled “Background
and the Transaction,” please delete the following sentence:
“[o]ne condition to the closing of the Transaction is that
clients and/or fund shareholders representing a certain
percentage of total assets transferred to Invesco approve the
proposals related to such investors’ participation in the
Transaction.”
Response 8
The Funds respectfully acknowledge the comment, but believe
that the disclosure referenced presents material information
regarding the Transaction that a shareholder of the Funds
should know. Thus, the Funds opt to retain the disclosure,
although the Funds have revised such disclosure to be more
clear.
Comment 9
In the first paragraph in the section entitled “Background and
the Transaction – Invesco and its Affiliates,” please revise
the disclosure regarding Invesco to be less promotional.
Response 9
The Funds have revised the disclosure as requested.
Comment 10
In the section entitled “Background and the Transaction –
Section 15(f) of the 1940 Act,” please add disclosure that the
consummation of the Transaction will constitute a change of
control and an assignment of the investment advisory contracts
for the Funds.
Response 10
The Funds have added the disclosure as requested.
Comment 11
With respect to board consideration 5 disclosed in the section
entitled “Background and the Transaction – Board
Considerations,” please add disclosure regarding any
exceptions or expenses that would not be included in the
two-year contractual guaranty that will limit the total
expense ratio of each Fund to such Fund’s total expense ratio
prior to the Transaction.
Response 11
The Funds have added disclosure as requested.
3
Comment 12
With respect to board consideration 7 disclosed in the section
entitled “Background and the Transaction – Board
Considerations,” please supplementally advise the Staff
whether there are any “interested trustees” within the meaning
of Section 2(a)(19) of the Investment Company Act of 1940, as
amended (the “1940 Act”) and if so, whether the percentage of
such interested trustees meets requirements of Section 15(f)
of the 1940 Act.
Response 12
Of the current ten Van Kampen Trustees for the Funds, one
trustee is an “interested” person within the meaning of
Section 2(a)(19) of the 1940 Act. As disclosed in the section
of the proxy statement entitled “Background and the
Transaction – Board Considerations,” it is anticipated that,
upon the later of the closing of the Transaction or
shareholder approval of a Fund’s new investment advisory
agreements, the Van Kampen Board of Trustees would expand to
include one additional trustee representing Invesco senior
management, who would also be an “interested” person within
the meaning of Section 2(a)(19) of the 1940 Act. The Funds
believe that having two out of eleven trustees who are
“interested” persons meets the requirement of Section 15(f)
that, during the three-year period immediately following
consummation of the Transaction, at least 75% of the funds’
board of trustees not be “interested” persons of the
investment adviser or the predecessor adviser.
Comment 13
With respect to the section of the proxy statement entitled
“Proposal 1: Approval of Investment Advisory Agreement
(Including a Master Sub-Advisory Agreement),” please
supplementally explain under what authority the Funds are
proceeding without obtaining separate shareholder approval of
each of the Master Sub-Advisory Agreement and the new
investment advisory agreements.
Response 13
The Funds respectfully believe that the proposal to approve
the Master Sub-Advisory Agreement is inextricably intertwined
with the approval of the new investment advisory agreement.
However, the Funds acknowledge the Staff’s comment and have
changed the heading “Proposal 1: Approval of Investment
Advisory Agreement (Including a Master Sub-Advisory Agreement”
to “Proposal 1(a): Approval of Investment Advisory Agreement
and Proposal 1(b): Approval of a Master Sub-Advisory
Agreement.” The Funds have also revised disclosure throughout
the proxy statement and on the proxy card so that shareholders
will have to vote on each agreement separately.
Comment 14
With respect to the section of the proxy statement entitled
“Proposal 1: Approval of Investment Advisory Agreement
(Including a Master Sub-Advisory Agreement),” please delete
disclosure that states that shareholder approval of the new
investment advisory agreement constitutes approval of the
Master Sub-Advisory Agreement.
4
Response 14
The Funds have deleted the disclosure as requested.
Comment 15
In the section entitled “Proposal 1: Approval of Investment
Advisory Agreement (Including a Master Sub-Advisory Agreement)
– Current Advisory Agreements – Terms of the Current Advisory
Agreements – Fees,” please list the specific investment
advisory fees for each Fund.
Response 15
The Funds have added the list of investment advisory fees of
each Fund to the section referenced as requested.
Comment 16
With respect to the disclosure in the fourth paragraph in the
section entitled “Proposal 1: Approval of Investment Advisory
Agreement (Including a Master Sub-Advisory Agreement) – New
Advisory Agreements – Delegation to subadvisers,” please
supplementally advise the Staff how the Funds intend to
provide notice to shareholders of any changes to investment
subadvisers and/or portfolio managers.
Comment 16
In the event that a new investment subadviser and/or a new
portfolio manager were added to the management of a Fund, the
affected Fund intends to issue a press release announcing such
change, which is consistent with the Funds’ current practice.
In addition, the Funds would expect to include such disclosure
in a Fund’s next issued annual or semi-annual report.
Comment 17
Please add disclosure regarding any change in operations or
shareholder rights as a result of the change in state law
governing the Funds’ investment advisory agreement.
Response 17
The Funds do not believe that there are any changes that would
materially affect a shareholder as a result of the change in
state law governing a Fund’s investment
advisory agreement. The Funds believe that the current disclosure describes the
material differences between the terms of the new investment advisory agreements and
the terms of the current investment advisory agreements and thus, the Funds have not
added additional disclosure.
Response 18
In the following sentence in the section
entitled “Proposal 1:
Approval of Investment Advisory Agreement (Including a Master
Sub-Advisory Agreement) – New Advisory Agreements – Terms of
the Master Sub-Advisory Agreement,” please describe whether
the underlined word “monthly” denotes that the fee will be
determined at the end of each month: “The Sub-Advisory
Agreement for each Fund provides that, to the extent an
Affiliated Sub-Adviser manages a portion of a Fund’s
investments, the fee that Invesco Advisers will pay such
Affiliated Sub-Adviser, computed daily and paid monthly, will
equal (i) 40% of the monthly compensation that Invesco
Advisers receives from the applicable Fund pursuant to its
advisory agreement with such Fund, multiplied by (ii) a
fraction equal to the net assets of such Fund as to which the
Affiliated Sub-Adviser shall have provided
5
discretionary
investment management services for that month divided by the
net assets of such Fund for that month.”
Response 18
The Funds respectfully acknowledge your comment however, the
Funds note that the disclosure referenced currently states
that such fee will be computed daily and paid monthly. Thus,
the Funds do not believe that additional disclosure is
necessary.
Comment 19
Please include on the proxy card a means by which shareholders
may abstain from voting on each proposal.
Response 19
The Funds have revised the proxy card as requested.
* * *
In connection with the effectiveness of the definitive proxy statement, the Funds acknowledge
that the disclosure included in the definitive proxy statement is the responsibility of the Funds.
The Funds further acknowledge that the action of the Commission or the staff acting pursuant to
delegated authority in reviewing the preliminary proxy statement does not relieve the Funds from
their full responsibility for the adequacy and accuracy of the disclosures in the definitive proxy
statement; and that the Funds will not assert this action as a defense in any proceeding initiated
by the Commission or any person under the federal securities laws of the United States.
Should you have any questions concerning our responses to your comments, please direct them to
Stefanie Chang Yu at (212) 296-6970 the undersigned at (312) 407-0863.
Sincerely,
/s/ Charles B. Taylor
6