Date Shares Price Per Share
12/15/2014 (5,104) $19.60
12/16/2014 (800) $19.45
12/17/2014 (8,417) $19.52
12/18/2014 (17,783) $19.56
12/19/2014 (2,980) $19.50
12/22/2014 (2,437) $19.18
12/23/2014 (6,676) $19.24
12/24/2014 (2,147) $19.25
12/29/2014 (25) $19.23
12/30/2014 (500) $19.12
1/5/2015 (5,200) $19.21
1/6/2015 (1,338) $19.28
1/7/2015 (185) $19.32
1/8/2015 (511) $19.41
1/9/2015 (6,566) $19.46
1/22/2015 (400) $19.86
1/23/2015 (700) $19.91
1/26/2015 (3,618) $19.84
1/27/2015 (2,100) $19.91
1/28/2015 (1,800) $19.81
1/29/2015 (450) $19.78
2/2/2015 (6,098) $19.81
2/9/2015 300 $19.58
2/9/2015 (1,418) $19.61
2/10/2015 (1,120) $19.57
2/12/2015 (2,410) $19.52
The Accounts have the right to receive all dividends from, and any proceeds from the sale of the Shares. None of the Accounts has an interest in Shares constituting more than 5% of the Shares outstanding.
Item 6. Contracts, Arrangements, Understandings, or Relationships with Respect to Securities of the Issuer.
Except as described above, there are no contracts, arrangements, understandings or relationships of any kind among the Principals and KIM and between any of them and any other person with respect to any of the Cutwater Select Income Fund securities.
Item 7. Materials to be Filed as Exhibits.
As is indicated in Item 4, above, KIM has purchased shares of the Cutwater Select Income Fund for the Accounts for investment purposes. However, KIM has reserved the right to contact management with regard to concerns that they have with respect to the Fund, including letters to the Board and/or other communications. Accordingly, KIM sent a letter to the SEC on October 31, 2014 regarding concerns it has with the Fund's preliminary proxy statement. A copy of the letter is attached as Exhibit 1.
SIGNATURE
After reasonable inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete, and correct.
Karpus Management, Inc.
By: /s/
Name: Daniel Lippincott
Title: Senior Tax-Sensitive Manager
Date: February 20, 2015
EXHIBIT 1
Letter to the U.S. Securities and Exchange Commission
Transmitted October 31, 2014
VIA ELECTRONIC MAIL (IMOCC@SEC.GOV) October 31, 2014
AND FEDERAL EXPRESS
U.S. Securites and Exchange Commission
Division of Investment Management
100 F Street, NE
Washington, DC 20549
Re: Comments on the Preliminary Proxy Statement for the Cutwater Select Income Fund
Dear Sir or Madam,
The Cutwater Select Income Fund ("CSI" or the "Fund") filed a preliminary proxy statement on October 30, 2014 with the Commission. Karpus Management, Inc., d/b/a Karpus Investment Management ("Karpus") represents beneficial ownership of 919,887 shares, or 8.59% of the outstanding common shares of the Fund. We write this letter to submit disclosure concerns we believe should be addressed prior to the Fund mailing its definitive proxy statement to shareholders. Our concerns are as follows:
1. On Page 3, the Fund briefly discusses "benefits" to Fund shareholders if they approve the proposed transaction. There is virtually no substance to this discussion. The primary note that the Fund provides is that: "It is expected that the collaboration between the Adviser and Insight [a European fixed income investment manager on BNY Mellon's Platform] will provide the Adviser with increased technological and analytical resources in the global fixed income markets, particularly the fixed income markets of emerging countries." [emphasis added]
While this "collaboration" with Insight may provide assistance, the simple fact of the matter is that the Fund's benchmark is the Barclays U.S. Credit Index, which is comprised primarily of U.S. investment grade corporate bonds. Is the Fund planning on deviating widely from its benchmark? Fund shareholders deserve a more comprehensive (as opposed to cursory) discussion of how they will benefit from the proposed change in control. Contrary to what the Fund may think, shareholders' votes on approving the new agreement are more than a formality.
2. Along these same lines, we find no discussion or disclosure indicating how MBIA or any of the Cutwater officers listed on page 8 of the preliminary proxy will benefit financially if the transaction is consummated and Cutwater becomes a subsidiary of BNY Mellon. Presumably, each of these individuals is incentivized if the transaction occurs. However, none of this information is included in the preliminary proxy statement for the Fund.
3. Again, on page 3, at the bottom, a specific portion of the voting threshold is bolded. We assume that this is a typographical error. With the approval threshold being 2/3rds of a quorum or 50% of the outstanding shares, only bolding a portion of that requirement may be misleading.
4. The Fund filed an 8-K with the Commission on October 24, 2014 announcing the resignation of Mr. Gautam Khanna from the Board of Trustees of the Fund. Circumstances surrounding his resignation are not addressed in the proxy statement. With the Fund noting on page 10 that "no material changes in personnel or operations were contemplated," Mr. Khanna's resignation is a substantial change that contradicts that assertion. It also adds further uncertainty because we are unaware of any replacement Trustee and, further, such replacement will not have been duly elected by the shareholders he or she purportedly represents.
5. The proxy statement goes into considerable discussion of whether the proposed change in control will change management and the fees management charges to the Fund. However, we can find no indication that the Board has actually considered managers other than Cutwater to manage the Fund. We believe that if the Board is considering all factors, it should also be considering whether another manager could provide better services with perhaps more attractive fees. With the last shareholder approved agreement being in September 2005, such an analysis and discussion would appear appropriate given the apparent lack of benefit to shareholders for approving the change in control transaction.
Should you wish to discuss any of these comments further, please do not hesitate to contact me at (585) 586-4680. Thank you for your time and consideration.
Sincerely,
/s/
Brett D. Gardner
Senior Corporate Governance Analyst
cc: Leonard Chubinsky, Secretary (via electronic mail and overnight mail)