-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, Jm+ZWftewvR2k3PSBkchbjqXureIowL0Imd3gCOtw374JT+cg9HwTGJozGaHxOZx YFsxjEmnYDMEFH0t4KQHjw== 0001099343-07-000005.txt : 20070209 0001099343-07-000005.hdr.sgml : 20070209 20070208183748 ACCESSION NUMBER: 0001099343-07-000005 CONFORMED SUBMISSION TYPE: SC TO-T/A PUBLIC DOCUMENT COUNT: 6 FILED AS OF DATE: 20070209 DATE AS OF CHANGE: 20070208 SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: PUTNAM CALIFORNIA INVESTMENT GRADE MUNICIPAL TRUST CENTRAL INDEX KEY: 0000892980 IRS NUMBER: 046716831 STATE OF INCORPORATION: MA FISCAL YEAR END: 1031 FILING VALUES: FORM TYPE: SC TO-T/A SEC ACT: 1934 Act SEC FILE NUMBER: 005-82362 FILM NUMBER: 07594047 BUSINESS ADDRESS: STREET 1: ONE POST OFFICE SQUARE STREET 2: MAILSTOP A 14 CITY: BOSTON STATE: MA ZIP: 02109 BUSINESS PHONE: 6172921000 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: Mildred B. Horejsi Trust CENTRAL INDEX KEY: 0001365133 IRS NUMBER: 136196158 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC TO-T/A BUSINESS ADDRESS: STREET 1: 3301 C STREET, SUITE 100 CITY: ANCHORAGE STATE: AK ZIP: 99503 BUSINESS PHONE: (303) 442-2156 MAIL ADDRESS: STREET 1: 3301 C STREET, SUITE 100 CITY: ANCHORAGE STATE: AK ZIP: 99503 SC TO-T/A 1 sctoamend2.txt SCHEDULE TO AMENDMENT NO. 2 SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 SCHEDULE TO (Rule 14d-100) Tender Offer Statement Pursuant to Section 14(d)(1) or 13(e)(1) of the Securities Exchange Act of 1934 PUTNAM CALIFORNIA INVESTMENT GRADE MUNICIPAL TRUST (Name of Subject Company (Issuer)) MILDRED B. HOREJSI TRUST (Name of Filing Persons (Offerors)) COMMON STOCK, PAR VALUE $0.001 PER SHARE (Title of Class of Securities) 746446103 (CUSIP Number of Class of Securities) Stephen C. Miller, Esq. Joel L. Terwilliger, Esq. 2344 Spruce Street, Suite A Boulder, Colorado 80302 (303) 442-2156 Copy to: Thomas Stephens, Esq. Bartlit Beck Herman Palenchar & Scott LLP 1899 Wynkoop Street, Suite 800 Denver, CO 80202 (303) 592-3144 (Name, Address and Telephone Numbers of Person Authorized to Receive Notices and Communications on Behalf of Filing Persons) Calculation of Filing Fee Transaction Valuation* Amount of Filing Fee** $63,985,486 $6,847.00 - ------------------------ * Estimated for purposes of calculating the amount of filing fee only. Transaction value derived by multiplying 4,509,649 shares of the subject company (number of shares sought) by $14.16 (the purchase price per share offered by the Mildred B. Horejsi Trust). ** The amount of the filing fee, calculated in accordance with Rule 0-11 under the Securities Exchange Act of 1934, as amended, equals $107 per million of the aggregate amount of the cash offered by the Mildred B Horejsi Trust. |X| Check the box if any part of the fee is offset as provided by Rule 0-11(a)(2) and identify the filing with which the offsetting fee was previously paid. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing. Amount Previously Paid: $6,847.00 Filing Party: MILDRED B. HOREJSI TRUST Form or Registration Number: Schedule TO-T Date Filed: January 22, 2007 |_| Check the box if the filing relates solely to preliminary communications made before the commencement of a tender offer. Check the appropriate boxes below to designate any transactions to which the statement relates: |X| third-party tender offer subject to Rule 14d-1. |_| issuer tender offer subject to Rule 13e-4. |_| going private transaction subject to Rule 13e-3. |_| amendment to Schedule 13D under Rule 13d-2. Check the following box if the filing is a final amendment reporting the results of the tender offer: |_| AMENDMENT NO. 2 TO SCHEDULE TO This Amendment No. 2 to the Tender Offer Statement on Schedule TO is being filed by the Mildred B. Horejsi Trust, an irrevocable grantor trust administered in accordance with Alaska administrative statutes and governed by Alaska trust law (the "Trust"), and amends and supplements the Tender Offer Statement initially filed with the Securities and Exchange Commission ("SEC") on January 22, 2007 (the "Original Schedule TO"), as amended January 30, 2007. This Schedule TO relates to the offer by the Trust to purchase up to 100% of the outstanding shares of common stock, par value $0.001 per share (the "shares"), of Putnam California Investment Grade Municipal Trust, a Massachusetts business trust ("PCA"), at a price of $14.16 per share, net to the seller in cash (subject to applicable withholding of United States federal, state and local taxes), without interest. The offer is set forth in the Offer to Purchase dated January 22, 2007, as amended, (the "Offer to Purchase") and in the related letter of transmittal, as amended (which, together with the Offer to Purchase, and any amendments or supplements hereto or thereto, collectively constitute the "Offer"). Copies of the Offer to Purchase and the letter of transmittal were attached as Exhibits (a)(1) and (a)(2), respectively, to the Original Schedule TO. A Supplement to the Offer to Purchase is attached to this Schedule TO as Exhibit (a)(16). The Original Schedule TO, as amended, is hereby supplemented and amended as follows: Item 12. Exhibits. The following Exhibits are added: Exhibit Description (a)(14) Form of Communication Letter to Shareholders dated February 8, 2007 (a)(15) Form of Communication Letter to Shareholders from the Mildred B. Horejsi Trust dated February 8, 2007 (a)(16) Supplement to the Offer to Purchase dated February 8, 2007 (a)(17) Form of Letter to Broker-Dealers, as amended, and dated February 8, 2007 (a)(18) Form of Letter to Broker-Dealer Clients, as amended, and dated February 8, 2007 SIGNATURE After due 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. MILDRED B. HOREJSI TRUST By: Badlands Trust Company, LLC, trustee By: /s/ Stephen C. Miller Name: Stephen C. Miller Title: President Dated: February 8, 2007 EXHIBIT INDEX (a) (1) Offer to Purchase, dated January 22, 2007* (2) Letter of Transmittal.* (3) Notice of Guaranteed Delivery.* (4) Letter to Brokers, Dealers, Commercial Banks, Trust Companies and Other Nominees.* (5) Letter to Clients for Use by Brokers, Dealers, Commercial Banks, Trust Companies and Other Nominees.* (6) Guidelines for Certification of Taxpayer Identification Number on Substitute Form W-9* (7) Summary Advertisement, as published in the western edition of the Wall Street Journal on January 22, 2007.* (8) Form of press release issued January 22, 2007* (9) Form of Request for Stockholder List as provided to the Trustees of PCA and dated January 22, 2007* (10) Form of Request for Stockholder List Pursuant to Rule 14d-5(a) under the Exchange Act of 1934* (11) Form of Shareholder Communications Insert* (12) Form of Cover Letter Provided to Shareholders* (13) Form of Communication Letter to Shareholders dated January 29, 2007** (14) Form of Communication Letter to Shareholders dated February 8, 2007 (15) Form of Communication Letter to Shareholders from the Mildred B. Horejsi Trust dated February 8, 2007 (16) Supplement to the Offer to Purchase dated February 8, 2007 (17) Form of Letter to Broker-Dealers, as amended, and dated February 8, 2007 (18) Form of Letter to Broker-Dealer Clients, as amended, and dated February 8, 2007 (b) (1) Cash Management Account Agreement between the Trust and Merrill Lynch, Pierce, Fenner & Smith Incorporated.* (b) (2) Revolving Line of Credit Between the Trust and the Lola Brown Trust No. 1B* (d) Not Applicable (g) Not Applicable (h) Not Applicable * Previously filed with the SEC on January 22, 2007 (accession number: 0001099343-07-000002). ** Previously filed with the SEC on January 30, 2007 (accession number: 0001099343-07-000003). EX-99.A14 2 exa14tickler.txt TICKLER LETTER TO SHAREHOLDERS Exhibit (a) (14) THIS CONCERNS YOUR EXISTING INVESTMENT IN PUTNAM CALIFORNIA INVESTMENT GRADE MUNICIPAL TRUST (AMEX TICKER: PCA) THE INVESTMENT YOU MADE IN PCA MAY CHANGE DRAMATICALLY!! BY NOW, YOU SHOULD HAVE RECEIVED A PACKAGE OF INFORMATION CONCERNING OUR TENDER OFFER TO PURCHASE ALL OF THE SHARES OF PCA. YOU SHOULD CONSIDER OUR OFFER IMMEDIATELY. THESE ARE THE KEY REASONS WE BELIEVE YOU SHOULD ACT ON OUR OFFER: 1. PCA'S TRUSTEES PROPOSE TO "OPEN-END" AND MERGE YOUR SHARES OF PCA INTO PUTNAM CALIFORNIA TAX EXEMPT INCOME FUND. THIS WILL RESULT IN YOUR ASSETS BEING PLACED IN A FUND WHICH PERFORMED WORSE THAN ITS APPLICABLE BENCHMARK INDEX FOR 6 OUT OF THE PAST 7 CALENDAR YEARS AND UNDERPERFORMED PCA FOR 5 OF THE LAST 7 YEARS! A PROPOSAL TO MERGE OUR SHARES INTO A WORSE-PERFORMING FUND IS NOT IN OUR BEST INTEREST. 2. IF WE ARE SUCCESSFUL IN ACQUIRING A MAJORITY OF PCA'S COMMON SHARES, WE WILL PROPOSE CHANGES INCLUDING REPLACING THE CURRENT INVESTMENT ADVISER AND CHANGING PCA'S INVESTMENT OBJECTIVES, AS WELL AS OTHER CHANGES THAT WILL RESULT IN PCA BEING FAR DIFFERENT THAN THE INVESTMENT YOU BOUGHT. 3. IF SHAREHOLDERS APPROVE THESE CHANGES, PCA WILL NO LONGER BE AN INCOME FUND. IT WILL LIQUIDATE ITS ENTIRE PORTFOLIO OF CALIFORNIA MUNICIPAL BONDS AND ANY INCOME WILL NO LONGER BE EXEMPT FROM FEDERAL AND CALIFORNIA INCOME TAX. IF YOU DON'T WANT TO BE PART OF THIS NEW DIRECTION, OUR TENDER OFFER GIVES YOU AN OPPORTUNITY TO SELL YOUR SHARES AT A FAIR PRICE. ACT NOW WHILE YOU HAVE THE OPPORTUNITY THE OFFER EXPIRES ON FEBRUARY 16, 2007 If you have not received your materials or if you need further information, you may contact our Information Agent: Morrow & Co., Inc. (800) 607-0088 The Mildred Horejsi Trust February 8, 2007 EX-99.A15 3 exa15coverlettersh.txt LETTER TO SHAREHOLDERS Exhibit (a)(15) MILDRED B. HOREJSI TRUST C/O BADLANDS TRUST COMPANY, LLC 3301 C STREET, ANCHORAGE, AK 99501 Dear fellow shareholders: By now you have received a package of documents from the Mildred B. Horejsi Trust in which we are offering to purchase all of your shares of the Putnam California Investment Grade Municipal Trust ("PCA") at a cash price of $14.16 per share. We urge you to tender your shares in our offer and to read the offering documents before making your decision. You may have also received materials from PCA's trustees making recommendations regarding our offer. The trustees want you to hold your shares so that PCA can be merged into a Putnam open-end fund, which they think would mean you might earn an additional 4.4% if the merger is successful. If this happens, your assets would continue to be managed by Putnam. The trustees do not offer a coherent explanation for their flip-flop from just a few months ago when they advised shareholders that "the continued operation of the fund as [a] closed-end fund is in the best long-term interests of the fund's shareholders." You should ask yourself what's to keep the trustees from flip-flopping again on this issue and abandoning the promised merger. Can you really trust people who flip-flop when it's in their best interest and convenient to do so? The trustees stated that the "benefits [of PCA remaining a closed-end fund] include the ability to maintain a stable pool of assets and remain more fully invested in longer-term, higher-yielding securities than would be possible if the fund were open-end[ed.]" How could this have been true a few months ago and not true today? The trustees fail to mention that a merger with an open-end counterpart will end PCA's use of leverage. PCA's most recent semi-annual report says that PCA "uses leverage -- that is, it invests with funds raised by issuing preferred shares -- in an effort to take greater advantage of investment opportunities". Open-end funds cannot use leverage, and thus PCA shareholders will lose the benefits of leverage once the merger occurs. We believe that leverage is an important asset. Shareholders pay a substantial cost for issuing leverage and it should not be wasted. Merging into an open-end fund necessarily means throwing away this substantial sunk cost. Finally, as discussed below, we believe that keeping your assets with Putnam does not make long-term economic sense for you. Here are the reasons why we believe you should tender your shares: 1. Our offer is no longer subject to any minimum number of shares being tendered(1). 2. You will realize cash on your shares now, and not wait several months(2) crossing your fingers that the merger happens. There are two risks in waiting for the merger: First, the risk that the trustees don't follow through with their promise to merge (or the merger is voted down by shareholders) and, second, the risk that, after the merger happens or does not happen, the per-share NAV will be less than our offer price. Do you really want to take these risks? If you tender your shares with us, you can walk away with cash and avoid these risks. 3. The trustees are asking you to risk your investment so they can merge your shares with those of another Putnam fund managed by the same investment adviser that manages PCA. Given PCA's abysmal results and peer group rankings by Morningstar, we believe the trustees' recommendation runs contrary to your long-term best interests and clearly indicates that the trustees are more concerned with Putnam retaining management of your assets than maximizing your share value. This is underscored by the fact that the independent trustees own only a handful of shares of PCA. Filings with the SEC show that the independent trustees own an average of less than 140 shares each. This says a lot about what the independent trustees think about the manager, Putnam Management, and the future of PCA. 4. PCA's 1-year return on NAV as of 12/31/06 was 6.03%, outperforming its benchmark(3) by 1.19%. The trustees want to merge your shares of PCA into the open-end Putnam California Tax Exempt Income Fund. This fund performed worse than the same benchmark for 6 out of the past 7 calendar years and underperformed PCA for 5 of the last 7 years. In contrast, the closed-end funds controlled and managed by the Horejsi family(4) outperformed their respective indices for 6 out of the past 7 years (BTF) and 3 out of the past 4 years (BIF)(5). BIF's 1-year return on NAV was 26.4% for the period ending 12/31/06, beating the S&P 500 index by 10.6% for the same period. BTF's 1-year return on NAV was 19.9%, beating the S&P 500 Index by 4.1% for the same period. Of course, past performance is no guarantee of future results, and we caution you that BIF and BTF have had substantially different investment objectives than PCA and the Putnam open-end fund and, consequently, investment returns are not directly comparable. Although no one can predict with any certainty whether investments will appreciate or decline in value going forward, PCA's trustees think that you are better served by owning shares in a fund which has fared even more poorly than PCA! We are offering you approximately 96% of the net asset value of your shares now or a chance at a new direction in fund management. 5. As discussed above, the trustees have already considered and rejected a proposal very similar to their latest recommendation. Their flip-flop adoption of a proposal they said was a bad idea just several months ago should raise questions; we believe our offer makes more sense for you. 6. Under PCA's declaration of trust and under the Federal laws governing PCA, it is apt to be very difficult and time-consuming to merge PCA into an open-end fund. We believe the trustees' proposal to merge PCA will fail for lack of shareholder support and thus the 4.4% gain down the road the trustees talk about may be illusory. The Trust will not vote in favor of the proposed merger. The true purpose of the trustees, we believe, is to keep your money under their management. We think the trustees' proposal is solely a response to our tender offer. If our tender offer fails, we think, based on the trustees' recent flip-flopping, there is a very real risk that they will drop the merger proposal or allow it to fail, and as a result PCA's market price and discount will sink back to the level prior to our tender. 7. The trustees recommend that PCA be kept under Putnam's management. Putnam has been accused of excessive short-term trading and will pay a total of at least $193.5 million in penalties and restitution for these open-end fund abuses. As recently as January 9, 2007, Putnam was forced to agree to a settlement on charges of breach of fiduciary duty to you. Do you really want the people with this track record looking after your money? 8. In the three year period through October 2006, Putnam's U.S. stock funds returned less than those of 18 of the 20 largest fund firms, according to a ranking by Russel Kinnel, a Morningstar analyst. Putnam's investors have redeemed more than $159 billion during that period. The shareholders in those open-end funds had a chance to escape. Again, we are giving shareholders the opportunity to get out of PCA now at a fair price relative to the fund's NAV. As of November 2006, Putnam dropped from the fourth-largest mutual fund company to the 21st by assets among fund managers, according to the Investment Company Institute. According to their own documents, they anticipate additional withdrawals in 2007 of $900 million. We believe our offer gives you an opportunity to redeem your shares at a fair price close to NAV and move PCA in a new direction. We believe that shareholders of PCA deserve a fresh start. We are making our offer because we intend to acquire control of PCA so that we may take PCA in a new direction with investment advisers solely dedicated to the management of closed-end funds. One of the changes we will propose to implement if we acquire control of PCA is to change PCA's investment policies to permit PCA to invest in securities other than California municipal bonds. THIS CHANGE IS LIKELY TO RESULT IN NONE OF PCA'S DIVIDENDS BEING EXEMPT FROM EITHER FEDERAL OR CALIFORNIA INCOME TAXES. We urge you to tender your shares in our offer and to read the offering documents before making your decision. If you need documents or further information, you may contact Morrow & Co., Inc., our information agent, at (800) 607-0088 (banks and brokers should call (203) 658-9400). Mildred B. Horejsi Trust February 8, 2007 FOOTNOTES: (1) Our original offer contained the condition that "if the number of shares tendered is less than 25% of the outstanding shares, we may determine, based on our sole discretion, that the number of shares tendered as a result of this Offer are insufficient for us to meet our goals as set forth herein[.]" We have removed this condition and thus our offer is not subject to any minimum number of shares being tendered. (2) In a recent press release, PCA indicated that the merger would be completed in June 2007. (3) The Lehman Municipal Bond Index. (4) Boulder Growth & Income Fund, Inc. (NYSE:BIF) and Boulder Total Return Fund, Inc. (NYSE:BTF). (5) The Horejsi family trusts gained control of BIF in 2002. EX-99.A16 4 exa16offertopurch.txt OFFER TO PURCHASE Exhibit (a)(16) - -------------------------------------------------------------------------------- Supplement Dated February 8, 2007 Relating to the Offer to Purchase Dated January 22, 2007 as amended January 30, 2007 - -------------------------------------------------------------------------------- MILDRED B. HOREJSI TRUST Has Amended Its Offer to Purchase for Cash All of the Outstanding Shares of Common Stock of PUTNAM CALIFORNIA INVESTMENT GRADE MUNICIPAL TRUST at $14.16 Net Per Share THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT, NEW YORK CITY TIME, ON FEBRUARY 16, 2007, UNLESS THE OFFER IS FURTHER EXTENDED. THE OFFER IS NOT CONDITIONED UPON THE RECEIPT OF FINANCING OR UPON ANY MINIMUM NUMBER OF SHARES BEING TENDERED. THE OFFER IS SUBJECT TO CERTAIN CONDITIONS, INCLUDING THE CONDITION THAT TENDERING HOLDERS HOLDING SHARES ON FEBRURARY 15, 2006 MUST PROVIDE A PROXY TO VOTE THE SHARES. SEE "CONDITIONS TO THE OFFER -- SECTION 14." NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED OF THIS TRANSACTION OR PASSED UPON THE MERITS OR FAIRNESS OF THIS TRANSACTION OR PASSED UPON THE ADEQUACY OR ACCURACY OF THE INFORMATION CONTAINED IN THE OFFER OR THIS SUPPLEMENT. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. IMPORTANT Any shareholder desiring to tender all or any portion of the shareholder's shares should either: |X| Request the shareholder's broker, dealer, commercial bank, trust company or other nominee to effect the transaction for the shareholder. A shareholder whose shares are registered in the name of a broker, dealer, commercial bank, trust company or other nominee must contact such broker, dealer, commercial bank, trust company or other nominee if the shareholder desires to tender such shares; or |X| Complete and sign the letter of transmittal (or a facsimile thereof) in accordance with the instructions in the letter of transmittal, have the shareholder's signature guaranteed if required by Instruction 1 to the letter of transmittal, mail or deliver the letter of transmittal (or such facsimile), or, in the case of a transfer effected pursuant to the book-entry transfer procedures set forth in "THE OFFER -- Section 7," transmit an "agent's message" (as defined in "THE OFFER -- Section 6"), and any other required documents to the depositary and either deliver the certificates for such shares to the depositary along with the letter of transmittal (or such facsimile) or deliver the shares pursuant to the book-entry transfer procedures set forth in "THE OFFER -- Section 7." If a shareholder desires to tender shares and the share certificates are not immediately available, or the procedure for book-entry transfer cannot be completed on a timely basis, or time will not permit all required documents to reach the depositary prior to the "expiration date" (as defined herein), then the tender may be effected by following the procedure for guaranteed delivery set forth in "THE OFFER -- Section 7." Questions and requests for assistance may be directed to Morrow & Co., Inc., which is acting as the information agent for our offer, at (203) 658-9400 (for Brokers or Bankers) or (800) 607-0088 (toll-free for shareholders). Additional copies of this offering document, the letter of transmittal, the notice of guaranteed delivery and other related materials may be obtained from the information agent. The Information Agent for the Offer is: Morrow & Co., Inc. 470 West Avenue Stamford, CT 06902 Banks and Brokers Call (203) 658-9400 Shareholders Call Toll Free: (800) 607-0088 The following information amends and supplements the Offer to Purchase dated January 22, 2007 and filed as exhibit (a)(1) to the Schedule TO filed by the Mildred B. Horejsi Trust, an irrevocable grantor trust administered in accordance with Alaska administrative statutes and governed by Alaska trust law (the "Trust"). It amends and supplements the Tender Offer initially filed with the Securities and Exchange Commission ("SEC") on January 22, 2007 (the "Original Schedule TO"), as amended January 30, 2007 pursuant to which Trust is offering to purchase up to 100% of the outstanding shares of common stock, par value $0.001 per share (the "shares"), of Putnam California Investment Grade Municipal Trust, a Massachusetts business trust ("PCA"), at a price of $14.16 per share, net to the seller in cash (subject to applicable withholding of United States federal, state and local taxes), without interest. Except as otherwise set forth in this Supplement, the terms and conditions set forth in the Offer to Purchase and the letter of transmittal are applicable in all respects to the Offer. The information set forth below should be read in conjunction with the Original Schedule TO and the letter of transmittal and terms not defined herein have the meanings ascribed to them in the Original Schedule TO. QUESTIONS AND ANSWERS How have you amended the Offer? We are amending our Offer as follows: 1. We are providing you with additional information regarding PCA's Schedule 14D-9 filing and related documents in which the trustees of PCA have offered their recommendation statement regarding the Offer. 2. We have removed one of our conditions to the Offer as discussed in detail below. 3. We have conditioned the Offer requiring that shares tendered and accepted for payment from tendering holders who held the shares on February 15, 2007 must be accompanied by a valid irrevocable proxy to vote such shares, as discussed in more detail below. We have not changed the number of shares we are offering to purchase, the offer price, and the procedures for tendering and withdrawing shares or any of the other terms of our Offer. What condition to the Offer have you changed? In the Original Schedule TO, the "Conditions to the Offer" section states in #7 that "if the number of shares tendered is less than 25% of the outstanding shares, we may determine, based on our sole discretion, that the number of shares tendered as a result of this Offer are insufficient for us to meet our goals as set forth herein[.]" We are removing this condition #7 to the Offer; all other conditions to the Offer remain unchanged. Our Offer is not subject to any minimum number of shares being tendered. What condition have you added? We have reason to believe that PCA has set February 15, 2007 (the "Record Date") as the record date for a special meeting of shareholders to approve the terms and conditions of a merger. Because we intend to vote all of our shares at this meeting, we have added a condition to the offer requiring that shares tendered and accepted for payment from tendering holders who held the shares on the Record Date must be accompanied by a valid irrevocable proxy to vote such shares. What additional information are you providing in response to PCA's Schedule 14D-9 filing? You should have received, or will receive soon, materials from the trustees of PCA concerning our Offer and their recommendations about the Offer. In principal, the trustees have stated that they believe you should not tender your shares to us so that you can potentially earn an additional 4.4% and so that you can continue to keep your assets under management with Putnam, This is contrary to the trustees' earlier communications to you in which they stated that they "believe that the continued operation of the fund as [a] closed-end fund is in the best long-term interests of the fund's shareholders." Further, the trustees have stated that the "benefits [of PCA remaining a closed-end fund] include the ability to maintain a stable pool of assets and remain more fully invested in longer-term, higher-yielding securities than would be possible if the fund were open-end[ed.]" Finally, as discussed below, we believe keeping your assets with Putnam does not make long-term sense for you. Here are the reasons why we believe you should tender your shares: 1. Our offer is no longer subject to any minimum number of shares being tendered.(1) 2. You will realize cash on your shares now, and not wait several months(2) crossing your fingers that the merger happens. There are two risks in waiting for the merger: First, the risk that the trustees don't follow through with their promise to merge (or the merger is voted down by shareholders) and, second, the risk that, after the merger happens or does not happen, the per-share NAV will be less than our offer price. Do you really want to take these risks? If you tender your shares with us, you can walk away with cash and avoid these risks. 3. The trustees are asking you to risk your investment so they can merge your shares with those of another Putnam fund managed by the same investment adviser that manages PCA. Given PCA's abysmal results and peer group rankings by Morningstar, we believe the trustees' recommendation runs contrary to your long-term best interests and clearly indicates that the trustees are more concerned with Putnam retaining management of your assets than maximizing your share value. This is underscored by the fact that the independent trustees own only a handful of shares of PCA. Filings with the SEC show that the independent trustees own an average of less than 140 shares each. This says a lot about what the independent trustees think about the manager, Putnam Management, and the future of PCA. 4. PCA's 1-year return on NAV as of 12/31/06 was 6.03%, outperforming its benchmark(3) by 1.19%. The trustees want to merge your shares of PCA into the open-end Putnam California Tax Exempt Income Fund. This fund performed worse than the same benchmark for 6 out of the past 7 calendar years and underperformed PCA for 5 of the last 7 years. In contrast, the closed-end funds controlled and managed by the Horejsi family(4) outperformed their respective indices for 6 out of the past 7 years (BTF) and 3 out of the past 4 years (BIF)(5). BIF's 1-year return on NAV was 26.4% for the period ending 12/31/06, beating the S&P 500 index by 10.6% for the same period. BTF's 1-year return on NAV was 19.9%, beating the S&P 500 Index by 4.1% for the same period. Of course, past performance is no guarantee of future results, and we caution you that BIF and BTF have had substantially different investment objectives than PCA and the Putnam open-end fund and, consequently, investment returns are not directly comparable. Although no one can predict with any certainty whether investments will appreciate or decline in value going forward, PCA's trustees think that you are better served by owning shares in a fund which has fared even more poorly than PCA! We are offering you approximately 96% of the net asset value of your shares now or a chance at a new direction in fund management. 5. As discussed above, the trustees have already considered and rejected a proposal very similar to their latest recommendation. Their flip-flop adoption of a proposal they said was a bad idea just several months ago should raise questions; we believe our offer makes more sense for you. 6. Under PCA's declaration of trust and under the Federal laws governing PCA, it is apt to be very difficult and time-consuming to merge PCA into an open-end fund. We believe the trustees' proposal to merge PCA will fail for lack of shareholder support and thus the 4.4% gain down the road the trustees talk about may be illusory. The Trust will not vote in favor of the proposed merger. The true purpose of the trustees, we believe, is to keep your money under their management. We think the trustees' proposal is solely a response to our tender offer. If our tender offer fails, we think, based on the trustees' recent flip-flopping, there is a very real risk that they will drop the merger proposal or allow it to fail, and as a result PCA's market price and discount will sink back to the level prior to our tender. 7. The trustees recommend that PCA be kept under Putnam's management. Putnam has been accused of excessive short-term trading and will pay a total of at least $193.5 million in penalties and restitution for these open-end fund abuses. As recently as January 9, 2007, Putnam was forced to agree to a settlement on charges of breach of fiduciary duty to you. Do you really want the people with this track record looking after your money? 8. In the three year period through October 2006, Putnam's U.S. stock funds returned less than those of 18 of the 20 largest fund firms, according to a ranking by Russel Kinnel, a Morningstar analyst. Putnam's investors have redeemed more than $159 billion during that period. The shareholders in those open-end funds had a chance to escape. Again, we are giving shareholders the opportunity to get out of PCA now at a fair price relative to the fund's NAV. As of November 2006, Putnam dropped from the fourth-largest mutual fund company to the 21st by assets among fund managers, according to the Investment Company Institute. According to their own documents, they anticipate additional withdrawals in 2007 of $900 million. We believe our offer gives you an opportunity to redeem your shares at a fair price close to NAV and move PCA in a new direction. We intend to acquire control of PCA so that we may take PCA in a new direction with investment advisers solely dedicated to the management of closed-end funds. One of the changes we will propose to implement if we acquire control of PCA is to change PCA's investment policies to permit PCA to invest in securities other than California municipal bonds. This change is likely to result in NONE OF PCA's DIVIDENDS being exempt from either federal or California income taxes. If I already tendered my shares in the Offer, do I have to do anything now? No. Shareholders who validly tendered their shares previously and have not withdrawn them do not have to take any further action. If the Offer is completed, these shares will be accepted for payment and the tendering shareholders will receive the offer price of $14.16 per share in cash, without interest, less any required withholding taxes. See "THE OFFER -- Section 5." Can I withdraw my previously tendered shares? You may withdraw all or a portion of your tendered shares at any time prior to the time the shares are accepted for payment, after which they cannot be withdrawn. See "THE OFFER -- Section 8." How do I withdraw previously tendered shares? To withdraw shares, you must deliver a written notice of withdrawal with the required information to the depositary while you still have the right to withdraw the shares. If you have tendered your shares by giving instructions to a bank, broker, dealer, trust company or other nominee, you must instruct them to arrange for the withdrawal of your shares. See "THE OFFER -- Section 8." How many shares have been tendered in response to your Offer? As of the close of business on February 8, 2007, 20,860 shares have been tendered for sale to us in response to our Offer. Who can I contact if I have additional questions about the Offer? If you have questions or you need assistance, you should contact Morrow & Co., Inc., which is acting as the information agent for our Offer, at (203) 658-9400 (for Brokers or Bankers) or (800) 607-0088 (toll-free for shareholders). MISCELLANEOUS The Offer is not being made to, nor will tenders be accepted from or on behalf of, holders of shares in any jurisdiction in which the making of the Offer or the acceptance thereof would not comply with the laws of that jurisdiction. We are not aware of any jurisdiction in which the making of the Offer or the tender of shares in connection therewith would not be in compliance with the laws of such jurisdiction. If we become aware of any state law prohibiting the making of the Offer or the acceptance of shares pursuant thereto in such state, we will make a good faith effort to comply with any such state statute or seek to have such state statute declared inapplicable to the Offer. If, after such good faith effort, we cannot comply with any such state statute, the Offer will not be made to (nor will tenders be accepted from or on behalf of) the holders of shares in such jurisdiction. In any jurisdiction where the securities, blue sky or other laws require the Offer to be made by a licensed broker or dealer, the Offer shall be deemed to be made on behalf of the Trust by one or more registered brokers or dealers which are licensed under the laws of such jurisdiction. No person has been authorized to give any information or to make any representation on our behalf not contained in the Offer and, if given or made, that information or representation must not be relied on as having been authorized. We filed with the SEC a Schedule TO dated January 22, 2007 and an Amendment No. 1 to Schedule TO dated January 30, 2007, under Exchange Act Rule 14d-3, together with exhibits, furnishing additional information with respect to the Offer, and may file additional amendments thereto. That schedule and any amendments thereto, including exhibits, may be examined and copies may be obtained from the offices of the SEC in the same manner as discussed in "THE OFFER -- Section 12" with respect to information concerning PCA. MILDRED B. HOREJST TRUST February 8, 2007 FOOTNOTES: (1) Our original offer contained the condition that "if the number of shares tendered is less than 25% of the outstanding shares, we may determine, based on our sole discretion, that the number of shares tendered as a result of this Offer are insufficient for us to meet our goals as set forth herein[.]" We have removed this condition and thus our offer is not subject to any minimum number of shares being tendered. (2) In a recent press release, PCA indicated that the merger would be completed in June 2007. (3) The Lehman Municipal Bond Index. (4) Boulder Growth & Income Fund, Inc. (NYSE:BIF) and Boulder Total Return Fund, Inc. (NYSE:BTF). (5) The Horejsi family trusts gained control of BIF in 2002. [INTENTIONALLY LEFT BLANK] [INTENTIONALLY LEFT BLANK] Facsimile copies of the letter of transmittal, properly completed and duly executed, will be accepted. The letter of transmittal, certificates for shares and any other required documents should be sent or delivered by each shareholder of PCA or his or her broker, dealer, commercial bank, trust company or other nominee to the depositary at one of its addresses set forth below: The Depositary for the Offer is: The Colbent Corporation By Mail: By Overnight Courier: By Hand: The Colbent Corporation The Colbent Corporation The Colbent Corporation Attn: Corporate Actions Attn: Corporate Actions Attn: Corporate Actions POB 859208 161 Bay State Drive 161 Bay State Drive Braintree MA 02185-9208 Braintree MA 02184 Braintree MA 02184
By Facsimile: (781-380-3388) Confirm Facsimile Transmission: (781-843-1833 Ext. 200) Questions and requests for assistance may be directed to the information agent at its address and telephone numbers listed below. Additional copies of this Supplement, the Offer to Purchase, the letter of transmittal and other tender offer materials may be obtained from the information agent, and will be furnished promptly at our expense. You may also contact your broker, dealer, commercial bank, trust company or other nominee for assistance concerning the Offer. The Information Agent for the Offer is: Morrow & Co., Inc. 470 West Avenue Stamford, CT 06902 Banks and Brokers Call (203) 658-9400 Shareholders Call Toll Free: (800) 607-0088 EX-99.A17 5 exa17brokerletter.txt LETTER TO BROKER-DEALERS Exhibit (a)(17) OFFER TO PURCHASE FOR CASH All Outstanding Shares of Common Stock of PUTNAM CALIFORNIA INVESTMENT GRADE MUNICIPAL TRUST at $14.16 Net Per Share by MILDRED B. HOREJSI TRUST THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT, NEW YORK CITY TIME, ON FEBRUARY 16, 2007, UNLESS THE OFFER IS EXTENDED. February 8, 2007 To Brokers, Dealers, Commercial Banks, Trust Companies and Other Nominees: We have been appointed by the Mildred B. Horejsi Trust, an irrevocable grantor trust administered in accordance with Alaska administrative statutes and governed by Alaska trust law (the "Trust") to act as information agent in connection with the Trust's offer to purchase up to 100% of the outstanding shares of common stock, par value $0.001 per share (the "shares"), of Putnam California Investment Grade Municipal Trust, a Massachusetts business trust ("PCA"), at $14.16 per share, net to the seller in cash (subject to applicable withholding of United States federal, state and local taxes), on the terms and subject to the conditions set forth in the Offer to Purchase dated January 22, 2007 as amended by a Supplement dated February 8, 2007 (collectively, the "Offer to Purchase") and the related letter of transmittal (which, together with any supplements or amendments thereto, collectively constitute the "Offer"). Please furnish copies of the enclosed materials to those of your clients for whom you hold shares registered in your name or in the name of your nominee. Enclosed herewith are copies of the following documents: 1. Supplement to the Offer to Purchase dated February 8, 2007; 2. Letter of transmittal for your use in accepting the Offer and tendering shares and for the information of your clients; 3. A form of letter that may be sent to your clients for whose account you hold shares in your name or in the name of a nominee, with space provided for obtaining such client's instructions with regard to the Offer; 4. Notice of guaranteed delivery with respect to shares; 5. Guidelines for Certification of Taxpayer Identification Number on Substitute Form W-9; and 6. Return envelope addressed to The Colbent Corporation as the depositary. CERTAIN CONDITIONS TO THE OFFER ARE DESCRIBED IN SECTION 14 OF THE OFFER TO PURCHASE AND THE SUPPLEMENT DATED FEBRUARY 8, 2007. ONE OF THESE CONDITIONS REQUIRES THAT SHARES ACCEPTED FOR PURCHASE THAT ARE TENDERED BY SHAREHOLDERS HOLDING SHARES AS OF FEBRUARY 15, 2007 MUST BE ACCOMPANIED BY A VALID IRREVOCABLE LEGAL PROXY TO VOTES SUCH SHARES. WE URGE YOU TO CONTACT YOUR CLIENTS AS PROMPTLY AS POSSIBLE. PLEASE NOTE THAT THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT, NEW YORK CITY TIME, ON FEBRUARY 16, 2007, UNLESS THE OFFER IS EXTENDED. In all cases, payment for shares accepted for payment pursuant to the Offer will be made only after timely receipt by the depositary of (1) the certificates for (or a timely book-entry confirmation (as defined in the Offer to Purchase) with respect to) such shares, (2) a letter of transmittal (or a facsimile thereof), properly completed and duly executed, with any required signature guarantees, or, in the case of a book-entry transfer effected pursuant to the procedures set forth in Section 3 of the Offer to Purchase, an agent's message (as defined in the Offer to Purchase), and (3) any other documents required by the letter of transmittal. Accordingly, tendering stockholders may be paid at different times depending on when certificates for shares or book-entry confirmations with respect to shares are actually received by the depositary. UNDER NO CIRCUMSTANCES WILL INTEREST BE PAID ON THE PURCHASE PRICE OF THE SHARES REGARDLESS OF ANY EXTENSION OF OR AMENDMENT TO THE OFFER OR ANY DELAY IN PAYING FOR SUCH SHARES. The Purchasers will not pay any fees or commissions to any broker or dealer or other person (other than the information agent and the depositary, as described in the Offer to Purchase) in connection with the solicitation of tenders of shares pursuant to the Offer. However, the Purchasers will, on request, reimburse you for customary mailing and handling expenses incurred by you in forwarding copies of the enclosed Offer materials to your clients. Questions and requests for additional copies of the enclosed material may be directed to the information agent at its address and telephone number set forth on the back cover of the Offer to Purchase. Very truly yours, Morrow & Co. Nothing contained herein or in the enclosed documents shall render you or any other person the agent of the Purchasers, the depositary, the information agent or any affiliate of any of them or authorize you or any other person to give any information or use any document or make any statement on behalf of any of them with respect to the Offer other than the enclosed documents and the statements contained therein. EX-99.A18 6 exa18letterclients.txt LETTER TO CLIENTS Exhibit (a)(18) OFFER TO PURCHASE FOR CASH All Outstanding Shares of Common Stock of PUTNAM CALIFORNIA INVESTMENT GRADE MUNICIPAL TRUST at $14.16 Net Per Share by MILDRED B. HOREJSI TRUST THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT, NEW YORK CITY TIME, ON FEBRUARY 16, 2007, UNLESS THE OFFER IS EXTENDED. February 8, 2007 To Our Clients: Enclosed for your consideration is a Supplement to our Offer to Purchase dated January 22, 2007, and a related letter of transmittal (which, together with the original Offer to Purchase and any amendments or supplements thereto, collectively constitute the "Offer") relating to the Offer by the Mildred B. Horejsi Trust, an irrevocable grantor trust administered in accordance with Alaska administrative statutes and governed by Alaska trust law (the "Trust") to purchase all outstanding shares of common stock, par value $0.001 per share (the "shares"), of Putnam California Investment Grade Municipal Trust, a Massachusetts business trust ("PCA"), on the terms and subject to the conditions set forth in the Offer. We are the holder of record of shares held by us for your account. A tender of those shares can be made only by us as the holder of record and pursuant to your instructions. The letter of transmittal is furnished to you for your information only and cannot be used to tender shares held by us for your account. We request instructions as to whether you wish to tender any or all of the shares held by us for your account pursuant to the terms and subject to the conditions set forth in the Offer. Your attention is directed to the following: 1. The Offer price is $14.16 per share, net to you in cash (subject to applicable withholding of United States federal, state and local taxes), without interest thereon, on the terms and subject to the conditions set forth in the Offer. 2. The Offer is conditioned upon the conditions to the Offer described in Section 14 of the Offer to Purchase. Please note that one of these conditions requires that shares accepted for purchase that are tendered by shareholders holding shares as of February 15, 2007 must be accompanied by a valid irrevocable legal proxy to votes such shares. Pursuant to your instruction, we will deliver to the depository a legal proxy to vote such tendered shares on your behalf. 3. Tendering stockholders will not be obligated to pay brokerage fees or commissions to the depositary or the information agent or, except as set forth in Instruction 6 of the letter of transmittal, transfer taxes on the purchase of shares by the Purchasers pursuant to the Offer. However, federal income tax backup withholding at a rate of 28% may be required, unless an exemption is provided or unless the required taxpayer identification information is provided. See Instruction 9 of the letter of transmittal. If you wish to have us tender any of or all the shares held by us for your account, please so instruct us by completing, executing, detaching and returning to us the instruction form set forth below. An envelope to return your instructions to us is enclosed. If you authorize the tender of your shares, all such shares will be tendered unless you otherwise specify below. Your instructions to us should be forwarded promptly to permit us to submit a tender on your behalf prior to the expiration date. In all cases, payment for shares accepted for payment pursuant to the Offer will be made only after timely receipt by Colbent Corporation (the "depositary") of (1) the certificates for (or a timely book-entry confirmation (as defined in the Offer to Purchase) with respect to) such shares, (2) a letter of transmittal (or a facsimile thereof), properly completed and duly executed, with any required signature guarantees, or, in the case of a book-entry transfer effected pursuant to the procedures set forth in Section 3 of the Offer to Purchase, an agent's message (as defined in the Offer to Purchase), and (3) any other documents required by the letter of transmittal. Accordingly, tendering stockholders may be paid at different times depending on when certificates for shares or book-entry confirmations with respect to shares are actually received by the depositary. UNDER NO CIRCUMSTANCES WILL INTEREST BE PAID ON THE PURCHASE PRICE OF THE SHARES TO BE PAID BY THE PURCHASERS, REGARDLESS OF ANY EXTENSION OF OR AMENDMENT TO THE OFFER OR ANY DELAY IN PAYING FOR SUCH SHARES. The Offer is not being made to, nor will tenders be accepted from or on behalf of, holders of shares in any jurisdiction in which the making of the Offer or the acceptance thereof would not be in compliance with the laws of that jurisdiction. INSTRUCTION FORM WITH RESPECT TO THE OFFER TO PURCHASE FOR CASH ALL OUTSTANDING SHARES OF COMMON STOCK OF PUTNAM CALIFORNIA INVESTMENT GRADE MUNICIPAL TRUST The undersigned acknowledge(s) receipt of your letter enclosing the Offer to Purchase dated January 22, 2007 and the related letter of transmittal relating to the Offer by the Mildred B. Horejsi Trust to purchase up to 100% of the outstanding shares of common stock, par value $0.001 per share (the "shares"), of Putnam California Investment Grade Municipal Trust, a Massachusetts business trust. This will instruct you to tender the number of shares indicated below held by you for the account of the undersigned (or, if no amount is indicated below, all the shares held by you for the account of the undersigned) on the terms and subject to the conditions set forth in the Offer to Purchase and the related letter of transmittal. Number of Shares to be Tendered* _____________________________________________ _____________________________________________ _____________________________________________ shares Signatures Dated: _________________________________, 2007 _____________________________________________ _____________________________________________ _____________________________________________ Please type or print name(s) Address(es) (including Zip Code(s)): _____________________________________________ _____________________________________________ _____________________________________________ _____________________________________________ _____________________________________________ Area Code and Telephone No. _____________________________________________ Taxpayer Identification or Social Security No.: _____________________________________________
- ------------- * Unless otherwise indicated, it will be assumed that all shares held by us for your account are to be tendered. -----END PRIVACY-ENHANCED MESSAGE-----