On November 4, 2010, Columbia Seligman Premium Technology Growth
Fund, Inc. (NYSE: STK) (the Fund) declared a fourth quarterly
distribution, the first under its managed distribution policy, in
the amount of $0.4625 per share, which is equal to a quarterly rate
of 2.3125% (9.25% annualized) of the $20.00 offering price in the
Fund’s initial public offering in November 2009.
The distribution will be paid on November 23, 2010 (the
Payment Date) to Stockholders of record on November 16, 2010.
The ex-dividend date is November 12, 2010. It is anticipated
that the Fund will make a subsequent distribution under its managed
distribution policy in the month of February.
Prior to the managed distribution policy, the Fund paid
distributions pursuant to a level rate distribution policy. Under
its former distribution policy and consistent with the Investment
Company Act of 1940, as amended, the Fund could not distribute
long-term capital gains more often than once in any one taxable
year.
In October 2010, the Fund received exemptive relief from the
Securities and Exchange Commission that permits the Fund to make
periodic distributions of long-term capital gains more often than
once in any one taxable year. After consideration by the Fund’s
Board, the Fund adopted the current managed distribution policy
which allows the Fund to make periodic distributions of long-term
capital gains.
The following table sets forth the estimated breakdown of the
distribution noted above, on a per share basis, from the following
sources: net investment income; net realized short-term capital
gains; net realized long-term capital gains; and return of capital
or other capital source.
Sources
% Breakdown
of Distribution
US Dollar
Breakdown
of Distribution
Net Investment Income
0.00%
$0
Net Realized Short-Term Capital
Gains 32.58% $0.1507
Net Realized Long-Term Capital
Gains 0.00% $0
Return of Capital or other Capital Source
67.42% $0.3118
Total 100.00%
$0.4625
The following table sets forth the estimated breakdown, on a per
share basis, of all distributions made by the Fund during the
year-to-date period ended on the Payment Date (includes the
dividend payment noted in the table above) from the following
sources: net investment income; net realized short-term capital
gains; net realized long-term capital gains; and return of capital
or other capital source.
Sources
% Breakdown
of All Distributions Paid
Through Year To Date Period Ended on
the
Payment Date
US Dollar
Breakdown
of All Distributions
Paid Through Year
To Date Period
Ended on the
Payment Date
Net Investment Income
0.00%
$0
Net Realized Short-Term Capital
Gains 32.58% $0.6027
Net Realized Long-Term Capital
Gains 0.00% $0
Return of Capital or other Capital Source
67.42% $1.2473
Total 100.00%
$1.8500
The Fund estimates that it has distributed more than its income
and net realized capital gains. Therefore, a portion of your
distribution may be a return of capital or other capital source.
A return of capital may occur, for example, when some or all
of the money that you invested in the Fund is paid back to you. A
return of capital distribution does not necessarily reflect the
Fund’s investment performance and should not be confused with
“yield” or “income.”
The amounts, sources and percentage breakdown of the
distributions reported above are only estimates and are not being
provided for, and should not be used for, tax reporting purposes.
The actual amounts, sources and percentage breakdown of the
distribution for tax reporting purposes, which may include return
of capital, will depend upon the Fund’s investment experience
during the remainder of its fiscal year and may be subject to
changes based on tax regulations.
The following table sets forth (i) the average annual total
return of a share of the Fund’s common stock at net asset value
(NAV) for the period since inception of Fund investment operations
through the period noted* and (ii) the Fund’s annualized
distribution rate, for the same period, expressed as a percentage
of the NAV price of a share of the Fund’s common stock at October
31, 2010.
Average Annual Total NAV Return for
the
Period Since Inception of
Investment
Operations (November 30, 2009)
Through
October 31, 2010
Annualized Distribution Rate as a
Percentage of
October 31, 2010 NAV Price (For the
Period
Since Inception of Investment
Operations
(November 30, 2009) through October 31,
2010)
N/A%* 9.25%
* The Fund has less than one year of
investment operations and therefore average annual total NAV return
is not available.
The total return of the Fund since
inception (i.e., cumulative total return) is 13.62%.
The following table sets forth (i) the cumulative total
return (at NAV) of a share of the Fund’s common stock for the
year-to-date period ended October 31, 2010 and (ii) the Fund’s
distribution rate, for the same period, expressed as a percentage
of the NAV price of a share of the Fund’s common stock at October
31, 2010.
Cumulative Total NAV Return for the
Year-to
Date Period Ended October 31,
2010
Distribution Rate as a Percentage of
October
31, 2010 NAV Price (for the
Year-to-Date Period
Ended October 31, 2010)
7.89% 6.94%
You should not draw any conclusions about the Fund’s investment
performance from the amount of the distributions noted in the
tables above or from the terms of the Fund’s distribution
policy.
The Fund or your financial professional will send you a Form
1099-DIV for the calendar year that will tell you how to report
these distributions on your US federal income tax return. For tax
purposes, the Fund is required to report unrealized gains or losses
on certain non-US investments as ordinary income or loss,
respectively. Accordingly, the amount of the Fund’s total
distributions that will be taxable as ordinary income may be
different than the amount of the distributions from net investment
income reported above.
The Board may change the Fund’s distribution policy and the
amount or timing of the distributions, based on a number of
factors, including, but not limited to, the amount of the Fund’s
undistributed net investment income and net short- and long-term
capital gains and historical and projected net investment income
and net short- and long-term capital gains.
The Fund is a closed-end investment company that trades on the
New York Stock Exchange.
Important Disclosures:
You should consider the investment objectives, risks,
charges, and expenses of the Fund carefully before investing. You
can obtain the Fund’s most recent periodic reports and other
regulatory filings by contacting your financial advisor or American
Stock Transfer & Trust Company, LLC at 800 937-5449. These
reports and other filings can also be found on the Securities and
Exchange Commission’s EDGAR database. You should read these reports
and other filings carefully before investing.
The Fund expects to receive all or some of its current income
and gains from the following sources: (i) dividends received by the
Fund that are paid on the equity and equity-related securities in
its portfolio; and (ii) capital gains (short-term and long-term)
from option premiums and the sale of portfolio securities. It is
possible that the Fund’s distributions will at times exceed the
earnings and profits of the Fund and therefore all or a portion of
such distributions may constitute a return of capital as described
below. A return of capital is a return of your original investment.
A return of capital distribution does not necessarily reflect the
Fund’s investment performance and should not be confused with
“yield” or “income.” You should not draw any conclusions about the
Fund’s investment performance from the amount of this distribution
or from the Fund’s distribution policy.
A return of capital is not taxable, but it reduces a
stockholder’s tax basis in his or her shares, thus reducing any
loss or increasing any gain on a subsequent taxable disposition by
the stockholder of his or her shares. Distributions may be
variable, and the Fund’s distribution rate will depend on a number
of factors, including the net earnings on the Fund’s portfolio
investments and the rate at which such net earnings change as a
result of changes in the timing of, and rates at which, the Fund
receives income from the sources noted above. As portfolio and
market conditions change, the rate of dividends on the shares and
the Fund’s distribution policy could change. The Board may change
the Fund’s distribution policy and the amount or timing of the
distributions, based on a number of factors, including, but not
limited to, the amount of the Fund’s undistributed net investment
income and net short- and long-term capital gains and historical
and projected net investment income and net short- and long-term
capital gains.
The Fund should only be considered as one element of a complete
investment program. An investment in the Fund should be considered
speculative. The Fund's investment policy of investing in
technology and technology-related companies and writing call
options involves a high degree of risk.
There is no assurance that the Fund will meet its investment
objectives or that distributions will be made. You could lose some
or all of your investment. The net asset value of shares of a
closed-end fund may not always correspond to the market price of
such shares. Common stock of many closed-end funds frequently trade
at a discount from their net asset value, which may increase your
risk of loss. The Fund is subject to stock market risk, which is
the risk that stock prices overall will decline over short or long
periods, adversely affecting the value of an investment in the
Fund.
The market prices of technology and technology-related stocks
tend to exhibit a greater degree of market risk and price
volatility than other types of investments. These stocks may fall
in and out of favor with investors rapidly, which may cause sudden
selling and dramatically lower market prices. These stocks also may
be affected adversely by changes in technology, consumer and
business purchasing patterns, government regulation and/or obsolete
products or services. Technology and technology-related companies
are often smaller and less experienced companies and may be subject
to greater risks than larger companies, such as limited product
lines, markets and financial and managerial resources. These risks
may be heightened for technology companies in foreign markets.
This press release was prepared by Columbia Management
Investment Distributors, Inc., Member FINRA. Columbia Seligman
Premium Technology Growth Fund is managed by Columbia Management
Investment Advisers, LLC (formerly known as RiverSource
Investments, LLC). Columbia Management is part of Ameriprise
Financial, Inc. Seligman is an offering brand of Columbia
Management.
© 2010 Columbia Management Investment Advisers, LLC. All rights
reserved.
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