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 811-22328
COLUMBIA SELIGMAN PREMIUM TECHNOLOGY GROWTH FUND, INC.
(Exact name of registrant as specified in charter)
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50606 Ameriprise Financial Center, Minneapolis, Minnesota
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55474
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(Address of principal executive offices)
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(Zip code)
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Scott R. Plummer 5228 Ameriprise Financial Center, Minneapolis, MN 55474
(Name and address of agent for service)
Registrants
telephone number, including area code:
(612) 671-1947
Date of
fiscal year end:
December 31
Date of
reporting period:
June 30, 2011
Item 1. Reports to Stockholders.
Semiannual Report
Semiannual
Report
Columbia
Seligman Premium Technology Growth Fund
Semiannual
Report for the Period Ended
June 30,
2011
Columbia
Seligman Premium Technology Growth Fund seeks growth of capital
and current income.
Not
FDIC
insured
-
No
bank
guarantee
-
May
lose value
Under the Funds managed distribution policy and subject to
the approval of the Funds Board of Directors (the Board),
the Fund expects to make quarterly cash distributions (in
November, February, May, and August) to Common Stockholders. The
Funds most recent distribution
(August 2011) amounted to $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 Funds initial public offering
in November 2009. You should not draw any conclusions about
the Funds investment performance from the amount of the
distribution or from the terms of the Funds distribution
policy. 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. 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
Funds investment performance and should not be confused
with yield or income. The Board may
determine in the future that the Funds managed
distribution policy and the amount or timing of the
distributions should not be continued in light of changes in the
Funds portfolio holdings, market or other conditions or
factors, including that the distribution rate under such policy
may not be dependent upon the amount of the Funds earned
income or realized capital gains. The Board could also consider
amending or terminating the current distribution policy because
of potential adverse tax consequences associated with
maintaining the policy. In certain situations, returns of
capital could be taxable for federal income tax purposes, and
all or a portion of the Funds capital loss carryforwards
from prior years, if any, could effectively be forfeited. The
Board may amend or terminate the Funds distribution policy
at any time without prior notice to Fund stockholders; any such
change or termination may have an adverse effect on the market
price of the Funds shares.
See Notes to Financial Statements for additional information
related to the Funds managed distribution policy.
COLUMBIA
SELIGMAN PREMIUM TECHNOLOGY GROWTH FUND 2011
SEMIANNUAL REPORT
Dear
Stockholders,
We are pleased to present the semiannual stockholder report for
Columbia Seligman Premium Technology Growth Fund (the Fund). The
report includes the Funds investment results, portfolio of
investment and financial statements as of June 30, 2011.
The Funds Common Stock fell 0.38% based on net asset value
and rose 4.03% based on market price, for the six months ended
June 30, 2011. The Funds benchmark, the S&P
North American Technology Sector Index, increased 3.02% during
the same period.
During the first half of 2011, the Fund paid two distributions
that aggregated $0.925 per share. These distributions were made
pursuant to the Funds managed distribution policy, with
each distribution equal to a quarterly rate of 2.3125% (9.25%
annualized) of the $20.00 offering price in the Funds
initial public offering in November 2009. Unless you elected
otherwise, distributions were paid in additional shares of the
Fund.
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
Funds investment performance and should not be confused
with yield or income.
On behalf of the Board, we would like to thank you for your
support of Columbia Seligman Premium Technology Growth Fund.
Stephen R. Lewis
Chairman of the Board
For
more information, go online to columbiamanagement.com; or call
American Stock Transfer & Trust Company, LLC, the
Funds Stockholder Servicing Agent, at 800.937.5449.
Customer Service Representatives are available to answer your
questions Monday through Friday from 9 a.m. to
5 p.m. Eastern time.
COLUMBIA
SELIGMAN PREMIUM TECHNOLOGY GROWTH FUND 2011
SEMIANNUAL REPORT
This page left
blank intentionally
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Your Fund at a Glance
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2
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Portfolio of Investments
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5
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Statement of Assets and Liabilities
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11
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Statement of Operations
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12
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Statement of Changes in Net Assets
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13
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Financial Highlights
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14
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Notes to Financial Statements
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16
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Proxy Voting
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37
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Approval of Investment Management Services Agreement
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37
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Results of Meeting of Stockholders
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41
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COLUMBIA
SELIGMAN PREMIUM TECHNOLOGY GROWTH FUND 2011
SEMIANNUAL REPORT 1
(Unaudited)
FUND
SUMMARY
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>
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Columbia Seligman Premium
Technology Growth Fund (the Fund) Common Stock fell 0.38% based
on net asset value and rose 4.03% based on market price, for the
six months ended June 30, 2011.
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>
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The Funds benchmark, the
S&P North American Technology Sector Index, increased 3.02%
for the same six-month period.
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ANNUALIZED
TOTAL RETURNS
(for
period ended June 30, 2011)
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Since
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inception
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6
months*
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1 year
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11/30/2009
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Columbia Seligman Premium
Technology
Growth Fund
Market Price
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+4.03%
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+15.68%
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+6.00%
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(a)
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Net Asset Value
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-0.38%
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+25.64%
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+10.81%
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(b)
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S&P North American Technology Sector
Index
(1)
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+3.02%
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+29.52%
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+14.01%
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(c)
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*
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Not
annualized.
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(a)
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Since
inception total return for market price is based on the initial
offering price on November 24, 2009, which was $20.00 per
share.
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(b)
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Since
inception total return for net asset value (NAV) is from the
opening of business on November 30, 2009 and includes the
4.50% initial sales load. The NAV price per share of the
Funds Common Stock at inception was $19.10.
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(c)
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Index
data is from November 30, 2009.
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The
performance information shown represents past performance and is
not a guarantee of future results. The investment return and
principal value of your investment will fluctuate so that your
shares, when sold, may be worth more or less than their original
cost. Current performance may be lower or higher than the
performance information shown. You may obtain performance
information current to the most recent month-end by visiting
columbiamanagement.com.
Returns
reflect changes in market price or net asset value, as
applicable, and assume reinvestment of distributions. Returns do
not reflect the deduction of taxes that investors may pay on
distributions or the sale of shares.
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(1)
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The
S&P North American Technology Sector Index is an unmanaged
modified capitalization-weighted index based on a universe of
technology-related stocks. The index reflects reinvestment of
all distributions and changes in market prices. The index does
not reflect the effects of sales charges, expenses and taxes. It
is not possible to invest directly in an index.
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2 COLUMBIA
SELIGMAN PREMIUM TECHNOLOGY GROWTH FUND 2011
SEMIANNUAL REPORT
PRICE
PER SHARE
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June 30,
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March 31,
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December 31,
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2011
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2011
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2010
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Market price
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$
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19.00
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$
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19.38
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$
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19.13
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Net asset value
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19.45
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20.31
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20.45
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DISTRIBUTIONS
PAID PER COMMON SHARE
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Payable
date
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Per share
amount
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February 23, 2011
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$
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0.4625
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May 25, 2011
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0.4625
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The net asset value
of the Funds shares 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.
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.
COLUMBIA
SELIGMAN PREMIUM TECHNOLOGY GROWTH FUND 2011
SEMIANNUAL REPORT 3
Your
Fund at a
Glance
(continued)
SECTOR
BREAKDOWN
(1)
(at June 30, 2011)
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Consumer Discretionary
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1.6
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%
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Health Care
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1.8
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Industrials
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0.5
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Information Technology
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94.9
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Other
(2)
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1.2
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(1)
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Sectors
can be comprised of several industries. Please refer to the
section entitled Portfolio of Investments for a
complete listing.
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Percentages
indicated are based upon total investments. The Funds
composition is subject to change.
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(2)
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Money
Market Fund.
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TOP
TEN
HOLDINGS
(1)
(at June 30, 2011)
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Synopsys, Inc.
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7.7
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%
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KLA-Tencor Corp.
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5.8
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Symantec Corp.
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5.7
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ASML Holding NV
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5.2
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NetApp, Inc.
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4.7
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Intel Corp.
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4.5
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Amdocs Ltd.
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4.4
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BMC Software, Inc.
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4.4
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QUALCOMM, Inc.
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4.2
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Apple, Inc.
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4.2
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(1)
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Percentages
indicated are based upon total investments (excluding Money
Market Fund).
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For further detail
about these holdings, please refer to the section entitled
Portfolio of Investments.
Fund holdings are of
the date given, are subject to change at any time, and are not
recommendations to buy or sell any security.
4 COLUMBIA
SELIGMAN PREMIUM TECHNOLOGY GROWTH FUND 2011
SEMIANNUAL REPORT
Columbia Seligman Premium Technology Growth Fund
June 30,
2011 (Unaudited)
(Percentages
represent value of investments compared to net assets)
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Issuer
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Shares
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Value
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Common
Stocks 101.9%
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CONSUMER
DISCRETIONARY 1.7%
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Internet & Catalog
Retail 0.5%
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Amazon.com,
Inc.
(a)
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6,600
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$
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1,349,634
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Media 1.2%
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Virgin Media, Inc.
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56,000
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1,676,080
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Walt Disney Co. (The)
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49,700
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1,940,288
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Total
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3,616,368
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TOTAL CONSUMER
DISCRECTIONARY
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4,966,002
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HEALTH CARE 1.8%
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Health Care
Equipment & Supplies 1.1%
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Olympus
Corp.
(b)
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55,400
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1,869,310
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Sirona Dental Systems,
Inc.
(a)
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28,800
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1,529,280
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Total
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3,398,590
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Pharmaceuticals 0.7%
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Hospira,
Inc.
(a)
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35,300
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2,000,098
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TOTAL HEALTH CARE
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5,398,688
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INDUSTRIALS 0.5%
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Electrical
Equipment 0.5%
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Nidec
Corp.
(b)
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16,800
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1,568,453
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TOTAL INDUSTRIALS
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1,568,453
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INFORMATION
TECHNOLOGY 97.9%
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Communications
Equipment 4.3%
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QUALCOMM, Inc.
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224,245
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12,734,873
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Computers &
Peripherals 14.7%
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Apple,
Inc.
(a)(c)
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37,900
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12,721,893
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EMC
Corp.
(a)
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142,400
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3,923,120
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Hewlett-Packard
Co.
(c)
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300,200
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10,927,280
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NetApp,
Inc.
(a)
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268,600
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14,176,708
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Toshiba
Corp.
(b)
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293,200
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1,545,852
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Total
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43,294,853
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Electronic Equipment,
Instruments & Components 2.7%
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Avnet,
Inc.
(a)
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164,300
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5,237,884
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Elster Group SE,
ADR
(a)(b)
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12,989
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212,760
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Jabil Circuit, Inc.
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121,500
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2,454,300
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Total
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7,904,944
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Internet Software &
Services 1.0%
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WebMD Health
Corp.
(a)
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31,700
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1,444,886
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Yandex NV,
Series A
(a)(b)
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45,123
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1,602,318
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Total
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3,047,204
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IT Services 6.7%
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Amdocs
Ltd.
(a)(b)
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436,460
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13,264,019
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hiSoft Technology International Ltd.,
ADR
(a)(b)
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40,084
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587,231
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VeriFone Systems,
Inc.
(a)
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39,800
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1,765,130
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Visa, Inc., Class A
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48,500
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4,086,610
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Total
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19,702,990
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Office
Electronics 2.5%
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Xerox Corp.
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707,300
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7,362,993
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Semiconductors &
Semiconductor Equipment 27.4%
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Advanced Micro Devices,
Inc.
(a)
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1,540,055
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|
10,764,985
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Altera Corp.
|
|
|
19,800
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|
|
917,730
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Amkor Technology,
Inc.
(a)
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304,359
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|
|
1,877,895
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Analog Devices, Inc.
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|
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21,600
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845,424
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ASML Holding
NV
(b)
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422,100
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15,600,816
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Broadcom Corp.,
Class A
(a)
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58,500
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1,967,940
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Intel Corp.
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|
|
615,016
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|
|
13,628,755
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KLA-Tencor Corp.
|
|
|
428,300
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|
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17,337,584
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Lam Research
Corp.
(a)
|
|
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70,200
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|
3,108,456
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Marvell Technology Group
Ltd.
(a)(b)
|
|
|
134,739
|
|
|
1,989,421
|
Maxim Integrated Products, Inc.
|
|
|
4,400
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|
|
112,464
|
Microsemi
Corp.
(a)
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|
|
133,600
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|
|
2,738,800
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Novellus Systems,
Inc.
(a)
|
|
|
215,800
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|
|
7,799,012
|
Spansion, Inc.,
Class A
(a)
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|
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105,875
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|
|
2,040,211
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|
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Total
|
|
|
|
|
|
80,729,493
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Software 38.6%
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Aspen Technology,
Inc.
(a)
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|
|
36,196
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|
|
621,847
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BMC Software,
Inc.
(a)
|
|
|
241,662
|
|
|
13,218,911
|
CA, Inc.
|
|
|
44,300
|
|
|
1,011,812
|
Check Point Software Technologies
Ltd.
(a)(b)
|
|
|
138,450
|
|
|
7,870,883
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JDA Software Group,
Inc.
(a)
|
|
|
180,800
|
|
|
5,584,912
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Microsoft Corp.
|
|
|
471,500
|
|
|
12,259,000
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Nuance Communications,
Inc.
(a)
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|
|
520,000
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|
|
11,164,400
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Oracle Corp.
|
|
|
334,700
|
|
|
11,014,977
|
Parametric Technology
Corp.
(a)(c)
|
|
|
406,668
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|
|
9,324,897
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Quest Software,
Inc.
(a)
|
|
|
12,100
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|
|
275,033
|
The accompanying
Notes to Financial Statements are an integral part of this
statement.
COLUMBIA
SELIGMAN PREMIUM TECHNOLOGY GROWTH FUND 2011
SEMIANNUAL REPORT 5
Portfolio
of Investments
(continued)
|
|
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|
|
|
|
Issuer
|
|
Shares
|
|
Value
|
|
Common
Stocks (continued)
|
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INFORMATION
TECHNOLOGY (cont.)
|
|
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|
|
Software (cont.)
|
Symantec
Corp.
(a)
|
|
|
862,300
|
|
|
$17,004,556
|
Synopsys,
Inc.
(a)
|
|
|
905,284
|
|
|
23,274,852
|
VMware, Inc.,
Class A
(a)(c)
|
|
|
13,000
|
|
|
1,302,990
|
|
|
|
|
|
|
|
Total
|
|
|
|
|
|
113,929,070
|
|
|
TOTAL INFORMATION
TECHNOLOGY
|
|
|
288,706,420
|
|
|
Total Common Stocks
|
|
|
|
(Cost: $273,851,565)
|
|
$
|
300,639,563
|
|
|
Money Market
Fund 1.2%
|
|
|
|
|
|
|
|
Columbia Short-Term Cash Fund,
0.166%
(d)(e)(f)
|
|
|
3,554,219
|
|
$
|
3,554,219
|
|
|
Total Money Market
Fund
|
|
|
|
(Cost: $3,554,219)
|
|
$
|
3,554,219
|
|
|
Total Investments
|
|
|
|
(Cost: $277,405,784)
|
|
$
|
304,193,782
|
Other Assets &
Liabilities, Net
|
|
|
(9,274,568)
|
|
|
Net Assets
|
|
$
|
294,919,214
|
|
|
Investments
in Derivatives
Open
Options Contracts Written at June 30, 2011
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Number of
|
|
Exercise
|
|
Premium
|
|
Expiration
|
|
|
Issuer
|
|
Puts/Calls
|
|
Contracts
|
|
Price
|
|
Received
|
|
Date
|
|
Value
|
Apple, Inc.
|
|
|
Call
|
|
|
|
20
|
|
|
|
$375.00
|
|
|
|
$21,054
|
|
|
|
October 2011
|
|
|
|
$12,650
|
|
Apple, Inc.
|
|
|
Call
|
|
|
|
21
|
|
|
|
370.00
|
|
|
|
25,466
|
|
|
|
October 2011
|
|
|
|
15,803
|
|
Hewlett-Packard Co.
|
|
|
Call
|
|
|
|
364
|
|
|
|
43.00
|
|
|
|
23,545
|
|
|
|
November 2011
|
|
|
|
12,012
|
|
Hewlett-Packard Co.
|
|
|
Put
|
|
|
|
474
|
|
|
|
33.00
|
|
|
|
68,878
|
|
|
|
November 2011
|
|
|
|
50,718
|
|
Microsoft Corp.
|
|
|
Put
|
|
|
|
646
|
|
|
|
25.00
|
|
|
|
103,801
|
|
|
|
January 2012
|
|
|
|
94,639
|
|
NASDAQ 100 Index
|
|
|
Call
|
|
|
|
650
|
|
|
|
225.00
|
|
|
|
2,273,216
|
|
|
|
July 2011
|
|
|
|
6,795,750
|
|
Parametric Technology Corp.
|
|
|
Call
|
|
|
|
488
|
|
|
|
25.00
|
|
|
|
33,518
|
|
|
|
July 2011
|
|
|
|
4,880
|
|
VMware, Inc., Class A
|
|
|
Call
|
|
|
|
65
|
|
|
|
110.00
|
|
|
|
23,574
|
|
|
|
October 2011
|
|
|
|
30,550
|
|
VMware, Inc., Class A
|
|
|
Call
|
|
|
|
65
|
|
|
|
105.00
|
|
|
|
32,674
|
|
|
|
October 2011
|
|
|
|
42,250
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$7,059,252
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Notes
to Portfolio of Investments
|
|
|
(a)
|
|
Non-income
producing.
|
|
(b)
|
|
Represents
a foreign security. At June 30, 2011, the value of foreign
securities, excluding short-term securities, represented 15.64%
of net assets.
|
|
(c)
|
|
At
June 30, 2011, securities valued at $5,123,181 were held to
cover open call options written.
|
|
(d)
|
|
The
rate shown is the
seven-day
current annualized yield at June 30, 2011.
|
The accompanying
Notes to Financial Statements are an integral part of this
statement.
6 COLUMBIA
SELIGMAN PREMIUM TECHNOLOGY GROWTH FUND 2011
SEMIANNUAL REPORT
Notes
to Portfolio of Investments (continued)
|
|
|
(e)
|
|
Investments
in affiliates during the period ended June 30, 2011:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dividends
|
|
|
|
|
|
|
|
|
Sales Cost/
|
|
|
|
|
|
or
|
|
|
|
|
Beginning
|
|
Purchase
|
|
Proceeds
|
|
Realized
|
|
Ending
|
|
Interest
|
|
|
Issuer
|
|
Cost
|
|
Cost
|
|
from
Sales
|
|
Gain/Loss
|
|
Cost
|
|
Income
|
|
Value
|
Columbia Short-Term Cash Fund
|
|
|
$6,981,679
|
|
|
|
$75,516,468
|
|
|
|
$(78,943,928
|
)
|
|
|
$
|
|
|
|
$3,554,219
|
|
|
|
$8,985
|
|
|
|
$3,554,219
|
|
|
|
|
(f)
|
|
At
June 30, 2011, cash or short-term securities were
designated to cover open put
and/or
call
options written.
|
Abbreviation
Legend
|
|
|
ADR
|
|
American Depositary Receipt
|
The accompanying
Notes to Financial Statements are an integral part of this
statement.
COLUMBIA
SELIGMAN PREMIUM TECHNOLOGY GROWTH FUND 2011
SEMIANNUAL REPORT 7
Portfolio
of Investments
(continued)
Fair
Value Measurements
Generally accepted
accounting principles (GAAP) require disclosure regarding the
inputs and valuation techniques used to measure fair value and
any changes in valuation inputs or techniques. In addition,
investments shall be disclosed by major category.
The Fund categorizes
its fair value measurements according to a three-level hierarchy
that maximizes the use of observable inputs and minimizes the
use of unobservable inputs by prioritizing that the most
observable input be used when available. Observable inputs are
those that market participants would use in pricing an
investment based on market data obtained from sources
independent of the reporting entity. Unobservable inputs are
those that reflect the Funds assumptions about the
information market participants would use in pricing an
investment. An investments level within the fair value
hierarchy is based on the lowest level of any input that is
deemed significant to the asset or liabilitys fair value
measurement. The input levels are not necessarily an indication
of the risk or liquidity associated with investments at that
level. For example, certain U.S. government securities are
generally high quality and liquid, however, they are reflected
as Level 2 because the inputs used to determine fair value
may not always be quoted prices in an active market.
Fair value inputs
are summarized in the three broad levels listed below:
|
|
|
|
|
Level 1
Valuations based on quoted prices for investments in active
markets that the Fund has the ability to access at the
measurement date (including NAV for open-end mutual funds).
Valuation adjustments are not applied to Level 1
investments.
|
|
|
|
Level 2
Valuations based on other significant observable inputs
(including quoted prices for similar securities, interest rates,
prepayment speeds, credit risks, etc.).
|
|
|
|
Level 3
Valuations based on significant unobservable inputs (including
the Funds own assumptions and judgment in determining the
fair value of investments).
|
Inputs that are used
in determining fair value of an investment may include price
information, credit data, volatility statistics, and other
factors. These inputs can be either observable or unobservable.
The availability of observable inputs can vary between
investments, and is affected by various factors such as the type
of investment, and the volume and level of activity for that
investment or similar investments in the marketplace. The inputs
will be considered by the Fund Administrator, along with any
other relevant factors in the calculation of an
investments fair value. The Fund uses prices and inputs
that are current as of the measurement date, which may include
periods of market dislocations. During these periods, the
availability of prices and inputs may be reduced for many
investments. This condition could cause an investment to be
reclassified between the various levels within the hierarchy.
Foreign equity
securities actively traded in markets where there is a
significant delay in the local close relative to the New York
Stock Exchange (NYSE) are classified as Level 2. The values
of these securities may include an adjustment to reflect the
impact of significant market movements following the close of
local trading, as described in Note 2 to the financial
statements Security Valuation.
The accompanying
Notes to Financial Statements are an integral part of this
statement.
8 COLUMBIA
SELIGMAN PREMIUM TECHNOLOGY GROWTH FUND 2011
SEMIANNUAL REPORT
Fair
Value Measurements (continued)
Investments falling
into the Level 3 category are primarily supported by quoted
prices from brokers and dealers participating in the market for
those investments. However, these may be classified as
Level 3 investments due to lack of market transparency and
corroboration to support these quoted prices. Additionally,
valuation models may be used as the pricing source for any
remaining investments classified as Level 3. These models
rely on one or more significant unobservable inputs
and/or
significant assumptions by the Fund Administrator. Inputs used
in valuations may include, but are not limited to, financial
statement analysis, capital account balances, discount rates and
estimated cash flows, and comparable company data.
The following table
is a summary of the inputs used to value the Funds
investments as of June 30, 2011:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fair Value at
June 30, 2011
|
|
|
|
Level 1
|
|
|
Level 2
|
|
|
|
|
|
|
|
|
|
Quoted Prices
|
|
|
Other
|
|
|
Level 3
|
|
|
|
|
|
|
in Active
|
|
|
Significant
|
|
|
Significant
|
|
|
|
|
|
|
Markets for
|
|
|
Observable
|
|
|
Unobservable
|
|
|
|
|
Description
(a)
|
|
Identical
Assets
|
|
|
Inputs
(b)
|
|
|
Inputs
|
|
|
Total
|
|
Equity Securities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Common Stocks
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consumer Discretionary
|
|
|
$4,966,002
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$4,966,002
|
|
Health Care
|
|
|
3,529,378
|
|
|
|
1,869,310
|
|
|
|
|
|
|
|
5,398,688
|
|
Industrials
|
|
|
|
|
|
|
1,568,453
|
|
|
|
|
|
|
|
1,568,453
|
|
Information Technology
|
|
|
287,160,568
|
|
|
|
1,545,852
|
|
|
|
|
|
|
|
288,706,420
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Equity Securities
|
|
|
295,655,948
|
|
|
|
4,983,615
|
|
|
|
|
|
|
|
300,639,563
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Affiliated Money Market
Fund
(c)
|
|
|
3,554,219
|
|
|
|
|
|
|
|
|
|
|
|
3,554,219
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Other
|
|
|
3,554,219
|
|
|
|
|
|
|
|
|
|
|
|
3,554,219
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Investments in Securities
|
|
|
299,210,167
|
|
|
|
4,983,615
|
|
|
|
|
|
|
|
304,193,782
|
|
Derivatives
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Options Contracts Written
|
|
|
(7,059,252
|
)
|
|
|
|
|
|
|
|
|
|
|
(7,059,252
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
|
$292,150,915
|
|
|
|
$4,983,615
|
|
|
|
$
|
|
|
|
$297,134,530
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a)
|
|
See
the Portfolio of Investments for all investment classifications
not indicated in the table.
|
|
(b)
|
|
There
were no significant transfers between Levels 1 and 2 during
the period.
|
|
(c)
|
|
Money
market fund that is a sweep investment for cash balances in the
Fund at June 30, 2011.
|
The accompanying
Notes to Financial Statements are an integral part of this
statement.
COLUMBIA
SELIGMAN PREMIUM TECHNOLOGY GROWTH FUND 2011
SEMIANNUAL REPORT 9
Portfolio
of Investments
(continued)
Fair
Value Measurements (continued)
How
to find information about the Funds quarterly portfolio
holdings
|
|
|
(i)
|
|
The
Fund files its complete schedule of portfolio holdings with the
Securities and Exchange Commission (SEC) for the first and third
quarters of each fiscal year on
Form N-Q;
|
|
(ii)
|
|
The
Funds
Forms N-Q
are available on the SECs website at www.sec.gov;
|
|
(iii)
|
|
The
Funds
Forms N-Q
may be reviewed and copied at the SECs Public Reference
Room in Washington, DC (information on the operations of the
Public Reference Room may be obtained by calling 800.SEC.0330);
and
|
|
(iv)
|
|
The
Funds complete schedule of portfolio holdings, as filed on
Form N-Q,
can be obtained without charge, upon request, by calling
800.937.5449.
|
The accompanying
Notes to Financial Statements are an integral part of this
statement.
10 COLUMBIA
SELIGMAN PREMIUM TECHNOLOGY GROWTH FUND 2011
SEMIANNUAL REPORT
Statement
of Assets and Liabilities
June 30, 2011 (Unaudited)
|
|
|
|
|
Assets
|
Investments, at value
|
|
|
|
|
Unaffiliated issuers (identified cost $273,851,565)
|
|
$
|
300,639,563
|
|
Affiliated issuers (identified cost $3,554,219)
|
|
|
3,554,219
|
|
|
|
|
|
|
Total investments (identified cost $277,405,784)
|
|
|
304,193,782
|
|
Cash
|
|
|
516
|
|
Receivable for:
|
|
|
|
|
Investments sold
|
|
|
1,786,369
|
|
Dividends
|
|
|
66,994
|
|
|
|
|
|
|
Total assets
|
|
|
306,047,661
|
|
|
|
|
|
|
Liabilities
|
Options contracts written, at value (proceeds $2,605,726)
|
|
|
7,059,252
|
|
Payable for:
|
|
|
|
|
Investments purchased
|
|
|
3,567,604
|
|
Investment management fees
|
|
|
239,038
|
|
Stockholder account and registrar fees
|
|
|
8,209
|
|
Administration fees
|
|
|
14,342
|
|
Stockholders meeting fees
|
|
|
28,934
|
|
Other expenses
|
|
|
211,068
|
|
|
|
|
|
|
Total liabilities
|
|
|
11,128,447
|
|
|
|
|
|
|
Net assets applicable to outstanding Common Stock
|
|
$
|
294,919,214
|
|
|
|
|
|
|
Represented
by
|
|
|
|
|
Paid-in capital
|
|
$
|
277,294,139
|
|
Excess of distributions over net investment income
|
|
|
(14,629,354
|
)
|
Accumulated net realized gain
|
|
|
9,920,360
|
|
Unrealized appreciation (depreciation) on:
|
|
|
|
|
Investments
|
|
|
26,787,998
|
|
Foreign currency translations
|
|
|
(403
|
)
|
Options contracts written
|
|
|
(4,453,526
|
)
|
|
|
|
|
|
Total representing net assets applicable to
outstanding Common Stock
|
|
$
|
294,919,214
|
|
|
|
|
|
|
Shares outstanding applicable to Common Stock
|
|
|
15,159,834
|
|
|
|
|
|
|
Net asset value per share of outstanding Common Stock
|
|
$
|
19.45
|
|
|
|
|
|
|
Market price per share of outstanding Common Stock
|
|
$
|
19.00
|
|
|
|
|
|
|
The accompanying
Notes to Financial Statements are an integral part of this
statement.
COLUMBIA
SELIGMAN PREMIUM TECHNOLOGY GROWTH FUND 2011
SEMIANNUAL REPORT 11
Six
months ended June 30, 2011 (Unaudited)
|
|
|
|
|
Net investment
income
|
Income:
|
|
|
|
|
Dividends
|
|
$
|
1,106,865
|
|
Dividends from affiliates
|
|
|
8,985
|
|
Foreign taxes withheld
|
|
|
(32,993
|
)
|
|
|
|
|
|
Total income
|
|
|
1,082,857
|
|
|
|
|
|
|
Expenses:
|
|
|
|
|
Investment management fees
|
|
|
1,523,984
|
|
Stockholder account and registrar fees
|
|
|
13,550
|
|
Administration fees
|
|
|
91,437
|
|
Compensation of board members
|
|
|
5,529
|
|
Stockholders meeting fees
|
|
|
37,767
|
|
Custodian fees
|
|
|
8,765
|
|
Printing and postage fees
|
|
|
23,300
|
|
Professional fees
|
|
|
29,241
|
|
Other
|
|
|
17,815
|
|
|
|
|
|
|
Total expenses
|
|
|
1,751,388
|
|
|
|
|
|
|
Net investment loss
|
|
|
(668,531
|
)
|
|
|
|
|
|
Realized and
unrealized gain (loss) net
|
Net realized gain (loss) on:
|
|
|
|
|
Investments
|
|
|
15,256,545
|
|
Foreign currency transactions
|
|
|
21,949
|
|
Forward foreign currency exchange contracts
|
|
|
(7,895
|
)
|
Options contracts written
|
|
|
(4,258,690
|
)
|
|
|
|
|
|
Net realized gain
|
|
|
11,011,909
|
|
Net change in unrealized appreciation (depreciation) on:
|
|
|
|
|
Investments
|
|
|
(6,054,804
|
)
|
Foreign currency translations
|
|
|
(403
|
)
|
Options contracts written
|
|
|
(5,311,691
|
)
|
|
|
|
|
|
Net change in unrealized depreciation
|
|
|
(11,366,898
|
)
|
|
|
|
|
|
Net realized and unrealized loss
|
|
|
(354,989
|
)
|
|
|
|
|
|
Net decrease in net assets from operations
|
|
$
|
(1,023,520
|
)
|
|
|
|
|
|
The accompanying
Notes to Financial Statements are an integral part of this
statement.
12 COLUMBIA
SELIGMAN PREMIUM TECHNOLOGY GROWTH FUND 2011
SEMIANNUAL REPORT
Statement
of Changes in Net Assets
|
|
|
|
|
|
|
|
|
|
|
Six months
ended
|
|
|
Year ended
|
|
|
|
June 30,
2011
|
|
|
December 31,
2010
|
|
|
|
(Unaudited)
|
|
|
|
|
Operations
|
Net investment loss
|
|
$
|
(668,531
|
)
|
|
$
|
(1,711,378
|
)
|
Net realized gain
|
|
|
11,011,909
|
|
|
|
14,554,778
|
|
Net change in unrealized appreciation (depreciation)
|
|
|
(11,366,898
|
)
|
|
|
23,548,520
|
|
|
|
|
|
|
|
|
|
|
Net change in net assets resulting from operations
|
|
|
(1,023,520
|
)
|
|
|
36,391,920
|
|
|
|
|
|
|
|
|
|
|
Distributions to Stockholders:
|
Net investment income
|
|
|
(13,959,208
|
)
|
|
|
(16,837,276
|
)
|
Tax return of capital
|
|
|
|
|
|
|
(10,769,739
|
)
|
|
|
|
|
|
|
|
|
|
Total distributions to Stockholders
|
|
|
(13,959,208
|
)
|
|
|
(27,607,015
|
)
|
|
|
|
|
|
|
|
|
|
Increase in net assets from capital share transactions
|
|
|
1,841,745
|
|
|
|
14,400,320
|
|
|
|
|
|
|
|
|
|
|
Total increase (decrease) in net assets
|
|
|
(13,140,983
|
)
|
|
|
23,185,225
|
|
Net assets at beginning of period
|
|
|
308,060,197
|
|
|
|
284,874,972
|
|
|
|
|
|
|
|
|
|
|
Net assets at end of period
|
|
$
|
294,919,214
|
|
|
$
|
308,060,197
|
|
|
|
|
|
|
|
|
|
|
Excess of distributions over net investment income
|
|
$
|
(14,629,354
|
)
|
|
$
|
(1,615
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six months
ended
|
|
|
|
|
|
|
June 30, 2011
|
|
|
Year ended
|
|
|
|
(Unaudited)
|
|
|
December 31,
2010
|
|
|
|
Shares
|
|
|
Dollars
($)
|
|
|
Shares
|
|
|
Dollars
($)
|
|
Capital stock
activity
|
Net proceeds from issuance of shares
|
|
|
|
|
|
|
|
|
|
|
545,000
|
(a)
|
|
|
10,387,700
|
|
Value of shares issued for distributions
|
|
|
93,163
|
|
|
|
1,841,745
|
|
|
|
216,421
|
|
|
|
4,012,620
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total net increase
|
|
|
93,163
|
|
|
|
1,841,745
|
|
|
|
761,421
|
|
|
|
14,400,320
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a)
|
|
Offering
costs of $21,800, incurred in connection with the initial
offering, have been charged against the proceeds from issuance
of shares for the year ended December 31, 2010.
|
The accompanying
Notes to Financial Statements are an integral part of this
statement.
COLUMBIA
SELIGMAN PREMIUM TECHNOLOGY GROWTH FUND 2011
SEMIANNUAL REPORT 13
The Funds financial highlights are presented below. Per
share operating performance data is designed to allow investors
to trace the operating performance, on a per Common share basis,
from the beginning net asset value to the ending net asset
value, so that investors can understand what effect the
individual items have on their investment, assuming it was held
throughout the period. Generally, the per share amounts are
derived by converting the actual dollar amounts incurred for
each item, as disclosed in the financial statements, to their
equivalent per Common share amounts, using average Common shares
outstanding during the period.
Total return measures the Funds performance assuming that
investors purchased Fund shares at market price or net asset
value as of the beginning of the period, reinvested all their
distributions, and then sold their shares at the closing market
price or net asset value on the last day of the period. The
computations do not reflect taxes or any sales commissions
investors may incur in purchasing or selling Fund shares and
taxes investors may incur on distributions or on the sale of
Fund shares. Total returns are not annualized for periods of
less than one year.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six months
|
|
|
|
|
|
|
|
|
|
ended
June 30,
|
|
|
Year ended
Dec. 31,
|
|
|
|
2011
|
|
|
2010
|
|
|
2009
(a)
|
|
|
|
(Unaudited)
|
|
|
|
|
|
|
|
Per share
data
|
|
|
|
|
|
|
|
|
|
|
|
|
Net asset value, beginning of period
|
|
|
$20.45
|
|
|
|
$19.91
|
|
|
|
$19.10
|
(b)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income from investment operations:
|
|
|
|
|
|
|
|
|
|
|
|
|
Net investment loss
|
|
|
(0.04
|
)
|
|
|
(0.11
|
)
|
|
|
(0.02
|
)
|
Net realized and unrealized gain (loss) on investments
|
|
|
(0.03
|
)
|
|
|
2.49
|
|
|
|
0.87
|
|
Increase from payments by affiliate
|
|
|
|
|
|
|
0.01
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total from investment operations
|
|
|
(0.07
|
)
|
|
|
2.39
|
|
|
|
0.85
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Offering costs
|
|
|
|
|
|
|
(0.00
|
)
(c)
|
|
|
(0.04
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Less distributions to Stockholders:
|
|
|
|
|
|
|
|
|
|
|
|
|
Net investment income
|
|
|
(0.93
|
)
|
|
|
(1.13
|
)
|
|
|
|
|
Tax return of capital
|
|
|
|
|
|
|
(0.72
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total distributions to Stockholders
|
|
|
(0.93
|
)
|
|
|
(1.85
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net asset value, end of period
|
|
|
$19.45
|
|
|
|
$20.45
|
|
|
|
$19.91
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Market price, end of period
|
|
|
$19.00
|
|
|
|
$19.13
|
|
|
|
$20.00
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
return
|
|
|
|
|
|
|
|
|
|
|
|
|
Based upon net asset value
|
|
|
(0.38%
|
)
|
|
|
13.29%
|
(d)
|
|
|
4.24%
|
(e)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Based upon market price
|
|
|
4.03%
|
|
|
|
5.50%
|
|
|
|
0.00
|
(f)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ratios to
average net
assets
(g)
|
Total expenses
|
|
|
1.15%
|
(h)
|
|
|
1.21%
|
|
|
|
1.22%
|
(h)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net investment loss
|
|
|
(0.44%
|
)
(h)
|
|
|
(0.60%
|
)
|
|
|
(0.96%
|
)
(h)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Supplemental
data
|
Net assets, end of period (in thousands)
|
|
|
$294,919
|
|
|
|
$308,060
|
|
|
|
$284,875
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Portfolio turnover
|
|
|
42%
|
|
|
|
102%
|
|
|
|
8%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
See
accompanying Notes to Financial Highlights.
The accompanying
Notes to Financial Statements are an integral part of this
statement.
14 COLUMBIA
SELIGMAN PREMIUM TECHNOLOGY GROWTH FUND 2011
SEMIANNUAL REPORT
Notes
to Financial Highlights
|
|
|
(a)
|
|
For
the period from November 30, 2009 (when shares became
available) to December 31, 2009.
|
(b)
|
|
Net
asset value, beginning of period, of $19.10 reflects a deduction
of $0.90 per share sales charge from the initial offering price
of $20.00 per share.
|
(c)
|
|
Rounds to less than $0.01.
|
(d)
|
|
During the year ended December 31, 2010, the Fund received
a payment by an affiliate. Had the Fund not received this
payment, the total return would have been lower by 0.03%.
|
(e)
|
|
Since
inception total return for net asset value (NAV) is from the
opening of business on November 30, 2009, and includes the
4.50% initial sales load. The NAV price per share of the
Funds Common Stock at inception was $19.10.
|
(f)
|
|
Since
inception total return for market price is based on the initial
offering price on November 24, 2009, which was $20.00 per
share.
|
(g)
|
|
In
addition to the fees and expenses which the Fund bears directly,
the Fund indirectly bears a pro rata share of the fees and
expenses of the acquired funds in which it invests. Such
indirect expenses are not included in the reported expense
ratios.
|
(h)
|
|
Annualized.
|
The accompanying
Notes to Financial Statements are an integral part of this
statement.
COLUMBIA
SELIGMAN PREMIUM TECHNOLOGY GROWTH FUND 2011
SEMIANNUAL REPORT 15
Notes
to Financial Statements
June 30,
2011 (Unaudited)
Note 1.
Organization
Columbia Seligman Premium Technology Growth Fund, Inc. (the
Fund) is a non-diversified fund. The Fund is registered under
the Investment Company Act of 1940, as amended (the 1940 Act),
as a closed-end management investment company.
The Fund was incorporated under the laws of the State of
Maryland on September 3, 2009, and commenced investment
operations on November 30, 2009. The Fund had no investment
operations prior to November 30, 2009 other than those
relating to organizational matters and the sale to Columbia
Management Investment Advisers, LLC (the Investment Manager), a
wholly-owned subsidiary of Ameriprise Financial, Inc.
(Ameriprise Financial), of 5,250 common shares (Common Stock) at
a cost of $100,275 on October 14, 2009. As of
December 31, 2009, the Fund issued 14,300,000 shares
of Common Stock, including 13,100,000 shares of Common
Stock in its initial public offering and 1,200,000 shares
of Common Stock purchased by the Funds underwriters
pursuant to an over-allotment option granted to the underwriters
in connection with the initial public offering. On
January 13, 2010, the Funds underwriters purchased an
additional 545,000 shares of Common Stock pursuant to the
overallotment option, resulting in a total of
14,845,000 shares of Common Stock issued by the Fund in its
initial public offering, including shares purchased by the
underwriters pursuant to the over-allotment option. With this
closing of this additional purchase of Common Stock, the
Funds total
raise-up
in
its initial public offering was an aggregate of
$296.9 million. The Fund has one billion authorized shares
of Common Stock. The issued and outstanding Common Stock trades
on the New York Stock Exchange (NYSE) under the symbol
STK.
The Fund currently has outstanding Common Stock. Each
outstanding share of Common Stock entitles the holder thereof to
one vote on all matters submitted to a vote of the Common
Stockholders, including the election of directors. Because the
Fund has no other classes or series of stock outstanding, Common
Stock possesses exclusive voting power. All of the Funds
shares of Common Stock have equal dividend, liquidation, voting
and other rights. The Funds Common Stockholders have no
preference, conversion, redemption, exchange, sinking fund, or
appraisal rights and have no preemptive rights to subscribe for
any of the Funds securities.
Although the Fund has no current intention to do so, the Fund is
authorized and reserves the flexibility to use leverage to
increase its investments or for other management activities
through the issuance of preferred shares (Preferred Stock)
and/or
borrowings. The costs of issuing Preferred Stock
and/or
a
borrowing
16 COLUMBIA
SELIGMAN PREMIUM TECHNOLOGY GROWTH FUND 2011
SEMIANNUAL REPORT
program would be borne by holders of Common Stock (Common
Stockholders) and consequently would result in a reduction of
net asset value of Common Stock.
The Funds investment objectives are to seek growth of
capital and current income. Under normal market conditions, the
Funds investment program will consist primarily of
(i) investing in a portfolio of equity securities of
technology and technology-related companies that seeks to exceed
the total return, before fees and expenses, of the S&P
North American Technology Sector Index and (ii) writing
call options on the NASDAQ 100 Index, an unmanaged index that
includes the largest and most active non-financial domestic and
international companies listed on the Nasdaq Stock Market, or
its exchange-traded fund equivalent (the NASDAQ 100) on a
month-to-month
basis, with an aggregate notional amount ranging from 0% to 90%
of the underlying value of the Funds holdings of Common
Stock. The Fund expects to generate current income from premiums
received from writing call options on the NASDAQ 100. The Fund
may also buy or write other call and put options on securities,
indices, ETFs and market baskets of securities to generate
additional income or return or to provide the portfolio with
downside protection as further described below in Note 2 to
the financial statements Derivative Instruments.
Note 2.
Summary of Significant Accounting Policies
Use
of Estimates
The preparation of financial statements in accordance with U.S.
generally accepted accounting principles (GAAP) requires
management to make certain estimates and assumptions that affect
the reported amounts of assets and liabilities, the disclosure
of contingent assets and liabilities at the date of the
financial statements and the reported amounts of revenue and
expenses during the reporting period. Actual results could
differ from those estimates.
The following is a summary of significant accounting policies
consistently followed by the Fund in the preparation of its
financial statements.
Security
Valuation
All securities are valued at the close of business of the NYSE.
Equity securities are valued at the last quoted sales price on
the principal exchange or market on which they trade, except for
securities traded on the NASDAQ Stock Market, which are valued
at the NASDAQ official close price. Unlisted securities or
listed securities for which there were no sales during the day
are valued at the mean of the latest quoted bid and asked prices
on such exchanges or markets.
COLUMBIA
SELIGMAN PREMIUM TECHNOLOGY GROWTH FUND 2011
SEMIANNUAL REPORT 17
Notes
to Financial Statements
(continued)
Debt securities generally are valued by pricing services
approved by the Board of Directors (the Board) based upon market
transactions for normal, institutional-size trading units of
similar securities. The services may use various pricing
techniques which take into account appropriate factors such as
yield, quality, coupon rate, maturity, type of issue, trading
characteristics and other data, as well as broker quotes. Debt
securities for which quotations are readily available may also
be valued based upon an over-the-counter or exchange bid
quotation.
Foreign securities are valued based on quotations from the
principal market in which such securities are normally traded.
If any foreign share prices are not readily available as a
result of limited share activity the securities are valued at
the mean of the latest quoted bid and asked prices on such
exchanges or markets. Foreign currency exchange rates are
generally determined at 4:00 p.m. Eastern (U.S.) time.
However, many securities markets and exchanges outside the U.S.
close prior to the close of the NYSE; therefore, the closing
prices for securities in such markets or on such exchanges may
not fully reflect events that occur after such close but before
the close of the NYSE. In those situations, foreign securities
will be fair valued pursuant to the policy adopted by the Board,
including utilizing a third party pricing service to determine
these fair values. The third party pricing service takes into
account multiple factors, including, but not limited to,
movements in the U.S. securities markets, certain depositary
receipts, futures contracts and foreign exchange rates that have
occurred subsequent to the close of the foreign exchange, to
determine a good faith estimate that reasonably reflects the
current market conditions as of the close of the NYSE. The fair
value of a security is likely to be different from the quoted or
published price, if available.
Option contracts are valued at the mean of the latest quoted bid
and asked prices on their primary exchanges. Option contracts,
including over-the-counter option contracts, with no readily
available market value are valued using quotations obtained from
independent brokers as of the close of the NYSE.
Investments in open-end investment companies, including money
market funds, are valued at net asset value.
Short-term securities purchased within 60 days to maturity
are valued at amortized cost, which approximates market value.
The value of short-term securities originally purchased with
maturities greater than 60 days is determined based on an
amortized value to par upon reaching 60 days to maturity.
Short-term securities maturing in more than 60 days from
the valuation date are valued at the market price or approximate
market value based on current interest rates.
18 COLUMBIA
SELIGMAN PREMIUM TECHNOLOGY GROWTH FUND 2011
SEMIANNUAL REPORT
Forward foreign currency exchange contracts are
marked-to-market
based upon foreign currency exchange rates provided by a pricing
service.
Investments for which market quotations are not readily
available, or that have quotations which management believes are
not reliable, are valued at fair value as determined in good
faith under consistently applied procedures established by and
under the general supervision of the Board. If a security or
class of securities (such as foreign securities) is valued at
fair value, such value is likely to be different from the last
quoted market price for the security. The determination of fair
value often requires significant judgment. To determine fair
value, management may use assumptions including but not limited
to future cash flows and estimated risk premiums. Multiple
inputs from various sources may be used to determine value.
Foreign
Currency Transactions and Translation
The values of all assets and liabilities denominated in foreign
currencies are translated into U.S. dollars at that days
exchange rates. Net realized and unrealized gains (losses) on
foreign currency transactions and translations include gains
(losses) arising from the fluctuation in exchange rates between
trade and settlement dates on securities transactions, gains
(losses) arising from the disposition of foreign currency and
currency gains (losses) between the accrual and payment dates on
dividends, interest income and foreign withholding taxes.
For financial statement purposes, the Fund does not distinguish
that portion of gains (losses) on investments which is due to
changes in foreign exchange rates from that which is due to
changes in market prices of the investments. Such fluctuations
are included with the net realized and unrealized gains (losses)
on investments in the Statement of Operations.
Derivative
Instruments
The Fund may invest in certain derivative instruments, which are
transactions whose values depend on or are derived from (in
whole or in part) the value of one or more other assets, such as
securities, currencies, commodities or indices. The Fund uses a
rules-based call option writing strategy on the NASDAQ 100
Index
®
,
an unmanaged index that includes the largest and most active
non-financial domestic and international companies listed on the
Nasdaq Stock Market, or its exchange-traded fund equivalent
(NASDAQ 100) on a
month-to-month
basis, with an aggregate notional amount ranging from 0% to 90%
of the underlying value of the Funds holdings of common
stock (the Rules-based Option Strategy). In addition to the
Rules-based Option Strategy, the Fund may write additional calls
with aggregate notional amounts of up to 25% of the value of the
Funds holdings in common stocks (to a maximum of 90% when
aggregated with the call options written pursuant to the
Rules-based Option
COLUMBIA
SELIGMAN PREMIUM TECHNOLOGY GROWTH FUND 2011
SEMIANNUAL REPORT 19
Notes
to Financial Statements
(continued)
Strategy) when call premiums are attractive relative to the risk
of the price of the NASDAQ 100. The Fund may also close (or buy
back) a written call option if the Investment Manager believes
that a substantial amount of the premium (typically, 70% or
more) to be received by the Fund has been captured before
exercise, potentially reducing the call position to 0% of total
equity until additional calls are written.
The Fund may also seek to provide downside protection by
purchasing puts on the NASDAQ 100 when premiums on these options
are considered by the Investment Manager to be low and,
therefore, attractive relative to the downside protection
provided.
The Fund may also buy or write other call and put options on
securities, indices, ETFs and market baskets of securities to
generate additional income or return or to provide the portfolio
with downside protection. In this regard, options may include
writing in- or
out-of-the-money
put options or buying or selling options in connection with
closing out positions prior to expiration of any options.
However, the Fund does not intend to write naked
call options on individual stocks (i.e., selling a call option
on an individual security not owned by the Fund) other than in
connection with implementing the options strategies with respect
to the NASDAQ 100. The put and call options purchased, sold or
written by the Fund may be exchange-listed or
over-the-counter
(OTC).
Investments in derivative instruments may expose the Fund to
certain additional risks, including those detailed below.
Forward
Foreign Currency Exchange Contracts
Forward foreign currency exchange contracts are agreements
between two parties to buy and sell a currency at a set price on
a future date. These contracts are intended to be used to
minimize the exposure to foreign exchange rate fluctuations
during the period between the trade and settlement dates of the
contract. The Fund utilized forward foreign currency exchange
contracts in connection with the settlement of purchases and
sales of securities, to hedge the currency exposure associated
with some or all of the Funds securities.
The values of forward foreign currency exchange contracts
fluctuate with changes in foreign currency exchange rates. The
Fund will record a realized gain or loss when the forward
foreign currency exchange contract is closed.
The use of forward foreign currency exchange contracts does not
eliminate fluctuations in the prices of the Funds
portfolio securities. The risks of forward foreign currency
exchange contracts include movement in the values of the foreign
currencies relative to the U.S. dollar (or other foreign
currencies) and the possibility that counterparties will not
complete their contractual obligations,
20 COLUMBIA
SELIGMAN PREMIUM TECHNOLOGY GROWTH FUND 2011
SEMIANNUAL REPORT
which may be in excess of the amount reflected, if any, in the
Statement of Assets and Liabilities.
Options
Options are contracts which entitle the holder to purchase or
sell securities or other identified assets at a specified price,
or in the case of index option contracts, to receive or pay the
difference between the index value and the strike price of the
index option contract. The Fund purchased and wrote option
contracts to decrease the Funds exposure to equity risk
and to increase return on investments. Completion of
transactions for option contracts traded in the OTC market
depends upon the performance of the other party. Cash collateral
may be collected or posted by the Fund to secure certain OTC
option contract trades. Cash collateral held or posted by the
Fund for such option contract trades must be returned to the
counterparty or the Fund upon closure, exercise or expiration of
the contract.
Option contracts purchased are recorded as investments and
options contracts written are recorded as liabilities of the
Fund. The Fund will realize a gain or loss when the option
contract expires or is exercised. When option contracts on debt
securities or futures are exercised, the Fund will realize a
gain or loss. When other option contracts are exercised, the
proceeds on sales for a written call or purchased put option
contract, or the purchase cost for a written put or purchased
call option contract, is adjusted by the amount of premium
received or paid.
The risk in buying an option contract is that the Fund pays a
premium whether or not the option contract is exercised. The
Fund also has the additional risk of being unable to enter into
a closing transaction if a liquid secondary market does not
exist. The risk in writing a call option contract is that the
Fund gives up the opportunity for profit if the market price of
the security increases. The risk in writing a put option
contract is that the Fund may incur a loss if the market price
of the security decreases and the option contract is exercised.
The Funds maximum payout in the case of written put option
contracts represents the maximum potential amount of future
payments (undiscounted) that the Fund could be required to make
under the contract. For OTC options contracts, the transaction
is also subject to counterparty credit risk. The maximum payout
amount may be offset by the subsequent sale, if any, of assets
obtained upon the exercise of the put option contracts by
holders of the option contracts or proceeds received upon
entering into the contracts. The maximum payout amount was
$3,179,200 at June 30, 2011.
COLUMBIA
SELIGMAN PREMIUM TECHNOLOGY GROWTH FUND 2011
SEMIANNUAL REPORT 21
Notes
to Financial Statements
(continued)
Contracts and premiums associated with options contracts written
for the six months ended June 30, 2011 are as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Calls
|
|
|
Puts
|
|
|
|
Contracts
|
|
|
Premiums
|
|
|
Contracts
|
|
|
Premiums
|
|
Balance December 31, 2010
|
|
|
783
|
|
|
$
|
3,014,850
|
|
|
|
325
|
|
|
$
|
48,647
|
|
Opened
|
|
|
5,891
|
|
|
|
16,943,991
|
|
|
|
2,365
|
|
|
|
316,239
|
|
Closed
|
|
|
(4,709
|
)
|
|
|
(17,493,892
|
)
|
|
|
(1,401
|
)
|
|
|
(178,045
|
)
|
Expired
|
|
|
(292
|
)
|
|
|
(31,902
|
)
|
|
|
(169
|
)
|
|
|
(14,162
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance June 30, 2011
|
|
|
1,673
|
|
|
$
|
2,433,047
|
|
|
|
1,120
|
|
|
$
|
172,679
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Effects
of Derivative Transactions in the Financial Statements
The following tables are intended to provide additional
information about the effect of derivatives on the financial
statements of the Fund including: the fair value of derivatives
by risk category and the location of those fair values in the
Statement of Assets and Liabilities; the impact of derivative
transactions on the Funds operations over the period
including realized gains or losses and unrealized gains or
losses. The derivative schedules following the Portfolio of
Investments present additional information regarding derivative
instruments outstanding at the end of the period, if any.
Fair
Values of Derivative Instruments at June 30, 2011
|
|
|
|
|
|
|
|
|
|
|
|
|
Liability
Derivatives
|
|
|
|
|
|
Statement of
Assets
|
|
|
|
|
|
|
Risk
Exposure
|
|
and
Liabilities
|
|
|
|
|
|
|
Category
|
|
Location
|
|
|
Fair
Value
|
|
|
|
Equity contracts
|
|
|
Options contracts written, at value
|
|
|
$
|
7,059,252
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Effect
of Derivative Instruments in the Statement of Operations for the
Six Months Ended June 30, 2011
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Amount of
Realized Gain (Loss) on Derivatives Recognized in
Income
|
|
|
Forward
Foreign
|
|
|
|
|
|
|
|
|
|
|
|
Currency
Exchange
|
|
|
|
|
|
|
|
|
|
Risk
Exposure Category
|
|
Contracts
|
|
|
Option
Contracts
|
|
|
Total
|
|
|
|
Equity contracts
|
|
$
|
|
|
|
$
|
(4,258,690
|
)
|
|
$
|
(4,258,690
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Foreign exchange contracts
|
|
|
(7,895
|
)
|
|
|
|
|
|
$
|
(7,895
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
$
|
(7,895
|
)
|
|
$
|
(4,258,690
|
)
|
|
$
|
(4,266,585
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
22 COLUMBIA
SELIGMAN PREMIUM TECHNOLOGY GROWTH FUND 2011
SEMIANNUAL REPORT
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Change in
Unrealized Appreciation (Depreciation) on Derivatives Recognized
in Income
|
|
|
Forward
Foreign
|
|
|
|
|
|
|
|
|
|
|
|
Currency
Exchange
|
|
|
|
|
|
|
|
|
|
Risk
Exposure Category
|
|
Contracts
|
|
|
Option
Contracts
|
|
|
Total
|
|
|
|
Equity contracts
|
|
$
|
|
|
|
$
|
(5,311,691
|
)
|
|
$
|
(5,311,691
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Foreign exchange contracts
|
|
|
|
|
|
|
|
|
|
$
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
$
|
|
|
|
$
|
(5,311,691
|
)
|
|
$
|
(5,311,691
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Volume
of Derivative Instruments for the Six Months Ended June 30,
2011
|
|
|
|
|
|
|
|
|
Contracts
|
|
|
|
|
|
Opened
|
|
|
|
Forward Foreign Currency Exchange Contracts
|
|
|
12
|
|
|
|
|
|
|
|
|
|
|
Options Contracts
|
|
|
8,256
|
|
|
|
|
|
|
|
|
|
|
Security
Transactions
Security transactions are accounted for on the trade date. Cost
is determined and gains (losses) are based upon the specific
identification method for both financial statement and federal
income tax purposes.
Income
Recognition
Corporate actions and dividend income are recorded net of any
non-reclaimable tax withholdings, on the ex-dividend date or
upon receipt of ex-dividend notification in the case of certain
foreign securities.
Federal
Income Tax Status
The Fund intends to qualify each year as a regulated investment
company under Subchapter M of the Internal Revenue Code, as
amended, and will distribute substantially all of its taxable
income, if any, for its tax year, and as such will not be
subject to federal income taxes. In addition, the Fund intends
to distribute in each calendar year substantially all of its net
investment income, capital gains and certain other amounts, if
any, such that the Fund should not be subject to federal excise
tax. Therefore, no federal income or excise tax provision is
recorded.
Foreign
Taxes
The Fund may be subject to foreign taxes on income or currency
repatriation, a portion of which may be recoverable. The Fund
will accrue such taxes and recoveries, as applicable, based upon
its current interpretation of tax rules and regulations that
exist in the markets in which it invests.
COLUMBIA
SELIGMAN PREMIUM TECHNOLOGY GROWTH FUND 2011
SEMIANNUAL REPORT 23
Notes
to Financial Statements
(continued)
Realized gains in certain countries may be subject to foreign
taxes at the Fund level, at rates ranging from approximately 10%
to 15%. The Fund pays for such foreign taxes on net realized
gains at the appropriate rate for each jurisdiction.
Dividends
to Stockholders
In November 2010, the Fund paid its first dividend under
the Funds new, managed distribution policy adopted by the
Funds Board. 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 1940 Act, as amended, the Fund could not distribute
long-term capital gains, as defined in the Internal Revenue Code
of 1986, 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
distribute long-term capital gains more often than once in any
one taxable year. After consideration by the Funds Board,
the Fund adopted the current managed distribution policy which
allows the Fund to make periodic distributions of long-term
capital gains. Under its managed distribution policy, the Fund
intends to make quarterly distributions to Common Stockholders
at a rate that reflects the past and projected performance of
the Fund. 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 Funds 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 a portion of
an investors original investment. A return of capital is
not taxable, but it reduces a Stockholders 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 vary, and the Funds
distribution rate will depend on a number of factors, including
the net earnings on the Funds 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 described above. The net investment
income of the Fund consists of all income (other than net
short-term and long-term capital gains) less all expenses of the
Fund.
The Board may change the Funds distribution policy and the
amount or timing of the distributions, based on a number of
factors, including, but not limited to, as the Funds
portfolio and market conditions change, the amount of the
Funds 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.
Over time, the Fund will distribute all of its net investment
income
24 COLUMBIA
SELIGMAN PREMIUM TECHNOLOGY GROWTH FUND 2011
SEMIANNUAL REPORT
and net short-term capital gains. In addition, at least
annually, the Fund intends to distribute any net capital gain
(which is the excess of net long-term capital gain over net
short-term capital loss) or, alternatively, to retain all or a
portion of the years net capital gain and pay federal
income tax on the retained gain.
Dividends and other distributions to Stockholders are recorded
on ex-dividend dates.
Guarantees
and Indemnifications
Under the Funds organizational documents and, in some
cases, by contract, its officers and directors are indemnified
against certain liabilities arising out of the performance of
their duties to the Fund. In addition, certain of the
Funds contracts with its service providers contain general
indemnification clauses. The Funds maximum exposure under
these arrangements is unknown since the amount of any future
claims that may be made against the Fund cannot be determined,
and the Fund has no historical basis for predicting the
likelihood of any such claims.
Note 3. Fees
and Compensation Paid to Affiliates
Investment
Management Fees
Under an Investment Management Services Agreement (IMSA), the
Investment Manager determines which securities will be
purchased, held or sold. The management fee is an annual fee
that is equal to 1.00% of the Funds average daily Managed
Assets. Managed Assets means the net asset value of
the Funds outstanding Common Stock plus the liquidation
preference of any issued and outstanding Preferred Stock of the
Fund and the principal amount of any borrowings used for
leverage.
Administration
Fees
Under an Administrative Services Agreement, the Investment
Manager serves as the Fund Administrator. The Fund pays the
Fund Administrator an annual fee for administration and
accounting services equal to 0.06% of the Funds average
daily Managed Assets.
Other
Fees
Other expenses are for, among other things, certain expenses of
the Fund or the Board including: Fund boardroom and office
expense, employee compensation, employee health and retirement
benefits, and certain other expenses. Payment of these Fund and
Board expenses is facilitated by a company providing limited
administrative services to the Fund and the Board. For the six
months ended June 30, 2011, there were no expenses incurred
for these particular items.
COLUMBIA
SELIGMAN PREMIUM TECHNOLOGY GROWTH FUND 2011
SEMIANNUAL REPORT 25
Notes
to Financial Statements
(continued)
Compensation
of Board Members
Under a Deferred Compensation Plan (the Plan), the board members
who are not interested persons of the Fund as
defined under the 1940 Act may defer receipt of their
compensation. Deferred amounts are treated as though equivalent
dollar amounts had been invested in shares of the Fund or
certain other funds managed by the Investment Manager. The
Funds liability for these amounts is adjusted for market
value changes and remains in the Fund until distributed in
accordance with the Plan.
Organization
Expenses and Offering Costs
The Investment Manager paid all organization expenses of the
Fund. With respect to the Funds initial public offering,
the Investment Manager paid all offering costs (other than sales
load) that exceeded $0.04 per share of Common Stock. The Fund
paid offering costs of $21,800 from the proceeds of the initial
public offering costs for the period ended December 31,
2010. Offering costs paid by the Fund were charged as a
reduction of paid-in capital at the completion of the Fund
offering.
Note 4.
Federal Tax Information
The timing and character of income and capital gain
distributions are determined in accordance with income tax
regulations, which may differ from GAAP. Reclassifications are
made to the Funds capital accounts for permanent tax
differences to reflect income and gains available for
distribution (or available capital loss carryforwards) under
income tax regulations.
At June 30, 2011, the cost of investments for federal
income tax purposes was approximately $277,406,000 and the
approximate unrealized appreciation and depreciation based on
that cost was:
|
|
|
|
|
Unrealized appreciation
|
|
$
|
35,648,000
|
|
Unrealized depreciation
|
|
|
(8,860,000
|
)
|
|
|
|
|
|
Net unrealized appreciation
|
|
$
|
26,788,000
|
|
|
|
|
|
|
Management of the Fund has concluded that there are no
significant uncertain tax positions that would require
recognition in the financial statements. However,
managements conclusion may be subject to review and
adjustment at a later date based on factors including, but not
limited to, new tax laws, regulations, and administrative
interpretations (including relevant court decisions). Generally,
the Funds federal tax returns for the prior three fiscal
years remain subject to examination by the Internal Revenue
Service.
26 COLUMBIA
SELIGMAN PREMIUM TECHNOLOGY GROWTH FUND 2011
SEMIANNUAL REPORT
Note 5.
Portfolio Information
The cost of purchases and proceeds from sales of securities,
excluding short-term obligations, aggregated to $128,066,443 and
$141,046,175, respectively, for the six months ended
June 30, 2011.
Note 6.
Dividend Investment Plan and Stock Repurchase Program
The Fund, in connection with its Dividend Investment Plan (the
Plan), issues shares of its own Common Stock, as needed, to
satisfy Plan requirements. A total of 93,163 shares were
issued to Plan participants during the six months ended
June 30, 2011 for proceeds of $1,841,745, a weighted
average discount of 2.37% from the net asset value of those
shares.
Pursuant to the Plan, unless a Common Stockholder elects
otherwise, all cash dividends, capital gains distributions, and
other distributions are automatically reinvested in additional
Common Stock. If you hold your shares in street name or other
nominee (i.e., through a broker), you should contact them to
determine their policy, as the broker firms policy with
respect to Fund distributions may be to default to a cash
payment. Common Stockholders who elect not to participate in the
Plan (including those whose intermediaries do not permit
participation in the Plan by their customers) will receive all
dividends and distributions payable in cash directly to the
Common Stockholder of record (or, if the shares of Common Stock
are held in street or other nominee name, then to such nominee).
Common Stockholders may elect not to participate in the Plan and
to receive all distributions of dividends and capital gains or
other distributions in cash by sending written instructions to
American Stock Transfer & Trust Company, LLC
(AST), 59 Maiden Lane Plaza Level, New York, New York 10038.
Participation in the Plan may be terminated or resumed at any
time without penalty by written notice if received by AST, prior
to the record date for the next distribution. Otherwise, such
termination or resumption will be effective with respect to any
subsequently declared distribution.
Under the Plan, Common Stockholders receive shares of Common
Stock in lieu of cash distributions unless they have elected
otherwise as described above. Common Stock will be issued in
lieu of cash by the Fund from previously authorized but unissued
Common Stock. If the market price of a share on the
ex-dividend
date of such a distribution is at or above the Funds net
asset value per share on such date, the number of shares to be
issued by the Fund to each Common Stockholder receiving shares
in lieu of cash distributions will be determined by dividing the
amount of the cash distribution to which such Common Stockholder
would be entitled by the greater of the net asset value per
share on such date or 95% of the market price of a share on such
date. If the
COLUMBIA
SELIGMAN PREMIUM TECHNOLOGY GROWTH FUND 2011
SEMIANNUAL REPORT 27
Notes
to Financial Statements
(continued)
market price of a share on such an ex-dividend date is below the
net asset value per share, the number of shares to be issued to
such Common Stockholders will be determined by dividing such
amount by the per share market price. The issuance of Common
Stock at less than net asset value per share will dilute the net
asset value of all Common Stock outstanding at that time. Market
price on any day means the closing price for the Common Stock at
the close of regular trading on the NYSE on such day or, if such
day is not a day on which the Common Stock trades, the closing
price for the Common Stock at the close of regular trading on
the immediately preceding day on which trading occurs.
The Fund, under its stock repurchase program, currently intends
to make open market purchases of its Common Stock from time to
time when the Funds Common Stock is trading at a discount
to its net asset value, in an amount approximately sufficient to
offset the growth in the number of shares of Common Stock issued
as a result of the reinvestment of the portion of its
distributions to Common Stockholders that are attributable to
distributions received by the Fund from its underlying portfolio
investments less fund expenses. No shares were purchased in the
open market during the six months ended June 30, 2011.
The Fund reserves the right to amend or terminate the Plan as
applied to any distribution paid subsequent to written notice of
the change sent to participants in the Plan at least
90 days before the record date for such distribution. There
are no service or brokerage charges to participants in the Plan;
however, the Fund reserves the right to amend the Plan to
include a service charge payable to the Fund by the
participants. The Fund reserves the right to amend the Plan to
provide for payment of brokerage fees by Plan participants in
the event the Plan is changed to provide for open market
purchases of Common Stock on behalf of Plan participants. All
correspondence concerning the Plan should be directed to AST.
Note 7.
Affiliated Money Market Fund
The Fund may invest its daily cash balances in Columbia
Short-Term Cash Fund, a money market fund established for the
exclusive use by the Fund and other affiliated Funds. The income
earned by the Fund from such investments is included as
Dividends from affiliates in the Statement of
Operations. As an investing fund, the Fund indirectly bears its
proportionate share of the expenses of Columbia Short-Term Cash
Fund.
28 COLUMBIA
SELIGMAN PREMIUM TECHNOLOGY GROWTH FUND 2011
SEMIANNUAL REPORT
Note 8.
Significant Risks
Non-Diversification
Risk
The Fund is a non-diversified fund. A non-diversified fund is
permitted to invest a greater percentage of its total assets in
fewer companies than a diversified fund. The Fund may,
therefore, have a greater risk of loss from a few issuers than a
similar fund that invests more broadly.
Technology
and Technology-related Investment Risk
The Fund invests a substantial portion of its assets in
technology and technology-related companies. 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. In addition, a rising interest
rate environment tends to negatively affect technology and
technology-related companies. In such an environment, those
companies with high market valuations may appear less attractive
to investors, which may cause sharp decreases in the
companies market prices. Further, those technology or
technology-related companies seeking to finance their expansion
would have increased borrowing costs, which may negatively
impact their earnings. As a result, these factors may negatively
affect the performance of the Fund. Finally, the Fund may be
susceptible to factors affecting the technology and
technology-related industries, and the Funds net asset
value may fluctuate more than a fund that invests in a wider
range of industries. 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.
Writing
Call Options Risk
A principal aspect of the Funds investment strategy
involves writing call options on the NASDAQ 100. This part of
the Funds strategy subjects the Fund to certain additional
risks. A decision as to whether, when and how to use options
involves the exercise of skill and judgment, and even a
well-conceived transaction may be unsuccessful to some degree
because of market behavior or unexpected events. The principal
factors affecting the market value of an option include supply
and demand, interest rates, the current market price of the
underlying index or security in relation to the exercise price
of the option, the
COLUMBIA
SELIGMAN PREMIUM TECHNOLOGY GROWTH FUND 2011
SEMIANNUAL REPORT 29
Notes
to Financial Statements
(continued)
actual or perceived volatility of the underlying index or
security and the time remaining until the expiration date.
The Fund intends to write call options on the NASDAQ 100;
however, it does not intend to have a portfolio of securities
that mirrors the securities in the NASDAQ 100. As a result,
during a period when the Fund has outstanding call options
written on the NASDAQ 100, the NASDAQ 100 may appreciate to a
greater extent than the securities in the Funds portfolio.
If the call options are exercised in these circumstances, the
Funds loss on the options will be greater because it will
be paying the option holder not only an amount effectively
representing appreciation on securities in its own portfolio but
also an amount representing the greater appreciation experienced
by the securities in the NASDAQ 100 that the Fund does not own.
If, at a time these call options may be exercised, the
securities underlying these options have market values above the
exercise price, then these call options will be exercised and
the Fund will be obligated to deliver to the option holder
either the securities underlying these options or to deliver the
cash value of those securities, in exchange for which the option
holder will pay the Fund the exercise price. In either case, the
Fund will incur losses to the extent the market value of the
underlying securities exceed the sum of the premium the Fund
received from writing the call options and the exercise price of
the call options, which loss may be very substantial.
To the extent all or part of the Funds call options are
covered, the Fund forgoes, during the options life, the
opportunity to profit from increases in the market value of the
security underlying the call option above the sum of the option
premium received and the exercise price of the call, but has
retained the risk of loss should the price of the underlying
security decline below the exercise price minus the option
premium received. The writer of an exchange-listed option on a
security has no control over when during the exercise period of
the option (which may be a single day or multiple days) it may
be required to fulfill its obligation as a writer of the option.
Once an option writer has received an exercise notice, it would
be obligated to deliver the underlying security at the exercise
price. Thus, the writing of call options may require the Fund to
sell portfolio securities at inopportune times or for prices
other than current market values and will limit the amount of
appreciation the Fund can realize above the exercise price of an
option.
The Fund may be required to sell investments from its portfolio
to effect cash settlement (or transfer ownership of a stock or
other instrument to physically settle) on any written call
options that are exercised. Such sales (or transfers) may occur
at inopportune times, and the Fund may incur transaction costs
that increase the expenses borne by Common Stockholders. The
Fund may sell
30 COLUMBIA
SELIGMAN PREMIUM TECHNOLOGY GROWTH FUND 2011
SEMIANNUAL REPORT
written call options over an exchange or in the OTC market. The
options in the OTC markets may not be as liquid as
exchange-listed options. The Fund may be limited in the number
of counterparties willing to take positions opposite the Fund or
may find the terms of such counterparties to be less favorable
than the terms available for listed options. The Fund cannot
guarantee that its options strategies will be effective.
Moreover, OTC options may provide less favorable tax treatment
than listed options.
The value of options may be adversely affected if the market for
such options becomes less liquid or smaller. There can be no
assurance that a liquid market will exist when the Fund seeks to
close out an option position, in the case of a call option
written, by buying the option back. Reasons for the absence of a
liquid secondary market on an exchange include the following:
(i) there may be insufficient trading interest in certain
options; (ii) restrictions may be imposed by an exchange on
opening transactions or closing transactions or both;
(iii) trading halts, suspensions or other restrictions may
be imposed with respect to particular classes or series of
options; (iv) unusual or unforeseen circumstances may
interrupt normal operations on an exchange; (v) the
facilities of an exchange or the Options Clearing Corporation
(OCC) may not at all times be adequate to handle current trading
volume; or (vi) one or more exchanges could, for economic
or other reasons, decide or be compelled to discontinue the
trading of options (or a particular class or series of options)
at some future date. If trading were discontinued, the secondary
market on that exchange (or in that class or series of options)
would cease to exist. However, outstanding options on that
exchange that had been issued by the OCC as a result of trades
on that exchange would continue to be exercisable in accordance
with their terms. The Funds ability to terminate OTC
options will be more limited than with exchange-traded options
and may involve the risk that broker-dealers participating in
such transactions will not fulfill their obligations.
The hours of trading for options may not conform to the hours
during which the underlying securities are traded. To the extent
that the options markets close before the markets for the
underlying securities, significant price and rate movements can
take place in the underlying markets that would not be reflected
concurrently in the options markets. Call options are marked to
market daily and their value will be affected by changes in the
value of and dividend rates of the underlying common stocks,
changes in interest rates, changes in the actual or perceived
volatility of the stock market and the underlying common stocks
and the remaining time to the options expiration.
Additionally, the exercise price of an option may be adjusted
downward before the options expiration as a result of the
occurrence of certain corporate events affecting the underlying
equity security, such as extraordinary dividends, stock splits,
merger or other
COLUMBIA
SELIGMAN PREMIUM TECHNOLOGY GROWTH FUND 2011
SEMIANNUAL REPORT 31
Notes
to Financial Statements
(continued)
extraordinary distributions or events. A reduction in the
exercise price of an option would reduce the Funds capital
appreciation potential on the underlying security.
The Funds options transactions will be subject to
limitations established by each of the exchanges, boards of
trade or other trading facilities on which such options are
traded. These limitations govern the maximum number of options
in each class which may be written or purchased by a single
investor or group of investors acting in concert, regardless of
whether the options are written or purchased on the same or
different exchanges, boards of trade or other trading facilities
or are held or written in one or more accounts or through one or
more brokers. Thus, the number of options which the Fund may
write or purchase may be affected by options written or
purchased by other investment advisory clients of the Investment
Manager. An exchange, board of trade or other trading facility
may order the liquidation of positions found to be in excess of
these limits, and may impose certain other sanctions.
Options
Risk
The Fund engages in transactions in options on securities,
indices, exchange traded funds and market baskets of securities
on exchanges and in the OTC markets. In general, exchange-traded
options have standardized exercise prices and expiration dates
and require the parties to post margin against their
obligations, and the performance of the parties
obligations in connection with such options is guaranteed by the
exchange or a related clearing corporation. OTC options have
more flexible terms negotiated between the buyer and the seller,
but generally do not require the parties to post margin and are
subject to greater credit risk. OTC options also involve greater
liquidity risk.
In addition to writing call options as described above, the Fund
may purchase put options. By buying a put option, the Fund will
pay a premium to acquire a right to sell the securities or
instruments underlying the put at the exercise price of the
option. The Fund will lose money if the securities or
instruments underlying the option do not decline in value below
the exercise price of the option by an amount sufficient to
offset the premium paid to acquire the option. To the extent the
Fund purchases put options in the OTC market, the Fund will be
subject to the credit risk of the seller of the option. The Fund
also may write put options on the types of securities or
instruments that may be held by the Fund, provided that such put
options are secured by segregated, liquid instruments. The Fund
will receive a premium for writing a put option, which increases
the Funds return. In exchange for the premium received,
the Fund has the obligation to buy the securities or instruments
underlying the option at an
agreed-upon
exercise price if the securities or instruments decrease below
the exercise price of the option. The
32 COLUMBIA
SELIGMAN PREMIUM TECHNOLOGY GROWTH FUND 2011
SEMIANNUAL REPORT
Fund will lose money if the securities or instruments decrease
in value so that the amount the Fund is obligated to pay the
counterparty to the option to purchase the securities underlying
the option upon exercise of the option exceeds the value of
those securities by an amount that is greater than the premium
received by the Fund for writing the option.
The Fund may purchase call options on any of the types of
securities or instruments in which it may invest. In exchange
for paying the option premium, a purchased call option gives the
Fund the right to buy, and obligates the seller to sell, the
underlying security or instrument at the exercise price. The
Fund will lose money if the securities or instruments underlying
the option do not appreciate in value in an amount sufficient to
offset the premium paid by the Fund to acquire the option.
Small
and Mid-cap Companies Risk
The Fund may invest all or a substantial portion of its assets
in companies whose market capitalization is considered small- or
mid-cap. These companies often are newer or less established
companies than larger companies. Investments in these companies
carry additional risks because earnings of these companies tend
to be less predictable; they often have limited product lines,
markets, distribution channels or financial resources; and the
management of such companies may be dependent upon one or a few
key people. The market movements of equity securities of
small-cap and mid-cap companies may be more abrupt or erratic
than the market movements of equity securities of larger, more
established companies or the stock market in general.
Historically, small-cap and mid-cap companies have sometimes
gone through extended periods when they did not perform as well
as larger companies. In addition, equity securities of these
companies generally are less liquid than those of larger
companies. This means that the Fund could have greater
difficulty selling such securities at the time and price that
the Fund would like. Smaller-company stocks, as a whole, may
experience larger price fluctuations than large-company stocks
or other types of investments. During periods of investor
uncertainty, investor sentiment may favor large, well-known
companies over small, lesser-known companies. There may be less
trading in a smaller companys stock, which means that buy
and sell transactions in that stock could have a larger impact
on the stocks price than is the case with larger company
stocks.
Foreign
Securities Risk
The Fund may invest up to 25% of its Managed Assets in
securities of companies organized outside the United States.
Investments in foreign securities involve certain risks not
associated with investments in U.S. companies. Securities
markets in certain foreign countries are not as developed,
efficient or liquid as
COLUMBIA
SELIGMAN PREMIUM TECHNOLOGY GROWTH FUND 2011
SEMIANNUAL REPORT 33
Notes
to Financial Statements
(continued)
securities markets in the United States. Therefore, the prices
of foreign securities are often volatile and trading costs are
higher. Certain foreign countries may impose restrictions on the
ability of issuers of foreign securities to make payments of
principal and interest to investors located outside the country,
due to blockage of foreign currency exchanges or otherwise.
Generally, there is less publicly available information about
foreign companies due to less rigorous disclosure or accounting
standards and regulatory practices. In addition, the Fund will
be subject to risks associated with adverse political and
economic developments in foreign countries, which could cause
the Fund to lose money on its investments in foreign securities.
The Fund may invest in securities of issuers located or doing
substantial business in emerging markets (lesser
developed countries). Because of the less developed markets and
economics and, in some countries, less mature governments and
governmental institutions, the risks of investing in foreign
securities can be intensified in the case of investments in
issuers domiciled or doing substantial business in emerging
markets. These risks include a high concentration of market
capitalization and trading volume in a small number of issuers
representing a limited number of industries, as well as a high
concentration of investors and financial intermediaries;
political and social uncertainties; over-dependence on exports,
especially with respect to primary commodities, making these
economies vulnerable to changes in commodity prices;
overburdened infrastructure and obsolete or unseasoned financial
systems; environmental problems; less developed legal systems;
and less reliable custodial services and settlement practices.
Note 9.
Subsequent Events
Management has evaluated the events and transactions that have
occurred through the date the financial statements were issued
and noted no items requiring adjustment of the financial
statements or additional disclosure.
Note 10.
Information Regarding Pending and Settled Legal
Proceedings
In June 2004, an action captioned
John E. Gallus et al.
v. American Express Financial Corp. and American Express
Financial Advisors Inc.
was filed in the United States
District Court for the District of Arizona. The plaintiffs
allege that they are investors in several American Express
Company mutual funds (branded as Columbia or RiverSource) and
they purport to bring the action derivatively on behalf of those
funds under the Investment Company Act of 1940. The plaintiffs
allege that fees allegedly paid to the defendants by the funds
for investment advisory and administrative services are
excessive. The plaintiffs seek remedies including restitution
and rescission of investment advisory and distribution
34 COLUMBIA
SELIGMAN PREMIUM TECHNOLOGY GROWTH FUND 2011
SEMIANNUAL REPORT
agreements. The plaintiffs voluntarily agreed to transfer this
case to the United States District Court for the District of
Minnesota (the District Court). In response to defendants
motion to dismiss the complaint, the District Court dismissed
one of plaintiffs four claims and granted plaintiffs
limited discovery. Defendants moved for summary judgment in
April 2007. Summary judgment was granted in the
defendants favor on July 9, 2007. The plaintiffs
filed a notice of appeal with the Eighth Circuit Court of
Appeals (the Eighth Circuit) on August 8, 2007. On
April 8, 2009, the Eighth Circuit reversed summary judgment
and remanded to the District Court for further proceedings. On
August 6, 2009, defendants filed a writ of certiorari with
the U.S. Supreme Court (the Supreme Court), asking the Supreme
Court to stay the District Court proceedings while the Supreme
Court considers and rules in a case captioned
Jones v. Harris
Associates,
which involves issues of law similar to those
presented in the Gallus case. On March 30, 2010, the
Supreme Court issued its ruling in
Jones v. Harris
Associates,
and on April 5, 2010, the Supreme Court
vacated the Eighth Circuits decision in the Gallus case
and remanded the case to the Eighth Circuit for further
consideration in light of the Supreme Courts decision in
Jones v. Harris Associates
. On June 4, 2010, the
Eighth Circuit remanded the Gallus case to the District Court
for further consideration in light of the Supreme Courts
decision in
Jones v. Harris Associates
. On
December 9, 2010, the District Court reinstated its
July 9, 2007 summary judgment order in favor of the
defendants. On January 10, 2011, plaintiffs filed a notice
of appeal with the Eighth Circuit. In response to the
plaintiffs opening appellate brief filed on March 18,
2011, the defendants filed a response brief on May 4, 2011
with the Eighth Circuit. The plaintiffs filed a reply brief on
May 26, 2011.
In December 2005, without admitting or denying the
allegations, American Express Financial Corporation (AEFC, which
is now known as Ameriprise Financial, Inc. (Ameriprise
Financial)), entered into settlement agreements with the
Securities and Exchange Commission (SEC) and Minnesota
Department of Commerce (MDOC) related to market timing
activities. As a result, AEFC was censured and ordered to cease
and desist from committing or causing any violations of certain
provisions of the Investment Advisers Act of 1940, the
Investment Company Act of 1940, and various Minnesota laws. AEFC
agreed to pay disgorgement of $10 million and civil money
penalties of $7 million. AEFC also agreed to retain an
independent distribution consultant to assist in developing a
plan for distribution of all disgorgement and civil penalties
ordered by the SEC in accordance with various undertakings
detailed at www.sec.gov/litigation/admin/ia-2451.pdf. Ameriprise
Financial and its affiliates have cooperated with the SEC and
the MDOC in these legal proceedings, and have made regular
reports to the funds Boards of Directors/Trustees.
COLUMBIA
SELIGMAN PREMIUM TECHNOLOGY GROWTH FUND 2011
SEMIANNUAL REPORT 35
Notes
to Financial Statements
(continued)
Ameriprise Financial and certain of its affiliates have
historically been involved in a number of legal, arbitration and
regulatory proceedings, including routine litigation, class
actions, and governmental actions, concerning matters arising in
connection with the conduct of their business activities.
Ameriprise Financial believes that the Funds are not currently
the subject of, and that neither Ameriprise Financial nor any of
its affiliates are the subject of, any pending legal,
arbitration or regulatory proceedings that are likely to have a
material adverse effect on the Funds or the ability of
Ameriprise Financial or its affiliates to perform under their
contracts with the Funds. Ameriprise Financial is required to
make
10-Q,
10-K
and, as
necessary,
8-K
filings
with the Securities and Exchange Commission on legal and
regulatory matters that relate to Ameriprise Financial and its
affiliates. Copies of these filings may be obtained by accessing
the SEC website at www.sec.gov.
There can be no assurance that these matters, or the adverse
publicity associated with them, will not result in increased
fund redemptions, reduced sale of fund shares or other adverse
consequences to the Funds. Further, although we believe
proceedings are not likely to have a material adverse effect on
the Funds or the ability of Ameriprise Financial or its
affiliates to perform under their contracts with the Funds,
these proceedings are subject to uncertainties and, as such, we
are unable to estimate the possible loss or range of loss that
may result. An adverse outcome in one or more of these
proceedings could result in adverse judgments, settlements,
fines, penalties or other relief that could have a material
adverse effect on the consolidated financial condition or
results of operations of Ameriprise Financial.
36 COLUMBIA
SELIGMAN PREMIUM TECHNOLOGY GROWTH FUND 2011
SEMIANNUAL REPORT
The policy of the Board is to vote the proxies of the companies
in which the Fund holds investments consistent with the
procedures that can be found by visiting columbiamanagement.com.
Information regarding how the Fund voted proxies relating to
portfolio securities is filed with the SEC by August 31 for
the most recent
12-month
period ending June 30 of that year, and is available
without charge by visiting columbiamanagement.com; or searching
the website of the SEC at www.sec.gov.
Approval
of Investment Management Services
Columbia Management Investment Advisers, LLC (Columbia
Management or the investment manager), a
wholly-owned subsidiary of Ameriprise Financial, Inc.
(Ameriprise Financial), serves as the investment
manager to Columbia Seligman Premium Technology Growth Fund,
Inc. (the Fund). Under an investment management
services agreement (the IMS Agreement), Columbia
Management provides investment advice and other services to the
Fund and all funds distributed by Columbia Management Investment
Distributors, Inc. (collectively, the Funds).
On an annual basis, the Funds Board of Directors (the
Board), including the independent Board members (the
Independent Directors), considers renewal of the IMS
Agreement. Columbia Management prepared detailed reports for the
Board and its Contracts Committee in March and April 2011,
including reports based on analyses of data provided by
independent organizations and a comprehensive response to each
item of information requested by independent legal counsel to
the Independent Directors (Independent Legal
Counsel) in a letter to the investment manager, to assist
the Board in making this determination. All of the materials
presented in March and April were first supplied in draft form
to designated representatives of the Independent Directors,
i.e.
, Independent Legal Counsel, the Boards Chair
and the Chair of the Contracts Committee, and the final
materials were revised to reflect comments provided by these
Board representatives. In addition, throughout the year, the
Board (or its committees) regularly meets with portfolio
management teams and reviews information prepared by Columbia
Management addressing the services Columbia Management provides
and Fund performance. The Board accords particular weight to the
work, deliberations and conclusions of the Contracts Committee,
the Investment Review Committee and the Compliance Committee in
determining whether to continue the IMS Agreement.
At the
April 12-14,
2011 in-person Board meeting, Independent Legal Counsel reviewed
with the Independent Directors various factors relevant to the
Boards
COLUMBIA
SELIGMAN PREMIUM TECHNOLOGY GROWTH FUND 2011
SEMIANNUAL REPORT 37
Approval
of Investment Management Services
Agreement
(continued)
consideration of advisory agreements and the Boards legal
responsibilities related to such consideration. Following an
analysis and discussion of the factors identified below, the
Board, including all of the Independent Directors, approved
renewal of the IMS Agreement.
Nature, Extent and Quality of Services Provided by Columbia
Management:
The Independent Directors analyzed
various reports and presentations they had received detailing
the services performed by Columbia Management, as well as its
expertise, resources and capabilities. The Independent Directors
specifically considered many developments during the past year
concerning the services provided by Columbia Management,
including, in particular, the continued investment in, and
resources dedicated to, the Funds operations, most
notably, the close of the acquisition by Ameriprise Financial of
the long-term asset management business of Columbia Management
Group, LLC (the Columbia Transaction) and the
successful execution of various integration and other business
initiatives in 2010, including, implementation of complex-wide
rationalized fee structures and the rebranding of the retail
fund complex. The Independent Directors noted the information
they received concerning Columbia Managements ability to
retain key personnel in certain targeted areas and its
expectations in this regard. In that connection, the Independent
Directors took into account their meetings with Columbia
Managements new Chief Investment Officer and considered
the additional risk and portfolio management oversight now
applied to the Funds as a result. The Independent Directors also
assessed the adequacy of the current level and quality of
Columbia Managements technological resources and
considered managements commitments to enhance existing
resources in this area.
Moreover, in connection with the Boards evaluation of the
overall package of services provided by Columbia Management, the
Board considered the quality of administrative services provided
to the Fund by Columbia Management. The Board also reviewed the
financial condition of Columbia Management (and its affiliates)
and each entitys ability to carry out its responsibilities
under the IMS Agreement. In addition, the Board discussed the
acceptability of the terms of the IMS Agreement (including the
relatively broad scope of services required to be performed by
Columbia Management). The Board concluded that the services
being performed under the IMS Agreement were of a reasonably
high quality.
Based on the foregoing, and based on other information received
(both oral and written, including the information on investment
performance referenced below) and other considerations, the
Board concluded that Columbia Management and
38 COLUMBIA
SELIGMAN PREMIUM TECHNOLOGY GROWTH FUND 2011
SEMIANNUAL REPORT
its affiliates were in a position to continue to provide a high
quality and level of services to the Fund.
Investment Performance:
For purposes of
evaluating the nature, extent and quality of services provided
under the IMS Agreement, the Board carefully reviewed the
investment performance of the Fund. In this regard, the Board
considered detailed reports providing the results of analyses
performed by an independent organization showing, for various
periods, the performance of the Fund, the performance of a
benchmark index, the percentage ranking of the Fund among its
comparison group and the net assets of the Fund. The Independent
Directors observed that while the Fund underperformed its
benchmark on a market-price basis, it outperformed its benchmark
on a NAV basis and ranked in the 22nd percentile (1st quartile)
of its peer group. The Independent Directors determined that the
Funds investment performance met expectations.
Comparative Fees, Costs of Services Provided and the Profits
Realized By Columbia Management and its Affiliates from their
Relationships with the Fund
: The Board reviewed comparative
fees and the costs of services provided under the IMS Agreement.
The Board members considered detailed comparative information
set forth in an annual report on fees and expenses, including,
among other things, data (based on analyses conducted by an
independent organization) showing a comparison of the
Funds expenses with median expenses paid by funds in its
peer group, as well as data showing the Funds contribution
to Columbia Managements profitability.
The Board accorded particular weight to the notion that the
level of fees should reflect a rational pricing model applied
consistently across the various product lines in the fund
family, while assuring that the overall fees for each fund (with
few defined exceptions) are generally in line with the
pricing philosophy (
i.e.
, that the total
expense ratio of the Funds are at, or below, the median expense
ratio of funds in the same comparison group). The Board reviewed
information they received with respect to the Fund demonstrating
that its total net expense ratio was in line with its peer group
median expense ratio. The Board also noted that, unlike many
funds in the peer group, the Fund employs a unique
options-writing strategy designed to cushion its downside
performance. Based on its review, the Board concluded that the
Funds management fee was fair and reasonable in light of
the extent and quality of services that the Fund receives.
The Board also considered the profitability of Columbia
Management and its affiliates in connection with Columbia
Management providing investment management services to the Fund.
In this regard, the Board referred to a detailed
COLUMBIA
SELIGMAN PREMIUM TECHNOLOGY GROWTH FUND 2011
SEMIANNUAL REPORT 39
Approval
of Investment Management Services
Agreement
(continued)
profitability report, discussing the profitability to Columbia
Management and Ameriprise Financial from managing, operating and
distributing the Funds, including information depicting, to the
extent reasonably practicable, the expected impact of the
Columbia Transaction and the integration initiatives on
profitability. In this regard, the Board observed that 2010
profitability was generally in line with the reported
profitability of other asset management firms. The Board also
considered the indirect economic benefits flowing to Columbia
Management or its affiliates in connection with managing or
distributing the Funds, such as the enhanced ability to offer
various other financial products to Ameriprise Financial
customers, soft dollar benefits and overall reputational
advantages. The Board noted that the fees paid by the Fund
should permit the investment manager to offer competitive
compensation to its personnel, make necessary investments in its
business and earn an appropriate profit. The Board concluded
that profitability levels were reasonable.
Economies of Scale to be Realized:
The Board
noted that the management fee schedule does not contain
breakpoints that reduce the fee rate on assets above specified
levels. However, due to the Funds closed-end structure,
the Board did not view the potential for realization of
economies of scale as the Funds assets grow to be a
material factor in its deliberations.
Based on the foregoing, the Board, including all of the
Independent Directors, concluded that the investment management
service fees were fair and reasonable in light of the extent and
quality of services provided. In reaching this conclusion, no
single factor was determinative. On April 14, 2011, the
Board, including all of the Independent Directors, approved the
renewal of the IMS Agreement for an additional annual period.
40 COLUMBIA
SELIGMAN PREMIUM TECHNOLOGY GROWTH FUND 2011
SEMIANNUAL REPORT
Results
of Meeting of Stockholders
Proxy
Results
The 1st Annual Meeting of Stockholders of the Fund was held
on April 14, 2011. Stockholders voted in favor of each of
the Boards two proposals. The description of each proposal
and number of shares voted are as follows:
Proposal 1
To elect three Directors to the Funds Board, each to hold
office until the 2014 annual meeting of Stockholders and all
until their successors are elected and qualify:
|
|
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|
|
|
|
|
|
Director
|
|
For
|
|
|
Withheld
|
|
Patricia M. Flynn
|
|
|
14,276,927
|
|
|
|
81,055
|
|
Catherine James Paglia
|
|
|
14,272,596
|
|
|
|
85,386
|
|
Stephen R. Lewis, Jr.
|
|
|
14,264,994
|
|
|
|
92,988
|
|
|
|
|
|
|
|
|
|
|
Proposal 2
To ratify the selection of Ernst & Young LLP as the
Funds independent registered public accounting firm for
2011:
|
|
|
|
|
|
|
|
|
For
|
|
Against
|
|
|
Abstaining
|
|
14,251,104
|
|
|
29,880
|
|
|
|
76,993
|
|
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|
|
|
|
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COLUMBIA
SELIGMAN PREMIUM TECHNOLOGY GROWTH FUND 2011
SEMIANNUAL REPORT 41
Columbia
Seligman Premium Technology Growth Fund
P.O.
Box 8081
Boston,
MA 02255-8081
columbiamanagement.com
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You should consider the investment objectives, risks, charges
and expenses of the Fund carefully before investing. You can
obtain the Funds most recent periodic reports and other
regulatory filings by contacting your financial advisor or
American Stock Transfer & Trust Company at 800.937.5449.
These reports and other filings can also be found on the
Securities and Exchange Commissions EDGAR Database. You
should read these reports and other filings carefully before
investing.
©
2011
Columbia Management Investment Advisers, LLC
|
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SL-9949 D (8/11)
|
Item 2. Code of Ethics. Not applicable for semi-annual reports.
Item 3. Audit Committee Financial Expert. Not applicable for semi-annual
reports.
Item 4. Principal Accountant Fees and Services. Not applicable for
semi-annual reports.
Item 5. Audit Committee of Listed Registrants. Not applicable.
Item 6. Investments.
(a)
|
|
The registrants Schedule 1 Investments in securities of unaffiliated issuers (as set
forth in 17 CFR 210.12-12) is included in Item 1 of this Form N-CSR.
|
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(b)
|
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Not applicable.
|
Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End
Management Investment Companies. Not applicable.
Item 8. Portfolio Managers of Closed-End Management Investment Companies.
Not applicable.
Item 9. Purchases of Equity Securities by Closed-End Management Investment
Company and Affiliated Purchasers. Not applicable.
Item 10. Submission of Matters to a Vote of Security Holders.
There were no material changes to the procedure by which shareholders may recommend
nominees to the registrants board of directors.
Item 11. Controls and Procedures.
(a) The registrants principal executive officer and principal financial officer,
based on their evaluation of the registrants disclosure controls and procedures as of a
date within 90 days of the filing of this report, have concluded that such controls and
procedures are adequately designed to ensure that information required to be disclosed
by the registrant in Form N-CSR is accumulated and communicated to the registrants
management, including the principal executive officer and principal financial officer,
or persons performing similar functions, as appropriate to allow timely decisions
regarding required disclosure.
(b) There was no change in the registrants internal controls over financial reporting
that occurred during the registrants second fiscal quarter of the period covered by this
report that has materially affected, or is reasonably likely to materially affect, the
registrants internal control over financial reporting.
Item 12. Exhibits.
(a)(1) Code of ethics required to be disclosed under Item 2 of Form N-CSR: Not applicable for semi
annual reports.
(a)(2) Certifications pursuant to Rule 30a-2(a) under the Investment Company Act of 1940 (17 CFR
270.30a-2(a)) attached hereto as Exhibit 99.CERT.
(a)(3) Not applicable.
(b) Certification pursuant to Rule 30a-2(b) under the Investment Company Act of 1940 (17 CFR
270.30a-2(b)) attached hereto as Exhibit 99.906CERT.
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.
(Registrant) Columbia Seligman Premium Technology Growth Fund, Inc.
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By
|
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/s/ J. Kevin Connaughton
J. Kevin Connaughton
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President and Principal Executive Officer
|
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Date
|
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August 19, 2011
|
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Pursuant to the requirements of the Securities Exchange Act of 1934 and
the Investment Company Act of 1940, this report has been signed below by the
following persons on behalf of the Registrant and in the capacities and on the
dates indicated.
|
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By
|
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/s/ J. Kevin Connaughton
J. Kevin Connaughton
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President and Principal Executive Officer
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Date
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August 19, 2011
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By
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/s/ Michael G. Clarke
Michael G. Clarke
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Treasurer and Principal Financial Officer
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Date
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August 19, 2011
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