When Saba has been able to push through its demands at other
closed-end funds, it often resulted in those funds pursuing tender offers, open-end conversions, or other liquidity events. Almost every publicly-disclosed settlement
agreement into which Saba has entered with a closed-end fund since 2016 contemplated some form of liquidity event such as a tender offer or a liquidation of the fund that resulted in Saba getting its shares cashed-out at a price approximating NAV.3
We believe that
Sabas demands for a fund to pursue a liquidity event are designed solely to provide Saba with a quick, one-time payout, while leaving the funds remaining investors with a weakened and less viable
fund that is saddled with higher expenses. It is important to bear in mind that, in past situations where Saba achieved its goal of profiting from a funds NAV discount, it almost always substantially reduced its investment or sold-out completely thereafter, further proving our belief that Saba is only concerned about its own investment returns, not the investment goals or returns of a funds long-term investors.
We have little doubt that Saba is once again taking a page from its activist investor playbook and is seeking to force the Fund to pursue a liquidity
event that provides Saba with the ability to tender or liquidate its shares at a per share price that is close to NAV, without any regard for the investment goals and/or returns of the Funds long-term investors.
If Saba forces the Fund to pursue a liquidity event, the Fund may be significantly weakened and no longer a viable vehicle for investors seeking high
current income.
If, consistent with its past history, Saba forces the Fund to pursue a liquidity event such as a tender offer or a liquidation
of the Fund, this course of action could require the Fund to sell assets into a dislocated market and incur substantial expenses. This forced sale could leave remaining investors with a Fund that is a shell of its former self and not able to provide
investors with the benefits of a market recovery, or with the high current income, all while interrupting capital preservation, which the Fund has reliably delivered. A substantial forced sale would run the risk to the Fund and its shareholders of
the Fund having to sell assets into a dislocated and depressed market, while also incurring the opportunity cost of not being able to fully benefit from a market recovery in the years ahead.
Given current market conditions, we believe that Sabas agenda could be especially detrimental to the interests of long-term investors in the Fund
and that it is simply the wrong time to allow an opportunistic activist investor such as Saba to pressure the Fund to pursue some form of liquidity event just so Saba can extract a quick, one-time payout, a
payout that could adversely impact the future viability of the Fund and its ability to meet its stated investment objective.
Preserve your
Funds future and its viability as a vehicle for those investors seeking a high level of current income by opposing Sabas self-serving proxy contest, the three candidates Saba handpicked from its nominee bullpen, and
Sabas potentially devastating proposal to terminate the Funds investment advisory agreement.
Your vote is important, no matter how
many shares you own. Your Board unanimously recommends that shareholders vote on the WHITE proxy card FOR ALL the Funds highly qualified and very experienced nominees, all of whom are valued members of your Board,
and AGAINST Sabas proposal to terminate the Funds investment advisory agreement with Amundi Pioneer. You may also vote by phone or Internet by following the instructions on the enclosed WHITE proxy card. Your
Board encourages you to vote each WHITE proxy card you receive.
If you hold shares through a broker, bank, or other custodian, you
will receive voting materials from that firm. You can complete the WHITE voting instruction form by internet, telephone, or mail. The voting instruction form will contain instructions on how to access and utilize those voting methods.
Since this is a contested proxy solicitation, if you do not give voting instructions to your broker, bank, or other custodian, pursuant to the rules of the New York Stock Exchange, your broker, bank, or other custodian will not be able to vote your
shares with respect to the election of trustees or Sabas proposal to terminate the Funds investment advisory agreement. We urge you to
3
Source: Factset Research, Inc. as of July 31, 2020.