Certified Semi-annual Shareholder Report for Management Investment Companies (n-csrs)
04 Septiembre 2019 - 10:07AM
Edgar (US Regulatory)
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 811-00266
Tri-Continental Corporation
(Exact name of registrant as specified in charter)
225 Franklin
Street, Boston, Massachusetts 02110
(Address of principal executive offices) (Zip code)
Christopher O. Petersen
c/o Columbia Management Investment Advisers, LLC
225 Franklin Street
Boston, Massachusetts 02110
Ryan C. Larrenaga, Esq.
c/o Columbia Management Investment Advisers, LLC
225 Franklin Street
Boston, MA 02110
(Name
and address of agent for service)
Registrant’s telephone number, including area code: (800) 345-6611
Date of fiscal year end: December 31
Date of reporting period: June 30, 2019
Form N-CSR is to be used by management investment companies to file reports with the Commission not later than 10 days after the transmission to stockholders of any report that is required to be transmitted to
stockholders under Rule 30e-1 under the Investment Company Act of 1940 (17 CFR 270.30e-1). The Commission may use the information provided on Form N-CSR in its regulatory, disclosure review, inspection, and policymaking roles.
A registrant is required to disclose
the information specified by Form N-CSR, and the Commission will make this information public. A registrant is not required to respond to the collection of information contained in Form N-CSR unless the Form displays a currently valid Office of Management and Budget (“OMB”) control number. Please direct comments concerning the accuracy of the information collection burden estimate and any
suggestions for reducing the burden to Secretary, Securities and Exchange Commission, 100 F Street, NE, Washington, DC 20549. The OMB has reviewed this collection of information under the clearance requirements of 44 U.S.C. § 3507.
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Item 1.
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Reports to Stockholders.
|
SemiAnnual
Report
June 30, 2019
Tri-Continental Corporation
Beginning on January 1, 2021, as permitted by regulations
adopted by the Securities and Exchange Commission, paper copies of the Fund’s annual and semiannual stockholder reports will no longer be sent by mail, unless you specifically request paper copies of the reports. Instead, the reports will be
made available on the Fund’s website (columbiathreadneedleus.com/investor/), and each time a report is posted you will be notified by mail and provided with a website address to access the report.
If you have already elected to receive stockholder reports
electronically, you will not be affected by this change and you need not take any action. You may elect to receive stockholder reports and other communications from the Fund electronically at any time by contacting your financial intermediary (such
as a broker-dealer or bank) or, for Fund shares held directly with the Fund, by calling 800.345.6611, option 3, or by enrolling in “eDelivery” by logging into your account at columbiathreadneedleus.com/investor/.
You may elect to receive all future reports in paper free of
charge. If you invest through a financial intermediary, you can contact your financial intermediary to request that you continue receiving paper copies of your stockholder reports. If you invest directly with the Fund, you can call 800.345.6611,
option 3, to let the Fund know you wish to continue receiving paper copies of your stockholder reports. Your election to receive paper reports will apply to the Fund and all other Columbia Funds held in your account if you invest through a financial
intermediary or to the Fund and all other Columbia Funds held with the fund complex if you invest directly with the Fund.
Not FDIC Insured • No bank guarantee • May lose
value
Letter to the Stockholders
Dear
Stockholders,
We are pleased to present the semiannual
stockholder report for Tri-Continental Corporation (the Fund). The report includes the Fund’s investment results, the portfolio of investments and financial statements as of June 30, 2019.
The Fund’s common shares (Common Stock) returned 15.59%,
based on net asset value, and 17.32%, based on market price, for the six months ended June 30, 2019. During the same six-month period, the S&P 500 Index returned 18.54% and the Fund’s Blended Benchmark returned 16.14%.
During the first six months of 2019, the Fund paid two
distributions in accordance with its distribution policy that aggregated to $0.5050 per share of Common Stock of the Fund. These distributions were based upon amounts distributed by underlying portfolio companies owned by the Fund. In addition, the
Fund paid one capital gain distribution that totalled $0.1065 per share of Common Stock. The Fund has paid dividends on its Common Stock for 75 consecutive years.
On April 16, 2019, the Fund held its 89th Annual Meeting of
Stockholders in Minneapolis, MN. Stockholders elected three Directors at the meeting, Ms. Minor M. Shaw and Messrs. Anthony M. Santomero and William F. Truscott, each for a term that will expire at the Fund’s 2022 Annual Meeting of
Stockholders. Stockholders also ratified the Board of Directors’ (the Board) selection of PricewaterhouseCoopers LLP as the Fund’s independent registered public accounting firm for 2019. The results of the proposals voted on can be found
on page 33 of this report
Information about the Fund,
including daily pricing, current performance, Fund holdings, stockholder reports, the current prospectus for the Fund, distributions and other information can be found at columbiathreadneedleus.com/investor/ under the Closed-End Funds tab.
On behalf of the Board, I would like to thank you for your
continued support of Tri-Continental Corporation.
Regards,
Edward J. Boudreau,
Jr.
Chairman of the Board
Tri-Continental
Corporation | Semiannual Report 2019
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2
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4
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15
|
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16
|
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17
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18
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19
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30
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33
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34
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Tri-Continental Corporation | Semiannual Report
2019
Fund at a Glance
(Unaudited)
Investment objective
Tri-Continental Corporation (the
Fund) seeks future growth of both capital and income while providing reasonable current income.
Portfolio
management
Brian Condon, CFA,
CAIA
Co-Portfolio
Manager
Managed Fund
since 2010
David King,
CFA
Co-Portfolio
Manager
Managed Fund
since 2011
Yan Jin
Co-Portfolio
Manager
Managed Fund
since 2012
Peter
Albanese
Co-Portfolio
Manager
Managed Fund
since 2014
|
Average
annual total returns (%) (for the period ended June 30, 2019)
|
|
|
|
Inception
|
6
Months
cumulative
|
1
Year
|
5
Years
|
10
Years
|
|
Market
Price
|
01/05/29
|
17.32
|
9.43
|
10.45
|
15.75
|
|
Net
Asset Value
|
01/05/29
|
15.59
|
7.91
|
9.49
|
14.78
|
|
S&P
500 Index
|
|
18.54
|
10.42
|
10.71
|
14.70
|
|
Blended
Benchmark
|
|
16.14
|
9.53
|
8.56
|
12.74
|
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 columbiathreadneedleus.com/investor/.
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.
The S&P 500 Index, an unmanaged index, measures the
performance of 500 widely held, large-capitalization U.S. stocks and is frequently used as a general measure of market performance.
The Blended Benchmark, a weighted custom composite established
by the Investment Manager, consists of a 50% weighting in the S&P 500 Index, a 16.68% weighting in the Russell 1000 Value Index, a 16.66% weighting in the Bloomberg Barclays U.S. Corporate Investment Grade & High Yield Index and a 16.66%
weighting in the Bloomberg Barclays U.S. Convertible Composite Index.
Indices are not available for investment, are not
professionally managed and do not reflect sales charges, fees, brokerage commissions, taxes or other expenses of investing. Securities in the Fund may not match those in an index.
|
Price
Per Share
|
|
|
June
30, 2019
|
March
31, 2019
|
December
31, 2018
|
|
|
Market
Price ($)
|
26.97
|
26.30
|
23.52
|
|
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Net
Asset Value ($)
|
30.03
|
29.60
|
26.58
|
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Distributions
Paid Per Common Share(a)
|
|
Payable
Date
|
Per
Share Amount ($)
|
|
March
28, 2019
|
0.2400
|
|
June
27, 2019
|
0.3715
(b)
|
(a) Preferred Stockholders were paid dividends totaling $1.25
per share.
(b) Includes a distribution of $0.2650 from
ordinary income and a capital gain distribution of $0.1065 per share.
The net asset value of the Fund’s 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.
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2
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Tri-Continental Corporation
| Semiannual Report 2019
|
Fund at a Glance (continued)
(Unaudited)
|
Top
10 holdings (%) (at June 30, 2019)
|
|
Alphabet,
Inc., Class A
|
2.1
|
|
Cisco
Systems, Inc.
|
1.9
|
|
Verizon
Communications, Inc.
|
1.8
|
|
Facebook,
Inc., Class A
|
1.7
|
|
Broadcom,
Inc.
|
1.6
|
|
MasterCard,
Inc., Class A
|
1.4
|
|
Merck
& Co., Inc.
|
1.4
|
|
Citigroup,
Inc.
|
1.3
|
|
Microsoft
Corp.
|
1.3
|
|
Amazon.com,
Inc.
|
1.3
|
Percentages indicated are based
upon total investments excluding Money Market Funds and investments in derivatives, if any.
For further detail about these holdings, please refer to the
section entitled “Portfolio of Investments.”
Fund holdings are as of the date given, are subject to change
at any time, and are not recommendations to buy or sell any security.
|
Portfolio
breakdown (%) (at June 30, 2019)
|
|
Common
Stocks
|
67.3
|
|
Convertible
Bonds
|
7.6
|
|
Convertible
Preferred Stocks
|
7.4
|
|
Corporate
Bonds & Notes
|
14.6
|
|
Limited
Partnerships
|
0.5
|
|
Money
Market Funds
|
1.5
|
|
Preferred
Debt
|
0.6
|
|
Senior
Loans
|
0.5
|
|
Warrants
|
0.0
(a)
|
|
Total
|
100.0
|
Percentages indicated are based
upon total investments excluding investments in derivatives, if any. The Fund’s portfolio composition is subject to change.
|
Equity
sector breakdown (%) (at June 30, 2019)
|
|
Communication
Services
|
7.9
|
|
Consumer
Discretionary
|
8.7
|
|
Consumer
Staples
|
7.0
|
|
Energy
|
5.7
|
|
Financials
|
15.7
|
|
Health
Care
|
14.7
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|
Industrials
|
8.7
|
|
Information
Technology
|
20.1
|
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Materials
|
2.3
|
|
Real
Estate
|
3.7
|
|
Utilities
|
5.5
|
|
Total
|
100.0
|
Percentages indicated are based
upon total long equity investments. The Fund’s portfolio composition is subject to change.
Tri-Continental
Corporation | Semiannual Report 2019
|
3
|
Portfolio of Investments
June 30, 2019 (Unaudited)
(Percentages represent value of investments compared to net
assets)
Investments in securities
|
Common
Stocks 67.1%
|
|
Issuer
|
Shares
|
Value
($)
|
|
Communication
Services 5.9%
|
|
Diversified
Telecommunication Services 2.1%
|
|
AT&T,
Inc.
|
190,000
|
6,366,900
|
|
Verizon
Communications, Inc.
|
501,900
|
28,673,547
|
|
Total
|
|
35,040,447
|
|
Interactive
Media & Services 3.8%
|
|
Alphabet,
Inc., Class A(a)
|
30,925
|
33,485,590
|
|
Facebook,
Inc., Class A(a)
|
145,300
|
28,042,900
|
|
Total
|
|
61,528,490
|
|
Total
Communication Services
|
96,568,937
|
|
Consumer
Discretionary 6.5%
|
|
Automobiles
0.7%
|
|
General
Motors Co.
|
165,000
|
6,357,450
|
|
Harley-Davidson,
Inc.
|
156,900
|
5,621,727
|
|
Total
|
|
11,979,177
|
|
Hotels,
Restaurants & Leisure 1.9%
|
|
Carnival
Corp.
|
75,000
|
3,491,250
|
|
Extended
Stay America, Inc.
|
320,000
|
5,404,800
|
|
Six
Flags Entertainment Corp.
|
80,000
|
3,974,400
|
|
Starbucks
Corp.
|
212,800
|
17,839,024
|
|
Total
|
|
30,709,474
|
|
Internet
& Direct Marketing Retail 1.4%
|
|
Amazon.com,
Inc.(a)
|
10,725
|
20,309,182
|
|
Expedia
Group, Inc.
|
23,500
|
3,126,205
|
|
Total
|
|
23,435,387
|
|
Specialty
Retail 1.4%
|
|
Advance
Auto Parts, Inc.
|
56,100
|
8,647,254
|
|
AutoZone,
Inc.(a)
|
7,975
|
8,768,273
|
|
Best
Buy Co., Inc.
|
16,200
|
1,129,626
|
|
Home
Depot, Inc. (The)
|
21,500
|
4,471,355
|
|
Total
|
|
23,016,508
|
|
Textiles,
Apparel & Luxury Goods 1.1%
|
|
Nike,
Inc., Class B
|
159,900
|
13,423,605
|
|
Tapestry,
Inc.
|
130,000
|
4,124,900
|
|
Total
|
|
17,548,505
|
|
Total
Consumer Discretionary
|
106,689,051
|
|
Common
Stocks (continued)
|
|
Issuer
|
Shares
|
Value
($)
|
|
Consumer
Staples 5.0%
|
|
Food
& Staples Retailing 1.2%
|
|
Walgreens
Boots Alliance, Inc.
|
181,750
|
9,936,273
|
|
Walmart,
Inc.
|
90,100
|
9,955,149
|
|
Total
|
|
19,891,422
|
|
Food
Products 1.3%
|
|
ConAgra
Foods, Inc.
|
200,000
|
5,304,000
|
|
General
Mills, Inc.
|
150,000
|
7,878,000
|
|
Tyson
Foods, Inc., Class A
|
102,000
|
8,235,480
|
|
Total
|
|
21,417,480
|
|
Household
Products 0.9%
|
|
Kimberly-Clark
Corp.
|
99,850
|
13,308,008
|
|
Procter
& Gamble Co. (The)
|
19,300
|
2,116,245
|
|
Total
|
|
15,424,253
|
|
Tobacco
1.6%
|
|
Altria
Group, Inc.
|
200,900
|
9,512,615
|
|
Philip
Morris International, Inc.
|
200,200
|
15,721,706
|
|
Total
|
|
25,234,321
|
|
Total
Consumer Staples
|
81,967,476
|
|
Energy
3.6%
|
|
Oil,
Gas & Consumable Fuels 3.6%
|
|
BP
PLC, ADR
|
185,000
|
7,714,500
|
|
Chevron
Corp.(b)
|
61,300
|
7,628,172
|
|
ConocoPhillips
Co.
|
233,500
|
14,243,500
|
|
HollyFrontier
Corp.
|
93,800
|
4,341,064
|
|
Marathon
Petroleum Corp.
|
68,600
|
3,833,368
|
|
Suncor
Energy, Inc.
|
250,000
|
7,790,000
|
|
Valero
Energy Corp.
|
146,300
|
12,524,743
|
|
Total
|
|
58,075,347
|
|
Total
Energy
|
58,075,347
|
|
Financials
9.9%
|
|
Banks
3.5%
|
|
Bank
of America Corp.
|
406,000
|
11,774,000
|
|
BB&T
Corp.
|
125,000
|
6,141,250
|
|
Citigroup,
Inc.
|
295,800
|
20,714,874
|
|
Comerica,
Inc.
|
53,900
|
3,915,296
|
The accompanying Notes to Portfolio of Investments are an integral
part of this statement.
|
4
|
Tri-Continental Corporation
| Semiannual Report 2019
|
Portfolio of Investments (continued)
June 30, 2019 (Unaudited)
|
Common
Stocks (continued)
|
|
Issuer
|
Shares
|
Value
($)
|
|
JPMorgan
Chase & Co.
|
72,500
|
8,105,500
|
|
PacWest
Bancorp
|
155,000
|
6,018,650
|
|
Total
|
|
56,669,570
|
|
Capital
Markets 2.7%
|
|
Ares
Capital Corp.
|
425,000
|
7,624,500
|
|
Bank
of New York Mellon Corp. (The)
|
45,000
|
1,986,750
|
|
CME
Group, Inc.
|
5,800
|
1,125,838
|
|
Franklin
Resources, Inc.
|
198,900
|
6,921,720
|
|
Intercontinental
Exchange, Inc.
|
186,100
|
15,993,434
|
|
Invesco
Ltd.
|
48,800
|
998,448
|
|
Morgan
Stanley
|
18,500
|
810,485
|
|
S&P
Global, Inc.
|
4,500
|
1,025,055
|
|
T.
Rowe Price Group, Inc.
|
32,900
|
3,609,459
|
|
TCG
BDC, Inc.
|
250,000
|
3,810,000
|
|
Total
|
|
43,905,689
|
|
Consumer
Finance 0.8%
|
|
Capital
One Financial Corp.
|
150,200
|
13,629,148
|
|
Diversified
Financial Services 0.4%
|
|
Voya
Financial, Inc.
|
106,800
|
5,906,040
|
|
Insurance
1.8%
|
|
Allstate
Corp. (The)
|
71,500
|
7,270,835
|
|
Aon
PLC
|
16,900
|
3,261,362
|
|
MetLife,
Inc.
|
97,200
|
4,827,924
|
|
Prudential
Financial, Inc.
|
146,200
|
14,766,200
|
|
Total
|
|
30,126,321
|
|
Mortgage
Real Estate Investment Trusts (REITS) 0.7%
|
|
Blackstone
Mortgage Trust, Inc.
|
92,500
|
3,291,150
|
|
Starwood
Property Trust, Inc.
|
350,000
|
7,952,000
|
|
Total
|
|
11,243,150
|
|
Total
Financials
|
161,479,918
|
|
Health
Care 9.3%
|
|
Biotechnology
1.8%
|
|
AbbVie,
Inc.
|
108,290
|
7,874,849
|
|
Alexion
Pharmaceuticals, Inc.(a)
|
42,570
|
5,575,818
|
|
Amgen,
Inc.
|
4,000
|
737,120
|
|
BioMarin
Pharmaceutical, Inc.(a)
|
36,200
|
3,100,530
|
|
Common
Stocks (continued)
|
|
Issuer
|
Shares
|
Value
($)
|
|
Gilead
Sciences, Inc.
|
97,700
|
6,600,612
|
|
Vertex
Pharmaceuticals, Inc.(a)
|
26,350
|
4,832,063
|
|
Total
|
|
28,720,992
|
|
Health
Care Equipment & Supplies 0.8%
|
|
Abbott
Laboratories
|
84,900
|
7,140,090
|
|
Baxter
International, Inc.
|
83,600
|
6,846,840
|
|
Total
|
|
13,986,930
|
|
Health
Care Providers & Services 1.6%
|
|
AmerisourceBergen
Corp.
|
15,800
|
1,347,108
|
|
Cardinal
Health, Inc.
|
291,790
|
13,743,309
|
|
McKesson
Corp.
|
80,000
|
10,751,200
|
|
Total
|
|
25,841,617
|
|
Pharmaceuticals
5.1%
|
|
Allergan
PLC
|
23,000
|
3,850,890
|
|
Bristol-Myers
Squibb Co.
|
413,700
|
18,761,295
|
|
Eli
Lilly & Co.
|
108,900
|
12,065,031
|
|
Johnson
& Johnson
|
121,300
|
16,894,664
|
|
Merck
& Co., Inc.
|
275,300
|
23,083,905
|
|
Mylan
NV(a)
|
62,900
|
1,197,616
|
|
Pfizer,
Inc.
|
180,000
|
7,797,600
|
|
Total
|
|
83,651,001
|
|
Total
Health Care
|
152,200,540
|
|
Industrials
5.9%
|
|
Aerospace
& Defense 1.8%
|
|
Boeing
Co. (The)
|
51,200
|
18,637,312
|
|
L3
Harris Technologies, Inc.
|
16,800
|
3,177,384
|
|
Lockheed
Martin Corp.
|
22,500
|
8,179,650
|
|
Total
|
|
29,994,346
|
|
Air
Freight & Logistics 0.4%
|
|
United
Parcel Service, Inc., Class B
|
60,000
|
6,196,200
|
|
Airlines
0.8%
|
|
Southwest
Airlines Co.
|
264,500
|
13,431,310
|
|
Electrical
Equipment 0.2%
|
|
Rockwell
Automation, Inc.
|
23,900
|
3,915,537
|
|
Industrial
Conglomerates 0.5%
|
|
Honeywell
International, Inc.
|
42,400
|
7,402,616
|
|
Machinery
1.3%
|
The accompanying Notes to Portfolio of Investments are an integral
part of this statement.
Tri-Continental
Corporation | Semiannual Report 2019
|
5
|
Portfolio of Investments (continued)
June 30, 2019 (Unaudited)
|
Common
Stocks (continued)
|
|
Issuer
|
Shares
|
Value
($)
|
|
Cummins,
Inc.
|
46,000
|
7,881,640
|
|
Snap-On,
Inc.
|
78,600
|
13,019,304
|
|
Total
|
|
20,900,944
|
|
Professional
Services 0.2%
|
|
Robert
Half International, Inc.
|
50,900
|
2,901,809
|
|
Road
& Rail 0.4%
|
|
CSX
Corp.
|
34,300
|
2,653,791
|
|
Union
Pacific Corp.
|
26,900
|
4,549,059
|
|
Total
|
|
7,202,850
|
|
Transportation
Infrastructure 0.3%
|
|
Macquarie
Infrastructure Corp.
|
105,000
|
4,256,700
|
|
Total
Industrials
|
96,202,312
|
|
Information
Technology 14.7%
|
|
Communications
Equipment 2.1%
|
|
Cisco
Systems, Inc.
|
563,800
|
30,856,774
|
|
F5
Networks, Inc.(a)
|
21,200
|
3,087,356
|
|
Total
|
|
33,944,130
|
|
Electronic
Equipment, Instruments & Components 0.4%
|
|
Corning,
Inc.
|
185,000
|
6,147,550
|
|
IT
Services 3.4%
|
|
International
Business Machines Corp.
|
45,000
|
6,205,500
|
|
MasterCard,
Inc., Class A
|
87,700
|
23,199,281
|
|
VeriSign,
Inc.(a)
|
76,900
|
16,084,404
|
|
Visa,
Inc., Class A
|
59,300
|
10,291,515
|
|
Total
|
|
55,780,700
|
|
Semiconductors
& Semiconductor Equipment 3.7%
|
|
Broadcom,
Inc.
|
86,700
|
24,957,462
|
|
Intel
Corp.
|
87,500
|
4,188,625
|
|
Lam
Research Corp.
|
64,200
|
12,059,328
|
|
Maxim
Integrated Products, Inc.
|
100,000
|
5,982,000
|
|
Qorvo,
Inc.(a)
|
14,600
|
972,506
|
|
QUALCOMM,
Inc.
|
60,000
|
4,564,200
|
|
Texas
Instruments, Inc.
|
70,000
|
8,033,200
|
|
Total
|
|
60,757,321
|
|
Common
Stocks (continued)
|
|
Issuer
|
Shares
|
Value
($)
|
|
Software
3.2%
|
|
Adobe,
Inc.(a)
|
63,800
|
18,798,670
|
|
Fortinet,
Inc.(a)
|
49,800
|
3,826,134
|
|
Microsoft
Corp.
|
152,700
|
20,455,692
|
|
VMware,
Inc., Class A
|
54,900
|
9,179,829
|
|
Total
|
|
52,260,325
|
|
Technology
Hardware, Storage & Peripherals 1.9%
|
|
Apple,
Inc.
|
80,750
|
15,982,040
|
|
HP,
Inc.
|
386,000
|
8,024,940
|
|
Western
Digital Corp.
|
150,000
|
7,132,500
|
|
Total
|
|
31,139,480
|
|
Total
Information Technology
|
240,029,506
|
|
Materials
1.8%
|
|
Chemicals
1.1%
|
|
Dow,
Inc.
|
82,500
|
4,068,075
|
|
LyondellBasell
Industries NV, Class A
|
160,600
|
13,832,478
|
|
Total
|
|
17,900,553
|
|
Metals
& Mining 0.7%
|
|
Nucor
Corp.
|
195,400
|
10,766,540
|
|
Total
Materials
|
28,667,093
|
|
Real
Estate 2.4%
|
|
Equity
Real Estate Investment Trusts (REITS) 2.4%
|
|
Alexandria
Real Estate Equities, Inc.
|
42,500
|
5,996,325
|
|
American
Tower Corp.
|
24,600
|
5,029,470
|
|
Digital
Realty Trust, Inc.
|
50,000
|
5,889,500
|
|
Duke
Realty Corp.
|
132,500
|
4,188,325
|
|
Host
Hotels & Resorts, Inc.
|
400,900
|
7,304,398
|
|
Simon
Property Group, Inc.
|
69,800
|
11,151,248
|
|
Total
|
|
39,559,266
|
|
Total
Real Estate
|
39,559,266
|
|
Utilities
2.1%
|
|
Electric
Utilities 1.3%
|
|
American
Electric Power Co., Inc.
|
40,400
|
3,555,604
|
|
Edison
International
|
60,000
|
4,044,600
|
|
Exelon
Corp.
|
289,400
|
13,873,836
|
|
Total
|
|
21,474,040
|
The accompanying Notes to Portfolio of Investments are an integral
part of this statement.
|
6
|
Tri-Continental Corporation
| Semiannual Report 2019
|
Portfolio of Investments (continued)
June 30, 2019 (Unaudited)
|
Common
Stocks (continued)
|
|
Issuer
|
Shares
|
Value
($)
|
|
Independent
Power and Renewable Electricity Producers 0.6%
|
|
AES
Corp. (The)
|
183,400
|
3,073,784
|
|
NRG
Energy, Inc.
|
196,800
|
6,911,616
|
|
Total
|
|
9,985,400
|
|
Multi-Utilities
0.2%
|
|
Public
Service Enterprise Group, Inc.
|
44,100
|
2,593,962
|
|
Total
Utilities
|
34,053,402
|
Total
Common Stocks
(Cost $972,169,291)
|
1,095,492,848
|
|
Convertible
Bonds 7.6%
|
|
Issuer
|
Coupon
Rate
|
|
Principal
Amount ($)
|
Value
($)
|
|
Cable
and Satellite 0.5%
|
|
DISH
Network Corp.
|
|
08/15/2026
|
3.375%
|
|
8,000,000
|
7,777,473
|
|
Gaming
0.2%
|
|
Caesars
Entertainment Corp.
|
|
10/01/2024
|
5.000%
|
|
2,300,000
|
3,936,854
|
|
Health
Care 0.4%
|
|
Invacare
Corp.
|
|
02/15/2021
|
5.000%
|
|
4,000,000
|
3,250,554
|
|
Novavax,
Inc.
|
|
02/01/2023
|
3.750%
|
|
6,800,000
|
2,675,800
|
|
Total
|
5,926,354
|
|
Home
Construction 0.4%
|
|
SunPower
Corp.
|
|
01/15/2023
|
4.000%
|
|
7,500,000
|
6,647,675
|
|
Independent
Energy 0.4%
|
|
Chesapeake
Energy Corp.
|
|
09/15/2026
|
5.500%
|
|
9,000,000
|
7,183,607
|
|
Life
Insurance 0.3%
|
|
AXA
SA(c)
|
|
05/15/2021
|
7.250%
|
|
4,100,000
|
4,195,653
|
|
Metals
and Mining 0.3%
|
|
Endeavour
Mining Corp.(c)
|
|
02/15/2023
|
3.000%
|
|
4,600,000
|
4,482,240
|
|
Oil
Field Services 0.1%
|
|
Bristow
Group, Inc.(d)
|
|
06/01/2023
|
0.000%
|
|
3,658,000
|
768,180
|
|
Convertible
Bonds (continued)
|
|
Issuer
|
Coupon
Rate
|
|
Principal
Amount ($)
|
Value
($)
|
|
Other
Industry 0.2%
|
|
Green
Plains, Inc.
|
|
09/01/2022
|
4.125%
|
|
4,600,000
|
3,966,186
|
|
Other
REIT 0.6%
|
|
Blackstone
Mortgage Trust, Inc.
|
|
05/05/2022
|
4.375%
|
|
4,200,000
|
4,377,462
|
|
IH
Merger Sub LLC
|
|
01/15/2022
|
3.500%
|
|
4,700,000
|
5,730,674
|
|
Total
|
10,108,136
|
|
Pharmaceuticals
2.5%
|
|
Aegerion
Pharmaceuticals, Inc.(d)
|
|
08/15/2019
|
2.000%
|
|
5,000,000
|
3,503,125
|
|
Alder
Biopharmaceuticals, Inc.
|
|
02/01/2025
|
2.500%
|
|
4,500,000
|
4,182,188
|
|
Clovis
Oncology, Inc.
|
|
05/01/2025
|
1.250%
|
|
8,000,000
|
4,977,020
|
|
Dermira,
Inc.
|
|
05/15/2022
|
3.000%
|
|
5,200,000
|
4,479,947
|
|
Insmed,
Inc.
|
|
01/15/2025
|
1.750%
|
|
4,300,000
|
4,175,752
|
|
Intercept
Pharmaceuticals, Inc.
|
|
07/01/2023
|
3.250%
|
|
4,300,000
|
3,833,948
|
|
Medicines
Co. (The)
|
|
07/15/2023
|
2.750%
|
|
6,000,000
|
6,001,073
|
|
Radius
Health, Inc.
|
|
09/01/2024
|
3.000%
|
|
5,000,000
|
4,524,491
|
|
Tilray,
Inc.(c)
|
|
10/01/2023
|
5.000%
|
|
5,250,000
|
4,232,812
|
|
Total
|
39,910,356
|
|
Property
& Casualty 0.6%
|
|
Heritage
Insurance Holdings, Inc.
|
|
08/01/2037
|
5.875%
|
|
3,500,000
|
4,287,808
|
|
MGIC
Investment Corp.(c),(e)
|
|
Junior
Subordinated
|
|
04/01/2063
|
9.000%
|
|
4,711,000
|
6,204,816
|
|
Total
|
10,492,624
|
|
Retailers
0.3%
|
|
GNC
Holdings, Inc.
|
|
08/15/2020
|
1.500%
|
|
5,700,000
|
4,830,750
|
|
Technology
0.7%
|
|
Microchip
Technology, Inc.
|
|
Junior
Subordinated
|
|
02/15/2037
|
2.250%
|
|
6,500,000
|
7,654,399
|
The accompanying Notes to Portfolio of Investments are an integral
part of this statement.
Tri-Continental
Corporation | Semiannual Report 2019
|
7
|
Portfolio of Investments (continued)
June 30, 2019 (Unaudited)
|
Convertible
Bonds (continued)
|
|
Issuer
|
Coupon
Rate
|
|
Principal
Amount ($)
|
Value
($)
|
|
Veeco
Instruments, Inc.
|
|
01/15/2023
|
2.700%
|
|
5,000,000
|
4,436,227
|
|
Total
|
12,090,626
|
|
Wireless
0.1%
|
|
Gogo,
Inc.(c)
|
|
05/15/2022
|
6.000%
|
|
2,200,000
|
2,024,000
|
Total
Convertible Bonds
(Cost $135,361,244)
|
124,340,714
|
|
Convertible
Preferred Stocks 7.4%
|
|
Issuer
|
|
Shares
|
Value
($)
|
|
Consumer
Staples 0.2%
|
|
Household
Products 0.2%
|
|
Energizer
Holdings, Inc.
|
7.500%
|
45,000
|
3,971,047
|
|
Total
Consumer Staples
|
3,971,047
|
|
Energy
0.2%
|
|
Energy
Equipment & Services 0.2%
|
|
Nabors
Industries Ltd.
|
6.000%
|
145,000
|
3,364,000
|
|
Total
Energy
|
3,364,000
|
|
Financials
1.9%
|
|
Banks
0.9%
|
|
Bank
of America Corp.
|
7.250%
|
5,700
|
7,811,280
|
|
Wells
Fargo & Co.
|
7.500%
|
5,500
|
7,510,250
|
|
Total
|
|
|
15,321,530
|
|
Capital
Markets 0.7%
|
|
AMG
Capital Trust II
|
5.150%
|
130,000
|
6,276,331
|
|
Cowen,
Inc.
|
5.625%
|
5,200
|
4,711,127
|
|
Total
|
|
|
10,987,458
|
|
Insurance
0.3%
|
|
Assurant,
Inc.
|
6.500%
|
35,000
|
3,916,850
|
|
Total
Financials
|
30,225,838
|
|
Health
Care 1.7%
|
|
Health
Care Equipment & Supplies 1.0%
|
|
Becton
Dickinson and Co.
|
6.125%
|
130,000
|
8,066,385
|
|
Danaher
Corp.
|
4.750%
|
7,000
|
7,690,200
|
|
Total
|
|
|
15,756,585
|
|
Health
Care Technology 0.2%
|
|
Change
Healthcare, Inc.(f)
|
6.000%
|
75,000
|
4,166,250
|
|
Convertible
Preferred Stocks (continued)
|
|
Issuer
|
|
Shares
|
Value
($)
|
|
Life
Sciences Tools & Services 0.5%
|
|
Avantor,
Inc.
|
6.250%
|
120,000
|
7,890,660
|
|
Total
Health Care
|
27,813,495
|
|
Industrials
0.6%
|
|
Machinery
0.6%
|
|
Fortive
Corp.
|
5.000%
|
6,000
|
6,179,920
|
|
Rexnord
Corp.
|
5.750%
|
70,000
|
4,279,100
|
|
Total
|
|
|
10,459,020
|
|
Total
Industrials
|
10,459,020
|
|
Information
Technology 0.4%
|
|
Electronic
Equipment, Instruments & Components 0.4%
|
|
Belden,
Inc.
|
6.750%
|
73,636
|
5,806,935
|
|
Total
Information Technology
|
5,806,935
|
|
Real
Estate 0.4%
|
|
Equity
Real Estate Investment Trusts (REITS) 0.4%
|
|
Crown
Castle International Corp.
|
6.875%
|
5,300
|
6,337,612
|
|
Total
Real Estate
|
6,337,612
|
|
Utilities
2.0%
|
|
Electric
Utilities 0.5%
|
|
American
Electric Power Co., Inc.
|
6.125%
|
142,500
|
7,562,361
|
|
Multi-Utilities
1.3%
|
|
CenterPoint
Energy, Inc.
|
7.000%
|
155,000
|
7,792,745
|
|
Dominion
Energy, Inc.
|
7.250%
|
60,000
|
6,193,200
|
|
DTE
Energy Co.
|
6.500%
|
135,000
|
7,549,102
|
|
Total
|
|
|
21,535,047
|
|
Water
Utilities 0.2%
|
|
Aqua
America, Inc.
|
6.000%
|
72,500
|
4,136,524
|
|
Total
Utilities
|
33,233,932
|
Total
Convertible Preferred Stocks
(Cost $119,453,382)
|
121,211,879
|
|
Corporate
Bonds & Notes 14.6%
|
|
Issuer
|
Coupon
Rate
|
|
Principal
Amount ($)
|
Value
($)
|
|
Brokerage/Asset
Managers/Exchanges 0.5%
|
|
LPL
Holdings, Inc.(c)
|
|
09/15/2025
|
5.750%
|
|
7,850,000
|
8,083,490
|
The accompanying Notes to Portfolio of Investments are an integral
part of this statement.
|
8
|
Tri-Continental Corporation
| Semiannual Report 2019
|
Portfolio of Investments (continued)
June 30, 2019 (Unaudited)
|
Corporate
Bonds & Notes (continued)
|
|
Issuer
|
Coupon
Rate
|
|
Principal
Amount ($)
|
Value
($)
|
|
Cable
and Satellite 1.0%
|
|
Charter
Communications Operating LLC/Capital
|
|
10/23/2045
|
6.484%
|
|
7,200,000
|
8,562,060
|
|
Gogo
Intermediate Holdings LLC/Finance Co., Inc.(c)
|
|
05/01/2024
|
9.875%
|
|
2,000,000
|
2,052,814
|
|
Telesat
Canada/LLC(c)
|
|
11/15/2024
|
8.875%
|
|
5,360,000
|
5,813,944
|
|
Total
|
16,428,818
|
|
Chemicals
0.5%
|
|
Starfruit
Finco BV/US Holdco LLC(c)
|
|
10/01/2026
|
8.000%
|
|
7,900,000
|
8,128,918
|
|
Consumer
Products 0.5%
|
|
Mattel,
Inc.(c)
|
|
12/31/2025
|
6.750%
|
|
8,042,000
|
8,272,371
|
|
Electric
0.6%
|
|
Covanta
Holding Corp.
|
|
07/01/2025
|
5.875%
|
|
4,834,000
|
5,027,254
|
|
01/01/2027
|
6.000%
|
|
5,000,000
|
5,231,795
|
|
Total
|
10,259,049
|
|
Finance
Companies 1.4%
|
|
Fortress
Transportation & Infrastructure Investors LLC(c)
|
|
10/01/2025
|
6.500%
|
|
6,000,000
|
6,178,908
|
|
iStar,
Inc.
|
|
04/01/2022
|
6.000%
|
|
7,943,000
|
8,159,209
|
|
Springleaf
Finance Corp.
|
|
03/15/2025
|
6.875%
|
|
8,400,000
|
9,204,745
|
|
Total
|
23,542,862
|
|
Food
and Beverage 0.5%
|
|
Chobani
LLC/Finance Corp., Inc.(c)
|
|
04/15/2025
|
7.500%
|
|
4,597,000
|
4,300,240
|
|
Lamb
Weston Holdings, Inc.(c)
|
|
11/01/2026
|
4.875%
|
|
3,900,000
|
4,058,075
|
|
Total
|
8,358,315
|
|
Health
Care 0.6%
|
|
Quotient
Ltd.(c),(g),(h)
|
|
04/15/2024
|
12.000%
|
|
2,170,000
|
2,170,000
|
|
04/15/2024
|
12.000%
|
|
930,000
|
930,000
|
|
Surgery
Center Holdings, Inc.(c)
|
|
07/01/2025
|
6.750%
|
|
6,600,000
|
5,821,992
|
|
Total
|
8,921,992
|
|
Corporate
Bonds & Notes (continued)
|
|
Issuer
|
Coupon
Rate
|
|
Principal
Amount ($)
|
Value
($)
|
|
Healthcare
Insurance 0.4%
|
|
Centene
Corp.
|
|
01/15/2025
|
4.750%
|
|
6,646,000
|
6,858,446
|
|
Independent
Energy 0.9%
|
|
Indigo
Natural Resources LLC(c)
|
|
02/15/2026
|
6.875%
|
|
8,200,000
|
7,380,090
|
|
Talos
Production LLC/Finance, Inc.
|
|
04/03/2022
|
11.000%
|
|
6,136,177
|
6,481,337
|
|
Total
|
13,861,427
|
|
Lodging
0.2%
|
|
Marriott
Ownership Resorts, Inc./ILG LLC
|
|
09/15/2026
|
6.500%
|
|
3,732,000
|
4,002,570
|
|
Media
and Entertainment 0.7%
|
|
Lions
Gate Capital Holdings LLC(c)
|
|
11/01/2024
|
5.875%
|
|
7,550,000
|
7,767,893
|
|
Meredith
Corp.
|
|
02/01/2026
|
6.875%
|
|
3,700,000
|
3,932,478
|
|
Total
|
11,700,371
|
|
Metals
and Mining 1.0%
|
|
CONSOL
Energy, Inc.(c)
|
|
11/15/2025
|
11.000%
|
|
4,200,000
|
4,571,251
|
|
Constellium
NV(c)
|
|
03/01/2025
|
6.625%
|
|
7,900,000
|
8,231,508
|
|
Warrior
Met Coal, Inc.(c)
|
|
11/01/2024
|
8.000%
|
|
2,532,000
|
2,643,286
|
|
Total
|
15,446,045
|
|
Midstream
0.7%
|
|
Rockpoint
Gas Storage Canada Ltd.(c)
|
|
03/31/2023
|
7.000%
|
|
4,216,000
|
4,269,611
|
|
Summit
Midstream Partners LP(e)
|
|
Junior
Subordinated
|
|
12/31/2049
|
9.500%
|
|
8,400,000
|
7,585,032
|
|
Total
|
11,854,643
|
|
Oil
Field Services 0.2%
|
|
SESI
LLC
|
|
09/15/2024
|
7.750%
|
|
4,200,000
|
2,707,580
|
|
Other
Industry 0.5%
|
|
WeWork
Companies, Inc.(c)
|
|
05/01/2025
|
7.875%
|
|
8,700,000
|
8,591,624
|
|
Packaging
1.0%
|
|
BWAY
Holding Co.(c)
|
|
04/15/2025
|
7.250%
|
|
8,500,000
|
8,201,276
|
The accompanying Notes to Portfolio of Investments are an integral
part of this statement.
Tri-Continental
Corporation | Semiannual Report 2019
|
9
|
Portfolio of Investments (continued)
June 30, 2019 (Unaudited)
|
Corporate
Bonds & Notes (continued)
|
|
Issuer
|
Coupon
Rate
|
|
Principal
Amount ($)
|
Value
($)
|
|
Novolex
(c)
|
|
01/15/2025
|
6.875%
|
|
8,490,000
|
7,686,175
|
|
Total
|
15,887,451
|
|
Pharmaceuticals
0.7%
|
|
Bausch
Health Companies, Inc.(c)
|
|
01/31/2027
|
8.500%
|
|
7,400,000
|
8,146,986
|
|
Horizon
Pharma, Inc.(c)
|
|
11/01/2024
|
8.750%
|
|
3,700,000
|
3,980,323
|
|
Total
|
12,127,309
|
|
Restaurants
0.3%
|
|
IRB
Holding Corp.(c)
|
|
02/15/2026
|
6.750%
|
|
4,300,000
|
4,311,030
|
|
Retailers
0.1%
|
|
Rite
Aid Corp.
|
|
Junior
Subordinated
|
|
02/15/2027
|
7.700%
|
|
1,937,000
|
1,154,373
|
|
Supermarkets
0.5%
|
|
Safeway,
Inc.
|
|
02/01/2031
|
7.250%
|
|
7,512,000
|
7,420,819
|
|
Technology
0.9%
|
|
Diebold,
Inc.
|
|
04/15/2024
|
8.500%
|
|
8,100,000
|
7,255,170
|
|
Genesys
Telecommunications Laboratories, Inc./Greeneden Lux 3 Sarl/U.S. Holdings I LLC(c)
|
|
11/30/2024
|
10.000%
|
|
3,750,000
|
4,077,859
|
|
Informatica
LLC(c)
|
|
07/15/2023
|
7.125%
|
|
3,838,000
|
3,902,939
|
|
Total
|
15,235,968
|
|
Transportation
Services 0.6%
|
|
Hertz
Corp. (The)
|
|
10/15/2022
|
6.250%
|
|
5,700,000
|
5,754,486
|
|
Hertz
Corp. (The)(c)
|
|
10/15/2024
|
5.500%
|
|
4,000,000
|
3,823,768
|
|
Total
|
9,578,254
|
|
Wirelines
0.3%
|
|
Frontier
Communications Corp.
|
|
09/15/2025
|
11.000%
|
|
8,360,000
|
5,209,877
|
Total
Corporate Bonds & Notes
(Cost $240,584,132)
|
237,943,602
|
|
Limited
Partnerships 0.5%
|
|
Issuer
|
Shares
|
Value
($)
|
|
Energy
0.5%
|
|
Oil,
Gas & Consumable Fuels 0.5%
|
|
Enviva
Partners LP
|
125,000
|
3,927,500
|
|
Rattler
Midstream LP(a)
|
207,500
|
4,023,425
|
|
Total
|
|
7,950,925
|
|
Total
Energy
|
7,950,925
|
Total
Limited Partnerships
(Cost $6,975,625)
|
7,950,925
|
|
Preferred
Debt 0.6%
|
|
Issuer
|
Coupon
Rate
|
|
Shares
|
Value
($)
|
|
Banking
0.4%
|
|
Citigroup
Capital XIII(e)
|
|
10/30/2040
|
8.953%
|
|
215,000
|
5,931,850
|
|
Finance
Companies 0.2%
|
|
GMAC
Capital Trust I(e)
|
|
02/15/2040
|
8.303%
|
|
157,500
|
4,115,475
|
Total
Preferred Debt
(Cost $9,606,367)
|
10,047,325
|
|
Senior
Loans 0.4%
|
|
Borrower
|
Coupon
Rate
|
|
Principal
Amount ($)
|
Value
($)
|
|
Oil
Field Services 0.4%
|
|
BCP
Raptor LLC/EagleClaw Midstream Ventures(i),(j)
|
|
Term
Loan
|
3-month
USD LIBOR + 4.250%
Floor 1.000%
06/24/2024
|
6.652%
|
|
7,843,920
|
7,432,114
|
Total
Senior Loans
(Cost $7,781,831)
|
7,432,114
|
|
Warrants
—%
|
|
Issuer
|
Shares
|
Value
($)
|
|
Energy
—%
|
|
Oil,
Gas & Consumable Fuels —%
|
|
Goodrich
Petroleum Corp.(a),(g),(h),(k)
|
16,334
|
0
|
|
Total
Energy
|
0
|
Total
Warrants
(Cost $—)
|
0
|
|
|
The accompanying Notes to Portfolio of Investments are an integral
part of this statement.
|
10
|
Tri-Continental Corporation
| Semiannual Report 2019
|
Portfolio of Investments (continued)
June 30, 2019 (Unaudited)
|
Money
Market Funds 1.5%
|
|
|
Shares
|
Value
($)
|
|
Columbia
Short-Term Cash Fund, 2.433%(l),(m)
|
12,306,936
|
12,305,705
|
|
JPMorgan
U.S. Government Money Market Fund, Agency Shares, 2.179%(l)
|
11,522,018
|
11,522,018
|
Total
Money Market Funds
(Cost $23,827,723)
|
23,827,723
|
Total
Investments in Securities
(Cost: $1,515,759,595)
|
1,628,247,130
|
|
Other
Assets & Liabilities, Net
|
|
4,731,077
|
|
Net
Assets
|
1,632,978,207
|
At June 30, 2019, securities and/or cash totaling $858,636 were
pledged as collateral.
Investments in derivatives
|
Long
futures contracts
|
|
Description
|
Number
of
contracts
|
Expiration
date
|
Trading
currency
|
Notional
amount
|
Value/Unrealized
appreciation ($)
|
Value/Unrealized
depreciation ($)
|
|
S&P
500 E-mini
|
93
|
09/2019
|
USD
|
13,690,530
|
155,457
|
—
|
Notes to Portfolio of
Investments
|
(a)
|
Non-income
producing investment.
|
|
(b)
|
This
security or a portion of this security has been pledged as collateral in connection with derivative contracts.
|
|
(c)
|
Represents privately
placed and other securities and instruments exempt from Securities and Exchange Commission registration (collectively, private placements), such as Section 4(a)(2) and Rule 144A eligible securities, which are often sold only to qualified
institutional buyers. The Fund may invest in private placements determined to be liquid as well as those determined to be illiquid. Private placements may be determined to be liquid under guidelines established by the Fund’s Board of
Directors. At June 30, 2019, the total value of these securities amounted to $164,535,892, which represents 10.08% of total net assets.
|
|
(d)
|
Represents securities
that have defaulted on payment of interest. The Fund has stopped accruing interest on these securities. At June 30, 2019, the total value of these securities amounted to $4,271,305, which represents 0.26% of total net assets.
|
|
(e)
|
Represents a
variable rate security with a step coupon where the rate adjusts according to a schedule for a series of periods, typically lower for an initial period and then increasing to a higher coupon rate thereafter. The interest rate shown was the current
rate as of June 30, 2019.
|
|
(f)
|
Represents a
security purchased on a when-issued basis.
|
|
(g)
|
Represents fair
value as determined in good faith under procedures approved by the Board of Directors. At June 30, 2019, the total value of these securities amounted to $3,100,000, which represents 0.19% of total net assets.
|
|
(h)
|
Valuation
based on significant unobservable inputs.
|
|
(i)
|
The
stated interest rate represents the weighted average interest rate at June 30, 2019 of contracts within the senior loan facility. Interest rates on contracts are primarily determined either weekly, monthly or quarterly by reference to the indicated
base lending rate and spread and the reset period. These base lending rates are primarily the London Interbank Offered Rate (“LIBOR”) and other short-term rates. Base lending rates may be subject to a floor or minimum rate. The interest
rate for senior loans purchased on a when-issued or delayed delivery basis will be determined upon settlement, therefore no interest rate is disclosed. Senior loans often require prepayments from excess cash flows or permit the borrowers to repay at
their election. The degree to which borrowers repay, cannot be predicted with accuracy. As a result, remaining maturities of senior loans may be less than the stated maturities.
|
|
(j)
|
Variable
rate security. The interest rate shown was the current rate as of June 30, 2019.
|
|
(k)
|
Negligible market
value.
|
|
(l)
|
The rate
shown is the seven-day current annualized yield at June 30, 2019.
|
The accompanying Notes to Portfolio of Investments are an integral part of
this statement.
Tri-Continental
Corporation | Semiannual Report 2019
|
11
|
Portfolio of Investments (continued)
June 30, 2019 (Unaudited)
Notes to Portfolio of
Investments (continued)
|
(m)
|
As defined in
the Investment Company Act of 1940, an affiliated company is one in which the Fund owns 5% or more of the company’s outstanding voting securities, or a company which is under common ownership or control with the Fund. Holdings and transactions
in these affiliated companies during the period ended June 30, 2019 are as follows:
|
|
Issuer
|
Beginning
shares
|
Shares
purchased
|
Shares
sold
|
Ending
shares
|
Realized
gain
(loss) —
affiliated
issuers ($)
|
Net
change in
unrealized
appreciation
(depreciation) —
affiliated
issuers ($)
|
Dividends
—
affiliated
issuers ($)
|
Value
—
affiliated
issuers
at end of
period ($)
|
|
Columbia
Short-Term Cash Fund, 2.433%
|
|
|
25,992,417
|
45,329,935
|
(59,015,416)
|
12,306,936
|
92
|
—
|
102,893
|
12,305,705
|
Abbreviation Legend
|
ADR
|
American
Depositary Receipt
|
Currency
Legend
Fair value measurements
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 Fund’s assumptions about the information market participants would use in pricing an
investment. An investment’s level within the fair value hierarchy is based on the lowest level of any input that is deemed significant to the asset’s or liability’s 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. 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 Fund’s 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 Investment Manager, along with any other relevant factors in the calculation of an
investment’s 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.
Certain investments that have been measured at fair value using
the net asset value (NAV) per share (or its equivalent) are not categorized in the fair value hierarchy. The fair value amounts presented in the table are intended to reconcile the fair value hierarchy to the amounts presented in the Portfolio of
Investments. The Columbia Short-Term Cash Fund seeks to provide shareholders with maximum current income consistent with liquidity and stability of principal. Columbia Short-Term Cash Fund prices its shares with a floating NAV and no longer seeks to
maintain a stable NAV.
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 may rely on one or more significant unobservable inputs and/or significant assumptions by the
Investment Manager. 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.
Under the direction of the Fund’s Board of Directors (the
Board), the Investment Manager’s Valuation Committee (the Committee) is responsible for overseeing the valuation procedures approved by the Board. The Committee consists of voting and non-voting members from various groups within the
Investment Manager’s organization, including operations and accounting, trading and investments, compliance, risk management and legal.
The Committee meets at least monthly to review and approve
valuation matters, which may include a description of specific valuation determinations, data regarding pricing information received from approved pricing vendors and brokers and the results of Board-approved valuation control policies and
procedures (the Policies). The Policies address, among other things, instances when market quotations are or are not readily available, including recommendations of third party pricing vendors and a determination of appropriate pricing
methodologies; events that require specific valuation determinations and assessment of fair value techniques; securities with a potential for stale pricing, including those that are illiquid, restricted, or in default; and the effectiveness of third
party pricing vendors, including periodic reviews of vendors. The Committee meets more frequently, as needed, to discuss additional valuation matters, which may include the need to review back-testing results, review time-sensitive information or
approve related valuation actions. The Committee reports to the Board, with members of the Committee meeting with the Board at each of its regularly scheduled meetings to discuss valuation matters and actions during the period, similar to those
described earlier.
The accompanying Notes to Portfolio of Investments are an integral part of
this statement.
|
12
|
Tri-Continental Corporation
| Semiannual Report 2019
|
Portfolio of Investments (continued)
June 30, 2019 (Unaudited)
Fair value
measurements (continued)
For investments categorized as Level 3, the Committee monitors information similar to that described above, which may include: (i) data specific to the issuer or
comparable issuers, (ii) general market or specific sector news and (iii) quoted prices and specific or similar security transactions. The Committee considers this data and any changes from prior periods in order to assess the reasonableness of
observable and unobservable inputs, any assumptions or internal models used to value those securities and changes in fair value. This data is also used to corroborate, when available, information received from approved pricing vendors and brokers.
Various factors impact the frequency of monitoring this information (which may occur as often as daily). However, the Committee may determine that changes to inputs, assumptions and models are not required as a result of the monitoring procedures
performed.
The following table is a summary of the
inputs used to value the Fund’s investments at June 30, 2019:
|
|
Level
1
quoted prices
in active
markets for
identical
assets ($)
|
Level
2
other
significant
observable
inputs ($)
|
Level
3
significant
unobservable
inputs ($)
|
Investments
measured at
net asset
value ($)
|
Total
($)
|
|
Investments
in Securities
|
|
|
|
|
|
|
Common
Stocks
|
|
|
|
|
|
|
Communication
Services
|
96,568,937
|
—
|
—
|
—
|
96,568,937
|
|
Consumer
Discretionary
|
106,689,051
|
—
|
—
|
—
|
106,689,051
|
|
Consumer
Staples
|
81,967,476
|
—
|
—
|
—
|
81,967,476
|
|
Energy
|
58,075,347
|
—
|
—
|
—
|
58,075,347
|
|
Financials
|
161,479,918
|
—
|
—
|
—
|
161,479,918
|
|
Health
Care
|
152,200,540
|
—
|
—
|
—
|
152,200,540
|
|
Industrials
|
96,202,312
|
—
|
—
|
—
|
96,202,312
|
|
Information
Technology
|
240,029,506
|
—
|
—
|
—
|
240,029,506
|
|
Materials
|
28,667,093
|
—
|
—
|
—
|
28,667,093
|
|
Real
Estate
|
39,559,266
|
—
|
—
|
—
|
39,559,266
|
|
Utilities
|
34,053,402
|
—
|
—
|
—
|
34,053,402
|
|
Total
Common Stocks
|
1,095,492,848
|
—
|
—
|
—
|
1,095,492,848
|
|
Convertible
Bonds
|
—
|
124,340,714
|
—
|
—
|
124,340,714
|
|
Convertible
Preferred Stocks
|
|
|
|
|
|
|
Consumer
Staples
|
—
|
3,971,047
|
—
|
—
|
3,971,047
|
|
Energy
|
—
|
3,364,000
|
—
|
—
|
3,364,000
|
|
Financials
|
7,811,280
|
22,414,558
|
—
|
—
|
30,225,838
|
|
Health
Care
|
—
|
27,813,495
|
—
|
—
|
27,813,495
|
|
Industrials
|
—
|
10,459,020
|
—
|
—
|
10,459,020
|
|
Information
Technology
|
—
|
5,806,935
|
—
|
—
|
5,806,935
|
|
Real
Estate
|
—
|
6,337,612
|
—
|
—
|
6,337,612
|
|
Utilities
|
—
|
33,233,932
|
—
|
—
|
33,233,932
|
|
Total
Convertible Preferred Stocks
|
7,811,280
|
113,400,599
|
—
|
—
|
121,211,879
|
|
Corporate
Bonds & Notes
|
—
|
234,843,602
|
3,100,000
|
—
|
237,943,602
|
|
Limited
Partnerships
|
|
|
|
|
|
|
Energy
|
7,950,925
|
—
|
—
|
—
|
7,950,925
|
|
Preferred
Debt
|
10,047,325
|
—
|
—
|
—
|
10,047,325
|
|
Senior
Loans
|
—
|
7,432,114
|
—
|
—
|
7,432,114
|
|
Warrants
|
|
|
|
|
|
|
Energy
|
—
|
—
|
0*
|
—
|
0*
|
|
Money
Market Funds
|
11,522,018
|
—
|
—
|
12,305,705
|
23,827,723
|
|
Total
Investments in Securities
|
1,132,824,396
|
480,017,029
|
3,100,000
|
12,305,705
|
1,628,247,130
|
|
Investments
in Derivatives
|
|
|
|
|
|
|
Asset
|
|
|
|
|
|
|
Futures
Contracts
|
155,457
|
—
|
—
|
—
|
155,457
|
|
Total
|
1,132,979,853
|
480,017,029
|
3,100,000
|
12,305,705
|
1,628,402,587
|
See the Portfolio of
Investments for all investment classifications not indicated in the table.
The Fund’s assets assigned to the Level 2 input category
are generally valued using the market approach, in which a security’s value is determined through reference to prices and information from market transactions for similar or identical assets.
Derivative instruments are valued at unrealized appreciation
(depreciation).
The accompanying Notes to Portfolio of Investments are an integral part of
this statement.
Tri-Continental
Corporation | Semiannual Report 2019
|
13
|
Portfolio of Investments (continued)
June 30, 2019 (Unaudited)
Fair value
measurements (continued)
There were no transfers of financial assets between levels during the period.
The Fund does not hold any significant investments (greater than
one percent of net assets) categorized as Level 3.
The
Fund’s assets assigned to the Level 3 category are valued utilizing the valuation technique deemed the most appropriate in the circumstances.
Warrants classified as Level 3 are valued using an income
approach. To determine fair value for these securities, management considered estimates of future distributions from the liquidation of the company assets. Significant increases (decreases) to any of these inputs would result in a significantly
higher (lower) fair value measurement.
Certain corporate
bonds classified as Level 3 securities are valued using the market approach and utilize single market quotations from broker dealers which may have included, but were not limited to, observable transactions for identical or similar assets in the
market and the distressed nature of the security. The appropriateness of fair values for these securities is monitored on an ongoing basis which may include results of back testing, manual price reviews and other control procedures. Significant
increases (decreases) to any of these inputs would result in a significantly higher (lower) valuation measurement
The accompanying Notes to Portfolio of Investments are an integral part of
this statement.
|
14
|
Tri-Continental Corporation
| Semiannual Report 2019
|
Statement of Assets and Liabilities
June 30, 2019 (Unaudited)
|
Assets
|
|
|
Investments
in securities, at value
|
|
|
Unaffiliated
issuers (cost $1,503,453,890)
|
$1,615,941,425
|
|
Affiliated
issuers (cost $12,305,705)
|
12,305,705
|
|
Cash
|
8
|
|
Receivable
for:
|
|
|
Investments
sold
|
7,858,252
|
|
Dividends
|
2,863,332
|
|
Interest
|
6,460,701
|
|
Variation
margin for futures contracts
|
61,845
|
|
Other
assets
|
72,532
|
|
Total
assets
|
1,645,563,800
|
|
Liabilities
|
|
|
Payable
for:
|
|
|
Investments
purchased
|
11,839,377
|
|
Common
Stock payable
|
78,731
|
|
Preferred
Stock dividends
|
470,463
|
|
Management
services fees
|
18,215
|
|
Stockholder
servicing and transfer agent fees
|
9,752
|
|
Compensation
of board members
|
158,709
|
|
Compensation
of chief compliance officer
|
180
|
|
Other
expenses
|
10,166
|
|
Total
liabilities
|
12,585,593
|
|
Net
assets
|
$1,632,978,207
|
|
Preferred
Stock
|
37,637,000
|
|
Net
assets for Common Stock
|
1,595,341,207
|
|
Represented
by
|
|
|
$2.50
Cumulative Preferred Stock, $50 par value, assets coverage per share $2,169
|
|
|
Shares
issued and outstanding — 752,740
|
37,637,000
|
|
Common
Stock, $0.50 par value:
|
|
|
Shares
issued and outstanding — 53,122,805
|
26,561,403
|
|
Capital
surplus
|
1,425,504,111
|
|
Total
distributable earnings (loss)
|
143,275,693
|
|
Net
assets
|
$1,632,978,207
|
|
Net
asset value per share of outstanding Common Stock
|
$30.03
|
|
Market
price per share of Common Stock
|
$26.97
|
The accompanying Notes to Financial Statements are an integral part of this
statement.
Tri-Continental
Corporation | Semiannual Report 2019
|
15
|
Statement of Operations
Six Months Ended June 30, 2019 (Unaudited)
|
Net
investment income
|
|
|
Income:
|
|
|
Dividends
— unaffiliated issuers
|
$18,654,811
|
|
Dividends
— affiliated issuers
|
102,893
|
|
Interest
|
12,318,655
|
|
Foreign
taxes withheld
|
(23,562)
|
|
Total
income
|
31,052,797
|
|
Expenses:
|
|
|
Management
services fees
|
3,217,758
|
|
Stockholder
servicing and transfer agent fees
|
273,788
|
|
Compensation
of board members
|
28,755
|
|
Custodian
fees
|
11,144
|
|
Printing
and postage fees
|
47,105
|
|
Stockholders’
meeting fees
|
29,315
|
|
Audit
fees
|
26,843
|
|
Legal
fees
|
6,279
|
|
Compensation
of chief compliance officer
|
164
|
|
Other
|
107,914
|
|
Total
expenses
|
3,749,065
|
|
Net
investment income(a)
|
27,303,732
|
|
Realized
and unrealized gain (loss) — net
|
|
|
Net
realized gain (loss) on:
|
|
|
Investments
— unaffiliated issuers
|
34,235,353
|
|
Investments
— affiliated issuers
|
92
|
|
Foreign
currency translations
|
759
|
|
Futures
contracts
|
2,021,706
|
|
Net
realized gain
|
36,257,910
|
|
Net
change in unrealized appreciation (depreciation) on:
|
|
|
Investments
— unaffiliated issuers
|
152,940,811
|
|
Futures
contracts
|
(129,849)
|
|
Net
change in unrealized appreciation (depreciation)
|
152,810,962
|
|
Net
realized and unrealized gain
|
189,068,872
|
|
Net
increase in net assets resulting from operations
|
$216,372,604
|
|
(a)
|
Net
investment income for Common Stock is $26,362,807, which is net of Preferred Stock dividends of $940,925.
|
The accompanying Notes to Financial Statements are an integral part of this
statement.
|
16
|
Tri-Continental Corporation
| Semiannual Report 2019
|
Statement of Changes in Net Assets
|
|
Six
Months Ended
June 30, 2019
(Unaudited)
|
Year
Ended
December 31, 2018
|
|
Operations
|
|
|
|
Net
investment income
|
$27,303,732
|
$53,291,379
|
|
Net
realized gain
|
36,257,910
|
42,979,500
|
|
Net
change in unrealized appreciation (depreciation)
|
152,810,962
|
(169,722,076)
|
|
Net
increase (decrease) in net assets resulting from operations
|
216,372,604
|
(73,451,197)
|
|
Distributions
to stockholders
|
|
|
|
Net
investment income and net realized gains
|
|
|
|
Preferred
Stock
|
(940,925)
|
(1,881,850)
|
|
Common
Stock
|
(32,441,937)
|
(102,042,429)
|
|
Total
distributions to stockholders
|
(33,382,862)
|
(103,924,279)
|
|
Decrease
in net assets from capital stock activity
|
(18,859,748)
|
(28,966,569)
|
|
Total
increase (decrease) in net assets
|
164,129,994
|
(206,342,045)
|
|
Net
assets at beginning of period
|
1,468,848,213
|
1,675,190,258
|
|
Net
assets at end of period
|
$1,632,978,207
|
$1,468,848,213
|
|
|
Six
Months Ended
|
Year
Ended
|
|
|
June
30, 2019
|
December
31, 2018
|
|
|
Shares
|
Dollars
($)
|
Shares
|
Dollars
($)
|
|
Capital
stock activity
|
|
Common
Stock issued at market price in distributions
|
417,584
|
11,121,709
|
1,724,141
|
42,787,965
|
|
Common
Stock issued to cash purchase plan participants
|
17,872
|
463,003
|
48,611
|
1,303,543
|
|
Common
Stock purchased from cash purchase plan participants
|
(291,440)
|
(7,649,751)
|
(628,726)
|
(16,823,299)
|
|
Common
Stock purchased in the open market
|
(874,583)
|
(22,794,709)
|
(2,101,263)
|
(56,237,073)
|
|
Net
proceeds from issuance of shares of Common Stock upon exercise of warrants
|
—
|
—
|
2,467
|
2,295
|
|
Total
net decrease
|
(730,567)
|
(18,859,748)
|
(954,770)
|
(28,966,569)
|
The accompanying Notes to Financial Statements are an integral part of this
statement.
Tri-Continental
Corporation | Semiannual Report 2019
|
17
|
Per
share operating performance data is designed to allow investors to trace the operating performance, on a per Common Stock 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 Stock share amounts, using average Common Stock shares outstanding during the period.
Total return measures the Fund’s performance assuming
that investors purchased shares of the Fund at the market price or net asset value as of the beginning of the period, invested all distributions paid, as provided for in the Fund’s Prospectus and then sold their shares at the closing market
price or net asset value per share on the last day of the period. The computations do not reflect any sales commissions or transaction costs you may incur in purchasing or selling shares of the Fund, or taxes investors may incur on distributions or
on the sale of shares of the Fund, and are not annualized for periods of less than one year.
The portfolio turnover rate is calculated without regard to
purchase and sales transactions of short-term instruments and certain derivatives, if any, and is not annualized for periods of less than one year. If such transactions were included, the Fund’s portfolio turnover rate may be higher.
The ratios of expenses and net investment income to average
net assets for Common Stock for the periods presented do not reflect the effect of dividends paid to Preferred Stockholders.
|
|
Six
Months Ended
June 30, 2019
(Unaudited)
|
Year
ended December 31,
|
|
2018
|
2017
|
2016
|
2015
|
2014
|
|
Per
share data
|
|
|
|
|
|
|
|
Net
asset value, beginning of period
|
$26.58
|
$29.88
|
$25.91
|
$23.49
|
$24.76
|
$23.11
|
|
Income
from investment operations:
|
|
|
|
|
|
|
|
Net
investment income
|
0.51
|
0.99
|
0.93
|
0.90
|
0.81
|
0.73
|
|
Net
realized and unrealized gain (loss)
|
3.57
|
(2.35)
|
4.24
|
2.33
|
(1.37)
|
1.70
|
|
Total
from investment operations
|
4.08
|
(1.36)
|
5.17
|
3.23
|
(0.56)
|
2.43
|
|
Less
distributions to Stockholders from:
|
|
|
|
|
|
|
|
Net
investment income — Preferred Stock
|
(0.02)
|
(0.03)
|
(0.03)
|
(0.03)
|
(0.03)
|
(0.03)
|
|
Net
investment income — Common Stock
|
(0.50)
|
(0.96)
|
(1.07)
|
(0.91)
|
(0.81)
|
(0.75)
|
|
Net
realized gains — Common Stock
|
(0.11)
|
(0.95)
|
(0.10)
|
—
|
—
|
—
|
|
Total
distributions to Stockholders
|
(0.63)
|
(1.94)
|
(1.20)
|
(0.94)
|
(0.84)
|
(0.78)
|
|
Dilution
in net asset value from dividend reinvestment
|
—
|
—
|
—
|
(0.06)
|
(0.05)
|
—
|
|
Increase
resulting from share repurchases
|
—
|
—
|
—
|
0.19
|
0.18
|
—
|
|
Net
asset value, end of period
|
$30.03
|
$26.58
|
$29.88
|
$25.91
|
$23.49
|
$24.76
|
|
Adjusted
net asset value, end of period(a)
|
$29.93
|
$26.48
|
$29.77
|
$25.83
|
$23.42
|
$24.68
|
|
Market
price, end of period
|
$26.97
|
$23.52
|
$26.94
|
$22.05
|
$20.02
|
$21.41
|
|
Total
return
|
|
|
|
|
|
|
|
Based
upon net asset value
|
15.59%
|
(4.10%)
|
20.82%
|
15.25%
|
(1.36%)
|
11.09%
|
|
Based
upon market price
|
17.32%
|
(5.88%)
|
28.00%
|
15.08%
|
(2.78%)
|
11.11%
|
|
Ratios
to average net assets
|
|
|
|
|
|
|
|
Expenses
to average net assets for Common Stock(b)
|
0.49%
(c)
|
0.49%
|
0.49%
|
0.50%
|
0.50%
|
0.49%
|
|
Net
investment income to average net assets for Common Stock
|
3.44%
(c)
|
3.14%
|
3.21%
|
3.59%
|
3.16%
|
2.91%
|
|
Supplemental
data
|
|
|
|
|
|
|
|
Net
assets, end of period (000’s):
|
|
|
|
|
|
|
|
Common
Stock
|
$1,595,341
|
$1,431,211
|
$1,637,553
|
$1,470,843
|
$1,382,712
|
$1,511,285
|
|
Preferred
Stock
|
$37,637
|
$37,637
|
$37,637
|
$37,637
|
$37,637
|
$37,637
|
|
Total
net assets
|
$1,632,978
|
$1,468,848
|
$1,675,190
|
$1,508,480
|
$1,420,349
|
$1,548,922
|
|
Portfolio
turnover
|
30%
|
63%
|
95%
|
82%
|
76%
|
76%
|
|
Notes
to Financial Highlights
|
|
(a)
|
Assumes
the exercise of outstanding warrants.
|
|
(b)
|
In
addition to the fees and expenses that the Fund bears directly, the Fund indirectly bears a pro rata share of the fees and expenses of any other funds in which it invests. Such indirect expenses are not included in the Fund’s reported expense
ratios.
|
|
(c)
|
Annualized.
|
The accompanying Notes to Financial Statements are an integral part of this
statement.
|
18
|
Tri-Continental Corporation
| Semiannual Report 2019
|
Notes to Financial Statements
June 30, 2019 (Unaudited)
Note 1. Organization
Tri-Continental Corporation (the Fund) is a 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 has 1 million authorized shares of preferred capital
stock (Preferred Stock) and 159 million authorized shares of common stock (Common Stock). The issued and outstanding Common Stock trades primarily on the New York Stock Exchange under the symbol "TY".
The Fund’s Preferred Stock is entitled to two votes per
share and the Common Stock is entitled to one vote per share at all meetings of Stockholders. In the event of a default in payments of dividends on the Preferred Stock equivalent to six quarterly dividends, the holders of the Fund’s Preferred
Stock (Preferred Stockholders) are entitled, voting separately as a class to the exclusion of the holders of the Fund’s Common Stock (Common Stockholders), to elect two additional directors, with such right to continue until all arrearages
have been paid and current Preferred Stock dividends are provided for. Generally, the vote of Preferred Stockholders is required to approve certain actions adversely affecting their rights.
Note 2. Summary of significant accounting
policies
Basis of preparation
The Fund is an investment company that applies the accounting
and reporting guidance in the Financial Accounting Standards Board (FASB) Accounting Standards Codification Topic 946, Financial Services - Investment Companies (ASC 946). The financial statements are prepared
in accordance with U.S. generally accepted accounting principles (GAAP), which 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 income and expenses during the reporting period. Actual results could differ from those estimates.
The following is a summary of significant accounting policies
followed by the Fund in the preparation of its financial statements.
Security valuation
All equity securities are valued at the close of business of
the New York Stock Exchange. 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 ask prices on such exchanges or markets.
Debt securities generally are valued by pricing services
approved by the Board of Directors based upon market transactions for normal, institutional-size trading units of similar securities. The services may use various pricing techniques that take into account, as applicable, factors such as yield,
quality, coupon rate, maturity, type of issue, trading characteristics and other data, as well as approved independent broker-dealer quotes. Debt securities for which quotations are not readily available or not believed to be reflective of market
value may also be valued based upon a bid quote from an approved independent broker-dealer. Debt securities maturing in 60 days or less are valued primarily at amortized cost value, unless this method results in a valuation that management believes
does not approximate market value.
Senior loan
securities for which reliable market quotations are readily available are generally valued by pricing services at the average of the bids received.
Foreign equity securities are valued based on the closing
price on the foreign exchange in which such securities are primarily traded. If any foreign equity security closing prices are not readily available, the securities are valued at the mean of the latest quoted bid and ask prices on such exchanges or
markets. Foreign currency exchange rates are generally determined at 4:00 p.m. Eastern (U.S.) time. Many securities markets and exchanges outside the U.S. close prior to the close of the New York Stock Exchange; 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 New York Stock Exchange. In those situations, foreign securities will be fair valued pursuant to a policy adopted by
the Board of Directors, including, if available, utilizing a third party pricing service to determine these fair values. The third party pricing service takes into account multiple factors,
Tri-Continental
Corporation | Semiannual Report 2019
|
19
|
Notes to Financial Statements (continued)
June 30, 2019 (Unaudited)
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 or market, to determine a good faith estimate that
reasonably reflects the current market conditions as of the close of the New York Stock Exchange. The fair value of a security is likely to be different from the quoted or published price, if available.
Investments in open-end investment companies, including money
market funds, are valued at their latest net asset value.
Futures and options on futures contracts are valued based upon
the settlement price at the close of regular trading on their principal exchanges or, in the absence of transactions, at the mean of the latest quoted bid and ask prices.
Investments for which market quotations are not readily
available, or that have quotations which management believes are not reflective of market value or reliable, are valued at fair value as determined in good faith under procedures approved by and under the general supervision of the Board of
Directors. 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 quoted or published 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 fair value.
GAAP requires 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. This information is disclosed following the Fund’s Portfolio of Investments.
Foreign currency transactions and translations
The values of all assets and liabilities denominated in
foreign currencies are generally translated into U.S. dollars at exchange rates determined at the close of regular trading on the New York Stock Exchange. 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 invests in certain derivative instruments, as
detailed below, to meet its investment objectives. Derivatives are instruments whose values depend on, or are derived from, in whole or in part, the value of one or more securities, currencies, commodities, indices, or other assets or instruments.
Derivatives may be used to increase investment flexibility (including to maintain cash reserves while maintaining desired exposure to certain assets), for risk management (hedging) purposes, to facilitate trading, to reduce transaction costs and to
pursue higher investment returns. The Fund may also use derivative instruments to mitigate certain investment risks, such as foreign currency exchange rate risk, interest rate risk and credit risk. Derivatives may involve various risks, including
the potential inability of the counterparty to fulfill its obligations under the terms of the contract, the potential for an illiquid secondary market (making it difficult for the Fund to sell or terminate, including at favorable prices) and the
potential for market movements which may expose the Fund to gains or losses in excess of the amount shown in the Statement of Assets and Liabilities. The notional amounts of derivative instruments, if applicable, are not recorded in the financial
statements.
A derivative instrument may suffer a
marked-to-market loss if the value of the contract decreases due to an unfavorable change in the market rates or values of the underlying instrument. Losses can also occur if the counterparty does not perform its obligations under the contract. The
Fund’s risk of loss from counterparty credit risk on over-the-counter derivatives is generally limited to the aggregate unrealized gain netted against any collateral held by the Fund and the amount of any variation margin held by the
counterparty, plus any replacement costs or related amounts. With exchange-traded or centrally cleared derivatives, there is reduced counterparty credit risk to the Fund since the clearinghouse or central counterparty
|
20
|
Tri-Continental Corporation
| Semiannual Report 2019
|
Notes to Financial Statements (continued)
June 30, 2019 (Unaudited)
(CCP) provides some
protection in the case of clearing member default. The clearinghouse or CCP stands between the buyer and the seller of the contract; therefore, additional counterparty credit risk is failure of the clearinghouse or CCP. However, credit risk still
exists in exchange-traded or centrally cleared derivatives with respect to initial and variation margin that is held in a broker’s customer account. While brokers are required to segregate customer margin from their own assets, in the event
that a broker becomes insolvent or goes into bankruptcy and at that time there is a shortfall in the aggregate amount of margin held by the broker for all its clients, U.S. bankruptcy laws will typically allocate that shortfall on a pro-rata basis
across all the broker’s customers (including the Fund), potentially resulting in losses to the Fund.
In order to better define its contractual rights and to secure
rights that will help the Fund mitigate its counterparty risk, the Fund may enter into an International Swaps and Derivatives Association, Inc. Master Agreement (ISDA Master Agreement) or similar agreement with its derivatives contract
counterparties. An ISDA Master Agreement is an agreement between the Fund and a counterparty that governs over-the-counter derivatives and typically contains, among other things, collateral posting terms and netting provisions in the event of a
default and/or termination event. Under an ISDA Master Agreement, the Fund may, under certain circumstances, offset with the counterparty certain derivative instrument’s payables and/or receivables with collateral held and/or posted and create
one single net payment. The provisions of the ISDA Master Agreement typically permit a single net payment in the event of default (close-out netting), including the bankruptcy or insolvency of the counterparty. Note, however, that bankruptcy or
insolvency laws of a particular jurisdiction may impose restrictions on or prohibitions against the right of offset or netting in bankruptcy, insolvency or other events.
Collateral (margin) requirements differ by type of derivative.
Margin requirements are established by the clearinghouse or CCP for exchange-traded and centrally cleared derivatives. Brokers can ask for margin in excess of the minimum in certain circumstances. Collateral terms are contract specific for
over-the-counter derivatives. For over-the-counter derivatives traded under an ISDA Master Agreement, the collateral requirements are typically calculated by netting the marked-to-market amount for each transaction under such agreement and comparing
that amount to the value of any variation margin currently pledged by the Fund and/or the counterparty. Generally, the amount of collateral due from or to a party has to exceed a minimum transfer amount threshold (e.g., $250,000) before a transfer
has to be made. To the extent amounts due to the Fund from its counterparties are not fully collateralized, contractually or otherwise, the Fund bears the risk of loss from counterparty nonperformance. The Fund may also pay interest expense on cash
collateral received from the broker. Any interest expense paid by the Fund is shown on the Statement of Operations. The Fund attempts to mitigate counterparty risk by only entering into agreements with counterparties that it believes have the
financial resources to honor their obligations and by monitoring the financial stability of those counterparties.
Certain ISDA Master Agreements allow counterparties of
over-the-counter derivatives transactions to terminate derivatives contracts prior to maturity in the event the Fund’s net asset value declines by a stated percentage over a specified time period or if the Fund fails to meet certain terms of
the ISDA Master Agreement, which would cause the Fund to accelerate payment of any net liability owed to the counterparty. The Fund also has termination rights if the counterparty fails to meet certain terms of the ISDA Master Agreement. In
determining whether to exercise such termination rights, the Fund would consider, in addition to counterparty credit risk, whether termination would result in a net liability owed from the counterparty.
For financial reporting purposes, the Fund does not offset
derivative assets and derivative liabilities that are subject to netting arrangements in the Statement of Assets and Liabilities.
Futures contracts
Futures contracts are exchange-traded and represent
commitments for the future purchase or sale of an asset at a specified price on a specified date. The Fund bought and sold futures contracts to maintain appropriate equity market exposure while keeping sufficient cash to accommodate daily
redemptions. These instruments may be used for other purposes in future periods. Upon entering into futures contracts, the Fund bears risks that it may not achieve the anticipated benefits of the futures contracts and may realize a loss. Additional
risks include counterparty credit risk, the possibility of an illiquid market, and that a change in the value of the contract or option may not correlate with changes in the value of the underlying asset.
Upon entering into a futures contract, the Fund deposits cash
or securities with the broker, known as a futures commission merchant (FCM), in an amount sufficient to meet the initial margin requirement. The initial margin deposit must be maintained at an established level over the life of the contract. Cash
deposited as initial margin is recorded in the Statement of Assets and Liabilities as margin deposits. Securities deposited as initial margin are designated in the Portfolio of Investments.
Tri-Continental
Corporation | Semiannual Report 2019
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21
|
Notes to Financial Statements (continued)
June 30, 2019 (Unaudited)
Subsequent payments
(variation margin) are made or received by the Fund each day. The variation margin payments are equal to the daily change in the contract value and are recorded as variation margin receivable or payable and are offset in unrealized gains or losses.
The Fund recognizes a realized gain or loss when the contract is closed or expires. Futures contracts involve, to varying degrees, risk of loss in excess of the variation margin disclosed in the Statement of Assets and Liabilities.
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; and the
impact of derivative transactions over the period in the Statement of Operations, including realized and unrealized gains (losses). The derivative instrument schedules following the Portfolio of Investments present additional information regarding
derivative instruments outstanding at the end of the period, if any.
The following table is a summary of the fair value of
derivative instruments (not considered to be hedging instruments for accounting disclosure purposes) at June 30, 2019:
|
|
Asset
derivatives
|
|
Risk
exposure
category
|
Statement
of assets and liabilities
location
|
Fair
value ($)
|
|
Equity
risk
|
Component
of total distributable earnings (loss) — unrealized appreciation on futures contracts
|
155,457*
|
|
*
|
Includes
cumulative appreciation (depreciation) as reported in the tables following the Portfolio of Investments. Only the current day’s variation margin is reported in receivables or payables in the Statement of Assets and Liabilities.
|
The following table indicates the
effect of derivative instruments (not considered to be hedging instruments for accounting disclosure purposes) in the Statement of Operations for the six months ended June 30, 2019:
|
Amount
of realized gain (loss) on derivatives recognized in income
|
|
Risk
exposure category
|
Futures
contracts
($)
|
|
Equity
risk
|
2,021,706
|
|
|
|
Change
in unrealized appreciation (depreciation) on derivatives recognized in income
|
|
Risk
exposure category
|
Futures
contracts
($)
|
|
Equity
risk
|
(129,849)
|
The following table is a summary
of the average outstanding volume by derivative instrument for the six months ended June 30, 2019:
|
Derivative
instrument
|
Average
notional
amounts ($)*
|
|
Futures
contracts — long
|
10,676,295
|
|
*
|
Based on
the ending quarterly outstanding amounts for the six months ended June 30, 2019.
|
Investments in senior loans
The Fund may invest in senior loan assignments. When the Fund
purchases an assignment of a senior loan, the Fund typically has direct rights against the borrower; provided, however, that the Fund’s rights may be more limited than the lender from which it acquired the assignment and the Fund may be able
to enforce its rights only through an administrative agent. Although certain senior loan assignments are secured by collateral, the Fund could experience delays or limitations in realizing such collateral or have its interest subordinated to other
indebtedness of the obligor. In the event that the administrator or collateral agent of a loan becomes insolvent or enters into receivership or bankruptcy, the Fund may incur costs and delays in realizing payment or may suffer a loss of principal
and/or interest. The risk of loss is greater for
|
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Tri-Continental Corporation
| Semiannual Report 2019
|
Notes to Financial Statements (continued)
June 30, 2019 (Unaudited)
unsecured or
subordinated loans. In addition, senior loan assignments are vulnerable to market, economic or other conditions or events that may reduce the demand for senior loan assignments and certain senior loan assignments which were liquid when purchased,
may become illiquid.
The Fund may enter into senior loan
assignments where all or a portion of the loan may be unfunded. The Fund is obligated to fund these commitments at the borrower’s discretion. These commitments, if any, are generally traded and priced in the same manner as other senior loan
securities and are disclosed as unfunded senior loan commitments in the Fund’s Portfolio of Investments with a corresponding payable for investments purchased. The Fund designates cash or liquid securities to cover these commitments.
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.
The trade date for senior loans purchased in the primary
market is the date on which the loan is allocated. The trade date for senior loans purchased in the secondary market is the date on which the transaction is entered into.
Income recognition
Interest income is recorded on an accrual basis. Market
premiums and discounts, including original issue discounts, are amortized and accreted, respectively, over the expected life of the security on all debt securities, unless otherwise noted.
The Fund may place a debt security on non-accrual status and
reduce related interest income when it becomes probable that the interest will not be collected and the amount of uncollectible interest can be reasonably estimated. A defaulted debt security is removed from non-accrual status when the issuer
resumes interest payments or when collectibility of interest is reasonably assured.
Corporate actions and dividend income are generally 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.
The Fund may receive distributions from holdings in equity
securities, business development companies (BDCs), exchange-traded funds (ETFs), limited partnerships (LPs), other regulated investment companies (RICs), and real estate investment trusts (REITs), which report information on the tax character of
their distributions annually. These distributions are allocated to dividend income, capital gain and return of capital based on actual information reported. Return of capital is recorded as a reduction of the cost basis of securities held. If the
Fund no longer owns the applicable securities, return of capital is recorded as a realized gain. With respect to REITs, to the extent actual information has not yet been reported, estimates for return of capital are made by the Fund’s
management. Management’s estimates are subsequently adjusted when the actual character of the distributions is disclosed by the REITs, which could result in a proportionate change in return of capital to stockholders.
The Fund may receive other income from senior loans, including
amendment fees, consent fees and commitment fees. These fees are recorded as income when received by the Fund. These amounts are included in Interest Income in the Statement of Operations.
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 investment company taxable income and net capital gain, 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 ordinary income, capital gain net income 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.
Tri-Continental
Corporation | Semiannual Report 2019
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23
|
Notes to Financial Statements (continued)
June 30, 2019 (Unaudited)
Foreign taxes
The Fund may be subject to foreign taxes on income, gains on
investments 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.
Realized gains in certain countries may be
subject to foreign taxes at the Fund level, based on statutory rates. The Fund accrues for such foreign taxes on realized and unrealized gains at the appropriate rate for each jurisdiction, as applicable. The amount, if any, is disclosed as a
liability on the Statement of Assets and Liabilities.
Distributions to stockholders
The Fund has an earned distribution policy. Under this policy,
the Fund intends to make quarterly distributions to holders of Common Stock that are approximately equal to net investment income, less dividends payable on the Fund’s Preferred Stock. Capital gains, when available, are distributed to Common
Stockholders at least annually.
Dividends and other
distributions to stockholders are recorded on ex-dividend dates.
Guarantees and indemnifications
Under the Fund’s 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 Fund’s contracts with its service providers contain general
indemnification clauses. The Fund’s 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.
Recent accounting
pronouncement
Accounting Standards Update 2018-13
Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement
In August 2018, the Financial Accounting Standards Board
issued Accounting Standards Update (ASU) No. 2018-13 Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement. ASU No. 2018-13, in addition to other modifications and additions, removes the requirement to disclose the
amount and reasons for transfers between Level 1 and Level 2 of the fair value hierarchy and the policy for the timing of transfers between levels. The standard is effective for annual periods beginning after December 15, 2019 and interim periods
within those fiscal years. At this time, management is evaluating the implication of this guidance and the impact it will have on the financial statement disclosures, if any.
Note 3. Fees and other transactions with
affiliates
Management services fees
The Fund has entered into a Management Agreement with Columbia
Management Investment Advisers, LLC (the Investment Manager), a wholly-owned subsidiary of Ameriprise Financial, Inc. (Ameriprise Financial). Under the Management Agreement, the Investment Manager provides the Fund with investment research and
advice, as well as administrative and accounting services. The management services fee is an annual fee that is equal to a percentage of the Fund’s daily net assets (which includes assets attributed to the Fund’s Common and Preferred
Stock) that declines from 0.415% to 0.385% as the Fund’s net assets increase and it is borne by the holders of the Fund’s Common Stock. The annualized effective management services fee rate for the six months ended June 30, 2019 was
0.42% of the Fund’s average daily net assets for Common Stock, paid by Common Stockholders (and 0.41% of the Fund’s total average daily net assets).
Compensation of board members
Members of the Board of Directors who are not officers or
employees of the Investment Manager or Ameriprise Financial are compensated for their services to the Fund as disclosed in the Statement of Operations. Under a Deferred Compensation Plan (the Deferred Plan), these members of the Board of Directors
may elect to defer payment of up to 100% of their compensation. Deferred amounts are treated as though equivalent dollar amounts had been invested in shares of certain
|
24
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Tri-Continental Corporation
| Semiannual Report 2019
|
Notes to Financial Statements (continued)
June 30, 2019 (Unaudited)
funds managed by
the Investment Manager. The Fund’s liability for these amounts is adjusted for market value changes and remains in the Fund until distributed in accordance with the Deferred Plan. All amounts payable under the Deferred Plan constitute a
general unsecured obligation of the Fund.
Compensation of
Chief Compliance Officer
The Board of Directors has
appointed a Chief Compliance Officer to the Fund in accordance with federal securities regulations. As disclosed in the Statement of Operations, a portion of the Chief Compliance Officer’s total compensation is allocated to the Fund, along
with other allocations to affiliated registered investment companies managed by the Investment Manager and its affiliates, based on relative net assets.
Stockholder servicing fees
Under a Stockholder Service Agent Agreement, Columbia
Management Investment Services Corp. (the Servicing Agent), an affiliate of the Investment Manager and a wholly-owned subsidiary of Ameriprise Financial, maintains Fund stockholder accounts and records and provides Fund stockholder services. Under
the Stockholder Service Agent Agreement, the Fund pays the Servicing Agent a monthly stockholder servicing and transfer agent fee based on the number of common stock open accounts. The Servicing Agent is also entitled to reimbursement for
out-of-pocket fees.
For the six months ended June 30,
2019, the Fund’s annualized effective stockholder servicing and transfer agent fee rate as a percentage of common stock average net assets was 0.04%.
The Fund and certain other affiliated investment companies
(together, the Guarantors) have severally, but not jointly, guaranteed the performance and observance of all the terms and conditions of a lease entered into by Seligman Data Corp. (SDC), including the payment of rent by SDC (the Guaranty). SDC was
the legacy Seligman funds’ former transfer agent. The lease and the Guaranty expired on January 31, 2019. SDC is owned by six associated investment companies, including the Fund. The Fund’s ownership interest in SDC at June 30, 2019 is
recorded as a part of other assets in the Statement of Assets and Liabilities at a cost of $43,681, which approximates the fair value of the ownership interest.
Note 4. Federal tax information
The timing and character of income and capital gain
distributions are determined in accordance with income tax regulations, which may differ from GAAP because of temporary or permanent book to tax differences.
At June 30, 2019, the approximate cost of all investments for
federal income tax purposes and the aggregate gross approximate unrealized appreciation and depreciation based on that cost was:
Federal
tax cost ($)
|
Gross
unrealized
appreciation ($)
|
Gross
unrealized
(depreciation) ($)
|
Net
unrealized
appreciation ($)
|
|
1,515,760,000
|
174,307,000
|
(61,664,000)
|
112,643,000
|
Tax cost of investments and
unrealized appreciation/(depreciation) may also include timing differences that do not constitute adjustments to tax basis.
Management of the Fund has concluded that there are no
significant uncertain tax positions in the Fund that would require recognition in the financial statements. However, management’s 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 Fund’s federal tax returns for the prior three fiscal years remain subject to examination by the Internal Revenue
Service.
Note 5. Portfolio information
The cost of purchases and proceeds from sales of securities,
excluding short-term investments and derivatives, if any, aggregated to $467,939,061 and $482,897,456, respectively, for the six months ended June 30, 2019. The amount of purchase and sale activity impacts the portfolio turnover rate reported in the
Financial Highlights.
Tri-Continental
Corporation | Semiannual Report 2019
|
25
|
Notes to Financial Statements (continued)
June 30, 2019 (Unaudited)
Note 6. Capital stock transactions
Under the Fund’s Charter, dividends on Common Stock
cannot be declared unless net assets, after deducting the amount of such dividends and all unpaid dividends declared on Preferred Stock, equal at least $100 per share of Preferred Stock outstanding. The Preferred Stock is subject to redemption at
the Fund’s option at any time on 30 days’ notice at $55 per share (or a total of $41,400,700 for the shares outstanding at June 30, 2019) plus accrued dividends, and entitled in liquidation to $50 per share plus dividends accrued or in
arrears, as the case may be.
Automatic Dividend Investment
Plan and Cash Purchase Plan
The Fund makes available the
Automatic Dividend Investment Plan and the Cash Purchase Plan (collectively, the Investment Plans) to any Common Stockholder with a Direct-at-Fund Account (as defined below) who wishes to purchase additional shares of the Fund. Please refer to the
Fund’s prospectus for a detailed discussion of the Investment Plans.
The Fund, in connection with its Investment Plans, acquires
and issues shares of its own Common Stock, as needed, to satisfy the requirements of the Investment Plans. A total of 17,872 shares were issued to the participants of the Cash Purchase Plan during the period for proceeds of $463,003, a weighted
average discount of 10.70% from the NAV of those shares. In addition, a total of 417,584 shares were issued at market price in distributions during the period for proceeds of $11,121,709, a weighted average discount of 10.14% from the NAV of those
shares.
For stockholder accounts established directly
with the Fund (i.e., Direct-at-Fund Accounts, which are serviced by the Servicing Agent), unless the Servicing Agent is otherwise instructed by the stockholder, distributions on the Common Stock are paid in book shares of Common Stock which are
entered in the stockholder’s account as “book credits.” Each stockholder may also elect to receive distributions 75% in shares and 25% in cash, 50% in shares and 50% in cash, or 100% in cash. Any such election must be received by
the Servicing Agent by the record date for a distribution. If the stockholder holds shares of Common Stock through a financial intermediary (such as a broker), the stockholder should contact the financial intermediary to discuss reinvestment and
distribution options, as they may be different than as described above for accounts held directly with the Fund. A distribution is treated in the same manner for income tax purposes whether you receive it in cash or partly or entirely in shares.
Elections received after a record date for a distribution will be effective in respect of the next distribution. Shares issued to the stockholder in respect of distributions will be at a price equal to the lower of: (i) the closing sale or bid
price, plus applicable commission, of the Common Stock on the New York Stock Exchange on the ex-dividend date or (ii) the greater of NAV per share of Common Stock and 95% of the closing price of the Common Stock on the New York Stock Exchange on the
ex-dividend date (without adjustment for the exercise of Warrants remaining outstanding). The issuance of Common Stock at less than NAV per share will dilute the NAV of all Common Stock outstanding at that time.
For the six months ended June 30, 2019, the Fund purchased
291,440 shares of its Common Stock from the Cash Purchase Plan participants at a cost of $7,649,751, which represented a weighted average discount of 10.65% from the NAV of those acquired shares.
Under the Fund’s stock repurchase program, the Fund
repurchases up to 5% of the Fund’s outstanding Common Stock during the year directly from Stockholders and in the open market, provided that, with respect to shares purchased in the open market, the excess of the NAV of a share of Common Stock
over its market price (the discount) is greater than 10%. The intent of the stock repurchase program is, among other things, to moderate the growth in the number of shares of Common Stock outstanding, increase the NAV of the Fund’s outstanding
shares, reduce the dilutive impact on stockholders who do not take capital gain distributions in additional shares, and increase the liquidity of the Fund’s Common Stock in the marketplace. For the six months ended June 30, 2019, the Fund
purchased 874,583 shares of its Common Stock in the open market at an aggregate cost of $22,794,709, which represented a weighted average discount of 10.71% from the NAV of those acquired shares.
Shares of Common Stock repurchased to satisfy the Plan
requirements or in the open market pursuant to the Fund’s stock repurchase program are no longer outstanding.
Warrants
At June 30, 2019, the Fund reserved 194,560 shares of Common
Stock for issuance upon exercise of 8,043 Warrants, each of which entitled the holder to purchase 24.19 shares of Common Stock at $0.93 per share.
|
26
|
Tri-Continental Corporation
| Semiannual Report 2019
|
Notes to Financial Statements (continued)
June 30, 2019 (Unaudited)
Assuming the exercise of all Warrants outstanding at June 30,
2019, net assets would have increased by $180,941 and the net asset value of the Common Stock would have been $29.93 per share. The number of Warrants exercised during the six months ended June 30, 2019 was zero.
Note 7. Affiliated money market fund
The Fund invests in Columbia Short-Term Cash Fund, an
affiliated money market fund established for the exclusive use by the Fund and other affiliated funds (the Affiliated MMF). The income earned by the Fund from such investments is included as Dividends - affiliated issuers in the Statement of
Operations. As an investing fund, the Fund indirectly bears its proportionate share of the expenses of the Affiliated MMF. The Affiliated MMF prices its shares with a floating net asset value. In addition, the Board of Directors of the Affiliated
MMF may impose a fee on redemptions (sometimes referred to as a liquidity fee) or temporarily suspend redemptions (sometimes referred to as imposing a redemption gate) in the event its liquidity falls below regulatory limits.
Note 8. Interfund Lending
Pursuant to an exemptive order granted by the Securities and
Exchange Commission, the Fund entered into a master interfund lending agreement (the Interfund Program) with certain other funds advised by the Investment Manager or its affiliates (each a Participating Fund). The Interfund Program allows each
Participating Fund to lend money directly to and, other than closed-end funds (including the Fund) and money market funds, borrow money directly from other Participating Funds for temporary purposes through the Interfund Program (each an Interfund
Loan).
A Participating Fund may make unsecured
borrowings under the Interfund Program if its outstanding borrowings from all sources, including those outside of the Interfund Program, immediately after such unsecured borrowing under the Interfund Program are equal to or less than 10% of its
total assets, provided that if the borrowing Participating Fund has a secured loan outstanding from any other lender, including but not limited to another Participating Fund, the borrowing Participating Fund’s borrowing under the Interfund
Program will be secured on at least an equal priority basis with at least an equivalent percentage of collateral to loan value as any outstanding loan that requires collateral. A Participating Fund may not borrow through the Interfund Program or
from any other source if its total outstanding borrowings immediately after a borrowing would be more than 33 1/3% of its total assets or any lower threshold provided for by a Participating Fund’s fundamental or non-fundamental policy
restriction.
No Participating Fund may lend to another
Participating Fund through the Interfund Program if the loan would cause the lending Participating Fund’s aggregate outstanding loans under the Interfund Program to exceed 15% of its current net assets at the time of the loan. A Participating
Fund’s Interfund Loans to any one Participating Fund may not exceed 5% of the lending Participating Fund’s net assets at the time of the loan. The duration of Interfund Loans will be limited to the time required to receive payment for
securities sold, but in no event more than seven days. Interfund Loans effected within seven days of each other will be treated as separate loan transactions for purposes of this limitation. Each Interfund Loan may be called on one business
day’s notice by a lending Participating Fund and may be repaid on any day by a borrowing Participating Fund.
Loans under the Interfund Program are subject to the risk that
the borrowing Participating Fund could be unable to repay the loan when due, and a delay in repayment to the lending Participating Fund could result in a lost opportunity by the lending Participating Fund to invest those loaned assets and additional
lending costs. Because the Investment Manager provides investment management services to both borrowing and lending Participating Funds, the Investment Manager may have a potential conflict of interest in determining that an Interfund Loan is
comparable in credit quality to other high-quality money market instruments. The Participating Fund has adopted policies and procedures that are designed to manage potential conflicts of interest, but the administration of the Interfund Program may
be subject to such conflicts.
As noted above, the Fund
may only participate in the Interfund Program as a Lending Fund. The Fund did not lend money under the Interfund Program during the six months ended June 30, 2019.
Tri-Continental
Corporation | Semiannual Report 2019
|
27
|
Notes to Financial Statements (continued)
June 30, 2019 (Unaudited)
Note 9. Significant risks
Credit risk
Credit risk is the risk that the value of debt securities in
the Fund’s portfolio may decline because the issuer may default and fail to pay interest or repay principal when due. Rating agencies assign credit ratings to debt securities to indicate their credit risk. Lower rated or unrated debt
securities held by the Fund may present increased credit risk as compared to higher-rated debt securities.
Interest rate risk
Interest rate risk is the risk of losses attributable to
changes in interest rates. In general, if prevailing interest rates rise, the values of debt securities tend to fall, and if interest rates fall, the values of debt securities tend to rise. Actions by governments and central banking authorities can
result in increases in interest rates. Increasing interest rates may negatively affect the value of debt securities held by the Fund, resulting in a negative impact on the Fund’s performance and net asset value per share. In general, the
longer the maturity or duration of a debt security, the greater its sensitivity to changes in interest rates.
Large-capitalization risk
Stocks of large-capitalization companies have at times
experienced periods of volatility and negative performance. During such periods, the value of the stocks may decline and the Fund’s performance may be negatively affected.
Liquidity risk
Liquidity risk is the risk associated with a lack of
marketability of investments which may make it difficult to sell the investment at a desirable time or price. Changing regulatory, market or other conditions or environments (for example, the interest rate or credit environments) may adversely
affect the liquidity of the Fund’s investments. The Fund may have to accept a lower selling price for the holding, sell other investments, or forego another, more appealing investment opportunity. Generally, the less liquid the market at the
time the Fund sells a portfolio investment, the greater the risk of loss or decline of value to the Fund. A less liquid market can lead to an increase in Fund redemptions, which may negatively impact Fund performance and net asset value per share,
including, for example, if the Fund is forced to sell securities in a down market.
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 Fund’s 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.
Note 10. 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.
|
28
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Tri-Continental Corporation
| Semiannual Report 2019
|
Notes to Financial Statements (continued)
June 30, 2019 (Unaudited)
Note 11. Information regarding pending and settled
legal proceedings
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 Fund is 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 Fund or the ability of Ameriprise Financial or its affiliates to perform under their contracts with the Fund. Ameriprise Financial is required to make quarterly (10-Q), annual (10-K) and, as necessary,
8-K filings with the Securities and Exchange Commission (SEC) 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 Fund. Further, although we believe proceedings are not likely to have a material adverse effect on the
Fund or the ability of Ameriprise Financial or its affiliates to perform under their contracts with the Fund, 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.
Tri-Continental
Corporation | Semiannual Report 2019
|
29
|
Approval of Management Agreement
Columbia Management Investment Advisers, LLC (Columbia
Threadneedle or the Investment Manager, and together with its domestic and global affiliates, Columbia Threadneedle Investments), a wholly-owned subsidiary of Ameriprise Financial, Inc. (Ameriprise Financial), serves as the investment manager to
Tri-Continental Corporation (the Fund). Under a management agreement (the Management Agreement), Columbia Threadneedle provides investment advice and other services to the Fund and other funds distributed by Columbia Management Investment
Distributors, Inc. (collectively, the Funds).
On an
annual basis, the Fund’s Board of Trustees (the Board), including the independent Board members (the Independent Trustees), considers renewal of the Management Agreement. Columbia Threadneedle prepared detailed reports for the Board and its
Contracts Committee in November 2018 and January, March, April and June 2019, including reports providing the results of analyses performed by an independent organization, Broadridge Financial Solutions, Inc. (Broadridge), and a comprehensive
response to items of information requested by independent legal counsel to the Independent Trustees (Independent Legal Counsel) in a letter to the Investment Manager, to assist the Board in making this determination. Many of the materials presented
at these meetings were first supplied in draft form to designated independent Board representatives, i.e., Independent Legal Counsel, Fund Counsel, the Chair of the Board (who is an Independent Trustee) and the Chair of the Contracts Committee (who
is an Independent Trustee), and the final materials were revised to include information reflective of discussion and subsequent requests made by the Contracts Committee. In addition, throughout the year, the Board (or its committees) regularly meets
with portfolio management teams and senior management personnel and reviews information prepared by Columbia Threadneedle addressing the services Columbia Threadneedle provides and Fund performance. The Board also accords appropriate weight to the
work, deliberations and conclusions of the various committees, such as the Contracts Committee, the Investment Review Committee, the Audit Committee and the Compliance Committee in determining whether to continue the Management Agreement.
The Board, at its June 17-19, 2019 in-person Board meeting
(the June Meeting), considered the renewal of the Management Agreement for an additional one-year term. At the June Meeting, Independent Legal Counsel reviewed with the Independent Trustees various factors relevant to the Board’s consideration
of management agreements and the Board’s legal responsibilities related to such consideration. Following an analysis and discussion of the factors identified below, the Board, including all of the Independent Trustees, approved the renewal of
the Management Agreement.
Nature, extent and quality
of services provided by Columbia Threadneedle
The
Board analyzed various reports and presentations it had received detailing the services performed by Columbia Threadneedle, as well as its history, reputation, expertise, resources and capabilities, and the qualifications of its personnel.
The Board specifically considered the many developments during
recent years concerning the services provided by Columbia Threadneedle, including, in particular, the organization and depth of the equity and credit research departments. The Board further observed the enhancements to the investment risk management
department’s processes, systems and oversight, over the past several years, as well as planned 2019 initiatives. The Board also took into account the broad scope of services provided by Columbia Threadneedle to each Fund, including, among
other services, investment, risk and compliance oversight. The Board also took into account the information it received concerning Columbia Threadneedle’s ability to attract and retain key portfolio management personnel and that it has
sufficient resources to provide competitive and adequate compensation to investment personnel.
In connection with the Board’s evaluation of the overall
package of services provided by Columbia Threadneedle, the Board also considered the nature, quality and range of administrative services provided to the Fund by Columbia Threadneedle, as well as the achievements in 2018 in the performance of
administrative services, and noted the various enhancements anticipated for 2019. In evaluating the quality of services provided under the Management Agreement, the Board also took into account the organization and strength of the Fund’s and
its service providers’ compliance programs. In addition, the Board reviewed the financial condition of Columbia Threadneedle and its affiliates and each entity’s ability to carry out its responsibilities under the Management Agreement
and the Fund’s other service agreements with affiliates of Ameriprise Financial, observing the financial strength of Ameriprise Financial, with its relatively strong cash position and solid balance sheet.
|
30
|
Tri-Continental Corporation
| Semiannual Report 2019
|
Approval of Management Agreement (continued)
The Board also discussed the acceptability of the terms of the
Management Agreement (including the relatively broad scope of services required to be performed by Columbia Threadneedle), noting that no material changes are proposed from the form of agreement previously approved. They also noted the wide array of
legal and compliance services provided to the Funds under the Management Agreement. It was also observed that the services being performed under the Management 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 Threadneedle and its affiliates are 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 Management 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 (including since manager inception): the performance of the Fund, the performance of a benchmark index, the percentage ranking of the Fund among its comparison group, the product score of the
Fund (taking into account performance relative to peers and benchmarks) and the net assets of the Fund. The Board observed that the Fund’s investment performance met expectations.
Comparative fees, costs of services provided and the profits
realized by Columbia Threadneedle and its affiliates from their relationships with the Fund
The Board reviewed comparative fees and the costs of
services provided under the Management 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 Fund’s expenses with median expenses paid by funds in its comparative peer universe, as well as data showing the Fund’s contribution to Columbia Threadneedle’s profitability.
The Board considered the reports of its independent fee
consultant, JDL Consultants, LLC (JDL), which assisted in the Board’s analysis of the Funds’ performance and expenses, the reasonableness of Columbia Threadneedle’s profitability, particularly in comparison to industry competitors,
the reasonableness of the Funds’ fee rates, and JDL’s conclusion that the management fees being charged to the Fund are reasonable. The Board accorded particular weight to the notion that the primary objective of the level of fees is to
achieve 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 certain defined exceptions) are generally in line with the "pricing philosophy"
currently in effect (i.e., that Fund total expense ratios, in general, approximate or are lower than the median expense ratios of funds in the same Lipper comparison universe). The Board took into account that the Fund’s total expense ratio
was well below the peer universe’s median expense ratio shown in the reports. Based on its review, the Board concluded that the Fund’s 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 Threadneedle and its affiliates in connection with Columbia Threadneedle providing management services to the Fund. In this regard, the Independent Trustees referred to their detailed analysis of the Profitability Report, discussing the
profitability to Columbia Threadneedle and Ameriprise Financial from managing, operating and distributing the Funds. The Board considered that in 2018 the Board had concluded that 2017 profitability was reasonable and that the 2019 information shows
that the profitability generated by Columbia Threadneedle in 2018 only slightly increased from 2017 levels. The Board also noted JDL’s report and its conclusion that 2018 Columbia Threadneedle profitability relative to industry competitors was
reasonable. It also took into account the indirect economic benefits flowing to Columbia Threadneedle 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.
Tri-Continental
Corporation | Semiannual Report 2019
|
31
|
Approval of Management Agreement (continued)
Economies of scale to be realized
The Board also considered the economies of scale that might
be realized by the Fund as its net asset level grows and took note of the extent to which Fund shareholders might also benefit from such growth. In this regard, the Board took into account that management fees decline as Fund assets exceed various
breakpoints, all of which have not been surpassed. The Board concluded, though, that there is limited potential for economies of scale that would inure to the benefit of the shareholders given the closed-end nature of the Fund.
Based on the foregoing, the Board, including all of the
Independent Trustees, concluded that the management 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 June 19, 2019, the Board, including all of
the Independent Trustees, approved the renewal of the Management Agreement.
|
32
|
Tri-Continental Corporation
| Semiannual Report 2019
|
Results of Meeting of Stockholders
The
89th Annual Meeting of Stockholders of Tri-Continental Corporation (the Fund) was held on April 16, 2019. Stockholders voted in favor of two Board proposals. The description of each proposal and number of shares voted are as follows:
Proposal 1
To elect one new director and re-elect two directors to the
Fund’s Board of Directors to hold office until the 2022 Annual Meeting of Stockholders and until their successors are elected and qualify:
|
Director
|
For
|
Withheld
|
|
Anthony
M. Santomero
|
38,198,604
|
3,892,035
|
|
Minor
M. Shaw
|
38,275,169
|
3,815,470
|
|
William
F. Truscott
|
38,228,355
|
3,862,284
|
Proposal 2
To ratify the selection of PricewaterhouseCoopers LLP as the
Fund’s independent registered public accounting firm for 2019:
|
For
|
Against
|
Abstain
|
|
38,279,801
|
2,169,644
|
1,641,203
|
Tri-Continental
Corporation | Semiannual Report 2019
|
33
|
The
Fund mails one stockholder report to each stockholder address. If you would like more than one report, please call shareholder services at 800.345.6611, option 3 and additional reports will be sent to you.
Proxy voting policies and procedures
The policy of the Board of Directors is to vote the proxies
of the companies in which the Fund holds investments consistent with the procedures as stated in the SAI. You may obtain a copy of the SAI without charge by calling 800.345.6611, option 3; contacting your financial intermediary; visiting
columbiathreadneedleus.com/investor/; or searching the website of the SEC at sec.gov. Information regarding how the Fund voted proxies relating to portfolio securities is filed with the SEC by August 31st for the most recent 12-month period ending
June 30th of that year, and is available without charge by visiting columbiathreadneedleus.com/investor/, or searching the website of the SEC at sec.gov.
Quarterly schedule of investments
The Fund files a complete schedule of portfolio holdings
with the SEC for the first and third quarters of each fiscal year on Form N-PORT, and for reporting periods ended prior to March 31, 2019, on Form N-Q. The Fund’s Form N-Q and Form N-PORT filings are available on the SEC’s website at
sec.gov. The Fund’s complete schedule of portfolio holdings, as filed on Form N-Q or Form N-PORT, can also be obtained without charge, upon request, by calling 800.345.6611, option 3.
Additional Fund information
For more information about the Fund, please visit
columbiathreadneedleus.com/investor/ or call 800.345.6611, option 3. Customer Service Representatives are available to answer your questions Monday through Friday from 8 a.m. to 7 p.m. Eastern time.
Fund investment manager
Columbia Management Investment Advisers, LLC
225 Franklin Street
Boston, MA 02110
Fund servicing agent
Columbia Management Investment Services Corp.
P.O. Box 219371
Kansas City, MO 64121-9371
|
34
|
Tri-Continental Corporation
| Semiannual Report 2019
|
[THIS PAGE INTENTIONALLY LEFT BLANK]
[THIS PAGE INTENTIONALLY LEFT BLANK]
[THIS PAGE INTENTIONALLY LEFT BLANK]
Tri-Continental Corporation
P.O. Box 219371
Kansas City, MO 64121-9371
You should consider the investment objectives, risks, charges
and expenses of the Fund carefully before investing. A prospectus containing information about the Fund (including its investment objectives, risks, charges, expenses and other information about the Fund) may be obtained by contacting your financial
advisor or Columbia Management Investment Services Corp. at 800.345.6611, option 3. The prospectus should be read carefully before investing in the Fund. Tri-Continental Corporation is managed by Columbia Management Investment Advisers, LLC. This
material is distributed by Columbia Management Investment Distributors, Inc., member FINRA.
Columbia Threadneedle Investments (Columbia Threadneedle) is
the global brand name of the Columbia and Threadneedle group of companies. All rights reserved. Columbia Management Investment Distributors, Inc., 225 Franklin Street, Boston, MA 02110-2804
© 2019 Columbia Management Investment Advisers, LLC.
columbiathreadneedleus.com/investor/
Not applicable for semiannual reports.
|
Item 3.
|
Audit Committee Financial Expert.
|
Not applicable for semiannual reports.
|
Item 4.
|
Principal Accountant Fees and Services.
|
Not applicable for semiannual reports.
|
Item 5.
|
Audit Committee of Listed Registrants.
|
Not applicable for semiannual reports.
|
|
(a)
|
The registrant’s “Schedule I – 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.
|
|
Item 7.
|
Disclosure of Proxy Voting Policies and Procedures for Closed-End
Management Investment Companies.
|
Not applicable for semiannual reports.
|
Item 8.
|
Portfolio Managers of Closed-End Management Investment Companies.
|
Not applicable for semiannual reports.
|
Item 9.
|
Purchases of Equity Securities by Closed-End Management Investment
Company and Affiliated Purchasers.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Period
|
|
Total Number
of Shares
Purchased
|
|
|
Average
Price Paid
Per Share
|
|
|
Total Number of Shares
Purchased as Part of
Publicly Announced
Plans or Programs(1)
|
|
|
Maximum Number of
Shares that May Yet Be
Purchased Under the
Plans or Programs(1)
|
|
|
01-01-19 to 01-31-19
|
|
|
247,537
|
|
|
|
24.56
|
|
|
|
247,537
|
|
|
|
2,445,657
|
|
|
02-01-19 to 02-29-19
|
|
|
198,663
|
|
|
|
26.04
|
|
|
|
198,663
|
|
|
|
2,246,994
|
|
|
03-01-19 to 03-31-19
|
|
|
206,633
|
|
|
|
26.24
|
|
|
|
206,633
|
|
|
|
2,040,361
|
|
|
04-01-19 to 04-30-19
|
|
|
203,256
|
|
|
|
26.88
|
|
|
|
203,256
|
|
|
|
1,837,105
|
|
|
05-01-19 to 05-31-19
|
|
|
223,385
|
|
|
|
26.76
|
|
|
|
223,385
|
|
|
|
1,613,720
|
|
|
06-01-19 to 06-30-19
|
|
|
94,124
|
|
|
|
26.49
|
|
|
|
94,124
|
|
|
|
1,519,596
|
|
|
(1)
|
The registrant has a stock repurchase program. For 2019, the registrant is authorized to repurchase up to 5% of
its outstanding Common Stock directly from stockholders and in the open market, provided that, with respect to shares repurchased in the open market the excess of the net asset value of a share of Common Stock over its market price (the discount) is
greater than 10%. The table reflects trade date + 1, rather than trade date, which is used for financial statement purposes; therefore, shares reflected may vary from capital stock acitivty presented in the shareholder report
|
|
Item 10.
|
Submission of Matters to a Vote of Security Holders.
|
There were no material changes to the procedures by which shareholders may recommend nominees to the registrant’s board of directors.
|
Item 11.
|
Controls and Procedures.
|
|
|
(a)
|
The registrant’s principal executive officer and principal financial officers, based on their evaluation
of the registrant’s 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 material information required to be
disclosed by the registrant in Form N-CSR is accumulated and communicated to the registrant’s 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 registrant’s internal control over financial reporting that occurred during the
period covered by this report that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting.
|
|
Item 12.
|
Disclosure of Securities Lending Activities for Closed-End
Management Investment Companies
|
Not applicable.
(a)(1) Code of ethics required to be disclosed under Item 2 of Form N-CSR: Not applicable for semiannual 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)
|
|
Tri-Continental
Corporation
|
|
|
|
|
|
|
|
|
By (Signature and Title)
|
|
/s/ Christopher O.
Petersen
|
|
|
|
Christopher O. Petersen, President and Principal Executive Officer
|
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.
|
|
|
|
|
By (Signature and Title)
|
|
/s/ Christopher O.
Petersen
|
|
|
|
Christopher O. Petersen, President and Principal Executive Officer
|
|
|
|
|
|
|
|
|
By (Signature and Title)
|
|
/s/ Michael G. Clarke
|
|
|
|
Michael G. Clarke, Chief Financial
Officer
|
Tri-Continental Corp. Prfd (NYSE:TYP)
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Tri-Continental Corp. Prfd (NYSE:TYP)
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