UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
(RULE 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION
14(a) OF THE
SECURITIES EXCHANGE ACT OF 1934
Filed by the Registrant [X]
Filed by a party other than the
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Check the appropriate box:
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Preliminary Proxy Statement |
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Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2)) |
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[X] |
Definitive Proxy Statement |
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[ ] |
Definitive Additional Materials |
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[ ] |
Soliciting Material Pursuant to §240.14a-12 |
RENN Fund, Inc.
(Name of Registrant as Specified In Its
Charter)
(Name of Person(s) Filing Proxy Statement,
if Other Than the Registrant)
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Title of each class of securities to which transaction applies: |
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RENN
Fund, inc.
c/o Horizon Kinetics Asset Management
LLC
470 Park Avenue South
New York, NY 10016
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD ON THURSDAY, September
14, 2023
SOLICITATION OF PROXIES
To the Shareholders of RENN FUND, INC.
NOTICE IS HEREBY GIVEN
that the Annual Meeting of Shareholders (the “Annual Meeting”) of RENN Fund, Inc., a Texas corporation (the “Fund”),
will be held at the offices of Horizon Kinetics Asset Management LLC, 470 Park Avenue South, 3rd Floor South, New York,
NY 10016 on Thursday, September 14, 2023 at 1pm EST. The Annual Meeting will also be held in a virtual format conducted via live
audio webcast for the following purposes:
| 1. | to elect Eric Sites as a Class One Director of the Fund, who is to hold office for a term of
three (3) years or until his successor is elected and qualified; |
| 2. | to elect Alice Brennan as a Class One Director of the Fund, who is to hold office for a term
of three (3) years or until her successor is elected and qualified; |
| 3. | to vote on a proposal to declassify the Board of Directors; |
| 4. | to ratify the appointment by the Fund’s Board of Directors of Tait, Weller & Baker
LLP, as the auditor of the Fund for the fiscal year ending December 31, 2023; |
| 5. | to transact any and all other business that may properly be presented at the Annual Meeting
or any adjournment(s). |
The close of business
on July 14, 2023, has been fixed as the record date for determining shareholders entitled to notice of and to vote at the Annual
Meeting or any adjournment. The enclosed proxy is being solicited on behalf of the Board.
IMPORTANT NOTICE
The Annual Meeting
is currently scheduled to take place in person, however, out of an abundance of caution and to proactively deal with potential
issues arising from the public health impact of Coronavirus-19 (“COVID”), the Annual Meeting will also be held in a
virtual format conducted via live audio webcast online. The Fund strongly encourages all shareholders who wish to attend and participate
in the Annual Meeting to carefully follow the procedures described herein to ensure they can attend and participate in the Annual
Meeting in person or virtually via live audio webcast online.
In
order to participate in the Annual Meeting, shareholders must register by following this link https://attendee.gotowebinar.com/register/3820016087716899161.
Once registered, an email will be sent containing instructions on how to join the webinar either through the Internet or an audio
connection. We encourage all shareholders to register in advance for the Annual Meeting. Shareholders will be able to listen,
vote, and submit questions from their home or from any location. Questions may also be submitted in advance and emailed to rennfund@horizonkinetics.com.
We suggest all shareholders
submit their votes well in advance of the Annual Meeting. You may vote your shares: (1) by telephone; (2) via the Internet; or
(3) by completing, signing, dating, and returning the accompanying proxy card in the enclosed, self-addressed, postage-paid envelope.
Specific instructions for voting by telephone or via the Internet are on the accompanying proxy card. Prompt response by our shareholders
will reduce the time and expense of solicitation. To ensure proper representation at the Annual Meeting, please complete, sign,
date, and return the proxy card in the enclosed, self-addressed envelope.
You may revoke your
proxy at any time prior to the Annual Meeting. If you decide to attend the Annual Meeting virtually and wish to change your vote,
you may do so by faxing your completed proxy card to (718) 765-8730 at the Annual Meeting. Even if you vote your shares prior to
the Annual Meeting, you still may attend the Annual Meeting either in person or virtually.
By Order of the Board of Directors
/s/ JAY KESSLEN
Jay Kesslen
Chief Compliance Officer
New York, New York
July 25, 2023
RENN FUND, INC.
PROXY STATEMENT
FOR
ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD ON THURSDAY, SEPTEMBER 14,
2023
SOLICITATION OF PROXIES
This Proxy Statement
is being furnished to the shareholders of RENN Fund, Inc., a Texas corporation (the “Fund”). The Fund’s Board
of Directors is soliciting proxies to be voted at the Annual Meeting of Shareholders (the “Annual Meeting”) to be held
at the offices of Horizon Kinetics Asset Management LLC, 470 Park Avenue South, 3rd Floor South, New York, NY 10016
on Thursday, September, 14, 2023, 1:00 pm Eastern Standard time, and at any adjournment(s). The Annual Meeting will also be held
in a virtual format conducted via live audio webcast. This Proxy Statement is being sent to Shareholders on or about July 25, 2023.
The accompanying proxy
card is designed to permit each shareholder to vote for or against, or to abstain from voting on, the proposals described in this
Proxy Statement (collectively, the “Proposals”). When a shareholder’s executed proxy card specifies a choice
with respect to a voting matter, the shares will be voted accordingly. If no specifications are made, then the proxy will be
voted by the persons serving as proxies at the Meeting FOR the Proposals:
| 1. | to elect Eric Sites as a Class One Director of the Fund, who is to hold office for a term of
three (3) years or until his successor is elected and qualified; |
| 2. | to elect Alice Brennan as a Class One Director of the Fund, who is to hold office for a term
of three (3) years or until her successor is elected and qualified; |
| 3. | to vote on a proposal to declassify the Board of Directors; |
| 4. | to ratify the appointment by the Fund’s Board of Directors of Tait, Weller & Baker
LLP, as the auditor of the Fund for the fiscal year ending December 31, 2023; |
| 5. | to transact any and all other business that may properly be presented at the Annual Meeting
or any adjournment(s). |
The Board of Directors encourages shareholders
to participate in the Annual Meeting either in person or virtually by registering in advance through the following link:
https://attendee.gotowebinar.com/register/3820016087716899161
Once registered, an
email will be sent containing instructions on how to join the webinar either through the Internet or an audio connection. Shareholders
will be able to listen, vote, and submit questions from any location. Questions may also be submitted in advance and emailed to
rennfund@horizonkinetics.com. Executing and returning the accompanying proxy card will not affect a shareholder’s
right to attend the Annual Meeting. Any shareholder who was given a proxy has the right to revoke it at any time before it is
voted by giving written notice of revocation prior to the date of the meeting to Corporate Secretary, RENN Fund, Inc., c/o Horizon
Kinetics Asset Management, LLC, 470 Park Avenue South, 3rd Floor South, New York, NY 10016, by executing and delivering
a later-dated proxy. No revocation notice or later-dated proxy, however, will be effective until received by the Fund at, or prior
to, the Annual Meeting. Revocation will not affect a vote on any matters taken prior to the receipt of the revocation. Mere in
person or virtual attendance at the Annual Meeting will not by itself revoke the proxy.
In addition to soliciting
proxies by mail, officers and Directors of the Fund and officers, directors, and employees of the Adviser may solicit the return
of proxies by personal interview, mail, telephone, and facsimile. These persons will not receive additional compensation for their
services but will be reimbursed for out-of-pocket expenses by Horizon Kinetics Asset Management LLC. After the date of this Proxy
Statement, but prior to the date of the Annual Meeting, the Fund may engage a proxy solicitation firm at a cost to be negotiated
but paid for by Horizon Kinetics Asset Management LLC. Brokerage houses and other custodians, nominees, and fiduciaries will be
requested by the Fund to forward solicitation material to the beneficial owners of shares. Horizon Kinetics Asset Management LLC
will pay all costs of solicitation.
You may obtain copies
of the Fund’s proxy materials and of its Annual Shareholders Report for the year ended December 31, 2022, from the Fund’s
website at https://horizonkinetics.com/products/closed-end-funds/renn/ or you may call EQ, our transfer agent, at (800)
937-5449, and request that a copy be mailed to you free of charge.
The Fund’s principal
offices are located at 470 Park Avenue South, 3rd Floor South, New York, New York 10016, which is the current address
of Horizon Kinetics Asset Management LLC. Shareholders will be allowed entry into this location or may participate virtually at
the Annual Meeting by following the instructions contained herein.
PURPOSES OF THE MEETING
At the Annual Meeting,
Shareholders will consider and vote upon the following matters:
| 1. | to elect Eric Sites as a Class One Director of the Fund, who is to hold office for a term of
three (3) years or until his successor is elected and qualified; |
| 2. | to elect Alice Brennan as a Class One Director of the Fund, who is to hold office for a term
of three (3) years or until her successor is elected and qualified; |
| 3. | to vote on a proposal to declassify the Board of Directors; |
| 4. | to ratify the appointment by the Fund’s Board of Directors of Tait, Weller & Baker
LLP, as the auditor of the Fund for the fiscal year ending December 31, 2023; |
| 5. | to transact any and all other business that may properly be presented at the Annual Meeting
or any adjournment(s). |
RECORD DATE AND SHARE OWNERSHIP
The close of business
on July 14, 2023, has been fixed as the record date (the “Record Date”) for determining shareholders entitled to notice
of and to vote at the Annual Meeting and any adjournment. At the close of business on July 14, 2023, the Fund had outstanding 7,015,786
shares of common stock held by approximately 302 registered owners and 1,387 beneficial owners.
QUORUM
REQUIRED
A quorum must be present
at the Annual Meeting for any business to be conducted. The presence at the Annual Meeting, in person, virtually, or by proxy,
of the holders of a majority of all the shares entitled to vote at the Annual Meeting will constitute a quorum. Abstentions will
be treated as shares present for quorum purposes. Shares held in street name for which the broker has not received voting instructions
from the record holder and does not have discretionary authority to vote the shares on certain Proposals (which are considered
“Broker Non-Votes” with respect to such Proposals) will be treated as shares present for quorum purposes.
If a quorum is not present
at the Annual Meeting, the shareholders who are represented may adjourn the Annual Meeting until a quorum is present. The persons
named as proxies will vote those proxies for such adjournment, unless marked to be voted against any Proposal for which an adjournment
is sought, to permit the further solicitation of proxies.
VOTE
REQUIRED
Each share of common
stock of the Fund is entitled to one vote on each matter to be voted upon at the Annual Meeting. The common stock is the only class
of securities of the Fund entitled to vote at the Annual Meeting. A shareholder is entitled to vote all shares of common stock
held of record at the close of business on the Record Date, in person, virtually, or by proxy, at the Annual Meeting. There are
no cumulative voting rights. All votes will be tabulated by the Inspector of Elections appointed for the meeting, who will separately
tabulate affirmative and negative votes, abstentions, and broker non-votes.
Approval of
the election of the Director (Proposal One). The affirmative vote of a majority of the votes cast at the Annual
Meeting is sufficient to independently elect Eric Sites as Director. Broker non-votes, if any, and abstentions will not be considered
votes cast, and therefore will have no effect on the outcome of the election of the nominees.
Approval of
the election of the Director (Proposal Two). The affirmative vote of a majority of the votes cast at the Annual
Meeting is sufficient to independently elect Alice Brennan as Director. Broker non-votes, if any, and abstentions will not be considered
votes cast, and therefore will have no effect on the outcome of the election of the nominees.
Approval of
proposal to declassify the Board of Directors (Proposal Three). The affirmative vote of a majority of the shares present,
in person, virtually, or by proxy, and entitled to vote at the Annual Meeting is required for the declassification of the Board
of Directors. On December 8, 2022, the Board of Directors voted unanimously to proceed with an amendment to the Company’s
Bylaws providing for the declassification of the Board of Directors, subject to shareholder approval, so that the election of the
entire Board is voted upon each year. Broker non-votes, if any, and abstentions will not be considered votes cast, and therefore
will have no effect on the outcome of the election to declassify the board of directors.
Ratification
of the Board’s appointment of auditor of the Fund for the 2023 fiscal year (Proposal Four). The affirmative vote
of a majority of the shares present, in person, virtually, or by proxy, and entitled to vote at the Annual Meeting is required
for the ratification of the selection of the Fund’s independent auditor. An abstention will have the effect of a vote against
the ratification of the appointment of Tait, Weller & Baker LLP, as the Fund’s independent auditor. Shares represented
by broker non-votes, if any, will not be considered entitled to vote on this Proposal, and therefore will not have any effect on
the outcome of the vote to ratify the appointment of the auditor.
Broker-dealers are
prohibited from voting on certain matters for which they have not received voting instructions from the beneficial owners of shares
held in street name. Proxies submitted by brokers for non-routine proposals are considered “broker non-votes” with
respect to such matters, and the shares represented by those proxies will not be considered entitled to vote on such matters but
will be deemed present at the Annual Meeting for purposes of establishing a quorum. Under applicable stock exchange rules, broker-dealers
are permitted to vote, in their discretion, on certain routine matters, such as the ratification of the appointment of auditors.
Therefore, the Fund does not expect that there will be any broker non-votes on Proposal One, Proposal Two, Proposal Three, or Proposal
Four.
Additional solicitation.
If there are not enough votes to approve any Proposals at the Annual Meeting, the shareholders who are present or represented
may adjourn the Annual Meeting to permit the further solicitation of proxies. The persons named as proxies will vote those proxies
for such adjournment, unless marked to be voted against any Proposal for which an adjournment is sought to permit, the further
solicitation of proxies. Also, a shareholder vote may be taken on any of the Proposals in this Proxy Statement prior to any such
adjournment if there are sufficient votes for approval of such Proposal.
VOTING ELECTRONICALLY VIA THE INTERNET
OR BY TELEPHONE
In lieu of mailing
in the proxy card, shareholders whose shares are registered in their own names may vote either via the Internet or by telephone.
Specific instructions to be followed by any registered shareholder interested in voting via the Internet or by telephone are set
forth on the enclosed proxy card. The Internet and telephone voting procedures are designed to authenticate the shareholder’s
identity and to allow shareholders to vote their shares and confirm that their voting instructions have been properly recorded.
If your shares are
registered in the name of a bank or brokerage firm, you may be eligible to vote your shares electronically over the Internet or
by telephone. A large number of banks and brokerage firms are participating in the Broadridge Investor Communications Services
online program, which provides eligible street-name shareholders the opportunity to vote via the Internet or by telephone. If your
bank or brokerage firm is participating in that program, they will furnish you with a proxy card with instructions. If your proxy
card does not reference Internet or telephone information, please complete and return the proxy card in the self-addressed, postage-paid
envelope provided. To vote in person at the Annual Meeting, you must first obtain a valid legal proxy from your broker, bank or
other agent and then register in advance to attend the Annual Meeting. Follow the instructions from your broker or bank included
with these proxy materials or contact your broker or bank to request a legal proxy form.
After obtaining a valid
legal proxy from your broker, bank or other agent, to then register to attend the Annual Meeting, you must submit proof of your
legal proxy reflecting the number of your shares along with your name and email address to EQ. Requests for registration should
be directed to proxy@equiniti.com or to facsimile number 718-765-8730. Written requests can be mailed to:
EQ
Attn: EQ Mail Services
6201 15th Avenue, Brooklyn, NY
11219
Requests for registration
must be labeled as “Legal Proxy” and be received no later than 5:00 p.m., Eastern Time, on September 4, 2023. You will
receive a confirmation of your registration by email after we receive your registration materials.
You
may attend the Annual Meeting in person or attend virtually. You must register first at https://attendee.gotowebinar.com/register/3820016087716899161.
Once registered, an email will be sent containing instructions on how to join the webinar either
through the Internet or an audio connection. Shareholders will be able to listen, vote, and submit questions from their home or
from any location. Questions may be submitted in advance and emailed to rennfund@horizonkinetics.com. We encourage you
to register for the meeting prior to the start time leaving ample time for the check in.
SECURITY
OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table
sets forth certain information known to the Fund with respect to beneficial ownership of the Fund’s common stock as of June
30, 2023, for: (i) all persons who are beneficial owners of more than 5% of the outstanding shares of the Fund’s common stock;
(ii) each Director and nominee for Director of the Fund; and (iii) all executive officers and Directors of the Fund as a group.
The Fund has no officers other than the individuals named in the table below.
Name
of Beneficial Owners(1) |
Number
of Shares Beneficially Owned Directly or Indirectly |
Percent of Class |
Russell Cleveland, Director2 |
359,618(3) |
5.13% |
Murray Stahl, Director, President,
Chief Executive Officer, Chairman of the Board and CFO |
508,773(4) |
7.25% |
Eric Sites, Director |
2,667 |
0.04% |
Alice C. Brennan, Director |
1,334 |
0.02% |
Douglas J Cohen |
500 |
0.01% |
Peter B Doyle |
13,334(5) |
0.19% |
Steven M Bregman |
4,934 |
0.07% |
Jay Kesslen |
38,011 |
0.54% |
Alun Williams |
1,100 |
0.02% |
Russ Grimaldi |
400 |
0.01% |
All
Directors and Executive Officers as a group (10 persons)1 |
930,671 |
13.27% |
(1) |
The address of all persons named
in the table other than Mr. Cleveland is c/o Horizon Kinetics Asset Management LLC, 470 Park Avenue South, New York, New York
10016. Mr. Cleveland’s address is c/o RENN Capital Group, Inc., 16660 Dallas Parkway, Suite 2600, Dallas, Texas 75248. |
|
|
(2) |
Mr. Cleveland is an “interested
person” of the Fund as defined by Section 2(a)(19) of the 1940 Act by virtue of being a limited partner in the Cleveland
Family Limited Partnership, which owns more than 5% of the Fund’s securities. |
|
|
(3) |
All shares are owned by the Cleveland Family Limited Partnership, of which Mr. Cleveland is the managing partner and also a limited partner. |
|
|
(4) |
These shares are held by an account
for which Mr. Stahl serves as managing member and in which he, along with other shareholders of Horizon Kinetics Asset Management
LLC, owns an interest. Mr. Stahl disclaims beneficial ownership over approximately 80% of the shares reported as he does not have
a pecuniary interest in such shares. |
|
|
(5) |
These shares are held by Mr. Doyle’s
spouse. |
None of the above individuals
beneficially owns equity securities in registered investment companies within the same Family of Investment Companies as the Fund.
A “Family of Investment Companies” is two or more registered investment companies that share the same investment adviser
and hold themselves out to investors as related companies for purposes of investment and investment services. The Fund is not currently
grouped with any such companies. None of the above individuals directly or indirectly owns beneficially or of record any class
of securities of any entity controlling, controlled by, or under common control with the Adviser, other than as disclosed above
regarding the Fund.
PROPOSAL
ONE and proposal two
ELECTION
OF CLASS ONE DIRECTORS
Pursuant to the Fund’s
Restated Articles of Incorporation and Bylaws, the Board of Directors is to consist of one or more Directors, the number of
which may be increased or decreased from time to time by resolution adopted by a majority of the Board.
The Board is divided
into three classes, and each class normally serves for a three-year term. Under Texas law, procedures are available to remove Directors
even if they are not then standing for re-election. Otherwise, ordinarily only those Directors in a single class may be changed
in any one year. Having a classified Board of Directors may be regarded as an “anti-takeover” provision by making it
more difficult for shareholders to change the majority of Directors and may have the effect of maintaining the continuity of management.
The nominees for Class
One Directors who receives the majority of the votes cast for the directorship will be elected.
INFORMATION CONCERNING NOMINEES AND CONTINUING
DIRECTOR
Term of Office.
The term of office of the Class One Directors expires at this Annual Meeting. The term of office of the Class Two Director
expires at the Annual Meeting to be held in 2024. The term of office for the Class Three Directors expires at the Annual Meeting
to be held in 2025. The current Class One Directors, Eric Sites and Alice Brennan, are proposed to be re-elected at this Annual
meeting, to serve for a term on three (3) years or until their successor is elected and qualified.
Name(1) |
Position(s)
Held with the Fund,
Principal Occupation(s) During Past 5 Years,
and Other Directorships
|
Current
Term
and
Time Served
|
Portfolios
in Fund Complex(2)
Overseen by Director or Nominee
|
Interested Directors: |
Russell Cleveland
(3)
Age 84
|
Director of the Fund (principal occupation)
Class Three Director of
the Fund
Other Directorships:
Former Director of AnchorFree,
Inc.
Former Director of
iSatori, Inc., formerly a Portfolio company (nutraceutical preparations)
Former
Director of Cover-All Technologies, Inc., a non-portfolio public company.
Former Director of Access
Plans, Inc. (dir. mail/advert)
Former Director of
BPO Management Services, Inc.
(business process outsourcing)
Former Director of
CaminoSoft (systems software) |
Annual/Since 1994
Until 2025 Annual Meeting/Since 1994
2012-2018
2003-2015
2003 - 2015
2008 - 2009
2006 - 2011
2004 - 2011 |
One
|
Name(1) |
Position(s)
Held with the Fund,
Principal Occupation(s) During Past 5 Years,
and Other Directorships
|
Current
Term
and
Time Served
|
Portfolios
in Fund Complex(2)
Overseen by Director or Nominee
|
Murray Stahl(4)
Age 69
|
Chairman, President, CEO
of the Fund
Class Three Director
of the Fund
Chairman, Chief Executive
Officer and Chief Investment Strategist of Horizon Kinetics LLC (Principal occupation)
Other Directorships:
Chairman, the FRMO Corp.
(OTC Pink: FRMO)
Director, Texas Pacific Land Corporation (royalty
co.)
Director, Bermuda
Stock Exchange (stock exchange) Chairman,
Director, Minneapolis Grain Exchange (commodity
exchange)
Director, MSRH, LLC (investment
advisory)
Director, Winland Electronics,
Inc. (environmental monitoring)
Director, IL&FS
Securities Services Ltd (securities market services) |
Annual/Since 2017
Until 2025 Annual Meeting/Since 2017
Annual/Since 1994
Since 2001
Since 2021
Since 2014
Since 2013
Since 2013
2015 - 2020
2008 - 2020 |
Twelve
|
Eric Sites(4)
Age 44
|
Class One Director of the
Fund
Portfolio Manager,
Horizon Kinetics Asset Management LLC
(Principal occupation)
Other Directorship:
Director, Bermuda Stock
Exchange
Director, IL&FS Securities
Services Ltd (securities market services)
Director, Canadian
Securities Exchange (securities market) |
Until 2023 Annual Meeting/Since 2017
Since 2004
Since 2016
Since 2021
Since 2020
|
One
|
Name(1) |
Position(s)
Held with the Fund, Principal Occupation(s) During Past 5 Years, and Other Directorships
|
Current
Term
and
Time Served
|
Portfolios
in Fund Complex(2)
Overseen by Director or Nominee
|
Independent
Directors: |
Alice C. Brennan
Age 70
|
Class One Director of the Fund
Independent Consultant
(legal and compliance risk oversight) (Principal occupation)
Senior Advisor, Advaita Capital (Investments)
Greenbacker Renewal Energy Company II (Sustainable
Infrastructure Company)
Director, the FRMO Corp. (OTC Pink: FRMO)
Associate General
Counsel, Chief Compliance Officer & Chief Trademark and Copyright Counsel, Verizon
Wireless (prior
principal occupation) |
Until 2023 Annual Meeting/Since 2017
Since 2014
Since 2021
Since 2022
Since 2021
2000-2014 |
One
|
Name(1) |
Position(s) Held with the Fund,
Principal Occupation(s) During Past 5
Years, and Other Directorships
|
Current
Term
and
Time Served
|
Portfolios
in Fund Complex(2)
Overseen by Director or Nominee
|
Douglas J. Cohen
Age 61
|
Class Two Director of the Fund
Chief Financial Officer, Sunrise Credit Services,
Inc.
Accounting Manager, Wagner & Zwerman,
LLP
Senior Accountant, Leon D. Alpern & Company
Director, the FRMO Corp. (OTC Pink: FRMO)
Certified Public
Accountant |
Until 2024 Annual Meeting/Since 2022
2005-2022
1997-2005
1985-1997
Since 2021
Since 1994 |
One
|
Steven M. Bregman
Age 64
|
Co-Portfolio Managers
Co-Portfolio Manager of the Fund
President and Co-Founder, Horizon Kinetics
LLC (Principal occupation)
President and CFO, FRMO Corp.
Director, Winland Electronics
|
Since 2021
Annual/Since 1994
Since 2001
Since 2020
|
Four
|
Peter B Doyle
Age 61 |
Co-Portfolio Manager of the Fund
Managing Director and Co-Founder, Horizon Kinetics LLC, President of Kinetics Mutual Funds, Inc., (Principal Occupation)
Vice President, FRMO Corp.
Senior Investment Officer, Bankers Trust Company |
Since 2021
Annual/Since 1994
Since 2001
1985-1994 |
|
| (1) | The
address of all persons named in the table other than Mr. Cleveland is c/o Horizon Kinetics Asset Management LLC, 470 Park Avenue
South, New York, New York 10016. Mr. Cleveland’s address is c/o RENN Capital Group, Inc., 16660 Dallas Parkway, Suite 2600,
Dallas, Texas 75248. |
| (2) | The
term “Fund Complex” means all 1940-Act-registered investment funds, or separate portfolios of such a fund, which share
a common investment adviser (or have investment advisers that are affiliated persons) or which hold themselves out to investors
as related companies for purposes of investment and investment services. The Fund is not grouped into a Fund Complex with other
1940-Act-registered investment funds. |
| (3) | Mr.
Cleveland is currently considered an “interested person” of the Fund as defined by Section 2(a)(19) of the 1940 Act
by virtue of being a limited partner in the Cleveland Family Limited Partnership, which owns more than 5% of the Fund’s
securities. |
| (4) | Horizon
Kinetics Asset Management LLC is the investment adviser to the Fund and Mr. Stahl and Mr. Sites are “interested persons”
of the Fund as defined in Section 2(a)(19) of the 1940 Act by virtue of being officers and directors of Horizon Kinetics Asset
Management LLC, and in Mr. Stahl’s case, a director and beneficial owner of outstanding securities of Horizon Kinetics Asset
Management LLC. |
The following table
sets forth information about the dollar range of equity securities owned by Mr. Cleveland and each Director in the Fund and, on
an aggregate basis, in any registered investment companies overseen or to be overseen by such person within the same Family of
Investment Companies as the Fund.
Name |
Dollar Range of Shares in Fund |
Aggregate Dollar Range of Equity Securities in Funds Overseen by Director or Nominee in Family of Investment Companies(1) |
Interested Directors: |
|
|
Russell Cleveland |
Over $100,000 |
Over $100,000 |
Murray Stahl |
Over $100,000 |
Over $100,000 |
Eric Sites |
$0-$10,000 |
$0-$10,000 |
Independent Directors: |
|
|
Alice C. Brennan |
$0-$10,000 |
$0-$10,000 |
Douglas J. Cohen |
$0-$10,000 |
$0-$10,000 |
Co-Portfolio Managers: |
|
|
Steven M. Bregman |
$0-$10,000 |
$0-$10,000 |
Peter B. Doyle |
$10,000-$50,000 |
$10,000-$50,000 |
| (1) | The term “Family of Investment Companies”
means all 1940-Act-registered investment funds that share the same investment adviser and hold themselves out to investors as
related companies for purposes of investment and investment services. The Fund is grouped into a Family of Investment Companies
with no other 1940-Act-registered investment funds. |
Board Member
Attributes. The following is a summary of some of the experience, skills, and attributes that led to the conclusion that
each member should serve as a Director for the Fund:
Russell Cleveland
is a Chartered Financial Analyst with more than 40 years of experience as a specialist in investments in smaller capitalization
companies. A graduate of the Wharton School of Business, Russell Cleveland has served as President of the Dallas Association of
Investment Analysts. He also previously served as the President, Chief Executive Officer, sole Director, and beneficial shareholder
of all of the shares of RENN Capital Group, Inc. (“RENN Group”), the prior investment adviser to the Fund. Mr. Cleveland
is deemed to be a valuable Board member due to his depth of knowledge of the Fund, his business judgment, and extensive experience
in the field of investment management.
Murray Stahl,
the current President, Chief Executive Officer, and Director of the Fund, is a co-founder, Chief Executive Officer, and Chairman
of the Board of Horizon Kinetics Asset Management LLC. He has over 30 years of investing experience and is responsible for overseeing
Horizon Kinetics’ proprietary research. Murray is the Portfolio Manager of the Fund as well as Co-Portfolio Managers, Steven
M. Bregman and Peter Doyle. Murray serves as Horizon Kinetics’ Chief Investment Officer, and chairs the firm’s Investment
Committee, which is responsible for portfolio management decisions across the entire firm. He is also the Co-Portfolio Manager
for a number of registered investment companies, private funds, and institutional separate accounts. Additionally, Murray is the
Chairman and Chief Executive Officer of FRMO Corp. He is also a member of the Board of Directors of the Texas Pacific Land Corporation,
Bermuda Stock Exchange, MSRH, LLC, and the Minneapolis Grain Exchange. Prior to co-founding Horizon Kinetics, Murray spent 16 years
at Bankers Trust Company (1978-1994) as a senior portfolio manager and research analyst. As a senior fund manager, he was responsible
for investing the Utility Mutual Fund, along with three of the bank’s Common Trust Funds: The Special Opportunity Fund, The
Utility Fund, and The Tangible Assets Fund. He was also a member of the Equity Strategy Group and the Investment Strategy Group,
which established asset allocation guidelines for the Private Bank. Murray received a Bachelor of Arts in 1976 and a Master of
Arts in 1980 from Brooklyn College, and an MBA from Pace University in 1985.
Alice
C. Brennan has served as a corporate officer and senior legal executive at global healthcare and technology companies for more
than 20 years and has expertise in corporate risk management, regulatory compliance, corporate governance, and technology/innovation.
Ms. Brennan currently serves as a Senior Advisor for Advaita Capital and a business consultant to expert networks, helping their
clients understand legal and ESG, compliance risk oversight, and technology trends. Ms. Brennan serves on the Board of Directors
for Greenbacker Renewable Energy Company II, a sustainable infrastructure company. Ms Brennan also serves on the Board of Directors
for FRMO Corp, a publicly traded company with interests in Horizon Kinetics.
Previously, Ms. Brennan served as Associate General Counsel and Chief Compliance Officer for Verizon Wireless, and prior to that
was Vice President, Secretary and Chief Compliance Officer for Bristol-Myers Squibb Company. Ms. Brennan received a Bachelor of
Arts from Skidmore College, a Master of Arts from Columbia University and a Juris Doctor from Hofstra Law School. Ms. Brennan is
a NACD Certified Director and a NACD New Jersey Chapter board member.
Eric Sites is a Vice President at
Horizon Kinetics Asset Management LLC. Eric joined Horizon Kinetics in 2004 and is a Portfolio Manager and Research Analyst for
the firm. He serves on the investment team for certain registered investment companies managed by the investment adviser subsidiaries
of Horizon Kinetics. Eric is also a member of the Board of Directors of IL&FS Securities Services Limited, the Bermuda Stock
Exchange and the Canadian Securities Exchange. Eric received a BA from Southern Illinois University in 2000 and an MA from Columbia
University, Teachers College in 2002.
Douglas
J. Cohen is an Independent Director of the Fund. Mr. Cohen is a CPA, previously employed at Sunrise Credit Services,
Inc. for 16 year. Prior to this, Mr. Cohen was employed as an Accounting Manager for Wagner & Zwerman, LLP and a Senior Accountant
for Leon D. Alpern & Company. Mr. Cohen is a Director for the Kinetics Mutual Funds, Inc., where he serves as the Chairman
of the Audit Committee and a member of the Pricing Committee. Mr. Cohen received a Bachelor of Business Economics and Accounting
in May of 1984 from the State University of New York at Oneonta.
Steven M. Bregman
is a Co-Portfolio Manager of the Fund. Steven is the President of Horizon
Kinetics LLC and is a co-founder of the Firm. He is a senior member of the Firm’s research team, a member of the Investment
Committee and Board, and supervises all research reports produced by the Firm. As one of the largest independent research firms,
Horizon Kinetics focuses on structurally inefficient market sectors, including domestic spin-offs, global spin-offs (The Spin-Off
Report and (Global Spin-Off Report), distressed debt (Contrarian Fixed Income) and short sale candidates (Devil’s Advocate),
among others. Horizon Kinetics has also taken an interest in creating functionally improved indexes, such as the Spin-Off Indexes
and the Wealth Indexes (which incorporate the owner-operator return variable). Steve is also the President and CFO of FRMO Corp.,
a publicly traded company with interests in Horizon Kinetics and is a member of the Board of Directors of Winland Electronics,
Inc. He received a BA from Hunter College, and his CFA® Charter in 1989. Steve has authored a variety of papers, notably “Spin-offs
Revisited: A Review of a Structural Pricing Anomaly” (1996) and “Equity Strategies and Inflation” (2012).
Peter
B. Doyle is a Co-Portfolio Manager of the Fund. Peter is a Managing Director and co-founder of Horizon Kinetics LLC. He is
a senior member of the research team, and a member of the Investment Committee and the Board. Peter is a Co-Portfolio Manager for
several registered investment companies, private funds, and institutional separate accounts. He is also responsible for oversight
of the Firm’s marketing and sales activities and is the Vice President of FRMO Corp. Previously, Peter was with Bankers Trust
Company (1985-1994) as a Senior Investment Officer, where he also served on the Finance, Utility and REIT Research sub-group teams.
Peter received a BS from St. John’s University and an MBA from Fordham University
Diversity in
Board Members. In selecting nominees for election or re-election to the Board, consideration is given to the presence
on the Board of a broad spectrum of business acumen and personal perspectives. The Fund has members who bring experience in securities
and finance, executive management of corporations, directorships, corporate governance and financial reporting, among others. The
Fund has no policy regarding such, but it intends to keep a diversity of skills and attitudes in its Board makeup, and it assesses
those qualities in any present Director or one who is being considered for nomination to the Board.
Board’s
Role in Risk Management. The Board endeavors to forestall risk by its development of fundamental investment policies for
approval by the shareholders and other policies which are more flexible for the Adviser’s activities on the Fund’s
behalf. The Board is also involved in the assessment and monitoring of risk by virtue of its review of the Fund’s investment
activities, noting whether the portfolio has industry or geographic susceptibilities, by the appointment of the Adviser’s
portfolio managers to directorships on portfolio boards when indicated, and by review of the financial particulars of the Fund,
including any occasions of debt. It also considers the strength of the Adviser’s staff to provide uninterruptible investment
and administrative services to the Fund. The Board feels that its considerable oversight of risk fuses well with the Fund’s
leadership structure.
Board Structure.
Murray Stahl serves as both the Chairman of the Board and the Fund’s Chief Executive Officer, and the Board has
determined that the dual role is appropriate for this Fund. Mr. Stahl is an interested person in the Fund by virtue of his roles
with Horizon Kinetics Asset Management LLC, the Fund’s investment adviser, giving him an additional incentive for its good
performance and protection. He does not receive compensation from the Fund for either role except for his indirect benefit from
Horizon Kinetics Asset Management LLC’s management fee, if any. The appointment of a separate person to serve as chairman
would likely require the Fund to incur additional fee expense for the position, which the Board feels is unwarranted at this time.
While not being named as such, the chairs of the Fund’s Audit and Governance Committees in essence serve as lead independent
Directors. They regularly hold meetings without management present to assess matters concerning financial reporting and administrative
risk and portfolio investment parameters and execution risk, and relay to the Chairman of the Board any concerns they may have.
Director Transactions
with Affiliates. As of the record date, with the exception of interested Director Murray Stahl, none of the Directors
own any interest in Horizon Kinetics Asset Management LLC, the Fund’s investment adviser, or any person controlling, controlled
by, or under common control with Horizon Kinetics Asset Management LLC; nor has any Director, or a member of his immediate family,
engaged in, or had a material interest in, a transaction or series of similar transactions involving the Fund, RENN Group or Horizon
Kinetics Asset Management LLC which exceeded $120,000 in any fiscal year during the previous five fiscal years of the Fund; nor
is any such transaction being currently considered. Since January 1, 2015, no Director or nominee, or a member of his or her immediate
family, has had a material interest in any material transaction or any currently proposed material transaction involving the Fund,
RENN Group or Horizon Kinetics Asset Management LLC, an officer of the Fund, RENN Group or Horizon Kinetics Asset Management LLC,
a parent, subsidiary or other affiliate of RENN Group or Horizon Kinetics Asset Management LLC (or any officer of such a parent,
subsidiary or affiliate) or any investment company having the same adviser as the Fund (or any officer of such an investment company).
Legal Proceedings.
There have been no material pending legal proceedings in which any Director or nominee for Director or any affiliated person of
such Director or nominee is a party adverse to the Fund or has a material interest adverse to the Fund or any of its affiliated
persons. Director nominee Eric Sites filed for personal bankruptcy protection under Chapter 13 of the United States Bankruptcy
Code in 2011. The Chapter 13 plan of reorganization was approved by the United States Bankruptcy Court for the Northern District
of Illinois in October 2011, and Mr. Sites was granted a discharge in July 2016.
Additional information
concerning the Directors may be included in the Statement of Additional Information contained in the N-2 registration statement
filed with the SEC by the Fund. This information may be obtained without charge by calling 1-646-291-2300.
Board Meetings
and Committees. The Board of Directors held four meetings during 2020. The Board has established an Audit Committee, a
Nominating and Corporate Governance Committee, and a Pricing Committee. The Board has not established a Compensation Committee
because the Fund has no employees, its officers receive no compensation from the Fund, and the Fund has never issued options or
warrants to officers or Directors of the Fund. All current Directors attended 100% of the meetings held by the Board and all committees
on which such Director served during 2022.
The Fund does not
have a formal policy regarding director attendance at meetings of shareholders. Mr. Stahl, Mr. Sites, and Ms. Brennan were elected
as directors for the first time at the 2017 Meeting. Mr. Cleveland attended and served as chair of the 2017 Meeting. Mr. Cohen
was elected as a director for the first time at the 2022 Meeting.
Audit Committee.
The Audit Committee is appointed by the Board of Directors to assist the Board in fulfilling its oversight responsibilities. In
2022, the Audit Committee held two meetings. The primary duties and responsibilities of the Audit Committee are:
| ● | to select and approve the
compensation of the Fund’s independent auditors, including those to be retained for the purpose of preparing or issuing
an audit report or performing other audit review or attest services for the Fund; |
| ● | to monitor the independence
and performance of the Fund’s independent auditors, who report directly to the Audit Committee; |
| ● | to oversee generally the
accounting and financial reporting processes of the Fund and the audits of its financial statements; |
| ● | to review the reports and
recommendations of the Fund’s independent auditors; |
| ● | to provide an avenue of
communication among the independent auditors, management, and the Board of Directors; and |
| ● | to address any matters
between the Fund and its independent auditors regarding financial reporting. |
During 2022, the Audit
Committee was comprised of two Directors, who currently are Alice C. Brennan and Douglas J. Cohen, each of whom is an independent
director. Herbert M. Chain was on this committee until his resignation from the Board in December of 2022.
The Audit Committee
has a written charter, a copy of which is attached as Appendix B.
SEC rules recommend
that an audit committee have a member who is a “financial expert.” The SEC rules do not require that an audit committee
financial expert have any additional duties, obligations or liabilities, and he is not considered an expert under the Securities
Act of 1933. The Board of Directors determined that Douglas J. Cohen satisfies the standard for “audit committee financial
expert” within the meaning of the rules.
Nominating and
Corporate Governance Committee. The Nominating and Corporate Governance Committee was created in January 2004 and is responsible
for nominating individuals to serve as Directors and to address such governance matters as the Board may request from time to time.
In
its assessment of each potential nominee for Director, the Committee reviews the nominee’s judgment, experience, independence,
financial literacy, knowledge of emerging growth companies, understanding of the Fund and its investment objectives, and such other
factors as the Committee may determine. The Committee also considers the ability of a nominee to devote the time and effort necessary
to fulfill his or her responsibilities. The Committee has no formal policy regarding the consideration of nominees for election
as directors that may be recommended by shareholders of the Fund but would consider any qualified persons who might be recommended
by shareholders in appropriate circumstances.
During 2022, the Nominating
and Corporate Governance Committee held two meetings and is comprised of two independent Directors, who currently are Alice C.
Brennan and Douglas J. Cohen.
The Nominating
and Corporate Governance Committee has a written charter, a copy of which is attached as Appendix A to the Fund’s proxy statement.
Pricing Committee.
The Pricing Committee held two meetings in 2022 and is comprised of Alice C. Brennan and Douglas J. Cohen.
Director Compensation.
The Fund does not pay any fees to, or reimburse expenses of, its Directors who are considered “interested persons”
of the Fund. Directors who are not interested persons of either the Fund or its investment adviser, Horizon Kinetics Asset Management
LLC, currently receive no fee but are entitled to out-of-pocket expenses for each quarterly meeting attended. For the fiscal year
ended December 31, 2020, the aggregate compensation paid by the Fund to each Director, and the aggregate compensation paid by any
other funds in a Fund Complex with the Fund to each Director, is set forth below:
Name of Director |
Aggregate Deferred Compensation from Fund |
Retirement Benefits Accrued as Part of Fund Expenses |
Estimated Annual Benefits upon Retirement |
Total
2022 Compensation from Fund and Fund Complex(3)(4) |
Russell Cleveland(1) |
$ 0 |
$ 0 |
$ 0 |
$ 0 |
Murray Stahl(2) |
$ 0 |
$ 0 |
$ 0 |
$ 0 |
Alice C. Brennan |
$ 0 |
$ 0 |
$ 0 |
$ 0 |
Herbert M. Chain |
$ 0 |
$ 0 |
$ 0 |
$ 0 |
Eric Sites(2) |
$ 0 |
$ 0 |
$ 0 |
$ 0 |
| (1) | Mr. Cleveland is an “interested person” as
defined by Section 2(a)(19) of the 1940 Act by virtue of being a limited partner in the Cleveland Family Limited Partnership,
which owns more than 5% of the Fund’s securities. |
| (2) | Horizon Kinetics Asset Management LLC is the investment
adviser to the Fund and Mr. Stahl and Mr. Sites are “interested persons” of the Fund as defined in Section 2(a)(19)
of the 1940 Act by virtue of being officers and directors of Horizon Kinetics Asset Management LLC, and in Mr. Stahl’s case,
a director and beneficial owner of outstanding securities of Horizon Kinetics Asset Management LLC. |
| (3) | The term “Fund Complex” means all 1940-Act-registered
investment funds, or separate portfolios of such a fund, which share a common investment adviser (or have investment advisers
that are affiliated persons) or which hold themselves out to investors as related companies for purposes of investment and investment
services. The Fund is not currently grouped into a Fund Complex with any other such funds. |
| (4) | As of June 30, 2023, no compensation has been paid to
any member of the Board of Directors. |
Compensation
Committee Interlocks and Insider Participation.
During the last completed
fiscal year of the Fund, no executive officer of the Fund was a director or member of a compensation committee of any entity of
which a member of the Fund’s Board was or is an executive officer.
PROPOSAL ONE AND TWO
The
Board recommends that shareholders vote FOR the election of Eric SITES AND aLICE C. BRENNAN As class ONE directorS.
PROPOSAL THREE
DECLASSIFY
THE BOARD OF DIRECTORS
The Fund’s
Bylaws divide the Board members into three (3) classes. One class is elected at each annual meeting of stockholders, to hold
office for a term beginning on the date of the election and expiring at the third annual meeting of stockholders thereafter.
Upon the recommendation
of our Nominating and Corporate Governance Committee, the Board has determined that it is advisable and in the best interests of
the stockholders to declassify the Board to allow for a vote on the election of the entire Board each year, rather than on a staggered
basis. The term of office for a Director shall be one year (“Term”). Thereafter, at each annual meeting, the shareholders
shall elect the candidates to fill the vacancy of all Directors annually. In the event that the number of Directors is increased,
the Term of office of such added directorships shall be one year. In the event that the number of Directors is decreased, the remaining
Directors shall serve their Term as elected. At each annual election, the persons receiving a majority of votes shall be the Directors.
The Director so elected shall hold office for the Term provided and until his or her successor is elected and qualified or until
his or her earlier death, resignation, disqualification, or removal.
If the Declassification
Amendment becomes effective, commencing at the 2023 annual meeting of shareholders, all Directors standing for election will become
subject to election on an annual basis for a one-year term. The division of Directors into classes shall terminate at the 2023
annual meeting of stockholders, with the expiration of the term of the directors elected at the Annual Meeting. Vacancies which
may occur during the year may be filled by the Board and each director so appointed shall serve for a term expiring at the next
election of the class for which such director shall have been chosen, or, following the termination of the division of Directors
into classes, for a term expiring at the next annual meeting of stockholders. If the stockholders do not approve this proposal,
then the Board will remain classified, with each class of Directors serving a term of three years. Notwithstanding the foregoing,
in all cases, each Director will hold office until his or her successor is duly elected, or until his or her earlier resignation
or removal.
The Board of Directors
is committed to good corporate governance at the Company. Accordingly, in determining whether to propose declassification as described
above, the Board carefully reviewed the various arguments for and against a classified Board structure. The Board recognizes that
a classified structure may offer several advantages, such as promoting Board continuity and stability, encouraging directors to
take a long-term perspective, and reducing a company’s vulnerability to coercive takeover tactics. The Board also recognizes,
however, that a classified structure may appear to reduce directors’ accountability to stockholders, since such a structure
does not enable stockholders to express a view on each director’s performance by means of an annual vote. The Board also
believes that implementing annual elections for all directors would support the Company’s ongoing effort to adopt “best
practices” in corporate governance. In view of the considerations described above, the Board of Directors, upon the recommendation
of its Nominating/Corporate Governance Committee, has unanimously determined that it is in the best interests of the Company and
its stockholders to eliminate the classified Board structure as proposed.
THE BOARD RECOMMENDS THAT SHAREHOLDERS
VOTE FOR THE DECLASSIFICATION OF THE BOARD OF DIRECTORS.
PROPOSAL FOUR
RATIFICATION OF APPOINTMENT OF AUDITOR
The Board of Directors
selected Tait, Weller & Baker LLP to audit the Fund for the fiscal year ending December 31, 2022. Tait, Weller & Baker
LLP was appointed as independent auditor to the Fund by Horizon Kinetics Asset Management LLC on April 20, 2017, and also served
as the Fund’s independent auditor for the fiscal year ended December 31, 2022. Its selection was approved by the vote of
a majority of the Board of Directors, including a majority of the directors who are not “interested persons” of the
Fund, as defined in the 1940 Act.
Tait, Weller &
Baker LLP performed the Fund’s audit for the fiscal year(s) ended December 31, 2022, and December 31, 2021. There were no
disagreements between the Fund and Tait, Weller & Baker LLP on any matter of accounting principles or practices, financial
statement disclosure or auditing scope or procedure, which disagreements, if not resolved to the satisfaction of Tait, Weller &
Baker LLP, would have caused it to make reference to the subject matter of the disagreements in its reports on the financial statements
of the Fund for such year.
During the Fund’s
two most recent fiscal years ended December 31, 2022, and December 31, 2021, and in the subsequent interim period through June
30, 2023, there were no “reportable events” (as defined in Item 304(a)(l)(v) of Regulation S-K under the Securities
Exchange Act of 1934, as amended).
A representative of
Tait, Weller & Baker LLP, is expected to attend the Annual Meeting, and will respond to appropriate questions from shareholders
and will have the opportunity to make a statement, should he or she so desire.
The following table
presents fees paid by the Fund for professional services rendered by Tait, Weller & Baker LLP, for the fiscal year ended December
31, 2022, and for the fiscal year ended December 31, 2021.
Fee Category | |
Fees for 2021 | | |
Fees for 2022 | |
Audit Fees | |
$ | 29,000 | | |
$ | 33,000 | |
Audit-Related Fees | |
| 0 | | |
| 0 | |
Tax Fees | |
$ | 4,000 | | |
$ | 4,000 | |
All Other Fees | |
| 0 | | |
| 0 | |
Total Fees | |
$ | 33,000 | | |
$ | 33,000 | |
Audit Fees were for
professional services rendered for the audit of the Fund’s annual financial statements. No tax or other non-audit fees were
incurred or paid by the Fund to the independent audit firm of Tait, Weller & Baker LLP for either of the fiscal years indicated
in the table.
The Audit Committee
has adopted a pre-approval policy that provides for the prior consideration by the Audit Committee of any audit or non-audit services
that may be provided by its independent auditor to the Fund. Audit services were approved as delineated on the auditor’s
engagement letter before services were commenced. Tax or other non-audit fees were pre-approved with regard to the auditor for
the fiscal year ended December 31, 2022. Neither has the Audit Committee pre-approved its auditors providing any non-audit services
for the Adviser, or any entity controlling, controlled by, or under common control with the Adviser that provides ongoing services
to the Fund, nor is it aware of any such situation that would require its pre-approval.
Tait, Weller &
Baker LLP’s address is 50 South 16th Street, Suite 2900, Philadelphia, PA 19102. No conflicts between the Fund
and the auditor occurred during the conduct of the audit for the year ended December 31, 2022.
AUDIT COMMITTEE REPORT
The Audit Committee
has reviewed and discussed the Fund’s audited financial statements for the fiscal year ended December 31, 2022, with the
Fund’s management. The Audit Committee has discussed with Tait, Weller & Baker LLP, the Fund’s independent auditor,
the matters required to be discussed by the standards of the Public Company Accounting Oversight Board. The Audit Committee has
received the written disclosures and the letter of Tait, Weller & Baker LLP, required by current authoritative standards and
has discussed with the auditor its independence.
Based on the review
and discussions described above, among other things, the Audit Committee recommended to the Board of Directors that the audited
financial statements of the Fund be included in the Fund’s Annual Report to Shareholders for the fiscal year ended December
31, 2022. The Fund’s Annual Report to Shareholders for the fiscal year ended December 31, 2022, which includes the Fund’s
audited financial statements for that year, was previously distributed to the Fund’s shareholders.
The affirmative vote
of a majority of shares present, in person, virtually, or by proxy, and entitled to vote at the Annual Meeting is required for
the ratification of the selection of the Fund’s independent auditors.
THE BOARD RECOMMENDS
THAT SHAREHOLDERS VOTE FOR THE RATIFICATION OF THE APPOINTMENT OF TAIT, WELLER & BAKER LLP, AS THE FUND’S INDEPENDENT
AUDITOR FOR THE FISCAL YEAR ENDING DECEMBER 31, 2023.
DISSENTER’S RIGHTS
The Texas Business
Organizations Code does not grant shareholders of a Texas corporation dissenter’s rights with respect to any of the Proposals
covered by this Proxy Statement.
SECTION
16(a) BENEFICIAL
OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the
Securities Exchange Act of 1934, as amended, requires the Fund’s officers and Directors and persons who own more than 10%
of a registered class of the Fund’s equity securities to file reports of ownership and changes in ownership with the SEC.
Such reporting individuals are required by SEC regulations to furnish the Fund with copies of all Section 16(a) forms that they
file.
To the Fund’s
knowledge, all Section 16(a) filings relating to the Fund’s common stock applicable to its officers, Directors, and greater-than-10%
beneficial owners were timely filed for the fiscal year ended December 31, 2022.
SUBMISSION
OF SHAREHOLDER PROPOSALS
Pursuant to Rule 14a-8
under the Securities Exchange Act of 1934, as amended, shareholders may present proper Proposals for inclusion in the Fund’s
proxy statement for consideration at its Annual Meeting of Shareholders by submitting Proposals to the Fund in a timely manner.
A shareholder may submit a Proposal for inclusion in the Proxy Statement for the Annual Meeting of Shareholders to be held in 2023,
if such Proposal is submitted to the Fund on or prior to the 120th day before the date in 2023 that is the same date as the date
on which the Proxy Statement for last year’s Annual Meeting was mailed, which submission deadline was March 28, 2023. Any
Shareholder Proposal to be submitted for consideration at the Annual Meeting to be held in 2023 was required to have been sent
prior to March 28, 2023, to Corporate Secretary, RENN Fund, Inc., c/o Horizon Kinetics Asset Management LLC, 470 Park Avenue South,
New York, NY 10016.
OTHER
BUSINESS
As provided by
Texas law and the Fund’s bylaws, only business within the purposes described in the accompanying notice may be conducted
at the Annual Meeting. If any other matter within such purposes properly comes before the Annual Meeting or any adjournment(s),
then the persons named in the proxy will vote on such matters pursuant to the proxy in their discretion and as they deem appropriate.
Unless you submit
instructions to the contrary to the Fund, annual reports to shareholders, proxy materials, and notices of internet availability
of proxy materials will be furnished by “householding,” that is, only one set of materials, together with the appropriate
number of proxy cards, will be sent to any residential address on record for more than one shareholder. You may request in
writing or by telephone that in the future you should be sent an individual set of materials, in which case you will then commence
receiving individual sets of materials for any mailings occurring 30 days or more after your request. To make such a request you
should contact our transfer agent, EQ, at 6201 15th Avenue, Brooklyn, New York 11219, telephone (718) 921-8200, Extension
6412. You may also access a copy of the proxy materials (but not a votable copy of the proxy card) from the Fund’s website
at https://horizonkinetics.com/products/closed-end-funds/renn/
SHAREHOLDER
COMMUNICATIONS WITH THE BOARD
Generally, shareholders
who have questions or concerns regarding the Fund should contact Board of Directors of RENN Fund, c/o Horizon Kinetics Asset Management
LLC, 470 Park Avenue South, New York, NY 10016. All communications must contain a clear notation indicating that it is a “Shareholder—Board
Communication” or a “Shareholder—Director Communication” and must identify the author as a shareholder.
The Corporate Secretary will forward the correspondence, if appropriate, to the Chairman of the Board or to any individual Director
to whom the communication is directed. The Fund reserves the right not to forward to the Board any communication that is hostile,
threatening, illegal, not reasonably related to the Fund or its business, or similarly inappropriate. The Corporate Secretary has
authority to discard or disregard any inappropriate communication or to take any other action that it deems to be proper with respect
to any inappropriate communications.
You are cordially
invited to attend the Annual Meeting of Shareholders in person or virtually. However, whether or not you plan to attend the
Annual Meeting, you are requested to promptly vote your proxy online, or by telephone, or by completing, signing, and returning
the proxy card in the enclosed postage-paid envelope. Please refer to the proxy card for details.
By Order of the Board of Directors,
Jay Kesslen
Chief Compliance Officer
New York, New York
July 25, 2023
NOMINATING AND CORPORATE GOVERNANCE
COMMITTEE CHARTER
RENN FUND, INC.
Purpose
The purpose of the Nominating and Corporate Governance
Committee of the Board of Directors (the “Board”) is as follows:
| ● | consider qualified candidates to serve as Board members; |
| ● | consider and nominate nominees for election as Board members; and |
| ● | at the direction of the Board of Directors, consider various corporate governance policies and procedures. |
Committee Membership
The
Nominating and Corporate Governance Committee shall consist of at least two members. The members of the Nominating and Corporate
Governance Committee shall meet the applicable membership and independence requirements under National Association of Securities
Dealers (“NASD”) Rule 4200.
The
members of the Nominating and Corporate Governance Committee shall be appointed annually by the Board. The Board from time to time
may remove members of the Nominating and Corporate Governance Committee and fill any resulting vacancy.
Meetings
The
Nominating and Corporate Governance Committee shall hold at least one meeting per year and such additional meetings as the Nominating
and Corporate Governance Committee shall determine.
Committee Duties and Powers
To carry out its purpose, the Nominating and Corporate
Governance Committee shall have the following duties and powers:
Identification
of Potential Board Members. The Nominating and Corporate Governance Committee shall seek and identify individuals qualified
to become members of the Board, consistent with its nominating criteria.
Nomination
of Director Nominees. The Nominating and Corporate Governance Committee shall consider and nominate nominees for election at
each annual meeting of the shareholders of the Company.
Independence
and Qualification of Members of the Board. The Nominating and Corporate Governance Committee shall review with the Board at
least annually the qualifications of new and existing members of the Board, considering the level of independence of individual
members, together with such other factors as the Board may deem appropriate, including overall skills, financial literacy and experience,
to ensure the Company’s on-going compliance with the independence and other standards set by the NASD.
Corporate Governance.
The Nominating and Corporate Governance Committee shall, at the direction of the Board, consider various corporate governance policies
and procedures.
Reports to the Board. The Nominating and Corporate
Governance Committee shall make regular reports to the Board.
Nominating and Corporate
Governance Committee Charter. The Nominating and Corporate Governance Committee shall review and assess this charter and recommend
any proposed changes to the Board for approval.
Other Duties. The
Nominating and Corporate Governance Committee also shall perform such additional duties and have such additional
responsibilities and functions as the Board from time to time may determine.
Updated: July 6, 2017
AMENDED CHARTER
OF THE AUDIT COMMITTEE
OF THE BOARD OF DIRECTORS
OF THE RENN FUND, INC.
Renn Fund, Inc. (the “Fund”)
certifies that it has adopted this amended Charter (the “Charter”) as its formal written audit committee charter, effective
as of July 6, 2017 and amended as noted below.
I. Audit Committee Purpose
The Audit Committee is appointed by the
Board of Directors to assist the Board in fulfilling its oversight responsibilities. The Audit Committee’s primary duties
and responsibilities are to:
| ● | Appoint and approve the compensation of
the Fund’s independent auditors, including those to be retained for the purpose of preparing or issuing an audit report or
performing other audit review or attest services for the Fund; |
| ● | Review the scope of their audit services
and the annual results of their audits; |
| ● | Monitor the independence and performance
of the Fund’s independent auditors; |
| ● | Oversee the accounting and financial reporting
processes of the Fund and the audits of its financial statements, generally; |
| ● | Review the reports and recommendations
of the Fund’s independent auditors; |
| ● | Provide an avenue of communication among
the independent auditors, management and the Board of Directors; and |
| ● | Resolve any disagreements between management
of the Fund and its independent auditors regarding financial reporting. |
The Fund’s independent auditors must
report directly to the Audit Committee.
The Audit Committee has the
authority to conduct any investigation appropriate to fulfilling its responsibilities, and it has direct access to the
independent auditors as well as anyone in the organization. The Audit Committee has the ability to retain, at the
Fund’s expense, special legal, accounting, or other consultants or experts it deems necessary in the performance of its
duties, and it shall have the ability to determine the compensation to be paid to such outside consultants or experts.
II. Audit Committee Composition and
Meetings
The Audit Committee shall be comprised
of two or more directors as determined by the Board, each of whom shall be independent directors meeting the independence and other
requirements of the American Stock Exchange and Rule 10A-3(b)(1) promulgated under the Securities Exchange Act of 1934, as amended.
All members of the Committee shall:
| ● | Not have participated in the preparation
of the financial statements of the Fund or any subsidiary at any time in the last three years; and |
| ● | Have a basic understanding of finance
and accounting and be able to read and understand fundamental financial statements, including a company’s balance sheet,
income statements and cash flow statement, among others. |
In addition, at least one member of the
Committee shall have accounting or related financial management expertise, as defined by the applicable Securities and Exchange
Commission (“SEC”) regulation.
If an Audit Committee Chair is not designated
or present, the members of the Committee may designate a Chair by majority vote of the Committee membership. The Committee shall
meet from time to time as it shall determine, but not less than on a semiannual basis. The Committee may meet with management or
the independent auditors to discuss any matters that the Committee may determine.
III. Audit Committee Responsibilities
and Duties
In addition to fulfilling the purposes
described above, the Audit Committee shall have the following specific responsibilities and duties:
Review Procedures.
| ● | Periodically review and assess the adequacy
of the Charter. |
| ● | Submit the Charter to the Board of Directors
for approval and have the document filed in accordance with SEC regulations. |
| ● | Review, along with management and independent
auditors, the Fund’s annual audited financial statements prior to filing or distribution. |
| ● | Review all proposed related party transactions
and submit its findings and recommendations to the independent Directors of the Board for their final approval. |
| ● | Review with management and the independent
auditors the Fund’s quarterly financial results prior to the release of earnings and/or the Fund’s quarterly financial
statements prior to filing or distribution. Discuss any significant changes to the Fund’s accounting principles and any items
required to be communicated by the independent auditors in accordance with American Institute of Certified Public Accountants (“AICPA”)
SAS 61. |
Independent Auditors.
| ● | The independent auditors are ultimately
accountable to the Audit Committee and the Board of Directors. It is the Audit Committee’s responsibility to ensure that
it has received a formal written statement from independent auditors delineating all relationships between the Fund and the independent
auditor. The Audit Committee shall review the independence and performance of the auditors and shall have the responsibility for,
and authority to, appoint and/or discharge the independent auditors, and to approve the fees and other compensation to be paid
to the independent auditors. |
| ● | On an annual basis, the Committee should
review and discuss with the independent auditors all significant relationships they have with the Fund that could impair the auditor’s
independence. |
| ● | Prior to releasing the year-end earnings,
discuss the results of the audit with the independent auditors and discuss certain matters required to be communicated to audit
committees in accordance with AICPA SAS 61. |
| ● | Consider the independent auditor’s
judgments about the quality and appropriateness of the Fund’s accounting principles as applied in its financial reporting. |
Other Audit Committee Responsibilities.
| ● | Annually prepare a report to shareholders
as required by the SEC for inclusion in the Fund’s annual proxy statement. |
| ● | Establish and periodically review the
Fund’s procedures for (a) the receipt, retention and treatment of complaints received by the Fund regarding accounting, internal
accounting controls or auditing matters, and (b) the confidential, anonymous submission by employees of the Fund regarding questionable
accounting or auditing matters. |
| ● | Perform any other activities consistent
with the Charter, the Fund’s by-laws, and governing law, as the Committee or the Board deems necessary or appropriate. |
| ● | Maintain minutes of meetings and periodically
report to the Board of Directors on significant results of the foregoing activities. |
| ● | Determine the funding necessary to cover
the ordinary administrative expenses of the Audit Committee that are necessary or appropriate in carrying out its duties. |
Last Updated: May 2023
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